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Wednesday, April 2, 2008

Hewehi Market Overview

Textainer Group reports refrigerated container market update (TGH) 15.90 +0.60 : Co reported that 770 units out of the 800 reefer containers, initially purchased in January 2008, have been committed to leases with various shipping lines. Co says, "we expect a fairly modest capital expenditure of $30 mn for reefers in 2008. Based on our initial success with the first units produced, and the recent new order, we may exceed that goal for the year."

Cliffs North American coal declares force majeure on coal shipments from Pinnacle Mine (CLF) 132.99 +5.53 : Co announced its Cliffs North American Coal, LLC subsidiary has declared force majeure on coal shipments from its Pinnacle Mine in Pineville, W. Va. Cliffs indicated the longwall plow is currently mining through a sandstone intrusion into the coal seam, which has caused coal production at the mine to significantly slow, as well as reduced shipments. The sandstone intrusion is a continuation of the same geology that slowed production at Pinnacle Mine in August 2007.

Baker Hughes announces in an 8-K, on April 2, 2008, the co increased by $500 mln its commercial paper program (BHI) 72.05 +1.56 : In an 8-K, co says as of April 2, 2008, the co may issue from time to time unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time of $1 bln.

Patriot Coal announces agreement to acquire Magnum Coal (PCX) 46.95 -0.76 : Co today announced that it has signed an agreement to acquire Magnum Coal ("Magnum"). Magnum is one of the largest and lowest-cost coal producers in Central Appalachia, operating 12 mines and 7 preparation plants. Magnum sold 18.4 mln tons of coal in 2007 and has over 600 million tons of proven and probable reserves in southern West Virginia. On a pro forma basis, the combination of PCX and Magnum would have sold more than 40 mln tons in 2007 and generated revenues of just under $2.0 bln. Proven and probable reserves on a combined basis will exceed 1.9 bln tons. The combined assets will provide Patriot a more balanced production mix, with ~70% underground and 30% surface mining.

MI Developments rejects mischaracterizations in Greenlight press release (MIM) 28.94 -0.13 : Co responded to the press release issued by Greenlight Capital (Greenlight) with respect to the reorganization proposal received on March 31, 2008 on behalf of various MID shareholders, including entities affiliated with Frank Stronach, MIM's controlling shareholder, and institutional shareholders. MIM shareholders owning an aggregate of more than 50% of the outstanding Class A Subordinate Voting Shares and 95% of the outstanding Class B Shares have signed support agreements in favour of the reorganization proposal. MIM rejects the mischaracterizations contained in the Greenlight press release concerning the manner in which MID has conducted its affairs.

Selectica: Leading Government contractor chooses selectica contract lifecycle management solution (SLTC) 1.37 -0.03 : Selectica (SLTC), a provider of enterprise contract lifecycle management solutions, announced that ManTech International (MANT) plans to implement SLTC Contract Performance Management.

First Place Finl announces definitive agreement to acquire OC Financial for $12.86 (FPFC) 13.93 -0.06 : Co First Place Financial (FPFC), the holding co for First Place Bank headquartered in Warren, Ohio, and OC Financial (OTC Bulletin Board: OCFL), the holding co for Ohio Central Savings headquartered in Dublin, Ohio, today announced that they have reached a definitive agreement for First Place to acquire OC Financial in a stock merger transaction. This transaction is valued at ~$7.2 mln, based on the average closing price of FPFC common stock for the 10 business days ended April 1, 2008 of $13.37 which would result in a value of $12.86 for each OC Financial share. The transaction is expected to contribute positively to FPFC's EPS, excluding one-time merger-related costs, in its fiscal year ending June 30, 2009.

Chevron cites bias and improper collaboration in rejecting conclusions of report submitted to Ecuadorian Court (CVX) 87.51 +0.77 : Co said that it will petition the Superior Court in Lago Agrio to strike from the record a flawed and patently partisan report submitted in the ongoing environmental lawsuit filed by Ecuadorian citizens against Chevron.

Helix Energy Sells Interest in Deepwater Fields for $165 mln (HLX) 31.42 +0.43 : Energy Resource Technology GOM, Inc. (ERT), a wholly owned subsidiary of Helix Energy Solutions (HLX), has agreed to sell a 30% working interest in its Danny Noonan discoveries (Garden Banks Blocks 463, 506 and 507) and other Outer Continental Shelf oil and gas properties (East Cameron Blocks 371 and 381), in two separate transactions to a private independent oil and gas co for total cash consideration of ~$165 mln (which includes their share of past capital expenditures on these fields), and additional cash payments of up to $20 mln based upon certain field production milestones.

City Holding Co announces issuance of $16 mln trust preferred securities and redemption of trust preferred securities (CHCO) 41.84 +0.50 :

City Holding Co announces it has received proceeds of $2.3 mln from the Visa IPO (CHCO) 41.84 +0.50 : The co announces that it received proceeds of $2.3 million on the partial redemption of its equity interest in Visa. In addition, City expects to reverse approximately $1.0 million of liabilities previously established that represented City's share of legal judgments and settlements related to Visa litigation. As a result, City's first quarter 2008 results are expected to benefit by $2.1 million after-tax, or $0.13 per diluted common share.

RenaissanceRe acquires Claims Management Services (RNR) 53.25 -0.54 : Co announces that its indirect wholly-owned subsidiary, Glencoe Group Claims Management, has acquired the assets of Claims Management Services, a privately-held provider of claims Perini and Tutor-Saliba Corp to combine (PCR) 38.21 +0.15 : Co announces that they have signed a definitive agreement to merge with Tudor-Saliba Corp. The transaction has been structured as a tax-free, all-stock merger. Under the agreement, Tutor-Saliba shareholders will receive shares equal to approximately 45% of the common stock of PCR in exchange for their interests in Tutor-Saliba. The total transaction value will be approximately $862 mln based on PCR's closing price of $38.10 on April 1, 2008, including assumed adjusted net cash of Tutor-Saliba as of December 31, 2007. The transaction, which is expected to close during the third quarter of 2008, is expected to be accretive to diluted earnings per share beginning in the first full fiscal year of combined operations. PCR is maintaining its existing guidance for fiscal 2008 of diluted earnings per share of $3.50 to $3.75. Co is now targeting fiscal 2009 revenue and diluted earnings per share in the range of $7.3 to $7.8 bln and $4.00 to $4.20, respectively, and targeting diluted earnings per share growth in 2010 of between 10% to 20%.

Fisher Companies appoints Joseph Lovejoy as acting CFO (FSCI) 32.10 -0.20 : The co announces that following the resignation of S. Mae Fujita Numata from her position as SVP, CFO and Corporate Secretary on April 1, 2008, Joseph L. Lovejoy has been named Acting CFO effective today. Lovejoy has been a senior vice president of the co since December 2006, responsible for strategic planning, financial analysis and business development.

Amgen: Pivotal Phase 3 Data Show Denosumab Increased Bone Density at Multiple Skeletal Sites in Early and Later Stage Postmenopausal Women (AMGN) 42.45 +0.29 : The co announces the publication of results from its 24-month, 332-patient Phase 3 pivotal study in women with early and late stage postmenopausal osteoporosis in the Journal of Clinical Endocrinology and Metabolism. In this Phase 3 study, twice-yearly subcutaneous injections of denosumab increased bone mineral density at all sites measured, including in highly cortical areas of the skeleton. Cortical bone comprises 75% of skeletal mass and is a primary determinant of overall strength in vertebral and non-vertebral sites throughout the skeleton... Amgen expects the results of its large, pivotal Phase 3 registrational study, which will evaluate denosumab's impact on fracture risk reduction, in women with postmenopausal osteoporosis, in the second half of this year.

Robbins & Myers announces $5.4 mln gain; increases Q3 2008 EPS guidance to $0.53-0.58 vs. $0.47 and FY08 EPS guidance to $1.92-2.03 vs. $1.94 consensus (RBN) 33.64 -0.41 : The co announces that certain contingency obligations relating to the sale of two of its Romaco product lines in fiscal year 2006 expired on March 31, 2008. As a result, the co expects to recognize an additional pretax gain on that sale of approximately 3.5 mln euros, or $5.4 mln at current exchange rates, in its third fiscal quarter ending May 31, 2008. This gain, which was not included in the co's previously issued earnings guidance, is expected to increase diluted earnings per share for its third quarter and full year of fiscal 2008 by approximately $0.11 per share. Therefore, the co increased its third quarter fiscal 2008 DEPS guidance to $0.53-0.58, including an $0.11 gain, vs. $0.47 First Call consensus, from $0.42-$0.47, and its full year fiscal 2008 guidance to $1.93-$2.03, including the $0.11 gain, vs. $1.94 First call consensus, from $1.82-$1.92.

Solutia raises price on all Ascend and Vydyne nylon plastics and polymers (SOA) 13.96 +0.16 : Co announced a price increase of $0.10 per pound across its Ascend and Vydyne polyamide 66 resins in the North American market. This increase applies to orders shipped on or after April 15, 2008, and will be applied across the Ascend and Vydyne product families.

AMR Corp: American Eagle Airlines reports March traffic; traffic decreased 9.5% YoY (AMR) 9.59 -0.26 : American Eagle reports a March load factor of 73.4%, down 0.7 points compared to the same period last year. Traffic decreased 9.5% YoY as capacity decreased 8.6%. American Eagle boarded 1.7 mln passengers in March.

