DAVE HARRIS: Welcome to Dave On Stocks podcast #64. It's Tuesday July 3^rd 2007. It's a shortened trading day just ahead of the holiday. I'm Dave Harris. I'm a long term investor with a perspective on the market and individual stock advice.

It's been a nice start to the second half of the year so far. The Dow Jones industrials continue to the upside on some positive economic data. According to the Commerce Department, orders at U.S. factories fell by .5 percent in May, but that was less of a decline than expected. This isn't usually a big market mover, but trading volume is low ahead of the 4^th of July holiday. So stocks can be jarred one way or the other easily. Also pending home sales fell more than expected in May to 3.5% from the previous month. That brings pending sales to it's lowest in almost 6 years.

But it looks like the market is focused on the positive, with eyes on a little M&A news. Kraft (KFT) has offered $7.2 billion for the cereal, biscuits and cookie business from French company Groupe Danone (DA). This deal would strengthen Kraft's exposure overseas. Kraft is a buy and I think the stock is going higher. Danone is down by .13 cents to 16.72. Kraft is losing .27 cents at 51.49 per share.

Walgreen (WAG) will purchase specialty pharmacy services company Option Care (OPTN) in a deal worth $850 million. I think this is a great expansion for Walgreens. I maintain my buy rating on WAG. I think it's going to $55. The stock is trading .12 cents higher today at $43.83.

Later in this holiday shortened week, we get initial jobless claims from the Labor Department. On Thursday, Wall Street expects 315,000 claims for the week ending June 30^th. That's a slight increase from 313,000 reported the pervious week. On Friday, it's the big employment report. The market expects about 130,000 non-farm payrolls were added in June. That's down from 157,000 payrolls added in May.

On this shortened trading day, the DOW is up 42.68 points to 13,578.11. The NASDAQ is higher by 9.98 to 2,642.28. The S&P is up 5.09 points to 1524.52. The yield on the 10 year note is higher at 5.04% from 4.99% yesterday.

That's all for today's podcast of Dave On Stocks. Have a great 4^th of July. I'm Dave Harris. Write me with any questions or comments at the "contact us" link on this page. My website is www.daveonstocks.com.