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  • Wall Street cheers Home Depot cutbacks. Home Depot (NYSE:HD) is closing 15 underperforming U.S. stores, less than 1% of its portfolio, while reiterating plans to open 55 new stores including 36 in the U.S. in 2009. Home Depot decided to permanently cancel the opening of 50 stores that had been in its pipeline, for which it took a $400M charge, and said it will eliminate 1,300 jobs. HD maintained its full-year EPS forecast of -19% to -24%. Investors cheered the move, sending shares up 3.7%. "Given the slower economic environment, it's probably an appropriate action to cut their expansion and reduce their expenses," a money manager said.
  • Manufacturing, consumer spending, initial claims. The ISM's Factory Index showed U.S. manufacturing was flat in April, surprising economists who had expected a decline. The Commerce Department said consumer spending rose 0.4%, or 0.1% net of inflation. The Labor Department said initial unemployment claims jumped last week to 380,000. "Consumers are struggling," Moody's economist Ryan Sweet says. "Their finances are being squeezed on two fronts: they're getting pressure from higher energy prices and slower income and job growth."
  • Yahoo moves closer to Google while Microsoft readies a hostile bid. Sources say Microsoft (NASDAQ:MSFT) is leaning toward going hostile with its bid for Yahoo (NASDAQ:YHOO), and may make an announcement today. CEO Steve Ballmer has recently signalled a willingness to go as high as $33/share. Meanwhile Yahoo is poised to seal a search-ad pact with Google (NASDAQ:GOOG) within a weak, sources say. The deal will likely be non-exclusive so as to satisfy regulators, seeing as the duo would account for 83% of all U.S. search advertising. The plan involves an open-auction system into which any ad-seller, including Microsoft, could plug their ads.
  • Soaring gas price dampens car sales. Sales at U.S. carmakers were broadly weaker in April from a year ago. Foreign firms fared much better. By manufacturer: Nissan (OTCPK:NSANY): +6.7% to 75,855. Toyota Motor (NYSE:TM): +3.4% to 217,000. Ford (NYSE:F): -12% to 200,007. GM (NYSE:GM): -16% to 257,638. Chrysler: -23% to 147,751. Collectively, the sales indicate an annual total of 14.4M cars, down from 15.1M in March. GM's Michael DiGiovanni said steep oil prices are killing sales, particularly of pickups and SUVs.
  • Sony misses, shares rise. Sony's operating profit more than quintupled to ¥380B, but fell short of its own estimates of ¥410B and Street consensus of ¥394B, according to Tokyo media reports. Shares still climbed 3.1% as shareholders were wary of an even bigger miss.
  • CitiStreet sold to ING. Citigroup (NYSE:C) and State Street (NYSE:STT) agreed to sell jointly-owned CitiStreet for $900M cash to ING Group (NYSE:ING). The deal is expected to close by the end of Q3.
  • Kuwait still likes Citi, Merrill. Kuwait's $250B SWF is considering boosting its $3B and $2B stakes in Citigroup (C) and Merrill Lynch (MER). "The valuation in the markets in the U.S. and Europe, we think, has created a lot of opportunities," the fund's managing director says. Shares in the two were up 4.2% and 5.1% respectively.
  • Miner tie-up on shaky ground. Traders are growing more and more doubtful anything will come of BHP's $162B hostile bid for Rio Tinto (RTP). RTP shares now trade at 7% below BHP's offer price. As investment bankers are wont to quip, "Time wounds all deals."

