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From Briefing.com: Close Dow +59.79 at 10883.51, S&P +5.31 at 1272.74, Nasdaq -2.41 at 2262.59: The bullish cue that traders took yesterday from the Fed's modified policy statement extended into today's session. A dose of upbeat corporate news underpinned that sentiment, and kept the blue chip averages comfortably ahead of the flat line. At the same time, relative weakness in the Technology sector stunted the Nasdaq and left it vacillating in and out of the red. Gains were lent by eight of ten economic sectors; rising despite crude's 1% drop, the Energy sector (+1.1%) led. A mixed inventory report from the EIA, which included an unexpected drawdown in distillate (i.e., heating oil) supply, catalyzed some choppy crude trading. But crude inventory unexpectedly rose, and the eventually-sustained downturn in crude futures paired with running Nike (NKE 91.48 +3.56) shares in sending the Discretionary sector 0.5% higher. Utilities enjoyed broad-based buying, but Constellation Energy (CEG 61.13+4.86) provided a particular boost following reports that the parent of Florida Power and Light (FPL 42.98 +0.11) is considering an $11 billion buyout. Driven by a trio of Dow components, the Industrials sector (+0.5%) stood strong. Specifically, Boeing (BA 71.43 +0.84) trumped rival Airbus and won a large contract from Australia's Quantas Airways; in his optimistic annual state-of-the-company address to investors, General Electric (GE 35.75+0.28) CEO J. Immelt reaffirmed FY06 EPS growth expectations of 12-17%; and Honeywell (HON 37.49 +1.61) forecasted 20-30% EPS growth for its fiscal 2006. News from the Industrial bellwethers reflects the Overweight rating Briefing.com maintains on the sector, and lent muscle to the broader market's advance. Separately, defense contractor General Dynamics (GD 111.80 -0.29) agreed to purchase Anteon International (ANT 54.03 +13.26) for about $2.2 billion. The influential Financial sector's (+0.4%) afternoon advance effectively uncapped the blue chip indices and allowed them to climb higher. Rate-sensitive banks were a pocket of relative strength, mirroring the market's hope that the Fed is nearing the end of its current monetary tightening cycle. Action within the Treasury market further evidenced that optimism. Traders pushed the 10-year note up 19 ticks and down to a session-long 4.44% yield - the benchmark bond's best level of the month. Treasury Secretary Snow's early statement that "inflation is in well in check" lent further credence to participants' speculation that the Fed's rate hikes may soon pause. At the same time, ambiguity over the statement's language and a realization that it's ultimately the data that will determine the Fed's course of action may have tempered buying efforts. In particular, the market awaits tomorrow's closely-watched and inflation-gauging CPI report. Of the three declining sectors, Technology had the most influential effect. Plunging Apple (AAPL 72.01 -2.97) shares, a result of two analysts' downgrades, plagued the sector. Both Bear Stearns and Bank of America cited valuation concerns for their rating reduction; as a side note, the latter firm pointed out that the stock has jumped 50% over the past six weeks - a reason for which it hesitates to suggest the commitment of new money. Downgraded Electronic Arts (ERTS 53.74 -1.40) served as a secondary sore spot, but relative strength in Symantec (SYMC 17.75 +0.40), which received a new antivirus technology patent, offered some offsetting upside. Separately, October's trade deficit widened to a worse than expected record $68.9 billion. Overall, though, neither the stock nor bond markets paid much attention. NYSE Adv/Dec 2014/1294, Nasdaq Adv/Dec 1482/1558

9:22AM NeoMagic announces financing (NMGC) 7.75 :Co announces a $9.0 mln private placement pursuant to which it will issue 1.5 mln shares of common stock and warrants to purchase 750,000 shares of common stock at an exercise price of $9.00 per share. The five-year warrants will not be exercisable for the first six months and will include anti-dilution provisions that would have the effect of lowering the applicable exercise price if the co issues equity at prices below the exercise price. The co intends to use the net proceeds from these financing transactions for working capital and general corporate purposes.

