For Week Ended April 29th 2011

CAT Powered the Dow

CAT led the Dow 30 stocks higher, taking the Dow Jones Industrial Average to yet another advance
on Friday. The index settled at 12,810.54, up 47.23 points or 0.37% higher while S&P 500 index
edged 3.13 points higher or 0.23% up to 1,363.61. Tech-heavy NASDAQ composite ended the day
at 2,873.54, up 1.01 points or 0.04% higher.

Top gainers of the day were CAT (+2.46%), BA (+1.57%) and INTC (+1.54%) while the top losers
were MSFT (-2.96%), VZ (-1.28%), and BAC (-1.13%).

As for the weekly scores, INTC topped the table as it gained 7.88% followed by PFE (+5.96%) and
BA (+5.75%). Languishing at the bottom this week were HD (-1.72%), HPQ (-1.51%), and KO (-
0.62%).

For the entire month of April, INTC and JNJ delivered double-digit gains of 14.72% and 10.92%,
respectively, while MRK soared 8.91%. As CSCO moved out of the red, the weakest link has been
passed to BAC. The bank lost 7.88% in April, erasing all gains made so far this year and at the
moment is 31.13% below its price 12 months ago. AA saw a 3.74% fall in April, making it the second
worst performer of the Dow 30. VZ was next as it shed 1.97% in April.

As the fourth month ends, three stocks have been delivering more than 20% of gains this year: CAT
with 23.22% of gains, BA with 22.25% of increase and XOM with a rise of 20.32%. Another 12
stocks also performed well, yielding double-digit gains in 2011. Only 5 poor stocks got buried at the
bottom of the table: CSCO (-13.4%), BAC (-7.95%), MSFT (-7.13%), and HPQ (-4.11%). Despite it
also stuck in the red (-0.25%), MRK has seen a stellar improvement lately, however.

Longer-term, that is 12-month evaluation basis, the same lineup fills the bottom: CSCO (-34.94%),
BAC (-31.13%), HPQ (-22.32%) and MSFT (-15.13%). CAT rules this criteria with a return of 69.5%
in 12-month period, followed by DD (+42.55%), and IBM (+32.23%).

April has come to a close. Next comes May, a month when the stocks are relatively weak. They say,
‘Sell in May and go away’. Although May has been traditionally weak, but we can not rule out that
this time the Fed is still being generous with its QE2, quarterly earnings have been relatively solid,
and it’s still a long time until the Fed starts to raise interest rates.

In the commodity front, gold soared higher on Friday as the market took Bernanke’s statement earlier
after the FOMC meeting as an assurance that there will be no increase in interest rates in the horizon,
yet. Spot gold finished at $1,563.30 an ounce, up 1.8% after it touched its new record high at
$1,569.30. The futures contract for June delivery also soared, hitting $1,556.40 an ounce by the end
of the day, up 1.7%. Silver slipped 0.8% lower at $48.03 an ounce, however.

1 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

The black gold also advanced on Friday. US light crude futures for June delivery ended up $1.07 or
1% to $113.93 a barrel. Meanwhile, Brent crude futures for June settlement ended at $125.89 a
barrel, up 0.7% or 87c.

In the corporate front, DD has raised its bid for Danisco as the shareholders at Danisco complained
that DD’s initial offer was too low. DD raised the bid to $6.64B, or up 5% than the initial offer.

US economic data boosted the market’s sentiment as well as supporting the oil prices. In March,
consumer spending was reported up by 0.6%, beating the consensus of a rise by 0.5%.

Overall, April was superb except for several underperformers.

Week Ahead
Next week will feature earnings coming from PFE and KFT, while the economic front will again,
present us with the US nonfarm payrolls data. In April, the US economy is seen to have added 188K
more jobs. This will be lower than the March’s figures of 216K. While lower, a figure nears 200K
should be seen as good for the economy. ADP employment number will provide an early clue when it
is released on Wednesday. The market expects the ADP number at 193K, not too distant from its
201K gains in March. Auto enthusiasts may focus on US auto sales as the number is seen stable at
13.1 million units.

US economic progress could also be seen from two key gauges: ISM – which is seen edging down to
59.9 from 61.2, and ISM for nonmanufacturing which is seen up to 58.5 from 57.3. Construction
spending and factory orders figures are also seen positive as spending is seen up 0.2% after
slumping 1.4% in February while orders are expected to grow by 2.3% in April after declining 1.4%
in March.

