Bloomberg:
- The cost to protect against defaults by insurers and banks fell as the biggest weekly gain in stocks since November eased concerns that losses at the companies will reach bondholders. Credit-default swaps on New York-based Citigroup Inc., which reached a record 640 basis points last week, fell 16 basis points today to 529 basis points, according to CMA DataVision. Contracts on Charlotte, North Carolina-based Bank of America Corp. declined 15 basis points to 288 basis points, according to CMA, and swaps on Wells Fargo & Co. of San Francisco fell 11 basis points to 213 basis points. Contracts on Warren Buffett’s Berkshire Hathaway Inc., the insurer that lost its AAA ranking yesterday from Fitch Ratings Inc., declined 23 basis points to 415 basis points, according to CMA.
- The euro may weaken as the region’s economy risks deteriorating, according to UBS AG, the world’s second-biggest currency trader. “The euro-zone economy is more exposed to the growth cycle due to its manufacturing dependency and the outlook is at risk of turning for the worse, as growth-seeking flows are in short supply,” Brian Kim, a currency strategist in Stamford, Connecticut wrote today. “Early-year buying into the euro zone is probably more at risk of unwinding and we maintain a negative outlook for the currency.”
- A record plunge in Chinese exports may be great news for the U.S. Treasury. It’s simple mathematics. The U.S. economy is more than four times the size of China’s. Growth in China is wildly lopsided toward exports, many of those goods packed on ships bound for America. So, if China wants to stay afloat, it should spend less money building roads, bridges and dams and more on U.S. debt. That would give the U.S. and its consumers the access to easy credit to reignite spending, much of it on Chinese-made goods. For better or worse, though, restoring global growth is more of a U.S.-centric exercise than many in Asia and Europe might like to admit. That inconvenient fact makes it pointless for China to suddenly dump its Treasuries. It’s just not an option for the world’s third-largest economy. China would cannibalize its outlook by curtailing its U.S. debt purchases. It may have more to gain from doing the opposite.
- SPDR Gold Trust(GLD), the biggest exchange-traded fund backed by bullion, expanded to a record, overtaking Switzerland’s central bank holdings as the world’s sixth-largest stockpile. The fund now holds 1,041.53 metric tons, equal to more than five months of global mine production, data on the company’s Web site show.
- Crude oil fell after the International Energy Agency and OPEC cut their global demand forecasts because of the recession in major consuming countries. The IEA, which advises 28 developed nations on energy policy, lowered its consumption forecast by 270,000 barrels a day to 84.4 million barrels a day, in a monthly report today. OPEC also reduced its 2009 oil demand outlook, saying the global economy was in a “dreadful situation.” The group curbed its estimate by 520,000 barrels to 84.6 million barrels a day.
- President Barack Obama’s $787 billion economic stimulus plan will generate revenue of more than $100 billion for technology companies, research firm IDC said. Investments in energy technology, such a “smart-grid” programs and renewable sources, will generate $77.6 billion in sales, according to the IDC report, which is set to be released next week. A plan to digitize health records will spur $20.4 billion in spending, while government technology outlays will contribute a further $2.5 billion, IDC said. The extra spending will bolster the U.S. technology industry, which will probably expand 0.1 percent this year, said Meredith Whalen, an analyst at Framingham, Massachusetts-based IDC. The stimulus bill will have a lasting effect on the economy because of the breadth of technology spending, she said.
- The Commodity Futures Trading Commission should have acted sooner to investigate trades done to profit at the expense of the U.S. Oil Fund, the world’s largest exchange-traded fund, Commissioner Bart Chilton said. The CFTC is investigating “multiple market participants,” including the U.S. Oil Fund, which is managed by Alameda, California-based U.S. Commodity Funds LLC. The review, part of the CFTC’s national oil market probe announced last year, is focused on an increase in the price difference between March and April futures contracts on the New York Mercantile Exchange on Feb. 6.