8:45AM Mattson wins order from chipmaker (MTSN) 9.78 :Co wins follow-on order for its Aspen III ICPHT from "leading flash memory manufacturer", financial terms not disclosed.

8:42AM Suntech Power IPO prices at high end of range; solar energy cell maker (STP) 15.00 :Suntech Power prices its IPO at $15, at the high end of the expected range of $13-15, which had been raised from $11-13. Based in China, the co makes silicon chips that can be used to convert solar energy into electricity. The co is one of the world's top 10 manufacturers of photovoltaic, or PV, cells based on production output. Its products are used to provide electric power for residential, commercial, industrial and public utility applications. The co has developed advanced process to manufacture PV cells cost-effectively and on a large scale with high conversion efficiencies. The co's average conversion efficiency rates of its monocrystalline and multicrystalline silicon PV cells reached reached 16.5% and 15.0%, respectively, vs average ranges of 12-17% and 11-16%. The co has increased its manufacturing capacity by 12 times in less than 3 yrs and the co plans to double capacity by the end of 2006. For the 9 mos ended Sep 30, the co reported revs of $137 mln, up 187.6% yr/yr. Also, the co's margins are impressive with a net margin of 14.7%.... It's a good time to be a solar IPO as the group has been hot. SunPower (SPWR 27.83) is up 55% from its $18 offering price on Nov 17. Also, Evergreen Solar (ESLR) has been breaking out to new highs and has doubled since mid-Aug. This is a 26.4 mln share deal, led by CSFB and Morgan Stanley. SG Cowen is a co-manager.

11:09 am Six Flags (PKS)

7.06 -0.09: On August 25th, Six Flags said its Board of Directors unanimously decided to seek proposals from third parties for a possible sale of the company, intending to pursue a "prompt and orderly" auction process. Red Zone LLC, an investment firm managed and controlled by Washington Redskins owner Daniel Snyder, which owns 12% of PKS, was invited to participate in the process. Another potential bidder was Cedar Fair (FUN), which owns 7 theme parks, while Walt Disney (DIS) -- the world's largest amusement park operator and suggested holding in Briefing.com's portfolio for active investors -- was also rumored to be an interested party.

However, since no formal bids were placed and the deadline for offers expired Monday, Six Flags took itself off the auction block. Prompt and orderly, though, can be used to describe the ensuing appointment of a new CEO. Completing a four-month struggle to force out CEO Kieran Burke, former ESPN executive (and recent Red Zone CEO) Mark Shapiro was named Six Flags president and chief executive, effective immediately. Shapiro, who plans to better leverage the media value of PKS, said the company's board will be expanded from seven directors to 10 members in order to make room for former congressman Jack Kemp, movie producer Harvey Weinstein, and media consultant Michael Kassan.

Shares of Six Flags, which took its name from the six countries whose flags have flown over Texas throughout the state's extraordinary history, have soared 92% after bottoming out in mid May and are up 33% year to date as of yesterday's close. Snyder's months-long proxy fight and the seasonal trade effect (parks open in April and close in October) accounted for most of the stock's appreciation. Whether or not the roller coaster ride is over, though, remains to be seen as neither Shapiro nor Snyder have any prior experience actually running theme parks. Six Flags has 29 locations across the country that drew more than 44 mln visitors last year.

--Brian Duhn, Briefing.com

11:02 am Honeywell (HON)

37.67 +1.79: Share of Dow component Honeywell International rose sharply on Wednesday, gaining nearly 5%, after the company forecasted 9% sales growth and EPS growth of 20% to 30% for fiscal 2006. In addition, Honeywell, a $30 billion diversified technology and manufacturing company, reaffirmed its current year guidance.

For 2005, the company continues to see sales of about $27.6 billion and earnings of $2.11 to $2.13 per share, excluding a tax charge for repatriated income. According to Reuters Estimates, analysts are expecting revenue of $27.64 billion and EPS of $2.11. Free cash flow for the full-year is expected to be $1.7 to $1.8 billion, with cash flow from operations of $2.4 to $2.5 billion.