Isilon Systems reports Q3 and Q4 results, has completed its restatement of financial statements (ISLN) 4.91 -0.11 : Co announces its financial results for the fiscal year ended December 30, 2007, including the third and fourth quarters of 2007. Co also announced that its Audit Committee has concluded its independent review of the timing and treatment of revenue recognition and the co has completed the restatement of financial statements for certain previous periods. ISLN reports Q3 EPS ($0.10) vs ($0.09) First Call consensus; revs $21.6 mln vs $23.88 mln First Call consensus. Co also reports Q4 EPS ($0.11) vs ($0.06) First Call consensus; sees revs $26.60 mln vs $26.63 mln First Call consensus.

Synthesis Energy Systems regains complaince with NASDAQ listing requirements (SYMX) 8.47 +0.47 :

BEA Systems: SEC notifies BEA Systems of termination of inquiry (BEAS) 19.19 +0.00 : Co announces that on March 31, 2008, it received a letter from the San Francisco Regional Office of the Securities and Exchange Commission stating that the inquiry concerning the Company's historical stock option granting practices has been terminated and that no enforcement action has been recommended to the Commission. Briefing note: BEAS has been acquired by ORCL.

KBR Inc. joint venture awarded engineering and procurement management services (KBR) 28.66 +0.30 : Co announces that its "Eos" joint venture with WorleyParsons has been awarded contract options for the detailed engineering and procurement management services for Woodside's North Rankin 2 project. The Eos Joint Venture has completed Front-End Engineering Design for the North Rankin B platform and the North West Shelf Venture participants have recently announced final approval of the complete NR2 project. The combined revenue of the Front-End Engineering Design and contract options for the Eos Joint Venture is ~$320 mln.

AngioDynamics reports EPS in-line, revs in-line; guides FY08 EPS above consensus, revs in-line (ANGO) 11.55 -0.04 : Reports Q3 (Feb) earnings of $0.12 per share, excluding $0.08 gain from Diomed settlement which was announced today, in-line with the First Call consensus of $0.12; revenues rose 52.4% year/year to $40.7 mln vs the $40.7 mln consensus. Co issues mixed guidance for FY08, sees EPS of $0.58-0.61 vs. $0.50 consensus; sees FY08 revs of $165-167 mln vs. $164.82 mln consensus. "The co also announced it has entered into a settlement agreement with Diomed. AngioDynamics reduced its litigation provision and recorded a gain, net of costs, of approximately $3.2 million pre-tax, $2.0 million after-tax, and $0.08 in earnings per share, as reflected in the fiscal third quarter results."

EXFO to acquire Brix Networks for $28.5 mln in cash plus earn-out (~$37.5 mln) (EXFO) 5.90 +1.05 : Co announced today that it has signed an agreement to acquire all the shares of Brix Networks, a global provider of open and extensible converged service assurance solutions. Consideration to be paid consists of $28.5 mln in cash and an additional earn-out based upon the achievement of bookings levels exceeding $16 mln in the 12 months following the closing date of the transaction. Total purchase price could reach $37.5 mln, including a maximum earn-out and other acquisition-related costs. The deal is expected to be negative to earnings for the remainder of fiscal 2008, neutral in fiscal 2009 and accretive in 2010, excluding stock-based compensation costs and after-tax amortization of intangible assets.

Ruby Tuesday beats by $0.05, misses on revs; guides FY08 EPS in-line (RT) 7.87 +0.05 : Reports Q3 (Feb) earnings of $0.23 per share, $0.05 better than the First Call consensus of $0.18; revenues fell 7.1% year/year to $351.2 mln vs the $367.9 mln consensus. Co issues in-line guidance for FY08, sees EPS of $0.40-0.50, includes expenses incurred in our remodel initiative of $0.18 to $0.20 per diluted share, vs. $0.45 consensus.

HNI warns of weakening first quarter revenue and profit (HNI) 27.76 +0.41 : Co announces it expects Q1 2008 revenue and operating profit in its office furniture segment to experience a significant decline over previously communicated expectations. The co estimates Q1 office furniture revenue declined 6% as compared to the prior year. The revs decline resulted from substantial weakness in the supplies-driven channel, which consists primarily of small office and home office customers and represents ~50% of HNI's total office furniture revenue. The supplies-driven channel weakness will have a significant impact on profitability. Escalating input cost pressures and plant consolidation costs are also negative contributing factors.

LDK Solar signs a ten-year wafer supply agreement with Moser Baer Photo Voltaic (LDK) 30.09 +2.59 : Co announced that it has signed a ten-year contract which is a blend of "Take or Pay" linked with market-based pricing to supply multicrystalline solar wafers to India-based Moser Baer Photo Voltaic Limited, a subsidiary of Moser Baer India Limited. Under the terms of the agreement, LDK Solar will deliver 640 MW of multicrystalline solar wafers to MBPV over a ten-year period commencing in mid 2008 through 2017. MBPV will make a suitable advance payment reflecting the contract value to LDK Solar.

Landec delays Q3 release and provides preliminary Q3 results (LNDC) 8.13 -0.34 : Co announces that its newly appointed independent registered public accounting firm need additional time to complete the preparation and review of financial statements for Q3. The public accounting firm has raised some questions regarding the interpretation of certain complex technical accounting rules affecting the accounting treatment for the transactions entered into with Monsanto and its subsidiaries. Co had expected to report Q3 EPS of approx $0.15 vs $0.15 consensus with revs of approx $59.6 mln vs $58.8 mln consensus, but these numbers are subject to adjustment depending on the outcome of the ongoing review.

La-Z-Boy announces consolidation; to take charge of $0.20-0.24 (LZB) 8.85 +0.16 : The co will consolidate all of its domestic cutting and sewing operations in Mexico and will transfer production from its Tremonton, Utah plant, which will be closed, to its five remaining La-Z-Boy branded upholstery manufacturing facilities. As a result of these actions, La-Z-Boy will take a pre-tax restructuring charge in the range of $17 - $20 mln, or $0.20 to $0.24 per share. This charge will be principally for severance and other benefit costs and will also include training costs to begin production in the other facilities, the write-down of certain fixed assets and other associated costs. As the plant is closed and the cut-and-sew operations are transferred, these charges will be incurred as follows: $2.0 - $2.5 mln in the fourth quarter of fiscal 2008; $9.0 - $10.0 mln in fiscal 2009; and the balance in 2010. Once these moves are completed, the co expects to realize in excess of $25 mln in annual cost savings, with the full benefit beginning in fiscal 2011.

Design Within Reach announces multi-year employment agreement with CEO Ray Brunner (DWRI) 3.05 +0.01 :

Wireless Xcessories intends to cease trading on Amex and to deregister its common stock with the SEC (XWG) 1.31 +0.06 :

Triad Guaranty: Fitch downgrades Triad's IFS to 'BBB-'; watch negative (TGIC) 3.60 -1.65 : Fitch has downgraded the following ratings on Triad Guaranty and its mortgage insurance subsidiary: Triad Guaranty Insurance Corporation Insurer financial strength (IFS) to 'BBB-' from 'AA-', Long-term Issuer to 'BB-' from 'A-' and $35 million 7.9% fixed coupon senior notes due Jan.15, 2028 to 'BB-' from 'A-'. This action follows the publication of Triad Guaranty's yearend 2007 10-K filing in which the company disclosed that it has not been successful in obtaining any new capital commitments to date. The company also disclosed that it is considering placing its operating company Triad into 'run-off', and creating a newly formed mortgage insurance subsidiary that would underwrite all future business.

VCG Holding CFO no longer with the co; co engages financial consultants to assist in accounting until the search for a CFO is completed (VCGH) 5.22 -1.33 : Co announced that its Chief Financial Officer and Chief Accounting Officer, Mr. Brent Lewis, is no longer with the Company effective March 31, 2008. The Company is conducting a search for a Chief Financial Officer and has engaged financial consultants on an interim basis to assist with the preparation of the Company's Form 10-K for the period ended December 31, 2007, as well as other accounting issues.

CBOT Agriculture and Ethanol Closing Prices (COMDX) : May corn closed higher by 12 cents to $5.96 per bushel, May soybeans closed higher by 32 1/4 cents to $12.43 1/4 per bushel, May wheat closed higher by 41 cents to $9.36 per bushel, May Ethanol closed higher by $0.063 to $2.480 per gallon.

NYMEX Energy Closing Prices (COMDX) : Crude closed the session up $3.87 to $104.85, nat gas settled higher by 11.6 cents to $9.84, heating oil ended up 7.23 cents to $2.9520 and RBOB gasoline finished higher by 13.46 cents to $2.7738.

TechTeam wins USA contact program award with the GSA office of Citizen Services and Communications (TEAM) 9.32 +0.15 : Co announces it has won a government-wide indefinite delivery, indefinite quantity contract for multi-channel contact center services with the General Administration Services' Office of Citizen Services and Communications. The program, called USA Contact, has a potential value over ten years of up to $2.5 bln. Eight other companies were also awarded program contracts.

