Style Underperformer:
- Large-Cap Value (-.37%)
- Banks (-1.31%), Retail (-1.0%) and Homebuilders (-.84%)
- SI, WPPGY, EDMC, CHBT, BIIB, SBR, RMBS, FARO, UFPI, THO, BPL and HBHC
- 1) SPWRB 2) PHM 3) HAL 4) PM 5) MAR
- 1) BP 2) DELL 3) XOM 4) EOG 5) APH
Friday, June 11, 2010
Bear Radar
Style Underperformer:
Bull Radar
Style Outperformer:
- Small-Cap Growth (+.29%)
- Education (+.77%), Biotech (+.66%) and Airlines (+.63%)
- CSIQ, NSM, ADVS, PFE, BMY, BA, TIN, BP, AIXG, ULTA, ARST, LFUS, MEAS, DCTH, IPCM, DECK, CECO, AGAM, ADVS, SVVS, FINL, CAVM, ALTR, BGH, PWO and TBL
- 1) LXK 2) DFS 3) GME 4) LULU 5) CAL
- 1) QCOM 2) WEN 3) LFUS 4) AAPL 5) BSFT
Friday Watch
Evening Headlines
Bloomberg:
- Euro Company Spreads Rise to Record Versus U.S.: Credit Markets. The risk of owning Europe’s corporate bonds is the highest on record relative to U.S. company debt as investors lose confidence that lawmakers and central bankers can tame the region’s worsening fiscal crisis. Yields on investment-grade bonds in euros rose to a 10- month high of 239 basis points, or 2.39 percentage points, more than government debt, according to Barclays Capital index data. That’s 43 basis points more than the spread for U.S. company fixed-income securities, near the record 44 basis points reached May 27. European bond spreads were below those on dollar debt as recently as February, the indexes show. Yields suggest debt investors are concerned that Europe’s sovereign debt crisis will stifle growth and curb profits.
- Goldman's(GS) Cohn Sees No Sign of Resolution to SEC Case. Goldman Sachs Group Inc. President Gary Cohn said he sees no signs of a resolution to the Securities and Exchange Commission’s fraud claims against the firm. “There’s no indications of anything at this point,” Cohn told reporters at a conference in Montreal today.
- Senate Vote on EPA Carbon Rules Splits Democrats. A failed Republican move to block a U.S. agency from regulating greenhouse gases under existing law may have drawn enough votes to damage Democratic hopes of a passing a bigger pollution-reduction plan this year. Six Senate Democrats joined the Republican effort to challenge the Environmental Protection Agency’s planned regulations for carbon dioxide and other gases linked to climate-change. The motion to disapprove the EPA’s carbon regulations from Lisa Murkowski, an Alaska Republican, was defeated 47-53 in a procedural vote. EPA carbon rules are the Obama administration’s backup plan for limiting greenhouse gases if its preferred approach, cap- and-trade legislation that charges polluters a price for the carbon dioxide they released into the atmosphere, doesn’t pass Congress this year. Senate Majority Leader Harry Reid told reporters after the vote he’ll wait for a meeting with Democrats next week before deciding what should be in next month’s energy legislation, although it won’t be branded as “cap-and-trade.” “We don’t use the word cap-and-trade; that’s something that’s been deleted from my dictionary,” Reid said. “Carbon pricing is something we’re talking about.” and Today, all 41 Republicans voted against the EPA’s proposed carbon regulations. The six Democrats to side with them today were Evan Bayh of Indiana, Ben Nelson of Nebraska, Jay Rockefeller of West Virginia, Mary Landrieu of Louisiana and Mark PryorBlanche Lincoln of Arkansas. They joined Republicans in arguing that the EPA regulations, which would take effect next year, are impractical and damaging to the economy. The regulations are a “back-door national energy tax” that would deal “a devastating blow to an economy that’s already in rough shape,” said Senate Republican Leader Mitch McConnell of Kentucky.
- Wind Companies to Buy More U.S. Parts in Agreement With Unions. Wind-energy companies agreed to buy more parts from U.S. suppliers, and a labor union promised to join in lobbying Congress for a requirement to use more renewable energy. The accord announced today by the American Wind Energy Association and the United Steelworkers union grew out of objections by lawmakers that federal money was being spent to purchase clean-energy components made abroad.
