Trading for the Masses

Top economist says America could plunge into recession

Huijin to inject $20b into China Development Bank

Bin Laden remarks make Gulf dollar peg likelier

2008 ETF Predictions

Wall St. Way: Smart People Seeking Dumb Money

Cramerica: The Future of Business

Kass’ 20 Surprises for 2008

More on System Blends and Low De-Trended Correlation

09:19 WIRES On The Wires

Third Wave Technologies (TWTI) announces that the co has achieved the subject enrollment goals for its HPV-products clinical trial… Cytokinetics (CYTK) announces the initiation of an open-label, non-randomized Phase I/II clinical trial designed to evaluate ispinesib monotherapy as a first-line treatment in chemotherapy-naive patients with locally advanced (Stage IIIB) or metastatic (Stage IV) breast cancer.
09:15 TECHX Market View: Support and Resistance -Technical-

The market averages are pointing to a weaker start to the day. For a look at the short and long term view of the S&P 500 as well as the support/resistances of interest today for the major averages as well as the QQQQ, SMH and Russell 2000 go to The Technical Take.
09:15 S&P futures vs fair value: -4.7. Nasdaq futures vs fair value: -9.0.
09:13 WIRES Newspaper Notable Mentions

NY Times: After years of double-digit growth rates, the global ring tone mkt appears to have come to the end of its crescendo, according to a variety of measures. In some parts of the world, ring tone sales are actually declining, and the former ring tone kings, like Jamba of Germany and Musiwave of France, are refocusing their businesses on other ways to personalize cellphones… FT: Up to $1 bln is set to flow into North African and Middle Eastern stock mkts in the coming months as several heavyweight cos launch funds focusing on the region, confirming its status as the next investing hot spot… India’s stock mkt regulator has issued draft rules that will pave the way for the introduction of real estate investment trusts to serve the country’s booming property mkt. The move will help prevent the lucrative Reit business going offshore to neighboring Singapore or Dubai as Indian real estate groups seek ways to raise new capital to fuel ambitious development plans… DigiTimes: AMD’s RS780 and NVDA’s MCP 78 IGP chipsets are scheduled to go head-to-head in the first quarter of 2008, however, performance of the MCP 78S is reportedly below that of the RS780, while the higher-end MCP 78U is causing issues due to its higher thermal dissipation giving AMD the advantage over the chipset battle, according to sources at motherboard makers.
09:13 SCANX Gapping down

General news: TIN -39.9% (completes its FOR spin-off), COGT -11.9% (mentioned negatively in Barron’s), PZE -9.8% (pulling back following Friday’s late day surge — see archives for comments), SLXP -5.7% (confirms launch of COLAZAL authorized generic with Watson; downgraded to Sell at Piper Jaffray, also tgt lowered to $8.50 from $14 at Soleil), ADPI -4.8% (showing slight weakness after last week’s 70% surge), MGIC -2.0% (announces sale of Advanced Answers on Demand to Fortissimo Capital for the sum of $17 mln in cash), HITK -1.5% (acquires Midlothian Laboratories for $5 mln in cash), BIDU -1.2% (announces CFO passed away).
09:12 COMDX Morning Commodities Summary

Energy Watch: Crude futures have been helped higher overnight by word Iran plans to start its first nuclear reactor next year. Also lifting crude is a tropical cyclone in Australia that has hurt oil production in the region. There has also been some chatter that ConocoPhillips (COP) is having problems at its Wilmington refinery again. Feb crude oil is up 71 cents to $96.71pbl. Today is the expiration of Jan Heating oil/RBOB gas. Feb heat cracks are up 78 cents to $15.190 and Feb gas cracks are up 37 cents to $8.455. Feb natural gas is off 3.6 cents to $7.350mbtu… Metals Watch: Gold is up over 30% ytd and is not far from its 28-yr high of $873. This morning in light trading, Feb gold is off $1.70 to $841.00 (range is $836.10 to $847.40). Traders are watching this morning’s housing data for direction in copper prices (copper has been under pressure due to concerns the weak housing mkt will remain a factor in 2008; also has been weak on speculation of a slowdown in the U.S. economy). Mar copper is off 1.6 cents to $3.0560.
09:08 MLNM Millennium Pharm: Raising Velcade sale ests on strong IMS trends - Cowen (15.10 ) -Update-

Cowen says that based on the positive IMS sales trends for the quarter, they are raising their 2007 and 2008 Velcade sales ests slightly, although they believe more upside exists. Firm is increasing their 4Q Velcade sales est slightly from $74 mln to $76 mln. Firm is increasing their 2008 U.S. Velcade sales from $330 mln to $335 mln.
09:05 CBST Cubist Pharma: Q4 Cubicin sales tracking in-line - Cowen (21.32 )

Cowen notes they are leaving 4Q07 Cubicin sales estimate of $81.9M unchanged based on the most recent IMS sales update. Although firm expects CBST to report top line U.S. Cubicin sales next week, they believe a more meaningful event for investors will be 2008 sales guidance, expected later this month at the time of CBST’s 4Q results.
09:01 SFSF SuccessFactors initiated with an Outperform at Pac Crest- tgt $18 (11.21 )

09:01 LLNW Limelight Networks announces that Level 3 Communications has filed a lawsuit against the company (7.32 )

Co announces that Level 3 Communications (LVLT) has filed a lawsuit against LLNW in which it is alleged that LLNW infringes certain of LVLT patents. LLNW is aware of the allegations made against it, believes that these allegations are without merit, and intends to defend itself vigorously.
09:00 OXGN OXiGENE reports positive preclinical ocular penetration data with topical formulation of ZYBRESTAT for ophthalmology and positive results in phase 2 study of ZYBRESTAT in platinum-resistant ovarian cancer (2.18 )

Co reported positive results from preclinical studies with topical formulations of ZYBRESTAT for ophthalmological indications. The studies, performed in industry-standard rabbit models, indicate that two formulations of ZYBRESTAT, when applied topically to the surface of the eye, are absorbed and result in concentrations of drug in target tissues in the back of the eye that the co believes will be sufficient for therapeutic activity in age-related macular degeneration and potentially other eye diseases in which abnormal neovascularization plays a role. These results confirm preliminary results seen in earlier preclinical studies. Also the co announced that its lead product candidate, ZYBRESTAT, has achieved the pre-specified primary efficacy endpoint for Stage 1 of an ongoing Phase 2 ovarian cancer clinical trial. The clinical trial utilizes an open-label, Simon two-stage design to evaluate the combination of ZYBRESTAT, carboplatin and paclitaxel in patients with advanced, platinum-resistant ovarian cancer, a refractory form of ovarian cancer for which therapeutic options are limited. Having met the Stage 1 primary efficacy endpoint, the clinical trial will proceed to its second stage, in which an additional 25 patients will be enrolled.
09:00 VG Vonage and Nortel confirm they agree to settle patent dispute (2.00 ) -Update-

The co and Nortel (NT) announce that they have agreed in principle to end the litigation pending between them. The contemplated settlement involves a limited cross license to three Nortel and three Vonage patents and will not call for any monetary payments by any party. Claims relating to past damages and the remaining patents will be dismissed without prejudice. The settlement is subject to final documentation. “We are pleased to resolve this issue and enter into a productive relationship with Nortel,” said Vonage Chief Legal Officer Sharon O’Leary.
08:59 DRAM makers positive over ongoing price trends amid long-awaited spot market rebound - DigiTimes

DigiTimes reports DRAM prices are showing signs of warming with pricing of mainstream 512Mb DDR2 effectively test chips again topping $0.90 levels. DRAM makers are generally positive about the price rebound hoping that it foreshadows a relatively healthy pricing environment in 2008. Spot pricing of 512Mb DDR2 eTT chips dropped to as low as $0.75 on Dec 11 but prices started to trend upward again and hit $0.90 on Dec 26, according to figures posted by DRAMeXchange. Prices closed at $0.89 on Dec 31, the co reported.
08:58 NINE Ninetowns misses by $0.01, beats on revs (3.39 )

Reports Q2 (Jun) loss of $0.05 per share, $0.01 worse than the First Call consensus of ($0.04); revenues rose 11.3% year/year to $3.1 mln vs the $3.1 mln consensus.
08:58 S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: -4.5.
08:57 NINE prelim ($0.05) vs ($0.04) First Call consensus; revs $3.1 mln vs $3.10 mln First Call consensus

08:56 AUO AU Optronics to detail next-generation plans on January 30 - DigiTimes (19.21 )

DigiTimes reports the co will announce details of its next-generation project at its January 30 investors conference, with the panel maker remaining optimistic about the first quarter of 2008, according to a co executive. AUO will also provide a detailed outlook for the first quarter during the conference, but the panel maker expects that demand will stay strong during the traditionally low season and utilization will continue to be almost full, said Chan Li-chu (transliterated from Chinese), a manager from the co’s finance department. She said AUO’s business for the fourth quarter of 2007 is expected to meet the company’s previous forecast.
08:55 SCANX Gapping up

In reaction to strong earnings/guidance: JADE +81.6%, ASHW +2.3%… M&A news: TMY +85.7% (to be acquired by T.M.I. for $3/share)… Other news: DPTR +18.6% (announces strategic investment by Tracinda), VG +7.5% (will not have to pay Nortel to settle patent spat - DJ; to pay AT&T to settle patent dispute - Reuters), CHINA +4.0% (still checking), BBGI +4.0% (Gabelli Funds raises stake to 16.67% from 14.97%), AVNX +2.9% (recommend buying during overreaction - BWS Financial), ASTI +2.8% (extends gains after Friday’s 25% surge), ASHW +2.3% (shares a compelling value, maintain Buy at B. Riley), MYL +1.4% (confirms announcement of final FDA approval for new drug application of Balsalazide Disodium Capsules), UA +1.1% (Credit Suisse makes positive comments), PBR +1.0% (near Friday’s close, Ken Heebner on CNBC refers to new discovery that was announced by PBR earlier this year).
08:55 JCOM j2 Global: Still growth potential despite industry challenges - Broadpoint Securities (21.83 )

Broadpoint Securities says that they although they believe JCOM is attractive at current levels, many investors are concerned that FY08 guidance could be reset lower due to ongoing challenges in the credit sensitive markets (20%-25% of j2’s business). If expectations are reset following the 4Q07 conf call, firm would consider owning the shares for three primary reasons: 1) j2 still has several attractive growth opportunities including voice services, international expansion and attractive acquisition conditions; 2) has numerous assets; 3) firm believes it is one of the more attractively valued stocks in the SaaS universe
08:54 WRAPX Pre-market Summary

Following Friday’s nearly unchanged session, futures indicate another flat start for the mkt. Credit this morning’s lack of conviction to a lack of mkt-moving news and the holiday mentality. Although the stock mkt is open for a full day of trading today, plenty of participants will be elsewhere. Accordingly, look for volume to be on the light side again. There is one noteworthy economic release on the docket. Following Friday’s very disappointing Nov New Home Sales report (647K vs. the 715K consensus), the Existing Home Sales report for Nov will hit the wires at 10:00ET. Economists expect an annualized rate of 5.00 mln, which is up slightly from the 4.97 mln rate reported for Oct. Dow futures are currently +11; Nasdaq futures are currently -2.5; S&P futures are currently +1.7. For technical levels of interest, click here… Following Friday’s large gains, the Bond mkt is wandering higher (and 10-yr yields are once again approaching 4.00%) amid thin volume in anticipation of further bad housing data later this morning. The 10-yr is currently +13/32 to 4.023%. Note the Bond mkt closes early today, at 13:00ET… In Europe, mkts inched lower in early trade, with volumes expected to remain thin in a shortened session ahead of the New Year’s Day holiday and with the German stock mkt closed. FTSE is currently -0.3%; CAC is currently -0.2%. In Asia, what few mkts were open rose amid speculation the U.S. Federal Reserve will cut rates next year to boost growth in the world’s largest economy following weak housing data there. Japan’s Nikkei and mainland China’s Shanghai Composite were closed. Hang Seng closed +1.6%… Notable pre-market Calls include Downgrades: SLXP at Piper Jaffray… On the Earnings calendar, no cos are confirmed to report today after the close… On the Economic calendar, as mentioned above Nov Existing Home Sales (consensus 5.00 mln) will be released at 10:00ET.
08:54 VG Vonage and Nortel reach tentative settlement, will dismiss claims to past damages, says spokesman- Bloomberg (2.00 )

Nortel (NT) and Vonage will not ask for monetary damage
08:52 GBE Grubb & Ellis: Micheal Kojaian discloses 16.4% stake in SC 13D/A (6.26 )

Previous filing on 9/19 disclosed a 40.4% stake
08:51 Alternative Energy: AmTech believes now is a good entry point in shares of FSLR, JASO, SPWR, and STP

