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NYSE MAC DESK MID-DAY MARKET UPDATE:

DOW 16,439 (+30 points), S&P500 1868 (+4 handles), Brent Crude $109.93/barrel (+$0.40), Gold $1,286.00/oz. (-$7.40)

MARKET DRIVERS: (Stocks are modestly higher in a very quiet session amid a round of generally positive earnings reports and a pair of upbeat economic data releases.)

• The Conference Board’s index of U.S. leading indicators rose by 0.8% in March – the largest increase in four months – topping consensus while providing an important sign that the U.S. economic expansion will strengthen following the harsh winter weather.
• The Federal Reserve Bank of Chicago’s National Activity Index for March came in at 0.20 which was in-line with the Street’s consensus estimate.
• The Japanese trade deficit widened to ¥1.45 trillion yen, or about $14.1 billion in March. Exports climbed by just 1.8%, missing expectations for a 6.5% gain. Meanwhile, energy costs caused imports to jump 18.1%.
• On the earnings-front, Halliburton is trading at a new 52-week high after the company reported Q1 top and bottom-line digits that topped the Street’s consensus estimates.
• In addition, Advanced Micro Devices has rallied by 12%(!) after the semiconductor maker reported late Thursday Q1 adjusted EPS and revenue that exceeded expectations and provided an upbeat sales growth outlook for the current quarter.
• Just hit the tape: Meb Keflezighi won today’s Boston Marathon with an unofficial time of 2 hours, eight minutes and 36 seconds, the first American male to win the race since 1983.

Definitely one of the quietest trading sessions of the year, both in terms of trading volume and volatility as the major indices have been essentially range-bound since the opening bell. However, that does not mean we have nothing to report. Check it out:

1- If the Dow and S&P 500 can finish on the plus-side today, it would mark the first 5-day winning streak for the major indices of 2014.
2- Last week, the S&P 500 Index posted its biggest weekly gain since July, and at last look, the index was up 1.13% year-to-date.
3- This promises to be the busiest week of the quarter for earnings releases as 159 companies in the S&P and eleven Dow components are scheduled to report their Q1 digits between today and Friday.
4- Regarding earnings, more than 70% of the companies that have announced results so far this season have beaten analysts’ profit estimates. For the record, Street analysts project that earnings at S&P 500 companies increased 0.7% in Q1, while revenue climbed 2.6%, according to the average estimate.
… Moving on, the Dow has settled into a narrow trading range in an extremely quiet session, with just ~215M shares on the tape at this time… Internally, breadth is bullish across the board. Advancing Issues: 2410 / Declining Issues: 1789 — for a ratio of 1.3 to 1. New 52-Week Highs: 240/ New 52-Week Lows: 40… Meanwhile, in the trading pits the 10-year US Treasury has rallied, dropping the yield back below the 2.7% level, (2.698%), while gold is near a three-week low amid improved risk appetites and less of a reliance on the safe haven trade… By the way, in case you haven’t heard, the Zen-Master has begun to make his presence known in NYC as the Knicks canned Coach Woodson and all of his assistant coaches this morning. And to our friends up in Beantown celebrating Patriot’s Day today: “Boston Strong!” -— Have a tremendous day!

John’s Options Commentary: Option investors appear to be very optimistic today. With the SPYders (SPY) trading around $186.74, customers are paying roughly 35 cents for more than 97,000 May 192 calls. The transactions are opening and express a very bullish view of the markets over the next 4 weeks—we shall see! The Market Vectors Semi Fund or SMH also sees bullish flow today. With the ETF trading $45.08, a customer buys a 14,500-lot of Aug 50 calls for 37.5 cents. Investors have also bought the Aug 47 calls, as more than 4,700 contracts have changed hands so far today. The activity appears to be another bullish view, this time on the chip over the next 4 months. The Emerging Markets Fund (EEM) saw a bullish three-way spread trade earlier this morning. With the EEM trading $41.80, a 10,000-lot of Dec 35 puts was sold at $1.00 on the ETF to buy the Dec 42 - 46 (1X2) call ratio spread, 10,000 times. It looks as if the investor sold the puts to help finance the call spread. The Call Dec 42 calls traded at $2.45 while the 46 calls were sold (twice) at 90 cents. The net proceeds on the transaction was 35 cents. I looks as if the customer is looking for the EEM to climb to the $46.00 level by December expiration. The VIX is treading water today, up .06 to 13.42.