In a release, Honeywell chairman and CEO Dave Cote said, "Our strong 2005 performance is the result of better processes, improved quality and delivery to our customers, and continued leadership in the industries we serve." He added that "These factors, combined with continued growth in the global economy and favorable macro-trends, such as energy efficiency, expanding concerns about safety and security, and increasing global flying hours, give us confidence in our prospects for 2006."

Accordingly, Honeywell projected fiscal 2006 sales of approximately $27.6 billion and earnings of $2.30 to $2.50 per share, including stock option expenses. This is in line with the consensus estimate for revenue of $30.1 billion and EPS of $2.41. In addition, the company said it anticipates free cash flow to be between $2.1 and $2.3 billion.

--Richard Jahnke, Briefing.com

09:50 am General Dynamics (GD)

110.21 -1.88: Defense contractor General Dynamics announced on Wednesday that it has agreed to acquire Anteon International (ANT 53.97 +13.20) for about $2.2 billion, or $55.50 per Anteon share, including the assumption of Anteon's $100 million of debt. The price represents a 36% premium over ANT's closing price of $40.77 on Tuesday. General Dynamics said the deal will expand its information technology services offerings and presence with the Department of Defense, and should be immediately accretive to earnings.

Anteon, based in Fairfax, VA, has about 9,500 employees and anticipates sales of $1.72 billion next year. General Dynamics chairman and CEO, Nicholas Chabraja said, "This superb company significantly strengthens the ability of our Information Systems and Technology group to provide a broad menu of seamless information technology services to Defense, Intelligence, and Homeland Security customers." As more defense contractors move toward the rapidly growing services business, the addition of Anteon should effectively compliment General Dynamics' technology and hardware focused operations.

The proposed acquisition, which is expected to close by the end of the second quarter of 2006, has been approved by the boards of directors of both companies, but is still subject to an affirmative vote by Anteon shareholders as well as customary regulatory approvals. In early trading, shares of Anteon have gained more than 32%. Conversely, shares of GD were trading down slightly on the announcement.

--Richard Jahnke, Briefing.com

09:17 am General Electric (GE)

35.47: In his annual address to shareholders yesterday, General Electric Chairman and Chief Executive Jeffrey Immelt reminded Wall Street that bigger is better, and reaffirmed the company's FY06 EPS growth forecast of 12-17%. After referring to the world's largest company by market value not as a "conglomerate" but as a "multi-business growth company," and introducing GE's "Go Big" theme for 2006, Immelt reiterated that it will continue to leverage its size to seize growth opportunities around the globe.

While Immelt expects sluggish growth in Europe, as sales in developed countries outside the U.S. are increasing about 5-10%, annual revenue growth of 20% in some developing countries (i.e. China and India), due to strong demand for GE's health care, energy and aircraft engines, will be a large focus as GE uses its huge size as the "foundation for growth, not as an impediment to growth." Immelt continued in his briefing, "Nobody can play the global card better than we can," reiterating that GE has the organizational structure in place to meet demands if it eventually doubles in size.

Overseas sales, which account for about 45% of GE's top line, are expected to increase 10% next year to $75 bln. Fairfield, Connecticut-based GE, which is on track for earnings of $1.72 per share this year, sees FY06 EPS of $1.92 to $2.02 (consensus $2.00) on revenues of $165 bln (consensus $173.2 bln) and, according to Immelt, is in "great shape" for almost any economic environment through 2008.

--Brian Duhn, Briefing.com

09:10 am FPL Group (FPL)

42.87: FPL Group, the parent of Florida Power and Light, is in advanced talks to acquire Constellation Energy Group (CEG) for more than $11 billion, according to The New York Times. The deal, which would create a utility company with operations all along the east coast, from Maine to Florida, would be the largest since Congress eliminated a 70-year old ban on interstate mergers of power companies last summer.