AmTech notes there is always a lot of volatility around earnings season in high growth names. Due to the positive near-term demand picture in solar, earnings season has been an exercise in gauging sentiment and whisper numbers rather than fundamentals. Firm believes that certain solar cos are better positioned than others and that each co in their sample has many issues to consider that are unique to it, particularly around earnings season. For longer term investors, they are believers in the solar secular growth story and expect rev and earnings will continue to trend higher at better positioned cos. Firm believes now is a good entry point in shares of FSLR, JASO, SPWR, and STP ahead of a possible earnings season build in expectations.
08:50 FRX Forest Labs: Announces the submission of an NDA for milnacipran for the treatment of fibromyalgia syndrome - AmTech (37.16 )

AmTech notes the submission is based on data from two pivotal Phase III trials. While a PDUFA data has not been released they believe it could be in the 2H08 or potentially 1H09 if the agency waits to review results from a third ongoing Phase III trial. Regardless of the exact quarter that the drug is potentially approved in, they believe it has the fundamentals to be a significant, and equally as important, long-lived, asset for the company.
08:44 Additional detail on 7:27 story about the Taiwan Stock Exchange selling a stake to an investor

FT reports the Taiwan Stock Exchange is planning to sell up to 25% of its equity to strategic investors, including an investment bank and other exchanges, during or after an initial public offering in 2009. The disclosure, in an interview with the Financial Times, highlights the priority being given by Wu Rong-i, the TSE chairman, to engineering cross-border tie-ups with other exchanges. The Taiwan govt said this year that the bourse would merge with two smaller local exchanges and a clearing institution before the IPO, in line with the global trend for consolidation among stock and futures mkts. Mr Wu said that the CME, the leading US futures exchange, had shown an interest in taking a stake, following earlier discussions with the NYX, Deutsche Borse and NDAQ.
08:41 MHO M/I Homes announces land sales and exit from West Palm Beach market (10.10 )

Co announces that it has sold land to various buyers for $82 mln. In connection with this sale, the co also announced that it is exiting the West Palm Beach market. Due to these land sales, the co will record pre-tax land impairment charges of approx $80 mln in 2007’s fourth qtr, and expects to receive an approximate $50 mln cash tax refund in 2Q08. Additionally, in connection with the co’s quarterly inventory review for q$, it is likely that further impairment charges will be recorded.
08:33 CACH Cache tgt cut to $15 at Brean Murray (9.92 )

Brean Murray cuts their tgt on CACH to $15 from $22 after Cache pre-released that it will not achieve its original Holiday quarter guidance. While they believe mgmt can point to a number of key positives in the Holiday season, they were not enough to offset a very weak women’s market. As such, they are taking a more conservative stance on their 4Q07 ests and tgt; that said, firm is leaving the rest of their projections untouched, as they believe they already assume a relatively limited turnaround, which they believe is still achievable.
08:32 IDMI IDM Pharma announces termination of Uvidem development collaboration and expected restructuring in connection with evaluation of strategic alternatives (0.94 )

Co announced that as part of the co’s recent decision to evaluate strategic alternatives, the co initiated discussions with sanofi-aventis (SNY). Following this, sanofi-aventis has notified the co of its decision to discontinue participation in the development of UVIDEM, its investigational therapy being studied for the treatment of melanoma, with all rights to the product reverting to the co. In connection with this decision, the co announced it expects to restructure, which it anticipates will involve staff reductions in the co’s workforce and a review of the assets and costs associated with products under development. The co’s restructuring plan is expected to be finalized and approved by the its Board of Directors during the first quarter of 2008. The co expects to retain a core team in key functional areas and, as part of the co’s previously announced strategic initiatives, will continue to evaluate the UVIDEM clinical program, which recently completed Phase 2 studies with promising results.
08:32 ASB Ascendia Brands announces agreement on recapitalization and debt re-structuring (0.21 )

08:31 RDEA Ardea Biosciences’ lead NNRTI for HIV, RDEA806, to enter phase 2a proof-of-concept clinical trial (14.79 )

Co announces that the Medicines and Healthcare products Regulatory Agency in the United Kingdom has authorized a Phase 2a clinical trial evaluating RDEA806, a novel non-nucleoside reverse transcriptase inhibitor, in patients with human immunodeficiency virus, the causative agent of AIDS.
08:31 California water utitlities upgraded at Brean Murray

Brean Murray upgrades two of the California water utilities, firm upgrades SJW Corp (SJW) and California Water Service Group (CWT) to Buy from Hold based on three reasons. The firm continues to remain concerned about ongoing drought conditions in the Western United States (and in the State of California, in particular) recent forecasts from the National Oceanographic and Atmospheric Administration indicate weather patterns are expected to show some improvement in 1Q08, which could provide upside to their 2008 estimates. Firm says the shares of both stocks have pulled back substantially in recent days, and they expect the dividend yields of both shares will limit downside exposure, and could provide a modest catalyst if general interest rates continue to fall.
08:31 CTV Commscope: Ests raised on ANDW acquisition and brighter forecasts - Brean Murray (49.45 )

Brean Murray notes that with the Dec 27 consummation of CTV’s acquisition of Andrew Corporation, they are updating their model to reflect the combined operations for 2008 and beyond. In addition, our new model takes into account ANDW’s stronger-than-expected 4Q07, CTV’s recent increase in guidance for 2007 and AT&T’s recent announcement of its intent to expand its LightSpeed program into the former BellSouth territories. The net effect of these events leads firm to increase their 2008 EPS est to $3.39 from $3.02. Further, they have raised their 2007 EPS est to $2.95 from $2.94.
08:30 TMY Transmeridian Exploration announces definitive agreement for sale of company for a price of $3/share (1.40 )

Co announces that it has entered into a definitive merger agreement pursuant to which T.M.I., through a wholly owned subsidiary, will commence a tender offer to purchase all of the co’s outstanding shares of common stock for a price of $3.00/share, payable net to the seller in cash. The purpose of the tender offer is to acquire for cash as many outstanding shares as possible of the co’s common stock as a first step in a “going private” transaction resulting in T.M.I. acquiring the entire equity interest in the co. The merger agreement permits the co to solicit competing offers for the acquisition of the co until the financing condition to T.M.I.’s obligation to commence the tender offer is satisfied.
08:30 S&P futures vs fair value: -0.6. Nasdaq futures vs fair value: -4.0.

Futures indicate a slightly lower open. The S&P 500 appears to be poised to end the year with a modest gain. The Index is up 4.2% year-to-date.
08:27 S Sprint Nextel’s new CEO could consider alternatives for long distance, spectrum and wireless, sources say - FT Mergermarket (13.16 )

FT Mergermarket reports the co will likely lay low for several months as new CEO Dan Hesse evaluates operational issues, said three bankers. After that, Hesse, who served as CEO of Sprint’s rural telecom spinout Embarq for the past year, will consider alternatives for long distance, spectrum and wireless, the bankers speculated. A spokesperson for Sprint commented, “Dan Hesse told senior executives at the company yesterday that he’s coming onboard with no preconceived notions about anything. He’s going to review all of the elements of our business and come to the table with a plan to improve customer service, and reposition the company for growth.”
08:27 BONDX Bond Watch: Thinly Higher

The market is wandering higher, catching a tailwind from last week’s bad data & ahead of anticipated bad data. Global trade was thin with most markets closed ahead of the New Year’s holiday, leaving trade highly susceptible to chase whims. The 2-10-yr yield spread continues to flutter around 96.3 as curve trade awaits deeper markets & better direction. Bond prices in the EuroZone were modestly higher while in Japan, markets were closed. Treasuries will have nothing to work with until the home sale data mid-morning & look prepared to lean higher on air. Technically, last week’s positive momentum is carrying prices higher but that may wane as resistance (support equating to about a 4.050% 10-yr yield) & short-term overboughtness are trying to prevent things from getting too carried away before the numbers hit. The dollar has been able to fight off a euro bid above 1.4750 but it remains weak while the yen has been snaking its way higher after last week’s stronger Japan inflation data. Spot gold softened to 837.51 (-2.99) while crude oil is down at 95.72 (-0.2 despite Iran declaring a plan to open a nuclear reactor in 08. Existing home sales are at 10. The euro is at 1.4731 & the yen is at 111.8400 while the 10-yr is +08/32 yielding 4.042%. Financial futures & options close early (13). For more bond & economic commentary click here.
08:26 China’s CIC likely to diversify away from further US banking sector investments, source says - FT Mergermarket

FT Mergermarket reports US investors who view the recent flurry of strategic purchases by the Chinese govt of stakes in US investment banks as ‘smart money’ may be in for a disappointment, a source familiar with the Chinese govt’s thinking told mergermarket. The source, who has direct access to the Chinese govt officials who decide on what assets sovereign wealth funds such as China Investment will acquire, says that until now CIC has lacked a clear strategy and will in future focus its investments in the natural resources sector. The sources’ insights indicate not only that outside investors lack the investment acumen to have spotted a bottom in the credit crunch but also that, in the case of China’s CIC, further investments in the US financial sector will be limited. Warren Buffet’s reluctance to make any moves into the US financial sector, as stated earlier this week, similarly indicate that the credit crunch has a ways to go before investors will be able to call a bottom.
08:24 LLY Lilly’s Zypreza, Pfizer’s Geodon could see reimbursement restrictions next year - FT Mergermarket (54.05 )

FT Mergermarket reports psychiatric drugs like Eli Lilly’s Zyprexa could be next on the list for reimbursement restrictions based on comparative effectiveness data, experts in the field told Pharmawire. The move would also spell trouble for AstraZeneca’s Seroquel (AZN) and Pfizer’s (PFE) Geodon, two commonly prescribed and costly antipsychotics. Cost pressures will be felt most acutely starting in June, when the patent expires on Johnson & Johnson’s (JNJ) competing product Risperdal. Public and private payers have been fueling the growing interest in compiling data that allows them to compare different drugs within the same therapeutic category. The information then helps shape reimbursement programs - like step therapy, where patients are required to try a cheaper drug before a more expensive one will be covered.
08:22 MATR Matria Healthcare a target in an attractive industry; seen strategic interest - FT Mergermarket (23.12 )

FT Mergermarket reports the co, could make an attractive takeover target and has seen strategic interest, industry bankers told dealReporter. Matria provides wellness and disease management programs to employers, private and govt sponsored health plans, pharmaceutical cos and individuals. A first industry banker said that with a stable business platform and strong customer base, Matria could attract interest from potential suitors. Other than its specialty services, Matria has an extensive database of employee customers including their health, drug and treatment history going back years, which could be of interest to retailers as they use it to offer cost efficient treatment methods to a huge pool of existing clients, added the banker. A fair price in the event of the sale would be about a 35 — 40% premium to its current trading price, as the stock has recently been depressed, the banker said.

08:17 BA Boeing: Australia may cancel Boeing contract, report says - Seattle Times (88.25 )

Seattle Times reports Australia will review its air-combat spending program, which includes a $5.8 bln deal for 24 F/A-18 Super Hornet fighter bombers from Boeing, the Sydney Morning Herald reported. The review is being will start “as soon as practicably possible,” a spokesperson for Defense Minister Joel Fitzgibbon said in an e-mail. The govt may cancel the Boeing deal or try to renegotiate it, the Herald said.
08:16 IMNY I-many announces it has entered into a definitive agreement with institutional investors for the private placement of $17 mln of convertible notes (3.34 )

08:14 SCANX Early pre-market gappers

Gapping up: JADE +72.9%, DPTR +20.6%, VG +10.0%, ASMI +8.7%, BBGI +4.0%, ASTI +3.2%, ASHW +2.3%, UA +1.1%, PBR +1.0%… Gapping down: TIN -39.9%, COGT -14.0%, SLXP -10.7%, PZE -9.8%, CBI -3.7%, ARD -2.9%, TRA -2.3%, MGIC -2.0%, HITK -1.5%, BIDU -1.5%.
08:13 SLXP Salix Pharm tgt cut to $13.50 at Roth (9.01 ) -Update-

Roth cuts their tgt on SLXP to $13.50 from $17 following the FDA approving 3 ANDAs (Apotex, Mylan, Roxane) referencing the co’s flagship drug Colazal on Friday, sending shares tumbling more than 20% in afternoon trading. Although the FDA has not yet made public its justification for its apparent rejection of the arguments offered in SLXP’s related Citizen’s Petition, the agency’s increasing belligerency towards drug innovators suggests that they drew every inference necessary to expedite approval in the ANDA applicant’s favor. Revising ests: Revenues for FY08-09 now $234-$334 mln vs. $316-$377 mln previously. EPS now $0.25-$0.85 vs. $0.90-$1.19 previously.
08:11 RDS.A Royal Dutch Shell looks to outsource about 3,200 IT jobs - FT (84.85 )

