Bernanke Speaks

Morning News of Note:

• BLK MER: Merrill, BlackRock Unveil Deal BlackRock Inc. and Merrill Lynch announced that they have reached an agreement to merge Merrill Lynch's investment management business and BlackRock to create an asset-management firm with nearly $1 trillion in assets under management. Merrill Lynch's stake will go to 49.8%, and it will have a 45% voting interest in the combined company (Full Story) WSJ
• ENER: Solar Power Gets Its Day in the Sun, But Still Carries Risks for Investors President Bush's State-of-the-Union teleprompter had barely dimmed when Wall Street geared up for a festival of sun worship. Investment bank First Albany hosts a conference today in New York on solar power. (Full Story) WSJ
• INTC AMD: Digitimes reports with reports surfacing that Intel will lower prices for its 65nm Pentium D 9xx-series processors by 13-50% on April 23, Taiwan motherboard makers realize that although the price cuts may be a boon for the market, there will now be a temporary lull in the PC market, as players wait before making any unnecessary moves. Investors have predicted that with reduced working days and with relatively high inventory levels in the channel, motherboard shipments will drop 15-20% in February. In addition, with AMD launching its DDR2-supporting CPU line in the second quarter, March and April are likely to continue being low months. However, on the bright side, sources stated that motherboard makers expect the Intel price cuts to trigger a pickup in the market, and demand should increase dramatically through the second half of the year, with the launch of Microsoft's Vista operating system also expected to drive demand for new PCs.
• TGT: Target-TGT sees February SSS up 2.5%-3.5%. The company's previous outlook for SSS was 2.5%-4.5%
• Mad Money Summary: The first stock Jim Cramer discussed was Caliper Life (CALP), a drug development play. Another stock he suggested buying was Petroleo Brasileiro (PBR), a Brazilian state-owned oil company which Cramer believes is about to "conquer Bolivia." Seagate (STX) and Maxtor (MXO) were also suggested by Cramer, because he believes that investors still have a chance to capture some gains before the companies' merger closes. In the Lightning Round, Cramer was bullish on First Data (FDC), Vivendi (V), Marvell (MRVL), Knight Capital (NITE), Google (GOOG), Costco (COST), Peabody Energy (BTU), Ultra Petroleum (UPL), VCA Antech (WOOF), Parallel Petro (PLLL) and Lufkin (LUFK), and was bearish on Oakley (OO), Chesapeake Energy (CHK), Whole Foods (WFMI), Alliance Data Systems (ADS), Palomar Med Tech (PMTI), Escala (ESCL), Vector Group (VGR), Mindspeed Tech (MSPD), and Freightcar (RAIL).

Market Comments: While many feared that Bernanke's testimony would be hawkish, the market rallied in the day leading up to his testimony, and is rallying further this morning as the testimony begins.

Bernanke commented that the inverted yield curve is not signaling an economic slowdown this time. He also mentioned the global savings glut is keeping a lid on long-term yields. The 10-year yield has drifted back down to 4.59%, and crude oil is hovering below $60.

The market is up pretty much across the board, although it is still early. Brokers are getting a big lift, helped by the Blackrock/Merrill deal, followed by homebuilders and biotechs.

long INTC