STOCK MARKET WATCH, Friday 7 July

[ozymandius]

Friday July 7, 2006

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 929 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2022 DAYS
WHERE'S OSAMA BIN-LADEN? 1722 DAYS
DAYS SINCE ENRON COLLAPSE = 1683
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 6
Other Arrests of Execs = 54


U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON July 6, 2006

Dow... 11,225.30 +73.48 (+0.66%)
Nasdaq... 2,155.09 +1.75 (+0.08%)
S&P 500... 1,274.08 +3.17 (+0.25%)
Gold future... 634.10 +6.80 (+1.07%)
30-Year Bond 5.23% -0.05 (-0.85%)
10-Yr Bond... 5.19% -0.04 (-0.80%)






GOLD, EURO, YEN, Loonie and Silver


PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[ozymandius]

1. WrapUp by Martin Goldberg

TAKING STOCK OF ONE'S SELF

In the last 2 1/4 years, I learned a lot pertaining to writing about the stock market; the most important of which is to refrain about writing about myself and avoid using the words, “I” and “me.” It’s best to keep the author out of the article. But this being my 50th birthday and given that I’ve taken nothing tangible from this assignment save for an Irish flute and a box of apples, I’m going to violate this principle – this article is about me. Now let me state here that although I took nothing tangible away from this job, the intangible personal growth from the on-line and phone conversations with folks I’ve met through this job have been priceless. This has been an enlightening and experience that has helped me view the world in a whole different light. It’s true that with your eyes open, you see some things that are not always uplifting; but all the same, it is best to view the world with your eyes open.

I try to view the stock market in a most unbiased manner. And this is important since one’s own interest can easily taint what is supposed to be an unbiased analysis. At this juncture let me clearly state that the only US company of which I have complete confidence in with regard to producing a high quality product at a fair price with the highest level of integrity is Casey Burns Irish Flutes. Get the point?

-cut-

Then my advice on 28 April 2005 was, “Sell ‘em all!” However, the point of this article was that as investments, investors should “sell ‘em all.” This article spoke to valuations, not the technical case. Anyone could have seen that the market was oversold at the time and due for a technical bounce. (And this was stated in the article.) At the time, there was some thought espoused on the internet that dividend paying stocks were of better pedigree than others, and perhaps a better place to invest one’s money at the time. And while that may have been true to some extent, as investments, with dividends of less than 2%, these stocks did not represent value in most cases. Such is the “Stocks for the Long Run” dogma. As I recall the stock of Tootsie Roll (TR) sticks in my mind as an example of what I was talking about at the time. This stock paid just north of 1% in dividends in April of 2005. Ever had a Tootsie Roll? At a 1% dividend, that’s some investment! TR closed that day at 29.5 and today it’s at about 29.

-cut-

But on balance, I’ve been right more than wrong. (So, maybe you should count me in with those other technicians.) Here are a few quotes from “MARKET NOW HOME ALONE, Predictions for 2005 and 2006”, 22 Dec. 2005, with today’s comments in italics.

http://www.financialsense.com/Market/wrapup.htm

[ozymandius]

2. Today's Reports

8:30 AM Average Workweek Jun
Briefing Forecast 33.8
Market Expects 33.8
Prior 33.8

8:30 AM Hourly Earnings Jun
Briefing Forecast 0.3%
Market Expects 0.3%
Prior 0.1%

8:30 AM Nonfarm Payrolls Jun
Briefing Forecast 190K
Market Expects 160K
Prior 75K

8:30 AM Unemployment Rate Jun
Briefing Forecast 4.7%
Market Expects 4.6%
Prior 4.6%

[UpInArms]

29. 8:30 Reports: NPF @ 121,000 - gamblers lose bigtime

8:30 AM ET 7/7/06 U.S. JUNE AVERAGE WORKWEEK RISES TO 33.9 HOURS

8:30 AM ET 7/7/06 U.S. JUNE AVERAGE HOURLY EARNINGS UP 0.5%

8:30 AM ET 7/7/06 U.S. JUNE FACTORY JOBS UP 15,000; SERVICES UP 106,000

8:30 AM ET 7/7/06 U.S. JUNE RETAIL JOBS DOWN 7,000

8:30 AM ET 7/7/06 U.S. JUNE UNEMPLOYMENT RATE 4.6%, UNCHANGED VS MAY

8:30 AM ET 7/7/06 U.S. MAY NONFARM PAYROLLS UP REV 92,000 VS 75,000 PREV

8:30 AM ET 7/7/06 U.S. JUNE NONFARM PAYROLLS UP 121,000 VS 174,000 EXPECTED

U.S. June nonfarm payrolls rise 121,000; rate stays at 4.6%

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BC031C79F%2D5D45%2D4179%2D8844%2D9E1693030191%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) - Job growth increased modestly in June, the Labor Department said Friday. Nonfarm payrolls expanded by 121,000 in June lower than the 174,000 expected by economists surveyed by MarketWatch. Payroll growth is clearly moderating. In the second quarter, payroll employment growth averaged 108,000, down from 176,000 in the first quarter. The unemployment rate held steady at 4.6%, in line with forecasts. Average hourly earnings increased 8 cents, or 0.5% to $16.70. Economists had been expecting a 0.3% gain. Earnings are up 3.9% in the past year.

[UpInArms]

39. From Yesterday: No error in ADP June report-Macroeconomic Advisers

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=2373953&mesg_id=2374366

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-06T153356Z_01_N06393646_RTRIDST_0_ECONOMY-EMPLOYMENT-ADP-UPDATE-1.XML

NEW YORK, July 6 (Reuters) - There are no miscalculations in the ADP National Employment Report for June, ADP's partner Macroeconomic Advisers said on Thursday, dismissing market rumors of a calculation error in the survey of U.S. private sector employment.

"There is no basis to the rumor. There is no error. We stand by the original number," said Joel Prakken, chairman of Macroeconomic Advisers, which co-produces the report with ADP. He was speaking for both ADP and Macroeconomic Advisers.

Speculation circulated in financial markets on Thursday that the ADP may have miscalculated its June report, after news that the Institute for Supply Management's employment index fell to 52 in June from 58 in May.


ADP released a report on Wednesday estimating U.S. private-sector job growth of 368,000 in June, prompting several investment houses to revise upwards their overall U.S. employment forecasts for June.

A Reuters poll now shows a median June payrolls forecast of 185,000 new jobs, up from about 155,000 before the ADP report.

...more...

Yeah, right - you lying sacks of shit!

We, here at the SMW saw through your cheap spinning lies and called you on it then - now all of you stoopid BushWhack eCONomists have to live with your foolishness and try to scrape the crap off your faces.

:nuke:

[UpInArms]

40. Futures show Fed hike in question on puny payrolls

"puny" - what happened to that "mega" prediction?



http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-07T131554Z_01_N07177247_RTRIDST_0_MARKETS-FEDFUNDS-JOBS-UPDATE-1.XML

CHICAGO, July 7 (Reuters) - Prospects for an August interest rate increase by the Federal Reserve, as shown by short-term rate futures, fell sharply on Friday after a weak reading on June payrolls growth.

The market's view of chances for a Fed rate hike in August fell as low as 54 percent from 70 percent before the report as traders assessed that U.S. economic growth may be slowing.

Chances later edged up to 62 percent.

The Labor Department said 121,000 nonfarm payroll jobs were created in June, far below Wall Street forecasts for 185,000 and recent whisper numbers.

"This is proof positive that the economy is in a decelerating mode," said Richard Yamarone, chief economist at Argus Research in New York.

...more...

They did not whisper that 368,000 prediction! They trumpeted it!

:grr:

[UpInArms]

43. Was there an "early" leak from the BLS???

9:28 AM ET 7/7/06 BLS LOOKING INTO RUMORS OF EARLY RELEASE OF JOBS REPORT

9:28 AM ET 7/7/06 NO EVIDENCE PAYROLLS NUMBER LEAKED EARLY: LABOR DEPARTMENT

[UpInArms]

45. No evidence payrolls number leaked, Labor Department says

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B22E97351%2D8725%2D4DB7%2DA102%2D307DC044473B%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- The Labor Department has no evidence that the June payrolls number was leaked before the 8:30 a.m. Eastern release time, a spokesman said Friday. The Bureau of Labor Statistics is looking into rumors that the numbers were leaked, the spokesman said. "We have no evidence that the BLS released it early," said Gary Steinberg, a BLS spokesman. As for rumors that someone else may have leaked it, "no one has anything solid, just rumors," Steinberg said. On Friday, the BLS reported that nonfarm payrolls rose by 121,000 in June, less than the 175,000 expected by private economists. Financial markets reacted vigorously to the report.