FT reports the co is expected to outsource the bulk of its information technology division next year, a move that could affect about 3,200 jobs. The oil group aims to make pre-tax cost savings of about $500m-a-year through streamlining its structure and cutting and outsourcing jobs. As part of this cost-cutting drive, Shell has been examining whether to outsource most of its IT division, which numbers about 3,600 people. According to Shell protest website royaldutchshellplc.com, an e-mail from Goh Swee Chen, vice-president of IT infrastructure, was leaked by a Shell employee on December 19 and outlined details of the outsourcing deal.
08:09 AVNX Avanex: Recommend buying during overreaction - BWS Financial (1.04 )

BWS Financial notes AVNX reduced their rev guidance for fiscal second and third quarters after 3S Photonics terminated their distribution agreement with the Company earlier than expected. The departure of 3SP was inevitable and better to happen now to allow AVNX to focus on its core business. The result of no more submarine revs means that AVNX would have a lower rev base for fiscal 2008, but it also means that profit margins improve. Firm believes that once the news broke investors quickly referred to the 10-K and 10-Q for information regarding the 3SP deal. In these filings there is the mention of Alcatel Lucent (ALU), AVNX’s largest customer, being one of customers for the segment.
08:07 Corporate bond yields may fall as companies refinance - Bloomberg

Bloomberg reports borrowing costs for Citigroup, AT&T and hundreds of U.S. investment-grade corporate bond issuers may fall next year as they refinance about $557 bln of bonds, according to data compiled by Bank of America. Yields on $2.2 trillion of debt in Merrill Lynch’s benchmark U.S. Corporate Master index dropped to 5.96 percent from this year’s high of 6.19 percent on June 12. While losses from subprime mortgages roiled credit mkts, the rally in Treasuries more than made up for the widest risk premiums on corporate debt in five years.
08:05 BONDX Economic Calendar

Existing home sales at 10.
08:05 UNCA Unica reports EPS in-line, beats on revs; announces restatement of previous quarters (9.30 )

Reports Q4 (Sep) earnings of $0.11 per share, excluding non-recurring items, in-line with the First Call consensus of $0.11; revenues rose 20.6% year/year to $29.3 mln vs the $29 mln consensus. Co announces it will restate its previously issued unaudited condensed consolidated financial information for each of the first three fiscal quarters of Y07 due to errors in recording the state income tax provision, and also errors in recording its state sales tax liabilities and receivables, the timing of recording revenue on certain revenue arrangements, and the timing of recording a purchase accounting entry.
08:02 ABMD Abiomed announces an update on its European strategy to drive growth by establishing recovery as the goal for patients experiencing acute cardiac events (15.50 )

Co announces an update on its European strategy to drive growth by establishing recovery as the goal for patients experiencing acute cardiac events. There are over 200,000 deaths annually in Germany, France, UK, Spain, Italy and Russia from acute myocardial infarction. The co’s portfolio of circulatory care products including Impella, iPulse and AB5000 are approved in 27 European Union countries through CE-Mark approval, and Impella is now approved in over 40 countries outside the United States. The co announced that it has continued to invest in its sales, clinical, marketing and field service teams in Europe, now totaling over 30 individuals, to promote recovery for acute heart failure patients and increase revenue growth. Revenue in Europe for the first two quarters of Abiomed’s fiscal year 2008 represented the highest six months revenue total for the region in Abiomed’s history. The Impella technology has been the subject of more than 40 publications.
08:01 UNCA prelim $0.11 vs $0.11 First Call consensus; revs $29.3 mln vs $28.96 mln First Call consensus

08:01 ME Mariner Energy: Agrees to acquires additional W. Texas and GOM shelf assets - Calyon (22.48 )

Calyon notes ME has agreed to acquire StatoilHydro’s entire GOM shelf position for ~2.25/Mcfe of proved reserves and (separately) additional acreage in the West Texas Spraberry field for $1.28/Mcfe. The acquisitions add ~20% (combined) to ME’s current production and proven reserves, and will be funded via existing credit lines. The deals are nearly 15% accretive to firm’s 2008 EPS/CFPS estimates and 4% accretive to their assessment of NAV.
07:59 S&P futures vs fair value: +0.1. Nasdaq futures vs fair value: -3.0.

Futures suggest a flat to slightly lower open on the last trading day of 2007. Volume should be light today, as many traders will be taking the day off. The November existing home sales report will be released at 10:00 ET. Economists expect a reading of 5.00 million.
07:59 MLNM Millennium Pharm: Receives $40 mln milestone payment for ex-U.S. Velcade sales - Baird (15.10 ) -Update-

Baird reiterates their Outperform rating and $18 tgt as they remain positive on MLNM shares following the press release on achievement of a $40M milestone for ex-US Velcade sales. Firm sees this as evidence of accelerating commercial development in Europe, which they believe similarly bodes well for US Velcade potential. Firm continues to believe Velcade may be on the cusp of a bona fide commercial proliferation; and as such, remain buyers here.
07:45 SAN Banco Santander stalls in talks for UK lender - FT (50.71 )

FT reports the co was in talks this month to buy another UK mortgage lender but negotiations stumbled on price and came to nothing, according to people close to the bank. The Spanish lender is also understood to have turned down the assets of Northern Rock, the UK bank that ran into trouble with the credit crunch. The talks were part of Santander’s desire to complete its global footprint that has led it to examine the current turmoil in the financial mkts for buying opportunities. “We are very close to our ideal size now,” Emilio Botin, Santander chairman, told the Financial Times.
07:45 MFE McAfee tgt raised to $43 from $40 at Jefferies (37.47 )

Jefferies tgt raised to $43 from $40 saying the completion of the restatement removes a distraction for management and clears the way for McAfee to start buying back stock. They continue to believe that execution in the core business and accretion from the SafeBoot acquisition will drive the stock during 2008.
07:41 LM Legg Mason: Jefferies comments on Friday’s SIV announcement (71.23 )

Jefferies notes that on Friday LM announced its intention to provide capital support for two non-U.S. SIV holdings in its liquidity portfolio. They say LM has approx. $3.4 bln of remaining non-bank SIV exposure, leaving the possibility of further charges if the ABCP market does not improve. They say that while LM is attractively valued at 13.1x their 2008 est, they believe the current challenges in its domestic mutual funds and exposure to SIVs will limit near term share appreciation. Firm cuts their tgt to $78 from $79.
07:40 UA Under Armour: New sneaker and combining style, functionality, and highperformance technology reflect the authentic performance nature UA brand - Credit Suisse (42.46 )

Credit Suisse notes the combining style, functionality, and highperformance technology, both the campaign and sneaker reflect the authentic performance nature of the Under Armour brand. In contrast to the one-design-fits-all approach that has become standard in the industry, the UA performance trainer will offer three styles of its Prototype shoe: the Speed, Power, and Evade - each corresponding to the unique athletic movements required and desired by the individual. One of the benefits of launching the campaign this early is that it will build excitement for consumers and retailers alike. Assuming UA can achieve a 10% share of the U.S. athletic footwear market (this compares to its current 25% share of the cleat market), they est that footwear could eventually contribute $1+ bln of revs (vs. $600 mln this year) and $2.00+ of EPS (vs. $1.03 currently).
07:32 Citigroup sees ‘double-digit’ gain in European stocks - Bloomberg.com

Bloomberg.com reports that Citigroup sees ‘double-digit’ gain in European stocks as central banks cut interest rates to boost economic growth. The firm believes European equities should be supported by lower rates, macro resilience, earnings growth, reasonable valuations and liquidity and expects the U.K.’s FTSE 100 Index to reach 7,000 by the end of 2008. The firm thinks European stocks, measured by price relative to earnings, are cheaper than U.S. and Asian equities. World economic growth is likely to decline to 3.4% in 2008 from 3.7% this year, with the U.S. economy showing ‘resilience’ rather than falling into recession, assuming the Federal Reserve cuts interest rates, according to Citigroup.
07:31 U.S. stock index futures signal a mixed to slightly higher open on final trading session of ‘07, traders eye existing home sales

Currently, Mar. S&P 500 futures (ES) @ 1487.50 +2.00, S&P MidCap (MC) @ 869.90 +1.50, Nasdaq 100 (NQ) @ 2125.00 +/-0.00, Russell 2000 (AB/ER2) @ 774.70 +1.40, Dow (YM) @ 13442 +15.
07:31 MYL Mylan Labs confirms announcement of final FDA approval for new drug application of Balsalazide Disodium Capsules (14.05 )

07:27 CXM Cardium Therapeutics: 2008 preview, could see some trial results - Oppenheimer (2.45 )

Oppenheimer notes that in 2007 CXM began its Phase III trial for its Generx product and its Phase II trial for its Excellerate product. While we believe all of Cardium’s products meet medical needs, we are extremely enthusiastic about the Excellerate product. If data from the Phase II trial comes back positive, we believe there is a small possibility that the FDA will not require another trial.
07:27 CME Taiwan Stock Exchange in talks with CME Group on stake sale - WSJ (682.50 )

The Wall Street Journal reports Taiwan Stock Exchange is in preliminary talks to sell a minority stake to CME Group (CME), the exchange’s executive vice president, Michael Lin, said Monday. Taiwan Stock Exchange Chairman Wu Rong-I said Monday the size of the stake slated for sale to foreign strategic investors may exceed 25% if Taiwan’s financial regulator gives its approval. The exchange plans to sell stakes to foreign investors after a pending merger with Taiwan Futures Exchange, GreTai Securities Market and Taiwan Depository & Clearing Corp.
07:27 November chip sales up 2.3% year-on-year

Worldwide sales of semiconductors rose to $23.1 bln in Nov, an increase of 2.3% from Nov 2006 when sales were $22.5 bln, the Semiconductor Industry Association reports. Sales increased by 0.7% from the Oct sales of $22.9 bln. Year-to-date sales of $231 bln are 2.8% ahead of the $225 bln in sales for the like period of 2006. “Early indications are that consumer products with high semiconductor content such as LCD TVs, PMP and MP3 players, along with digital cameras all sold well in the holiday buying season,” said SIA President George Scalise. “These products are all finishing the year with very healthy unit sales increases. Cell phone unit sales in 2007 will grow by over 20% for the fifth-consecutive year, while unit sales of personal computers will grow by more than 10%.”
07:25 STLD Steel Dynamics: Reducing 4Q EPS est, raising 2008 and new 2009 est - Soleil (60.46 )

Soleil notes that based on new information from Steel Dynamics, we are reducing our 4Q07 earnings estimate to reflect longer-than-expected outages at two mills and costs associated with the acquisition of Omnisource, which had not been included in our previous estimate. Excluding these two items, they believe that their earning est, which was above the co’s guidance, would have been on tgt. Co is reducing their 4Q EPS est by $0.14 (to $0.95 from $1.09). The co’s original guidance was $1.02 to $1.07. Firm is increasing their 2008 EPS est to $5.20 from $5.05.
07:25 BABY Natus Medical: Believe the co will see strong revenue and earnings growth in 2008- Oppenheimer (18.81 )

Oppenheimer expects Natus Medical will complete a strong 2007 with revenue of $117.8 mln representing a 31% increase and EPS of $0.51 representing a 45% increase. During the year, Natus saw rapid international hearing screening growth and completed the acquisition of XLTEK. They believe Natus will see strong revenue and earnings growth in 2008, will receive its supplemental Cool-Cap approval, and possibly complete additional acquisitions. Firm reits Buy and $22 tgt.
07:21 Pakistan markets fall on Bhutto killing - Bloomberg

Bloomberg reports Pakistan’s stocks slid the most in more than 1 1/2 years on the first day of trading following the assassination of former Prime Minister Benazir Bhutto last week. Oil & Gas Development, the nation’s biggest fuel explorer, and MCB Bank, the country’s largest lender by mkt value, both fell by their daily limits. The rupee dropped to its lowest since 2001. The Karachi Stock Exchange 100 Index fell 694.92 points, or 4.7%, to close at 14,077.16 at 2:15 p.m.
07:21 European mkts dip ahead of New Year’s holiday

European mkts inched lower in early trade, with volumes expected to remain thin in a shortened session ahead of the New Year’s Day holiday and with German, Italian and other European stock mkts closed. Recently hammered banking stocks edged higher, with HBOS up 1.2%, Commerzbank up 0.5% and Bank of Ireland (ADR: IRE) up 0.7%. HSBC (ADR: HBC) was down 0.3%. The Daily Mail said on Monday HSBC faces renewed pressure to overhaul its strategy after Calpers, the largest U.S. pension fund, told the bank to address its share-price underperformance, refocus the group and set testing new financial targets by July 1. The UK’s FTSE 100 index was down 0.3% and France’s CAC 40 was down 0.2%. (Reuters)
07:21 Asian mkts mixed on final trading day of 2007; Sensex gains 80 points

