This from Smart Profits Report:

Stating that the retail sector has suffered a bombardment of bad news the last few months is like saying the Atlantic Ocean is wet.

My colleague Paul Moore wrote an excellent piece on Tuesday, detailing Circuit City’s (NYSE:CC) problems. Let me first say that I agree with Paul on Circuit City and that its woes are company-specific and a result of poor management, rather than a sector wide problem.

While we may not see bankruptcies springing up everywhere, expect this holiday season to be a bloodbath for retailers.

Let’s look at what this year’s crucial shopping season has in store – and of course, the best ways to profit…

A Shift In American Shopping Philosophy

“Shop ‘Till You Drop.”

No sooner have many Americans digested their Thanksgiving turkey and got over the tryptophan-induced grogginess and bloating than they rush out to the mall, with this rallying cry ringing in their ears.

The most important factor in trying to forecast retail sales is income. And because we’re not a nation of savers, if Americans are making money, they’re usually spending it soon afterwards.

The problem right now, though, is this: Because the country has endured a widespread slump, Americans are starting to change the way they think. They’re fearful about their incomes.

Average consumers have already cut back on their spending, and will likely tighten their wallets even more as we head deeper into this overarching bear market. And with good reason, too…

The Stats Paint An Ugly Picture

• On Wednesday, Fidelity Investments started the process of laying off 1,300 workers.
• Chicago Mayor Richard Daley said Wednesday that CEOs who do business in Chicago have warned him that mass layoffs are coming this month and in December – with more on the way next year.
• According to the Bureau of Labor Statistics, over 235,000 people lost their jobs in 2,269 mass layoff events, which are described as layoffs involving at least 50 people in a single action.  This was the highest total since 2001.
• Job losses on Wall Street alone are expected to total at least 45,000.

On top of that, initial jobless claims are at the highest level in eight years and we’ve got an unemployment rate of 6.5% – a figure not seen since 1994.

Those figures alone spell trouble for the retail sector, but when people suggest those numbers could climb into the double-digits, well… you can imagine the misery that would ensue.

Simply put, people are just plain scared. Retail is enduring a double-whammy. On one hand, it’s suffering because people are already getting laid off and don’t have the income to buy flat-screen TV and iPods. And following swiftly behind it is the very significant issue that existing workers, mindful of the ugly trend, are worried that the next swing of the axe will hit them.

In other words, it’s bad right now and likely to get worse. One of the biggest casualties of the whole affair will doubtlessly be the retail sector, as it gets pounded like a veal scaloppini.

Your Christmas Stock Shopping List Should Include These Three Retailers

Since the market hit the skids, I’ve been a big advocate of compiling stock watchlists to keep on your radar. That way, when it’s time to pull the trigger, you’ll have all the resources and information right there at your fingertips. All you’ll need to do is take a deep breath and fire.

So, with that happier thought in mind, here are some retailers you might want to start thinking about:

~ Kohl’s (NYSE: KSS)

Kohl’s is in an excellent position to take advantage of the bankruptcies of competitors such as Mervyns. According to Toronto-based Thomas Weisel Partners, Kohl’s has picked up 20% of Mervyn’s market share in areas where Mervyns had to exit.

Since Mervyns plans on closing another 149 stores in California, that gives Kohl’s even more room to maneuver, which should provide a holiday boost.

~ Wal-Mart (NYSE: WMT)

There’s no doubt that Wal-Mart’s core demographic is feeling the pinch in this economy, with little leeway to buy new televisions and other extravagances.

However, while they can easily cast aside those extras, they still need necessities such as food and clothing – areas where Wal-Mart excels because of its lower prices.

And speaking of lower prices, you’re likely to see Wal-Mart attracting new customers these days, too. Gone are the good old days when you could just stroll into Coach and treat yourself to a new purse or briefcase. Luxuries like that are off the table for now, so Wal-Mart options are looking better and better to many people.

As CEO Lee Scott states: “Wal-Mart has momentum as we move into the fourth quarter. At a time when our customer is feeling the pressure of a tough economy, Wal-Mart’s price leadership is more important than ever.”