With all of the insider trading deals and the cross-over of financial types to government jobs under this mal-administration that leaks whatever it wants and prosecutes everything it finds politically embarrassing, a leak from their lying BLS would not surprise me in the least.

[Roland99]

69. Mrs. Sonovabitch McConnell is Sec'y of Labor.....

[ozymandius]

3. Oil prices drop below $75 a barrel in Asia

SINGAPORE - Oil prices fell below $75 a barrel Friday after a U.S. weekly petroleum supply snapshot showed an unexpected increase in domestic gasoline stocks. But geopolitical tensions and rising gasoline demand continued to support prices, traders said.

Light, sweet crude for August delivery fell 34 cents to $74.80 a barrel in Asian electronic trading on the New York Mercantile Exchange. The contract slipped 5 cents to settle at $75.14 a barrel Thursday.

-cut-

In its weekly inventory report, the U.S. Department of Energy said the country's supply of gasoline unexpectedly rose by 700,000 barrels to 213.1 million barrels. That level is 1.4 percent lower than a year ago.

But the department also said U.S. gasoline consumption over the past four weeks averaged 9.5 million barrels a day, or 1.4 percent more than a year ago, the department said.

more

[ozymandius]

4. Oil may fuel Sino-US conflict

Flynt Leverett, senior fellow at the New York-based Saban Centre for Middle East Policy, told Aljazeera.net: "There’s a force of increasing tensions in the Sino-American relationship and if you carry that trend out long enough, you do begin to run a more serious threat."

As the dominant geopolitical power in the Middle East and the Arabian Gulf, America's main concern is not only the acquisition of cheap fossil fuel but also the growing involvement of China's energy sector in a number of ''problem" states such as Iran, Sudan and lately, Syria.

-cut-

Investing in Sudan

China has invested more than $8 billion in Sudan, which now supplies over 7% of the Asian giant's oil. It has also invested another $70 billion into Iran's oil and gas industry, which meets 11% of its energy needs.

-cut-

China-US rivalry

The IEA predicts that by 2015, 70% of China’s oil imports will come from the Middle East. And more than half of its oil will have to transit the Malacca Straits, one of the busiest shipping lanes in the world, located between Malaysia, Singapore and Indonesia.

more

[ozymandius]

5. New green firm may be ripe for oil company takeover

D1 Oils, the start-up company hoping to develop biodiesel from the jatropha plant, is in takeover talks - the latest signal that alternative energy has become a sought-after sector.

Shares in the company rose 10% to 304p yesterday - on top of a 7% increase the day before - amid speculation that a large oil company had declared its interest in the firm.

-cut-

D1 came to prominence when it signed an innovative deal to create biodiesel for the world's biggest crude oil exporter, Saudi Arabia. Since then it been building a series of four small refineries in Middlesbrough and hopes to have 32,000 tonnes of capacity onstream by the end of September. A further five are already planned. They will be all be fed by 42,000 hectares of jatropha plants under cultivation in Africa, India and south-east Asia. The company has virtually no revenues yet but a considerable cost base, making it a speculative investment.

-cut-

Both the country's largest oil companies, BP and Shell, have been pressing ahead with various kinds of biodiesel projects, spurred on by European Community demands that 5% of all vehicle fuel should come from carbon-free sources.

more

[4dsc]

15. Oil will hit well over $100 and stay high: Rogers

The calm before the storm..


http://today.reuters.com/business/newsarticle.aspx?type=ousiv&storyID=2006-07-06T103410Z_01_L06887107_RTRIDST_0_BUSINESSPRO-ENERGY-ROGERS-DC.XML

Oil prices will soar to well over $100 a barrel and stay high as part of a sustained commodities bull run that has another 15 years to run, billionaire U.S. investor Jim Rogers told Reuters in an interview.

One factor that could bring down the price would be a bird flu epidemic, which would send all asset classes plummeting, he said, although oil would probably fall less than other markets.

"We're going to have high oil prices for a very long time. The surprise is going to be how high it goes," Rogers said.

Reiterating earlier comment oil prices would hit at least $100 a barrel, he said: "It will be much more than $100 before the bull market is over."

[niallmac]

37. Well if oil hits and stays at $100 for 15 years...

then of course aftewards it will settle down to $20. a barrel yes? NOT!

[UpInArms]

24. Crude Futures hit $75.73 bbl

8:08 AM ET 7/7/06 AUGUST CRUDE FUTURES TOUCH INTRADAY RECORD OF $75.73/BBL

[Eugene]

25. Oil hits record above $75 on strong demand

Oil hits record above $75 on strong demand

By Alex Lawler
Reuters
Friday, July 7, 2006; 8:05 AM

LONDON (Reuters) - Oil hit a fresh record high of $75.70 a barrel on Friday
after a U.S. government report showed strong fuel demand in the world's top
oil consumer.

-snip-

Gasoline demand in the United States gained by 1.4 percent in the last four
weeks from a year ago, a government report said on Thursday. With demand still
growing, investors doubt oil's 4-1/2 year rally has come to an end.

more

[UpInArms]

27. Crude futures set fresh record on supply, Korea concerns @ $75.78 bbl

http://www.marketwatch.com/News/Story/BT1ZNhnBN4vDkdmw8bG8tNQ?siteid=mktw&dist=morenews

NEW YORK (MarketWatch) -- Crude-oil futures rose to a record $75.78 a barrel early Friday as traders continued to digest U.S. data showing a bigger-than-expected drawdown in crude inventories while keeping an eye out for news from North Korea and Iran.

Crude for August delivery was last up 62 cents at $75.73 a barrel in electronic trading, after earlier touching a high of $75.78, a record for a front-month contract.

On Thursday, the contract closed just short of the prior day's record finish after a choppy session. Crude prices fell as low as $74.30 immediately after the data were released before recovering almost of their losses by the close.

The latest data were "bullish for crude oil, neutral for gasoline (the build in inventories was offset by strong demand data) and moderately positive for distillates," said Bruce Lanni, analyst at A.G. Edwards, who earlier raised his oil price forecast for 2006.

The Energy Department said crude supplies fell 2.4 million barrels for the week ended June 30, to a total of 341.3 million. It marked the second weekly decline in a row, though supplies were still 3.6% above their year-ago level, according to government data.

<snip>

Against this background, gasoline futures were last trading up 0.5 cent at $2.2635 a gallon. Heating oil was up 0.7 cent at $2.069 a gallon and natural gas was up 2 cents at $5.685 per million British thermal units.

...more...

[UpInArms]

30. Farewell to $60 oil; Brace yourself for $80

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B19065F21%2D1BF5%2D4C0B%2DACB8%2DADCEE6970B3B%7D&symbol=

SAN FRANCISCO (MarketWatch) -- Crude's back at record levels, with the $60-per-barrel price we saw just last year out of the picture for now, maybe even forever, and $80 oil a real possibility by the end of the summer.

"Producers and consumers alike should get used to the fact that oil prices will likely never fall below $60 a barrel again," said Emanuel Balarie, a senior market strategist at Wisdom Financial.

The front-month contract for crude futures closed at $75.19 a barrel Wednesday in New York -- the highest closing price ever and the price rally has not stopped there as a world of political turmoil, direct threats to production and supplies and a strong global appetite for oil come together to rattle investors' nerves.

"Whether it be tension with Iran and North Korea, war in Iraq, summer gasoline demand, refinery outages, prices are going to be very sensitive to supply disruptions and/or perceived potential disruptions," said Thomas Hartmann, an analyst at Altavest Worldwide Trading.

The oil market has been factoring in daily news related to the nuclear standoffs between Western nations and Iran and North Korea. See the latest Futures Movers column.

At the same time, the market is routinely bombarded by strong demand figures for oil from countries around the world, especially China. Refinery outages, the recent closure and reopening of a key waterway in Louisiana and storms in the Atlantic also serve as reminders of oil's fragile supply system.

...more...

[Roland99]

46. If risk is already factored in (as oil has TRIPLED since Jan. 2001) then..

how can further risk continue to be factored in?

Perhaps it's just my ignorance re: the way oil futures/contracts are traded but, to me, it doesn't appear to be much different from trading commodities like pork bellies or corn. Oil supplies from OPEC and other countries are flowing freely. Refining hasn't really been affected.

It appears to be just fear stoking the price rise.

Or, is there something more fundamental? Surely China's increase in demand hasn't caused a tripling in oil prices in 5 years. OR has it?

[Bushwick Bill]

51. No spare capacity.

And what little spare capacity exists is increasingly heavy sour crude, which apparently many refineries are not set up to handle. Check out this presentation from a Bush energy insider Matt Simmons. He is one of the top energy investment bankers in the world and has gone straight to doomer land, which is very scary.
http://www.simmonsco-intl.com/files/Energy%20Conversation.pdf

[Roland99]

87. Wouldn't the oil companies at least be wise to peak oil?

Wouldn't they be planning on future energy sources lest they go the way of whip and buggy companies?

