Monday, April 25, 2011

Today's Headlines


  • U.S. New Home Sales Rose 11.1% in March. Purchases of new houses in the U.S. rose in March from a record low as the weakest industry in the economy strained to recover. New-home sales, tabulated when contracts are signed, climbed 11.1 percent to a 300,000 annual pace, faster than forecast, figures from the Commerce Department showed today in Washington. The median estimate in a Bloomberg News survey called for a rise to 280,000. The median sales price decreased 4.9 percent from the same month last year, to $213,800, today’s report showed. Purchases rose in three of four U.S. regions last month, led by a 67 percent surge in Northeast after a 54 percent slump a month earlier. Sales in the South were little changed at a 162,000 pace after February’s 163,000. The supply of homes at the current sales rate fell to 7.3 month’s worth in March from 8.2 months. There were 183,000 new houses on the market at the end of March, the fewest since August 1967, indicating builders are reducing construction.
  • Options Highest Since 2007 Shows Gains Intact Amid Hedging. The end of the Federal Reserve’s Treasury repurchase program is prompting options traders to pay the most in four years for protection against stock declines, a signal that proved bullish in the past. The cost of three-month put options to sell the Standard & Poor’s 500 Index is almost twice the price of calls to buy, the highest ratio since July 2007, according to data compiled by Bloomberg. The last 17 times that so-called skew rose as high, the benchmark gauge for American equities climbed a median 3.9 percent over three months, data compiled by Bloomberg show.
  • Barrick to Buy Equinox for $7.8 Billion. Barrick Gold Corp. (ABX), the world’s biggest gold company, agreed to buy copper producer Equinox Minerals Ltd. (EQN) for C$7.32 billion ($7.69 billion) in cash, trumping an offer from China’s Minmetals Resources Ltd. (1208).
  • Paulson Bought Lehman Senior Bonds For As Little as 9 Cents on the Dollar. Hedge fund Paulson & Co. paid as little as 9 cents on the dollar for some of its $4 billion in Lehman Brothers Holdings Inc. senior bonds, according to a court filing. A bondholders group including New York-based Paulson and the California Public Employees’ Retirement System made the filing in response to a U.S. bankruptcy judge’s order that the group disclose details about its members. The group is fighting to control defunct Lehman’s $61 billion liquidation with a payout plan that competes with Lehman’s own proposal. Paulson paid 9 cents on the dollar for $5.1 million of Lehman’s senior bonds on Dec. 1, 2008, according to the filing. Paulson paid 34 cents to 35 cents on the dollar for the bonds when Lehman filed bankruptcy on Sept. 15, 2008. Calpers paid 86 cents to $1.04 on the dollar for $90.1 million of Lehman’s senior bonds between July 2006 and December 2007, according to the filing, which was made on April 22. Paulson and other senior bondholders are being offered 21.4 cents on the dollar in Lehman’s liquidation plan, filed in January in U.S. Bankruptcy Court in Manhattan.
  • Nasdaq(NDAQ), ICE(ICE) Face Schumer Inquiry on Job Losses Amid Bid for NYSE Euronext(NYX). Nasdaq OMX Group Inc. (NDAQ) and IntercontinentalExchange Inc. (ICE) can add the scrutiny of U.S. Senator Charles Schumer to potential obstacles facing their unsolicited takeover bid for NYSE Euronext. Schumer, a New York Democrat, wrote to the companies asking for data on job losses in their $11.3 billion proposal, according to a letter dated today from Schumer’s office.
  • Silver, Gold Prices Rise to Records on Bets Demand in China Will Increase. Silver and gold surged to records in London on speculation that China will buy precious metals to diversify its foreign-exchange reserves. China, with more than $3 trillion in reserves, plans set up new funds to invest in energy and precious metals, Century Weekly magazine reported, citing unidentified people. Silver for immediate delivery surged to a record $49.79 an ounce, and gold reached $1,518.32 an ounce.