Alpha Pro Tech announces $2 mln stock buy back program (APT) 1.22 +0.05 :

Brush Engineered Materials awarded $9.8 mln in new orders to produce infrared window assemblies and hybrid circuits (BW) 27.09 +0.28 :

Packeteer: Elliott Associates reaffirms offer to acquire PKTR, sends merger agreement to seek consensual transaction (PKTR) 5.92 +0.69 : Elliott Associates sent the following letter to the Board of Directors of PKTR: "On March 20, 2008, we commenced a tender offer to acquire all of the outstanding shares of Common Stock of Packeteer for $5.50 per share. We were extremely disappointed to have read in your press release and Schedule 14D-9 filed April 1, 2008 that you have advised shareholders to reject our offer and that you have instituted a poison pill. Our offer provides shareholders with quantifiable, certain value that can be realized in an extremely short timeframe. As we informed you weeks ago, we were -- and remain -- prepared to negotiate a consensual transaction on customary terms immediately. To this end, we sent your counsel a merger agreement yesterday... Our offer and the transaction set forth in the draft merger agreement we sent to you provides a level of certainty far in excess of the alternatives you described to your shareholders, which alternatives consist only of: 1) a sale of the company or business combination transaction which you acknowledge are only "potentially attractive" and which your Board has not yet determined whether to pursue; or 2) pursuing your newly devised operating plan, which you refer to as being able to deliver "materially higher numbers than are anticipated by Wall Street consensus estimates," without any explanation of how this is to be achieved. These nebulous alternatives of a potential sale or the promise of improved operating performance contrast sharply with the speed and surety of our offer."

Westmoreland Coal announces Kevin Paprzycki has been named Chief Financial Officer (WLB) 14.23 +0.53 : Co announces Kevin Paprzycki has been named Chief Financial Officer, replacing David Blair who is leaving the co. Paprzycki has served as the co's Controller and Principle Accounting Officer since June 2006.

Schering-Plough: Fitch places ratings on rating watch negative (SGP) 14.23 -0.52 : Fitch Ratings has placed Schering-Plough ratings on Rating Watch Negative. The action applies to ~$11.98 bln of outstanding debt. The Rating Watch reflects Fitch's concern that Schering-Plough will be unable to reduce leverage, total debt-to-EBITDA, to below 2.0x by the end of 2009 given potential sales erosion of the cholesterol-lowering medicines, Vytorin and Zetia.

China Security and Surveillance reaffirms Q1 and FY08 guidance in 8-K presentation (CSR) 18.68 +0.37 : Co sees Q1 revs of $68-70 mln, EPS of $0.31-0.34 and FY08 revs of $350-370 mln, EPS of $1.50-1.75. (no consensus)

Golden Star Resources appoints D. Scott Barr as Executive Vice President and Chief Operating Officer (GSS) 3.42 +0.08 : Co announces that it has appointed D. Scott Barr as Chief Operating Officer commencing on April 2, 2008.

OMNI Energy Srvs announces appointment of Brian Recatto as President and Chief Executive Officer (OMNI) 3.69 -0.08 : Co announces that its Board of Directors has approved the appointment of Brian Recatto as the President and Chief Executive Officer, effective July 1, 2008. Recatto has significant operational and public company experience and has served as the Chief Operating Officer since December 2007.

Trinity Biotech announces the launch of new GeneSys Neonatal Haemoglobin Variant Screen (TRIB) 4.53 -0.05 :

RLI Corp expands small fleet trucking program (RLI) 50.83 +0.30 : Co announces the expansion of its small fleet trucking program to include new retail agents. The program had previously been limited to existing, appointed agents. The expansion is intended to provide more retail agents with direct access to RLI.

Commonwealth Biotech subsidiary announces two new major drug discovery collaborations (CBTE) 2.05 -0.04 : Co announces that it has entered into two new drug discovery collaborations: one with a leading US pharmaceutical company and one with a major European pharmaceutical company. Given the proprietary nature of the collaborations both partners declined to be named. "With our new European partner, we have entered into a broad-based collaboration to discover and develop novel small-molecule therapeutics for use in the fields of CNS; Alzheimer's disease, neuro-inflammation and type-2 diabetes... Under the terms of the agreement, based on compounds discovered by Exelgen, our partner will receive an option to license the compounds and collaborate in specific programs. With the signing of the agreement, our partner will make an initial up-front cash payment to Exelgen for exclusivity on certain program assets and have the option to continue development of the assets in collaboration with Exelgen." If this collaboration proves successful and a drug candidate is identified, Exelgen would receive ongoing support through additional research funding and, more importantly, will be eligible to receive success-based milestones of up to $25 million and additional royalties on any product sales.

Computer Task announces extension of 10b5-1 plan to facilitate share repurchases (CTGX) 3.37 -0.11 : Co announces that it extended a stock repurchase plan under Rule 10b5-1 of the SEC to facilitate the repurchase of its common stock under its outstanding repurchase authorizations. The Company has approx 1.1 mln shares available for repurchase as of April 2, 2008 under previous authorizations.

Abraxas Petroleum provides operational results on exploratory Wilcox Well (ABP) 3.27 -0.03 : Co provided operational results on the Gisler #1, an exploratory well targeting the Wilcox formation, located in Karnes County of South Texas. The Gisler #1 was drilled vertically to a total depth of approx 13,000', completed without stimulation and placed on-line approx two weeks ago. This well is currently producing at a gross rate of approx 2.9 MMcf of gas and 55 Bbl of condensate per day, or 3.2 MMcfepd. This well may be fracture stimulated in the future. Abraxas Petroleum owns a 63% working interest in this well. "The production rates from the Gisler #1 are above our expectations. Even though a typical Wilcox well has a relatively steep initial decline rate, these wells are very economic and pay out quickly. We intentionally limit our exploratory budget to 20% of our overall capital expenditure budget. Our upcoming capital projects will focus on projects that are more development and exploitation in nature,"

Hearst-Argyle TV announces the acquisition of Map of Medicine (HTV) 20.73 +0.11 : Co announces the acquisition of Map of Medicine, a provider of evidence-based health-care resources designed to help health practitioners make sound decisions by following accessible clinical information on a range of relevant medical issues. Terms not disclosed.

Summary of Bernanke's prepared comments to the Joint Economic Committee : "In response to deterioration in the near-term outlook for the economy and intensified strains in financial markets, in recent months the Federal Reserve has eased monetary policy substantially further and taken strong actions to increase market liquidity. In my remarks today, I will first offer my views on conditions in financial markets and the outlook for the U.S. economy, then discuss recent actions taken by the Federal Reserve... Although our recent actions appear to have helped stabilize the situation somewhat, financial markets remain under considerable stress. Pressures in short-term bank funding markets, which had abated somewhat beginning late last year, have increased once again... Notably, in the housing market, sales of both new and existing homes have generally continued weak, partly as a result of the reduced availability of mortgage credit, and home prices have continued to fall. Starts of new single-family homes declined an additional 7 percent in February, bringing the cumulative decline since the early 2006 peak in single-family starts to more than 60 percent. Residential construction is likely to contract somewhat further in coming quarters as builders try to reduce their high inventories of unsold new homes... The unemployment rate edged down in February and remains at a relatively low level; however, in light of the sluggishness of economic activity and other indicators of a softer labor market, I expect it to move somewhat higher in coming months... I expect the tax rebates associated with the fiscal stimulus package recently passed by the Congress to provide some support to consumer spending in coming quarters... Overall, the near-term economic outlook has weakened relative to the projections released by the Federal Open Market Committee (FOMC) at the end of January. It now appears likely that real gross domestic product (GDP) will not grow much, if at all, over the first half of 2008 and could even contract slightly. We expect economic activity to strengthen in the second half of the year, in part as the result of stimulative monetary and fiscal policies; and growth is expected to proceed at or a little above its sustainable pace in 2009, bolstered by a stabilization of housing activity, albeit at low levels, and gradually improving financial conditions. However, in light of the recent turbulence in financial markets, the uncertainty attending this forecast is quite high and the risks remain to the downside... Inflation has also been a source of concern. We expect inflation to moderate in coming quarters. That expectation is based, in part, on futures markets' indications of a leveling out of prices for oil and other commodities, and it is consistent with our projection that global growth--and thus the demand for commodities--will slow somewhat during this period. And, as I noted, we project an easing of pressures on resource utilization. However, some indicators of inflation expectations have risen, and, overall, uncertainty about the inflation outlook has increased. It will be necessary to continue to monitor inflation developments carefully in the months ahead... I turn now to the Federal Reserve's policy responses to these financial and economic developments. On March 13, Bear Stearns (BSC) advised the Federal Reserve and other government agencies that its liquidity position had significantly deteriorated and that it would have to file for Chapter 11 bankruptcy the next day unless alternative sources of funds became available. This news raised difficult questions of public policy. Normally, the market sorts out which companies survive and which fail, and that is as it should be. However, the issues raised here extended well beyond the fate of one company. Our financial system is extremely complex and interconnected, and Bear Stearns participated extensively in a range of critical markets. With financial conditions fragile, the sudden failure of Bear Stearns likely would have led to a chaotic unwinding of positions in those markets and could have severely shaken confidence. The company's failure could also have cast doubt on the financial positions of some of Bear Stearns' thousands of counterparties and perhaps of companies with similar businesses. Given the current exceptional pressures on the global economy and financial system, the damage caused by a default by Bear Stearns could have been severe and extremely difficult to contain. Moreover, the adverse effects would not have been confined to the financial system but would have been felt broadly in the real economy through its effects on asset values and credit availability. To prevent a disorderly failure of Bear Stearns and the unpredictable but likely severe consequences of such a failure for market functioning and the broader economy, the Federal Reserve, in close consultation with the Treasury Department, agreed to provide funding to Bear Stearns through JPMorgan Chase (JPM)... Clearly, the U.S. economy is going through a very difficult period. But among the great strengths of our economy is its ability to adapt and to respond to diverse challenges. Much necessary economic and financial adjustment has already taken place, and monetary and fiscal policies are in train that should support a return to growth in the second half of this year and next year. I remain confident in our economy's long-term prospects."