[Roland99]

65. "consumers are not hurting w/gasoline prices at a national avg near $2.93"

:wtf:


Just because demand may be staying at the same levels as people continue to buy gas, it's because it's a NECESSITY for practically everyone in America in order to get to work, school, doctor, grocery, etc.

What this article's "expectations" completely miss is what are consumers cutting back on in order to continue putting gas in their vehicles.

[UpInArms]

61. Commentary: Triple-digit oil is inevitable

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7BF39CFD36%2D79E0%2D4AC0%2D8E03%2D72C2A9BD15F3%7D&symbol=

NEW YORK (MarketWatch) -- Oil at $100 a barrel? Oh yes, and like most milestones, this is one that you are not likely to forget.

As we stand on the precipice of such lofty prices, I understand that there are those who believe that $100 oil is pure nonsense.

We've been watching oil very closely. At $40 we said crude would hit $60. At $50 we said it would hit $75 within a year. Some scoffed and called me a fear monger. Now that we're at $75, I'm telling you that under the right conditions oil could not only hit, but sustain a $95 to $110 price per barrel by the end of the year. I say it's not only likely, but almost inevitable within 12 months.

Now before I get flooded with e-mail from those who believe oil is going back down to $35, let me lay out my case before you hit the send button.

Fill 'er up for a trip down memory lane

In 1967, the year of my birth, gasoline was around 33 cents a gallon. I was reminded of this when a friend sent me a birthday card that tells you how much stuff cost when you were born: A bar of soap was 2 cents, a movie was 60 cents, and you could buy a three-bedroom house for $16,000. It was the most depressing card I have ever gotten -- and it was an eye opener too. Prices climb, that's what they do. And nothing climbs faster than a finite commodity that is in low or declining supply and in growing and high demand.

...more...

My first "fill-up" was at 19 cents a gallon. Damn! I'm old! :D

[ozymandius]

6. Experts see Lay's death erasing conviction

HOUSTON - The death of Enron Corp. founder Kenneth Lay will likely cause his conviction to be erased from the record, experts said Thursday.

The 64-year-old executive's sudden death Wednesday from heart disease allows his lawyers to ask the court to vacate his conviction for fraud and conspiracy in Enron's scandal that left thousands jobless and wiped out billions from investors.

What will become of his money and assets, however, is still unclear. If his conviction is erased, that would thwart the government's effort to seize millions prosecutors say he gained from participating in Enron's fraud.

The government wants $43.5 million. Prosecutors suggested he could apply his $5 million condominium and a $6.3 million investment toward that sum. During his criminal trial earlier this year, Lay said he has little else left and still owes his lawyers.

more

[UpInArms]

14. Merrill Lynch Settles an Enron Fraud Lawsuit for $29.5 Million

http://www.nytimes.com/2006/07/07/business/07enron.html?ex=1309924800&en=df1b4ca87c1fba62&ei=5088&partner=rssnyt&emc=rss

(free registration or try www.bugmenot.com)

HOUSTON, July 6 — Merrill Lynch agreed on Thursday to pay the Enron Corporation $29.5 million to settle its portion of a lawsuit filed against 10 banks accused of failing to prevent Enron's collapse.

Merrill Lynch — which did not admit or deny wrongdoing — said it settled the so-called mega-claims lawsuit to avoid the costs and uncertainties of more litigation.

Merrill Lynch also agreed to give up collection of $73.7 million in claims against what is left of Enron but could receive about $10 million in other claims that were outside the settlement, according to an Enron spokeswoman.

In 2003, Merrill Lynch paid the Securities and Exchange Commission $80 million to settle civil charges that the firm participated in Enron's bogus sale of floating power plants, which made it appear that Enron had met its goals for earnings in 1999.

...more...

[UpInArms]

17. Why Should Lay's Death Erase Convictions? It Would Continue the Rip-Off

http://www.reformer.com/editorials/ci_4022646

excerpt:

Until Enron's collapse, Lay had been Bush's top political patron.

According to the Center for Public Integrity, Lay and his company gave Bush a total of $623,000 for his 1994 and 1998 gubernatorial campaigns in Texas and his 2000 presidential campaign. Lay had been a reliable source of campaign money for the Bush family since the 1970s.

Lay and Enron showered millions on other Republican politicians. Despite the GOP camp followers' attempts to make this a bipartisan scandal, Enron gave 73 percent of its $5.8 million in campaign contributions to Republican candidates from 1989 to 2001, again according to the Center for Public Integrity.

So what did Enron get for its money?

* When Bush was still governor in Texas, he deregulated that state's energy markets and lobbied on behalf of Enron to convince other states to follow Texas' lead.

* Enron was allowed to price-gouge Californians in 2000 and 2001 when President Bush and the Republican Congress refused to impose federal price controls. This cost California up to $50 billion in extra energy costs and put the state government into a financial crisis it has yet to recover from.

* Lay had at least six meetings with Vice President Dick Cheney or staff from Cheney's energy task force in 2001. The last meeting came in October 2001, a week before Enron's announcement that it was reducing shareholder equity by $1.2 billion to cover company losses in its now infamous off-the-balance-sheet partnerships. Five years later, Cheney has yet to release the minutes from any of his energy task force meetings, despite requests made by Congress. Needless to say, the national energy policy drafted by Cheney's group was pro-corporate, pro-deregulation and anti-conservation.

...more...

[ozymandius]

7. Insurers put London stocks under pressure

London equities fell in early trade on Friday, with life insurers under pressure after Aviva confirmed it was in talks to buy a US peer and traders were in cautious mood ahead of influential American employment data.

The FTSE 100 started the day 0.2 per cent weaker at 5,878.0 with the mid-cap FTSE ticking 0.1 per cent higher to 9,469.9.

New York indices closed in positive territory overnight, as the tobacco sector rose after a favourable legal ruling. The Dow Jones Industrial Average closed up 0.7 per cent at 11,225.30. Investors' attention was ready to return to the US for the closely-watched non-farm payrolls number due out at 1330 London time. The job-creation data is widely thought to provide one of the best indications into the performance of the world's biggest economy.

Back in London, and life insurance companies took centre stage after Aviva confirmed an FT report that it was in talks relating to a potential offer for US peer AmerUS. The potential spending spree sent shares in the operator of the Norwich Union brand down 2.7 per cent to 733p.

more

[ozymandius]

8. $145 billion penalty vs. big tobacco is dismissed

TALLAHASSEE, Fla. - The fortunes of U.S. tobacco companies improved with the Florida Supreme Court's decision Thursday to dismiss a $145 billion punitive damage award. Yet that same ruling also clears the path for individual smokers to file their own suits.

The ruling, one of the last remaining personal-injury class-action cases against tobacco companies, is a crushing blow to plaintiff's lawyers, who have pushed for large class-action cases with the potential for multibillion-dollar verdicts.

The six-judge Florida court stated that smokers' cases ``are highly individualized'' and ``do not lend themselves to class-action treatment.''

-cut-

Shares of the two largest companies named in the suit -- Altria, the parent of Phillip Morris, and Reynolds American, which owns R.J. Reynolds -- were up sharply. Altria closed up $4.43, or 6 percent, at $77.76 and Reynolds American closed up $4.59, or 4 percent, at $118.95.

http://www.mercurynews.com/mld/mercurynews/business/14985622.htm

[ozymandius]

9. AOL Said to Be Planning Free Ad-Based Web Access

AOL is putting the final touches on a plan that would stop marketing its subscription service, which for more than a decade has been the most popular way that Americans connect to the Internet, according to a senior AOL executive close to the plan's development.

Instead, it will redouble its efforts to build a free, advertising-supported business on the Web, offering current and former members access to the most popular features of its paid service — including e-mail addresses at AOL.com, free virus protection, and use of AOL's software program.

The plan would save hundreds of millions of dollars a year in marketing costs and involve layoffs of thousands of AOL's 19,000 employees, said the executive, who would not speak for attribution because the details of the plan have not been completed.

-cut-

As of March 31, AOL had 18.6 million subscribers, including 6 million connecting mainly through high-speed connections. The overall number declined by 850,000 in the first quarter and by 3.1 million in the 12-month period.

http://www.nytimes.com/2006/07/07/technology/07aol.html

[ozymandius]

10. Slow Growth in Retail Sales Spurs Concern

NEW YORK — Retail sales growth stalled in June, leaving merchants wondering whether shoppers who were resilient for much of the year are curbing their spending because of higher gasoline prices.

As merchants issued their sales reports Thursday, disappointments included Wal-Mart Stores Inc. and Federated Department Stores Inc., which fell short of analysts' forecasts. Those that exceeded expectations included Target Corp. and J.C. Penney Co.