Well, this just in: US has confirmed that Osama bin Laden has been killed in the US military operation.
The US stock futures turns higher on the news and this should bring a positive start for Monday.

2 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Earnings Review
CAT

Revenues in billions of Earnings Per Share

dollars Previous Consensus Actual
Previous Consensus Actual $1.84
$12.95 $1.30
$11.40
$8.24
$0.36

Revenues EPS

CAT had a blowout quarter after reporting its 1Q net profit more than climbing fivefold. For its
outlook in the coming quarter, CAT raised its 2011 EPS to $6.25-$6.75, while the consensus forecast it
at $6.25. The earthquake in Japan is seen providing negative impact on the company’s sales, which
may be around $300 million. Operating profit however, is seen impacted by the quake at around
$100 million. CAT reported order backlog of $20.8B, some 11% higher during the quarter. Capital
expenditures are seen at $3B this year, and more than half of it coming from the US, indicating
positive short-term economic outlook in the US.

CVX

Revenues in billions of Earnings Per Share

dollars Previous Consensus Actual
Previous Consensus Actual $0.92
$0.83
$11.58

$11.42
$11.38
$0.09

Revenues EPS

CVX topped the consensus net profit in its 1Q earnings report, with its downstream earnings coming in
$622M, jumped from $196M a year earlier. Upstream earnings of the oil giant also improved from
$4.72B last year to $5.98B. Production however, was down 2.78M barrels in the quarter. Elsewhere
in Moccasin well, CVX plans to resume its work there in the Gulf of Mexico. For the current quarter,

3 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

CVX raises share repurchases for $1B in the quarter. CVX sold its oil at the average price of $95,
sharply higher than $70 a year before in the international markets, but in the US the company sold its
oil at an average of $89 a barrel, up from $71 a year ago.

MRK

Revenues in billions of Earnings Per Share

dollars Previous Consensus Actual
Previous Consensus Actual $0.92
$0.83
$11.58

$11.42
$11.38
$0.09

Revenues EPS

MRK beat both expectations on EPS and revenues regarding its 1Q performance. The EPS shown
above has excluded the legal settlement costs with JNJ and also excluded the Schering-Plough deal.
For the entire 2011 financial forecast, EPS for FY11 is seen between $2.04 and $2.39 per share with
adjusted earnings are seen within the range of $3.66 to $3.76 per share. Prior forecast was between
$3.64 and $3.76 per share. Notable item was the sales of Cozaar/Hyzaar, MRK’s high blood
pressure medication, which fell 46% to $426 million. Poor sales also came from Temodar which fell
10% to 248 million. MRK’s new drugs Singulair, Januvia and Janumet were all up 14%, 45%, and
52%, respectively.

4 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Stock Focus: Pfizer, Inc.

PFE
Last Apr 29th Resistances 21.06 21.96 22.56 22.74 23.73
$20.97 0.67% Supports 20.58 20.28 20.03 19.79 19.49
WTD MTD Outlook
5.96% 3.25% POSITIVE
YTD 12-Month Price Tgt
19.76% 25.42% $22.74

PFE is back on track to meet its objective at $22.74 which I mentioned a month ago. The technical
indicators are supportive to this POSITIVE outlook, with EMAs rising as well as the MACD which has
flipped into the positive area. RSI is still below the overbought area, thus indicating ample space to
move higher. PFE is also one of Dow 30’s best performers so far this year, gaining 19.76%. The drug
giant is scheduled to deliver its earnings this week.

5 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Stock Index Focus: Dow Jones Industrial Average

DJIA
Last Apr 29th Resistances 12832.83 12858.38 12989.34 13113.20 13542.73
12,810.54 0.37% Supports 12685.08 12593.80 12506.22 12446.05 12263.55
WTD MTD Outlook
2.44% 3.98% POSITIVE
POSITI
YTD 12-Month Price Tgt
10.72% 16.37% 12,989.34

The DJIA index has broken above 12,800 mark and the rally does not seem to be subsiding so far.
Technical indicators are bullish with EMAs rising along with MACD, despite the RSI is entering the
overbought zone. For now, it retains its POSITIVE outlook with target set at around 12,989.34. As we
enter the month of May, we should approach cautiously on this relatively weak month. EMA at
12,263.55 should contain major pullbacks as the index heading towards the target.

