Today's Headlines

Bloomberg:
- Citadel Investment Group LLC took over Sowood Capital Management’s credit holdings after the Boston-based hedge-fund manager suffered losses on corporate bonds and loans.
- Morgan Stanley’s(MS) credit rating was raised one level to AA- from A+ by S&P, which said improvements in the firm’s “competitive position” will enable it to ride out market declines.
- HSBC Holdings(HBC), the world’s fourth-largest bank and one of the first to warn of sub-prime problems, said first-half profit rose 25%, beating analysts’ estimates.
- Gasoline futures fell again before a weekly Energy Dept. supply report that may show a second consecutive inventory increase during the heart of driving season.
- Rupert Murdoch’s News Corp.(NWS/A) said it is “highly unlikely” to proceed with a $5 billion bid for Dow Jones(DJ) without more support from the publisher’s controlling Bancroft family. Dow Jones shares plunged as much as 9.1%.
- China’s government curbed bank lending for a sixth time this year to cool the economy after the fastest expansion since 1994.

Wall Street Journal:
- The US Pension Protection Act of 2006, which allows automatic enrollment of workers into 401(k) retirement plans, will greatly expand the pool of investors, Charles Schwab, CEO at Charles Schwab(SCHW) said.
- The Sierra Club notified Target Corp.(TGT), Dollar General(DG) and RC2 Corp.(RCRC) and seven other US companies they are required to file reports with the US Environmental Protection Agency over lead contamination in toys and other products from China.
- Global energy shares may not be a good place for investors seeking to weather a clampdown on credit because the industry’s profit may have peaked.
- LS9 Inc., a renewable petroleum company based in Silicon Valley, California, maintains it has developed a new way to extract energy from plant sugars.
- Goldman Sachs(GS) is boosting the size of a corporate debt fund it is starting to $20 billion take advantage of the turmoil in credit markets.
- Whirlpool Corp.(WHR) is using cardboard, Styrofoam and computers to eliminate dents, dings and scrapes that add millions to production costs annually.

Forbes.com:
- Gasoline prices could decline by 2010 amid a “potential oversupply” of oil products, even though US refining capacity will be expanded less than previously thought, according to a new report by Edinburgh, Scotland-based consultancy Wood Mackenzie LTD.

NY Post:
- NY Democratic Governor Eliot Spitzer’s administration prevented investigators from questioning two top aides in a probe of the governor’s use of state police to collect records on a political rival.

Financial News:
- World issuance of investment-grade bonds is at nearly a three-year low, citing Thomson Financial.