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From Briefing.com: 4:11PM Therma-Wave receives going concern opinion (TWAV) :Co announces that its independent registered public accounting firm included a going concern explanatory paragraph in its report on TWAV's consolidated financial statements as of and for the fiscal year ended April 3, 2005. The qualification was included as a result of the co's recurring net losses and negative cash flow.

Close Dow +68.36 at 10371.80, S&P +10.55 at 1204.99, Nasdaq +21.38 at 2078.75: Despite another surge in oil prices and a lack of support from bonds, stocks closed near session highs as strong factory orders and an upbeat outlook from Wal-Mart reiterated economic growth, helping every economic sector close to the upside... Just after the market opened, the Commerce Dept. reported a third consecutive monthly increase in factory orders (due largely to a surge in aircraft orders), as May orders rose 2.9% (consensus 3.0%)...
Even though April's increase of 0.9% was downwardly revised to 0.7% and the data are rather predictable given the known surge in commercial aircraft bookings, the largest orders increase (May) in 14 months provided some reassurance that June orders could also be strong and that the second half of 2005 may be even better than the first half... Also helping to offset early weakness, and providing some direction to a market with little in the way of anything earnings-related heading into earnings season, was Wal-Mart's (WMT 49.80 +1.52) raised forecast for June comps growth of 4.5% (from 2-4%)...

Wal-Mart's report, coupled with Walgreen's (WAG 46.70 +0.62) strong same-store sales gain of 7.8% for June, provided further evidence that, even in the face of higher gasoline prices, consumer spending remains on track to support real GDP growth of 3.0% or better... Anticipation of new fund inflows, especially since the first trading day of the month/quarter fell on a Friday prior to a holiday weekend, perhaps also acted as a contributing factor behind today's broad-based advance... Meanwhile, Energy paced the way higher for the second straight session, as oil prices hit the psychological $60/bbl level for the first time in over a week...

Crude oil futures ($59.59/bbl +$0.84) surged 1.4% amid concerns that Tropical Storm Cindy, which prompted the evacuation of several oil platforms in the Gulf of Mexico, could make landfall as early as this evening and further disrupt crude supplies... Despite another sell-off in the Treasury market that closed benchmark yields near session highs, subsequently increasing borrowing costs for both consumers and corporations, a strong performance from the Financial sector provided some leadership...

American International Group (AIG 59.58 +0.97) surged after hiring former SEC Chairman Arthur Levitt as a board advisor while a Merrill Lynch upgrade on Morgan Stanley (MWD 53.79 +0.76) also helped the sector shrug off rising bond yields... The benchmark 10-year note closed down 17 ticks to yield 4.10%, as strong factory orders reinforced the economy's ability to endure rising interest rates... Reports out of Prudential that recommended investors with the appropriate risk tolerance get out of bonds altogether - allocating 100% of their portfolio to equities versus a benchmark 60/40 stock-bond split - may have also incited some selling interest in bonds...

Technology was strong across the board, led by broad-based gains in semiconductor and a 4.1% surge in Apple Computer (AAPL 37.98 +1.48) after First Albany raised its Q3 EPS and sales estimates... Health Care got a boost from Boston Scientific (BSX 28.60 +1.71), which received a favorable court ruling on its Ding patents, while Bausch & Lomb (BOL 87.50 +5.72) hit a historic high after agreeing to buy a controlling 70% stake in China's Shandong Chia Tai Freda Pharmaceutical Group for $200 mln in cash...

Consumer Discretionary traded higher, benefiting from a 2.0% surge in the retail group ahead of Thursday's same-store sales reports, strength in General Motors (GM 34.80 +0.15), which extended its "Employee Discount" marketing program to August 1st, and resilience in homebuilding... Homebuilders were initially under pressure after CSFB downgraded KBH, MDC and RYL... Telecom Services also put together a solid advance following reports that Deutsche Telekom may sell its T-Mobile USA wireless unit... Despite some profit-taking in several transportation stocks (i.e. UPS, BNI, NSC, LUV and DAL), spurred in part by rising oil prices, the Industrials sector also traded higher...DJTA +0.8, DOT +0.7, Nasdaq 100 +1.1, Russell 2000 +1.6, SOX +1.6, S&P Midcap 400 +1.0, XOI +2.3, NYSE Adv/Dec 2149/1153, Nasdaq Adv/Dec 2061/1015

11:40AM Alliance Semi announces formation of special committee to evaluate and respond to stockholder (ALSC) 2.62 +0.02:Co announces that its Board of Directors has formed a special committee of directors to evaluate and make decisions in response to the share accumulation and proposals recently disclosed in a Schedule 13-D filing made by Bryant R. Riley and his affiliates. The committee has only just begun its work and has not yet established a timetable for completion of its review of the situation.

