- Markets opened higher this morning, seeming to recover slightly from yesterday's late sell-off after the Commerce Department reported April inflation was in-line with estimates. Prices Paid data from Chicago PMI was in the higher range, yet markets shrugged off PMI in the aggregate. Crude futures fell below $125 in early trading, providing further good news for equities. In the late morning crude recovered about $127.50 pushing equities lower in tandem. Tech names helped lead markets marginally higher, as DELL+8.7% and MRVL+22.8% were rallying after beating estimates in earnings reports and multiple broker upgrades after the close yesterday. KNTA+61% after Blackbaud announced its intention to acquire the software developer. SIGM-16.2% was one exception in tech, as the company took a hit after guiding lower and getting downgraded at a number of brokers overnight. Solar names ESLR+4.3%, FSLR+8.7%, SPWR+8% and JASO+13% were recovering losses from yesterday after reports that the German government would not cut solar power subsidies as much as anticipated. Shares of UAUA and LCC reacted strongly in pre-market trading after the New York Times reported that the merger talks between the airlines had collapsed. UAUA climbed back into positive territory in early trading after the company's CEO said he would not rule out a merger in the future and noted the airline was close to a deal to bring CAL into its Star Alliance. CIT-5% after Moody's cut the name's senior unsecured credit rating last night; the news helped keep financials under pressure, along with a report out of the Mortgage Insurance Companies of America noting that mortgage defaults rose in April. Retail earnings reports were mixed: TIF+4% after beating estimates and boosting its FY08 guidance this morning, while JCG-20% after guiding below estimates for the coming quarter and the year.

- EUR/USD was holding steady near the 1.5530 level as it consolidated recent gains from the decline in both oil and metal prices. For the moment the dollar is decoupling from the spread between the US-German two-year notes, which has widened -174bps area from -154bps seen on Thursday. Weaker CAD GDP data help push USD/CAD higher towards parity before its retraced towards the 0.9950 area. June Bunds +42 ticks at 112.02; June Gilts +46 ticks at 106.09.