Republic Airways reports a 30% increase in March 2008 traffic (RJET) 22.07 -0.47 : Co reported preliminary passenger traffic results for March 2008. The co generated 874.0 mln revenue passenger miles, a 30.2% increase over the same month last year, while available seat miles increased 28.7% to 1.1 bln. Block hours were 65,457 in March 2008, a 22.8% increase over March 2007. Load factor was 76.7% versus 75.8% in March 2007. A total of 1,674,324 passengers were carried during the month, a 31.8% increase over the same month last year.

Spire receives contract for combined solar module and cell line in China (SPIR) 16.77 +0.41 : Co announces it has won a contract in China for a combined solar module and solar cell facility. This order includes a 25-megawatt module factory and an adjacent 25MW solar cell factory designed to produce high efficiency multi-crystalline cells. "We are delighted to be selected, after a very competitive bidding process, by Jiangxi Gemei Sci-Tech LTD for this groundbreaking project..."

Newspaper Notable Mentions (WIRES) : FT: First Direct has suspended new mortgage lending after being swamped by applications. The decision was taken after rival banks withdrew their mortgage deals because of worsening conditions in the money markets. The bank, part of HBC, yesterday withdrew all loans to homeowners who were not already customers after it received five times the normal level of applications... WSJ: As the largest specialty-electronics retailers get set to report year-end results, recent consumer surveys and comments from a TV supplier and from club stores point to slowing TV demand. TV sales were expected to slow this year after a couple of big years tied to technology improvements and following the usual surge around the holidays, but some industry watchers suspect sales have slowed even more than anticipated... DigiTimes: Despite some industry players projecting a possible shortage of 32-inch LCD TV panels in 2008, the recent adjustments in strategy at leading panel makers and branded vendors means the situation may not be as dire as previously thought. Industry players earlier projected a shortage of 32-inch LCD TV panels because of the limited fresh capacity from major suppliers. Some even estimated that supply would fall short of demand by 30%... Oversupply of LCD panels for the TV segment, coupled with demand from top LCD TV vendors for lower-price panels to facilitate their second-quarter marketing campaigns, may prevent overall price increases for LCD panels in April, as suppliers are likely to adjust their capacity to put out more PC-use panels that offer higher profits, according to industry sources.

UniFirst beats by $0.30, beats on revs (UNF) 38.08 : Reports Q2 (Feb) earnings of $0.79 per share, $0.30 better than the First Call consensus of $0.49; revenues rose 21.6% year/year to $270.3 mln vs the $259.5 mln consensus.

S&P futures vs fair value: +1.0. Nasdaq futures vs fair value: -0.2. : Futures have come off their previous levels and now indicate a mixed start as S&P Futures lead fair value and Nasdaq Futures lag fair value.

On The Wires (WIRES) : Goodrich (GR) has been selected by Lockheed Martin to supply the air data system for the F-35 Lightning II program, which has the potential of generating $300 mln in revenue over the life of the program... Energy Partners (EPL) announces its second discovery in 2008 in the Bay Marchand field located in its Central core area on the Gulf of Mexico Shelf and has begun drilling its third well in the program.

SAP AG appoints Leo Apotheker Co-CEO (SAP) 49.65 : Co announces the appointment of SAP Deputy CEO Leo Apotheker as the company's co-CEO alongside SAP CEO Henning Kagermann, effective immediately.

Commscope reaffirms FY08 outlook at industy conference (CTV) 36.99 : Co reaffirms guidance for Q1 (Mar), sees Q1 (Mar) revs of $950-970 mln vs. $964.72 mln First Call consensus. Co reaffirms guidance for FY08 (Dec), sees FY08 (Dec) revs of $4.1-4.3 bln vs. $4.23 bln consensus.

Harris Stratex awarded $9.1 mln emergency communications network wireless transmission contract by the city of San Jose, CA (HSTX) 10.23 : Co announces a new $9.1 mln contract with the City of San Jose, California to engineer, install, integrate and provision the Emergency Communications private microwave radio network. Under the terms of the agreement, Harris Stratex Networks also will supply full maintenance support and services for the ECOMM network during its first year of operation.

Sempra Energy initiates a $1 bln share repurchase program (SRE) 54.31 :

S&P futures vs fair value: +1.8. Nasdaq futures vs fair value: +2.0. : U.S. stocks are on track to begin the session for the better. The major Asian indices registered an impressive performance Wednesday. The Nikkei finished up 4.2% and the Hang Seng finished 3.2% higher. Optimism is also prevailing in Europe, the DAX is up 0.8% and the FTSE is up 0.6%.

On The Wires (WIRES) : Reliance Steel & Aluminum (RS) announces that on April 1, 2008, it acquired Dynamic Metals International. Dynamic's 2007 revs were approximately $11 mln... Kenexa (KNXA) announces its acquisition of Quorum International, a co providing recruitment process outsourcing services in Europe, the Middle East and Africa. Financial details of the transaction were not disclosed.

Southwest Air announced today it flew 6.7 bln revenue passenger miles in March 2008, a 9.8% increase YoY (LUV) 12.75 : Co announces that it flew 6.7 bln revenue passenger miles in March 2008, a 9.8% increase from the 6.1 bln RPMs flown in March 2007. Available seat miles increased 5.3% to 8.7 bln from the March 2007 level of 8.3 bln. The load factor for the month was 76.5%, compared to 73.3% for the same period last year.

On The Wires (WIRES) : In connection with Clear Channel Communications' (CCU) previously announced tender offer for its outstanding 7.65% Senior Notes due 2010 and its subsidiary AMFM Operating's previously announced tender offer for its outstanding 8% Senior Notes due 2008, the co announces that it has extended the date on which the tender offers are scheduled to expire from 8:00 a.m. New York City time on April 4, 2008 to 8:00 a.m. New York City time on April 11, 2008... St. Jude Medical (STJ) announces regulatory approval from the Japanese Ministry of Health, Labour and Welfare for the Merlin Patient Care System... Raser Technologies (RZ) announces that it has initiated the development of an additional geothermal project in Utah... Deere & Company (DE) announces plans to significantly expand its presence in Russia...China Direct (CDS) announces it has received approval from the NASDAQ Stock Market for its common shares to be listed on the NASDAQ Global Market... EnerNOC (ENOC) announces a 5-yr contract with the Ontario Power Authority to provide demand response capacity in the Greater Toronto Area, Waterloo Region and City of Hamilton.

Alfacell updates status of ONCONASE phase III clinical program; confirms 316 deaths (ACEL) 2.41 : Co announced that it has confirmed that 316 evaluable events (patient deaths) have occurred in the confirmatory Phase IIIb clinical trial of its lead compound, ONCONASE, for the treatment of patients with unresectable malignant mesothelioma. In accordance with the statistical plan for the trial, the company has begun the process necessary to conduct the formal statistical analyses required to complete the final sections of the ONCONASE rolling New Drug Application.

S&P futures vs fair value: +3.5. Nasdaq futures vs fair value: +2.5. : Futures continue to indicate an upside open. Both Best Buy (BBY 43.47) and Monsanto (MON 113.13) announced EPS results this morning that topped consensus EPS estimates.

IntercontinentalExchange reports record ADV and OTC commissions for First Quarter 2008; ADV future volume exceeds 1 mln (ICE) 139.11 : Total ADV for all ICE Futures contracts reached 1,031,683 in March 2008, an increase of 42% over March 2007. Total ADV for all ICE Futures contracts reached 1,004,713 in the first quarter. Average daily commissions for ICE's global OTC business more than doubled to $1,324,510, a 124% increase over March 2007, and the third consecutive month surpassing $1 mln per day.

CGI Group: Revenu Quebec awards CGI $40 mln in consulting contracts (GIB) 10.95 : Co announces that it has won consulting contracts awarded by Revenu Quebec worth more than $40 mln. Under the terms of the contracts, GIB will work with Revenu Quebec to improve the government's existing personal income tax system and will develop a new system.

Hain Celestial announces the acquisition of Daily Bread; expected to be accretive (HAIN) 30.35 : Co announces the acquisition of Daily Bread, a London-based producer of branded fresh prepared foods for the foodservice channel in the United Kingdom. Daily Bread generated ~ $24 mln in continuing sales in its last fiscal year. Terms of the acquisition were not disclosed. The transaction is expected to be accretive to Hain Celestial's earnings during its fiscal year 2009.

S&P futures vs fair value: +4.4. Nasdaq futures vs fair value: +2.8. : Futures indicate a more positive start following the latest ADP Employment Report. The March ADP Employment Report indicated jobs grew by 8,000 in the private sector. The consensus estimate called for a loss of 45,000. February's rate was revised to a drop of 18,000 from a drop of 23,000.

Equity futures tick up to pre-mkt highs on better than expected ADP Employment number... SPX futures gain about 4 pts on the data, now +5 pts :

On The Wires (WIRES) : Park Electrochemical (PKE) announces that its new wholly owned subsidiary, Park Aerospace Structures, has purchased substantially all the assets and business of Nova Composites... Veeco Instruments (VECO) announces that Millenium Communication of Hsinchu, Taiwan has ordered a TurboDisc E450 arsenic phosphide Metal Organic Chemical Vapor Deposition System for production of high-efficiency III-V compound multi-junction solar cells... Chartered Semiconductor Manufacturing (CHRT) announces the extension of its joint development collaboration with IBM (IBM) to include 22-nanometer bulk complementary metal oxide semiconductor technology. Financial terms were not disclosed... Abraxis BioScience (ABII) announces it has initiated enrollment in its Phase II clinical trial to evaluate the efficacy and safety of Coroxane for the prevention and reduction of restenosis following revascularization of the superficial femoral artery... Brightpoint North America, a subsidiary of Brightpoint (CELL), has entered into a Logistics Fulfillment and Services agreement with Sprint's XOHM business unit in support of their upcoming launch of a next generation mobile WiMAX network.

