Affymetrix Inc lowers its full-year revenue forecast.

Citigroup, Inc cut his 2008 and 2009 earnings estimates for the biggest U.S. bank, citing a slowdown in consumer finance and capital-markets growth.

Compuware Corp reported fourth-quarter sales and earnings that exceeded analysts' estimates.

Crocs Inc will layoff 600 Canadian plant workers after lowering annual earnings and sales forecasts as consumer spending slowed.

Delta Air Lines Inc and Northwest Airlines Corp. announced a merger that would create the world's largest carrier.

Intel Corporation is expected to post a narrow gain in earnings per share when it reports earnings after the closing bell.

First-quarter net income of Johnson & Johnson rose 40%.

“The market is starting to price in more aggressively a euro-zone slowdown,” said Omer Esiner, analyst at Ruesch International Inc. “We're forming a triple top around $1.59. Every time we get up here, the euro loses steam. But $1.62 is in the realm of possibility.”

Michael Woolfolk, economist at Bank of New York: “Today's TICS report dovetailed with U.S. PPI and Empire Manufacturing to knock the wind out of dollar bears who are searching this week for a catalyst to test the 1.6000 barrier in the euro/dollar.”

GBP/USD slid to lows near $1.9600, where bids were mentioned. Currently rate holds near $1.9619.

EUR/USD triggered bids and stops in the $1.5770 area, sliding to a new session low on $1.5750, where bids were mentioned earlier.

The dollar rose against the euro and yen as reports showed U.S. wholesale prices advanced almost twice as much as forecast in March and New York state manufacturing unexpectedly expanded this month.
The British pound fell to the all- time low per euro after a report showed the U.K. housing slump is the worst since 1978.
The euro dropped from an intraday high of $1.5875 after the ZEW Center for European Economic Research showed investor confidence in Germany unexpectedly fell this month.
European Central Bank council member Yves Mersch said in an April 12 interview in Washington that the central bank has no room to lower borrowing costs with inflation likely to breach the bank's 2 percent preferred limit in 2009.
The New York Fed's general economic index, which measures manufacturing in the state, rose to 0.6 in April from minus 22.2 in March, the bank said. The median forecast was minus 17.
The Fed has lowered its target rate for overnight bank lending by 3% since September to 2.25%.

USD/JPY holds near Y101.50 as the greenback holding a modestly positive tone across several pairs. Earlier highs were marked at Y101.69 but offers remain in

place atop Y101.80 still.

“The outlook for the dollar is favorable,” said Michael Woolfolk, senior currency strategist in New York at Bank of New York Mellon. “The Fed cannot keep cutting interest rates aggressively. The economy is not deteriorating as rapidly as people thought.”

EUR/USD: $1.5685, $1.5540
USD/JPY: Y101.00, Y100.00, Y102.00
EUR/JPY: Y160.85, Y161.00
AUS/USD: $0.9200, $0.8950

GBP/USD easing to $1.9625 ahead of the London close. Some noting the option strike ahead of $1.9600. Bids seen $1.9615/00 with stops below.

Blue chips rose and the broader market meandered Tuesday morning as investors eyed record oil and gas prices, a mild reading on core inflation, a strong regional manufacturing report and earnings from Johnson & Johnson and others..
Delta Air Lines announced a long-expected deal to buy Northwest Airlines for about $3.1 billion in a move that will create the world's largest airline. Delta shares fell 9% and Northwest shares fell 4%. Shares of other airlines also trended lower, amid questions about how this might lead to a broader consolidation in the industry.
Johnson & Johnson, the maker of drugs and healthcare products, reported higher quarterly sales and earnings that topped estimates. Shares of the Dow component were little changed.
US Bancorp reported weaker earnings and higher sales, all of which topped forecasts. The bank attributed its weaker earnings to the mortgage market fallout, but said its credit problems are manageable. Nonetheless, shares dipped.
On the downside, Crocs plunged nearly 40% and topped the Nasdaq's most-actives list after the shoe retailer warned late Monday that first-quarter earnings won't meet forecasts.
Housing bust continues. Foreclosure filings jumped 57% in March versus a year earlier, according to an industry study from RealtyTrac. The March figure was also up 5% from the previous month.
Commodity prices. U.S. light crude oil for May delivery rose $1.59 to $113.35 a barrel on the New York Mercantile Exchange after hitting a record $113.93 in electronic trading.
The national average price for a gallon of regular unleaded gas hit an all-time record of $3.386, AAA reported.
COMEX gold for June delivery rose $2.80 to $931.50 an ounce.
Treasury prices fell, raising the yield on the benchmark 10-year note to 3.54% from 3.51% late Monday. Bond prices and yields move in opposite directions.