6 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Stock Index Focus: Nasdaq Composite

NASDAQ
Last Apr 29th Resistances 2879.17 2918.55 2922.82 2993.44 3049.60
2,873.54 0.04% Supports 2840.51 2820.77 2815.55 2808.55 2766.64
WTD MTD Outlook
1.89% 3.32% POSITIVE
POSITI
YTD 12-Month Price Tgt
7.91% 16.75% 2,918.55

Tech stocks are not as aggressive as DJIA and S&P 500, but it also retains its POSITIVE outlook
nevertheless. While the MACD is rising and the EMAs are also on the rise, RSI has entered into the
overbought area and this requires caution. The index however, is aiming for 2,918.55 where this
resistance is adjacent to another one at 2,922.82, indicating a strong resistance area.

7 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Stock Index Focus: S&P 500 Index

S&P 500
Last Apr 29th Resistances 1374.26 1385.11 1400.70 1420.12 1440.98
1,385.11 0.23% Supports 1317.93 1331.47 1337.55 1339.46 1344.07
WTD MTD Outlook
1.96% 2.85% POSITIVE
POSITI
YTD 12-Month Price Tgt
8.41% 14.91% 1,385.11

Similar story with DJIA and NASDAQ indexes, S&P 500 index is also on the rise, gunning for
1,385.11. Caution also needs to be applied here as the RSI is just within spitting distance with the
overbought area. EMAs and MACD are all on the rise as well, but as we can see with the MACDs on
all DJIA, NASDAQ and S&P 500 charts, MACDs have not made a higher high despite the prices have.
This is the chief concern at the moment as this could form a bearish divergence.

8 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Earnings Preview: PFE

Revenues in billions of Earnings Per Share

dollars FSet TReuters Previous
FSet TReuters Previous
$0.60
$16.75
$0.59
$16.65
$16.61 $0.58

Revenues EPS

Next on the earnings front is PFE which will release its report on May 3rd. Generally, the polls point at
a reduced performance by the drug manufacturer, both in revenues and in EPS. PFE bought King
Pharmaceuticals Inc. last month for $3.6B, while the company also eyes on expanding to the Chinese
market by forging cooperation with Shanghai Pharmaceutical Co. Ltd. As the drug patent expiration
on its Lipitor looms large, the market may want to see any updates on the company on subsequent
quarters. Cost control is also bound to be under the microscope.

Analysts' Upgrades & Downgrades

Code House Ratings PT
BA Citigroup Buy $84 $90
BA HSBC Underweight NEUTRAL -
JNJ UBS KG Buy $67 $72
MRK Hapoalim Hold BUY -
MSFT Davenport Neutral BUY -
MSFT Deutsche Bank Buy $35.00
MSFT FBR Capital Market pefrom $30 $28
MSFT UBS AG Buy $35 $32
PG Deutsche Bank Hold BUY $70 $72
PG Morgan Stanley Overweight $72.00
VZ Citigroup Buy HOLD $88 $91
n Reiterate n Upgrade n Downgrade n Initiation