- Hong Kong's Hang Seng Index may fall 6.3%, extending its slump from its November Peak, as technical analysis signals further weakness, according to MF Global Holdings Ltd.
- Korea Bank Debt Faces Biggest European Funding Risk, RBS Says. Bonds of South Korean lenders such as Woori Bank are most at risk among Asian financial companies should Europe’s debt crisis escalate, according to Royal Bank of Scotland Group Plc.“If there is a global liquidity crunch, Korean banks are likely the most vulnerable,” analysts led by Kristine Li wrote in a report e-mailed yesterday. “Korea is the most dependent on external bank financing besides Hong Kong and Singapore, and Korean banks have the highest loan-to-deposit ratio.”
- Papandreou Unwinds Greek Socialist Past to Confront Corruption. Socialist Prime Minister George Papandreou promised to undo decades of welfare policy to win an international bailout for Greece. Keeping the lifeline will force him to reverse another legacy left by past leaders, including his father: corruption and a bloated bureaucracy. Papandreou has promised “clean hands” to win public support for austerity measures that will cost all 11 million Greeks -- from newborns to retirees -- as he introduces in coming weeks a plan to overhaul the pension system, the fattest target in his deficit-cutting campaign. The nation’s financial crisis, which has sparked dozens of anti-government demonstrations including one in which three bank employees were killed, presents an opportunity for a political and economic overhaul that Papandreou must grasp, analysts and investors say. Failure by the 57-year-old, U.S.-born leader threatens default and a cataclysm that may undermine the euro.
- China Reaches Lewis Turning Point as Inflation Overtakes Labor. Shenzhen Jufeng Handicraft Co. was so eager to ensure employees returned to work after February’s Lunar New Year holiday that it threw them a party, handed out gifts and bused workers to homes 1,000 kilometers away. “We needed to do more to make them stay,” said Sunny Jia, sales manager of the Shenzhen-based company, which makes linen, leather bags and cabinets for such customers as Oscar Collections Ltd. in the U.K. “All our customers wanted orders shipped within a month.” China, once an abundant provider of low-cost workers, is heading for the so-called Lewis turning point, when surplus labor evaporates, pushing up wages, consumption and inflation, said Huang Yiping, former chief Asia economist at Citigroup Inc. The result may prompt manufacturers to switch to cheaper countries such as India and Vietnam. “If the first decade of the 21st century saw China rapidly rising as a global manufacturing center, the post-Lewis turning point could see the opposite,” said Huang, an economics professor at Peking University in Beijing. “Global manufacturing activities concentrated in China today may find their way elsewhere.”
- U.S. Firms Build Up Record Cash Piles. U.S. companies are holding more cash in the bank than at any point on record, underscoring persistent worries about financial markets and about the sustainability of the economic recovery. The Federal Reserve reported Thursday that nonfinancial companies had socked away $1.84 trillion in cash and other liquid assets as of the end of March, up 26% from a year earlier and the largest-ever increase in records going back to 1952. Cash made up about 7% of all company assets, including factories and financial investments, the highest level since 1963. While renewed confidence in corporate-bond markets has allowed big companies to raise a record amount of money, many are still hesitant to spend the cash on hiring or expansion amid doubts about the strength of the recovery. They are also anxious to keep cash on hand in case Europe's debt troubles lead to a new market freeze.
- U.S. Shifts Toward Support for Iran's Dissidents. The U.S. has accelerated its effort to provide dissidents in Iran with computer hardware and software to evade government censors. But it's a shift that many activists say is insufficient to bring political change in Tehran.
