• Both the Dow Jones Industrial Average and the Nasdaq Composite Index flirted with 9,200 and 2,000 yesterday (Thursday), respectively. Thanks to a continuing string of better-than-expected earnings reports, the Dow jumped 83.74 points, or  0.92% to close at 9,154.46. The tech-heavy Nasdaq eclipsed 2,000 in trading before finally settling in at 1,984.30, up 16.54, or 0.84%, its highest close since October 1. Meanwhile, the Standard & Poor’s 500 also posted a gain, closing at 986.75, up 11.6 or 1.19%. “Institutional and retail investors are so anxious to make up the lost returns of the last year, they are using any cue to buy aggressively,” Kevin Mahn, managing director and chief investment officer at Hennion & Walsh told MarketWatch.com. “We got to the point in the first quarter, when everyone was so risk averse they lost out. And, in just six months, they have now become overly aggressive.”

• U.S. taxpayers yesterday (Thursday) became Citigoup Inc.’s(NYSE: C) largest shareholder with a 34% stake in the company. The federal government swapped $25 billion of its $45 billion Troubled Asset Relief Program (TARP) investment into common stock. The remaining $20 billion will remain in the form of preferred shares that pay an 8% annual dividend.

• Initial claims for jobless benefits rose by 25,000 to a seasonally adjusted 584,000 last week the Labor Department said yesterday (Thursday). However, the number of people still on benefit rolls after collecting an initial week of aid fell by 54,000 to 6.20 million in the week to July 18, the lowest since early April. That fueled optimism that the economy is on the mend.

• Light, sweet crude for September delivery yesterday (Thursday) rose $3.59, or 5.6%to settle at $66.94 a barrel on the New York Mercantile Exchange (NYMEX). The surge left some analysts miffed, as there was no obvious motivation. “You need to really worry about a market that sells off on a very large build and supply one day, and then it rebounds on no headline at all,” analyst and trader Stephen Schork told The Associated Press.

• Motorola Inc. (NYSE: MOT) yesterday (Thursday) posted an unexpected profit for the second quarter after several quarters of losses. Motorola said cost cuts including 8,000 layoffs so far this year were largely responsible for the turnaround. Revenue dropped 32% to $5.5 billion for the quarter, but the company reported a profit of $26 million, or 1 cent a share. That’s up from $4 million a year ago.

• The worst recession in more than 60 years is taking its toll on theWalt Disney Co.’s (NYSE: DIS) advertising and theme park revenue. The Burbank, Calif.-based company saw its net income drop to $954 million, or 51 cents a share for the quarter ended June 27. That compares to a net income of $1.28 billion, or 66 cents a share in the same quarter last year. Operating income from its highly seasonal theme parks dropped 19% to $521 million in the quarter, compared to last year’s $641 million, which was up 3% from 2007. Advertising on its media networks which include ESPN decreased: The operating revenue was down 13% to $1.3 billion, compared to last year’s 9% increase to $1.5 billion.

• Microsoft Corp. (Nasdaq: MSFT) Chief Executive Officer Steve Ballmer weighed in on the beating his company’s new partnerYahoo Inc. (Nasdaq: YHOO) took Wednesday, when investors unloaded shares to send Yahoo’s stock down more than 12%. “People haven’t figured it out,” Ballmer said. “Yahoo gets 88% of the search revenue they have today. They have 0% cost of goods sold against 88% revenue and they have no [research and development] expense and no ongoing [capital expenditure],” Ballmer said in a Dow Jones Newswires report, which cited an event at Microsoft’s headquarters in Redmond, Wash. Yahoo’s Wall Street beating continued yesterday (Thursday), with its shares closing at $14.60, down 54 cents or 3.57%. Microsoft’s shares climbed 1 cent yesterday, closing at $23.81, up .04%.

• Southwest Airlines Co. (NYSE: LUV) made a minimum bid of $113.6 million for Frontier Airlines Holdings Inc. (OTC: FRNTQ) in a bankruptcy auction that would eliminate its low-fare rival. The bid would compete with a pending offer of $108.8 million fromRepublic Airways Holdings Inc. (Nasdaq: RJET). The winning bidder will get a bigger foothold in the Rocky Mountain region. “Taking the Denver gates and equipment from Frontier would give them a large presence there, and the cities that aren’t on Southwest’s route map now could easily be integrated,” said Dave Swierenga, president of an aviation consulting firm AeroEcon toldBloomberg News.

