Effectively, the CME is lowering the cost to trade crude oil, gold, silver, copper, and a few other commodities. So far this has had no impact on prices of the SPDR Gold Trust (NYSE: GLD), United States Oil Fund (NYSE: USO), iShares Silver Trust (NYSE: SLV), nor in the iPath DJ-UBS Copper TR Sub-Index ETN (NYSE: JJC).

In the past, margin costs were raised on traders as an effort to curb runaway trading to the upside by making it more expensive for traders and speculators to trade energy and metals.  In short, driving up the cost of poker creates fewer gamblers. So what happens when they make it cheaper to trade?

The full details are here.

JON C. OGG

Fed president Richard Fisher says there is no need for QE3. (Reuters)

Panasonic posts a quarterly loss of $2.6 billion. (Reuters)

Martha Stewart Omnimedia (NYSE: MSO) says a provision in its deal with Macy’s (NYSE: M) would let it move ahead with its new JCPenney (NYSE: JCP) deal. (Reuters)

The U.S. plans to spend $2.8 billion to upgrade the F-16. (Reuters)

The Senate will pass a bill that makes it illegal for members of Congress to engage in insider trading. (WSJ)

Glencore and Xstrata may merge because of the rise in value of natural resources. (WSJ)

Bank “rainy day” funds may be run down by a need to boost earnings. (WSJ)

PetroChina (NYSE: PTR) will buy into Canadian shale assets to ensure future supply. (WSJ)

Corporate profits have risen but the portion paid out in taxes has fallen. (WSJ)

The Government Accountability Office says many hospitals overpay for devices. (WSJ)

The Obama Administration will accelerate the approval of wind farms off the East Coast. (WSJ)

Facebook will push advertisers to use its Sponsored Stories to increase its revenue. (WSJ)

Google (NASDAQ: GOOG) will try to add to the security of its Android mobile-device software to combat hackers. (WSJ)

The head of Dow Chemical (NYSE: DOW) says Europe is in a recession. (WSJ)

New York Times (NYSE: NYT) profits fall as digital revenue fails to grow enough to offset print. (WSJ)

CME Group (NASDAQ: CME) will set an insurance program to help farmers after the collapse of MF Global. (WSJ)

A St. Louis Federal Reserve report shows that startup growth has slowed. (WSJ)

Excess natural gas supplies could cause a price crash in the spring. (WSJ)

The Securities and Exchange Commission allows big banks to avoid some sanctions. (NYT)

The National Institute of Economic and Social Research says the UK will be in recession this year. (NYT)

Greek tax reform has not overcome the nation’s inability to collect taxes. (NYT)

China may put money into the European Stability Mechanism/European Financial Stability Facility to help the region. (FT)

In testimony before Congress, Bernanke expresses concern about the growth of the economy. (FT)

Greece faces more trouble in its effort to remain in the eurozone as its rescue falters. (Bloomberg)

Deutsche Bank will not take European Central Bank loans in a move to protect its reputation. (Bloomberg)

Douglas A. McIntyre

We have two homebuilder earnings due from Beazer Homes USA Inc. (NYSE: BZH) and PulteGroup, Inc. (NYSE: PHM).  Other key earnings to watch will be from the following: Blackstone Group L.P. (NYSE: BX); Boston Scientific Corporation (NYSE: BSX); CME Group Inc. (NYSE: CME); Dow Chemical Co. (NYSE: DOW); Genworth Financial Inc. (NYSE: GNW); Gilead Sciences Inc. (NASDAQ: GILD); International Paper Co. (NYSE: IP); Kellogg Co. (NYSE: K); MasterCard Inc. (NYSE: MA); Merck & Co. Inc. (NYSE: MRK); Royal Caribbean Cruises Ltd. (NYSE: RCL); Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT); Trimble Navigation Ltd. (NASDAQ: TRMB); Vertex Pharmaceuticals Inc. (NASDAQ: VRTX); YRC Worldwide Inc. (NASDAQ: YRCW).

We have included Thomson Reuters consensus estimates on each company.  On most we have included pricing data and/or other bits of color for traders to consider.

We have two different homebuilders on deck to report.  Beazer Homes USA Inc. (NYSE: BZH) is expected to post -$0.36 EPS on $211.4 million in sales and we would watch cancellation rates on contracts as well as the quality of the earnings.  Second is PulteGroup, Inc. (NYSE: PHM) with an expected positive earnings of $0.07 EPS on $1.14 billion in sales.  Pulte’s cancellation rates and quality of earnings will also have to be monitored.