- Federal Budget Deficit in May Totals $135.93 Billion. The U.S. federal budget deficit rose again in May as the government neared the $1 trillion mark a second straight year. The government spent $135.93 billion more than it collected, the U.S. Treasury said in its monthly budget statement released Thursday. Government spending on defense came short of the expectations of research firm Macroeconomic Advisers, causing the research firm to lower its tracking forecast for second-quarter economic growth to 3.6% from 3.7%. The budget report came out a day after Federal Reserve Chairman Ben Bernanke issued a new warning on the U.S. fiscal condition. Mr. Bernanke, who testified to Congress Wednesday, said there is a risk to the overall economy if financial markets begin worrying about the government's commitment to reducing the deficit. The U.S. ran a record $1.42 trillion deficit in fiscal 2009. Fiscal years begin Oct. 1. Mr. Bernanke even said the U.S. could face problems that debt-stricken Greece has suffered if it doesn't come up with a plan soon to cut the deficit.
- Deflation Fears Stir in Developed Economies. Worries about consumer price deflation are resurfacing in the world's developed economies after weeks of financial-market turmoil driven by Europe's fiscal crisis. The fears are most pronounced in Europe, where policy makers are under pressure to reduce large budget deficits now, before durable recoveries emerge. A combination of spending cuts and tax increases could weigh on economic growth and feed into deflation, which is a broad decline in consumer prices. Deflation makes it harder for consumers, businesses and governments to pay off debts. Principal repayments on debt are fixed but deflation is marked by falling incomes, so as deflation sets in the burden of paying off old debts gets greater. Officials fret about deflation because it is hard to stop. Interest rates are already near zero in the U.S. and elsewhere, so policy makers can't use the traditional tool of rate cuts to spur growth and stop deflation. That's an acute worry today.
- 'We Are Totally Unprepared'. Nine years after 9/11, a chilling complacency about WMD attacks. The most important overlooked story of the past few weeks was overlooked because it was not surprising. Also because no one really wants to notice it. The weight of 9/11 and all its implications is so much on our minds that it's never on our mind. I speak of the report from the Inspector General of the Justice Department, issued in late May, saying the department is not prepared to ensure public safety in the days or weeks after a terrorist attack in which nuclear, biological or chemical weapons are used.
- China's Inflation Rises to 19-Month High of 3.1%. China’s inflation accelerated in May to the quickest pace in 19 months, highlighting overheating risks in the fastest-growing major economy. “China’s economy is still in a cycle towards overheating and the government should step up measures to curb inflation expectations,” Liu Li-Gang, a Hong Kong-based economist at Australia and New Zealand Banking Group Ltd., said before today’s release. “This weekend or this period of time in general before the G-20 summit would be an excellent time” for China to widen the yuan’s trading band, Liu said. Producer-price inflation quickened to 7.1 percent from 6.8 percent.
- Trouble Rumbling in China for US Companies. In a global economy unsettled by the patchiness of the U.S. recovery and European financial turmoil, China would appear to be the one place in the world no one needs to worry about. Appearances may be deceiving. While China's efforts to rein in real-estate speculation have alleviated fears it might be overheating, experts say other issues—from wage inflation to continued currency controls to a new "Buy China" push—are turning the world's third-largest economy into another source of potential trouble for the foreign companies that do business there. That could be especially bad news for U.S. manufacturers, which have not only moved a lot of production to China but come to rely on it in recent years to offset the weakness in many other markets, including the United States.
- Reform Panel Members Got Millions From Wall Street. The 43 U.S. lawmakers charged with shepherding a massive government overhaul of the financial industry over its final hurdles in Congress have collected at least $67 million combined in campaign contributions from financial sources. The conference committee's Senate members have received more than $40 million from political action committees and individuals connected with Wall Street securities and investment firms, commercial banks, insurance companies, mortgage bankers, and finance and credit companies. House members, including panel chairman Barney Frank, have collected at least $27 million for their election campaigns over the same period. Democrats, who make up nearly two-thirds of the panel, are the financial industry's greatest beneficiaries, drawing an average of $1.7 million per lawmaker, versus $1.4 million for each Republican. In fact, about one-third of industry contributions, or $21.7 million, went to only two Senate Democrats—Banking Committee Chairman Christopher Dodd of Connecticut and Charles Schumer of New York. Following is a list of conference committee members and the campaign contributions they have received from securities, investment, banking, insurance, mortgage banking and finance companies since 1989 and during the 2010 election cycle, which began January 1, 2009.