"The Treasury International Capital System (TICS) report shows that net foreign inflows rose from about $57 billion the two previous months to about $72.5 billion in February. Private sector purchases of U.S. Treasures rose by $24.1 billion after declining the two previous months but "official" institutions reduced their holdings. Among other asset classes, foreign purchases of agencies topped smaller inflows into the corporate bond market and still small investments in corporate stocks."

Stocks get a modest lift from a recovery within the financial sector (+0.5%). The major indices are now trading in mixed fashion, with the Nasdaq posting a slight loss.

"Empire State survey index jumped to 0.6 from -22.2, far above the consensus, -17.0. Reports like this give regional surveys a (mostly deserved) bad name. It is inconceivable to us that real business conditions have improved to this degree in the NY region over the past month, so we strongly recommend taking no notice at all of the headline number. The subindexes were stronger than in March but the rise in new orders, to 0.1 from -4.7, seems much more plausible than the headline. It is tempting to blame seasonal adjustment chaos, due to the exceptionally early Easter, for the jump in the headline but we cannot be sure. Either way, don't take it seriously."

"While we expect the softer economy to reduce finished goods price pressures in the months ahead, the persistent and resurgent cost increases have raised Fed anxiety over its inflation-fighting credibility."

The stock market slips in its best levels, but remains in the green. Nine of the ten economic sectors are posting a gain.
Financials (+1.1%) are leading the way in response to the better than expected earnings results from US Bancorp (USB 31.94, +0.27) and Northern Trust (NTRS 66.88, +1.88).
Consumer discretionary (-0.2%) and healthcare (-0.1%) are the main laggards.

RBC analyst TJ Marta: PPI "will cause the market to focus a more on the inflation problems confronting the Fed, although the Empire figure does not likely reflect the overall economy, but rather the one sector that is benefiting most from the weak US$. The combination of high inflation and slow growth continues to augur for "stagflation-lite"."

The stock market opens on a strong note. Lifting the market is better than expected earnings from Johnson & Johnson (JNJ), US Bancorp (USB), State Street (STT) and Northern Trust (NTRS).
Also fueling some buying interest is word that Delta Air Lines (DAL) is going to acquire Northwest Airlines (NWA). Each share of Northwest will be worth 1.25 shares of Delta.

Futures (S&P futures vs fair value: +6.2. Nasdaq futures vs fair value: +4.5.) manage to extend their gains despite a higher than expected inflation reading. Just reported, March Producer Price Index (PPI) rose 1.1% month over month, compared to the expected 0.6% rise. PPI excluding food & energy gained 0.2%, which matched the consensus estimate. That leaves PPI up 6.9% year over year, and PPI excluding food & energy up 2.7%. Separately, the April Empire Manufacturing reading came in at +0.6. Economists expected a reading of -17.0. In earnings news, Johnson & Johnson (JNJ) reported earnings of $1.26 per share, which topped expectations by six cents. Charles Schwab (SCHW) reported earnings of $0.26, which met expectations.

Net foreign purchases of US L-T securities were $72.5 bn with net foreign purchases of L-T secs of $82.8 bn offset by $10.2 bn of foreign securities buying by US residents.

Empire data come stronger than expected and PPI double expectations. EUR/USD posted low at $1.5786 before returned to $1.5810. Offers now seen placed to $1.5860 (76.4% $1.5875/1.5815), a break above to open a push back toward the earlier rally highs at $1.5875.