Rainy weather that wiped out demand for summer clothes also hurt sales at some retailers. And many merchants had to compare their results against very strong business a year earlier, making this year's sales look slightly weaker than they really were.

Still, some analysts said they saw a loss of sales momentum.

more

[Buttercup McToots]

12. The Leverage in the System and the Weak US Dollar

Longish but interesting...
Here is link to the whole article...

http://www.investorsinsight.com/otb_va.aspx?EditionID=344



>snip
In recent years, we have seen large amounts of US$ borrowing taking place outside of the US. This means that an improvement in the US current account deficit could trigger a massive economic crisis; all the guys who are short would find themselves unable to earn the US$ to service their debt. So policy makers should be careful what they wish for... for if they get it, they won't like it!

>snip
So putting it all together, we currently have a nice merry-go round in the financial markets whereas:

1) Oil prices increase, leading to

2) Large US$ borrowing from oil importers to pay for the rise in oil, so

3) Large amounts of "borrowed US$" are received by oil producers who

4) Sell the US$ either for rational diversification or irrational policy, leading to

5) A growing perception that the US$ can only fall, which, in turn re-enforces the willingness to borrow US$ (Point #2)... and off we go around the merry-go round again.

[ozymandius]

11. GM fury at push by Kerkorian

Growing distrust between General Motors' top management and the US carmaker's biggest individual shareholder is emerging as a potential barrier to an alliance with Renault and Nissan, the French and Japanese carmakers jointly run by Carlos Ghosn.

Kirk Kerkorian, the octogenarian billionaire who has a 9.9 per cent stake in GM, wants the company to hire an independent outsider to assess a possible deal, say people familiar with his thinking.

But Rick Wagoner, chairman and chief executive, is furious at the way Mr Kerkorian bounced GM into early consideration of the deal by disclosing the interest of Renault and Nissan in a regulatory filing last Friday, say several insiders.

-cut-

The possible deal remains at a very early stage, and no details have yet been worked out. But Mr Kerkorian's discussion with Mr Ghosn centred on Renault and Nissan buying a combined 20 per cent stake in GM through newly issued shares, which would inject $3.3bn into the troubled carmaker.

more

[UpInArms]

13. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

Last trade 85.27 Change -0.10 (-0.12%)

Non Farm Payrolls - Will there be a Repeat of July 2004?

http://www.dailyfx.com/story/dailyfx_reports/daily_fundamentals/Non_Farm_Payrolls___Will_1152220197574.html

US Dollar
The US dollar has given back some of its gains as we head into Friday’s non-farm payrolls release. The strong ADP employment forecast from yesterday had many traders believing that we would see exceptionally strong job growth in the month of June. However, such optimism was put to test today after the release of the ISM non-manufacturing index. The service sector activity index moderated from 60.1 to 57.0, but this was not the main concern. Instead, it was the sharp drop in the employment component of the report from 58 to 52 that has the market now worried about whether the ADP numbers were correctly calculated. The last time we saw a drop this large was between June and July of 2004 and looking back to the month of July, non-payrolls were an abysmal 38k. Coincidently enough, the forecast at the time was 240k. Today, the forecast is not as large, but just as optimistic which raises the question of what we should believe more – the ISM or the ADP report? If you recall, on Monday, the employment component of the ISM manufacturing index also fell from 52.9 to 48.7 but analysts wrote that off as having an impact on the manufacturing portion of the payrolls report and not the headline index. However, now with the expansion in the service sector labor market moderating significantly as well, a potentially weaker number is just as likely as a stronger one. The two conflicting reports tell us that there will certainly be a lot of volatility tomorrow and raises the likelihood of payrolls coming out somewhere between 140-180k, which is not far from the market’s forecast. We do not think that it is going to be as horrid as the July 2004 number since jobless claims have been very low. Just today, we saw another print below 325k at 313k for the week ending July 1st. As we said yesterday, handicapping the report is really a coin toss and we prefer to concentrate on our reaction to the release. A weak number will probably have the most significant impact on the EUR/USD currency pair after today’s extremely hawkish comments from the European Central Bank, but also be careful of any revisions for the month of May. For a more detailed pre-nonfarm payroll analysis, see the special report section of www.dailyfx.com.

...more...

Tomorrow's Economic Releases: Payrolls Across The World

http://www.dailyfx.com/story/calendar/key_events/Tomorrow_s_Economic_Releases__Payrolls_Across_1152221236834.html

US Change In Nonfarm Payrolls (JUN) (12:30 GMT, 08:30 EST)

Consensus: 175,000
Previous: 75,000

Outlook: United State's unemployment is expected to once again print a low 4.6 percent in June. Recent releases however that relate to the health of the employment sector have been mostly promising. Over the past few days, two proprietary job reports have reported solid numbers for June. First, hitting the newswires Wednesday was the fledgling ADP indicator, which reported an additional 368,000 hires for the month. This compares to the consensus among economists for a 175,000 print in non-farm payrolls Friday. The next figure to cast a vote for a surprisingly strong BLS jobless figure last month was the online Monster Index, which ticked 4 points higher to a 171 read. Perhaps the most convincing data for stronger than expected employment numbers, as it is compiled by the government, was jobless claims. Initial claims averaged 307,000 people over the five weeks in June compared to an average 335,000 the month before when payrolls grew only 75,000. Then again, not every indicator is supporting a boom in employment. A component read of the ISM services survey showed a large jump in its respective job read, which has not been seen since July 2004 when payrolls fell far short of the general market prediction.

Previous: Payrolls grew 75,000 in May, leaving the jobless rate steady at the historically low 4.6 percent. Jobs were created in the service and mining industries, but that was offset by a loss in retail and manufacturing sectors. This may be a sign that the Fed's attempts to cool the economy and inflation with its streak of rate hikes may finally be taking their toll on the labor market. Overall unemployment remained very low, but fewer and fewer jobs are being added to the economy as companies feel the combined pressure of higher borrowing costs and rising energy prices that leaves little capital for increasing human resources. A decline in employment was specifically seen among temporary workers, which could have been a signal of a softening employment market as temp employees are generally the first to be hired or fired when confidence changes.

...more...

China's yuan ends at new high on rate rumors

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7BA5C667BF%2D8F97%2D4F82%2DBDC5%2D38C0B0F2D4B5%7D&symbol=

HONG KONG (MarketWatch) -- China's yuan ended higher against the dollar Friday, as the greenback fell below the 7.99 level for the first time since Beijing revalued its currency a year ago, with traders fuelled by talk of an emergency meeting at China's central bank.

The dollar ended at 7.9859 yuan in over-the-counter foreign exchange trading, after trading in a relatively wide range of 7.9850 yuan to 7.9968 yuan throughout the day.

Spokesmen at the People's Bank of China denied any special meetings took place today, but the assurances failed to quell speculation the central bank may be planning additional policy changes.

Traders said they expect the PBOC will raise interest rates in the near future in an effort to cool the overheated economy.

"There is appreciation anticipation in the market," said research director with GF securities in Guangzhou, William Hang. "There is expectation in the market about the PBOC raising interest rates, maybe sooner than later."

He added the market appeared to be expecting a rate hike in the second half of the year roughly in line with the 27 basis point hike in the one-year lending rate in late April. The April hike was the first by the PBOC since Oct 2004.

"The trade surplus is still growing and the pile of money in terms of foreign exchange reserves is also growing, so the PBOC must do something to relieve the pressure," Hang said.

...more...

[UpInArms]

32. Dollar falls sharply after weak jobs data

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B3588F108%2D913D%2D4AC8%2DB5BE%2DB96B3E62BC0E%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) - The dollar moved sharply lower early Friday following much weaker than expected nonfarm payrolls data. Nonfarm payrolls expanded by 121,000 in June, lower than the 174,000 expected by economists surveyed by MarketWatch. Payroll growth is clearly moderating. In the second quarter, payroll employment growth averaged 108,000, down from 176,000 in the first quarter. The unemployment rate held steady at 4.6%, in line with forecasts. Average hourly earnings increased 8 cents, or 0.5% to $16.70. Economists had been expecting a 0.3% gain. The euro was last up 0.5% at $1.2831, while the dollar was down 0.9% at 114.21 yen.

[UpInArms]

38. peeking at the sinking buck

Last trade 84.82 Change -0.55 (-0.64%)

Settle Time 15:00 Open 85.38

Previous Close 85.37 High 85.41

Low 84.78 2006-07-07 08:42:39, 30 min delay

[UpInArms]

16. Countersuit by Hollinger Claims Fraud

http://www.nytimes.com/2006/07/07/business/media/07hollinger.html?ex=1309924800&en=8e6d68150bf9149f&ei=5088&partner=rssnyt&emc=rss

Hollinger Inc. said yesterday that it was countersuing the newspaper publisher Hollinger International in Federal District Court in Chicago, contending there was fraud in the transfer of two newspapers to the publisher in the late 1990's.