Sector Highlights brought to you by http://www.streetaccount.com/

• Energy outperforming with the S&P Energy Index +0.4%
o Brent crude higher by $0.40 to $109.93. Natural gas (0.6%).
o Oil services topping gains with the OSX +0.5%. HAL +3.1% in focus after beating earnings expectations. Analysts pointed to better LatAm performance and the company’s guidance for close to 20% NAM margins by the end of the year. BHI +1.9% and SLB +1.4% the other notable gainers. The former continuing its post-earnings rally from Thursday. NE (1.2%) was downgraded at Global Hunter Securities, which notes the uncertain contracting environment and limited near-term catalysts.
o Refiners outperforming, led by PSX +1.1% and TSO +1%
o E&Ps underperforming with the EPX (0.4%). NFX (1.4%), PXD (1.4%) and WTI (1.4%) leading the way lower. SM +1.2% the notable performer to the upside.

• Healthcare outperforming with the S&P Healthcare Index +0.4%
o Pharma outperforming with the DRG +0.7%. AZN +5.5% in focus amid reports that PFE +0.8% is considering a bid for the company. ENDP +2.2% and ACT +1.3% the other notable outperformers. Note the latter announced the acquisition of four products from AKRX +2.1%. TEVA (0.1%) underperforming after the Supreme Court denied its request for injunction on the Copaxone decision. Sell-side said a generic launch of Copaxone will create a new overhang for shares.
o Biotech mixed with the IBB +0.2% and NBI +0.2%. SRPT +42.5% the notable performer amid plans for Eteplirsen NDA by year-end. Barron’s also had a positive feature on the company, believing shares could double. The stock was upgraded at William Blair today. MNTA +6% another outperformer amid the Supreme Court’s decision in the TEVA Copaxone case.
o Other notable performers: ATHN (8.2%), which missed earnings expectations.

• Tech outperforming with the S&P Information Technology Index +0.3%
o Hardware largely outperforming with AAPL +0.8% . Bunch more previews hit today. Focus seems to be on issues such as June quarter guidance (expectations seem fairly lackluster), capital allocation, upcoming product cycle, China Mobile ramp. EMC +1.1% also reports on Wednesday. Some talk about low expectations heading into the print. Somewhat positive commentary on name out of Credit Suisse and BMO today.
o Semis outperforming with the SOX +0.5%. AMD +12.3% the standout following its beat and raise. High short base said to be contributing to outsized rally. MU +3.8% on the back of an upgrade at Drexel Hamilton. Semicap equipment narrowly mixed despite some concerns over collaboration between Samsung and Global Foundries in mass producing 14nm FinFET.
o Internet mixed following last week’s reprieve for momentum/high-valuation names. FB +2.1% one of the best performers. Company expected to reveal mobile-ad-network plans later this month. Stock also reiterated buy at both Goldman and CRT heading into earnings this week. GOOGL (0.9%) extending Thursday’s post-earnings pullback. Recall Street largely defended stock following softer results.

• Industrials in-line with the S&P Industrials Index +0.2%
o Multis underperforming. LII (3.8%) the laggard after reporting Q1 results. RBC (1%) and IR (0.9%) also underperforming. Upside limited with GE +0.2% and DOV +0.2% topping gains.
o Machinery underperforming. TEX (1.4%), OSK (1.3%) and JOY (1.1%) leading the space lower.
o Transports mostly lower. Airlines underperforming. Rising oil prices cited as a headwind. Note the space has sharply outperformed this year. ALK (1.5%), SKYW (1%) and DAL (1%) the notable performers. YRCW (1.2%) and ABFS +0.7% the notable performers among the trucking names. Railways outperforming, led by KSU +1% and NSC +0.4%. Note increased rail traffic. AAR reported rail traffic is up 33 of the past 38 weeks.
o Other notable performers: PWR (2.1%), USG (1.8%)

• Materials underperforming with the S&P Materials Index +0.1%
o Precious metals equities underperforming. Underlying assets lower today, with SLV (1.3%) leading GLD (0.7%) to the downside. Merger chatter between NEM +6.4% and ABX (2.6%) in focus. Latest reports indicate the issues stalling a merger include exactly what might be spun out. PAAS (3%) and SSRI (3%) the other notable performers.
o Industrial metals underperforming. CENX (3.8%) leading the aluminum space lower. Global miners underperforming with VALE (1.3%) and RIO (0.6%). Steel space mixed, with X (2.1%) underperforming while RS +1.1% tops gains. CLF (2.4%) the other notable performer among the industrial metals names.
o Other notable performers: OI (1.7%), EMN (1.3%)

• Financials underperforming with the S&P Financials Index +0.02%
o Banking group getting most of the attention. BKX +0.1%. Mixed overall performance with several regionals holding up better. STI +1.8% after reporting one of the strongest set of results for Q1. Street positive on lower expenses, better fees, strong credit quality and commercial loans. C (0.6%) the laggard among the money centers after outperforming last week when its results came in better than feared. Some sell-side notes out today discussing earnings season for the group. Focus has been on revenue headwinds, particularly in terms of mortgages. Lingering NIM pressure another widely discussed overhang. Also some attention on slowing improvement of credit trends. Trading held up a bit better than expected, while commercial loan growth another positive.