Market Opens On Sour Note

Morning News of Note:

• North Korea test-launches missles - WSJ
  The Wall Street Journal reports North Korea test-fired six ballistic missiles, including a long-range Taepodong 2 missile, in a significant escalation of its confrontation with the U.S. over its weapons programs. U.S. and South Korean officials said the test of the Taepodong 2, which had been expected for weeks, was an apparent failure, as the rocket broke up around 40 seconds after launch. It is unclear if it self-destructed, if it was destroyed on command because of system failures, or if the launch was intended as a planned test of just its first stage. The other tests were of shorter-range missiles, mostly of the North Korean Nodong class, all of which crashed into the Sea of Japan far from Japanese territory. U.S. officials said they believed North Korea's launch of the Taepodong 2 was a violation of its self-imposed moratorium on long-range missiles tests. The Bush administration said it was working closely with its South Korean, Japanese and Chinese counterparts to devise a response to Pyongyang's actions, including the possible imposition of economic sanctions.
• SBUX Starbucks Japan to open at least 100 stores a year - Reuters
  Reuters reports Starbucks Japan (SBUX) new chief executive said on Wednesday the co aims to open at least 100 stores in Japan every year. Chief executive Maria Mercedes M. Corrales did not specify how for many years the co would pursue this plan. Starbucks Japan reported a 51% rise in annual full-year net profit in May on strong sales of high-margin products, and forecast further growth of 12.6% in the current business year. The firm's same-store sales rose for the first time year-on-year in the year ended March due to brisk sales of limited-time offers, including drinks and coffee beans, and food items such as hot sandwiches.
• WAG Walgreen Jun same store sales increase 9.0%, Briefing.com consensus +8.0%
• OXY Occidental Petro guides below consensus for Q2, will classfy Block 15 investment as discontinued op
  Co issues guidance below consensus for Q2 (Jun), sees EPS from continuing ops of $2.70-2.80 vs. $2.88 Reuters Estimates consensus. Co also announces that recent seizure of co's Block 15 investment in Ecuador will result in OXY recording a net year-to-date after-tax charge of $306 mln, ($0.71 per share) in discontinued operations.
• CNBC reports Enron founder Ken Lay has died at the family home in Aspen, CO

Market Comments: The market was overbought, and due for some sort of pullback, but all of the credit for this morning's decline will go to N. Korea for its missile test last night. What a charade. This news also has oil and gold trading higher.

ADP commented that payroll data likely indicates a strong jobs report this Friday. This news was not greeted well by the bond market, pushing yields on the 10-year up to 5.22%.

These stock options inquiries are really weighing on tech stocks. MRVL is getting crushed, and ZRAN id down huge this morning also. I think the decline in ZRAN could set the stock up for a positive surprise when it reports earnings.

One stock that has shaken off the early weakness is AKAM, which is reversing higher.

long AKAM, WAG