9:05AM Lucent awarded PHS network contracts; also to increase capacity for Verizon Dominicana (LU) 2.94 :Co announces it has been awarded PHS network expansion contracts by Gansu Telecom and Shandong Netcom, provincial subsidiaries of China Telecom and China Netcom respectively. These will expand the capacity and coverage of their networks substantially, and introduce a variety of next-generation services.... Co also announces that it and Verizon Dominicana have increased the capacity of the operator's 3G CDMA2000 network in the Dominican Republic to support one million subscribers within a single mobile switching center.

Hardware stocks should be in focus after First Albany raised Q3 EPS and sales estimates for Apple Computer (AAPL), JP Morgan raised Q2 EPS forecasts on IBM (to $1.00 from $0.94), Gateway (GTW) wins its largest ever government deal and Lexmark (LXK) was downgraded to Underperform at Thomas Weisel...

8:53AM Tech Focus :Former Computer Associates (CA) CEO Sanjay Kumar accused in indictment of paying $3.7 mln bribe to employee who threatened to reveal cos' accounting practices... Oracle (ORCL) says it expects total restructuring costs of $546 mln related to its pre-merger operations with PeopleSoft, down from its previous estimate of $611 mln... Microsoft's (MSFT) Gates says implantable computers may one day allow blind to see, deaf to hear... EDS (EDS) proposed settlement of $16.5 mln to end suit brought by employees and retires for fiduciary duties breach rejected by U.S. district judge... Sanyo to take charge, cut about 15% of its work force, or 14,000 people... IBM (IBM) says it's signed up dozens of companies to develop plan to keep data safe from hackers... Google (GOOG), Yahoo (YHOO), others start offering advertising options for really simple syndication, or RSS feeds that automatically send info from the Web... Founder of pen computing company Go files antitrust suit vs. Microsoft... Hewlett-Packard (HPQ), IBM, Gateway (GTW) included in winners of $116 mln in new contracts awarded by state of Calif.

O2Micro (OIIM) gets U.K. patent for power switch device...

3:50PM CMGI (CMGI) 1.90 +0.01: The dot com era was arguably one of the most dynamic growth periods in history. It was characterized by rapid technological evolution and wide-spread embrace of the Internet. It was during this period that CMGI, a leading technology incubator and venture capital firm, made its mark on the technology community. The company was responsible for some of the most compelling growth stories of the period, including Lycos, GeoCities, eGroups, Vicinity, and Critical Path. However, following the bursting of the Internet bubble, the once regarded company lost its prominence.

Far from its heyday, where shares traded above $160 and market capitalization approached $30 billion, the Waltham, Massachussetts-based company has been operating in obscurity. Today the company trades below $2/share and is principally focused on providing technology solutions that help businesses market, sell, and distribute their products and services. The venture capital business has lost much of its luster and no longer remains at the center of the business model.

On account of the acquisition of ModusMedia, a leading supply chain solutions provider, in August 2004, the company has established a legitimate revenue stream. The company reported sales of $265.7 million in fiscal third quarter, reflecting a 151% increase over the same period last year. Additionally, operating loss improved to $1.9 million for Q3, compared to a loss of $6.5 million in the year ago period. The strong sales increase and decline in operating loss year/year was largely due to the recent acquisition and the realization of synergies and associated cost benefits. Net income, however, declined 72% to $19.6 million, due to lower tax benefits, and Non-GAAP operating income improved 332% to $4.4 million.

As the integration of ModusMedia extends its reach in the supply-chain business, CMGI is on its way to becoming a legitimate dot-com survivor. The deal not only provides a more stable source of revenues, but also broadens the company's product and service offerings. As the synergies continue to emerge, the benefits going forward should be reflected in a stronger revenue base and improved profitability.

Looking beyond the notable collapse of the company, and the technology sector, CMGI still has a market cap near $1 billion and a substantial operating business. While investors should be mindful of the latent risks and excessive volatility associated with the stock, the company warrants a closer look as strategic efforts and restructuring initiatives continue to unfold. ---Richard Jahnke, Briefing.com
3:45PM CMGI (CMGI) 1.90 +0.01: The dot com era was arguably one of the most dynamic growth periods in history. It was characterized by rapid technological evolution and wide-spread embrace of the Internet. It was during this period that CMGI, a leading technology incubator and venture capital firm, made its mark on the technology community. The company was responsible for some of the most compelling growth stories of the period, including Lycos, GeoCities, eGroups, Vicinity, and Critical Path. However, following the bursting of the Internet bubble, the once regarded company lost its prominence.

