Pre Market

The markets in across Asia and Europe are very bullish.

The big news this morning is the Producer Price Index which is up sharply signaling inflationary pressures and thus treasuries are down and yields are rising in anticipation of a Fed rate hike sometime this year.

Losses in derivatives and widening credit spreads hits Freddie Mac hard.

Goldman Sachs reports increased profits though revenue in its trading and principal investment business was down considerably due to 'continued weakness in the subprime sector'. GS is down in pre market

Bear Stearns is reporting a 10% slump in profts as mounting home loan defaults reduced trading revenue. BSC is down in pre market.

Here is one to watch. Shares of Hoku Scientific HOKU are up over 60% in pre market as the company signs $678 million deal with Suntech Power STP. This small Hawaii based polysilicon maker already has $1 billion in contracts and its current market capitalization is around 75 million prior to todays jump.

Pre market futures are indicating a higher open. I would think the market sells of today as yields rise. Talk of rate hikes is not good for equities.