Hollinger claims Hollinger International participated in a scheme to acquire The Daily Telegraph of London in 1995 and several Canadian newspapers in 1997 at prices "far below fair value," according to a statement.

This was part of a plan to reduce Hollinger to a holding company with no operating assets and allow a minority owner, the Ravelston Corporation, to become its controlling shareholder without expending any of its funds, Hollinger said.

Hollinger's claim "that it allowed itself to be 'defrauded' in transactions with an entity that it majority-owned, dominated and controlled is both factually implausible and legally without merit," Hollinger International's chief executive, Gordon A. Paris, said in a statement.

Hollinger also sued Ravelston, once controlled by Conrad M. Black, in Ontario Superior Court to seek the equivalent of more than $650 million for damages ranging from breach of contract to unjust enrichment.

...more...

[UpInArms]

18. Carlyle raises $1.9 bln for Japan buyouts

http://news.yahoo.com/s/nm/20060707/bs_nm/financial_carlyle_japan_dc

TOKYO (Reuters) - Global private-equity firm The Carlyle Group (CYL.UL) said on Friday it has raised 215.6 billion yen ($1.9 billion) for the largest ever Japan-dedicated buyout fund.

Approximately half of the fund, Carlyle Japan Partners II, came from Japanese investors. Reuters reported on June 20 that Carlyle was closing the fund, citing industry sources.

Carlyle's first Japan buyout fund was established in 2001 at 50 billion yen and has made seven investments in sectors including healthcare, industrial equipment, automobiles, business outsourcing, media and telecommunications.

Its portfolio companies in Japan have included mobile services firm Willcom Inc. and crane maker Kito Corp.

"The environment surrounding Japanese corporations is drastically changing amid intense global competition, increasing pressures from investors, as well as ongoing legal and tax reforms," said Tamotsu Adachi, Carlyle's Managing Director and Head of the Japan Buyout Group.

...more...

hmmm.... established in 2001 ... hmmm...

[UpInArms]

19. Cingular accused of deceiving customers

http://news.yahoo.com/s/ap/cingular_lawsuit

SEATTLE - Cingular Wireless Corp. promised to provide uninterrupted service to AT&T Wireless customers when it acquired that company in 2004, but instead it nickel-and-dimed them and degraded their reception in an effort to persuade them to sign new contracts, a federal lawsuit said Thursday.

The lawsuit, which alleges breach of contract and violations of consumer protection laws, seeks class-action status on behalf of the more than 20 million customers AT&T Wireless had at the time of the merger. Many paid $18 "transfer" fees to switch to Cingular plans and were required to buy new phones or pay other fees, said the complaint filed in U.S. District Court in Seattle.

"Everyone who signed an AT&T contract had their service degraded," attorney Mike Withey said at a news conference Thursday.

Atlanta-based Cingular acquired Redmond-based AT&T Wireless Services Inc. for $41 billion in October 2004, and promised in advertisements and news releases that the customers of both companies would see uninterrupted and even improved service as a result of the "combined network."

<snip>

Last month, a California state appeals court upheld a $12.1 million fine against Cingular for signing up customers faster than it could provide service and for imposing hefty cancellation fees without a trial period. The court also said Cingular must refund up to $10 million to people who were forced to pay as much as $550 to cancel their contracts.

...more...

[UpInArms]

20. AMD slashes sales forecast

http://today.reuters.com/news/newsarticle.aspx?type=businessNews&storyid=2006-07-07T031728Z_01_WEN0725_RTRUKOC_0_US-AMD-OUTLOOK.xml&src=rss

NEW YORK (Reuters) - Computer processor maker Advanced Micro Devices Inc. (AMD.N: Quote, Profile, Research) on Thursday warned that second-quarter sales would miss expectations as price cuts by rival Intel Corp. (INTC.O: Quote, Profile, Research) on chips to power desktop PCs hampered demand.

The No. 2 chipmaker now expects second-quarter sales to fall 9 percent from the first quarter, short of its previous forecast for flat to slightly lower sales compared to the prior quarter.

AMD has been locked in a battle over market share with top microprocessor maker Intel, which has been aggressively cutting prices to clear inventories and win back customers.

Sales of entry-level and mainstream mobile and desktop processors were down for the quarter, the company said.

"They saw revenues decline in low-end and mid-end systems," said Doug Freedman, analyst at American Technology Research. Freedman has "buy" ratings on both Intel and AMD. "Intel continues aggressive pricing in those market segments."

...more...

[UpInArms]

26. Intel slips in pre-open; analysts trim forecasts

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B3911A789%2D88AC%2D4707%2D955A%2D6CB5AE72C18B%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- Shares of Intel (INTC : 18.85, +0.10, +0.5% ) slipped nearly 1% in pre-open trading after analysts lowered their forecasts for the chipmaker's second quarter following a warning from rival Advanced Micro Devices (AMD : 23.83, -0.07, -0.3% ) that revenue would fall short of forecasts. Thomas Weisel Partners analyst Eric Gomberg cuts his earnings estimate to 13 cents a share from 14 cents and his revenue forecast to $8.22 billion from $8.33 billion. Gomberg expects "disappointing" gross margins, which he expects to fall 6.40 percentage points sequentially, due to weaker-than-anticipated PC demand and aggressive pricing. Prudential analyst Mark Lipacis lowered his second-quarter earnings estimate to 10 cents a share from 11 cents and now expects revenue to be down 11% sequentially to $8 billion, or at the low end of the company's forecasted range. Intel's stock, a component of the Dow industrials, was down 15 cents, or 0.8%, at $18.70. Meanwhile, rival AMD was shedding 4.7% to $22.72.

[UpInArms]

21. Paulson to be sworn in July 10

http://news.yahoo.com/s/nm/20060706/bs_nm/economy_paulson_dc

WASHINGTON (Reuters) - Former Goldman Sachs Chairman Henry Paulson will be sworn in on Monday as the new U.S. Treasury Secretary, the White House said on Thursday.
The U.S. Senate has confirmed Paulson, 60, to replace
John Snow, who stepped down from Treasury last week after nearly 3-1/2 years in the job.

Seeking to lend more prominence to its economic message, the Bush administration had worked hard to court Paulson, a highly respected figure on Wall Street who had chaired Goldman Sachs since May 1999.

[UpInArms]

22. SEC official: some backdating "clearly illegal"

http://today.reuters.com/news/newsarticle.aspx?type=businessNews&storyid=2006-07-06T213845Z_01_N06419896_RTRUKOC_0_US-ACCOUNTING-OPTIONS-SEC.xml&src=rss

WASHINGTON (Reuters) - Some stock options backdating now being investigated by the U.S. Securities and Exchange Commission was "clearly illegal," a departing SEC commissioner said on Thursday.

Cynthia Glassman, a Republican who will leave the SEC next week after nearly 4-1/2 years as a commissioner, did not identify any companies the SEC is investigating, or when enforcement actions might be brought.

"What I will say about the backdating issue is some of the conduct appears to have been clearly illegal," Glassman said in what is expected to be her final public appearance as a commissioner.

She noted that companies' disclosure of options practices is one of the central issues in the widening probe and the SEC is "looking into whether or not the conduct was appropriate."

Glassman's comments were some of the strongest to date from officials investigating more than 50 companies to determine if their option granting practices violated the law.

Although the SEC and Justice Department have declined to confirm or deny any specific investigations, the probes have been disclosed in company filings and announcements. Companies that have said they are being investigated range from insurer UnitedHealth Group Inc. (UNH.N: Quote, Profile, Research), which has warned it may have to restate earnings by up to $286 million, to technology companies such as Monster Worldwide Inc. (MNST.O: Quote, Profile, Research).

At issue are concerns whether companies manipulated the grant dates of options to boost their value to executives who received them.

...more...

[UpInArms]

23. University of Texas Medical Branch layoffs placed at 720

http://www.chron.com/disp/story.mpl/business/4029953.html

The head of the University of Texas Medical Branch predicted that its plan to cut 1,000 jobs will require about 720 people to be laid off, with other reductions coming through attrition and transfers.

The Galveston institution, the second-largest hospital in the Houston area behind Memorial Hermann Healthcare System, said recently it planned to eliminate as many as 1,000 jobs. That is equal to 1,300 full-time equivalent positions because some of those losing their jobs work more than 40 hours a week, according to a UTMB spokeswoman.

