• Global stocks are mostly higher with the European DJ Stoxx 50 Index up +0.37% at a 1-1/2 month high and June S&Ps up +2.60 points at a 17-1/4 month high. The dollar slumped to a 3-week low which has boosted most commodities, while the euro jumped to a 3-week high against the dollar after the Kurier newspaper reported that the European Union will offer Greece a 55 billion-euro ($75 billion) bailout. The Vienna-based newpaper said Germany will contribute as much as 20 billion euros and France may provide 10 billion euros. Also boosting European stocks is the larger-than-expected increase in Jan Euro-Zone industrial production, which rose +1.7% m/m, its biggest gain in more than two decades, which signals the recovery may be strengthening. European financial stocks and commodity producers are leading today's rally with gains in homebuilders also adding strength after UK home prices increased at the fastest pace in more than 7 years. Slightly denting the bullish euphoria is the 2.3% slump in Carrefour SA after Europe's biggest retailer was cut to "underperform" from "neutral" at Credit Suisse Group AG.

• The Asian markets today closed mixed with Japan up +0.81%, Hong Kong -0.09%, China -1.33%, Taiwan -0.02%, Australia +0.08%, Singapore +0.26%, South Korea +0.27%, India -0.01%. Japanese stocks closed at a 1-1/2 month high after two BOJ officials, speaking on condition of anonymity, said the BOJ at its policy meeting next week may seek to expand a 10 trillion yen ($110 billion) fund that provides loans to banks. The yen weakened, which boosted Japanese exporters, after Japanese Prime Minister Hatoyama said the government must take "firm measures" to keep the rising yen from hurting the economy. Asian health-care companies surged on speculation that proposed changes to the US health system will be harder to pass, while Singapore stocks gained after Indonesia's sovereign debt rating was raised by Standard & Poor's to BB from BB-, its highest level in 12 years, after the central bank increased the country's economic growth forecasts this week. Feb India industrial production rose +16.7% y/y on the heels of December's +17.6% y/y record gain, further diminishing spare capacity that may contribute to inflationary pressures and prompt India's central bank to raise interest rates. India's government bond yields jumped to a 17-month high after central bank Deputy Governor Gokarn said India's inflation rate could surge to "double digits."

• June S&Ps this morning are trading up +2.60 points at a new 17-1/4 month high. The US stock market yesterday traded in negative territory most of the day until a late surge left it closing higher (Dow Jones +0.42%, S&P 500 +0.40%, Nasdaq Composite +0.40%). The S&P 500 rose to a 7-week high and the Nasdaq moved up to a 1-1/2 year high. Bullish factors for stocks included (1) a -6,000 decline in weekly initial unemployment claims, (2) Fed data that showed US household net worth in Q4 gained $700 billion to $54.2 trillion, the third straight quarterly increase, which may lead to an increase in consumer confidence and spending, (3) strength in technology sticks on the recommendation of Key Private Bank for investors to "maintain a fairly aggressive exposure to technology relative to other sectors as technology will be again one of the leadership areas of the market," and (4) gains in health-care stocks on optimism that any kind of meaningful health-care reform looks increasingly unlikely to pass Congress.

• Bearish factors for stocks included (1) concerns that global economic growth will slow on speculation that China may be forced to raise interest rates after Feb China consumer prices rose at their fastest pace in 16 months, (2) the unexpected narrowing of the Jan US trade deficit to -$37.3 billion (versus expectations of -$41.0 billion) which may indicate a slowing economy as exports declined for the first time since April, (3) concerns that US consumer spending may remain constrained which may threaten the sustainability of the economic recovery after Fed data showed that for all of 2009 US consumer borrowing decreased -1.7%, the first decline since records began in 1952, and (4) the prediction from HSBC Holdings Plc that global financial markets have yet to bottom along with its recommendation for investors to increase their cash holdings to ride out a coming "general correction."

• National Semiconductor (NSM) gained 3.2% in pre-market trading after the company forecast Q4 sales of at least $375 million, higher than analysts' estimates of $359.9 million.

• June 10-year T-notes this morning are trading down -3.5 ticks. T-note prices yesterday traded in negative territory throughout the session and settled down -3 ticks at a 2-week low of 116-250. The 10-year T-note yield rose to a 2-week high of 3.747%. Bearish factors yesterday included (1) supply pressures after the Treasury auctioned $74 billion of T-notes and T-bonds over the past three days, and (2) weak foreign demand for the Treasury's $13 billion 30-year T-bond auction after indirect bidders, an investor class that includes foreign central banks, bought only 23.9% of the bonds, well below the 41.5% average of the last 10 auctions. Bullish factors included (1) the unexpected increase in weekly US continuing unemployment claims of +37,000 to 4.558 million versus expectations of -2,000 to 4.498 million, (2) the prediction from the chief economist at Wells Fargo that US unemployment claims are still too high to indicate a stronger job market and that they need to fall to about 400,000 to 420,000 to signal a sustained improvement in the labor market, and (3) the 6% y/y increase in Feb US foreclosure filings to 308,524, the 12th consecutive month that filings topped 300,000, and the 50th straight month that foreclosure filings increased on an annual basis, which shows the US housing crisis has yet to bottom.

• The dollar index this morning is trading lower at a 3-week low with the dollar/yen -0.05 yen and the euro/dollar +0.88 cents. Reports this morning of a bailout for Greece along with currency intervention talk from Japan has undercut the dollar. The dollar index yesterday traded mixed most of the day and finished slightly lower. Bearish factors yesterday included (1) comments from French President Sarkozy who said he's not in favor of a weak euro, and (2) concerns that US consumer spending may remain constrained and threaten the sustainability of the economic recovery after Fed data showed that for all of 2009 US consumer borrowing decreased -1.7%, the first decline since records began in 1952. Bullish factors included (1) the unexpected narrowing of the Jan US trade balance, (2) the statement from Standard & Poor's that the dollar will retain its status as the world's reserve currency as long as US financial markets are sound and government spending is sustainable, and (3) Morgan Stanley's action to cut its 2010 Euro-Zone GDP forecast to 0.9% from 1.2%, citing weak job and credit growth.

• April crude oil prices this morning are up +52 cents and Apr gasoline is +1.25 cents. Apr crude oil yesterday fluctuated on either side of unchanged before finally closing up +$0.02 per barrel. Apr gasoline closed down -1.31 cents per gallon. Bearish factors included (1) the unexpected narrowing of the US Jan US trade deficit, which signals a slowing economy and weakened energy demand, (2) the drop in Jan US crude imports to 245 million bbl, the least amount of crude imports since Feb 1999 and a sign of slack energy demand, and (3) the prediction from tanker-tracker Oil Movements that OPEC will ship 23.2 million barrels of crude a day in the four weeks to Mar 27, up +0.9% from the prior week. Bullish factors included (1) the weaker dollar, and (2) the action by China to increase its crude processing rate to a record 8.35 million bpd in Feb, a sign of strong fuel demand in the world's second-biggest energy user.

Earnings reports (confirmed releases, sorted by mkt cap) ANN-Ann Taylor Stores (BEST earnings consensus (-$0.01), HIBB-Hibbett Sports (0.31), IRET-Investors Real Estate (0.01), HALO-Halozyme Therapeutics (-0.17), BWEN-Broadwind Energy (-0.04), FIZZ-National Beverage (0.10), PEI-Pennsylvania Real Estate Investment Trust (-0.02).

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