Today's Headlines

Bloomberg:

• ADP Estimates U.S. Companies Cut 39,000 Jobs in September. Companies in the U.S. unexpectedly cut jobs in September, data from a private report based on payrolls showed today. Employment decreased by 39,000, the biggest drop since January, after a revised 10,000 rise in August, according to figures from ADP Employer Services. The median estimate of 37 economists surveyed by Bloomberg News called for a 20,000 gain. “It’s more evidence of a lousy labor market,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York. “Here we are, 18 months into a recovery and we’re not doing much on the job front. The economy is a top issue for voters in the November congressional elections and polls show the public is increasingly skeptical of President Barack Obama’s performance. His job approval over a three-day period that ended Oct. 4 was 45 percent, compared with 53 percent at the same time last year, according to a poll from Princeton, New Jersey-based Gallup Inc. Economists at Goldman Sachs Group Inc. said the U.S. economy will be “fairly bad” or “very bad” over the next six to nine months.
• The cost of protecting European sovereign debt from default fell to the lowest level in a month as the Bank of Japan's move to prop up its economy prompted speculation more central banks will follow suit. The Markit iTraxx SovX Western European Index of credit default swaps declined about 5 basis points to 145.75, according to CMA. Contracts on Portugal government debt fell 18 basis points to a two-week low of 388.3 basis points, while derivatives tied to Irish bonds declined 10 basis points to 427.4 basis points, the lowest level since Sept. 17, CMA prices show. Contracts on the Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings declined 12.75 basis points to 475 after falling 14.75 basis points yesterday, according to Markit. The Markit iTraxx Europe index of 125 companies with investment-grade ratings dropped 2.5 basis points to 103.
• The Portuguese economy may contract next year if new budget deficit-cutting measures are taken into account, the IMF said. Portugal's gross domestic product may shrink 1.4% in 2011, Jorg Decressin, head of the IMF's world economic studies division, said today. The IMF had forecast no growth in 2011 GDP prior to the announcement of the additional measures last week.
• Commodities Rise to Two-Year High on Central-Bank Debt Buying Speculation. Commodities rose to the highest in almost two years on speculation central banks around the world will join the Bank of Japan in increasing purchases of government debt to boost economic recovery.
• States Should Cut Budgets, Not Borrow, to Balance Budgets, Pew Poll Finds. Lawmakers should cut spending or raise taxes before borrowing to balance budgets, according to a poll of residents in five states that account for almost half of the nation’s projected deficits. More than two-thirds of respondents in Arizona, California, Florida, Illinois and New York said that governments should spend less, according to a report released today by the Pew Center on the States and the Public Policy Institute of California. The states polled make up one-third of the U.S. population and 45 percent of projected state budget gaps, according to the report.
• UN's Talks in China on Climate Change Show Little Progress, Bolivia Says. United Nations talks in China aimed at reaching an agreement to mitigate climate change are making little progress, according to Pablo Solon, the head of Bolivia’s delegation to the meeting. Delegations are avoiding discussion over the content of the negotiating text by introducing new proposals, while there’s been no movement on the “insufficient” pledges by developed countries to reduce their greenhouse gas emissions, Solon, Bolivia’s Ambassador to the UN, said today. Officials from 177 governments are meeting in Tianjin, China to move forward on a climate treaty for when emissions targets set by the Kyoto Protocol expire at the end of 2012.
• Fitch Downgrades Ireland's Rating on Cost of Banking Bailout. Fitch Ratings lowered Ireland’s credit grade to the lowest of any of the major rating companies and said there’s a risk of a further reduction. Ireland was cut to A+ from AA-, reflecting the “exceptional and greater-than-expected cost” of the nation’s bailout of its banking system, Fitch said in a statement today. The move comes a day after Moody’s Investors Service said it may cut the country’s rating. Ireland may have to spend as much as 50 billion euros ($69 billion) to repair its financial system, pushing the budget deficit this year to 32 percent of gross domestic product. Fitch said the rating could be lowered again if the economy stagnates and political support for budgetary consolidation weakens.
• U.S. Cities Expect Finances to Worsen as Property Taxes Slide. U.S. cities expect their financial strains to worsen as the slide in real estate prices that began four years ago cuts deeper into property-tax collections, according to a survey by the National League of Cities. Eighty percent of city finance officers expect to have more difficulty balancing their budgets in the 2011 fiscal year, which began in June for most municipalities, than during the prior period, according to the survey. While housing prices have begun to stabilize, property taxes are expected to drop as home prices are reassessed to account for earlier declines.
• Euro Area's Economic Growth May Slow to .3% This Quarter, Institute Says. Europe’s economic recovery may slow in coming months as households cut back spending, companies trim investment and export demand weakens, three of the region’s economic research institutes said. Gross domestic product in the 16 euro-area nations probably rose 0.4 percent in the third quarter after increasing 1 percent in the previous three-month period, the Munich-based Ifo institute, Rome-based Isae and Insee in Paris said today in a joint quarterly statement. Growth may ease to 0.3 percent in the current quarter and to 0.2 percent early next year, they said. “GDP growth in the euro zone is expected to go back to a lower pace,” the institutes said in the e-mailed statement. “Private consumption would flatten as the labor market is likely to remain fragile. Furthermore, the boost to income provided by the fiscal stimulus is to wane.”
• JPMorgan(JPM), Bank of America(BAC) Face 'Hydra' of Foreclosure Probes. JPMorgan Chase & Co., Bank of America Corp. and Ally Financial Inc., defending allegations of fraudulent home foreclosures from customers and Congress, may face the most financial peril from investigations by state attorneys general. Authorities in at least seven states are probing whether lenders used false documents and signatures to justify hundreds of thousands of foreclosures, and the number of these inquiries will grow, according to state officials and legal experts. “You’re going to see a tremendous amount of activity with all the AGs in the U.S.,” Ohio Attorney General Richard Cordray said in an interview. “We have a high degree of skepticism that the corners that were cut are truly legal.”