Monsanto beats by $0.07, beats on revs; reaffirms FY08 EPS guidance (MON) 113.13 : Reports Q2 (Feb) earnings of $1.79 per share, excluding non-recurring items, $0.07 better than the First Call consensus of $1.72, compared to 03/25 guidance of EPS in the range of $1.75; revenues rose 44.8% year/year to $3.78 bln vs the $3.6 bln consensus. Co reaffirms guidance unchanged from the guidance given 3/25 when MON raised 2008 guidance, sees EPS of $3.15-3.25, excluding non-recurring items, vs. $3.20 consensus. Between Y07 and the end of Y12, co expects to effectively double the gross profit potential of its business. Co also announces its intention to make an investment of up to $196 mln over the next 18 months at its glyphosate manufacturing facility in Luling, Louisiana. The planned development will increase its global capacity to produce Roundup and other glyphosate-based herbicides.

S&P futures vs fair value: +0.3. Nasdaq futures vs fair value: -1.0. : Futures currently indicate a mixed start, but the major world indices extend their rallies into Wednesday. The Dow Jones World Index, excluding the U.S., is up 1.9%. The Wall Street Journal reports that National City (NCC $9.99) is considering selling itself to KeyCorp (KEY $23.49).

Monsanto announces planned expansion at its facility in Louisiana (MON) 113.13 +0.18 : The co announces its intention to make an investment of up to $196 mln over the next 18 months at its glyphosate manufacturing facility in Luling, Louisiana. The planned development will increase its global capacity to produce Roundup and other glyphosate-based herbicides. In addition to the planned expansion, Monsanto announces that it will be undertaking an energy-reduction project at its Luling facility. The co will be implementing a hydrogen-recovery project, a step that will enable it to reduce natural gas costs and better conserve and utilize hydrogen, a by-product of the glyphosate manufacturing process.

iMergent reaches settlement with the state of Connecticut; continues doing business in Connecticut (IIG) 11.83 : Under the terms of the settlement and without an admission of any liability, iMergent refunded certain customers approximately $65,000 and agreed to pay the state of Connecticut's costs of approximately $65,000. The company also agreed to make certain disclosures regarding the software sold and certain disclosures related to sales representations made by the company.

Suntech Power to supply 4MW of modules to 'leading' Italian PV system developer Enerray (STP) 41.47 : Co announces a 4MW module supply agreement with Enerray, an Italian designer, developer and manager of photovoltaic systems. The Suntech modules will be installed by Enerray in PV systems for the rooftops of large Italian industrial complexes. "We are experiencing significant demand for the deployment of commercial rooftop solar systems," said Eng. Marco Ghirardello, CEO of Enerray. "As one of Italy's leading installers of photovoltaic systems, we have chosen to partner with the well respected Suntech brand to bring their superior quality solar products to key projects in high commerce cities across Italy."

Optimer Pharma announces peer-reviewed publication of OPT-80 Phase 1 clinical results for the treatment of clostridium difficile infection (OPTR) 6.29 : Co announces the publication of its Phase 1 clinical trials of OPT-80 in the April 2008 edition of Antimicrobial Agents and Chemotherapy published by the American Society for Microbiology. The results from these studies support the development of OPT-80 as an oral therapy for Clostridium difficile infection, or CDI. OPT-80 is currently being tested in Phase 3 clinical trials for CDI, also known as Clostridium difficile-associated diarrhea. The paper highlights previously reported data from a Phase 1a single-dose and a Phase 1b multiple-dose trial of OPT-80 for the treatment of CDI. In both the single-dose and the multiple-dose studies, OPT-80 was well tolerated by all subjects and no drug-related adverse events were observed. OPTR believes that in the Phase 1 studies, OPT-80 also exhibited a favorable pharmacokinetic profile for CDI treatment.

InterMune provides additional information on ITMN-191 MAD study results (ITMN) 17.29 : The co provides additional information on its Phase 1b multiple-ascending-dose study of ITMN-191 to facilitate comparison with previously published data describing other HCV protease inhibitors. For cohort 1, the dose was 100 mg q12h, total daily dose was 200, mean maximum reduction was 1.6 (97.49%) and day 14 median reduction was 0.7 (80.05%).


Chevron: Independent expert has proposed that Chevron pay a minimum of $7 bln and up to $16 bln to compensate for environmental contamination (CVX) 86.74 : In a long-awaited court report submitted as part of the final phase of a trial, an independent expert has proposed that Chevron (CVX) pay a minimum of $7 bln and up to $16 bln to compensate for environmental contamination caused to Ecuador's Amazon rainforest during a 26-year period when the oil giant operated a large concession in the country. If the assessment is accepted by the court, the subsequent judgment likely would be the largest civil damages awards in an environmental case. The higher $16 bln figure could result if the court accepts an "unjust enrichment" penalty tied to Chevron's actual cost savings over several

Emcore receives $4.6 mln follow-on order for concentrator solar cell receiver assemblies from Concentration Solar la Mancha (EMKR) 5.90 : The co announces that it has been awarded a $4.6 mln follow-on production order for solar cell receiver assemblies from Concentration Solar la Mancha of Manzanares, Spain. The receivers will be incorporated into CS la Mancha's 500X concentrator photovoltaic system and will be deployed throughout Spain and other locations in fully licensed and funded projects. Shipments are scheduled to commence in the September quarter and complete in early 2009.

Sinovac Biotech receives China State Food and Drug Administration approval for pandemic influenza H5N1 vaccine (SVA) 3.83 : Co announces that Panflu, its pandemic influenza H5N1 whole viron inactivated vaccine, has been granted a production license by the China State Food and Drug Administration. Panflu is the first and only approved vaccine available in China against the H5N1 influenza virus. The vaccine is approved for production solely to be supplied to the Chinese national vaccine stockpiling program and will not be sold directly to the market. The license also indicates that the Chinese government has the exclusive right to initiate Panflu vaccinations in an emergency or in the event of an influenza pandemic.

Sirtris Pharma receives orphan drug designation from FDA for Resveratrol in Mitochondrial Disorder, MELAS syndrome (SIRT) 13.85 : Co announces that the United States Food and Drug Administration has granted the co orphan-drug designation for resveratrol in the treatment of MELAS syndrome. Orphan-drug designation for resveratrol in MELAS syndrome provides Sirtris with seven years of marketing exclusivity upon receipt of FDA approval.

On The Wires (WIRES) : Trina Solar Limited (TSL) announced that the co has signed a long-term polysilicon supply agreement with a subsidiary of GCL Silicon Technology Holdings... CBIZ (CBZ) announces that it has acquired EFL Associates, effective April 1, 2008. EFL recorded approx $4.8 mln in revenue during 2007 and has approx 34 associates.

7:37AM Verifone reaffirms Q4 and FY07 revenues (PAY) 16.83 : Co expects to report revenues for the three months ended October 31, 2007, of $238.9 mln (vs $237.27 mln First Call consensus), consistent with its December 3, 2007, announcement of the anticipated restatement. For the full year ended October 31, 2007, VeriFone expects to report net revenues of $903.9 mln (vs $903.15 mln First Call consensus), also consistent with the information reported on December 3, 2007.

On The Wires (WIRES) : ZBB Energy (ZBB) announces that as part of its efforts in the alternative energy sector, its ZESS 50 fuel cell zinc energy storage system has been chosen to provide a key element in the Zero Net Energy, Future House USA home that will be on display at the Beijing Olympic Games in August 2008... CBIZ (CBZ) announces that it has acquired EFL Associates, effective April 1, 2008. EFL recorded approx $4.8 mln in revenue during 2007 and has approx 34 associates.

Lululemon Athletica beats by $0.02, beats on revs; guides FY09 EPS in-line; appoints new COO & CEO designate (LULU) 31.57 : Reports Q4 (Jan) earnings of $0.21 per share, $0.02 better than the First Call consensus of $0.19; revenues rose 101.3% year/year to $105.1 mln vs the $92.7 mln consensus. Co issues in-line guidance for FY09, sees EPS of $0.72-0.74, excluding $0.02 charge resulting from the Company's planned closure of its four stores currently operating in Japan, vs. $0.72 consensus. Co said, "While the current overall consumer environment may be challenging, the increasing loyalty of our guests and our unique positioning in the historically resilient active and healthy-lifestyle market, are providing for continued acceptance of our brand." Co also announced the appointment of Christine Day as President, Chief Operating Officer and CEO designate. Robert Meers will be retiring from his position as CEO on June 30, 2008, at which time Ms. Day will assume this role.

Verifone completes independent investigation (PAY) 16.83 : The co announces that its Audit Committee has completed its independent investigation into certain accounting and financial control matters... The restatements will correct the accounting errors that were identified by mgmt... the restatements are expected to have the following effects: 1) Previously reported inventories will be reduced by approximately $13.3 mln, $23.9 mln and $40.6 mln as compared to originally reported amounts at January 31, 2007, April 30, 2007, and July 31, 2007; Previously reported operating income will be decreased by approximately $12.5 mln, $9.8 mln and $14.7 mln as compared to originally reported amounts for the three months periods ended January 31, 2007, April 30, 2007, and July 31, 2007, principally due to higher cost of net revenues as compared to originally reported amounts. 3) The aggregate decrease in operating income for the nine months ended July 31, 2007, of approximately $36.9 million, as determined through the Audit Committee investigation, represents an increase of approximately $7.2 mln compared to the original estimate of approximately $29.7 mln reported on December 3, 2007.