Asian mkts ended mixed on the final trading day of the year, with Australia flat as traders locked in gains on resource stocks while Hong Kong squeezed out gains as fund managers chased bargains after two days of losses. Overall, activity was subdued with Japan, China, South Korea, Indonesia, Thailand and the Philippines closed. The Hang Seng closed up 1.6%, while Singapore’s Straits Times closed +1.1%… In India, 2007 ended on an optimistic note with the Bombay Stock Exchange benchmark Sensex closing 80 points higher on good buying support from investors following a firm trend in other Asian mkts. Foreign Institutional Investors were believed to be heavy buyers in a bid to push the net asset value of their portfolios at the end of their financial year. The index touched an intraday high of 20,484.28 points at the outset, but later trimmed gains as retail investors booked profits during afternoon trade. Refinery shares were in the forefront and closed with gains on expectations of petrol price hike in the near future. State-run refining and marketing cos HPCL, Indian Oil and BPCL registered hefty gains. IT stocks, however, suffered a moderate setback due to fresh selling pressure. (Thomson, Hindustan Times)
07:17 BEAV BE Aerospace profiled in New America section of IBD (52.88 )

IBD reports is the world’s leading manufacturer of aircraft cabin interior products and aircraft components. The co sells seats, lighting systems and storage equipment. It also markets food and beverage preparation equipment and oxygen systems. The co expects double-digit growth in both its top and bottom lines in 2008. Analysts are expecting $1.49 a share in 2007, a 49% increase from 2006, and $2.32 in 2008. “Very few companies in the commercial aerospace supply chain are posting double-digit top line growth with margin expansion as well,” said Patrick McCarthy, an analyst for Friedman Billings Ramsey. So what is driving growth? The co benefits from rising mkt share, driven by new contract wins, an expanding product line and acquisitions. It also is seeing a substantially higher level of aftermarket, retrofit activity. These trends have left the co in an enviable spot. Boeing’s new Dreamliner 787 wide-body aircraft is important for B/E Aerospace. It expects the first 1,000 Dreamliners delivered to generate $1.5 bln in sales.
07:09 CYPB Forest Labs and Cypress Bioscience announce submission of NDA for milnacipran for treatment of fibromyalgia syndrome (11.15 )

The submission includes efficacy data from two Phase III trials involving 2,084 patients (1,460 milnacipran, 624 placebo), which showed that milnacipran demonstrated improvement compared to placebo in treating FMS.
07:03 ENDP Endo Pharm: Acquires inhaled fentanyl from Alexza - Broadpoint Capital (26.73 )

Broadpoint Capital notes ENDP recently announced that mgmt had entered into an agreement with Alexza Pharmaceuticals (ALXA-$8.25) for an inhaled formulation of fentanyl. The announcement comes as somewhat of a surprise, as Endo had recently announced positive interim results from its own rapid onset opioid program in a Phase III trial. Although mgmt has not yet been able to comment, firm also notes that there are other inhaled formulations of fentanyl in a more advanced stage of development. Specifically, Akela Pharma has already partnered its drug with the European division of Johnson & Johnson (JNJ) and is expected to advance its formulation into Phase III trials in early 2008.
07:03 SLXP Salix Pharm: Estimates reduced to reflect generic competition for Colazal; tgt cut to $8.50 - FBR (9.01 ) -Update-

Friedman Billings notes SLXP share price weakened Friday afternoon as investors became aware that approval for three generic versions of Colazal, for Mylan, Apotex, and Roxanne, had appeared on an FDA Web site. After the market close, SLXP announced that it had started shipping its authorized generic through Watson Pharmaceuticals. Firm is reducing their EPS ests for 2008 to $0.01 from $0.95 and for 2009 to $0.45 from $1.11. They had previously published a tentative EPS est of $0.09 for 2008 with the entry of just one generic Colazal in early 2008. Now with three generics, they anticipate more intensive price competition and faster market penetration for the generics, which reduces the rev to SLXP for its authorized product through WPI. They are also lowering their tgt to $8.50 from $15.
07:03 PTA Penn Treaty Am engages Friedman Billings Ramsey to evaluate strategic alternatives (6.49 )

Co announces it has retained Friedman, Billings, Ramsey to assist its Board of Directors in the review of strategic alternatives to enhance shareholder value. These alternatives could include, but are not limited to, capital structure review, strategic partnerships, business combination transactions or the sale of certain assets. There can be no assurance that the co’s review of strategic alternatives will result in any specific transaction. The co does not expect to disclose any further developments with respect to the exploration of strategic alternatives unless and until its Board of Directors has approved a transaction or other strategic alternative.
07:02 HITK Hi-Tech Pharma acquires Midlothian Laboratories (9.93 )

Co announces the signing of a definitive agreement under which Hi-Tech acquired the assets of Midlothian Laboratories, for $5.0 mln in an all-cash transaction. Additionally, Hi-Tech will pay approx $0.9 mln for inventory and potentially up to $1.0 mln in performance incentives tied to future Midlothian product sales, and the approval of an A.N.D.A. Under the terms of the acquisition the co receives rights to Midlothian’s current product line, consisting of prescription nutritional supplements including pre-natal vitamins and several cough and cold formulations, and future A.N.D.A and non-A.N.D.A products that are in development. Midlothian had sales of approx $5.6 mln and pre-tax income of approx $0.8 mln for calendar 2006.
07:02 MLNM Millennium Pharm: Q4 to be preannounced this Friday; Velcade in good shape - FBR (15.10 )

Friedman Billings notes that in its annual pre-JPMorgan-conference business update this Friday morning, MLNM will preannounce Velcade’s 4Q sales and will guide for 2008. We think that 4Q Velcade sales are in good shape. The November NDC numbers last week allow the scenario matrix inside; it shows favorable odds of Velcade beating the quarter. Regarding 2008, we continue to believe that the product is on a much better trajectory than that which the Street gives it credit for. Firm’s 2008 EPS est falls to $0.41 (from $0.54). With upside to Street expectations, new growth, and low-risk positive events, firm believes MLNM is one of the best biotech stories for 2008.
07:02 CDTI Clean Diesel Technologies receives $8.6 mln upon exercise of warrants (22.62 )

Co announces it has received $8.6 mln in gross proceeds from the exercise of Class B Warrants. All holders exercised their Warrants and purchased 690,490 shares of common stock. The proceeds, net of placement fees, total $8.3 mln and will be used for the continuing commercialization of Clean Diesel’s product offering and core technologies.
06:46 SLXP Salix Pharm downgraded to Sell from Neutral at Piper Jaffray (9.01 )

06:46 PRICE Filings, Offerings, Pricings and IPOs

Filings: Ram Holdings (RAMR) files for a $350 mln mixed shelf offering… Emeritus Corp (ESC) files for a 6.7 mln share offering by selling shareholders… Central Garden (CENT) files for a $500 mln mixed shelf offering.
06:42 PTRY Pantry: Cautiously optimistic that 2008 will be much more solid and believe the current level presents investors with an attractive entry point - FBR (26.25 )

Friedman Billings notes 2007 was tough for PTRY and they are cautiously optimistic that 2008 will be much more solid and believe the current level presents investors with an attractive entry point. They base this on the following: 1) they believe consensus expectations for 1Q08 and FY08 are reasonably low and achievable, 2) they believe the rollout of E10 to the Southeast could eventually benefit Pantry’s margins anywhere from 1.2?-2.5? per gallon, 3) they believe convenience stores represent an attractive defensive play in a weak consumer environment, and 4) they believe PTRY is the most attractively valued stock in the convenience store space.
06:21 S&P futures vs fair value: -0.6. Nasdaq futures vs fair value: -0.5.
06:20 European Markets

FTSE…6439.40…-37.50…-0.6%. DAX…Holiday………
06:20 Asian Markets

Nikkei…Holiday……… Hang Seng…27812.65…+442.05…+1.6%.
06:14 CALLS Early Research Calls I

Upgrades: Merrill Lynch upgrades Tortoise Capital (TTO 12.13) to Buy from Neutral. Downgrades: Broadpoint Capital downgrades Cache (CACH 9.92) to Neutral from Buy, based on lowered Q407 EPS guidance issued by management and December comps that could be negative for the third consecutive month.
06:03 WIRES On The Wires -Update-

LIN TV (TVL) announces that an agreement could not be reached with cable provider Suddenlink Communications. As a result, Suddenlink discontinued carriage of LIN TV’s KXAN-TV in the Austin market and KBIM-TV in the Albuquerque market when the current contract expired on December 31, 2007.
06:02 DPTR Delta Petroleum announces strategic investment in co by Tracinda (15.51 )

Co enters into a strategic financing agreement with Tracinda, a private investment co wholly-owned by Kirk Kerkorian. Under the agreement, Tracinda will invest $684 mln to acquire common stock from the co at $19.00 per share. Under the agreement, which the Delta board of directors has unanimously approved, Tracinda has agreed to purchase 36 mln primary shares of Delta common stock for $19.00 per share. This investment represents approx 35% ownership for Tracinda on a fully-diluted basis. Tracinda will have the right to nominate members to Delta’s board of directors on a pro rata basis reflecting its share ownership, which will initially be one-third of Delta’s board of directors.
05:58 MER Merrill in talks with Chinese and Middle Eastern sovereign-wealth funds to raise capital - NY Post (52.97 )

The NY Post reports Merrill Lynch (MER) is in talks with Chinese and Middle Eastern sovereign-wealth funds to raise capital by selling another “big” stake in the co, Britain’s Observer reported yesterday. The $4.4 bln raised by the sale of stock to Singapore’s Temasek Holdings Pte. last Monday was not enough, the paper cited a US person as saying. Chief Executive Officer John Thain canceled New Year leave for his top executives, sources close to the bank were reported as saying.
05:51 Severstal plans $1 bln investment in U.S. - Financial Times

Financial Times reports Severstal aims to increase profit from its US operations almost threefold by 2010 with the help of a $1 bln investment plan to increase output and improve quality. The plan comes nearly four years after Severstal purchased Rouge Industries, then in bankruptcy, for $285 mln. The project is based on boosting the Ebitda of the former Rouge plant from $144 mln in 2006 to $400 mln in 2010. The co has most of its steel output in Russia but has some operations in France and Italy as well as the US and is studying options for other acquisitions elsewhere. The US profit targets have come from Ron Nock, chief executive of Severstal’s US operations, which are due to increase shipments from the Detroit plant from an expected 2.4 mln tonnes in 2007 to about 4.0 mln tonnes in 2010-11. Mr Nock said he was confident that the plan was realistic, in spite of the poor prognosis for the US economy in 2008 after the subprime lending crisis. “We feel fairly comfortable about trading conditions in 2008,” Mr Nock said. “We’ve been on a rising trend [in terms of finding new customers] for the past couple of years. This is offsetting any reduction in demand due to economic weakness.”
05:38 UBS Singapore not aiming for control of UBS: Report - Retuers (46.10 )

Reuters reports the Singapore government, which recently bought a 9% stake in UBS (UBS), does not aim for operational control over the bank, a Swiss newspaper reported on Sunday. “UBS should not expect any special handling from us,” Lim Siong Guan, group managing director of the Government of Singapore Investment Corp, told the SonntagsBlick newspaper. “We have no desire for control over the business operations of the bank. We are a long-term thinking financial investor, that is only led by commercial considerations,” Lim said. “We have full confidence in (Chairman) Marcel Ospel and his CEO Marcel Rohner,” Lim said.
05:36 HIT Hitachi seen to exit small hard drive business - Reuters (73.27 )

Reuters reports Hitachi (HIT) plans to exit the business of making small hard disk drives as demand shifts to flash memory chips, the Nikkei reported on Sunday. Hitachi’s hard drive unit, Hitachi Global Storage Technologies, has already stopped production of 1-inch hard drives and plans to stop shipping 1.8-inch drives around next summer, the newspaper said. The Nikkei also said Hitachi rival Fujitsu has given up on plans to enter the market for small drives. Fujitsu had been developing 1.8-inch drives with U.S.-based Cornice with plans to bring a product to market in 2007. Hitachi will focus on 2.5-inch and 3.5-drives, anticipating strong demand for the bigger drives that are used in PCs and digital electronics such as DVD recorders, the Nikkei said. The move comes as Hitachi considers selling a stake in its loss-making hard drive business to bring in fresh capital and expertise.
05:34 China Development Bank gets $20 bln state funding - Reuters

Reuters reports China on Monday announced a $20 bln capital injection into China Development Bank, one of the country’s three policy lenders, as part of a long-planned transformation of the state-owned co into a commercial bank. The move is likely to result in a multi-billion dollar stock market listing of the bank. “The capital injection extends the reform pattern of other state banks. It also means that restructuring of CDB will speed up toward commercial operations,” said Yin Jianfeng of Finance Research Institute at the Chinese Academy of Social Science. Government investment vehicle Central Huijin, owned by the country’s sovereign wealth fund China Investment Corp, signed the agreement with CDB on Monday. “The capital injection will boost CDB’s capital base significantly, improve its capability against risks and contributes to the bank’s commercial operations,” China’s central bank said on its Web site.
05:31 IBM IBM to buy Israeli startup for $300 mln: Report - Reuters (110.09 )