- Frank: Tough Version of 'Volcker Rule' Will Be in Bank Bill. Lawmakers begin efforts to reconcile House and Senate financial reform.
Business Insider:
- WHOOPS: Merrill Sold CDOs To Little Guys. Well, you had to see this one coming...Turns out Merrill Lynch didn't just sell CDOs to "sophisticated" institutional investors. It also sold them to individual investors who thought they were sophisticated.
- New York Governor Warns Of Anarchy If Budget Isn't Passed Right Away. Maybe New York will see its own Greece-like street chaos as a result of the state budget. At least that's what David Paterson seems to be hinting at.
- Check Out North Korea's Racy New Anti-Capitalist Propaganda Video.
- House Passes Bill to Boost FHA Reserves $300 Million a Month. The U.S. House voted to allow the Federal Housing Administration to raise the fees it charges to borrowers, a move that would add $300 million a month to help the agency rebuild its dwindling reserves. The House approved the measure in a 406-4 vote Thursday, sending the bill to the Senate for consideration. The bill allows the FHA, which protects lenders against mortgage defaults, to increase the insurance premium for homebuyers and change the way that fee is collected. It also gives the agency more authority to reject mortgage lenders with excessive defaults.
- Top Fiscal Hawk on Fed Supports Restricting Banks' Derivatives Bets, Goes FURTHER Than Obama. The top fiscal hawk and longest-serving policy maker in the Federal Reserve supports limiting banks' derivatives activities, a potential blow to Wall Street megabanks that use their taxpayer-supported banks to trade the kind of risky financial products that nearly brought down the global financial system. In a letter of support, Federal Reserve Bank of Kansas City President Thomas M. Hoenig endorsed a Senate provision Thursday that would force banks to strip their swaps desks out from their depository institutions, calling it "of utmost importance to our nation's long-term financial and economic stability." The firms would have to move those units, which deal and trade in a type of financial derivative product, into a separately-capitalized institution within the bank holding company, raising as much as a few hundred billion dollars to protect them in case their bets go bad. Or, they could disband the activity altogether. Of the nearly 8,000 banks in the U.S., less than 25 would be seriously affected.
- Cantor Aims to Focus GOP on Spending. House Minority Whip Eric Cantor will kick off a personal drive Friday to rebrand the GOP “as a party that gets it” and would focus on spending — not ideology — if Republicans win a House majority in November. “People are receptive to a message of responsible leadership,” he said in an interview in his Capitol suite.
Reuters:
- Australian PM, BHP(BHP) Knock Down Quick Mine Tax Deal.
- AU Optronics(AUO), CEO Indicted in U.S. for Price-Fixing. AU Optronics Corp, a Taiwanese maker of liquid crystal display panels, and its CEO Lai-Juh Chen, were among those indicted for conspiring to fix prices, the U.S. Justice Department said on Thursday.
- Investors Ditch Global Equities for U.S., Emerging Bonds - EPFR. Investors slashed their equity holdings and poured money into U.S. and emerging market bonds and commodities last week on lingering fears that global growth will be hit by Europe's debt problems, EPFR Global said on Friday.
- Fed's Bullard-Senate Bill Would Politicizes Fed. A senior Federal Reserve official warned on Thursday that a Senate proposal to make the New York Federal Reserve Bank president a White House appointee risks injecting a dangerous dose of politics into the deliberations of the U.S. central bank. "This is pretty much blatant politicization of the Fed," St. Louis Federal Reserve Bank President James Bullard told Reuters in an interview. "I also think it's setting up conflicts with the Board of Governors in the future."
- Foxconn Technology Group will relocate some of its production lines from China to Taiwan after a spate of suicides at a plant in southern China, citing Terry Gou, chairman of the Hon Hai Group, which includes Foxconn.
- Oversupply in Mumbai Luxury Housing Looms Large. Property developers are dreaming of making Lower Parel, a former textile hub in central Mumbai, into a super-luxury residential address for the country’s ultra-rich. However, analysts and property consultants see oversupply of premium houses looming large on the island city’s skyline. In all, Lower Parel is expected to see over 10 million sq ft of residential supply in the next three to four years, according to Religare Capital Markets.