The euro traded near a record high against the dollar on speculation inflation in the common- currency region is too strong for the European Central Bank to cut interest rates.
French inflation accelerated in March to the fastest pace in at least 12 years, a government report showed today. The euro stayed higher against the dollar even as a separate report showed investor confidence in Germany unexpectedly fell this month. The pound slid to an all-time low versus the euro amid evidence the U.K. housing slump is the worst since 1978.

EUR/USD traded within the $1.5810/70 range before stabilized at $1.5840. Offers now seen placed to $1.5860 (76.4% $1.5875/1.5815), a break above to open a push back toward the earlier rally highs at $1.5875. Bids remain in place between $1.5815/10.

GBP/USD retreated to session low on $1.9660. Cable bids $1.9660/50, $1.9710/00. Offers $1.9720/30, $1.9750-70.

USD/JPY got support at Y100.80 before bounsed back above the figure. Offers Y101.50, Y102.00, bids Y100.80, Y100.30/00

Apr-08 NY Fed Empire State Survey. At 1300GMT Feb-08 Tsy Intl Capital System is due.

- Q2 seasonal demand drop could be more pronounced on slowing US economy
- OPECleaves 2008 world oil demand growth forecast unchanged at 1.2 mln bpd
- OPEC trims 2008 non-OPEC supply forecast by about 90,000 bpd to 50.28 mln bpd. (OPEC monthly oil report/Rtrs)

The euro traded near a record high against the dollar on speculation inflation in the common- currency region is too strong for the European Central Bank to cut interest rates.
French inflation accelerated in March to the fastest pace in at least 12 years, a government report showed today. The euro stayed higher against the dollar even as a separate report showed investor confidence in Germany unexpectedly fell this month. The pound slid to an all-time low versus the euro amid evidence the U.K. housing slump is the worst since 1978.
Consumer prices in France climbed by an annual 3.5 percent, up from 3.2 percent in February, based on European Union- harmonized methods, Insee, the national statistics bureau, said today in Paris. That's the fastest pace since 1996, when Insee began reporting the data, and matched the euro region's rate.
The ZEW Center for European Economic Research said its index of investor and analyst expectations declined to minus 40.7 from minus 32 in March. Economists expected a gain to minus 30, according to the median of 41 forecasts in a Bloomberg News survey. The gauge reached a 15-year low of minus 41.6 in January.

``The ECB is still very much focused on inflation rather than growth,'' said Henrik Gullberg, a London-based strategist at Calyon, the investment-banking arm of Credit Agricole SA, France's second-largest bank. ``The rate dynamic will continue to push the euro higher.''

EUR/USD: $1.6000

USD/JPY: Y101.00, Y101.50, Y102.80

EUR/JPY: Y160.00

EUR/CHF: Chf1.5600, Chf1.6130

AUS/USD: $0.9305, $0.9245

Resistance 3: Y102.80Resistance 2: Y102.30
Resistance 1: Y101.50
Current price: Y100.91
Support 1: Y100.30

Support 2: Y100.00

Support 3: Y99.40

- Market turmoil having some impact on EMU economy
- Notes changes in G7 line on forex
- Changes in G7 line speak for themselves

Resistance 3: Chf1.0215
Resistance 2: Chf1.0170
Resistance 1: Chf1.0080Current price: Chf0.9983

Support 1: Chf0.9980
Support 2: Chf0.9920

Support 3: Chf0.9870

Comments: Dollar retreats. Break under session low on Chf0.9800 will widen losses to Chf0.9920 and then – to Mar 31 lows near Chf0.9870. Strong resistance is around yesterday’s high on Chf1.0080/00, then – at Chf1.0170 (Apr 09 high).

Resistance 3: $1.9960

Resistance 2: $1.9840

Resistance 1: $1.9760
Current price: $1.9690
Support 1: $1.9660

Support 2: $1.9540
Support 3: $1.9480

Comments: Cable falls, getting close to yesterday’s low on $1.9660. Under the losses may extend to $1.9540 and lower - till $1.9480. Resistance comes at $1.9760. Break above April 10 high at $1.9840 will open a way to $1.9960.