Reuters reports IBM (IBM) is in advanced talks to buy Israeli start-up XIV Information Systems for $300 mln to $350 mln, Globes reported on Monday. XIV officials declined to comment. According to Globes, XIV has developed a system that replaces conventional storage technologies through the use of grid technology and less expensive hardware.
05:29 AKH Air France faces myriad hurdles in reviving Alitalia - WSJ (35.09 )

The Wall Street Journal reports Air France-KLM (AKH) moved closer to uniting with Alitalia on Friday, when Italy’s finance ministry — which holds a 49.9% stake in the Italian airline — said it favored Air France-KLM’s bid over that of smaller Italian rival Air One SpA. The two airlines will engage in eight weeks of exclusive talks to hammer out details of a deal that could see the Franco-Dutch carrier take a controlling stake in Alitalia. However, Air France-KLM must overcome political, financial and industrial hurdles. Many political quarters in Italy favor a deal that would keep Alitalia under Italian ownership. Thus, political interference that has long plagued the carrier may still scuttle a deal. Alitalia’s finances are a mess, and the unprofitable carrier will need a massive cash infusion just to keep it flying through the next year. Moreover, Air France-KLM is beginning its talks with Alitalia just as the global economy braces for a downturn that could dent revenue across the airline industry. “To get any value from Alitalia, Air France will have to play a very long game,” said Chris Tarry, an independent aviation analyst in London. Yet the Italian carrier’s operations are in such disarray that “change at Alitalia has to move very quickly.”
05:26 U.K. probes Glaxo, AstraZeneca over Iraqi bribe allegations - WSJ

The Wall Street Journal reports GlaxoSmithKline (GSK) and AstraZeneca (AZN) have been asked to give documents to the UK’s Serious Fraud Office as part of a probe into bribes allegedly paid to the regime of Saddam Hussein. GlaxoSmithKline AstraZeneca said they were cooperating fully with the inquiry, but denied wrongdoing. The fraud-office request was reported by the Sunday Telegraph. The probe, begun in February, is looking at possible breaches of the United Nations’ oil-for-food program. “GlaxoSmithKline doesn’t believe that its employees or its agents in Iraq knowingly engaged in wrongdoing regarding the oil-for-food program,” the co said. “In fact, GSK went to considerable lengths to cooperate with U.K. government authorities responsible for the U.K. administration of the program, and to impose anticorruption measures when dealing with intermediaries in Iraq at a time when the environment was extremely volatile and difficult.” AstraZeneca said it received a request for evidence and would provide relevant papers.
05:22 Morning News Summary: GSK/AZN - AKH - IBM - HIT - UBS - MER

WSJ: U.K. probes Glaxo (GSK), AstraZeneca (AZN) over Iraqi bribe allegations… Air France (AKH) faces myriad hurdles in reviving Alitalia. Reuters: IBM (IBM) to buy Israeli startup for $300 mln: Report… China Development Bank gets $20 bln state funding… Hitachi (HIT) seen to exit small hard drive business… Singapore not aiming for control of UBS (UBS): Report. Financial Times: Severstal plans $1 bln investment in U.S. NY Post: Merrill (MER) in talks with Chinese and Middle Eastern sovereign-wealth funds to raise capital.
02:33 WIRES On The Wires -Update-

Magic Software Enterprises (MGIC) anounces the sale of the entire share capital of Advanced Answers on Demand, a wholly owned subsidiary, to Fortissimo Capital for the sum of $17 mln in cash.
02:17 AEG AEGON and Merrill Lynch finalize strategic relationship; AEGON completes acquisition of Merrill Lynch Life Insurance Companies (17.83 )

Co and Merrill Lynch (MER 52.97) announce they have finalized their agreement to form a strategic business relationship in the areas of insurance and investment products. AEGON USA also completed the acquisition of Merrill Lynch Life Insurance Co and ML Life Insurance Co of New York for $1.25 bln in cash. The purchase price includes excess surplus of approx $425 mln. AEGON expects the acquisition to have a marginally positive effect on EPS. Merrill Lynch expects to record a gain on sale during Q407 and anticipates the transaction to be slightly accretive to EPS.
01:06 COGT Cogent mentioned negatively in Barron’s (11.63 )

Barron’s reports shares of Cogent (COGT) - trading at 26x 2008 estimated EPS and about 8x projected sales - seem expensive. A hedge-fund manager who’s short the stock pegs the shares’ worth closer to 4. His view: “It’s just not a growth company.” The $4 figure would value COGT at two to three times sales, which he believes more accurately depicts its growth status. The coming year is supposed to be better, with an estimated 26% jump in 2008 revenue to $137.3 mln, and EPS of $0.46. The hedge-fund manager, however, is skeptical that Cogent, whose contract-driven revenues are tough to predict, can deliver. COGTs’ troubles are multi-fold. In addition to weak revenue growth, much of their business rests with two customers: George Bush’s U.S. government and Hugo Chavez’s Venezuelan administration; the co’s quarterly financials have been inconsistent, and profits are heavily dependent on interest income. Cogent has some things going for it, including what is regarded as the best biometric technology for fingerprints. And the government programs from Homeland Security and elsewhere haven’t been canceled — only postponed or delayed — which is why seven of 14 brokerage analysts still recommend the stock as a Buy. At the same time, Cogent has tapped new markets, such as corporate sales, “to diversify this lumpy business,” Chief Executive Ming Hsieh says. Hsieh is optimistic that the U.S. government will issue a portion of its contract in 2008 and that Cogent has a “good shot” at getting a big share of it, which would be a huge win. The timing on the British government business is less clear, he says. Cogent has missed consensus revenue targets in eight of the past nine quarters. CFO Paul Kim blames “complex” contracts for creating complicated revenue-recognition policies that make it difficult to forecast accurately.”Revenue predictability has been an issue for the company, and it will continue to be a problem,” Kim says.
01:03 LTR Loews mentioned positively in Barron’s (49.35 )

Barron’s reports shares of Loews (LTR) continue to trade at a discount to its NAV. Its recent decision to spin off its Lorillard tobacco unit could help narrow the gap — and boost the stock price. The transaction may let it shrink its total of outstanding shares by 20% and eliminate much of the remaining tobacco-liability risk that may be hurting its stock. To calculate Loews’ NAV, investors tally the value of the co’s publicly traded investments and the estimated value of its non-public holdings, plus cash. Today, that equals about $64 a share, below current levels.
01:02 BK Bank of NY Mellon mentioned positively in Barron’s (48.50 )

Barron’s reports BNY Mellon (BK) is an attractive play on rising global wealth and the development of securities markets around the world, given its technological scale and cost saving opportunities. And in the weakening financial sector, BNY Mellon’s lack of substantial credit exposure makes it an attractive core holding for investors. BNY Mellon chief executive Robert Kelly says that while, at first glance, his stock might appear fairly valued versus State Street’s (STT) and Northern Trust’s (NTRS), the rapid growth of BK’s asset-management and non-U.S. profits don’t seem to be reflected in the price. “In five years,” Kelly observes, “we could be closer to 50% asset management and close to 50% international,” up from 30% for each right now. BNY Mellon did service some subprime CDOs, though they amounted to less than 5% of 2007 revenue. And the recent slowdown in securities issuance will hurt the growth rate of issuer services, where BNY Mellon handles bond payments and such. Still, the stock’s modest valuation probably would minimize shareholders’ pain in a downturn.
00:58 WIRES On The Wires

B.O.S. Better Online Solutions (BOSC) announces that it is the course of advanced negotiations for the acquisition of assets of Dimex Systems Ltd; BOS intends to acquire the majority of Dimex’s assets in consideration for cash and BOS ordinary shares. The consideration will include approx $4.5 mln for, the purchase of, among other things, intellectual property rights and goodwill. An additional $7 mln will be paid for the purchase of Dimex’s inventory, accounts receivable and fixed assets, and is subject to adjustments based on the 2007 year-end financials of Dimex.
00:57 ELRN Elron announces agreement with Rafael and settlement of claim by Rafael against Elron’s subsidiaries, DEP and RDC

Co announces that Elron and its 100% subsidiary, DEP Technology Holdings, and RDC Rafael Development Ltd., 50.1% held by DEP and 49.9% held by Rafael Advanced Defense Systems Ltd., have executed an agreement amending the existing agreement between the parties pertaining to the rights granted to RDC to commercialize technologies of Rafael and settling the claim filed in September 2006 by Rafael against DEP and RDC in the Tel Aviv District Court. The Addendum will come into effect on January 1, 2008. Pursuant to the Addendum, RDC’s rights to commercialize certain technologies of Rafael will continue without time restrictions. Elron will make a one time investment in RDC of $4 mln and has committed to make further investments of $750,000 in RDC for each company established by RDC based on Rafael’s technologies.
00:53 ENP Encore Energy Partners agrees to acquire assets from Encore Acquisition for $250 mln (18.00 )

Co announces that it has signed a definitive agreement to acquire oil and natural gas producing properties in the Permian and Williston Basins from Encore Acquisition (EAC 34.14) in exchange for total consideration of $250 mln, subject to customary closing conditions and adustments.
00:51 BWTR Basin Water sells rights to Southern Calif. water conveyance assets to Empire Water (9.00 )

Co announces that it has completed a transaction with Empire Water to sell the rights its wholly-owned subsidiary acquired to Southern Calif. water conveyance assets in May 2007 of this year; the right to purchase these assets was owned by Basin Water Resources, a wholly-owned subsidiary of Basin Water. As compensation, Basin Water Resources received 6.0 mln shares of Empire Water at the first closing. It will receive an additional 6.0 mln shares at a second closing to occur before June 30, 2008. These shares will be subject to a one-year lockup. As a second part of the transaction, Empire Water purchased a 1000 gallon per minute nitrate removal system from Basin Water that will be held in inventory until it is deployed at a later date.
00:46 BIDU Baidu.com announces passing of CFO (398.87 )

Co announces that Shawn Wang, CFO, passed away on December 27, 2007 in an accident in China druing the Christmas holiday vacation.
00:45 STO StatoilHydro announces sale of shallow water operations in US Gulf of Mexico to Mariner Energy (31.00 )

Co enters into an agreement to sell all of the former Spinnaker assets in the shallow water of the US Gulf of Mexico to Mariner Energy (ME 22.4 for a cash consideration of $243 mln. The sale will be accomplished through the sale of its wholly owned subsidiary Hydro Gulf of Mexico, LLC. The sale comprises production of approx 9,600 barrels of oil equivalent per day with proven reserves of 8.3 mln barrels oil equivalent.
00:43 DISH EchoStar announces distribution date for the separation of its businesses (36.91 )

Co announcesthat the distribution of shares of common stock of EchoStar Holding will be effective at 12:01 AM MST on January 1, 2008. EchoStar will retain its pay-TV business, DISH Network and EchoStar Holding will hold the technology and certain infrastructure assets of EchoStar Communications, including its set-top box business and certain satellite assets. The record date for the distribution was the close of business (5:00 PM EST) on December 27, 2007. EchoStar plans to change its name to “DISH Network Corporation” following the completion of the separation. Each shareholder of EchoStar will receive for each share of common stock held as of the record date, 0.20 of a share of the same class of common stock of EchoStar Holding.da

Beat Health Life and Fire

Bin Laden to Issue Message on Iraq, U.S. Group Says

Bon Iver

Benazir Assassinated Implications for US Security

Commercial RE Transactions Tumble

The Rise and Fall of Subprime CDO’s

Rick James

Subprime Makes LTCM Crisis Look Tame

Hollaback Remix

08:36 China maintains cap on foreign ownership of brokerages at 33% - Bloomberg

Bloomberg reports China will keep its 33% cap on foreign ownership of joint-venture brokerages, resisting opening its mkt further to foreign competition. Revised rules, which take effect next year, relax some requirements for foreigners. The regulations will let investors from abroad buy into publicly traded brokerages and cap foreign ownership at 20% for single investors, and 25% for total foreign-owned stakes, the China Securities Regulatory Commission said in a statement on its Web site today. The limit for private ventures will remain at 33%.
08:33 WIRES On The Wires -Update-

Empire Financial Holding (EFH) announces that on Jan 2, 2008 it will change its name to Jesup & Lamont… Par Pharmaceutical Companies (PRX) provided an update on the development status of its three, in-licensed, proprietary pipeline products: pafuramidine, Loramyc, and Zensana.
08:31 BSX Boston Scientific announces CE Mark approval for next-generation cardiac resynchronization therapy defibrillator (11.71 )

CO announces CE Mark approval for its LIVIAN cardiac resynchronization therapy defibrillator.
08:31 LNCR Lincare reports intention to file shelf registration statement (35.48 )

Co announces that it intends to file with the SEC a resale shelf registration statement on or before January 29, 2008 on Form S-3 pursuant to the terms of a registration rights agreement Lincare entered into on October 31, 2007 in connection with the sale of its $275 mln principal amount of convertible senior debentures due 2037 - Series A and $275 mln principal amount of convertible senior debentures due 2037 - Series B and the shares of Lincare common stock issuable upon conversion of the Debentures.
08:30 GBT Advanced Battery forms development partnership with Shenzhen HuaJin Science & Technology (4.69 )

Co announces that it has entered into a cooperation agreement with Shenzhen HuaJin Science & Technology. Under the agreement, the companies will collaborate to develop and manufacture innovative energy-saving lamps for multiple uses.
08:30 ADLR Adolor announces investigational New Drug Application for novel delta agonist ADL5747 (4,64 )

Co announces that clinical testing will be permitted under an Investigational New Drug Application for ADL5747, a novel oral compound that targets the Delta opioid receptor. Co expects to initiate Phase 1 clinical testing in the first quarter of 2008. ADL5747 is the second delta compound that will enter clinical investigation under Adolor’s worldwide collaboration with PFE to develop novel pain compounds. A lead compound, ADL5859, is in Phase 2 clinical testing in several pain conditions.
08:30 S&P futures vs fair value: +14.5. Nasdaq futures vs fair value: +15.5.