Citigroup:
- Rated (FO) Sell, target $41.
- Upgraded (BMY) to Buy, target $30.
- Asian indices are +.50% to +1.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 142.0 -9.0 basis points.
- S&P 500 futures -.14%.
- NASDAQ 100 futures -.15%.
Earnings of Note
Company/Estimate
- None of note
8:30 am EST
- Advance Retail Sales for May are estimated to rise +.2% versus a +.4% gain in April.
- Retail Sales Less Autos for May are estimated to rise +.1% versus a +.4% gain in April.
- Retail Sales Ex Auto & Gas for May are estimated to rise +.2% versus a +.4% gain in April.
- Preliminary Univ. of Mich. Consumer Confidence for June is estimated to rise to 74.5 versus a reading of 73.6 in May.
- Business Inventories for April are estimated to rise +.5% versus a +.4% gain in March.
- (LNCR) 3-for-2
- The Fed's Plosser speaking, Fed's Kocherlakota speaking and the Jefferies Life Sciences Conference could also impact trading today.
Thursday, June 10, 2010
Stocks Sharply Higher into Final Hour on Less Energy Sector Pessimism, Diminishing Economic Fear, Falling Sovereign Debt Angst, Short-Covering
Broad Market Tone:
- Advance/Decline Line: Substantially Higher
- Sector Performance: Every Sector Rising
- Volume: Slightly Below Average
- Market Leading Stocks: Underperforming
- VIX 30.62 -9.04%
- ISE Sentiment Index 75.0 -8.54%
- Total Put/Call .96 -6.80%
- NYSE Arms .20 -81.40%
- North American Investment Grade CDS Index 127.11 bps +.30%
- European Financial Sector CDS Index 165.46 bps -4.37%
- Western Europe Sovereign Debt CDS Index 130.83 bps -7.32%
- Emerging Market CDS Index 287.54 bps -3.73%
- 2-Year Swap Spread 37.0 -3 bps
- TED Spread 46.0 +1 bp
- 3-Month T-Bill Yield .08% -1 bp
- Yield Curve 254.0 +9 bps
- China Import Iron Ore Spot $143.20/Metric Tonne -1.04%
- Citi US Economic Surprise Index +3.20 +2.0 points
- 10-Year TIPS Spread 2.0% +6 bps
- Nikkei Futures: Indicating +203 open in Japan
- DAX Futures: Indicating -1 open in Germany
- Higher: On gains in my Technology, Medical, Retail and Biotech long positions
- Disclosed Trades: Covered some of my (IWM)/(QQQQ) hedges and some of my (EEM) short
- Market Exposure: Moved to 75% Net Long
Today's Headlines
Bloomberg:
- Euro Advances on Speculation Crisis Won't Derail Global Growth. The euro strengthened against the dollar and the yen as stocks climbed on speculation that Europe’s fiscal debt crisis is unlikely to derail global growth, fueling investor appetite for riskier assets. Europe’s common currency also rallied after Germany’s top constitutional court rejected an emergency attempt to block the nation from granting aid guarantees and the European Central Bank’s president said its “temporary” bond purchases will continue. The dollar and yen fell after reports showed economic growth in Asia is accelerating, damping demand for the currencies as a haven.
- Soros Says 'We Have Just Entered Act II' of Crisis. Billionaire investor George Soros said “we have just entered Act II” of the crisis as Europe’s fiscal woes worsen. “The collapse of the financial system as we know it is real, and the crisis is far from over,” Soros said today at a conference in Vienna. “Indeed, we have just entered Act II of the drama.” Europe’s debt-ridden nations have to raise almost 2 trillion euros ($2.4 trillion) within the next three years to refinance maturing bonds and fund deficits, according to Bank of America Corp. “When the financial markets started losing confidence in the credibility of sovereign debt, Greece and the euro have taken center stage, but the effects are liable to be felt worldwide,” Soros said.