John Stobo, the hospital's president, estimated attrition and transfers will reduce the job loss. About 80 of 400 open jobs likely will be filled by people whose positions are disappearing. About 200 of the 1,000 jobs targeted probably will be left open after people quit or retire.

UTMB said most of those losing their jobs will get the news by Aug. 1.

The plan addresses a vexing problem: UTMB is faced with quickly rising costs at a time when its patient revenue growth is limited.

...more...

[Gregorian]

52. Not just in Texas, folks.

Both hospitals in the last two places I've lived, did this. And they both played out the same way. Fire the expensive and experienced doctors, then hire young, inexperienced, and typically immigrant doctors.

Both hospitals were hiring young doctors from India.

[UpInArms]

28. Dice Rolling Continues: Derivative traders see June US payrolls at 205,500

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-07T121430Z_01_NYG000273_RTRIDST_0_ECONOMY-PAYROLLS-DERIVATIVES-URGENT.XML

NEW YORK, July 7 (Reuters) - Traders are betting on Friday that U.S. employers added about 205,500 jobs in June in the final of four derivatives auctions, according to data from the firms holding the auction.

The results were slightly higher than the 198,600 jobs predicted in an auction on Thursday afternoon. Traders have boosted their expectations for the payrolls numbers this week after an ADP National Employment Report on Wednesday showed a 368,000 job gain in the private sector in June.

The U.S. Labor Department will issue the June payroll report on Friday at 8:30 a.m. (1230 GMT).

The derivatives auction on Friday covered a wide range of expectations, with a payroll gain of 125,000 to 250,000 drawing about 52 percent of trader's bets.

The latest median forecast of economists polled by Reuters predicted a 185,000 job increase in nonfarm payrolls following a 75,000 gain in May. Prior to the ADP report, the median forecast for the Reuters poll was a 155,000 increase.

...more...

[UpInArms]

31. Treasury prices leap higher after June jobs report

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B6768361F%2DE623%2D4C49%2D8FC3%2DEDBC0A012B9A%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) - Treasury prices leapt higher early Friday, pressuring yields, after the Labor Department reported a much weaker-than-expected increase in jobs last month. The benchmark 10-year note last was up 8/32 at 99-25/32 with a yield of 5.155%, down from 5.172% immediately before the report. Prices and yields move in opposite directions. Friday. Nonfarm payrolls expanded by 121,000 in June lower than the 174,000 expected by economists surveyed by MarketWatch. The unemployment rate held steady at 4.6%. The report also showed wage inflation: average hourly earnings increased 8 cents, or 0.5% to $16.70. Economists had been expecting a 0.3% gain.

[UpInArms]

33. US rate futures cut Fed rate hike chance on payrolls

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-07T123627Z_01_CHB000194_RTRIDST_0_MARKETS-FEDFUNDS-JOBS-INSTANT.XML

CHICAGO, July 7 (Reuters) - U.S. short-term rate futures jumped after Friday's June payrolls report, slashing the implied chances of an August rate hike from the Federal Reserve after U.S. job creation was weaker than expected.

Chances for an August rate increase by the Fed shown by futures prices fell as low as 54 percent from 70 percent just before the data.

The Labor Department said 121,000 non-farm payroll jobs were created in June, far below Wall Street forecasts for 185,000 and recent whisper numbers.

[UpInArms]

34. Fed funds futures see Fed more likely to not hike rates

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B9E292A61%2D5156%2D4D28%2D96F3%2DA5DB5E77CAC0%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- The Federal Reserve is now more likely to not raise interest rates at its next policy setting meeting on August 8, according to the fed funds futures market, following weaker-than-expected June jobs data. The August fed funds futures contract was last up 0.02 points at 94.64, which implies an overnight rate of 5.36%, or a 44% chance that the Fed would raise its fed funds target to 5.50% from 5.25%. Late Thursday, the futures implied a 52% chance of a rate hike. The U.S. Labor Department said nonfarm payrolls expanded by 121,000 in June, lower than the 174,000 expected by economists surveyed by MarketWatch. The unemployment rate was steady at 4.6%, in line with expectations.

[UpInArms]

55. Printing Press Hums:Fed adds reserves through over-the-weekend system repo

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-07T133321Z_01_N07342884_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, July 7 (Reuters) - The Federal Reserve said on Friday that it added temporary reserves to the banking system through over-the-weekend system repurchase agreements.

Fed funds last traded at 5.25 percent, the Fed's target for the benchmark overnight lending rate.

For further details on the operation, see http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[UpInArms]

35. U.S. stock futures rally on hopes of rate pause

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B72B1E659%2DD8B9%2D430E%2D8357%2D8D12DA95DFF1%7D&symbol=

LONDON (MarketWatch) -- U.S. stock market futures rallied Friday as weaker-than-anticipated June jobs data renewed hopes that the Federal Reserve will stop raising interest rates.

Meanwhile, a greater-than-anticipated rise in hourly earnings and a revenue warning from Intel rival Advanced Micro Devices tempered enthusiasm.

S&P 500 futures rose 4.00 points at 1,286.80 and Nasdaq 100 futures were up 5.50 at 1,570.50. Dow industrial futures climbed 31 points to 11,320.

Nonfarm payrolls expanded by 121,000 in June, the Labor Department said, lower than the 174,000 expected by economists surveyed by MarketWatch. In the second quarter, payroll employment growth averaged 108,000, down from 176,000 in the first quarter. See Economic Report.

The weak data followed a report earlier in the week from payroll giant ADP predicted a gain of about 380,000.

<snip>

The dollar slumped on the weak jobs data, with the buck down 1.2% against the yen at 113.93 and the euro up 0.6% vs. the greenback to $1.2847. Bonds rallied, with the yield on the 10-year Treasury note ($TNX : 51.51, -0.34, -0.7% ) sliding 0.045 percentage points to 5.14%.

Crude oil futures rose 49 cents to $75.63 a barrel in electronic trading, which is a record high for a front-month contract. See Futures Movers.

...more...

[UpInArms]

36. Gold rises on weak payroll data, dollar falls

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B3A483934%2D5551%2D43B0%2DA6C4%2D84B8E59F9F82%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- Gold recovered from early Friday losses after weak payroll data triggered a plunge in the dollar. Gold for August delivery was last up 20 cents at $636.50 an ounce on the New York Mercantile Exchange. Other metals prices declined. Silver edged down 0.5 cents at $11.580 an ounce, platinum was down $2.60 at $1,247.0 an ounce and palladium dropped $1.85 at $329.0 an ounce. Copper was last down 3.70 cents at $3.580 a pound.

[UpInArms]

41. pre-opening blather (did somebody buy a clue?)

09:15 am : S&P futures vs fair value: -4.0. Nasdaq futures vs fair value: -13.2. The stage is now set for the cash market to start on a downbeat note as futures trade continues to deteriorate heading into the open. 3M Co. (MMM) recently issuing downside Q2 earnings guidance is more than offsetting an analyst upgrade on fellow Dow component GM while a same-store sales miss from Starbucks (SBUX) has the Nasdaq-100 component down 5% in pre-market trading.

09:00 am : S&P futures vs fair value: +1.1. Nasdaq futures vs fair value: -3.5. Futures indications are off their best levels, in large part after further analysis of the hourly earnings figure, and now suggest a mixed open for stocks. Given the Fed's increased inflation caution, the 0.5% jump in hourly earnings -- an inflationary factor that could influence the Fed -- equates to year-over-year growth of 3.9%, the biggest gain in five years. Also acting as a constraint to early enthusiasm is the fact that oil prices have hit a new all-time high above $75.50 per barrel and Advanced Micro Devices (AMD) warned last night that Q2 sales will be below expectations.

08:32 am : S&P futures vs fair value: +4.2. Nasdaq futures vs fair value: +5.8. Futures trade gets a boost following weaker than expected payrolls data, and now indicate a higher open for the indices. Non-farm payrolls rose a less than anticipated 121K (revised consensus 175K) while the May read was revised up to 92K from 75K; hourly earnings rose 0.5%, above economists' forecast of 0.3%, while the unemployment held steady at 4.6%. Bonds are also rallying on weaker than expected payrolls, as the 10-yr note is now up 8 ticks, knocking the yield down to 5.15%.

08:00 am : S&P futures vs fair value: -0.1. Nasdaq futures vs fair value: -1.5. Futures versus fair value reflects traders' wait-and-see attitude ahead of the much-anticipated June Employment report. It's due out at 8:30 ET and, not surprisingly, there is an air of nervousness ahead of it, especially due to such a large disparity between Wednesday's strong ADP payrolls data and a market looking to see if the recent weakness from May continued in June, thus easing the potential for stronger inflation and Fed rate hikes going forward.