It is still shaping up to be a higher start. On the economic front, December Chicago PMI will be released at 9:45 ET, and November new home sales will be released at 10:00 ET. Economists expect the PMI reading to dip to 52.0 and 715K new home sales.
08:29 GCO Genesco announces that Court orders specific performance of merger agreement by The Finish Line (33.06 ) -Update-

Co announces that the Chancery Court for the State of Tennessee has ordered The Finish Line (FINL) to specifically perform the terms of its Merger Agreement with GCO. In relevant part, the Court’s order states: “It is therefore ordered that the Court declares that all conditions to the Merger Agreement have been met. The Court declares that Finish Line has breached the Merger Agreement by not closing and declares that Finish Line is not entitled to invoke the December 31, 2007 termination procedures of Section 8 of the Merger Agreement. The Court ORDERS that Finish Line shall specifically perform the terms of the Merger Agreement…”
08:26 China telecoms revamp marked for next year - South China Morning Post

South China Morning Post reports the long-awaited restructuring of the mainland telecommunications industry would start next year, the Ministry of Information Industry said yesterday, in a move that may see the break-up of one telephone giant and more consumer choice. The govt also signalled it was ready to launch its high-speed 3G wireless network next year, based on home-grown technology. China Unicom (CHU) is expected to be broken up under the restructuring, with the three remaining operators - China Telecom (CHA), China Mobile (CHL) and China Netcom (CN) - to provide a broader range of services, including fixed-line, mobile and broadband. “We will actively push a restructuring plan as soon as possible next year so that telecoms operators can provide full-range services,” Minister of Information Industry Wang Xudong said. “Restructuring the industry is vital for further development.” China Telecom is expected to be the biggest winner out of the restructuring as the fixed-line market has poor growth prospects compared with mobile and broadband services. China Mobile will face increased competition under the plan.
08:25 SY Sybase: Sandell notifies Sybase of intention to nominate alternative slate of directors at 2008 annual meeting (25.88 )

Sandell Asset Management announces that it has notified SY of its intention to nominate three highly qualified independent candidates for election to the board of directors at the 2008 annual meeting of stockholders. This action follows the letter and presentation sent to SY on Oct 12th, 2007 that detailed specific actions Sandell believed the co should take to improve value for all shareholders. Specifically, Sandell requested that the co’s mgmt and board of directors immediately take one or more of the following actions: 1) IPO and spin-off 100% of Mobility segment; 2) aggressive use of the balance sheet to repurchase shares’ 3) sale of the co in whole or in part. “We have attempted to encourage the Company, both publicly and privately, to take action to improve its current discounted share price, but have been very frustrated by the apparent complacency of the board and management toward creating value. We feel that shareholder representation on the board is warranted to ensure that all alternatives are considered and a course of action is taken to close the gap between the current share price and its inherent value.”
08:22 FLIR FLIR Systems: $70 bln “bridge” bill includes $340 mln for G-BOSS, raising ests & tgt to $41 - TWP (30.56 ) -Update-

Thomas Weisel raises their 2008 EPS est and raises their tgt to $41 from $38.50, saying they have confirmed that the $70 bln “bridge” supplemental includes funding of $340 mln for G-BOSS, a key program for FLIR. Firm estimates that FLIR’s share of the $340 mln is $145 mln, and that the spring supplemental could include up to $300 mln more, of which FLIR’s share would be around $130 mln.
08:22 BONDX Bond Watch: Following Through

The market remains bid as the global push to safety continued overnight. Turmoil in the nuke-possessing Pakistan leads the headlines fueling such sentiment while the declining global economic outlook is a close runner-up. The 2-10-yr yield spread hustled its way steeper to 101.9 overnight but has since pulled back in to 97.2 as curve trade faded the move. Bond prices in the EuroZone also benefited from a softer inflation report out of Germany while in Japan, bond prices blew higher in a shortened pre-holiday session. Treasuries will poke through some manufacturing & housing numbers this morning with expectations pretty low. The market made a strong recovery from Wed’s weakness yesterday & mostly bulls will be looking to see today’s pre-market follow-through maintained. Should the momentum stall trade could turn quickly, particularly if the data isn’t bad enough. While the perk in prices is welcomed the Dec correction is still playing out & may yet have room to run on the downside. The dollar is still tracking lower against the majors including the yen which is benefiting from risk aversion carry unwind. The euro has reclaimed the 1.4700 tentatively with headwinds above at 1.4725. Spot gold is charging higher at 832.60 (+7.20) while crude oil is up just a bit at 96.76 (+0.14). The calendar has Chicago PMI (9:45) & new home sales (10). The euro is at 1.4987 & the yen is at 113.0550 while the 10-yr is +11/32 yielding 4.152%. For more bond & economic commentary click here.
08:21 NVDA NVIDIA to postpone shipments of MCP72 chipset family to January - DigiTimes (35.14 )

DigiTimes reports the co originally planned to roll out the new MCP72 chipset in late November or early December but will now postpone shipping to January, along with the planned launch of its MCP78, according to sources at Taiwan motherboard makers. The sources detailed that Nvidia will introduce the new nForce 700a chipset family for AMD platforms, which includes MCP72XE, MCP72P and MCP78H in January, in attempts to compete with AMD’s rival RD790 chipset.
08:20 SCANX Early pre-market gappers

Gapping up: GCO +19.8%, CALM +12.2%, SIX +11.1%, CLWT +11.0%, CHRD +10.8%, CHINA +9.5%, DNDN +8.1%, MLNM +5.8%, SOLF +5.2%, ALXA +4.7%, LUB +4.6%, CYD +4.4%, CBAK +4.3%, SYNX +4.2%, NEM +3.6%, SLM +3.3%, CSIQ +3.1%, HOKU +2.8%, WM +2.7%, GFI +2.0%, TOT +2.0%, TIN +1.9%, CSUN +1.8%, FCN +1.7%, HAFC +1.7%, RTP +1.5%, BIDU +1.2%, ABX +1.1%, C +1.0%, PAAS +1.0%, SI +1.0%… Gapping down: ADPI -4.3%, MBI -3.9%, THRX -3.8%, ABK -3.6%, MESA -2.9%, CBK -2.9%, GOLD -1.6%.
08:19 SGR Shaw Group announces completion of SEC inquiry (59.77 )

Co announces that it has received notification from the SEC that the SEC’s Division of Enforcement has completed its informal inquiry, which the company announced in June 2004, and that the Division of Enforcement does not intend to recommend any enforcement action.
08:13 DNDN Dendreon: Color on pre-mkt strength (6.18 )

DNDN is trading up 5% this morning following a Fast Money segment last night that highlighted DNDN as a healthcare play in 2008 (the stock spiked as high as $7 in after-hours). During the segment a CNBC commentator noted that DNDN is expected to release preliminary data in the middle of 2008 to see whether the co’s Provenge drug extends the lives of prostate cancer patients. He noted that if it does, DNDN says the FDA has told the co that it might approve the drug. (Briefing.com note: DNDN saw heavy call buying yesterday prior to the Fast Money segment, with a total of 28.6K Jan08 7.50 calls trading vs open interest of 219K — see yesterday’s 13:17 OPTNX comment for further details on the options trading)
08:11 AUO AU Optronics says could see shortage in global LCDs in 2008 - Reuters (18.31 )

Reuters reports the co said there could be a supply shortage of LCDs in the global market next year. “Supply is seen to grow by 22 to 25 percent, but demand is seen growing by 28 to 30 percent,” an official from AU, who declined to be identified, told a news conference, referring to LCD panels. The official also said the company’s first-quarter sales for next year would not be as weak as the first quarters of previous years.
08:10 WMT Wal-Mart cancels movie download service - Reuters (47.77 )

Reuters reports the co quietly canceled its online video download service less than a year after the site went live, a spokeswoman said on Thursday. Wal-Mart shut down the download site after Hewlett Packard discontinued the technology that powered it, Walmart.com spokeswoman Amy Colella said in an e-mail. She added that it will not look for another technology partner. HPQ spokesman Hector Marinez said the co decided to discontinue its video download-only merchant store services because the mkt for paid video downloads did not perform “as expected.” He noted that the Internet video business remains uncertain and is changing rapidly. (BBI, NFLX)
08:08 COP ConocoPhillips OKs sale of China gas field to EOG, sources say - DJ (88.65 )

DJ reports the co has agreed to sell its Chuan Zhong natural gas block in China’s Sichuan province to Houston-based EOG Resources (EOG), two people familiar with the deal said Friday. The Chuan Zhong block, which covers an area of 295,000 acres in southwestern China and includes the Ba Jiao Chang gas field, produced an average of 10.3 mln cubic feet of natural gas a day in 2006. The deal marks EOG Resources’ return to China’s energy sector and will see it resume ownership of the Chuan Zhong gas block, which it sold some years earlier to Burlington Resources.
08:07 WSM Williams-Sonoma: Tough holiday environment, but material surprise to guidance unlikely- Thomas Weisel (26.34 )

Thomas Weisel notes WSM shares have declined 13.7% over the last three weeks, and the market appears to have priced in some downside to 4Q results. Firm says the retail environment is admittedly more sluggish than expected, although their analysis suggests that trends are not likely to be worse than the year ago quarter, when the slowing environment caught Pottery Barn by surprise.
08:04 BONDX Economic Calendar

Chicago PMI at 9:45 & new home sales at 10.
08:04 MRGE Merge Healthcare reports Q2 and restates previous results (1.40 )

Co reports Q2 GAAP EPS of ($0.32), includes charges, may not compare to ($0.26) consensus; reports revs of $14.0 mln vs $14.5 mln consensus. Co also announces it has filed restated financial statements for the years ended December 31, 2006, 2005 and 2004 and for the three months ended March 31, 2007 and 2006
08:03 TRMP Trump Entertainment: New credit facility should eliminate financing concerns (4.29 )

Brean Murray notes late yesterday, TRMP announced that it entered into a new $493 mln first lien mortgage credit facility that will be used to refinance all of the co’s current first lien debt. The new agreement eliminates requirements to maintain certain leverage, first lien leverage and interest coverage ratios, which the firm says, should be a positive for the stock. The new agreement should alleviate concerns over funding the completion of the Taj Hotel Tower and concerns regarding debt covenants.
08:02 MLNM Millennium Pharm to receive $40 mln milestone payment for achievement of sales threshold for Velcade (Bortezomib) for injection (15.13 )

Co announces that it will receive a $40 mln payment from Ortho Biotech Products for achieving a material sales milestone in 2007 for Velcade outside the U.S. Milestone payments are recorded in the strategic alliance revenue line on the co’s income statement.
08:01 S&P futures vs fair value: +15.0. Nasdaq futures vs fair value: +17.0.