Resistance 3:$1.6000
Resistance 2: $1.5910

Resistance 1: $1.5880

Current price: $1.5842

Support 1: $1.5780
Support 2: $1.5660
Support 3: $1.5510

Comments: Euro consolidates after yesterday’s rally. Resistance comes at session high on $1.5880 (Monday’s high), with a break above will let testing the record high on $1.5915. Support comes at 50% Fibo of yesterday’s rise on $1.5780. Below the downward target is around Monday’s low on $1.5660 and Apr 03 low at $1.5510.

- No reason for exaggerated pessimism

- Germany GDP growth of 1.7% in 2008 realistic

- Don't see major change on trend in expectation

- Markets are relatively nervous.

1. Difficult to assess duration of market turmoil
2. Difficult to assess impact of turmoil on real economy

GBP/USD drops back below $1.9700, from around $1.9715, on release of weaker than expected UK inflation data. Rate declined to $1.9660 as stops triggered below $1.9670. Bids now seen placed toward $1.9650 with more stops noted on a break of $1.9640.

EUR
Bids: $1.5795/90, $1.5770/50
Offers: $1.5895/05

JPY
Bids: Y100.30/00
Offers: Y101.50, Y102.00/20, Y102.80/00
GBP
Bids: $1.9650, $1.9600
Offers: $1.9725/35

AUSSIE
Bids: $0.9200
Offers: $0.9340/50

The euro traded near a record high against the dollar as a German industry report will probably show rising investor confidence, bolstering the case for the European Central Bank to refrain from cutting interest rates. .
The pound fell after the Royal Institution of Chartered Surveyors said the number of residential property agents and surveyors saying prices declined exceeded those reporting gains by 78.5 percentage points in March, down from 65.7 in February.
The yen fell against 14 of the 16 most-active currencies on speculation sovereign wealth funds will step up acquisitions, restoring confidence in holding higher-yielding assets funded in Japan.

EUR/USD consolidated within the $1.5810/30 range before rising to $1.5854.
GBP/USD retreated to session low on $1.9690.
USD/JPY fell from Y101.44 to Y100.90.

The ZEW Center for European Economic Research will say that its index of German investor and analyst expectations rose to minus 30 in April from minus 32 in March, according to a Bloomberg News survey of economists. The gauge reached a 15-year low of minus 41.6 in January.

Japanese stock indices ended Tuesday's session lower, but off the day's worst levels. The benchmark Nikkei 225 was up 73.07 points, or 0.57%, at 12990.58. The broader-based TOPIX was up 9.73 points at 1255.97.

Stock market fixing:
Nikkei 225 -406.22 -3.10% 12,917.51
Topix -32.38 -2.50% 1,246.24
DAX -49.08 -0.74% 6,554.49
CAC -31.44 -0.66% 4,766.49
FTSE 100 -63.90 -1.08% 5,831.60
Dow -23.36 -0.19% 12,302.06
NASDAQ -14.42 -0.63% 2,275.82
S&P -4.51 -0.34% 1,328.32
Light Crude (NYM) May 08 ($US per bbl.) 111.76 +1.62
Gold (CMX) June 08 ($US per Troy oz.) 928.70 +1.70

Japanese stocks fell the most in a month after earnings at General Electric Co. unexpectedly sank and a brokerage downgraded electronics makers, raising concern profits may slow in the U.S., Japan's biggest export market.
Canon tumbled 5%, the steepest fall since March 3. The camera-maker's net income may drop by as much as 35 billion yen ($346 million) in the three months ended March 31, the Nikkei said on April 12. Ricoh Co. sank 4.4% after Nikkei said Japan's second-biggest office equipment maker may have missed its profit target. A Canon spokesman declined to comment on the report, and a representative for Ricoh wasn't available when called by Bloomberg News.
Matsushita fell 4%. Sharp, Japan's largest maker of liquid-crystal displays, slumped 3.8%, the biggest drop since March 17. Nomura cut its rating on both companies to ``neutral'' from ``buy.''
Mitsubishi UFJ lost 3.7%. Sumitomo Mitsui Financial Group Inc., Japan's second largest, plunged 4.2%. Bank of Ikeda Ltd. dropped 4%, the lowest since at least September 1974, after a decline in the value of stockholdings caused an annual net loss of 55 billion yen. The regional bank had earlier forecast a 6 billion yen profit.