Medcath announces acquisition of ownership in Arizona Cath Lab; anticipates joint venture will add ~$0.05/share in earnings annually (MDTH) 18.78 : Co announces that MedCath Partners has acquired a 27.4% interest in a joint venture known as Southwest Arizona Heart and Vascular Center. The joint venture provides cardiac catheterization lab services to Yuma Regional Medical Center under a Management and Service Agreement with the Hospital. Co acquired its 27.4% interest for $8.5 mln and anticipates that the joint venture will add ~$0.05 in diluted earnings per share annually.

LaserCard says the US Dept of Homeland Security orders its encoding solution for green cards (LCRD) : Co announced that it has received a purchase order to supply a next generation card encoding solution for the Department of Homeland Security's (DHS) U.S. Permanent Resident Card ("Green Card") Program. Under the terms of the purchase order, received from DHS U.S. Citizenship and Immigration Service's Prime Contractor, LaserCard will supply 40 next generation encoders, associated software and services. The new solution will replace "Green Card" personalization equipment which is more than a decade old. The encoders and software, valued at approximately $170,000, are expected to be delivered over the next six months.

Medical Action announces the hiring of Charles Kelly as Chief Financial Officer (MDCI) 17.00 : Co announced that it has hired Charles Kelly as its Chief Financial Officer. A certified public accountant with over 25 years of financial management experience, including more than 10 years with a big four public accounting firm, Mr. Kelly will be joining Medical Action as of April 7, 2008.

On The Wires (WIRES) : THQ (THQI) announced the acquisition of the Elephant Entertainment casual and online games business. In conjunction with this acquisition, THQI also announced an exclusive, worldwide retail publishing agreement with Oberon Media, the world's leading cross-platform casual games company. Terms not disclosed... Smith Micro Software (SMSI) announced it has received a Notice of Allowance from the U.S. Patent and Trademark Office for a patent on technology that enables management of computer systems and network infrastructure from handheld mobile devices... Aetna (AET) announced that it has closed a new $1.5 bln five-year credit facility with 21 domestic and foreign financial institutions. The new bank facility amends, restates and supersedes Aetna's existing $1.0 bln five-year revolving credit agreement.

On The Wires (WIRES) : iRobot (IRBT) disclosed in 8-k that Colin Angle, Chief Executive Officer of the Company, entered into trading plans for himself and his family trust adopted pursuant to Rule 10b5-1... General Mills (GIS) disclosed in 8-k that the Chief Executive Officer, Kendall J. Powell, established a trading plan in accordance with Rule 10b5-1... Nordic American Tanker Shipping (NAT) announced that earnings and dividend payments for the Q1 of 2008 can be expected to be appreciably higher than Q4 of 2007. NAT will be able to declare dividend to shareholders which can be expected to exceed $1.00 for the first quarter, up from previous dividend of $0.50.

Thompson Creek announces Davidson Deposit feasibility study (TC) 18.46 : The Davidson Deposit feasibility study estimates that the development of the Davidson Deposit would require a capital expenditure of C$109 mln. Molybdenum production is estimated at approximately 4 mln pounds per year over a 10-year period. The average annual cash costs are estimated to be US$9.46 per pound. The estimated pre-tax I.R.R is 20% and payback is 3.4 years from the start of full production at the assumed molybdenum prices including a long-term price of US$14 per pound starting in 2012. The sensitivity analysis shows the I.R.R would increase to 43% if molybdenum prices are 20% higher than assumed.

PMC-Sierra appoints President and CEO Greg Lang (PMCS) 6.05 : The co announces that Greg Lang has been appointed as the co's president and chief executive officer. The position will become effective immediately upon the resignation of Robert Bailey as the co's president and chief executive officer following the filing of the Company's first quarter 2008 financials Form 10-Q, which will be on or before May 9, 2008. Prior to his appointment at PMC-Sierra, Mr. Lang was president and CEO at Integrated Device Technology.

On The Wires (WIRES) : Caterpillar (CAT) announced price actions of up to 5% on products worldwide. This action includes adjustments to list prices and merchandising support. This price action is a result of current general economic conditions and industry factors... Century Aluminum Company (CENX) announced that it has entered into a joint venture agreement with Pingguo Qiangqiang Carbon to acquire a 40% stake in Baise Haohai Carbon, which owns a newly constructed carbon anode and cathode facility located in the Guangxi Zhuang Autonomous Region of south China... Cell Therapeutics (CTIC) announced that the European Medicines Agency has accepted for review CTI'Cs Marketing Authorization Application for XYOTAX for first-line treatment of patients with non-small cell lung cancer with Eastern Cooperative Oncology Group performance status 2.

Alaska Comms to acquire Crest Communications (ALSK) 12.48 : Co announces that it has entered into an agreement to purchase Crest Communications, owner and operator of the North Star submarine fiber-optic cable. ALSK expects the acquisition will provide it with a new source of cash flows: $11 mln in annual recurring revenue; an EBITDA contribution from recurring revenue of $3 mln annually; and additional non-recurring IRU sales that have averaged approximately $9 mln per annum. The co expects the Crest acquisition to provide cost synergies of approximately $1 mln per annum in operating expenses for AKORN. ALSK plans to fund a substantial portion of the purchase price from cash on hand, cash flow from operations and by drawing up to $20 million on its existing revolving credit facility.

Synnex completed acquisition of New Age Electronics, raised guidance (SNX) 22.08 : Co updated its guidance to include the New Age acquisition. New Age will contribute approximately nine weeks of financial results to SYNNEX' fiscal 2008 second quarter. Co raised Q2 guidance, sees EPS $0.51-0.53 vs $0.51 First Call consensus (up from previous guidance of $0.50-0.52 ); revs $1.845-1.915 bln vs $1.75 bln First Call consensus (up from previous revs guidance of $1.715-1.785 bln).

On The Wires (WIRES) : Nanogen (NGEN) and Thermo Fisher Scientific have entered into an agreement in which Thermo Fisher will be the exclusive provider of a variety of products used in gene-expression experiments...China Nepstar Chain Drugstore (NPD) announces that it has signed an agreement with Shenzhen Tong TransCard under which Nepstar will install TransCard POS equipment in all Shenzhen outlets to enable customers to make purchases with or recharge their TransCards... EntreMed (ENMD) announces that it has commenced a Phase 1, open-label, continuous dosing study with its oral cell cycle inhibitor, MKC-1, in patients with advanced or metastatic solid tumors.

Great Plains Energy announces definitive agreement for sale of Strategic Energy (GXP) 25.16 : Co announces that it has today signed an agreement to acquire Strategic Energy, a subsidiary of Great Plains Energy Inc. (GXP), for a total cash consideration of $300 mln. The transaction is debt free and includes an amount of working capital which will be subject to a subsequent true-up.

MF Global names J. Randy MacDonald Chief Financial Officer (MF) 10.54 +0.63 : Co announces that its Board of Directors has named J. Randy MacDonald chief financial officer. Ira Polk, who has been serving as interim CFO, will continue his role as chief administrative officer.

Argonaut Group announces offer for Heritage Underwriting Agency (AGII) 3619 : Co announces an offer to acquire Heritage Underwriting Agency in a $272 mln all-cash transaction.

UAL Corp advises customers of some delays and cancellations today (UAUA) 23.13 : United Airlines is informing customers traveling on April 2, 2008 on United's Boeing 777 aircraft that they may experience flight delays or cancellations as a result of a functional check being performed on the aircraft. As part of a regular review of maintenance records, the co discovered that the functional test that checks the firing system on one of the five bottles in the cargo fire suppression system on the Boeing 777 was not performed, and this was voluntarily disclosed to the FAA. United is in the process of checking this part of the system. This system is regularly tested as part of the pre-flight safety checks. These checks are related to compliance. United will not operate these aircraft until the tests are complete.

Pharsight Corp announces that two 'Top 25' global pharmaceutical companies have become customers for its Drug Model Explorer software (PHST) 5.15 :

S&P futures vs fair value: -7.5. Nasdaq futures vs fair value: -12.0. :

European Markets : FTSE...5852.40...-0.20...0%. DAX...6738.03...+17.70...+0.3%.

Asian Markets : Nikkei...13189.36...+532.94...+4.2%. Hang Seng...23872.43...+734.97...+3.2%.

6:13AM Frontline announces resignation of Chief Executive Officer Bjorn Sjaastad (FRO) 47.07 :

On The Wires (WIRES) : Double Eagle Petroleum (DBLE) announces it reached a record level of gross sales volumes for a month from its Catalina Unit in the Atlantic Rim of Wyoming... SVB Financial (SIVB) announces that it has priced $200 mln aggregate principal amount of 3.875% convertible senior notes due in 2011.

Baidu.com appoints Peng Ye as Chief Operating Officer, effective April 25, 2008 (BIDU) 273.25 :

On The Wires (WIRES) : CryptoLogic Limited (CRYP) confirms the co will not be affected materially by a narrow vote by Dutch parliamentarians that will prevent Holland Casino from establishing an Internet gaming site... Clean Diesel Technologies, Inc. (CDTI) announces approval for the inclusion of their Purifier e4 retrofit technology in the Scottish Government Emissions Reduction Register program.