Stocks are poised to start the day on a positive note. There is not a specific news item that accounts for the positive sentiment, although there is a sense that the market over-reacted to the news of Benazir Bhutto’s death. Reports that Berkshire Hathaway (BRK.A) is buying a reinsurance unit from ING is making headlines this morning.
08:00 CSC Computer Sciences wins $613 mln Defense Information Systems Agency contract for Information Systems Network Support (49.61 )

Co announces that it has been awarded the Defense Information System Network Network Management Support Services-Global Recompete Network Engineering contract from the Defense Information Systems Agency. The indefinite-delivery/ indefinite-quantity contract, which has a two-year base period and three one-year options, has a contract ceiling amount of $613 mln if all options are exercised. This contract is the result of a competed acquisition, and is a continuation of the previous DISN Network Management Support Services-Global Network Engineering Contract. The DNMSS-G contract was awarded to CSC in June 1999.
08:00 CRIS Curis announces sale of its BMP-7 assets to Stryker (1.02 )

Co announces that it has entered into an agreement to sell and assign its remaining BMP-7 technologies to Stryker. CRIS will receive an initial payment of $1 mln, which is net of a payment to be made by Curis to a former third party collaborator of Creative BioMolecules, a predecessor company involved in the 2000 merger that formed Curis. In addition to the initial payment, Stryker has agreed to make cash payments to Curis upon the successful achievement of specified clinical development and drug approval objectives. In lieu of royalty payments, Stryker has also agreed to pay additional cash payments upon the achievement of specified net product sales targets, should such targets be achieved within contractually-specified time periods that are based on the expiration of valid claims of Curis’ BMP-7 intellectual property. Assuming that at least one product is successfully developed and commercialized by Stryker on a global basis, Curis could receive up to approximately $41 mln in such payments. However, in connection with its receipt of such payments, Curis would be required to make payments of up to approximately $14 mln to the former third-party collaborator if such product candidates or products are designed to treat certain indications affecting chronic kidney disease patients.
08:00 AVNX Avanex: The stock is oversold; and a buying opportunity - Roth Capital (0.97 )

Roth Capital notes yesterday AVNX reported that it filed an arbitration complaint against 3S Photonics of France. As a result of 3S’ premature termination of the distribution agreement, the co expects that revenue for F2Q will be in the range of $51-53 mln, compared to the previous guidance of $56-58 mln. The firm believes the gross margin expansion strategy remains intact. As a result of yesterday’s pullback, the stock is trading at 0.84x FY08 revenue estimate, which they believe is an attractive entry point, especially considering the company has $46.5 mln or $0.20 per share in cash and no debt. They believe the stock was oversold, and as a result, would view the pullback as a buying opportunity.
07:55 AET Aetna to end payment for a drug in colonoscopies - NY Times (57.78 )

NY Times reports the co is the latest insurer to clamp down on the use of a powerful anesthetic during an increasingly common form of colon cancer screening. The co will send a letter to doctors on Friday, saying that it plans to classify the drug as “medically unnecessary” for most such procedures. As of April 1, Aetna plans to stop paying for its use in those cases. Critics say Aetna’s decision would be a step backward in the battle against cancer of the colon and rectum, which trails only lung and prostate cancer as a cause of cancer death among Americans, according to the federal Centers for Disease Control… All three major medical associations for specialists who perform colonoscopies have published guidance statements saying the anesthetic was not needed for routine procedures.
07:55 LXP Lexington tgt cut to $19 from $24 at Cantor Fitzgerald (14.64 )

Cantor Fitzgerald cuts their tgt on LXP to $19 from $24 noting on Monday, after market close, Lexington announced a $2.10 per share special dividend due to planned asset sales. The firm expects another special dividend in 2008 as a result of additional planned asset sales. The firm continues to rate the shares of Lexington a Buy based on a high quality portfolio, attractive and secure dividend yield, strong portfolio operating performance and a well positioned balance sheet
07:52 MGM MGM Mirage: Dubai World increases MGM Mirage stake - WSJ (84.25 )

WSJ reports Dubai World increased its stake in casino operator MGM Mirage to 6.5% after agreeing to buy five million shares from a foundation founded by MGM controlling shareholder Kirk Kerkorian. Dubai World, a holding company for the Persian Gulf state that previously held a 5% stake in MGM, bought its additional shares from the Lincy Foundation for $424 million, or $84.80 a share. The deal was announced Friday in a filing with the SEC. In the filing, Dubai World said the purchase was for investment purposes.
07:52 ATK Alliant Tech initiated with a Neutral at Cowen (116.50 )
07:51 ENDP Endo Pharm: Think Phase I inhaled fentanyl compound could be a substantially differentiated product- Baird (26.86 )

Baird maintains their Outperform and recommend purchase of the stock following the in-licensing of a Phase I inhaled fentanyl compound from Alexza (ALXA). They think this device system could be a substantially differentiated product, but need to see more data to determine its viability in the marketplace. In light of FDA’s very conservative stance, the firm says they also need to be assured that there will be no safety concerns with the product.
07:49 ARTC ArthroCare: Discounting the Discocare rumors- Oppenheimer (48.12 )

Oppenheimer says when the N.Y Post published a negative article with a questionable source of information and that was followed by negative research reports from little known companies about a stock that is heavily shorted, they became skeptical. The firm says while it is unclear if Discocare has done anything wrong, they believe at most Discocare is responsible for less than 3% of Arthrocare’s rev. Even if Discocare has broken the law, they doubt that this applies to all related revenue. They believe this issue has been blown out of proportion. Firm reits Buy and $70 tgt.
07:49 Stock Index futures rally sharply in recent trade, make new morning highs

Currently, Mar. S&P 500 @ 1502.00 +12.25. Mar. Nasdaq 100 @ 2144.00 +12.50. Mar. Dow @ 13546 +87.
07:47 Gold to pass record in 2008 on inflation, survey says - Bloomberg.com

Bloomberg.com story discusses the outlook for Gold, saying Gold will rise to a record in 2008, increasing for an unprecedented eighth consecutive year, as investors seek protection from accelerating inflation, metals analysts say. Gold will probably average $800 an ounce, compared with $696 this year, according to the median estimate of 37 traders, analysts and investors surveyed by Bloomberg News. Gold has gained 30% to $827.20 an ounce in London this year, its best year since 1979, when the Iranian revolution crippled crude- oil exports and U.S. inflation surpassed 13%. Prices may gain as much as $100 in 2008, because of production shortages, said Graham Birch, the London-based head of BlackRock’s natural resources team that manages $40 bln. “The price needs to be north of $1,000,” he said. “$800 is not enough to reverse the gradual decline in production.”
07:45 Hedge funds feeling pinch on credit, too - WSJ

WSJ reports it isn’t just consumers who are having a harder time getting credit from lenders. It’s hedge funds, too. Investment banks are cutting back on loans to hedge funds, eliminating some clients and raising borrowing fees for others. The lenders are slimming their balance sheets after heavy losses in the debt mkts in recent months. And, after taking multibillion-dollar write-downs, they also are becoming more cautious as the economy slows, according to people familiar with the situation. If the change continues, it could put some pressure on the profits of the prime-brokerage units of the major banks. The move also could put pressure on the returns of some hedge funds, which often rely on healthy doses of borrowed money, or leverage, to boost their returns.
07:43 EFOI Energy Focus: New distribution agreement with TCP gives EFOI the broad marketing and sales reach needed to penetrate high efficiency lighting market - Merriman (6.85 )

Merriman says Energy Focus has established a broad marketing and sales reach into the commercial and industrial markets as a result of its private label alliance with T.C.P. The private label alliance with T.C.P includes three LED based lighting products — the LED based EFO Dock Light, the Armada Globe and the Light Rail. The firm says shipments of the Dock Light to T.C.P are expected begin immediately. The firm says Energy Focus articulated its success in developing new efficient lighting solutions for the military, which they believe could translate into significant EFO lighting sales to this important vertical next year.
07:42 MS Morgan Stanley’s CICC stake in doubt - FT (53.32 )

FT reports the $5 bln investment in China Investment, the sovereign wealth fund, by the co is raising questions about the future of the cash-strapped US bank’s stake in one of China’s premier investment banks. Its 34% passive holding in China International Capital is a source of cash for Morgan Stanley, which this month announced its first quarterly loss and $9.4 bln of writedowns on subprime losses. There would be plenty of potential buyers should Morgan Stanley decide to sell its stake, including private equity cos and foreign securities cos seeking a substantial foothold in China’s growing mkt.
07:35 Pound falls to a record against Euro as U.K. house prices drop - Bloomberg.com

Bloomberg.com reports the pound fell to a record low against the euro for a seventh day, reversing an earlier gain, after an industry report showed house prices declined for a second month in December. Home values dropped 0.5% from November, when they fell 0.8%. Traders raised bets on the Bank of England cutting interest rates next year as the drop in house prices adds to signs of slower economic growth. Briefing.com note: U.S. New Home Sales data is due out at 10:00 (ET) today.
07:31 RSYS RadiSys: Expect solid 4Q07; reducing FY08 and FY09 projections- Cantor Fitzgerald (13.64 )

Cantor Fitzgerald says they are making a number of revisions to their financial model. First, they believe that 4Q:07 has tracked ahead of their initial expectations and, are increasing their 4Q:07 rev and EPS ests from $94.3 mln and $0.11 to $96. 4 mln and $0.13, respectively (consensus is $0.12 on $95.36 mln). Second, firm believes they may have been too aggressive regarding FY:08 and FY:09 outlook as it relates to Nokia (NOK) and are therefore tweaking down their FY:08 and FY:09 revenue and EPS projections. FY:08 revs have been reduced to $382.8 mln from $388.0 mln and EPS declines to $0.47 from $0.52 (consensus is $0.54 on $383 mln)
07:30 Most Asian markets fall on Bhutto death - Newsweek

Newsweek reports most Asian mkts fell amid anxiety over the assassination of Pakistani opposition leader Benazir Bhutto and lingering worries about the outlook for the U.S. economy. Bhutto’s death on Thursday, just ahead of Jan. 8 elections, sent shock waves through international markets on worries that global instability may follow, although some analysts said the impact is likely to be limited. While Pakistan’s stock mkt was closed, the mkt reaction in neighboring India was muted. Mumbai’s Sensex index dipped 0.1%. In Tokyo, Japan’s stock market wrapped up the year with a sharp drop. The Nikkei 225 index fell 1.7%. Mainland Chinese mkts ended a stellar if turbulent year on a down note. The Shanghai Composite index fell 0.9% on worries that authorities will raise interest rates or take other steps to cool the country’s blazing growth. In Hong Kong, jitters over Bhutto’s assassination and continued concerns about the U.S. economy dragged down the benchmark Hang Seng Index by 1.7%.
07:30 CHINA CDC Corp says co insiders purchased 467,825 shares during last nine trading days (4.11 )

Co announces that directors and executives have purchased a net amount of approximately 467,825 shares since the insider trading window was opened on December 17, 2007. Additionally, during the fourth quarter of 2007, the company and its subsidiaries repurchased 366,000 common shares at an average price of US$6.31 per share for a total of US$2,309,246.
07:30 MYL Mylan Labs announces final FDA approval for Cetirizine Hydrochloride tablets (13.80 )

Co announces it has received final approval from the FDA for its Abbreviated New Drug Application for Cetirizine Hydrochloride Tablets, 5 mg and 10 mg.
07:26 ING ING to sell N.R.G. unit to Berkshire Hathaway - Fox Business (38.90 )

Fox Business reports the co announced today that it has reached an agreement with Berkshire Hathaway Group (BRK.A) to sell its reinsurance unit N.R.G. for approximately EUR 300 mln. The sale is part of ING’s strategy to focus on its core insurance, banking and asset mgmt businesses.
07:21 FREE Freeseas significantly expands fleet with accretive acquisitions- Cantor Firtzgerald (5.31 )

Cantor Fitzgerald notes Wednesday, FreeSeas announced it agreed to purchase two Handysize vessels for an aggregate price of $76.8 mln. The firm says no charter has yet been arranged for the two new vessels, so for modeling purposes they assume the ships are fixed for short-term charters at a rate of $30,000 per vessel/day. Firm says they are encouraged to see FreeSeas utilize some of the cash from their public equity offering in October 2007 to make accretive acquisitions. They note that the co still retains cash on the balance sheet to make additional vessel purchases.
07:20 Citigroup, Goldman cut LBO overhang with discounts up to 10% - Bloomberg

Bloomberg reports Citigroup (C), Goldman Sachs (GS), Morgan Stanley (MS) and JPMorgan (JPM) are offering discounts of as much as 10 cents on the dollar to clear a $231 bln backlog of high-yield bonds and loans. While lenders reduced the overhang by 32% since July, they are struggling to unload debt from this year’s record $438 bln of leveraged buyouts after losses from securities linked to subprime mortgages reduced demand for higher-yielding assets, according to data compiled by Bloomberg. They sold some bonds at a discount of 10% to face value and loans at 5% below par, according to Barclays.
07:16 FTK Flotek Industries profiled in New America section of IBD (38.32 )