One caveat, though. Despite blowing third-quarter estimates away, with profits rising 10%, Wal-Mart has trimmed its fourth-quarter profit outlook, due to economic concerns.

~ Dollar Tree (Nasdaq:DLTR)

Not surprisingly, Dollar Tree shares are up significantly this year. In fact, the company boasts the best margins in the business right now. It chalked up double-digit earnings growth over the past two quarters and consumer traffic is increasing. The stock is trading at just 1.09 times its expected 14% growth rate. We don’t advocate shoplifting, but this is a steal.

… And A Happy New Year

The retail picture isn’t pretty. But it’s not completely ruined.

There will be a time when it will be right to get back in to stocks like Whole Foods (Nasdaq:WFMI) and Tiffany’s (NYSE:TIF). And that time will be before the economy is showing signs of recovery.

Why? Because we want to buy them cheaply when nobody else wants them. But we still have time before that occurs. In the meantime, concentrate your efforts on the companies like the ones I mentioned above – ones that should thrive and emerge stronger because of the hardship.

Source: Grandma Got Run Over By A Reindeer: How You Can Profit From The Retail Sector Bloodbath This Holiday Season

This from Smart Profits Report:

Here in the U.S., the mess continues unabated. The government had to reshape its bailout for AIG, including forking over an extra $40 billion. But despite the floundering company’s fourth consecutive negative quarterly report, the markets reacted positively to the story.

That didn’t help avert the crisis other areas, as Detroit’s automakers repeated their increasingly desperate pleas for some financial muscle and Circuit City (NYSE:CC) filing for Chapter 11 bankruptcy in order to seek protection from its creditors.

This came just a week after the electronics giant announced that it will close 155 of its 1500 stores. No wonder investors aren’t showing any confidence in the markets.

The fact that a mismanaged institution like Circuit City would declare bankruptcy wouldn’t be all that disconcerting at most times of the year. But when it’s right before Christmas…

However, this news might not be as bad as it seems. Smart investors know that Circuit City is an anomaly rather than a harbinger of the retail sector’s future…

Black Friday Or Red?

Black Friday – the traditional post-Thanksgiving excuse to shop until you drop – is only a couple of weeks away. Retailers like Circuit City, which depend on the holiday season for the bulk of its annual revenues, typically capitalize on the bargain-buying hordes in a number of ways. First, it opens the doors before the birds have started their early morning wake-up call and offers free prizes for the first few customers.

Even mismanaged companies can breathe a sigh of relief during holiday season, as they know exactly what to expect: Customers and cash.

But Christmas isn’t coming early for Circuit City. Not when Hewlett-Packard (NYSE: HPQ) and Samsung reduced or canceled its lines of credit at the very time when the retailer needed it the most. Sony (NYSE: SNE) even went as far as stopping delivery trucks in transit.

Why Circuit City Can’t Compete With The Big Boys

Take a look at the chart of the three-month LIBOR trend below. It indicates that the credit markets are beginning to loosen. The cost of inter-bank lending appears to have peaked on October 8 at just under 5.4% and has trended downward since.

As far as Circuit City is concerned, its pressing need for cash unfortunately happened to coincide with the credit crisis, and peaked shortly after LIBOR began to fall.

The threat of liabilities off the balance sheet has haunted both the company and its creditors for some time now. Circuit City is tied into multi-year leases that resulted in $116 million worth of termination cost liabilities as of August 31. And last week’s announcement of 155 store closures will probably account for $183 million more.

Even if the company were able to liquidate everything, the liability related to closing stores would be devastating, as the firm’s 1,500 locations are reduced. How many other companies can say they share those same sad stats?

In A Changing World, Circuit City Lacks Foresight

To top it all off, Circuit City showed a fatal inability to evolve with its industry.

Over the past few years, the Apple (Nasdaq:AAPL) database has emerged as the central point for music purchasing, edging out the previously popular CD. And folks who still like CDs usually rely on Wal-Mart (NYSE:WMT) and Internet retailers such as Tigerdirect and Buy.com, which offer lower prices compared to, say… Circuit City.