STMicroelectronics announces its Board has authorized the co repurchase up to 30 mln common shares (STM) 11.17 :

12:40AM On The Wires (WIRES) : Capital Corp of the West (CCOW) annnounces co is in the process of finalizing its audit and preparation of the 2007 Form 10-K and was unable to complete this in time for the extended deadline following its filing of Form 12b-25... CastlePoint Holdings (CPHL) doubles its quarterly dividend to $0.05 per share.

OMNOVA Solutions reports Q108 results (OMN) 3.75 : Reports Q1 (March) loss of $0.07 per share, $0.03 worse than the First Call consensus of ($0.04); revenue increased 15.7% year/year to $190.6 mln vs the $207.0 mln consensus.

Hansen Medical prices its offering of 3.0 mln shares of common stock (HNSN) 14.58 : Co announces offering was increased to 3.0 mln from 2.5 mln shares.

Alpha Natural Resources announces pricing of concurrent offerings of common stock and convertible notes (ANR) 41.29 : Co prices its 3,636,363 common share offering at $41.25/share. Co also announces pricing of its $250 mln aggregate principal amount of 2.375% convertible senior notes due 2015.

AM Monotype Imaging announces secondary offering of 6.0 mln shares of common stock (TYPE) 15.42 :

Monday, March 31, 2008

Stock Market update

The stock market closed the first quarter on a winning note, but alas, today's gains weren't enough to avoid yet another month of declines. The end result is that the S&P 500 extended its losing streak to five consecutive months - the longest such losing streak since 1990.

Monday's outing was accented by a handful of developments, the most prominent of which was a proposal put forth by Treasury Secretary Paulson to enact a sweeping overhaul of the U.S. financial regulation system.

Paulson's plan, among other things, calls for a much larger oversight role for the Federal Reserve, the merging of the Securities Exchange Commission with the Commodity Futures Trading Commission, a federal charter for insurance companies and the closure of the Office of Thrift Supervision.

The main thrust of Paulson's proposal is to streamline bureaucracy in the regulatory system. The plan, which had its roots last spring, wasn't intended to be a response to the current crisis in the financial markets. The plan itself provided some provocative talking points, yet the realization that it wasn't going to be implemented any time soon - if at all - diminished its impact on today's market.

The latter point notwithstanding, the attempt to modernize the regulatory process and make the U.S. financial system more competitive in the global marketplace did not go unappreciated.

The financial sector, rebounding from last week's losses, played a supportive role that enabled the broader market to overcome substantive declines in S&P components Merck (MRK 37.95, -6.56) and Schering-Plough (SGP 14.41, -5.06). Those stocks declined 15% and 26%, respectively, after the efficacy of cholesterol-lowering drugs Vytorin and Zetia was questioned by a panel of cardiologists who recommended prescribing the drugs only as a last resort.

Other supportive influences in Monday's trade included a decline in oil prices and a better than expected regional manufacturing report. Specifically, oil prices, which touched $106.78 early in the day, fell 3.7% to $101.74, while the Chicago Purchasing Manager's Index checked in at 48.2 versus the market's expectation for a reading of 46.0. A number below 50 still connotes contraction, so bullish enthusiasm was held in check.

On Tuesday the market will be provided some insight on national manufacturing activity in the form of the March ISM Index. Economists expect the survey to reveal an overall reading of 47.5 versus 48.3 in February; Briefing.com looks for a slightly higher reading of 48.0.

Until then investors will be left to contemplate overnight the worst quarterly performance for the market, in which the S&P 500 declined 9.9%, since 2002. Separately, the Dow Jones Industrial Average dropped 7.6%, the Nasdaq Composite declined 14.1%, the S&P 400 Midcap Index slipped 9.2% and the Russell 2000 fell 10.2%.DJ30 +46.49 NASDAQ +17.92 SP500 +7.48 NASDAQ Dec/Adv/Vol 1178/1736/1.74 bln NYSE Dec/Adv/Vol 1218/1918/1.46 bln

3:30 pm : After some choppy trading, the stock market is largely unchanged from 30 minutes ago. If the S&P 500 is unable to make a decent run in the last half-hour, it will finish the month in the red. This will mark the fifth consecutive monthly loss, which has not occurred since 1990.

First Quarter 2008 Performance Review: All ten economic sectors are set to post a loss. Technology is the worst performing sector with a 15.4% decline, with financials close behind with a 14.8% slide. Consumer staples and industrials are relative outperformers with losses of 2.7% and 4.5%, respectively.DJ30 +40.95 NASDAQ +14.54 SP500 +6.65 NASDAQ Dec/Adv/Vol 1139/1743/1.32 bln NYSE Dec/Adv/Vol 1208/1898/1.03 bln

3:05 pm : The major indices extend their decline, but remain in the green. On CNBC, the CEO of Wells Fargo (WFC 29.19, -0.16) said it is possible to have another Bear Stearns (BSC 10.39, -0.39) incident, and that the markets are very volatile.

First Quarter 2008 Performance Review: The weakness in the dollar has captured the market's attention, some arguing it is bad, and some arguing it is good. The DXY Index--a basket of major currencies compared against the dollar--is down 6.5%, which is its largest quarterly decline since 2004. Of the ten major currencies, the Swiss Franc has posted the largest gain of 14.3%. The only major currency to post a loss against the dollar is the Canadian dollar (-3.3%). In emerging currencies, the largest gainer is the Chilean Peso (+14.3%) and the largest decliner is the Iceland Krona (-16.9%). DJ30 +46.33 NASDAQ +15.06 SP500 +6.41 NASDAQ Dec/Adv/Vol 1184/1667/1.19 bln NYSE Dec/Adv/Vol 1257/1839/930 mln

2:30 pm : The major indices slip a bit, but continue to hold onto solid gains. It has been a slow news day. Within the S&P 500, 370 stocks are trending higher. General Electric (GE 37.15, +0.54) is providing leadership, while Merck (MRK 37.96, -6.55) is the worst performing name.

First Quarter 2008 Performance Review: The S&P 400 Mid Cap Index is down 9.4%. Its best performing stock is homebuilder Hovnanian (HOV), up 48.0%. PMI Group (PMI) is down 56.1%, making it the worst performing stock.DJ30 +70.42 NASDAQ +21.79 SP500 +9.08 NASDAQ Dec/Adv/Vol 1105/1729/1.08 bln NYSE Dec/Adv/Vol 1186/1889/845 mln

2:00 pm : Buying interest fades, but selling interest has not picked up much either as the major indices trade modestly below their best levels. This session's gains have sent the Dow and Nasdaq into positive territory for the month, although the S&P 500 is still posting a slight loss.

First Quarter 2008 Performance Review: Seven of the 30 Dow components have posted a gain. Wal-Mart (WMT) is up 11.6%, making it the best performing component. Merck (MRK) is the worst performing component with a 35.0% decline.DJ30 +85.59 NASDAQ +24.80 SP500 +10.66 NASDAQ Dec/Adv/Vol 1089/1741/977 mln NYSE Dec/Adv/Vol 1127/1943/762 mln

1:35 pm : The stock market climbs higher. Market breadth is positive with advancers outpacing decliners by 9-to-5, and by more than 3-to-2 on the Nasdaq. Meanwhile, crude continues to tumble on no apparent news. It is now down 4.2% to $101.22 per barrel.

First Quarter 2008 Performance Review: The small-cap Russell 2000 Index (-9.6%) is performing on par with its large-cap counterparts. Encysive Pharmaceuticals (ENCY) is its best performing stock, with a 175.3% advance. Keryx Biopharmaceuticals (KERX) saw the steepest drop of 92.9%.DJ30 +103.23 NASDAQ +27.96 SP500 +12.91 NASDAQ Dec/Adv/Vol 1063/1749/898 mln NYSE Dec/Adv/Vol 1052/1985/698 mln

1:00 pm : The major indices are trading at their best levels of the session. Telecom (+2.5%) is posting the largest gain, although financials (+2.2%) are having the most influence due to their heavy weighting. Investment banks & brokerages (+3.3%) is the best performing financial group, although it is still down 8.6% over the last five sessions.

First Quarter 2008 Performance Review: The Nasdaq 100 is down 14.7%. Its best performing component is biopharm company Celgene (CELG), with a 31.9% gain. The worst performing stock is GPS maker Garmin (GRMN) with a 44.3% drop.DJ30 +73.22 NASDAQ +20.17 SP500 +10.27 NASDAQ Dec/Adv/Vol 1120/1666/801 mln NYSE Dec/Adv/Vol 1106/1918/932 mln

12:30 pm : The major indices are off their best levels, but are holding onto decent gains. The CRB Commodity Index (-1.6%) has taken a turn south in conjunction with crude oil (-3.4% to $101.99). Gold is now down 0.9%.

The reversal in crude prices has taken a toll on the energy stocks. The energy sector is now up only 0.2% after being up as much as 1.7% in earlier trade.

First Quarter 2008 Performance Review: The CRB Commodity Index is posting a gain of 8.2%, which is its largest in 2.5 years. However, the index is well off its best levels of the quarter when it was up 17.7%. Natural gas has seen the largest gain of 31.9%, while cattle are posting the largest loss of 15.7%. Crude oil is up 7.7%, but was up as much as 16.5% when it hit its all-time high of $111.80 per barrel.DJ30 +66.44 NASDAQ +14.71 SP500 +8.52 NASDAQ Dec/Adv/Vol 1193/1564/736 mln NYSE Dec/Adv/Vol 1188/1828/577 mln

12:05 pm : The final day of trade in first quarter 2008 has been a positive one, although news has been relatively slow. At midday, the stock market is posting a healthy gain of 0.7%, near its best levels of the session. Topping headlines is a plan to overhaul financial regulation, and news that two popular cholesterol fighting drugs may not be effective.