IBD reports oil is big business, especially when commodity prices are high and demand strong. As oil cos crank up drilling in such an environment, the work trickles down to oil field services providers and their suppliers. One of the suppliers to the suppliers is Flotek Industries. It focuses on specialty chemicals used in drilling, as well as drilling tools and gas extraction gear. Flotek’s customers include three of the biggest names in the oil field services industry, Halliburton, Schlumberger and BJ Services. Flotek’s overall sales have taken off since 2003 when the co took in just $15 mln. By last year, the sum was $101 mln. Earlier this year, Schlumberger and BJ Services decided to add the “green” chemicals to their tool chest as well. While Halliburton is one of if not the biggest buyer of Flotek’s “green” additives, BJ and Schlumberger are still in the early stages of getting their customers onboard. Flotek’s half-dozen or so environmentally friendly microemulsion additives — protected by patents and trade secrets — give the co a competitive edge in a packed mkt. Analysts expect expanded use of microemulsions in already productive oil fields to provide another leg of growth. Most of Flotek’s jobs are in the U.S., but Flotek has been making a push to expand internationally. Flotek will earn an estimated $1.01 a share in 2007, up from 61 cents in 2006, according to analysts polled by Thomson Financial. The analysts expect earnings to jump 80% in 2008, to $1.82 a share, and move up 51% in 2009.
07:11 CHRD Chordiant Sftwr signs largest deal ever with Vodafone; further proof CHRD is more than banks- CIBC (8.12 )

CIBC notes yesterday after the close, CHRD filed an 8-K detailing a ~$26 mln transaction with Vodafone (VOD). This deal, the largest in CHRD’s history, is yet another demonstration of increasing geographic and vertical diversity in its business and is the first time it has entered A.P.A.C. Firm says this transaction will contribute, at worst, $18.9 mln of license revenue overall, including $9.1 mln in FY08, giving CHRD additional visibility. The firm notes the co guided and the Q1 shortfall is attributable to higher commission expense and lower than expected revenue from VOD in F1Q. They say the pre-announcement is mostly a non-event.
07:02 CALM Cal-Maine Foods reports Q2 EPS of $1.69 vs $0.27 in yr ago period; revs $223.69 mln vs $137.73 mln in yr ago period (25.85 )

“Looking ahead, our feed costs remain high, and we expect this trend to continue with the high demand for corn for ethanol use creating additional price pressures. However, both the egg industry and the USDA predict that egg production will be similar to 2007 levels, and this should support profitable egg prices for the year ahead”.
07:01 CYD China Yuchai subsidiary wins major awards in Chinese auto parts convention (9.87 )

Co announces that its subsidiary, Guangxi Yuchai Machinery, has won three major awards at the China International Summit Forum on the Auto Parts Industry in Beijing.
07:01 NCOC National Coal Corp. announces it has sold two mln shares of its common stock in a private placement netting total proceeds of approx $8 mln (5.74 )
06:52 CTV Commscope: Est CTV EPS accretion of $0.19, or 6% from the deal in 2008- Baird (31.39 )

Baird notes the co closed the acquisition of Andrew Corporation for $2.65 billion ($13.50 in cash, $1.50 in CTV stock per share). They estimate EPS accretion of $0.19, or 6% from the deal in 2008. There may be some near-term uncertainty until new guidance is issued, but the firm believes the combined co has significant opportunities to drive EPS growth through synergies/cost saving programs. Firm reits their Outperform and $55 tgt.
06:49 GCO Judge rules for Genesco in $1.5 bln buyout - AP (33.06 )

AP reports a judge rules Thursday that Genesco (GCO) executives did not commit fraud during negotiations over a $1.5 bln acquisition and that Finish Line (FINL 3.05) must complete the purchase. Nashville Chancellor Ellen Hobbs Lyle dismissed Finish Line’s claims that Genesco withheld key financial information that could have signaled worse-than-expected earnings after the deal closed in June. Lyle said Finish Line and UBS (UBS) were sophisticated enough to know what they were getting into with the $54.50-per-share purchase. That case is still pending, but Lyle disagreed that the combined co would be doomed. “The merger has a reasonable chance of succeeding,” she said.
06:38 CALLS Early Research Calls I

Downgrades: Bear Stearns downgrades MSC Industrial (MSM 41.70) to Peer Perform from Outperform. Miscellaneous: Lehman initiates El Paso Pipline Partners (EPB 24.92) with an Overweight… Standpoint Research initiates Ambac Financial (ABK 29.14) with a Buy and sets a 3-yr tgt of $58, based on shares that trade at 0.55x book value, 4x cash flow, 4x earnings (’09) and believe that despite exposure to sub-prime, ABK is a solid underwriter with safe risk and capital management practices in place.
06:30 Weak banks, carmakers end European stocks rally

European stocks dipped in early trade on Friday, falling for the first time in five sessions as banking shares slipped on renewed worries over the global credit crunch. Geopolitical concerns following the assassination of Pakistani opposition leader Benazir Bhutto also dampened the mood in equity markets around the world… Around Europe, Germany’s DAX index shed 0.4%, UK’s FTSE 100 index was down 0.6% and France’s CAC 40 fell 0.6%. (Reuters)
06:29 Asian stocks fall as Bhutto assassination highlights geopolitical risk; Sensex ends down 10pts

Asian stock markets fell Friday after the assassination of Pakistani opposition leader Benazir Bhutto heightened geopolitical risk, sending Wall Street sharply lower and leading Japan to an almost 2% decline on its final day of trade for the year. The Karachi Stock Exchange is closed for three days as the nation observes a period of mourning for the slain politician… The Nikkei closed a truncated session down 1.7% at 15,307.78. Japanese financial markets will be closed from Dec 31 through Jan 3. The Hang Seng fell 1.1% to 27,546.82, while the South Korean KOSPI closed down 0.6% at 1,897.13. The Shanghai Composite was down 0.89% at 5,261.56… Mirroring the weak trend in the global markets following the assassination of former Pakistan Prime Minister Benazir Bhutto, the Sensex opened with a negative gap of 59 points at 20,158. Fresh buying at lower levels saw the index move into positive zone and touch a high of 20,259. The index, thereafter, exhibited lacklustre movement for the major part of the day before slipping to a low of 20,023 - down 236 points from the day’s high. Late buying saw the index move up, once again, into positive zone and finally end with a marginal loss of 10 points at 20,207. (Thomson, The Business Standard)
06:20 S&P futures vs fair value: +8.2. Nasdaq futures vs fair value: +6.8.
06:19 European Markets

FTSE…6470.20…-27.60…-0.4%. DAX…8027.40…-11.20…-0.1%.
06:19 Asian Markets

Nikkei…15307.78…-256.91…-1.7%. Hang Seng…27370.60…-472.33…-1.7%.
05:37 CSHB Community Shore Bank reports Q4 increases in loan loss provision (6.36 )

Co announces that it will take an additional provision in Q4 for the impairment of one commercial loan that is part of a $5 mln relationship. In addition to the C&I loan, this relationship includes loans collateralized by commercial real estate and one residential construction project. Community Shores is also increasing its reserve allocation for loans to residential real estate and land developers due to deteriorating conditions in the Bank’s local market. The co estimates its Q4 provision for loan losses to be approx $1.0 mln. This estimate provides for a specific allocation of $689,000 related to the impairment of the previously-mentioned C&I loan. Additionally, an increased allocation of $100,000 has been made on its $15 mln portfolio of residential and land development loans. The increased provision should lower pre-tax earnings by approx $0.68 per diluted share when CSHB reports its financial results for Q407 and FY07.
05:28 GSK Glaxo says Advair shows edge over Spiriva in COPD - Reuters (51.32 )

Reuters reports GlaxoSmithKline (GSK) said on Friday that clinical trial results showed its top-seller Advair had an edge over Pfizer’s (PFE) rival product Spiriva in treating patients with the lung disease COPD. A two-year study of 1,300 patients found both drugs had a similar impact on rate of exacerbations, but people treated with Advair gained a significant improvement in health status and greater survival benefit than those on Spiriva, the firm said. Advair reduced the risk of patients with chronic obstructive pulmonary disease dying from any cause by 52% compared with patients on Spiriva. Results of the first head-to-head study of the two medicines in COPD were published in the American Journal of Respiratory and Critical Care Medicine. While the number of exacerbations — or sudden worsening of symptoms — was not significantly different between the two groups, cases requiring antibiotics were more frequent in patients on Advair while exacerbations needing systemic steroids were more common with Spiriva.
05:25 Citigroup, HSBC among banks considering selling units - WSJ

The Wall Street Journal reports in a sign that tougher times lie ahead, U.S. and European banks are considering sales of everything from branches to entire units. Possible sellers include Citigroup (C), which may unload or shut several midsize units, and HSBC Holdings plc (HBC), which could exit all or parts of its $13 bln auto-finance business, say people familiar with the situation. “I think we are going to see a real wave of these coming through in the first half of next year,” says Huw van Steenis, a banking analyst at Morgan Stanley in London. Spokeswomen for HSBC and Citigroup declined to comment on any potential asset sales. Some executives estimate that Citigroup could dispose of as much as $12 bln worth of what are considered noncritical assets, according to the Journal. Units it could possibly shed include Student Loan Corp., which is 80% owned by the bank; its N. American auto lending business; Brazilian credit card co Redecard SA, in which Citigroup held a 24% stake as of September 30; and its Japanese consumer finance business, according to the Journal.
05:19 BRK.A Buffett to start a bond insurer for cities, states - WSJ (137800 )

The Wall Street Journal reports Warren Buffett is starting up a bond insurer that aims to make it cheaper for local governments to borrow and promises to be a tough competitor for the industry’s incumbents. The investor’s Berkshire Hathaway Assurance Corp., set to open for business today in New York state, will guarantee the bonds that cities, counties and states use to finance sewer systems, schools, hospitals and other public projects. The new venture, backed by an almost-certain triple-A credit rating, is likely to be cheered by municipalities and municipal-bond investors because it will offer them an alternative at a time when other bond insurers’ ratings look suspect. Mr. Buffett said in an interview that interest appears high enough for the new co to seek permission to operate in other states that account for a large chunk of municipal-debt issuance. After New York, he and Ajit Jain, who heads Mr. Buffett’s insurance businesses, will seek approval to open in California, Puerto Rico, Texas, Illinois and Florida. “Ideally we’d be licensed in every state, but there’s a limit to what we can do,” Mr. Buffett told The Wall Street Journal. “We can’t guarantee everything, and we will not take risk beyond what’s prudent for us.” He added, however, that he would commit “quite a bit of capital if we like the business.”
05:11 Morning News Summary: BRK.A - C/HBC - GSK

WSJ: Buffett to start a bond insurer for cities, states (BRK.A)… Citigroup (C), HSBC (HBC) among banks considering selling units. Reuters: Glaxo (GSK) says Advair shows edge over Spiriva in COPD.
00:46 BBI Blockbuster mentioned positively in Weekday Trader - Barron’s Online (3.90 )

Barron’s Online reports those bullish on Blockbuster (BBI) say the co could rediscover its 2004 earnings peak by raising prices for its DVD-by-mail programs, reinstituting some form of late fee and paring back on inefficient advertising expenses. Arvind Bhatia, an analyst with Sterne, Agee & Leach, says the online unit could break even for the first time in 2008. He estimates online sales will grow from 10% of total revenue this year to 11.5% in 2008. Additional announcements could have a positive impact on Blockbuster shares. Ward Davis, managing partner at Trivium Capital Management, believes Blockbuster could be worth more than $12 in two years. Analysts surveyed by Thomson Financial expect BBI to post a loss of 83 cents per share this year, but forecast a per-share profit of five cents in 2008. Over the next 24 months, Davis sees an incremental EBITDA improvement of $245 mln at Blockbuster, thanks to stemming losses in the online program, cost savings via restructuring and a smaller advertising budget. “And that’s really before you get to see Jim Keyes work his retail and merchandise magic on the company,” Davis adds. Additionally, Sterne Agee’s Bhatia sees the potential for a $20 mln to $40 mln EBITDA windfall for Blockbuster in 2008, as former Hollywood Video customers migrate to the nearest Blockbuster.
00:43 WIRES On The Wires

On December 26, 2007, the Directorate-General for Competition of the European Commission has notified LAN Cargo S.A. and LAN Airlines S.A. (LFL) of the initiation of proceedings against 25 cargo airlines, among them LAN Cargo S.A., for allegations of anti-competitive behavior in the air freight business.
00:42 MESA Mesa Air delays release of Q407 results (3.40 )

Co announces that it is delaying the release of its financial and operating results for Q407 until on or about January 15, 2008 and canceling the earnings conference call originally scheduled for Friday, December 28. In its Form 12b-25 filing with the SEC on December 14, 2007, MESA reported that it was delaying the filing of its Form 10-K pending completion of its review of certain estimates and reserves that may affect the financial statements. The co’s review of such estimates and reserves remains ongoing and is not expected to be completed until early next week.
00:39 SLM SLM announces the pricing of its public offering of common stock and mandatory convertible preferred (19.65 )

Co announces the pricing of the public offerings of 101,781,170 shares of its common stock at $19.65 per share and of $1.0 bln aggregate liquidation preference of 7.25% mandatory convertible preferred stock, series C. Each share of mandatory convertible preferred stock, series C, represents a $1,000 liquidation preference and is subject to mandatory conversion on December 15, 2010, into between 41.7188 and 50.8906 shares of SLM common, unless previously converted at the option of the holder. Both offerings are expected to close on December 31, 2007.