- Exxon Mobil Corp.’s(XOM) oil discovery off the coast of Brazil may hold enough crude to rival the nearby Tupi prospect as the Western Hemisphere’s largest find in three decades. Exxon Mobil’s Azulao-1 well tapped a reservoir that could contain 8 billion barrels of recoverable oil, said Luiz Lemos, a partner at TozziniFreire Advogados, a Brazilian law firm that represents foreign energy companies with projects in the South American nation. “This is very huge,” Lemos said yesterday in a telephone interview from Rio de Janeiro. His firm’s clients include Irving, Texas-based Exxon Mobil, Norway’s StatoilHydro ASA and Devon Energy Corp. of Oklahoma City.
- SanDisk Corp.(SNDK), the biggest maker of flash-memory cards for digital cameras, rose as much as 13 percent on renewed speculation that Samsung Electronics Co. or Toshiba Corp. may make a bid. One of those companies might be planning to make a new offer for SanDisk, the EE Times reported today.
Wall Street Journal:
- Hedge funds of all sizes and strategies are expressing strong interest in the government's plan to unclog consumer-lending pipelines. Now they and other investors need to decide Friday if they will participate in the first round of borrowing through the Term Asset-Backed Securities Loan Facility, or TALF. Some of the biggest hedge funds in the business have participated in calls and meetings with other hedge-fund managers, lawyers and regulators about the program. They include Harbinger Capital Management, Highbridge Capital Management, Elliott Management Corp., Paulson & Co., Perry Capital, Citadel Investment Group, Cerberus Capital Management and D.E. Shaw Group.
- It is simply wrong for commentators to continue to focus on President Barack Obama's high levels of popularity, and to conclude that these are indicative of high levels of public confidence in the work of his administration. Indeed, a detailed look at recent survey data shows that the opposite is most likely true. The American people are coming to express increasingly significant doubts about his initiatives, and most likely support a different agenda and different policies from those that the Obama administration has advanced. Polling data show that Mr. Obama's approval rating is dropping and is below where George W. Bush was in an analogous period in 2001. Rasmussen Reports data shows that Mr. Obama's net presidential approval rating -- which is calculated by subtracting the number who strongly disapprove from the number who strongly approve -- is just six, his lowest rating to date.
CNBC.com:
The Obama administration’s hope-and-change show hasn’t played well on Wall Street, but in the last week investors may finally be getting some of what they want and that could bring a happier ending than anyone imagined. AIG and Citgroup(C). Some change seems inevitable in the near future.
- President Barack Obama's top economic adviser said Friday the nation's economic crisis has led to an "excess of fear" among Americans that must be broken to reverse the downturn. National Economic Council Director Lawrence Summers said consumer spending seems to have stabilized in an encouraging sign, but he also suggested it was still too early to predict the timing of an economic turnaround.
NY Times:
- The timing may be right for a hybrid car with a suggested retail price starting under $20,000 — the first in the American market in that price range. The American Honda Motor Company is taking a big risk on the potential appeal of a more mainstream hybrid. The automaker plans to introduce the 2010 Honda Insight on March 24, with sticker prices of $19,800 to $23,100 (plus destination charges).
MacRumors.com:
- News that Apple will be hosting a media event next week about iPhone 3.0 has generated a lot of speculation about what might be coming in the new release. BoyGeniusReport claims to have heard two possible features that would certainly make many iPhone users happy. They believe that iPhone 3.0 will introduce MMS (Multimedia Messaging Service) and Tethering. MMS would finally offer iPhone users the ability to send photos by way of SMS, and tethering would allow you to share your iPhone's internet connection with your laptop computer.
USAToday.com:
- The U.S. will soon send a large contingent of federal agents to its southern border to help stem the recent violence in northern Mexico, the nation's Homeland Security chief said Thursday. "Every American has a stake in this," Homeland Security Secretary Janet Napolitano said in a phone interview with USA TODAY. "Violence on the border easily seeps into our communities. It also creates a fear in border communities that the rule of law doesn't apply anymore, and that's just unacceptable." The new initiative will mobilize more border-enforcement teams, multiply the number of intelligence analysts working on the border, and step up searches of cars going into Mexico from the USA, Napolitano said.
Reuters:
Competition in the online fashion industry is set to intensify as store groups, hit by sliding sales in the economic downturn, try to grab a slice of one of the few strongly growing retail markets. Better online payment and delivery systems, innovative Web sites that allow consumers to try on clothes virtually and even shop together, and the rising purchasing power of the first generation to grow up with the internet mean online fashion will continue to defy the recession, analysts say.
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