Earnings: Thursday After Close

  • Automatic Data Processing (NASDAQ:ADP): FQ3 EPS of $0.77 beats consensus of $0.75. Revenue of $2.4B in line. Sees full-year EPS growth of 18-21% and revenue growth of 12-13%. Shares: -1.55%.
  • Bankrate (NYSE:RATE): Q1 EPS of $0.48 beats consensus of $0.45. Revenue of $42.5M vs. consensus of $38.9M. Sees full-year revenue of $116-172M vs. consensus $169M. Shares: -2%.
  • Bebe Stores (NASDAQ:BEBE): FQ3 EPS of $0.10 beats consensus of $0.09. Revenue of $152M vs. consensus of $150M. Sees Q4 EPS of $0.15-0.19, short of consensus of $0.19. Shares: +6.7%%.
  • Cabela's (NYSE:CAB): Q1 EPS of $0.15 beats consensus of $0.05. Revenue of $535.5M vs. consensus of $534.5M. Shares: +9.2%%.
  • Callaway Golf (NYSE:ELY): Q1 EPS of $0.62 beats consensus of $0.60. Revenue of $366.5M vs. consensus $362M. Sees full-year EPS of $1.08-1.18 vs. consensus of $1.12, and revenue of $1.145-1.165B vs. consensus $1.16B. Shares: -0.1%%.
  • Cephalon (NASDAQ:CEPH): Q1 EPS of $1.12 beats consensus of $0.96. Revenue of $434M vs. consensus of $445M. Sees Q2 EPS of $1.10-1.20, better than consensus of $1.06, and revenue of $455-465M in-line. Sees full-year EPS of $5.10-5.20, better than consensus of $4.41. Shares: flat.
  • Chiquita Brands (NYSE:CQB): Q1 EPS of $0.72 beats consensus of $0.41. Revenue of $1.3B vs. consensus of $1.24B. Shares: +4.2%.
  • ComScore (NASDAQ:SCOR): Q1 EPS of $0.18 beats consensus of $0.10. Revenue of $26.4M vs. consensus of $26.1M. Sees Q2 EPS of $0.16-0.17, better than consensus of $0.12, and full-year EPS of $0.75-0.80, better than consensus of $0.50. Shares: +14.9%
  • Chesapeake Energy (NYSE:CHK): Q1 EPS of $1.09 beats consensus of $0.93. Shares: +0.3%%.
  • Cirrus Logic (NASDAQ:CRUS): Q1 EPS of $0.06 beats consensus of $0.05. Revenue of $44.8M vs. consensus $45.65M. Shares: -7.8%.
  • Digital River (NASDAQ:DRIV): Q1 EPS of $0.50 beats consensus of $0.49. Revenue of $104M vs. consensus $99M. Sees Q2 revenue of $91M in-line. Sees full-year EPS of $1.89 in-line, and revenue of $401M vs. consensus $395M. Shares: +2.5%
  • Dolby Laboratories (NYSE:DLB): FQ2 EPS of $0.49 beats consensus of $0.42. Revenue of $173M vs. consensus of $159M. Sees full-year EPS of $1.47-$1.57, better than consensus of $1.46, and revenue of $585-615M vs. consensus of $607M. Shares: +10.7%%.
  • EOG Resources (NYSE:EOG): Q1 EPS of $1.89 beats consensus of $1.65. Revenue of $1.10B vs. consensus of $1.35B. Shares: -0.9%.
  • Fairfax Financial (FFH): Q1 EPS of $33.78 beats consensus of $24.40. Revenue of $2.39B vs. consensus of $1.86B. Shares: +1.7%.
  • Getty Images (GYI): Q1 adjusted EPS of $0.46 misses consensus of $0.46. Revenue of $233M vs. consensus of $219M. Shares: flat.
  • Jones Soda (OTCQB:JSDA): Q1 EPS of -$0.15 misses consensus of -$0.04. Revenue of $9.4M vs. consensus of $9.47M. Shares: -10.1%.
  • LivePerson (NASDAQ:LPSN): Q1 EPS of $0.03 misses consensus of $0.04. Revenue of $17.1M vs. consensus of $17.5M. Shares: -1.2%.
  • MetLife (NYSE:MET): Q1 EPS of $1.52 beats consensus of $1.48. Revenue of $13.03B vs. consensus of $13.99B. Shares: -1.3%.
  • Morningstar (NASDAQ:MORN): Q1 EPS of $0.47 beats consensus of $0.44. Revenue of $125M vs. consensus of $122M. Shares: -0.1%.
  • Monster (NASDAQ:MNST): Q1 EPS of $0.24 beats consensus of $0.22. Revenue of $370M vs. consensus of $363M. Shares: -4.8%.
  • NetSuite (NYSE:N): Q1 EPS of -$0.01 beats consensus of -$0.02. Revenue of $34.1M vs. consensus of $33.7M. Shares: -17.1%.
  • Novatel Wireless (NVTL): Q1 EPS of $0.17 beats consensus of $0.13. Revenue of $91.3M vs. consensus of $90.88M. Sees Q2 EPS of $0.13-$0.16, better than consensus of $0.13, and revenue of $85-90M vs. consensus $98.8M. Shares: -9.2%.
  • QLogic (NASDAQ:QLGC): FQ4 EPS of $0.28 beats consensus of $0.26. Revenue of $160M vs. consensus of $150M. Shares: +1.8%.
  • Sun Microsystems (JAVA): FQ3 EPS of $0.00 misses consensus of $0.18. Revenue of $3.27B vs. consensus of $3.38B. Sun said it will cut up to 2,5000 jobs due to a slowdown in IT spending. Shares: -14.8%.
  • Tessera (NASDAQ:TSRA): Q1 EPS of $0.33 beats consensus of $0.13. Revenue of $59.4M vs. consensus of $56.1M. Shares +0.5%.
  • Websense (NASDAQ:WBSN): Q1 EPS of $0.35 beats consensus of $0.30. Revenue of $86.5M vs. consensus of $84.8M. Sees full-year EPS of $1.15-1.25, short of consensus of $1.23. Shares: +0.1%.
  • Wynn Resorts (NASDAQ:WYNN): Q1 EPS of $0.69 just misses consensus of $0.70. Revenue of $779M vs. consensus of $734.5M. Shares: -4.3%%.