Cast the financial aspect aside for a second and chief competitor, Best Buy (NYSE:BBY) offers enviable customer service in its Geek Squad and personal shoppers. By contrast, Circuit City didn’t have the capital to capture the high-end of the market and, with pricing pressured at the low-end, the firm has quite simply languished until its cash reserves have disappeared.

Sure, the credit crisis didn’t help. But Circuit City can only blame it as a catalyst and not as a primary reason, since it’s been losing ground to Internet companies ever since iTunes made its debut.

Circuit City Had It Coming… But Its Main Rival Should Benefit

So at the risk of sounding blunt, Circuit City had this Chapter 11 coming. It’s simply a logical conclusion to six months of trouble, in which the company had to cut its dividend, lost an opportunity to be acquired due to lack of disclosure, and put plans for a new distribution facility on hold.

In this gloomy economic environment, most onlookers may see Circuit City as a prime example of what is going to happen to the rest of the retail sector, as we slide further into a recession. And with the critical holiday season around the corner, who can blame them?

A closer look, however, shows that while those fears are understandable, they’re not well-grounded. For some retailers like Best Buy, which will undoubtedly benefit from consumers not wanting to buy gift cards and extended warranties from Circuit City, this may actually be the end of the beginning rather than the beginning of the end.

Source: Circuit City Blows A Fuse… But Here’s Why Its Bankruptcy Doesn’t Spell Holiday Doom For Retailers

This begs the question, why would Circuit City want to emerge from bankruptcy? Best Buy is entrenched as the leader in the consumer electronics segment. Wal-Mart, which now carries name brand HD televisions at lower prices than Circuit City, is taking market share. Consumer spending on ‘luxuries’, such as big screen televisions has collapsed with the tightening credit markets.

How about the customer experience? When I recently went into a Circuit City store on a Saturday afternoon looking for an Ethernet cable, finding a sales associate was impossible. When I finally did locate one, they had no idea where to find the cable I needed. On top of that, I was one of perhaps a dozen customers in the entire store.

The cause of this poor experience is probably due to Circuit City laying-off approximately 3,400 sales associates last year and replacing them with lower paid workers. From my standpoint, and I am sure many others who have been to Circuit City lately, it is terrible shopping there. This doesn’t bode well going into the holiday season when retailers look for a boost in sales numbers.

I think perhaps it is time for Circuit City to call it a day and just cease operations. To re-emerge from bankruptcy in what is likely to be a continued economic slowdown and still facing eroding market share seems like a recipe for failure. There’s nothing wrong with knowing when to say when.

Source: Knowing When to Say When

“The decision to restructure the business through a Chapter 11 filing should provide us with the opportunity to strengthen our balance sheet, create a more efficient expense structure and ultimately position the company to compete more effectively,” James A. Marcum, vice chairman and acting president and chief executive officer, said yesterday (Monday) in a statement.

In the past year and a half, Circuit City has created nothing but a collection of ugly headlines. The Richmond, VA-based Circuit City has $3.4 billion in assets and $2.32 billion in liabilities, including a $119 million debt to Hewlett-Packard Co. (HPQ) and a $116 million debt to Samsung Electronics Co., Bloomberg reported.

Most recently, the fledging electronics retailer announced it would close 155, or 20%, of its 566 U.S. stores by Dec. 31 and slash its domestic workforce in an effort to conserve cash and reverse six consecutive quarters of falling sales.

The company has already slashed retail management positions, eliminated jobs at its corporate offices and laid off 3,400 retail workers.

On March 28, it was ousted from the Standard & Poor’s 500 Index.

The following month, Blockbuster Inc. (BBI) made an unsolicited $1 billion acquisition bid for Circuit City, offering at least $6 a share. The idea was to create a “supermedia” retailer that might be more competitive against such rivals as Best Buy Co. Inc. (BBY). But that offered fizzled.

In May, the company put itself on the auction block, a day after Best Buy announced plans to open stores in Europe via a $2.1 billion, 50-50 joint venture with London-based Carphone Warehouse Group PLC.

In June, Circuit City suspended its 4 cent dividend. And in September, President and CEO President Philip Schoonover resigned on the spot.

Circuit City has lost more than $5 billion in stock-market value in the past two years, Bloomberg reported.