Blackstone Group L.P. (NYSE: BX) will show private equity wealth and earnings in the morning.  The firm is expected to report earnings of $0.38 EPS on revenues of $986.75 million.

Boston Scientific Corporation (NYSE: BSX) has been down and out for longer than any current and past holder would like to consider.  Thomson Reuters has estimates of $0.08 EPS on $1.91 billion in sales.

CME Group Inc. (NYSE: CME) is expected to report earnings of $3.71 EPS and $754 million in sales before the market opens.  With a possibility of a state-relocation and the ongoing pressure of exchange mergers we would be watching this one.  At roughly $244.50, the 52-week trading range is $224.69 to $317.27.

Dow Chemical Co. (NYSE: DOW) is expected to turn in earnings of $0.30 EPS on $14.19 billion in sales.  The report is due in the morning.

Genworth Financial Inc. (NYSE: GNW) is expected to report earnings of $0.19 EPS on $2.58 billion in sales.  The shares are now up over 60% from the lows of the last year and the stock still remains pressured due to the mortgage insurance overhang that has been in place for quite some time.

Gilead Sciences Inc. (NASDAQ: GILD) has shocked the market by outperforming despite what appears to be a bad use of effort and capital in the large acquisition.  Still, shares hit a new 52-week high on Wednesday.  Thomson Reuters has estimates of $1.05 EPS and $2.18 billion in sales. 

International Paper Co. (NYSE: IP) is close to being within striking range of a 52-week high and it pays well above a 3% yield today.  Thomson Reuters has estimates of $0.61 EPS and $6.5 billion in sales.

Kellogg Co. (NYSE: K) is lagging and actually close to a 52-week low with shares around the $49.50 mark. The estimates are $0.63 on $2.99 billion in sales.  The bar is set very low here.

MasterCard Inc. (NYSE: MA) will show just what the interchange fee problems look like, but that is not fully reflected at all in current numbers.  The consensus estimates are $3.92 EPS and $1.73 billion in sales. With shares around $357 some are concerned over valuations here.

Merck & Co. Inc. (NYSE: MRK) is reporting early Thursday morning and the company’s higher dividend hike has shares trading very close to 52-week highs with a price of close to $38.70 andf a 52-week range of $29.47 to $39.43.  Estimates are $0.95 EPS and $12.53 billion in sales. To show just how low growth is the estimates of $3.76 EPS and $48.23 billion in sales for all of 2011 are only expected to be $3.83 EPS on $47.62 billion in sales for all of 2012.

Royal Caribbean Cruises Ltd. (NYSE: RCL) may or may not release.  With its rival’s disaster, we are not doing much legwork here.  Thomson Reuters has a projection of $0.15 EPS and $1.78 billion in sales.

Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT) is key for hotel investors and this one is expected to post $0.57 EPS on $1.42 billion in sales. Starwood has over $1 billion in cash but is still trading at a high 3.7-times book value.

Trimble Navigation Ltd. (NASDAQ: TRMB) is not so widely watched on its own, but it is used as a barometer reading for Garmin.  Trimble estimates are $0.48 EPS and $419.10.

Vertex Pharmaceuticals Inc. (NASDAQ: VRTX) has been in the news with new FDA approvals.  We have Thursday as the tentative date and estimates are $0.73 EPS and $523.66 million in sales.

YRC Worldwide Inc. (NASDAQ: YRCW) is set to report and it is a puzzlement as to how this stock is still alive.  On a reverse split basis the $12.83 price compares to a 52-week range of $7.94 to somewhere over $1,000.  The consensus is listed as -$6.97 EPS but we have no idea how these targets are composed on this company.