Earnings: Friday Morning

  • BorgWarner (NYSE:BWA): Q1 EPS of $0.75 beats consensus of $0.66. Revenue of $1.5B vs. 1.41B consensus. Sees full-year EPS of $2.85-3.00, better than consensus of $2.85.
  • Chevron (NYSE:CVX): Q1 EPS of $2.48 beats consensus of $2.41. Revenue of $65.95B vs. consensus of $75.64B.
  • Duke Energy (NYSE:DUK): Q1 EPS of $0.37 beats consensus of $0.31 Revenue of $3.33B vs. consensus of $3.25B.
  • Intercontinental Exchange (NYSE:ICE): Q1 EPS of $1.29 beats consensus of $1.27. Revenue of $207M vs. consensus of $205M.
  • iStar Financial (SFI): Q1 EPS of $0.87 in line. Sees Q1 revenue of $422M vs. consensus of $410M. Sees full-year EPS of $3.20-3.60, short of consensus of $3.63.
  • KBR (NYSE:KBR): Q1 EPS of $0.58 beats consensus of $0.34. Revenue of $2.52B vs. $2.3B consensus.
  • Nortel Networks (NT): Q1 EPS of -$0.28 misses consensus of -$0.14. Revenue of $2.76B vs. $2.49B consensus. Gross margin was 41.6%, up from 40.4% last year, but down from 43.7% last quarter. Nortel sees full-year revenue growth in the low single-digits.
  • Viacom (NASDAQ:VIA): Q1 EPS of $0.42 just beats consensus of $0.41. Revenue of $3.12B vs. $2.97B consensus. Sees low-double-digit EPS growth from 2008-2010.
  • Washington Post (WPO): Q1 EPS of $5.68 misses consensus of $6.58. Revenue of $1.06B in-line.
  • Weyerhaeuser (NYSE:WY): Q1 EPS of -$0.24 misses consensus of -$0.17. Revenue of $3.39B vs. consensus of $3.63B.

Today's Markets

  • Market climbed in Asia Friday. Nikkei +2.05% to 14,049. Hang Seng +1.89% to 26,241. Shanghai +4.82% to 3,693. BSE Sensex +1.81% to 17,600.
  • In Europe, markets are broadly higher at midday. FTSE +0.89%. CAC +0.93%. DAX +1.05%.
  • U.S. futures are up slightly at 2:25. Dow +0.11% to 13,015. S&P +0.11% to 1,413. Nasdaq +0.1% to 1,985. Expect some movement at 8:30 EDT when the non-farms payroll number comes out.
  • Oil futures are up 0.47% to $113. Gold is up 0.36% to $854.

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