Circuit City Files for Bankruptcy After a Year of Falling Sales and Corporate Cutbacks

In the company’s Monday release, Circuit City said it is closing stores in 55 metro areas and will exit 12 markets entirely. It also said it is reducing future store openings, “aggressively” renegotiating current leases and considering “all available options and alternatives to restructure its business.”

The release also throws a lot of blame, citing “waning consumer confidence,” a “significantly weakened retail environment” and “unfavorable macroeconomic conditions.”

Circuit City also said it is waiting for nearly $80 million tax rebate it believes the federal government owes the company.

That figure is nearly twice its shrunken market cap.

“Since late September, unprecedented events have occurred in the financial and consumer markets causing macroeconomic trends to worsen sharply. The weakened environment has resulted in a slowdown of consumer spending, further impacting our business as well as the business of our vendors,” James A. Marcum, vice chairman and acting president and chief executive officer, said in the release.

“The combination of these trends has strained severely our working capital and liquidity, and so we are making a number of difficult, but necessary, decisions to address the company’s financial situation as quickly as possible.”

Missing from his statement is the fact that the electronics industry has widened over the past decade – growing popularity of DVDs, video games, HDTVs computers and laptops, cell phones – spawning new competitors such as GameStop Corp. (GME) and Apple Inc’s (AAPL) iTunes in addition to its chief rivals Wal-Mart Stores, Inc. (WMT), Target Corp. (TGT) and Best Buy Co., Inc. (BBY).

And those other companies are doing a much better job pushing the same merchandise off their shelves than Circuit City.

Uphill Battle

To gauge how steep an uphill battle Circuit City has, it helps to look back key moments in its decline.
Over the past year and a half, the company has slashed retail management positions, eliminated jobs at its corporate offices and laid-off 3,400 retail workers.

On March 28, it was ousted from the Standard & Poor’s 500 Index.

The following month, Blockbuster Inc. (BBI) – another fading national company – made an unsolicited $1 billion acquisition bid for Circuit City for at least $6 a share. The idea was to create a supermedia retailer that might be more competitive.

That offered fizzled.

In May, the company put itself on the auction block, a day after Best Buy announced plans to open stores in Europe through a $2.1 billion 50-50 joint venture with London-based Carphone Warehouse Group PLC.

In June, it suspended its 4-cent dividend. And in September, CEO and President Philip Schoonover resigned on the spot.

All that carnage has caused Circuit City’s stock tofall 99% in the past year and a half – from about $30 a share to its current price of 36 cents a share.

Source: Battered Circuit City Closing 155 Stores, Scraping for Capital

This from Today’s Financial News:

Just a few days ago, I wrote about how the housing slowdown has reached its lowest point. I told readers that some real-estate investment trusts (REITs) look downright promising. I also warned that others were in extremely dangerous territories.

Yesterday’s consumer spending figures proved my theory was right on track. The report showed that while consumer spending dropped 1.2%, healthcare spending was up by a similar amount.

In other words, REITs that specialize in healthcare properties, like National Health Investors (NYSE:NHI), will beat the markets. And their counterparts that focus on retail-related properties, like Simon Property Group (NYSE:SPG), are going to under-perform.

Going out of business sale

Mall owners saw their share prices get slashed yesterday. As a whole, retail-based REITs dropped over 14%, while the rest of the markets dropped by just 8%. Stocks with those kinds correlations to consumer spending are not the kind of stocks you want to be investing in during a recession.

The pain is only going to get worse for REITs like Simon Property. Right now, out of the more than 380 malls the company owns, 91.8% of them are occupied. This time last year, that figure was only slightly higher, reading at 92% occupancy. Only a few less stores are rented now than last year.

Those two figures should scream to potential investors that the worse is yet to come. Because store closures significantly lag behind dwindling retail stores, we are going to see occupancy rates drop for several more quarters, if not years, to come.

Going belly-up

Companies like Circuit City (NYSE:CC) and Linens ‘n’ Things are in serious trouble. The electronics retailer is within grasp of bankruptcy. And the home furnishings chain is closing its door for good, with some stores shutting down as soon as tomorrow.

