Evening Headlines
Bloomberg:
- Irish Bailout May Unleash Market Vigilantes on Portugal: Credit Markets. A resolution of the Irish debt crisis may shift the burden of speculation to Portugal. While officials such as European Central Bank Vice President Vitor Constancio predict a bailout of Ireland will reduce financial pressures in the euro region, analysts from Citigroup Inc. and Nomura International Plc say any relief would be short-lived as investors turn their focus to the next-weakest peripheral nation. The markets indicate that country is Portugal with 10-year bond yields of 6.92 percent, compared with 8.31 percent in Ireland and 11.71 percent in Greece, which received rescue funds in May from the European Union and International Monetary Fund. Portuguese Finance Minister Fernando Teixeira dos Santos said Nov. 15 that while “there is a risk of contagion,” that doesn’t mean the country will seek financial aid. “Portugal isn’t in the situation that it is now because of Ireland,” said Steven Mansell, director of interest-rate strategy at Citigroup Global Markets Ltd. in London. “If Ireland reaches an agreement to tap the European Financial Stability Facility or some other mechanism to support its banking sector, I don’t think that will alleviate the pressure on Portugal.”
- Cowen Scorned as Irish Mourn Loss of Sovereignty With Bailout. Irish rebels fought for independence during World War I, boasting they served “neither King nor Kaiser.” Ireland may now have to do exactly that to qualify for a bailout partly funded by both Britain and Germany. Prime Minister Brian Cowen is edging toward accepting a rescue package that may threaten the country’s low-tax policies and put voters on the hook to repay loans the central bank says may be worth “tens of billions” of euros. For critics of Cowen’s Fianna Fail party, which governed Ireland through its decade-long boom, national pride is at stake. Cowen has “squandered” independence for a “German bailout with a few shillings of sympathy from the British chancellor,” the Irish Times newspaper said yesterday. The government should be “ashamed that Fianna Fail should be the ones to surrender sovereignty,” said Michael Noonan, finance spokesman for Fine Gael, the largest opposition party.
- General Motors(GM) Sells $500 Million Stake to China Partner SAIC. General Motors Co. sold a $500 million stake in its initial public offering to Chinese partner SAIC Motor Corp ., cementing ties that have helped the American company boost sales in the world’s largest auto market. SAIC bought the 0.97 percent stake “on the basis of a good strategic partnership between the two” and its “confidence in GM’s development prospects,” the Shanghai-based carmaker said in an e-mailed statement yesterday.
- Oil Trades Below $82 on Speculation Ireland Bailout Not Enough. Oil traded below $82 a barrel, retracing earlier gains, on concerns that a European Union-led bailout of Ireland may not be enough to stabilize sovereign debt concerns in the region.
- Irish Grasp at EU, IMF Lifeline. Dublin Admits It Needs a Rescue; Moment of Truth for 16-Nation Euro Zone. The Irish government all but buckled to pressure to accept a historic international bailout Thursday, capitulating after a week of intense lobbying from officials across Europe and spurring questions about which other European economies will need a helping hand.
- Few Businesses Sprout, With Even Fewer Jobs. Fewer new businesses are getting off the ground in the U.S., available data suggest, a development that could cloud the prospects for job growth and innovation. In the early months of the economic recovery, start-ups of job-creating companies have failed to keep pace with closings, and even those concerns that do get launched are hiring less than in the past. The number of companies with at least one employee fell by 100,000, or 2%, in the year that ended March 31, the Labor Department reported Thursday. That was the second worst performance in 18 years, the worst being the 3.4% drop in the previous year. Newly opened companies created a seasonally adjusted total of 2.6 million jobs in the three quarters ended in March, 15% less than in the first three quarters of the last recovery, when investors and entrepreneurs were still digging their way out of the Internet bust.
- Private Medicare Plans Are Retrenching. Seniors enrolling in private Medicare policies starting this week are finding fewer options, as health insurers close down certain types of plans due to legislative changes and looming cuts to federal funding.
- Foreclosure Talks Gain Steam. Talks between major lenders and state attorneys general about the nationwide investigation of foreclosure practices are accelerating, with state officials pushing for an overhaul of the loan-modification process that would be much broader than a crackdown on the use of "robo signers," people familiar with the situation said. Ally Financial Inc.'s GMAC Mortgage unit on Thursday held its first face-to-face meeting in Iowa with the multistate group involved in the investigation. Iowa Attorney General Tom Miller is spearheading the probe. Bank of America Corp., Citigroup Inc. and J.P. Morgan Chase & Co. have recently picked up the pace of their talks or are planning to meet soon with key officials in the probe.
- Iran Rights Envoy Assails U.N. Censure. Official Defends Stoning, Arrests, as General Assembly Committee Condemns Crackdown by Tehran. Iran's top human-rights official gave a robust defense of his country's right to engage in the stoning of criminals and imprison lawyers viewed as threatening the stability of the Islamic Republic, as a United Nations committee censured Tehran for what it said was an accelerating crackdown on its opponents.
- An Energy Drink for the GOP. The Republicans have yet to make the billions wasted on job-killing subsidies to green energy projects a top issue.
- US Municipal Bond Prices Revive After Steep Sell-Off.
- Hedge Funds Holding Ground Despite Redemption Rumors. Hedge funds are poised to close out a strongly profitable year, even though smaller firms are under pressure as investors still have the jitters over an unpredictable market. Industry veterans refuted rumors that have passed our way regarding a strong flow of redemptions as managers close out their books for 2010. In fact, the $2.34 trillion dollar hedge fund business saw $26.6 billion of inflows in the third quarter as part of a net increase of $120.9 billion, according to data from Bank of America Merrill Lynch. That equates to a 5.45 increase in total assets under management. Not bad numbers considering increasing whispers that investors are bailing on hedge funds.
- Fed's Plosser: Zero Rates May Be Too Low. Philadelphia Federal Reserve Bank President Charles Plosser said on Thursday that it was "absolutely" possible that the U.S. central bank was making a policy mistake by keeping short-term rates pressed to zero. Plosser, who assumes a voting position on the Fed's policy-setting panel next year, also told a conference at the Cato Institute that it was not clear that "extra action" was a good thing. Plosser also said that he did not believe the Fed's further easing of monetary policy was warranted given current economic conditions. "For me, the benefits were not large enough to outweigh the costs," he told reporters after a conference at the Cato Institute.
- Bernanke Turns Up Heat on China Currency Policy. Federal Reserve Chairman Ben Bernanke put aside traditional central bank niceties and launched a direct attack on the slow pace of China’s steps to strengthen its currency. In a speech prepared for a conference at the European Central Bank on Friday morning, Bernanke said that China’s decision to undervalue the yuan has essentially thrown a monkey wrench into the global economic recovery.
Zero Hedge:
- More Hot Water for Phil Falcone? Company Once Linked to Kennedy Assassination Reveals Informal Investigation of Harbinger Trades.
- Man U Player of the Century Eric Cantona Appeals for Peaceful Revolution Against Banks, Calls for Europeans to Pull Their Money. (video)
- Pat-Downs at Airports Prompt Complaints. Some offer graphic accounts of genital contact, others tell of agents gawking or making inappropriate comments, and many express a general sense of powerlessness and humiliation. In general passengers are saying they are surprised by the intimacy of a physical search usually reserved for police encounters.
- Audio Technology Maker Seeks New Growth Markets. In a world that can't seem to get enough video, there's still plenty of money to be made in audio. Consider the case of San Francisco-based Dolby Laboratories (DLB).
- Wind Energy, Solar Power Face Cloudy Future. After years of rapid growth and darling status among many in Washington, the future of the American renewable energy industry is uncertain. That's because the government cash it has come to rely on may dry up on Dec. 31.
- Hong Kong's government will release measures intended to cool the rising home market after the stock exchange closes today, Dow Jones Newswires reported.
- Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Thursday shows that 25% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-two percent (42%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -17 (see trends).
Reuters:
- Dell's(DELL) Margins Blow by Street, Shares Rise. Dell Inc raised its yearly income forecast after third-quarter margins and smashed expectations, helped by sliding costs of PC components and propelling its shares 4.8 percent higher.
- Foot Locker(FL) Q3 Beats on Higher Margins, Shares Jump. n">Athletic footwear retailer Foot Locker Inc posted third-quarter results that raced past Wall Street expectations, as strong demand for running shoes spurred comparable-store sales and gross margin expansion, lifting its shares 10 percent in extended trade. Foot Locker, valued at about $2.61 billion, is now reaping the rewards of closing about 650 underperforming stores over the past 3 years to drive sales and margins.
- n">Salesforce.com(CRM) Sees Sales Growth, Shares Rise. Salesforce.com Inc beat Wall Street profit estimates and forecast better-than-expected sales for the next fiscal year as more customers sign up for its "cloud computing" services, and its shares rose 7 percent.
Telegraph:
- European Central Bank Tightens Screw on Ireland, Portugal and Spain. The European Central Bank (ECB) has issued a clear warning that it will press ahead with plans to raise interest rates and withdraw lending support for banks despite the eurozone debt crisis, even if this risks pushing Ireland, Portugal and Spain into deeper trouble.
- Chinese local-government levels of debt have risen to unsustainably high levels, citing a report by a National Audit Office official. Debt of 18 provinces, 16 cities and 36 counties in China rose 59.4% last year to 2.79 trillion yuan, according to the report by Cai Gen, an audit office official based in Jiangsu province. The debt ratios indicate local authorities are under pressure to repay and may be a credit risk, the report said.
- China's monetary authorities and financial regulators should improve the nation's mechanism for macroeconomic supervision, Wang Songqi, deputy director of financial research at the Chinese Academy of Social Sciences, wrote in a commentary. The biggest risks for China come from its own financial system, Wang said.
Citigroup:
- Reiterated Buy on (FL), target $19.
- Asian equity indices are -1.25% to +.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 103.0 -4.5 basis points.
- Asia Pacific Sovereign CDS Index 100.25 -3.5 basis points.
- S&P 500 futures -.23%
- NASDAQ 100 futures -.28%.
Earnings of Note
Company/Estimate
- (HIBB)/.38
- (ANN)/.34
- (MENT)/.15
- (ADCT)/.21
- (HNZ)/.76
- (SCMR)/-.06
- None of note
- None of note
- The Fed's Bernanke/ECB's Trichet/IMF's Managing Director/Bank of China Governor speaking at ECB Conference and the (BSX) Investor Day could also impact trading today.
No comments:
Post a Comment