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JON C. OGG

Accounting problems at Olympus may make it a takeover target. (Reuters)

Italian bond yields hit a eurozone record. (Reuters)

Avon Products (NYSE: AVP) replaces its CEO. (Reuters)

China vows to keep its economy growing despite difficulties elsewhere. (Reuters)

HTC says a ruling on IP issues with Apple (NASDAQ: AAPL) has been delayed. (Reuters)

The euro hits an 11-month low. (WSJ)

Olympus restates earnings. (WSJ)

Best Buy (NYSE: BBY) earnings come in below expectations, due in part to competition with Amazon.com (NASDAQ: AMZN). (WSJ)

General Electric (NYSE: GE) will find its earnings undermined in Europe. (WSJ)

The head of AMD (NYSE: AMD) plays down parts shortages after Intel (NASDAQ: INTC) warns on earnings. (WSJ)

The National Transportation Safety Board calls for a ban on cellphone use and text devices in cars. (WSJ)

A fight about payroll taxes delays the federal budget bill. (WSJ)

California must make $981 million in mid-term budget cuts. (WSJ)

Chrysler’s CEO says the company could make a $3 billion operating profit next year. (WSJ)

Morgan Stanley (NYSE: MS) must return about $700 million to investors in its flagship global real-estate fund.  (WSJ)

MBIA (NYSE: MBI) will pay Morgan Stanley $1.1 billion to settle allegations of selling guarantees on real estate. (WSJ)

Commerzbank may have too small a capital reserve if eurozone financial problems worsen. (NYT)

The Organisation for Economic Co-operation and Development says members must defend internet freedoms. (NYT)

International Monetary Fund officials urge more austerity for Greece. (NYT)

EU officials say the a new treaty already is beset by political arguments. (FT)

GE’s Immelt says the company could have double-digit growth if its industrial operations do well. (FT)

EBay’s (NASDAQ: EBAY) PayPal will challenge Groupon (NYSE: GRPN) and LivingSocial. (Bloomberg)

Members of OPEC, including Iran and Saudi Arabia, agree the group should set a production ceiling of 30 million barrels a day.  (Bloomberg)

Douglas A. McIntyre

Oil Production

OPEC probably will keep oil production where it is now — at 30 million barrels a day. If so, this production will stay near three-year highs. OPEC likely will make the decision because of the faltering global recovery. The cartel understands that a sharp spike in crude prices could help drive the developed world back into a recession, a situation that would be unfavorable to demand levels — and OPEC’s sales — almost immediately.

Apple’s Papers

The documents signed to create Apple (NASDAQ: AAPL) on April 1, 1976, sold at auction for $1.6 million. With the recent death of founder Steve Jobs and Apple’s huge success, it is amazing the price did not go higher. The papers were part of the beginning of Apple and were signed by Jobs and cofounders Steve Wozniak and Ronald Wayne. The $1.6 million is certainly a good investment. Apple, now the most valuable company in the world by market cap, has not lost the cultlike following it had when Jobs was alive. Anything tied to its earliest days likely will grow in value.

Lumia Tested

An effort to bring Nokia (NYSE: NOK) back from near death in the smartphone sector reached another milestone. Its Lumia 800 handset was tested in the laboratories of carriers AT&T (NYSE: T) and Verizon Wireless. The Lumia will be the first widely distributed smartphone to run Microsoft (NASDAQ: MSFT) Windows mobile OS. The alliance between Nokia and Microsoft calls for an investment of billions of dollars in marketing and R&D. The Lumia’s greatest advantage is that it will run on superfast 4G LTE networks in the U.S. These networks have attracted customers who want rapid speed for downloads and to view multimedia.

Douglas A. McIntyre

The company issued a one sentence press release this morning saying, “MF Global today confirmed that the New York Federal Reserve has suspended MF Global’s designation as a primary dealer.”

• UPDATE: After 10:15 AM EST reports were coming out that MF Global is filing for Chapter 11 under bankruptcy protection. 

Now there are reports that MF Global traders are not being allowed to access the CME trading floor by CME Group Inc. (NYSE: CME) and additional reports that IntercontinentalExchange, Inc. (NYSE: ICE) is only allowing close-out transactions to be made by MF Global traders.

This is unfortunately one of those situations where a company is dying on the vine.  If financial firms cannot transact business, they are out of business.

Former New Jersey governor Jon Corzine was shown over the weekend to be instrumental in the bets that have brought the firm down.  Killing a big public financial company won’t be a great thing for what was otherwise a great career.

JON C. OGG

Copper prices have dropped by more than $1/pound from around $4.50/pound at the beginning of August. CME raised the copper margin by 18% on September 24th, so this is the second rise in just over two weeks. At the same time as the last rise, CME also raised the margin requirements on gold by 21% and silver by 16%. CME’s rationale for raising margin requirements is based on what it calls a “normal review of market volatility to ensure adequate collateral coverage.”