It is the same picture all over the industry. Mall occupancy rates will soon start to plummet.

Needless to say, the retail REIT sector is in serious trouble. As a value investor, it may be tempting to grab these stocks at current prices (they have fallen more than 40%) thinking they have reached their bottom. Do not do it. It is a trap.

The retail industry’s woes have just begun. The problems will get much worse before they even think of getting better.

If you are looking to play the real estate industry and take advantage of its sizeable dividends, look at the healthcare industry and its lucrative REITs. There are only two sectors of consumer spending that are actually expanding. Take advantage of them.

Source: Retail figures slump: Simon Property Group (SPG) feels the pain

• Circuit City Stores Inc. (CC) announced yesterday (Monday) that Chairman, Chief Executive and President Philip Schoonover would resign from all posts, effective immediately. Schoonover was the subject of increasing criticism as Circuit City posted slipping financial results over the past year. Vice Chairman James Marcum will serve as acting Chairman and CEO, Reuters reported.

• Microsoft Corp. (MSFT) yesterday (Monday) announced a $40 billion share repurchase program. The buyback plan – the largest ever on record – is slated to run through September 2013, MarketWatch reported. Microsoft gained 24 cents on the news to close at $25.40 on an otherwise down market day.

• McAfee Inc. (MFE) agreed to buy Secure Computing Corp. (SCUR) in a deal valued at $465 million. The second-largest maker of security software plans to expand its product line for protecting corporate networks and e-mail systems, Bloomberg News reported. The price of $5.75 per common share is a 27% premium over Secure Computing’s closing price on Friday.

• Electricite de France SA (PINK: ECIFF) yesterday (Monday) announced that it had offered to purchase Constellation Energy Group Inc. (CEG) for $6.2 billion, a 32% premium over Warren Buffett’s offer. The offer, made in conjunction with private equity firms KKR & Co. (KKR) and TPG Capital LP, was not accepted due to Buffett’s MidAmerican Energy Holdings Co.’s promise of an immediate $1 billion cash infusion. “The offer accepted provided immediate liquidity and a strategic transaction that we think is executable,” Constellation Chief Executive Officer Mayo Shattuck said on the call. “That, amongst other variables considered, represents a superior offer.”

• Moody’s Investors Service (MCO) yesterday (Monday) downgraded the financial strength rating of Washington Mutual Inc.’s (WM) main bank subsidiary to “E,” its lowest rating, saying the bank’s capital is insufficient to absorb its mortgage losses, The Associated Press reported. Moody’s also cut its rating on WaMu’s preferred stock further into junk status to “Ca” from “B2.”

• CarMax Inc. (KMX) said yesterday (Monday) that second-quarter earnings fell 78%, as a weak economy, high gas prices, and losses the company’s financing arm proved too much to overcome. Earnings for the quarter ended Aug. 31 fell to $14 million, or 6 cents per share, from $65 million, or 29 cents per share, last year. Total sales fell 13% to $1.84 billion from $2.12 billion a year ago.

• Sallie Krawcheck, head of Citigroup Inc’s (C) wealth management unit, will step down from the company, The Wall Street Journal said yesterday (Monday). According to the report, Citigroup will move the wealth management unit under the umbrella of its institutional clients group.

• Legg Mason Inc. (LM) yesterday (Monday) denied a report by The New York Post that it plans to go private to escape tumultuous markets and a deepening credit crisis. “While we don’t normally comment on market rumors, in this uncertain time we want to be clear that The New York Post story is not true and Legg Mason’s strategy has not changed,” Legg Mason spokeswoman Mary Athridge said in a statement.

Source: Global Investing Roundups Tuesday, September 23rd, 2008

Now there’s a new outfit in town, says Penny Sleuth UK editor Tom Bulford. It’s called Nerd Force. And Tom reckons it’s a good buy.

Nerd Force is owned by by Nexus Management (LON:NXS), a small UK company whose shares trade on AIM at a price of just 0.8p. It also have twenty years of IT experience. If NXS can handle the roll-out successfully, its shares can only rise.

All who have a computer need some help from time to time, and for those of us who rely upon it for our livelihood a swift and reliable service is absolutely crucial.