  • Corn, Wheat Advance as Adverse Weather Threatens to Reduce Global Harvests. Corn rose the most in three weeks and wheat jumped to the highest price since February as adverse weather threatened crops from the U.S. to China. Corn fields from Montana to Ohio got more than twice the normal rain over the past 30 days, and April may be the wettest on record in Indiana, Ohio and Illinois, according to T-Storm Weather LLC in Chicago. Dry weather in the southern U.S. Great Plains, China and parts of Europe will increase stress on wheat crops, the forecaster said today in a report. Corn futures for July delivery rose 15.5 cents, or 2.1 percent, to $7.60 a bushel at 10:02 a.m. on the Chicago Board of Trade. A close at that price would be the biggest gain since April 4. The grain has more than doubled in the past 12 months as global production trailed gains in demand for livestock feed and biofuels. Wheat futures for July delivery rose 20 cents, or 2.4 percent, to $8.5475 a bushel on the CBOT, after touching $8.58, the highest since Feb. 22. Before today, the price climbed 67 percent in the past year as drought spurred Russia to ban exports, while floods eroded crops in Canada and Australia.
  • Tepco Pumps Tainted Water From Reactor Trenches, Adds Backup Power Cables. Tokyo Electric Power Co. pumped highly radioactive water from trenches at its crippled nuclear plant, and said it expects to complete installing additional cables to supply backup power to the station’s six reactors.
  • Taliban Helps 500 Prisoners Break Out of Afghanistan Jail. Taliban guerrillas tunneled into the main jail in Kandahar, the southern Afghan city at the center of their fight with U.S. forces, releasing about 500 prisoners including insurgent commanders.
Wall Street Journal:
  • Syrian Military Intensifies Crackdown. At least 35 people were killed across Syria on Monday, as the government escalated its assault on antiregime protesters, according to activist accounts posted on line.
  • Demand Builds for TV Ad Time. As rising gasoline prices and stubbornly high unemployment hold back the U.S. economy, one marketplace still appears to be as hot as ever: TV advertising. For the second consecutive year, marketers are poised to spend more money in advance on commercials for the coming TV season than they did a year earlier, driven in part by unusually high prices for last-minute commercials this spring, according to both buyers and sellers of TV advertising. As a result, the cost of advance commercials, sold in an annual marketplace dubbed the "upfront," is expected to rise sharply.
  • Moody's: Sector Outlooks Make Slow Shift Toward Positive. Moody's Investors Service said global industry sector outlooks moved slightly in a positive direction in the first quarter but remained stable overall.
  • The White House Wants a List. Want a federal contract? Show politicians the money.
Business Insider:
  • Steve Jobs on iOS Location Issue: 'We Don't Track Anyone'. There has obviously been a lot of discussion about last week's disclosure that iOS devices are maintaining an easily-accessible database tracking the movements of users dating back to the introduction of iOS 4 a year ago. The issue has garnered the attention of U.S. elected officials and has played fairly heavily in the mainstream press. One MacRumors reader emailed Apple CEO Steve Jobs asking for clarification on the issue while hinting about a switch to Android if adequate explanations are not forthcoming. Jobs reportedly responded, turning the tables by claiming both that Apple does not track users and that Android does while referring to the information about iOS shared in the media as "false".
24/7 Wall St.:
Dallas Morning News:
  • Texas Factory Activity Continues to Expand But At A Slower Pace. The expansion in Texas factory activity appeared to slow in April as key measures of manufacturing backed off their March levels, the Federal Reserve Bank of Dallas said Monday. The production index of the Dallas Fed’s monthly manufacturing survey fell to eight in April from a reading of 24 the previous month, “suggesting slower growth in output,” the Dallas Fed said.
Rasmussen Reports:
  • Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Monday shows that 22% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty percent (40%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -18 (see trends).
  • OPEC Unlikely to Change Output in June - Delegates. OPEC members with spare capacity are ready to pump above agreed limits if there is a need, but the producer group is unlikely to formally change output targets at a meeting in June, Gulf delegates told Reuters on Monday.
Financial Times:
  • The price of used business jets has remained low even as economies worldwide start to recover from the financial crisis, citing aircraft brokers.
Beijing Times:
  • China Banking Regulatory Commission may this month issue stricter rules on property trusts, after tightening regulations in November, because of a market rebound in March, citing a person from a trust company.

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