European stocks fell for a fifth day after Royal Philips Electronics NV's profit missed analysts' estimates, an unexpected loss at Wachovia Corp. weighed on banks and the Group of Seven finance ministers said prospects for the economy deteriorated.
Philips, Europe's largest consumer-electronics maker, declined the most in a month in Amsterdam after saying earnings slumped 75%. HSBC Holdings Plc led financial firms lower as Wachovia set aside $2.8 billion for credit losses and slashed its dividend. BHP Billiton Ltd., the world's largest mining company, declined with metals prices in London.
Philips dropped 3.3%. Net income fell to 219 million euros ($344.2 million) in the first quarter from 875 million euros a year earlier.
HSBC, Europe's largest bank by market value, fell 1.7%. Credit Suisse Group, Switzerland's second- biggest bank, dropped 3.3%.
Wachovia, the fourth-largest U.S. bank, said it plans to raise capital and slash the quarterly dividend. The first- quarter loss of 20 cents a share compared with earnings of $1.20 a year earlier. Analysts had estimated Wachovia would earn about 40 cents a share in a survey.
Royal Bank of Scotland Group Plc, Britain's third-largest bank, dropped 2.1%. Barclays Plc, the nation's second-biggest bank, dropped 2%.

Stocks slipped Monday, as worries about Wachovia's earnings and the outlook for corporate profits overshadowed any relief about the better-than-expected March retail sales report.
Wachovia reported a quarterly loss of 20 cents per share versus a profit of $1.20 a year earlier. Analysts thought it would report a profit of 40 cents per share. The company also cut its quarterly dividend and said it will raise $7 billion through a share sale. The stock fell 10%.
A variety of financial stocks slumped on the news, including Citigroup, Bank of America and Washington Mutual.

Retail sales were up in March, although rising gas prices and the slumping economy continued to take a toll. Overall sales gained 0.2%, versus a decline in the previous month and above economists' forecasts. Without both auto and gas sales, retail sales were up just 0.1%.
Blockbuster said it will take its unsolicited bid for Circuit City to shareholders after failing to make progress with the company. Blockbuster is offering over $1 billion in an all-cash bid. Blockbuster shares lost 13%, while Circuit City shares jumped 29%.
Delta Air Lines and Northwest are reportedly close to announcing a deal after months of speculation.
U.S. based Manitowoc, a diversified manufacturer is buying food equipment maker Endodis for $2.1 billion. Endodis is listed in the U.K. but operates out of Tampa, Fla.

The dollar fell against the euro Monday after the Group of Seven nations failed to convince investors that they will intervene to prop up the U.S. currency.
The G-7 said on April 11 that the recent ``sharp fluctuations'' in exchange rates risk hurting the global economy, a sign to some traders that it would support the dollar. It was the most significant change in the G-7 statement since the Boca Raton, Florida, meeting in February 2004, when officials cautioned against ``excess volatility.''
The latest statement didn't explicitly mention the dollar or suggest plans for intervention, in which central banks arrange purchases or sales of foreign exchange.

EUR/USD rose to $1.5880, triggering offers near $1.5850/60. Later rate retreated to $1.5800, but later rose back to $1.5845/50.
GBP/USD has got close to $1.9900 after strong inflation data. But position adjustment dragged the pound down to $1.9740.
USD/JPY printed high on Y101.20 before sliding to Y100.60. Recover to Y101.45 was short-lived and dollar refreshed lows near Y100.30.

In Europe the focus will be on UK retail sales report (08:30 GMT) and German ZEW index that may rise to -28.0 versus -32.0.
Later in US attention will be on PPI data and TICS numbers from US Treasury.

Resistance 3: Y102.80
Resistance 2: Y102.30
Resistance 1: Y101.50
Current price: Y101.01
Support 1: Y100.30
Support 2: Y100.00
Support 3: Y99.40
Comments: Dollar retreats. The nearest support comes at Monday’s low on Y100.30 with a break under will widen losses to Y100.00 and Y99.40. Back above Y101.50 will open a way to Y102.30 and resume rebound to Apr 07-09 high on Y102.80.