994 in Minnesota, Geek Squad is now owned by US electronic goods retailer BestBuy (NYSE:BBY). Another American national retailer, Circuit City (NYSE:CC), has its own service arm, Firedog.

Now a new name is to be rolled out across the USA. It is called Nerd Force, and it is owned by Nexus Management (LON:NXS), a small UK company whose shares trade on AIM at a price of just 0.8p.

Nerd Force was born in 2003 in Staten Island and now has a fleet of yellow vans out of which leap willing technology specialists ready to fix PCs. Nerd Force is now looking to franchise the business across the USA and overseas, and it starts with certain advantages.

The first of these is that neither Geek Squad nor Firedog are franchise operations, but are instead closely tied to the retail operations of Best Buy and Circuit City.

Geek Squad no longer fix computers on site but instead send them to a factory somewhere in America, from which they take a fortnight to return. As Roger Richardson, the CEO of Nexus, observes, ‘not many small business people could operate without their computer for two weeks.

The second advantage that Nerd Force will have relates to the history of Nexus, and to a deal that it struck with another US retailer of electronic goods, the Los Angeles based PD Financial.

Nexus has been around for almost twenty years, starting out as supplier of e-mail solutions for small and medium sized businesses throughout Europe. Since then it has added a number of other services, such as remote server management, disaster recovery, data storage, a help-desk, desktop support and wide area network management and monitoring.

With a data centre in Maine, USA, and another office in Dornock, Scotland, it can offer its services worldwide complete with round the clock telephone back-up. Traditionally Nexus has targeted small businesses, especially those operating in more than one country, but in 2006 it bought a 24% stake in PD Financial.

It’s got access to a good list

Trading as Peach Direct, PD sells electronic goods and other such luxury items as jewelry and golf clubs. It has no stores, but sells only through mail shots and its on-line channel, offering finance packages to those with a carefully vetted credit status.

The attraction for Nexus was the forty thousand or so PCs sold annually by PD. In the first year of the partnership customers for twelve thousand of these also decided to buy support from Nexus.

These were valuable extra customers for Nexus, but they were also typically private buyers who need help with the PC at weekends, in contrast to the traditional business customers who call the Nexus help desk in the week.

In February of this year Nexus sold 72% of its stake back to PD’s owners for $5m, netting a profit of £1.15m on the deal. However, the two have maintained their business relationship and it is with the encouragement of PD that Nexus have decided to buy Nerd Force.

What PD has found is that many of its customers, not only for PCs but also for items like flat screen TVs, would willingly pay extra for somebody to come and install them. So PD would like to have a relationship with Nerd Force, while Richardson sees the chance to combine the on-site service of Nerd Force with its existing remote back-up service and offer an attractive, comprehensive and good value proposition to small business and private customers.

Although the immediate plan is to franchise Nerd Force across the USA, there have already been enquiries from potential franchisees in India, Brazil and Europe and Richardson believes that Nerd Force could become a dominant force in the fragmented market of franchised IT support.

In spite of this appealing strategy the share price of Nexus has been weak of late, no doubt reflecting the retailing climate in the United States, as well as a renegotiation of payment for the sale of the stake in PD, involving a delay of two months in the payment of $2m, now due by the end of August.

Nexus has said that ‘in the event that PD is unable to pay …a charge of $100,000 per month will be levied’ – stiff terms between two business partners. The City is clearly looking for this to be resolved and for evidence that PD is countering the tough economic environment in the United States.

Beyond that there is the roll out of Nerd Force to consider. With established names already in the market place this is an ambitious plan. But with Nexus valued at just £7m the share price of Nexus is not taking a lot on trust. This is definitely one to watch.

Source: Peaches and Nerds

• Crude futures closed yesterday (Wednesday) at a record $143.57 a barrel in New York after the U.S. Department of Energy announced a 2 million barrel decline in supply last week. Earlier, crude had traded for as high as $143.91 on Globex, MarketWatch reported.