Far from its heyday, where shares traded above $160 and market capitalization approached $30 billion, the Waltham, Massachussetts-based company has been operating in obscurity. Today the company trades below $2/share and is principally focused on providing technology solutions that help businesses market, sell, and distribute their products and services. The venture capital business has lost much of its luster and no longer remains at the center of the business model.

On account of the acquisition of ModusMedia, a leading supply chain solutions provider, in August 2004, the company has established a legitimate revenue stream. The company reported sales of $265.7 million in fiscal third quarter, reflecting a 151% increase over the same period last year. Additionally, operating loss improved to $1.9 million for Q3, compared to a loss of $6.5 million in the year ago period. The strong sales increase and decline in operating loss year/year was largely due to the recent acquisition and the realization of synergies and associated cost benefits. Net income, however, declined 72% to $19.6 million, due to lower tax benefits, and Non-GAAP operating income improved 332% to $4.4 million.

As the integration of ModusMedia extends its reach in the supply-chain business, CMGI is on its way to becoming a legitimate dot-com survivor. The deal not only provides a more stable source of revenues, but also broadens the company's product and service offerings. As the synergies continue to emerge, the benefits going forward should be reflected in a stronger revenue base and improved profitability.

Looking beyond the notable collapse of the company, and the technology sector, CMGI still has a market cap near $1 billion and a substantial operating business. While investors should be mindful of the latent risks and excessive volatility associated with the stock, the company warrants a closer look as strategic efforts and restructuring initiatives continue to unfold. ---Richard Jahnke, Briefing.com

12:47PM Wynn Resorts (WYNN) 49.06 +1.00: The dice have been hot in Las Vegas and are unlikely to cool anytime soon. According to the Global Entertainment and Media Outlook Study released by PricewaterhouseCoopers, casino gambling revenues in the United States are expected to climb to $64.1 billion in 2009 from the $47.3 billion generated last year. With an improving economy and growing demand/interest in gambling, new casinos and hotel expansions have reshaped the Las Vegas Strip and the outlook for gaming operators.

Concurrent with the explosive growth in the market, Wynn Resorts unveiled the Wynn Las Vegas in late April and is proceeding with the Encore project on the Las Vegas strip, a mega-resort located adjacent to the Wynn Las Vegas. The project is slated to be complete by the end of 2008. Additionally, with casino gaming revenues in Asia projected to grow at 15.9%, impressario Stephen A. Wynn has increased his focus on operations in Macau and Singapore.

The gleaming new Wynn Las Vegas resort made its debut in late April to much acclaim, and has since proved to be a real "Wynn". The $2.7 billion luxury show piece has already exceeded expectations. Net gaming revenues for the first 34 days of operations were $64.3 million. Slot machines produced total net revenues of $20.2 million, with a win per machine of $304 a day, while table games generated net revenues of $42.7 million, or $9,244/table per day.

For the first full-month of operations, gross non-gaming revenues for Wynn Las Vegas were roughly $77 million, which was on par with expectations for the first 60 days of operations. The average daily room rate at the resort was $308, with average occupancy at 91%. Other services such as hotel rooms, entertainment, food, and retail shops, have been a significant contributor to the bottom line, and often generates more revenue than gambling.

The current results for the resort have undoubtedly been encouraging, however, given the large crowds that visited the property initially, the results are not absolutely telling going forward. Performance measures are likely to normalize as the company's operations progress. Additionally, risks for the company, as well as other casinos, include a decline in visitations to Las Vegas, especially for those firms that have a significant portion of their revenues coming from the strip, and construction delays and budget concerns.

As the Las Vegas strip continues to heat up and consumers look for greater attractions and services, Wynn Resorts remains well positioned for growth. Although shares have been slightly depressed lately, following a significant run-up since going public just over two years ago, the potential for continued out-performance remains favorable. ---Richard Jahnke, Briefing.com

12:17PM Wal-Mart (WMT) 49.66 +1.38: Shares in the world's largest retailer have remained under pressure over the last twelve months. The stock has significantly under performed the broader market down almost 9% year-to-date as many issues has restrained performance from high gas prices to operational issues. But today, WMT shareholders are finally receiving a respite after the company raised its June sales expectations, coupled with a ratings upgrade.