Resistance 3: Chf1.0215
Resistance 2: Chf1.0170
Resistance 1: Chf1.0080
Current price: Chf0.9988
Support 1: Chf0.9980
Support 2: Chf0.9920
Support 3: Chf0.9870
Comments: Dollar retreats. Break under session low on Chf0.9800 will widen losses to Chf0.9920 and then – to Mar 31 lows near Chf0.9870. Strong resistance is around yesterday’s high on Chf1.0080/00, then – at Chf1.0170 (Apr 09 high).

Resistance 3: $1.9960
Resistance 2: $1.9840
Resistance 1: $1.9760
Current price: $1.9690
Support 1: $1.9660
Support 2: $1.9540
Support 3: $1.9480
Comments: Cable falls, getting close to yesterday’s low on $1.9660. Under the losses may extend to $1.9540 and lower - till $1.9480. Resistance comes at $1.9760. Break above April 10 high at $1.9840 will open a way to $1.9960.

Resistance 3:$1.5915
Resistance 2: $1.5880
Resistance 1: $1.5840
Current price: $1.5832
Support 1: $1.5780
Support 2: $1.5660
Support 3: $1.5510
Comments: Euro consolidates after yesterday’s rally. Resistance comes at session high on $1.5840, stronger – on $1.5880 (Monday’s high), with a break above will let testing the record high on $1.5915. Support comes at 50% Fibo of yesterday’s rise on $1.5780. Below the downward target is around Monday’s low on $1.5660 and Apr 03 low at $1.5510.

High Low Close
EUR/USD 1.5884 1.5668 1.5834
USD/JPY 101.47 100.28 101.12
GBP/USD 1.9892 1.9658 1.9763
USD/CHF 1.0075 0.9926 0.9991

EUR/JPY 160.21 158.21 160.10
EUR/GBP 0.8009 0.7962 0.8008
GBP/JPY 200.76 198.06 199.87
GBP/CHF 1.9832 1.9699 1.9746

Change % Change Last
Nikkei 225 -406.22 -3.10% 12,917.51
Topix -32.38 -2.50% 1,246.24
DAX -49.08 -0.74% 6,554.49
CAC -31.44 -0.66% 4,766.49
FTSE 100 -63.90 -1.08% 5,831.60
Dow -23.36 -0.19% 12,302.06
NASDAQ -14.42 -0.63% 2,275.82
S&P -4.51 -0.34% 1,328.32
Light Crude (NYM) May 08 ($US per bbl.) 111.76 +1.62
Gold (CMX) June 08 ($US per Troy oz.) 928.70 +1.70

06:45 France CPI (March) unadjusted 0.6% 0.2%
06:45 France CPI (March) unadjusted Y/Y 3.0% 2.8%
06:45 France HICP (March) Y/Y 3.3% 3.2%
08:00 Italy CPI (March) final - 0.5%
08:00 Italy CPI (March) final Y/Y - 3.3%
08:00 Italy HICP (March) final Y/Y - 3.6%
08:30 UK HICP (March) 0.6% 0.7%
08:30 UK HICP (March) Y/Y 2.6% 2.5%
08:30 UK Retail prices (March) 0.5% 0.8%
08:30 UK Retail prices (March) Y/Y 3.9% 4.1%
08:30 UK RPI-X (March) Y/Y 3.6% 3.7%
09:00 Germany ZEW economic expectations index (April) -28.0 -32.0
12:30 USA PPI (March) 0.5% 0.3%
12:30 USA PPI (March) Y/Y - 6.4%
12:30 USA PPI excluding food and energy (March) 0.2% 0.5%
12:30 USA PPI excluding food and energy (March) Y/Y - 2.4%
12:30 USA NY Fed Empire State manufacturing index (April) -17.0 -22.2
12:55 USA Redbook (12.04)
13:00 USA TICS (February), bln - 37.4
13:00 USA TICS long-term (February), bln - 62.0