Monday, March 19, 2007

Today's Headlines

- The US and Israel must recognize a Palestinian unity government including Hamas, as the first step toward a peace settlement that would help avoid disaster in the Middle East, billionaire hedge fund investors and left-wing activist George Soros said.
- Crude oil is falling another .35 to $56.75/bbl. as speculators trim bets on rising temperatures and worries over China’s recent interest rate hike.
- US homebuilders turned more cautious this month on concern that buyers will find it harder to obtain loans.
- President Bush said securing Baghdad is the most important mission for the US and asked the public for patience to let his latest strategy work.
- Fidelity Investments plans to introduce performance-based fees for 19 stock funds with $50 billion in assets. Fidelity would earn additional fees of 20 basis points if the funds beat their benchmarks over three years. The funds’ annual management fees would be reduced by 20 basis points if they failed to outperform.
- Community Health Systems(CYH) agreed to pay $5.1 billion for Traid Hospitals(TRI), outbidding a private equity group to create the biggest publicly traded US hospital company.
- John Reade, head of metals strategy at UBS AG’s investment-banking unit in London, expects gold to fall on selling by large speculators.
- Take-Two Interactive(TTWO) delayed its shareholder meeting and said it may sell itself after dissident investors announced plans to seize control of the company.
- Corn prices are falling in Chicago on speculation that US farmers will shift a record number of acres to produce more grain for ethanol.
- Nickel is falling in price after Jinchuan Group, China’s biggest producer, said “crazy” prices will spur higher production. The 41% rise in nickel this year is “madness,” and higher prices have led to “irrational investment” in production, Jinchang, Gansu province-based Jinchuan said. The company controls 90% of nickel output in China, the world’s largest consumer of the metal.
- Politics will trump economics, if necessary, to ensure a rational build out of ethanol across the US, according to Morgan Stanley. The current, substantial, bipartisan political support behind renewable fuels will remain solid at least through the 2008 election, the firm said. Morgan Stanley expects that falling corn prices will cool the food vs. fuel debate.

Wall Street Journal:
- German, Canadian and US auto unions pledged to fight a sale of DaimlerChrysler AG’s(DCX) Chrysler operations to a leveraged-buyout company.
- Leveraged-buyout firms such as Berkshire Partners LLC and Hilco Consumer Capital are investing in fashion designers, in a break from the past, when producers of such luxury goods were shunned.
- US fund firms are seeking to add at least 288 more ETFs.

NY Times:
- Viacom Inc.(VIA/B) is trying to attract Web video advertising accounts, the fastest growing segment on the Internet, as it begins a legal battle with YouTube owner Google Inc.(GOOG).
- Lycos Europe NV, the Internet service partly owned by Bertelsmann AG and Telefonica SA, will begin marketing itself in the US this month with the brand name Jubii.

Washington Post:
- Congress may vote to suspend a standardized test given to children in Head Start programs as part of the Bush administration’s No Child Left Behind initiative. Administration officials have said the test helps determine Head Start programs’ progress.

Investor’s Business Daily:
- Apple Inc.(AAPL) begins shipping its Apple TV video-streaming set-top boxes to retailers tomorrow. Apple TV, retailing for $299 in the US, allows consumers to wirelessly stream video and audio content from personal computers to televisions.

- Japan’s demand for construction materials made from aluminum and its alloys will drop .4% in the year that begins in April, citing the Japan Sash Manufacturing Assoc.

Financial Times:
- Overseas banks may not make a profit on their credit-card and mortgage operations in China for 10 years, a KPMG report said. More than 70 foreign banks have invested billions of dollars over the past five years in China.

Les Echos:
- A “sharp” increase in the French minimum wage will reduce economic growth and result in job cuts, Bertrand Collomb, chairman of Lafarge SA, the world’s largest cement maker said. France’s industrial production can rebound by gaining competitiveness, following the example of Germany’s reforms over the past two years.

Nikkei English News:
- The Bank of Japan’s March quarterly Tanken survey will show business sentiment at the country’s largest manufacturers largely unchanged.

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