- AT&T(T), Boeing(BA) Buck Anti-Incumbent Trend in Giving to Democrats. While Americans may be eager to vote congressional lawmakers out of office, U.S. companies are pouring money into incumbents’ campaigns. And Democrats are the biggest beneficiaries. Democrats fighting to maintain control of the U.S. House are drawing funds from companies such as AT&T Inc.(T), Boeing Co.(BA) and Honeywell International Inc.(HON) Their corporate political action committees are among the top donors to 31 Democratic incumbents seen by analysts as the most endangered this year, a review of Federal Election Commission records shows. Corporate PACs have given the campaigns of those Democrats 14 times more money than they’ve donated to the Republican challengers in the midterm congressional elections. A Gallup Poll conducted May 24-25 found 60 percent of registered U.S. voters would rather support a House candidate who has never served in Congress, compared with 32 percent who favored a nominee with some congressional experience. Overall, corporate PACs gave $5.2 million to the most vulnerable Democrats, compared with $366,000 to their Republican challengers.
- Clive Commodity Fund Loses 6% in May, Worst Decline Since 2008. Clive Capital LLP’s $3.9 billion commodity hedge fund fell 6 percent in May, the biggest drop since July 2008, mostly because of losses in energy and metals. Clive Fund Ltd. declined a cumulative 4.2 percent in the first five months of the year, London-based Clive Capital said in a monthly report to investors.
- U.S. Home Seizures Jump 44% to Record as All States Show Rise. U.S. home foreclosures reached a record for the second consecutive month in May, with increases in every state, as lenders stepped up property seizures, according to RealtyTrac Inc. Bank repossessions climbed 44 percent from May 2009 to 93,777, the Irvine, California-based data company said today in a statement. Foreclosure filings, including default and auction notices, rose about 1 percent to 322,920. One out of every 400 U.S. households received a filing. “We’re nowhere near out of the woods,” Rick Sharga, RealtyTrac’s senior vice president for marketing, said in a telephone interview. “We’re likely to set a quarterly record for home seizures if June is anything like May.”
- Deutsche Bank(DB) CEO Says Stress Tests Could Be 'Very Dangerous'. Deutsche Bank AG Chief Executive Officer Josef Ackermann said publishing stress tests would be “very, very dangerous” if mechanisms to support European banks weren’t in place beforehand. “If we want to disclose the results of stress testing, then we must have backstop facilities in place,” Ackermann, speaking as the chairman of the Institute of International Finance, said at a conference in Vienna today. “Otherwise the uncertainties and instability of the market will increase.”
- Immelt, Gates Push to Boost Clean Energy Spending. General Electric Co.’s(GE) Jeffrey Immelt and Microsoft Corp.’s(MSFT) Bill Gates today called for the U.S. government to more than triple its spending on clean energy research and development to $16 billion a year. The executives, part of group that includes Xerox Chief Executive Officer Ursula Burns and venture capitalist John Doerr, are also recommending the creation of a national energy strategy board. The group, outside advisers created by U.S. President Barack Obama to recommend steps to boost the economy, plans to meet with the president in Washington today.
- SEC Approves Halts for S&P 500 Stocks That Move 10%. The U.S. Securities and Exchange Commission approved rules that will halt trading in Standard & Poor’s 500 Index stocks during periods of volatility, a response to the May 6 plunge that wiped out $862 billion in 20 minutes.
Wall Street Journal:
- U.K. Speaks Out in Defense of BP(BP). British officials offer first public signs of support for company in face of heightened criticism from U.S.
- North Korea Rallies Against South. North Korea's state media over the last two weeks stepped up an anti-South Korea campaign after being accused of sinking a South Korean warship, with reports repeatedly portraying angry citizens vowing to work harder to "get back" at the South. The reports have dominated TV newscasts monitored in Seoul and appeared in newspapers that arrive in South Korea more than a week after publication.
- U.S. Faces 'Severe' AIG Losses, Says Panel. A watchdog panel reviewing the bailout of American International Group Inc. said U.S. taxpayers "remain at risk for severe losses" and that the government didn't act aggressively enough to protect U.S. taxpayers during the 2008 rescue. In a lengthy report, the bipartisan Congressional Oversight Panel concluded that the U.S. government, which owns nearly 80% of the insurance giant, is likely to "remain a significant shareholder in AIG through 2012" and it is unclear if taxpayers "will ever be repaid in full."