Although Robert Gould, a spokesman for Constellation, would not comment on market rumors, the Times reported that the negotiations could lead to an announcement within the next two weeks, but cautioned that the talks were at a particularly delicate stage. It noted that several important negotiating points still need to be worked out and that it remains possible the deal could collapse entirely.

A merger with Constellation would bolster FPL's operations, according to the report. Constellation, and its subsidiary Baltimore Gas and Electric, operate 10 power plants around the country, with generating capacity of approximately 12,000 megawatts. In fiscal 2004, the company posted $12.5 billion in revenue. At Tuesday's closing price of $56.27, Constellation had a market cap of about $10 billion.

Based on the news, shares of FPL were trading slightly higher in the pre-market, while CEG share were up more than 8%.

--Richard Jahnke, Briefing.com

09:06 am Dollar Drops as Japanese Confidence Rises

The dollar dropped like stone after the Japanese Tankan survey showed the highest business confidence in more than a year. Conviction in Japan's recovery is solidifying, driving the Nikkei to a 5-year high. Businesses are heavily investing at the fastest pace since the 1990's, as corporate profits rise. Residential prices in Tokyo finally reversed a 15-year decline as confidence mounts and consumers take advantage of record low rates. Japan is in its longest expansion period in eight years.

The Bank of Japan reported its Tankan index of confidence among the largest manufacturers climbed to 21 in the fourth quarter, up from a reading of 19 in the third. The index for non-manufacturers rose to its highest point in 13 years, reaching 17. A positive figure indicates the optimists outnumber the pessimists. The Tankan, which means short-term economic outlook, surveys 10,000 companies and is used by the Bank of Japan to formulate monetary policy.

The yen has been significantly underperforming, weakening to 121 to the dollar. The survey sparked a dramatic falloff in the dollar, sending the yen to 118.44. The Fed's removal of "accommodation" in its policy statement coupled with a quarter point rise in its target rate to 4.25% weakened the dollar against major currencies.

Since we first highlighted Japan's impending recovery in March of 2004, the ride has been a rocky one and the pace of recovery agonizingly slow. But now, the recovery is shining through all sectors of the economy, and taking hold. Economic reform, new demand from Asia, and an improving global economy are all pieces that have come together to lend support to the claim that this time the sun is finally shining in Japan.

--Kimberly DuBord, Briefing.com

08:59 am Boeing (BA)

70.59: The aerial dogfight between Boeing and the Toulouse, France-based Airbus may end with Boeing leaving its main rival in a cloud of smoke. Boeing's Dreamliner has been the hottest plane on the market, winning orders from carriers around the globe. Today, Boeing announced its largest order to date for the 787 by Australia's biggest carrier, Qantas Airways Ltd. As of the end of November, Boeing has won 806 firm orders, which outs it miles above Airbus at 687 planes.

The Aussie airline ordered up to 115 787s, valued at A$24 bln (USD$18 bln) after a 5-month competition between the two manufacturers. Its low-cost airline, Jetstar Airways, will use some of the planes, moving away from its current all-Airbus fleet. The order for Qantas, which carried almost 30% of international passengers through June, allows the carrier to reduce fuel costs and to meet rising demand for budget air travel in Asia. Roughly 30% of Boeing's new orders have come from Asia.

Boeing is on course to win the race in orders this year for the first time in five years. The Dreamliner has been extremely well received, winning orders over the Airbus A350 amongst others for short-haul international and domestic routes. The 787 burns 20% less fuel than other similar aircraft of the same size flying the same distances - a highly desirable characteristic as carriers face record jet fuel prices and higher operational costs.

The boom cycle in commercial aviation continues to take flight with Boeing and Airbus doubling orders from last year. We have long held a positive view on Boeing due to its strong order momentum and expected earnings growth. Notwithstanding its 36% year-to-date gain, we remain committed to Boeing shares as the upcycle continues to gain altitude.