[Roland99]

42. Inflation fancy fading away?

If the Fed is less likely to hike rates again, that seems to spark a buying frenzy but then maybe they're realizing, oh wait, jobs aren't being created to match growth, wages for workers are lagging inflation, energy prices are sapping disposable income, home equities are about tapped out, maybe profits won't be so grand in the future?

[UpInArms]

47. "economy may be slowing to a point where corporate earnings may suffer"

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BA0A0D3FA%2DCF1B%2D4F40%2DBC86%2DE5CEB991156D%7D&dist=newsfinder&symbol=&siteid=mktw

NEW YORK (MarketWatch) -- U.S. stocks opened lower Friday after 3M Co. warned of an earnings shortfall, and as the latest jobs data, while raising hopes the Federal Reserve may stop raising interest rates, also sparked concern the economy may be slowing to a point where corporate earnings may suffer. The Dow Jones Industrial Average ($INDU : 11,151.18, -74.12, -0.7% ) was down 16 points at 11,208. The Nasdaq Composite Index ($COMPQ : 2,140.98, -14.11, -0.7% ) fell 11 points to 2,144 while the S&P 500 Index ($SPX : 1,271.31, -2.77, -0.2% ) dropped 2.5 points to 1,271.

[Roland99]

50. Warning bell? Are we headed for some summer doldrums?

[UpInArms]

44. 9:31 EST bolting for the exits early

Dow 11,208.97 -16.33 (-0.15%)
Nasdaq 2,143.10 -11.99 (-0.56%)
S&P 500 1,271.86 -2.22 (-0.17%)
10-Yr Bond 5.161 -0.24 (-0.46%)

NYSE Volume 39,419,000
Nasdaq Volume 55,804,000

[UpInArms]

48. 9:40 EST bloody diarrhea all over the floor

Dow 11,151.18 -74.12 (-0.66%)
Nasdaq 2,141.58 -13.51 (-0.63%)
S&P 500 1,271.24 -2.84 (-0.22%)
10-Yr Bond 5.153 -0.32 (-0.62%)

NYSE Volume 121,492,000
Nasdaq Volume 129,721,000

blather on edit:

09:40 am : The market fails to hold onto brief pre-market gains, spurred by a lower than expected read on June payrolls, as stocks open lower across the board. Even though the market was initially relieved that the rumors of a June payroll surge did not materialize, as nonfarm payrolls rose only 121,000 -- a level of growth that is consistent with the "soft landing" the Fed is trying to achieve, a larger than expected 0.5% jump in hourly earnings that could create wage-inflationary pressures lends some rationale for another rate hike in August. Also, with earnings season officially beginning Monday, warnings from 3M Co. (MMM 75.70 -5.69) and Advanced Micro Devices (AMD 22.93 -0.90) question the likelihood of a 12th straight quarter of a double-digit operating earnings growth.DJ30 -70.76 NASDAQ -13.93 SP500 -2.82 NASDAQ Vol 124 mln NYSE Vol 70 mln

[Roland99]

49. 9:42am - Dang...it's a stampede!

DJIA 11,157.98 -67.32 -0.60%
Nasdaq 2,141.17 -13.92 -0.65%
S&P 500 1,271.65 -2.43 -0.19%
Dow Util 414.20 +0.36 +0.09%
NYSE 8,197.56 -0.28 -0.00%
AMEX 1,948.15 -8.78 -0.45%
Russell 2000 716.78 -3.86 -0.54%
Semcond 430.78 -1.12 -0.26%
Gold future 635.50 -0.80 -0.13%
30-Year Bond 5.18% -0.04 -0.84%
10-Year Bond 5.15% -0.04 -0.73%

[UpInArms]

53. 11:11 EST bloodletting continues

Dow 11,138.21 -87.09 (-0.78%)
Nasdaq 2,142.13 -12.96 (-0.60%)
S&P 500 1,271.28 -2.80 (-0.22%)
10-Yr Bond 5.138 -0.47 (-0.91%)

NYSE Volume 662,834,000
Nasdaq Volume 581,253,000

11:00 am : Recent recovery efforts are short-lived as oil prices briefly spiking lower stall some of the Energy's leadership, which will be closely watched heading into earnings season. Energy profits are expected to rise 25-30% and again account for the bulk of aggregate earnings growth on the SnP 500. Crude oil futures, which were as high as $75.78 per barrel earlier amid possible supply disruptions tied to Iran's nuclear ambitions and North Korea's missile tests, are now flat following a larger than expected build in natural gas inventories. DJ30 -83.24 NASDAQ -12.58 SP500 -2.49 NASDAQ Dec/Adv/Vol 1816/852/524 mln NYSE Dec/Adv/Vol 1583/1338/396 mln

10:30 am : Stocks regain some momentum within the last 30 minutes, but the indices continue to languish below the flat line. General Motors (GM 29.88 +0.68) spiking to session highs and now up 2.3% is among one of the more obvious catalysts behind the Dow paring its losses. Deutsche Bank upgraded GM to a Hold from Sell believing that a 3-way alliance with Nissan and Renault could have a significant strategic implication. Boeing (81.00 +0.19), Citigroup (C 49.32 +0.05) and Coca-Cola (KO 43.41 +0.08) recently turning positive have also offered some support for blue chips but are among only 12 Dow components in positive territory.DJ30 -59.78 NASDAQ -11.60 SP500 -1.14 NASDAQ Dec/Adv/Vol 1766/834/422 mln NYSE Dec/Adv/Vol 1413/1415/310 mln

[ozone_man]

56. Just a paper cut.

Hardly a flesh wound even. Not quite a full Fibinocci (0.618) retracement (11,299), but it'll have to do.

[wordpix2]

67. ouch! The numbers at 1:12 pm

Dow 11,122.04 -103.26

Nasdaq 2,146.52 -8.57

S&P 1,271.05 -3.03

10-Yr Note 99.97 +0.44

1:12 PM ET.

[stop the bleeding]

68. New lows for the day

triple digits - ouch is right

[Roland99]

71. And that's happened in the last 20 min. It was like -60/70 about 1pm

[stop the bleeding]

74. who knows, people came back from lunch and decided to

lock things in/sell before the weekend, the DJIA will probably work it's way back up to the 11130/5 number before the day's end, if it doesn't then we might go back down further to 11080 or somewheres in there, I seriously doubt today will end on a good note unless some sort of crazy news comes out.

[Roland99]

76. Still holding at about -108.

[stop the bleeding]

77. @ 2:45pm -141 @ that 11080 mark I was talkin' about n/t

[Roland99]

79. -148...going down in lurks and jerks.

[UpInArms]

54. Brookfield Homes stock falls after orders (down 49%) report

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B8CC04C7E%2D133A%2D4A1F%2D8998%2DDFBB2089FA08%7D&dist=newsfinder&symbol=&siteid=mktw

BOSTON (MarketWatch) -- Shares of Brookfield Homes Corp. (BHS : 30.65, -0.77, -2.5% ) fell 86 cents, or 2.7%, to $30.56 late Friday morning after the company said second-quarter orders were down 49% from the year-ago period. The home builder late Thursday said it estimates 1,200 to 1,300 home closings in 2006, down 18% to 24% from 2005. In a statement, the company noted particular weakness in its San Diego and Washington, D.C. markets, saying the decline in net new orders "results from an overall more competitive market environment as resale inventories increase and potential homebuyers take a wait and see approach."

[stop the bleeding]

57. ummmm - could someone shed some light on why the major indexes

all shot up within the last 15 minutes - since 11:30 sharp :eyes:

is this the start of an afternoon pump and dump?

[Roland99]

58. Triggers kicking in buys?

DJIA Seems to be languishing at -60 or so

[UpInArms]

59. PIEHOLE ALERT: Run for the Hills!

11:42 AM ET 7/7/06 BUSH SAYS HE WON'T NEGOTIATE ALONE WITH NORTH KOREA

11:33 AM ET 7/7/06 BUSH SAYS HE IS CONCERNED BY PROTECTIONIST TRENDS

[stop the bleeding]

62. I wonder what Oil is right now? n/t

[UpInArms]

64. Crude futures edge lower after touching a record level @ $74.80

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B945D62C6%2DF215%2D4EBD%2DA8CB%2D596710F857EB%7D&dist=newsfinder&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- August crude fell 34 cents to $74.80 a barrel after reaching a record intraday level of $75.55 for a front-month contract. Prices are "floating or balancing around unchanged up/down as traders adjust positions ahead of the weekend," said John Person, president of National Futures Advisory Service. The August contract was still on track to end higher for the week, after closing out last Friday at $73.90. August natural gas was down 17.9 cents at $5.49 per million British thermal units, trading at its lowest levels since July 2004.