- BofA(BAC) Looking at 'Citigroup-Type of Breakup': Bove. Bank of America is shedding some of its foreign banks and other assets while positioning itself for a "Citigroup-type of breakup," banking analyst Dick Bove said Thursday.
Risk.net:
- Protection on Long-term Deflation Hits Highest Levels Since 2008. The cost of option protection against long-term deflation in the eurozone has reached its highest levels since late 2008.
- Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Thursday shows that 26% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-three percent (43%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -17 (see trends).
- Lawmakers Seek to Gut Ethics Office. The Office of Congressional Ethics, a powerful symbol of Democrats’ promise to “drain the swamp” in Washington, is in danger of having its power stripped after the midterm elections. Members of the Congressional Black Caucus have led the charge, airing complaints about the aggressive, independent panel in a private session with House Speaker Nancy Pelosi last month, and they’ve drafted a resolution that, if approved, would severely curtail the panel’s power.
- Panel: AIG Bailout 'Poisonous'.
- Congressman Says GM is Destroying Documents. General Motors Co. executives are destroying documents, e-mails and other records that could shed light on corporate decisions that have triggered investigations by a U.S. House oversight committee, two top Republicans allege. The accusations were made in a letter Wednesday to GM Chairman and Chief Executive Ed Whitacre, and signed by U.S. Rep. Darrell Issa, R-Calif., and U.S. Rep. Jim Jordan, R-Ohio. The politicians asked GM to stop destroying documents that could provide insight into investigations focused on GM's controversial commercial touting its repayment of $6.7 billion in federal loans, and other moves.
Reuters:
- British PM Cameron Pledges Help in BP(BP) Oil Spill. British Prime Minister David Cameron said on Thursday he was ready to help deal with BP Plc's Gulf of Mexico oil spill, speaking out on the crisis while the beleaguered British company's shares took a fresh hit in London but rebounded from a massive slump in New York.
- US Speaker Pelosi Urges BP(BP) to Halt Dividend. A top U.S. congressional leader on Thursday urged BP (BP) to suspend its dividend to make sure businesses hit by the Gulf oil spill get compensation, and accused the British energy giant of a "lack of integrity."
- China Faces Wave of Strikes After Foxconn Pay Rise. Fears of growing labour unrest in China deepened on Thursday as a series of strikes were reported around the country after workers at Honda and electronics assembly giant Foxconn won dramatic pay rises last week.
- How the United States Became a PR Disaster for Deutsche Bank. Deutsche Bank(DB) is deeply involved in the American real estate crisis. After initially profiting from subprime mortgages, it is now arranging to have many of these homes sold at foreclosure auctions. The damage to the bank's image in the United States is growing.
- German Chancellor Angela Merkel's demand to expel overspending members from the euro region as a measure of last resort is a "political provocation" that's not in line with European Union treaties, Italian Foreign Minister Franco Frattini said. Even proposals to suspend the voting rights of high-deficit euro region member states have no chance of implementation because such a move would require changes to EU treaties, he said. "For a reform there needs to be unanimity, but there won't be any," Frattini said.
- Spanish lenders are applying to become members of central counterparty systems such as Eurex and London Clearing House to offset the lack of short term financing in the interbank market, citing an industry official.
- Negotiations between Spanish unions and employers over proposed changes to labor legislation ended without agreement early today, citing people in the Labor Ministry it didn't identify.
- Home sales in Beijing hit a record low of 428 last week and could fall further, citing real-estate agents and analysts. The average daily volume of home sales fell to under 100 for the fourth week running, citing government data.The government's "stringent" second-home mortgage policy, which went into effect on April 15, and a wait-and-see attitude from buyers are being blamed for the decline.
Bear Radar
Style Underperformer:
- Large-Cap Value (+1.87%)
- Education (+.27%), Gold (+.71%) and I-Banks (+1.17%)
- THO, MCF, SCHS, NTES, RDY and FAF
- 1) CECO 2) IGT 3) CTXS 4) HOG 5) ADM
- 1) BP 2) DAL 3) GS 4) LM 5) MTO
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