--Kimberly DuBord, Briefing.com

10:09 am Celanese (CE): Target increase follows some conclusions in regard to its accounting issues, including that a substantial portion of the mortgage-related transactions with DRL and RGF did not qualify as true sales. They note that FBP announced it will restate earnings to reflect changes in the accounting treatment of the mortgage-related transactions, and that the co advised that previously filed financial statements from 2001 through 2005 should no longer be relied upon.

10:08 am First Bancorp (FBP): Downgrade is following some conclusions in regard to its accounting issues, including that a substantial portion of the mortgage-related transactions with DRL and RGF did not qualify as true sales. They note that FBP announced it will restate earnings to reflect changes in the accounting treatment of the mortgage-related transactions, and that the co advised that previously filed financial statements from 2001 through 2005 should no longer be relied upon.

10:06 am Electronic Arts (ERTS): Firm is saying to switch into ATVI. Firm notes that NPD sales data for ERTS was up just 8% in November (with units down 5%) and 7% quarter to date, well below their forecast of 16% for console and handheld sales in the quarter. Firm cuts their March quarter sales est to $660 mln (consensus $749 mln), which is below guidance of $710-$810 mln. Firm's call is to switch into ATVI, noting that the 54% sales gain compared to consensus forecasts closer to +10%. These strong results, now showing a 19% rise for October + November with momentum in the right direction, give them increased confidence in their forecasts that they had previously believed might be at risk.

09:53 am Cal Dive (CDIS): Firm believes investors are underestimating the co's earnings and growth potential. They believe mgmt's 2006 guidance is likely to come out over the next few weeks, and expect them to be fairly conservative and give numbers below their forecasts. However, they believe that even their assumptions on both commodity prices and Marine Contracting margins may prove too conservative.

09:53 am Edwards Lifesci (EW): Firm notes that the co has three additional cardiovascular business lines in addition to heart valves and critical care. Further, they note that EW is developing revolutionary heart valve technology that is potentially very valuable, but is very early in development and fraught with risk.

09:52 am Harmonic (HLIT): Downgrade is due to what firm believes is a material probability of flat to declining revenue in the next couple of quarters. They believe the key reasons for this are the losses of significant business at DTV, VZ and now DISH. Firm believes Tandberg Television of Norway has won significant market share for encoders at DirecTV and Echostar, and that SFA has won the 1550nm business at Verizon. Firm also cuts their Q4 and 2006 ests.

09:44 am Image Entertainment (DISK): Upgrade is based on valuation and the success of Disney's "Narnia Chronicles" live-action film currently in the domestic theatrical frame. Based on the Narnia success, they believe DISK is on track to at least meet, if not slightly exceed, previous guidance. They say that is because, as part of the Home Vision deal consummated last August for $8 mln in cash, DISK captured as part of the Home Vision catalogue the original BBC version of "The Narnia Chronicles."

09:44 am Select Comfort (SCSS): Upgrade is following co's positive guidance, as they believe that SCSS's momentum will continue into FY06, based on expanded awareness of the Sleep Number bed through several new retail partnerships and the growing relationship with Radisson, more effective gross margin control, comps support from recent price increase, and overall increasing demand for specialty sleep systems.

09:42 am Martek Biosci (MATK): Needham notes that Martek posted a better than expected quarter on nearly all counts. Although firm is lowering its revenue and EPS ests for FY06 (mgmt didn't give much in the way of guidance and firm's old numbers were the highest by a wide margin) Needham thinks things appear to be back on track. Needham notes that mgmt believes the safety stock issues at its infant formula customers are now behind it and normalized revenue growth and margin expansion should resume. The company is also in the process of negotiating better pricing with its formula customers... Needham reduces its previously high-on-the-Street revenue and EPS estimates, but believes there should be upside to these numbers.

09:42 am Mitcham Ind (MIND): Firm is noting that MIND reported fully diluted Q3 2006 EPS well above their estimate. They note that MIND is in the midst of expanding into Russia, a country where the bulk of the seismic assets are still 2-D. Long-term, they think Russia could provide the opportunity to create a business unit as large as the US and Canada combined for MIND.