For the first time in several months, Wal-Mart raised its June sales estimates saying it expects same-store sales to exceed expectations. It now sees June same-store sales to rise 4.5% vs. its previous guidance of 2-4% growth. This would be WMT's strongest sales month since the beginning of the year. For some perspective on recent sales trends here are WMT's results over the past few months: May's comps rose 2.5%, April +0.9%, March +4.3%, February +4.1%, and January rose 2.5%.

Looking ahead, the retailer is facing increasingly easy comparisons as the year unfolds. This fact could support shares in the near-term. For those not familiar with how these numbers work, same-store sales or comps are comprised of revenue growth at stores opened at least one year. The numbers are compared to the corresponding period from the prior year. Retail stocks tend to trade on these monthly results. Getting back to Wal-Mart, the fact is the company faces a relatively easy calendar ahead with last year's comps as follows: June same-store sales rose 2.2%, July +3.2%, August +0.5%, Sept +2.4%, October +2.8%, and November +0.7%.

The surge in share today was punctuated by Oppenheimer raising its rating to Buy from Neutral. The firm cited strong sales results in June saying these numbers may provide a near-term support level for the stock. However, the rating change is more a trading call than an investment one. The firm believes that a near-term rally could extend over the next few months due to the above mentioned forward comps. It also expects the retailer to correct its merchandising and operating methods with new leaders in the US encouraging more innovation. Oppenheimer thinks WMT's shares should rally back to $55 with shares possibly reaching a high of about $70.

The market reacted to the upgrade and the sales guidance sending shares up a dollar fifty in early trading. Wal-Mart is scheduled to release its earnings results for the second quarter on August 11th. The Bentonville-based company manages the market's expectations quite well. As such, due to well telegraphed earnings historically WMT tends to come within consensus estimates by a penny. Last quarter it actually missed expectations something it has not done in many years. The quarter was quite challenging as gas price had risen dramatically and the company suffered from poor weather trends, along with an early Easter. Wal-Mart stated last quarter it would continue to improve its product selection and depth and expects momentum to pick up in the second half of the year. Gasoline prices, however, will continue to remain a dark cloud over the company impacting sales and gross margins.

Wal-Mart continues to aggressively move into international markets targeting 30% of sales achieved outside the US. Today, its UK grocery chain Asda announced plans to eliminate 1,400 jobs and speed up price discounts to close the gap with the market leader Tesco. In addition, the Japanese newspaper Nihon Keizai reported WMT will raise its stake to 50% from 42.4% in Seiyu Ltd - the fourth largest retailer in the country.

Reuters estimates is $0.65 per share for the second quarter and $0.61 for the third quarter. For the full year, consensus is currently at $2.66 per share representing an 11% year/year growth rate. For FY07, the Reuters consensus estimate is $3.04. The stock is trading at 20.1x current earnings, right in-line with the S&P 500 at 19.7x. On a forward basis, shares are trading at 18.6x compared to its 5-year historical average of 30.9x. We continue to feel the downside is limited as Wal-Mart's challenges have already been priced into shares leaving more room to the upside for the near-term. ----Kimberly DuBord, Briefing.com

8:32AM Page One: Stock futures indicate a lower open. Slightly higher oil prices are about the only major news item to account for the move.

Oil prices are up about $0.50 to a little over $59 a barrel. Oil spiked on Friday on light volume on concerns about high demand for gasoline over the holiday weekend.

There is very little other news. There are no economic releases and no earnings reports. There are no merger announcements. Wal-Mart (WMT) raised it forecast for June same store sales to 4.5% from a previous 2% to 4%. Walgreen reported a strong same store sales gain of 7.8% for June. Those are both good indicators that consumer spending remains on track to support 3% plus real GDP growth.

The lack of news leads us to mention several positive analyst comments. Oppenheimer raised its rating on Wal-Mart to a "buy". Bear Stearns upgraded Deere to an "outperform". Legg Mason raised Amazon.com to a "buy" with a $42 price target.

JP Morgan raised their second quarter earnings estimate for IBM to $1.00 per share from a previous $0.94. First Albany raised their forecast for Apple computer June quarter profits to $0.34 per share from a previous $0.29.

What little news there is is positive. Yet, futures suggest a lower open. Blame oil and possibly some overhang from the Fed policy statement last week.