[Roland99]

63. No negotiation w/ANYONE. He's askeered! He CUTS and RUNS from diplomacy!!

[wordpix2]

66. I like that: CUT and RUN from diplomacy!

[Roland99]

70. Need to use that everywhere and anywhere!

[UpInArms]

75. Bush rejects diplomacy: No one-on-one talks with North Korea

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B7B17E646%2D21BD%2D42A4%2DA861%2D812544EDC716%7D&symbol=

WASHINGTON (MarketWatch) -- President Bush on Friday ruled out any bilateral talks with North Korea and appealed for patience from the American people for the diplomatic process to solve the crisis.

Experts have said that one goal of North Korea's missile tests on July 4th may have been to force the United States to agree to bilateral negotiations.

But Bush said he would not be pressured into face-to-face talks with North Korea.

"One thing I am not going to let us do is get caught in the trap of sitting alone at the table with the North Koreans," Bush said at a press conference in Chicago.

Bush said China and South Korea must remain part of any talks with North Korea.
"In my judgment if you want to solve a problem diplomatically, you need partners to do so," Bush said.

...more...

[54anickel]

60. The economy's next time down has begun

http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/TheEconomysNextTimeDownHasBegun.aspx

snip>

Exhaustion: built into a bubble
The Federal Reserve precipitated, aided, abetted and cheered the largest (by dollar volume) stock mania in the history of the world. That mania exhausted itself in 2000. The exhaustion was not caused by the Fed tightening, contrary to what many folks believe, any more than the 1929 market break (and ensuing Great Depression) was caused by Fed tightening.

Manias end in exhaustion, though there are always coincident events surrounding the end of the move that get blamed for the decline. In both 2000 and 1929, higher interest rates were present, but they were not the cause. The preceding bubble was the cause of both the subsequent exhaustion and the ensuing bust.

Stock-splits out, split-levels
In an attempt to avoid the consequences of the late-1990s stock mania, the Fed managed (after 13 rate cuts and several tax cuts) to precipitate a bubble in housing. That bubble, in my opinion, is a far more dangerous problem than the stock mania was, because of all the leverage involved -- and the damage that will eventually inflict on the financial system, in addition to consumers whose overspending ways will be throttled back as the housing mania unwinds.

The next time down has been slow in developing, due to the fact that the housing bubble lasted longer than I would have expected (bubbles always last longer than anyone expects). And that is mostly due to the incredible abdication of responsibility on the part of all manner of lenders. That the public was gullible enough and willing to take on the debt is somewhat surprising (given that many people were burned by the preceding stock mania), but it wasn't shocking.

snip>

Overview of an aftermath
The next time down will be a time where people will be squeezed financially, because their main asset, i.e., their homes, will be declining in value. Meanwhile, their loan will be rising as a percentage of the value of that house and, in many cases, may ultimately pass 100%.

Jobs will be difficult to come by, as they have been for many, and that's a lingering residue of our prior stock mania and our general lack of competitiveness (productivity protestations to the contrary). It will indeed be a very ugly period, as the economy shrinks and people scramble to figure out how best to service their enormous debt loads. This will play havoc with the dollar, and I believe the "vaporization" of the dollar will be part-and-parcel of the next-time-down scenario.

more...

[ozone_man]

78. He's right.

All except for gold and the dollar. I think gold has quite a ways to go down before it goes up again. The same but in reverse for the dollar, as it will continue to rebound for some time. He's not thinking depression, yet he mentions many of the causative factors that lead to one.

[UpInArms]

72. 1:19 EST red numbers and rah-rah blather

Dow 11,110.20 -115.10 (-1.03%)
Nasdaq 2,143.02 -12.07 (-0.56%)
S&P 500 1,269.46 -4.62 (-0.36%)
10-Yr Bond 5.128 -0.57 (-1.10%)

NYSE Volume 1,160,228,000
Nasdaq Volume 1,012,421,000

1:00 pm : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges. Technology (-0.3%), though, continues to pare its losses, as evidenced in the tech-heavy Nasdaq inching ever so close to breakeven on the day. Since rising interest adversely impact the borrowing power of growth stocks, bond yields recently hitting session lows across the curve are helping to alleviate some of the nervousness about owning tech names. To wit, eBay (EBAY 27.24 +0.39), which hit a 3-yr low earlier has attracted bargain hunters and is now up 1.5%. DJ30 -64.75 NASDAQ -1.64 SP500 +0.75 NASDAQ Dec/Adv/Vol 1637/1207/954 mln NYSE Dec/Adv/Vol 1303/1821/734 mln

12:30 pm : Market improves its stance as the afternoon session gets underway but not nearly enough to make a significant change in the standings. With summer driving season in full swing and expectations that gas prices could surpass $3.00 a gallon nationally next week, oil prices slipping below $75 per barrel and to session lows may be offering some comfort heading into the weekend. DJ30 -60.68 NASDAQ -3.10 SP500 +1.04 NASDAQ Dec/Adv/Vol 1720/1100/848 mln NYSE Dec/Adv/Vol 1400/1693/660 mln

[fasttense]

73. Oh God, did bush speak today? The market is down. n/t

[Roland99]

80. 45min. to close and still hovering at or near daily lows.

[stop the bleeding]

81. oh oh oh - wait a minute - 20 miuntes till close and

the DJIA pops up 10++ points, man these people are hurting - something about those round numbers - see ya at 11100:eyes:

[Roland99]

82. 10 more pts...NASDAQ fighting to keep 2,130

[Roland99]

83. Closing numbers: Finished near the daily lows.

DJIA 11,090.67 -134.63 -1.20%
Nasdaq 2,130.06 -25.03 -1.16%
S&P 500 1,265.48 -8.60 -0.67%
Dow Util 416.65 +2.81 +0.68%
NYSE 8,155.05 -42.79 -0.52%
AMEX 1,944.44 -12.49 -0.64%
Russell 2000 709.30 -11.34 -1.57%
Semcond 430.78 -1.12 -0.26%
Gold future 634.80 -1.50 -0.24%
30-Year Bond 5.17% -0.05 -1.00%
10-Year Bond 5.13% -0.05 -1.02%

[stop the bleeding]

84. Where do you all get the blather(s) from?

I always find the summary(s) interesting especially with the FED, earnings season around the corner, and the price of Oil.

[Roland99]

86. I just post the numbers (from www.marketwatch.com)

A lot of the analysis/blather comes from there, too.

[UpInArms]

85. closing blather

The major averages closed sharply lower Friday as a mixed jobs report, downside guidance from two bellwethers and the absence of notable sector leadership kept buyers on the sidelines going into the weekend.

As if ADP Employer Services saying Wednesday that June nonfarm payrolls (according to their estimates) were very strong didn't create enough confusion about job growth, a mixed employment report from the Labor Dept. merely exacerbated uncertainty with regard to Fed policy. On the one hand, June nonfarm payrolls rising only 121,000 -- a level of growth consistent with the "soft landing" the Fed is trying to achieve, eased concerns of policy makers going too far with their tightening efforts. To wit, Treasuries took notice sending yields to session lows; the 10-yr yield closed at 5.12%. However, even though the market was initially relieved that the rumors of a June payroll surge did not materialize, a larger than expected 0.5% jump in hourly earnings -- an inflationary factor that could influence the Fed since it equates to year-over-year growth of 3.9%, the biggest gain in five years -- lent some rationale for another rate hike in August.

With earnings season officially beginning Monday and investors beginning to switch their focus to corporate profits, warnings from two industry bellwethers also weighed on sentiment, questioning the likelihood of a 12th straight quarter of a double-digit operating earnings growth for the SnP 500. The Industrials sector was hit the hardest after 3M Co. (MMM 74.10 -7.29) issued downside second-quarter earnings guidance due to lower than expected sales volumes for optical systems used in flat panel displays. Aside from Technology also falling victim to a warning after Advanced Micro Devices (AMD 23.56 -0.27) said second-quarter sales will be below expectations, 3M's warning also weighed on Corning (GLW 22.15 -1.09), the largest maker of glass for LCDs, preventing tech from surrendering its status as this year's worst performing sector.

Not even crude oil prices falling 1.4% from record highs was enough to get investors excited, even amid expectations that gas prices could surpass $3.00 a gallon nationally next week. While lower oil prices may bode well for consumers, especially with the summer driving season in full swing, a 1.3% decline in Energy questioned the sector's continued ability to support double-digit earnings growth for the broader market. BTK -0.58% DJ30 -134.63 DJTA -0.86% DJUA +0.68% DOT -0.88% NASDAQ -25.03 NQ100 -1.15% R2K -1.57% SOX -1.52% SP400 -0.93% SP500 -8.60 XOI -0.48% NASDAQ Dec/Adv/Vol 2181/852/1.79 bln NYSE Dec/Adv/Vol 2005/1246/1.43 bln

Have a great weekend all :hi: