Today's Headlines

Bloomberg:

• Spanish, Italian Bonds Rise on Bets European Officials May Act on Crisis. Spanish and Italian bonds rose for the first time in six days after the Swiss central bank cut interest rates, stoking speculation euro-area policy makers may also take action to ease stresses in financial markets. German bunds swung between gains and losses as European Commission President Jose Barroso today urged governments to quickly approve a planned upgrade of the euro-area rescue fund, saying the perception that leaders haven’t found a “systemic” answer to the crisis is hurting investor sentiment. The European Commission said it will issue a statement on the “situation in the financial markets” today, while the European Central Bank will make its monthly decision on interest rates tomorrow. “There’s short-covering driven by an expectation of some sort of action,” said Steven Major, global head of fixed-income research at HSBC Holdings Plc in London. The Italian 10-year bond yield dropped three basis points to 6.10 percent at 4 p.m. in London. The 4.75 percent security maturing in September 2021 rose 0.19, or 1.9 euros per 1,000- euro ($1,428) face amount, to 90.57. The difference in yield, or spread, between Italian 10-year bonds and similar-maturity German debt was little changed at 372 basis points. The yield on 10-year Spanish bonds also fell three basis points, to 6.26 percent. The Spanish spread over bunds shrank four basis points to 387 basis points.
• ADP Says U.S. Companies Added 114,000 Jobs. Companies in the U.S. added 114,000 workers to payrolls in July, according to a private survey. The increase followed a revised 145,000 gain the prior month, according to data from ADP Employer Services. The median forecast of economists surveyed by Bloomberg News called for an advance of 100,000.
• U.S. Service Industry Grows Less Than Forecast. Service industries expanded in July at the slowest pace in 17 months as orders and employment cooled, indicating the biggest part of the U.S. economy had little spark to begin the second half of the year. The Institute for Supply Management’s index of non- manufacturing businesses, which covers about 90 percent of the economy, dropped to 52.7 from 53.3 in June. Readings above 50 signal expansion, and the median projection in a Bloomberg News survey was for 53.5 in July.
• MasterCard(MA) Jumps as Card Spending Increases. MasterCard Inc. (MA), the world’s second- biggest payments network, climbed the most in five weeks in New York trading after second-quarter profit beat analysts’ estimates, helped by an increase in customers’ spending. The stock gained 8.5 percent to $323.85 at 12:27 p.m. on the New York Stock Exchange, the biggest jump since June 29 and the highest since the company’s initial public offering in May 2006. Net income rose 33 percent to $608 million from the same period a year earlier, the Purchase, New York-based firm said today in a statement. Earnings per share of $4.76 exceeded the $4.23 average estimate of 29 analysts surveyed by Bloomberg as net revenue increased 22 percent to $1.7 billion.
• Crude Oil Declines to Five-Week Low on Concern U.S. Economy Is Faltering. Crude oil tumbled to a five-week low on concern that a faltering economy will curb fuel demand in the U.S., the world’s biggest oil-consuming country. “The main driver is the economy,” said Sean Brodrick, a natural resource analyst with Weiss Research in Jupiter, Florida. “If the U.S. economy is slowing the easiest path for oil is lower. We’ll soon be testing support just below $90.” Crude oil for September delivery dropped $2.15, or 2.3 percent, to $91.64 a barrel at 1:29 p.m. on the New York Mercantile Exchange. Futures touched $91.22, the lowest level since June 28. Prices have climbed 11 percent in the past year.
• Wal-Mart(WMT) Visits Drop as Products Fail to Draw. Visits to Wal-Mart Stores Inc. (WMT)’s U.S. locations open at least a year dropped 2.6 percent from February through June, according to an internal memo, while rivals are attracting customers.

Wall Street Journal:

• Former Top Fed Officials Signal Support For QE3 If Inflation Slows. The U.S. economy faces a risk of falling back into recession and the Federal Reserve might need to consider a new round of securities purchases to deal with it, even though it isn’t in a strong position to address a slowdown, three former top officials at the central bank said. In an exclusive interview with the Wall Street Journal, Donald Kohn, Vincent Reinhart and Brian Madigan – the last three directors of the Fed’s powerful monetary affairs committee — put the risk of a new economic contraction at between 20% and 40%.

CNBC.com:

• Mortgage Applications Rose Last Week on Lower Rates. The MBA's seasonally adjusted index of refinancing applications rose 7.8 percent, while the gauge of loan requests for home purchases rose 5.1 percent.

Business Insider:

• Boehner Introduces Revised Debt Ceiling Plan, Senate Democrats Pledge To Vote Against It.
  
• 11 Big Things Worrying Hedge Funder John Burbank.
• Google+ Panic at Facebook? Engineers Embrace Another "Lockdown" In Response to Google's Social Network.
• Sorry Liberals, There's Almost No Chance The "Super Committee" Can Raise Taxes.
• "Sudden and Unexpected" Burst Of Downsizing Causes Layoffs to Explode Nearly 60% in July.
  

Rasmussen Reports:

• 69% Say It's Likely Scientists Have Falsified Global Warming Research.

Reuters:

• Sovereign Rot Hits Italian Banks. Italian banks' reliance on the ECB has jumped to its highest since the beginning of the year as they struggle to access the bond market as a result of the sovereign crisis. "We are increasingly concerned about Italy and its banks being drawn into a vicious circle of shrinking market access, rising funding costs and deteriorating credit ratings and - ultimately - fundamentals," said Georg Grodzki, head of credit research and Legal and General Investment Management.

Telegraph:

• ECB To Protect Europe By Buying Bonds. The European Central Bank is expected to signal it is stepping into the eurozone debt crisis on Thursday by reopening its purchases of government debt, amid fears the turmoil will claim the economy of a nation that is "too big to bail".