Wall Street Journal:

• Apple(AAPL) Making Verizon(VZ)-Ready iPhone by Year End. Apple Inc. plans to begin mass producing a new iPhone by the end of 2010 that would allow Verizon Wireless to sell the smartphone early next year, said people briefed by Apple. The new iPhone would be similar in design to the iPhone 4 currently sold by AT&T Inc. but would be based on an alternative wireless technology called CDMA used by Verizon, these people said. The phone, for which Qualcomm Inc.(QCOM) is providing a key chip, is expected to be released in the first quarter of next year, according to the same people. An Apple CDMA iPhone would spell the end of the exclusive U.S. arrangement with Apple that AT&T has had since 2007, when the original iPhone debuted.

Zero Hedge:

• Greece Caught Lying AGAIN as Debt and Deficit Figures to "Shoot Up" Post Audit.

AppleInsider:

• Apple Developing New iPhones with Larger, Smaller Screens - Report. Apple is currently working to expand the iPhone line, and may offer larger and smaller models as soon as early 2011, one Wall Street analyst has said. Shaw Wu with Kaufman Bros. said Wednesday that checks with sources in Apple's overseas supply chain have indicated that the company is working on new iPhone models with both larger and smaller touchscreens. He said those products could launch in 2011, and on new carriers other than the currently exclusive AT&T.

San Francisco Chronicle:

• Trading Pennies into $7 Billion Drives High-Frequency's Cowboys. A cowboy-hat-wearing robot with "Sell" emblazoned across its chest adorns a wall-length mural in the lounge of RGM Advisors LLC in Austin, Texas. Another robot, with "Buy" on it, wobbles toward a green Wall Street sign as two machines tote spark-emitting high-speed cables. "We explained to a local artist that we wanted a mural that represented our business, and he came up with the design," RGM Chief Executive Officer Richard Gorelick says in an airy 16th-floor office that calls to mind a Scandinavian design firm rather than a company that trades hundreds of millions of shares a day, Bloomberg Markets magazine reports in its November issue.

Politico:

• White House May Have Blocked Oil Spill Figures. White House officials may have blocked the release of a more accurate and dramatic estimate of the Gulf of Mexico oil spill, perhaps hindering public confidence in the Obama administration’s cleanup efforts, according to an Oil Spill Commission staff report released Wednesday. The report says that the National Oceanic and Atmospheric Administration wanted to make some of its worst-case scenarios for the BP spill available to the public shortly after the April 20 explosion on the Deepwater Horizon rig but was overruled by the White House Office of Management and Budget.
• Reject Tax Hike For Small Business.
  

Eastday:

• Shanghai may issue details for its property tax soon. Shanghai may set the property tax rate at 30 to 40 basis points and the tax will likely be implemented by the end of the year, citing Yang Hongxu, head of the Shanghai-based E-house China research institute.