Some Thoughts:

Today is Cinco de Mayo.  Most of us in America think that this is just another excuse to enjoy a nice cerveza.  But the real story of Cinco de Mayo is that it is the  anniversary of the Battle at Puebla in 1862 between an under-armed, under-manned Mexican army against a well-armed French Army.   The French were in Mexico because in 1861, Mexican President, Benito Juarez, declared a 2-year moratorium on loan repayments to foreign nations, including Spain, England, and France in an attempt to avoid bankrupting the country. All three nations invaded Mexico to collect on debts. While Spain and England left, France tried to stay and take over the country.  Imagine that – a sovereign nation failed to pay its debts and other nations decided to invade to get their money back.  No bailouts, no money printing, no CDS’s..just plain old war.  If Ben Bernanke were around in 1862, he probably would have just printed a few billion pesos and there would not have been a Battle at Puebla  and we wouldn’t be enjoying those ice cold cervezas after the close today.

Volatility has a way of sneaking up on you.  But we shouldn’t be surprised at the rise in the VIX that we have seen over the past few days.  How many potential disasters can the market take before investors start to race to get some put protection.  Volcano ash, oil spills, terrorism, European debt crisis, record high unemployment, the end of home buyer tax credits and of course the old market adage of “sell in May”.  The question is not why the VIX has risen but how high can it go.

Where we left off 4:00pm EST:

INDU                      10,926.77              -225.06

SPX                        1173.60                 -28.66

CCMP                    2424.25                 -74.49

Futures now at 7:30am EST:

DJA                        -25.00

SPA                        -5.40

NDA                       -8.75

Key Data out today: Get Ready. Phew!

7:00:       Mortgage Applications (+4.0 actual)

7:30:       Challenger Job-Cut Report (Prior 67,611)

8:15:       ADP Employment (Estimate +30,000)

10:00:     ISM Services (Estimate 56.4)

10:30:     Crude Oil Inventories (358.5 mb)

Since yesterday’s close, some key stories:

–       News Corp profits up on Avatar, as recovery.

–       XL Capital Q1 profit tops street, book value rises.

–       Cephalon profit soars, raises 2010 EPS forecast.

–       Atmel’s Q1 results Q1 beats street.

–       Microsoft launch new mobile software

–       InterMune dropped 80% after FDA letter.

–       Greece, Greece and more Greece.

–       Euro drops below $1.30 for the 1^st time since last year.

Significant Movers This Morning:

	US – Upside
Symbol	Name	Last	%	Mrkt Cap	Headlines
AMMD	American Med System	$19.50	11.68%	1,311	Earnings
DGIT	DG Fast Channel	$31.00	8.40%	1,002	Earnings
ACAS	American Capital	$6.35	4.61%	1,707	Earnings
S	Sprint	$4.23	3.17%	12,434	Upgraded
	US – Downside
Symbol	Name	Last	%	Mrkt Cap	Headlines
ITMN	Intermune	$10.16	-77.60%	?	FDA letter
MYGN	Myriad	$18.25	-24.20%	?	Earnings
NWSA	News Corp	$14.60	-5.10%	42,171	Earnings
FWLT	Foster Wheeler	$27.65	-3.96%	3,669	Earnings

Earnings Today:

Ticker                     Estimate                 Actual

AGU                       0.33                        -.04

ALY                         -.12                         -.14

AMRI                      0.05                        0.02

ANR                        0.55                        0.69

APL                        -.10                         -.03

ATRO                     0.08                        0.31

AYR                        0.31                        0.26

CBZ                        0.31                        0.28

CGX                       0.47                        0.54

CLH                        0.42                        0.40

CLMT                     0.37                        -.36

CPN                       -.11                         -.10

CTB                        0.15                        0.19

DFT                        0.29                        0.30

DGIT                       0.19                        0.41

DVN                       1.47                        1.85

DWSN                    -.20                         -.35

ENG                       0.03                        -.06

FCN                        0.62                        0.67

FLY                         0.47                        0.55

FWLT                     0.55                        0.56

GOLF                     -.20                         -.30

GRMN                    0.41                        0.38

GTS                        0.31                        0.37

HK                          0.13                        0.13

HLS                        0.43                        0.48

HUGH                    -.12                         -.29

INSP                       0.04                        0.04

KCP                        0.03                        0.10

KG                          0.24                        0.14

LNCE                     0.27                        0.04

LOJN                      -.19                         -.32

LSE                        0.18                        0.18

MWA                      -.10                         -.11

NGLS                     0.30                        0.14

NJR                        1.74                        1.78

NMRX                    0.02                        1.00

NWN                      1.75                        1.64

NXTM                     -.20                         -.19

OWW                      -.07                         -.05

PHM                       -.22                         -.03

POL                        0.15                        0.19

POWL                    0.42                        0.85

PQ                          0.10                        0.46

PWR                       0.08                        0.11

Q                             0.09                        0.10

RRD                        0.30                        0.33

SIRO                       0.47                        0.64

SPW                       0.26                        0.37

TAL                         0.31                        0.53

TLM                        0.10                        0.12

TNDM                    0.30                        0.25

TRR                        -.14                         -.10

TRW                       0.73                        1.65

TWX                       0.48                        0.61

UPL                        0.55                        0.55

WBC                       0.25                        0.51

WCG                      0.14                        0.17

WMB                      0.37                        0.36

WPZ                       0.74                        0.61

XTO                        0.48                        0.55

Expected Earnings Later:

AAWW, ABCO, ADCT, AEE, AEL, AFG, AHT, AIN, ALNY, ALTH, ATO, AVCA, AVNW, AYE, BBBB, BBX, BEE, BGCP, BMC, CBEY, CBR, CBS, CCRN, CECO, CELL, CETV, CGV, CHDN, CLR, CLWR, CNL, CNP, CNW, COGT, COT, CPA, CSII, CSU, CTL, CVGI, CXW, DGLY, DSCM, DXCM, EBS, ECHO, EDGR, EDGW, EDMC, EIG, ELMG, ELOY, ENOC, ENSG, EQY, EROC, ES, ESS, EXLS, EXM, EXPD, EXXI, FARO, FBN, FFG, FLML, FLS, FPIC, GAIA, GCA, GDP, GEO, GGC, GHDX, GLBL, GMXR, GNCMA, GOV, GSS, HAIN, HAWK, HIL, HMX, HNSN, HVT, HYC, ICE, ID, IO, IT, JAZZ, JDSU, KAR, KIM, KNDL, KRA, KRG, KS, LGCY, LGND, LINC, LIOX, LPSN, MDH, MFN, MHGC, MIC, MINI, MITI, MMLP, MOH, MRT, MSSR, MTZ, MUR, NC, NCIT, NEWS, NKTR, NLCI, NPSP, NRP, NSIT, NVEC, NWK, OEH, OIIM, ONNN, ORA,OSUR, OTT, OUTD, PAA, PACR, OGN, PGTI, PKD, PL, PNNT, PPO, PRA, PRO, PRSC, PRU, PVA, PVG, PWE, QLTY, QSFT, RAE, REG, REXI, RIG, RJET, RLH, RMTI, ROCK, RUBO, RWC, SAM, SBGI, SDBT, SENO, SEP, SHEN, SLF, SMSI, SONE, SSS, STAN, STO, SVNT, SWM, SYMC, TACT, TDSC, TEG,TGH, THQI, TRAK, TRGT, TRID, TRK, TS, TSCM, TTEC, TU, UGP, UNTD, USMO, VALE, VG, VIRL, VOLT, VSH, VTAL, WES, WGL, WIN, WMZ, WRES.