• Shares of General Motors Corp. (GM) plunged Wednesday to their lowest level in 54 years yesterday (Wednesday), as investors shrugged off better-than-expected June sales and analysts raised concerns about the company’s cash needs, The Associated Press reported. In afternoon trading, GM shares fell as low as $9.98, their lowest level since hitting $10.36 a share on Sept. 21, 1954.

• Starbucks Corp. (SBUX) has announced plans to close 600 underperforming U.S. stores and cut up to 12,000 full- and part-time positions, Reuters reported. The company is bracing for its first full-year profit decline since 2000, as it struggles with a deterioration in consumer spending and increased competition.

• The Nikkei 225 average fell 1.3% yesterday (Wednesday) to hit its longest losing streak in more than 40 years, Reuters reported. The benchmark Nikkei logged its 10th straight negative day, a period in which it has slid about 8%, its longest losing streak since February-March 1965.

• UnitedHealth Group Inc. (UNH) will cut at least 4,000 jobs, or 5% of its workforce, in a restructuring effort and has warned that higher costs will cut into profits this year, The Associated Press reported. Chief Executive Stephen J. Hemsley said the company is shifting management positions to better focus on regional coverage.

• American Airlines Inc., the air carrier subsidiary of AMR Corp. (AMR), yesterday (Wednesday) warned 900 flight attendants with the least seniority that they are subject to furlough Aug. 31. The airline said the notice was not a layoff notice, but that the written warning was a required step in the initial layoff process, DowJones reported.

• Circuit City Stores Inc. (CC) shares plunged 9% yesterday (Wednesday) after Blockbuster Inc. (BBI) announced it would no longer be pursuing its takeover offer after a round of due diligence with Circuit City’s books, MarketWatch reported. Shares closed at $2.32 a share yesterday; well under Blockbuster’s initial $6 – $8 per share bid.

• The Wall Street Journal yesterday (Wednesday) reported that Microsoft Corp. (MSFT) was seeking additional media partners for a bid for Yahoo! Inc.’s (YHOO) search engine business. Citing sources close to the talks, the Journal said discussions with Time Warner Inc. (TWX) and News Corp. (NWS), among others, were in early stages and unlikely to result in a deal with Yahoo, Reuters reported.

Source: Global Investing Roundups Thursday, July 3rd, 2008

NEW HIGHS OF NOTE LAST WEEK

Halliburton (HAL)… oil services
Patterson-UTI (PTEN)… oil services
Carbo Ceramics (CRR)… oil services
Atwood Oceanics (ATW)… oil services
Key Energy Services (KEG)… oil services
National Oilwell Varco (NOV)… oil services
Spectra Energy (SE)… gas pipelines
U.S. Steel (X)… you guessed it
Schnitzer Steel (SCHN)… scrap steel
Fluor (FLR)… infrastructure
Quanta Services (PWR)… infrastructure
Crude oil, Natural gas, Gasoline, Corn, Soybeans, Cocoa

NEW LOWS OF NOTE LAST WEEK

JetBlue (JBLU)… airline
US Airways (LCC)… airline
Continental Airline (CAL)… airline
MGM Mirage (MGM)… casinos
Boyd Gaming (BYD)… casinos
Wynn Resorts (WYNN)… casinos
Las Vegas Sands (LVS)… casinos
Monarch Casinos (MCRI)… casinos
Winnebago (WGO)… RVs
Thor Industries (THO)… RVs
Fleetwood Enterprises (FLE)… RVs
Goodyear Tire (GT)… tires
News Corp (NWS)… media
Hershey (HSY)… candy
Playboy (PLA)… eye candy
American Express (AXP)… credit cards
Capital One Financial (COF)… credit cards
International Gaming (IGT)… gambling machines
Circuit City (CC)… landfill stuffing continues to suffer
Veolia Environnement (VE)… world’s largest water stock
Honeywell (HON)… conglomerate
General Electric (GE)… conglomerate
United Technologies (UTX)… conglomerate
XM Satellite Radio (XMSR)… satellite radio
Legg Mason (LM)… asset management
Callaway Golf (ELY)… golf equipment
Whole Foods (WFMI)… expensive groceries
General Motors (GM)… read the letter from the Chairman
Lead, Nickel

Source: Brian Hunt’s Market Notes Monday, June 30, 2008