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Reading Into Palm's Future


New smartphone looks to grab market share from vaunted competition.

Minyanville Morning Memo

One to Watch: Palm (PALM) is out with earnings after the close today. Up over 350% this year, the shares are certainly no steal, especially since its competition includes Research in Motion's (RIMM) CrackBerry and an Apple's (AAPL) iPhone which literally inspires larceny. But its touch-screen Pre smartphone, appropriately launched on the June 6th anniversary of D-Day, is off to a start so strong Apple's co-founder was unable to snag one. The 80's were iconic for Filofax and a now-quaint product called PalmPilot gained cultural currency a decade later. Nothing stays the same so while Palm is currently perceived as a pygmy up against giant competition from Canada and California, its comeback commands respect. Analysts will look past today's quarter and focus instead on future guidance. Close to a 20 month high, this could be an interesting trade.

What Just Happened: The Dow fell for a fourth straight day after the Fed adopted a stand pat stance by the Potomac. Asia fared better after Tokyo increased over two percent overnight. And while the really rich will always be with us there were less of them last year, the latest Merrill Lynch/Capgemini World Wealth Report showing a 25% decline in ultra high net worth individuals.

What's Happening: Europe is in the red as Ireland learns it isn't easy being green. The IMF is calling for a 13.5% fall in the Emerald Isle's GDP. Back to the futures, ahead of this morning's economic data U.S. equities are indicating a fairly flat open. Bonds are inching higher in anticipation of another big auction. The dollar gained ground on the yen. Oil is up premarket; perhaps political turmoil in a critical region is at last exerting an impact? (Enough about Albany, I mean Iran).

What Will Happen: At 8:30 AM Eastern weekly jobless claims are expected to drop to their lowest level since January. The final figure for Q1 GDP, out at the same time, is anticipated unchanged at minus 5.7%. We'll also be learning about earnings from several companies, with Accenture (ACN) looking to accentuate the positive along with ConAgra Foods (CAG), Micron Technology (MU) and Finish Line (FINL).

Happenstance: Who'd be a Federal Reserve chairman? At 10:00 AM today up on the Hill Ben Bernanke gets a grilling on the gunshot gift that keeps on giving, Merrill's merger with Bank of America (BAC). A mantra of high finance may be "don't fight the Fed," but California congressman Darrell Issa didn't yet the memo yesterday. Wall Street hates uncertainty and while no one is seriously suggesting his job is in jeopardy, this food fight is an unwelcome distraction for the market. In the unlikely event he ever does encounter unemployment, it could be a further boon for beards.
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