9 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

Price Performance - as of Apr 29th 2011

Code Last Dy WTD MTD YTD 12-Mos
AA 17.00 -0.53% 0.18% -3.74% 10.46% 26.58%
AXP 49.08 1.15% 4.18% 8.58% 14.35% 6.42%
BA 79.78 1.57% 5.75% 7.91% 22.25% 10.15%
BAC 12.28 -1.13% -0.24% -7.88% -7.95% -31.13%
CAT 115.41 2.46% 5.47% 3.65% 23.22% 69.50%
CSCO 17.52 1.33% 3.42% 2.16% -13.40% -34.94%
CVX 109.44 0.58% 1.21% 1.81% 19.93% 34.38%
DD 56.79 0.07% 1.57% 3.31% 13.85% 42.55%
DIS 43.10 0.19% 1.96% 0.02% 14.90% 16.99%
GE 20.45 -0.73% 2.51% 2.00% 11.81% 8.43%
HD 37.15 -0.85% -1.72% 0.24% 5.96% 5.45%
HPQ 40.37 -0.39% -1.51% -1.46% -4.11% -22.32%
IBM 170.58 -0.12% 1.37% 4.61% 16.23% 32.23%
INTC 23.15 1.54% 7.88% 14.72% 10.08% 1.36%
JNJ 65.72 0.52% 2.58% 10.92% 6.26% 2.21%
JPM 45.63 -0.48% 2.13% -1.02% 7.57% 7.16%
KFT 33.59 -0.03% 0.63% 7.11% 6.60% 13.48%
KO 67.46 0.07% -0.62% 1.69% 2.57% 26.21%
MCD 78.31 0.36% 1.82% 2.92% 2.02% 10.94%
MMM 97.21 -0.02% 3.50% 3.97% 12.64% 9.63%
MRK 35.95 0.50% 5.61% 8.91% -0.25% 2.60%
MSFT 25.92 -2.96% 1.57% 2.09% -7.13% -15.13%
PFE 20.97 0.67% 5.96% 3.25% 19.76% 25.42%
PG 64.90 0.62% 2.58% 5.36% 0.89% 4.41%
T 31.12 -0.80% 1.43% 1.67% 5.92% 19.42%
TRV 63.28 0.35% 3.20% 6.39% 13.59% 24.71%
UTX 89.58 0.64% 2.85% 5.82% 13.80% 19.52%
VZ 37.78 -1.28% 2.36% -1.97% 5.59% 30.73%
WMT 54.98 0.53% 2.61% 5.63% 1.95% 2.50%
XOM 87.98 0.73% 1.88% 4.58% 20.32% 29.82%

10 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)
 For Week Ended April 29th 2011

US Economic Calendar
Date Time Report Period Actual Forecast Previous
25-Apr 10:00 AM New home sales Mar 300K 290K 270K
26-Apr 9:00 AM Case-Shiller home prices Feb -1.1% - -1.0%
26-Apr 10:00 AM Consumer confidence Apr 65.40 65.0 63.8
27-Apr 8:30 AM Durable goods orders Mar 2.5% 3.0% -0.6%
27-Apr 8:30 AM Core equipment orders Mar 3.7% - -0.7%
27-Apr 12:30 PM FOMC statement
28-Apr 8:30 AM Jobless claims 23-Apr 429K 395K 404K
28-Apr 8:30 AM GDP Q1 1.8% 1.7% 3.1%
28-Apr 10:00 AM Pending home sales Mar 5.1% - 2.1%
29-Apr 8:30 AM Personal income Mar 0.5% 0.3% 0.4%
29-Apr 8:30 AM Consumer spending Mar 0.6% 0.5% 0.9%
29-Apr 8:30 AM Core PCE Price Index Mar 0.1% 0.1% 0.2%
29-Apr 8:30 AM Employment cost index Q1 0.0 0.5% 0.4%
29-Apr 9:45 AM Chicago PMI Apr 67.8% 68.0% 70.6%
29-Apr 9:55 AM Consumer sentiment Apr 69.8 70.0 67.5

US Economic Calendar
Date Time Report Period Actual Forecast Previous
2-May 10:00 AM ISM Apr 59.9 61.2
2-May 10:00 AM Construction spending Mar 0.2% -1.4%
3-May 10:00 AM Factory orders Apr 2.3% -0.1%
3-May TBA Motor vehicle sales Apr 13.1 mln 13.1 mln
4-May 8:15 AM ADP employment Apr 193K 201K
4-May 10:00 AM ISM nonmanufacturing Apr 58.5 57.3
5-May 8:30 AM Jobless claims 30-Apr 425K 429K
5-May 8:30 AM Productivity 1Q 2.1% 2.6%
5-May 8:30 AM Unit labor costs 1Q 0.8% -0.6%
6-May 8:30 AM Nonfarm payrolls Apr 188K 216K
6-May 8:30 AM Unemployment rate Apr 8.8% 8.8%
6-May 8:30 AM Avg hourly earnings Apr 0.3% 0.0%
6-May 3:00 PM Consumer credit Mar $5.0B $7.6B

Disclaimer: This report is provided for information purposes only. It is not an offer to sell or to buy any securities. This
report has been prepared based on sources believed to be reliable, but there is no assurance or guarantee regarding its
completeness and accuracy. The author accepts no responsibility or liability arising from any use of the report.

11 .DJI 12,810.54 (+47.23 ● +0.37%) .SPX 1,363.61 (+3.13 ● +0.23%) .IXIC 2,873.54 (+1.01 ● +0.04%)