Treasury Secretary Henry Paulson outlined his proposal to revamp financial regulation by streamlining current bureaucracy. The Federal Reserve would have increased power, and several regulatory agencies would be combined. Paulson noted the plan is not in response to the current market turmoil, and will not be completed this year.

Shares of Merck (MRK 38.04, -6.47) are posting their largest one-day percent decline since 2002, and shares of Schering-Plough (SGP 14.40, -5.07) are down the most ever on news that their popular cholesterol fighting drugs may not be effective. According to reports, a panel of cardiologists said the two drugs—Vytorin and Zetia—should only be used as a last resort. The combined sales of the drugs were roughly $5 billion in 2007.

Eight of the ten sectors are trending higher, led by a 1.9% gain in financials. Healthcare (-1.0%) is the main laggard.

In economic news, the Chicago PMI—a regional manufacturing survey—rose to 48.2, from 44.5. This was better than the expected reading of 46.0. However, the reading is still below 50, which indicates deteriorating manufacturing condition in the Chicago region.

Crude oil prices are down 3.0% to $102.40 per barrel, after being up as much as 1.1% in earlier trade. Currently, there is no apparent news item for the quick reversal and it may be a technical based move.

First Quarter 2008 Performance Review: The U.S. stock market’s weakness has garnered a lot of negative press, although it is actually outperforming most of the major world stock markets. The S&P 500’s 9.8% drop is better than returns on France’s CAC (-16.2%), Germany’s DAX (-19.0%), London’s FTSE (-11.7%), Japan’s Nikkei (-18.2%), China's CSI 300 (-29.0%) and Hong Kong’s Hang Seng (-17.8%).
DJ30 +67.66 NASDAQ +15.98 SP500 +9.02 NASDAQ Dec/Adv/Vol 1145/1574/636 mln NYSE Dec/Adv/Vol 1148/1822/495 mln

11:35 am : The stock market hits its best level of the session, although its overall advance is modest. Only healthcare (-1.0%) remains in the red, due to weakness in Merck (MRK 38.03, -6.48) and Schering-Plough (SGP 14.48, -4.99). Merck is posting its largest one day percent decline since 2004, and Schering is posting is largest loss ever on news that the effectiveness of their popular cholesterol drugs has been questioned.

First Quarter 2008 Performance Review: Of the 90 primary world stock market indices, 21 have posted a gain. Ghana is leading the way with a 15.4% advance. The Vietnam Stock Index is the worst performing with a 44.2% drop.DJ30 +50.80 NASDAQ +12.23 SP500 +7.78 NASDAQ Dec/Adv/Vol 1201/1478/552 mln NYSE Dec/Adv/Vol 1187/1738/426 mln

11:00 am : The major indices are trading with a slight gain. The financial sector (+1.4%) is now the best performing sector, as it trades at its best level of the session. Paulson has finished his speech on his proposal to overhaul regulation on U.S. financial markets.

First Quarter 2008 Performance Review: The best performing S&P 500 industry group has been trucking (+29%)--its only component is Ryder System (R).DJ30 +12.13 NASDAQ +6.64 SP500 +4.58 NASDAQ Dec/Adv/Vol 1235/1401/454 mln NYSE Dec/Adv/Vol 1263/1628/346 mln

10:35 am : After some choppy action, the Dow falls into the red, and the Nasdaq and S&P fall to the unchanged mark. Treasury Secretary Paulson is outlining his plan to overhaul financial regulation. He noted that this task will take a long time, and will not be completed this year.

Five sectors remain in the green. The energy sector (+1.5%) has taken the top leadership spot as crude oil is up 1.0% to $106.60 per barrel.

First Quarter 2008 Performance Review: Of the S&P 500's 130 industry groups, 109 have posted a loss. The worst performing group is education services (-41%), which got clipped after traders were displeased with results from for-profit education provider Apollo (APOL).DJ30 -17.01 NASDAQ +3.01 SP500 +2.12 NASDAQ Dec/Adv/Vol 1302/1238/338 mln NYSE Dec/Adv/Vol 1331/1480/259 mln

10:10 am : All three major indices are now in the green. Eight of the ten sectors are posting a gain. Telecom (+1.2%) and energy (+1.2%) are showing the most strength. Healthcare (-1.3%) is the main laggard.

The Chicago PMI, a regional manufacturing survey, came in at 48.2. This was higher than the expected reading of 46.0, and higher than the prior reading of 44.5.

First Quarter 2008 Performance Review: The S&P 500 is down 10.2%. The worst performing stock is Bear Stearns (BSC) with a 88% decline. Rumors of liquidity problems caused a run on the bank, causing it to sell itself to JPMorgan for $2 per share to avoid bankruptcy. The offer was later raised to $10 per share.DJ30 +4.89 NASDAQ +10.35 SP500 +3.30 NASDAQ Dec/Adv/Vol 1015/1436/222 mln NYSE Dec/Adv/Vol 1112/1634/176 mln

09:40 am : The major indices open in mixed fashion on a slow news day. Topping headlines is news that Treasury Secretary Henry Paulson is going to outline a proposal that will give the Federal Reserve more power. This has made a nice talking point, but since there is nothing concrete it has had limited effect on stock prices.

Shares of Merck (MRK) and Schering-Plough (SGP) are under pressure on news that a panel of cardiologists questioned the effectiveness of cholesterol-lowering drugs Vytorin and Zetia.

Today marks the last day of first quarter 2008. Unless stocks make some incredible gains this session, this quarter will mark the largest percent decline for the S&P 500 since 2002.

First Quarter 2008 Performance Review: Only 110 S&P 500 stocks are in the green. The best performing S&P 500 stock has been Big Lots (BIG) with a 40.2% gain.DJ30 -10.58 NASDAQ +6.16 SP500 +0.47

09:18 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: +4.0.

09:02 am : S&P futures vs fair value: -1.5. Nasdaq futures vs fair value: +3.8. Futures slip a bit. The S&P 500 is poised for a slightly lower open, while the Nasdaq is set for a slightly higher open. Merck (MRK) is down 11% in pre-market trading and Schering-Plough (SGP) is down 22% on news that a panel of cardiologists questioned the effectiveness of cholesterol-lowering drugs Vytorin and Zetia.

08:31 am : S&P futures vs fair value: +0.8. Nasdaq futures vs fair value: +7.8. Futures indicate a positive open. Asian markets had steep declines, with the Hang Seng falling 1.9% and the Nikkei shedding 2.3%. European market's were trading lower, but are now trading in mixed fashion.

08:00 am : S&P futures vs fair value: +1.8. Nasdaq futures vs fair value: +9.2. Futures suggest a modestly higher opening on the last trading day of the first quarter. According to reports, Treasury Secretary Hank Paulson will outline a plan today that will increase the Federal Reserve’s power. On the economic front, the March Chicago PMI is set for release at 9:45 ET.

06:19 am : S&P futures vs fair value: -2.4. Nasdaq futures vs fair value: -2.0.

06:18 am : FTSE...5659.20...-33.70...-0.6%. DAX...6469.36...-90.54...-1.4%.

06:18 am : Nikkei...12525.54...-294.93...-2.3%. Hang Seng...22849.20...-436.75...-1.

Fed interest-rate cuts

In a gloomy market, where the headlines have been dominated by crisis and interest-rate cuts, a lot of consumers have figured that they would at least get some payback when the rate cuts hit home.

For that to happen, however, consumers are going to have to work for it and make some moves that they might not have been expecting.

But what the rate situation is making plain is that for any consumer carrying debt and nervous about the stock market and inflation the best way to increase net worth is likely to come from refinancing and paying off debt.

That said, it won't be mortgages that lead the way in refinancing. Mortgage rates tend to be tied more to Treasury yields than to the short-term rates that the Federal Reserve is cutting, so while consumers may expect a Fed cut to help them out at home, there's no guarantee.

In general, long-term rates like mortgages move in sync with short-term rates because the cuts are being made in order to help a slowing economy; what makes today's situation different is that the cuts are being made to stem a financial crisis that occurred without a recession. Lacking that downward stimulus, longer-term rates have not followed the short-term made-to-bail-out-the-market-now trend.

The only plus for consumers is that rates on adjustable-rate mortgages have dropped, so that the mortgage resets that were expected to crush consumers -- as debts they took on a few years back were repriced to much higher levels -- have actually not been such a big burden. In some cases, the reset rate has actually been better than the introductory rate.

"This has helped people who got into trouble with ARMs," says Greg McBride, senior financial analyst for BankRate.com, "but for almost every other consumer, this news hasn't been so good."

The one sure outcome of a Fed rate cut is that savings rates are going down. For savers, that has dropped rates on certificates of deposit and money-market accounts back towards the record lows they didn't expect to see for awhile. The average one-year CD is now paying 2.89%, down from just over 3% a week ago and likely to fall further before stabilizing.

"Savers are watching two things happen right before their eyes," McBride says. "First, they are seeing savings rates go back to levels where they have to wonder if it's worth it, and they are watching each rate cut fuel inflation, which makes it harder for their savings to keep pace with inflation."

In fact, most savings vehicles currently lag inflation, meaning that the nervous investor who wants to find a safe haven to avoid principle risk in the stock market is, in fact, embracing purchasing-power risk -- the chance that their money will lag inflation -- if they move money into savings vehicles.