CME’s move has probably played a part in lifting copper mining stocks Freeport-McMoran Copper & Gold (NYSE: FCX) and Southern Copper (NYSE: SCCO), as well as gold miners Newmont Mining (NYSE: NEM) and Barrick Gold (NYSE: ABX), and silver miner Silver Wheaton (NYSE: SLW).

If copper margins are rising today, can requirements on gold and silver be far behind? The margin requirement for a speculative trader to open a position on a 100-ounce gold contract is $11,475. At today’s price of around $1,648/ounce, that is just 7% of the value of the contract.

The margin requirement for a speculative 5,000-ounce silver contract is $24,875. At today’s silver price of nearly $32/ounce, the value of a contract is $160,000. That calculates to a margin requirement of about 15.5%.

The rise in margin requirements last month put a damper on prices for all three of the metals. That is not happening with copper today, as the price is up nearly 5%. The news that the European Central Bank is offering essentially unlimited additional emergency loans to eurozone banks is putting some air under all markets today, and the commodities markets are not excepted.

Still, there is a nearly certain chance that CME will lift its gold and silver margin requirements again. The margin on gold contracts seems particularly out of kilter given the 15% requirement for both silver and copper. But if today’s market reaction is any indication, margin requirement increases do not play as big a role in metals trading as might be thought.

Freeport’s shares are up about 1.5%, at $34.97, in a 52-week range of $28.85 – $61.35. Southern Copper’s shares are up nearly 2.5%, at $27.04, in a 52-week range of $22.58 – $50.35. The iPath DJ-UBS Copper Total Return Subindex ETN (NYSE: JJC) is up nearly 3%, at $41.95, in a 52-week range of $38.99 – $61.69.

Gold miner Newmont’s shares are up about 0.5%, at $63.33, in a 52-week range of $50.05 – $71.25 and Barrick’s shares are up about 1.5%, at $46.98, in a 52-week range of $42.50 – $55.95. The SPDR Gold Trust (NYSE: GLD) is up about 0.2%, at $159.74, in a 52-week range of $127.80-$185.85. The Market Vectors Gold Miners ETF (NYSE: GDX) is up about 0.7%, at $55.28, in a 52-week range of $50.42 – $66.98. The Market Vectors Junior Gold Miners ETF (NYSE: GDXJ) is up more than 3.5%, at $29.21, in a 52-week range of $25.22 – $44.86.

Silver Wheaton shares are up about 5%, at $30.81, in a 52-week range of $25.35 – $47.60. The iShares Silver Trust (NYSE: SLV) is up more than 3.5%, at $30.75, in a 52-week range of $21.97 – $48.35. The Global X Silver Minters ETF (NYSE: SIL) is up nearly 4.5%, at $21.93, in a 52-week range of $18.74 – $31.34.

Paul Ausick

EU markets to decline more this quarter than in any other since 2008. (Reuters)

Bank of America (NYSE: BAC) to charge debt card fees. (Reuters)

Amazon’s (NASDAQ: AMZN) new Fire tablet raises worry about profit margins and the supply chain. (Reuters)

Facebook faces more pressure over its privacy policies. (Reuters)

Oracle (NASDAQ: ORCL) says the CEO of Autonomy shopped his company around, beginning a battle that could harm Hewlett-Packard (NYSE: HPQ), which plans to buy the smaller company. (Reuters)

The Federal Reserve’s Operation Twist could do more for the financial markets than QE2. (WSJ)

A vote by the German parliament will clear the way for bailout funds the region needs to support weaker economies. (WSJ)

Friendly’s restaurant chain may file Chapter 11. (WSJ)

Leo Apotheker to get $7.2 million severance from HP and Meg Whitman will take $1 salary. (WSJ)

Research In Motion (NASDAQ: RIMM) may have trouble breaking with its old target market of companies. (WSJ)

The index of pending home sales falls again. (WSJ)

The FAA to increase co-pilot training. (WSJ)

The IMF may try to expand its lending power to $1.7 trillion. (WSJ)

Ford (NYSE: F) and General Motors (NYSE: GM) may get back their investment grade ratings from S&P. (WSJ)

The DJIA and S&P 500 could become a joint venture between McGraw-Hill (NYSE: MHP) and CME (NASDAQ: CME). (WSJ)

PIMCO moves out of risky assets and into high-quality investments like emerging-market debt. (WSJ)

The U.S. may sell $22 billion in assets over the next 10 years to raise cash. (NYT)