The market remains stuck in its trading range. As this morning's Big Picture column points out, however, earnings have continued to grow over the past six months. Higher earnings and a flat market mean a lower price/earnings multiple. And that may mean a rally some time in the second half of this year. Dick Green, Briefing.com

9:44AM Jabil Circuit (JBL) Prudential initiates OVERWEIGHT. Target $37. Firm believes the co has good visibility on growth opportunities and could have more opportunities than are currently forecasted. They believe the co lost some Lucent business, with Solectron (SLR) and Celestica (CLS) as the 2 remaining suppliers for Lucent. Also, they note Philips pre-announced its June qtr due to weakness in its consumer business. Despite these key customer issues, they note the co reported its May ending qtr inline/ahead of guidance and also provided 2H05 guidance ahead of expectations. They note that for lost businesses, the co has been able to answer with higher than anticipated guidance from the consumer and medical/instrumentation segments.
9:44AM Gardner Denver (GDI) KeyBanc Capital Mkts / McDonald downgrades Aggressive Buy to BUY. Target $48 to $43. KeyBanc downgrades GDI following the co's initial dilution guidance related to its acquisition of Thomas Industries. Firm says the dilutive impact in 2005 is notably higher than their forecast and than the co's initial guidance. However, firm continues to recommend the co's shares on the basis of strong base business earnings momentum and contributions from previously announced acquisitions.

9:43AM Wal-Mart (WMT) Oppenheimer upgrades Neutral to BUY. Oppenheimer upgrades WMT saying a sales surprise for June appears to have set a floor under WMT shares, and to have provided a basis for a trading rally. Firm believes the rally may extend over the next several months as WMT faces easy sales comparisons and corrects its merchandising and operating methods. Firm says new leaders at US Wal-Mart are now encouraging innovation, and thinks WMT shares should rally back to $55, the mid-point of its range since Dec 1999. They think ustained improvement, coupled with EPS growth, might extend the rally to the high of the range at about $70.

9:42AM Apt Inv & Mgt (AIV) Lehman Brothers downgrades Equal-weight to UNDERWEIGHT . Firm believes that the apartment sector continues to look expensive, and says that AIV remains challenged to improve its operating performance in still difficult markets. Also, firm says the dividend is not covered by operating cash flow and could be at risk of being cut.

9:40AM ADESA (KAR) Sun Trust Rbsn Humphrey upgrades Neutral to BUY. Firm thinks the co should show meaningful sequential improvement for 2Q in the YoY change in vehicles sold, and expects that would be a psychological positive for the stock. More importantly, they think the secular back-drop for used vehicle auctions could remain favorable for a number of years, as the lease penetration for new car sales should continue to lift with rising interest rates that make ownership less affordable.

9:40AM Transmontaigne Partners (TLP) UBS initiates NEUTRAL. Target $26. Smith Barney initiates TLP based on their view that although the partnership's units are fully valued, they offer investors a relatively attractive yield. AG Edwards initiates TLP with a Buy and $30 tgt, saying underlying internal growth should be attractive relative to other midstream/pipeline M.L.P.s due to favorable trends in fueling the Florida based cruise ship industry and above average population growth in Florida, southwestern Missouri and northwestern Arkansas. Firm also cites that an attractive 6.2% current yield is above the peer group current average of 6.0% and TLP's distributions are 80% tax deferred.

9:36AM Dyax (DYAX) Pacific Growth Equities upgrades Equal Weight to OVER WEIGHT. Pacific Growth upgrades DYAX saying they have become more confident that the co is poised to potentially complete the Phase III study around mid/3Q06, leading to a potential B.L.A. filing in H.A.E. in 4Q06 and approval mid/3Q07. Firm anticipate Dyax will complete several important milestones over the coming 12-18 months including completion of the Phase III study and B.L.A. filing for SQ DX-88 in H.A.E., establishment of partnerships for DX-88 in the C.A.B.G. setting and for DX-890 in C.O.P.D./alpha-1 anti-trypsin deficiency, and at least one I.N.D. filing. They believe the stock to be undervalued and would anticipate progress in the milestones noted above to lead to appreciation of the Stock.

9:35AM Starbucks (SBUX) WR Hambrecht upgrades Hold to BUY. Target $54 to $53. WR Hambrecht upgrades SBUX as they believe SBUX is the highest quality growth stock in the restaurant industry, representing a core long-term growth investment, at an attractive entry point. Firm says the co still sells a high margin, habitual product, but now faces less competition than it did five years ago.

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