Volatility At The Open

Morning News of Note:

• STX: Seagate Insiders Bailing Out of Shares SEAGATE INSIDERS ARE TAKING hefty profits as Wall Street digests news of its recent acquisition. The maker of hard disk drives and storage solutions closed the purchase of former rival Maxtor on May 22 for $1.9 million in stock. The deal had been announced in December. A day after the merger closed, Seagate Chief Financial Officer Charles Pope told investors that desktop demand for its hard drives was slightly below initial expectations, but that the second quarter ending in June is traditionally the slowest quarter for the company. (Full Story) BARRONS
• OPTV TWX: Time Warner Sets A Deal to Expand Cable-TV Services Time Warner Inc.'s cable-television unit plans to offer customers a way to obtain new features faster as it competes with telephone companies for dominance of the digital home. In the deal, set to be announced today, Time Warner Cable has agreed to upgrade as many as four million of its cable set-top boxes with operating software developed by OpenTV Corp. (Full Story) WSJ
• GOOG: Google Advances Software Challenge With Spreadsheet Google Inc. plans today to release a Web-based spreadsheet application allowing users to collaborate online, in a further foray into Microsoft Corp.'s traditional turf. The introduction of Google Spreadsheets follows Google's March purchase of a company offering a Web-based word processor named Writely. The two free Web-based Google services overlap with Microsoft's core Excel spreadsheet and Word word-processing software. (Full Story) WSJ
• IBM: AP reports IBM (IBM) said Tuesday it would triple its investment in India to $6 bln over the next three years as the country becomes a cornerstone in the global network of the co. Chairman and Chief Executive Sam Palmisano said the investment will be used to build service delivery centers in Bangalore, India's technology hub, and create a telecommunications research and innovation center for IBM clients around the world. Palmisano also said IBM would increase the number of its employees in Bangalore, without elaborating
• Mad Money Summary: Cramer opened his show by saying that it is time to learn to love volatility and make money off of it. He suggested a few volatile plays: Occidental Petroleum (OXY), Pepsi (PEP) and Sears (SHLD). Cramer then recommended buying power plant operator Dynegy (DYN), which is looking to sell itself. Cramer then interviewed the CEO of Crystallex International (KRY) over the telephone. Cramer concluded that Crystallex is OK, but he wish they had their approval from the ministry of the environment, and we they get that approval, he sees the stock going to $6. In the "Lightning Round," Cramer was bullish on MasterCard (MA), Newmont Mining (NEM), Schering-Plough (SGP), Las Vegas Sands (LVS), Wynn Resorts (WYNN), International Game Technology (IGT) and Freeport-McMoRan Copper & Gold (FCX), and was bearish on Vonage (VG), Home Solutions of America (HOM), Clear Channel Communications (CCU), Dell (DELL), Ecolab (ECL), Sun Microsystems (SUNW), Forest Laboratories (FRX) and MGM Mirage (MGM).

Market Comments: The market opened on an up note but quickly reversed into negative territory. It is once again trying to climb back. The volatility indexes (VIX/VXN) are both higher again, and the CBOE put/call ratio opened above 1.0. This should help keep a bid underneath the market.

The fed funds futures are again pricing in a 75% chance of a rate hike in June. But as we have seen with each piece of economic data to hit the market, things change quickly. Even if they do raise at the end of the month, it is likely the last one for a while, and that should remove one overhang from the market.

Commodity stocks are mostly down again, and it looks like this group may be rolling over for a while. It will be interesting to see what group moves into the leadership role when the market tone improves.

long GOOG, STX, TWX