The inspector general for TARP says that some big banks, like Bank of America and Citigroup (NYSE: C), were pressured to leave the program too soon. (FT)

Toyota (NYSE: TM) and Honda (NYSE: HMC) return to full production for the first time since the Japanese earthquake. (Bloomberg)

IBM’s (NYSE: IBM) market cap rises above Microsoft’s (NASDAQ: MSFT) for the first time since 1996. (Bloomberg)

Douglas A.McIntyre

The CBSX has now entered into a definitive agreement to acquire the NSX to expand the CBOE footprint.  In the release, it states that the CBSX will operate the NSX as a separate exchange but it will have savings from consolidating its data systems and its business operations.  While the deal is subject to SEC approval, this exchange merger  is tiny compared to acquisitions and mergers in exchanges.  The CME Group Inc. (NYSE: CME), NYSE Euronext, Inc. (NYSE: NYX), NASDAQ OMX Group (NASDAQ: NDAQ) and others have all made far larger acquisitions in the world of exchanges.

The CBOE offers trading in more than 7,600 equities and exchange traded funds listed on exchanges in the U.S. and the NSX has offices in Jersey City, New Jersey and in Chicago. If you look at the NSX equity trading volumes just for September, it looks as though the exchange averages more than 40 million shares per day. It noted that the September 22 trading data was 273,773 trades representing some 63,438,371 shares.  The September 16 trading data showed ‘only’ 170,684 trades but with a trading volume 90,568,375 shares.

CBOE shares are down 0.5%% at $26.21 on the news today and the 52-week trading range is $19.60 to $29.77.  Keep in mind that the CBOE has only been public since summer of 2010, and back then it was trading at just over $30.00 per share.

It is too soon to tell how this will alter Wall Street profit and sales targets.  Thomson Reuters currently has estimates of $1.53 EPS on sales of just over $510 million for 2011, but the deal is not expected to close until the fourth quarter.  The 2012 estimates are $1.74 EPS on about $557 million in sales.  Thomson Reuters also has a consensus price target of almost $26.50 on the stock.

JON C. OGG

Several large pharma firms are in the early stages of an attempt to find new and more effective cholesterol drugs. (Reuters)

The Swiss franc begins to fall. (Reuters)

Amazon (NASDAQ: AMZN) may ship 3.5 million Kindles in the fourth quarter, says industry research firm. (Reuters)

Hewlett-Packard (NYSE: HPQ) to spin off its PC unit. (Reuters)

Zynga’s IPO is delayed. (Reuters)

Alan Krueger, new head of the White House Council of Economic Advisers, to press for more efforts to help create jobs. (Reuters)

General Motors (NYSE: GM) to launch a new Chevy Malibu, an attempt at a higher-mileage car. (WSJ)

Larry Page, Google’s (NASDAQ: GOOG) new CEO, has trouble as he looks for new direction for the company. (WSJ)

Bank of America (NYSE: BAC) sells half of its stake in China Construction Bank  for $8 billion. (WSJ)

Consumer spending rises more than expected in July. (WSJ)

A consumer group wants the FDA to press generic firms to disclose more dangers about drugs. (WSJ)

LG Display (NYSE: LPL) to cut its capex investment. (WSJ)

The European Central Bank may reconsider its stand on inflation and keep rates low. (WSJ)

The price of damages from Irene may hit $12 billion. (WSJ)

China once again tightens rules on bank loans. (WSJ)

Italy may expand the cuts in its austerity package. (WSJ)

The government in Brazil to lower spending and press for lower bank interest rates to bring down inflation. (WSJ)

UAW members press their president to get them a better deal with the Big Three. (WSJ)

Macarthur Coal  probably will accept a higher $5.12 buyout offer from Peabody Energy (NYSE: BTU) and ArcelorMittal. (WSJ)

Truck makers Volvo and Scania to prepare aggressively for another economic slowdown. (WSJ)

The largest car company in China, SAIC Motor, shows a sharp rise in profits. (WSJ)

CME Group (NASDAQ: CME) to postpone the trading of yuan futures. (WSJ)

Alpha Bank and Eurobank, two large Greek banks, to merge. (NYT)

The UAW wants Detroit to raise entry level pay. (NYT)

The IASB takes a dim view of how banks handled accounting for renegotiated Greek debt. (FT)

The confidence index of UK companies drops sharply. (Bloomberg)

India’s economy grows more than expected. (Bloomberg)

Douglas A. McIntyre