Morning Look

Morning News of Note:

• DELL: Dell Issues Sales, Profit Warning PC Maker Cites Weakness In U.S. Consumer Market And Swollen Inventories Dell Inc. warned it would miss its fiscal third-quarter earnings and sales forecasts, blaming continued weakness in its U.S. consumer business, excess inventories and slack sales in its United Kingdom business. Dell also said it would take a $450 million charge in the quarter. Dell's troubles come at a time when the world-wide personal-computer market is showing strong gains. (Full Story) WSJ
• WMT: Wal-Mart StoresWal-Mart Stores-WMT will sell HPQ laptop and desktop for $398-CNET: WMT has taken the laptop and the desktop to a new price low for this years holiday season. The company hopes the low price point will spark consumers to come and shop its imputer hardware and software offerings.
• GDT JNJ: U.S. Approval Is Expected Soon for Sale of Guidant Johnson & Johnson's proposed acquisition of the Guidant Corporation is expected to be approved by the Federal Trade Commission as early as today, executives involved in the deal said yesterday. Approval of the transaction may force the companies to end a standoff over renegotiating the price of the $25.4 billion deal. (Full Story) NY Times
• Oil M+A: Heard on the Street... Windfall Oil Profits May Lead to Merger Blitz With oil profits surging, and worries increasing about where future supply will come from, some predict a gusher of big deals in the oil and natural-gas patch. Mergers and acquisitions within the energy sector have been on the upswing, often at hefty prices. (Full Story) WSJ
• US Economy: CIO Magazine Oct tech survey future growth index 1.8 vs 3.8 in Sept; IT budget increases up 6.7% in past 12 mo's, up 5.2% in next 12mo's vs Sept expectations up 9.3%

Market Comments: The market is opening on a weak note, pressured by the warning from DELL. Of course, the Fed meets today, so most of the action won't come until this afternoon. Everyone knows that they will raise rates another 25 basis points today, but the key will be if there are any subtle changes in their language that follows.

I find it laughable that the FOMC can tell us with a straight face that monetary policy was accomodative when the fed funds rate was at 1%, and that it is still accomodative with the rate up at 4%. I continue to believe that they are close to being done, which should relieve significant pressure from the market, allowing it to rise further.

long JNJ, WMT