Source: Investment News Briefs Friday, July 31, 2009

• The Reserve Bank of India reduced its repurchase rate from an already low of 5.5% to 5.0%, its fifth cut since October. “We see a significant slowdown in investment,” Sailesh Jha, a senior regional economist at Barclays Capital Plc in Singapore, told Bloomberg. “There is scope for more significant rate cuts.”

• ADP Employer Services said that U.S. private employers cut 697,000 jobs in February, an acceleration of the revised 614,000 jobs lost in January. The figures mark the biggest job loss since the report’s launch in 2001, Reuters reported.

• U.S. auto sales sunk 41% in February, as nearly every vehicle model by the country’s six-largest automakers posted at least a 10% drop in year-over-year sales. “It implies we have not reached the bottom, and pushes that bottom out to some point yet to be determined,” Emily Kolinski Morris, senior U.S. economist for Ford Motor Co. (F), told CNNMoney.com.

• For the first time since December 1991, shares of General Electric Co. (GE) fell below the $6 mark. “The market is beginning to anticipate a downgrade to double-A territory,” Pacific Investment Management Co.’s Bill Gross said in an interview on CNBC. “We believe even with the downgrade, it’s a viable, safe, liquid credit going forward.”

• Oil prices jumped more than 9% yesterday (Wednesday) after plans for further stimulus in China stirred the markets from their slumber and U.S. inventories declined more than expected. Light, sweet crude for April delivery rose $3.73 a barrel to settle at $45.38 on the New York Mercantile Exchange, its highest close in six weeks.

• Merrill Lynch & Co’s (MER) 10 highest-paid employees got a total of $209 million in cash and stock in 2008, up from $201 million in 2007, the Wall Street Journal reported. Merrill’s net loss ballooned to $27.6 billion last year

Source: Global Investment News Briefs Thursday, March 5, 2009

• JPMorgan Chase & Co. (JPM) will eliminate 2,800 jobs at Washington Mutual through attrition, Bloomberg reported. In December, the company slashed 9,200 jobs at WaMu, which it bought for $1.9 billion last year.

• General Motors Corp. (GM) posted a loss of almost $31 billion in the fourth quarter, and said its auditors will likely doubt its viability. The company burned through $5 billion during the quarter, and warned that its pension plans were underfunded by $12.4 billion, Reuters reported.

• Hong Kong’s January exports sunk 21.8% from a year earlier, the biggest decline in 50 years. “It’s not just Hong Kong, the financial crisis is dragging down the whole of Asia,” Wang Qian, an economist at JPMorgan Chase & Co. in Hong Kong, told Bloomberg. “The trade environment is going to get worse.”

• Tech giant IBM (IBM) retained its full-year earnings outlook, saying that service contracts are grew in January. “Recognizing that it is still early in the quarter, the company expects double-digit growth in long term signings, and growth in total signings in first quarter 2009,” IBM said in a regulatory filing, Reuters reported.

• The number of Americans filing initial claims for unemployment insurance spiked the week ended Feb. 21, as 667,000 Americans filed initial jobless claims, up 36,000 from a revised 631,000 the previous week, the Labor Department reported.

• Oil prices jumped for a second straight day yesterday (Thursday) with light, sweet crude for April delivery jumping $2.72, or 6.4%, to settle at $45.22 a barrel on the New York Mercantile Exchange.

Global Investment News Briefs Friday, February 27, 2009

Oil held around $40 a barrel on Thursday after U.S. crude stocks swelled to an 18-month high and investors anticipated more bleak economic data out of the world’s biggest fuel consumer.

The outlook for more huge job losses in the United States darkened the demand prospects there.

A global financial slowdown has cut demand and swollen fuel stocks, knocking more than $100 a barrel off the price of crude since its July 2008 peak of $147.

U.S. crude inventories jumped by 7.2 million barrels to an 18-month high last week, data from the U.S. Energy Information Administration showed, twice what analysts expected and the sixth straight weekly rise.

U.S. light crude for March delivery ticked up 2 cents to $40.34 a barrel at 1019 GMT, about $4 below London Brent crude for the same month, which gained 30 cents to trade at $44.45 a barrel.

U.S. crude has been locked between $39 and $49 a barrel for the past two weeks.

“Crude oil markets still seem to be trapped within a trading range, as market anticipation about OPEC cuts — both current and pending — is keeping something of a floor below prices,” MF Global said in a report.

“…The upside is capped by lingering concerns over the macro situation.”

Oil losses have been limited by signals this week from the Organization of the Petroleum Exporting Countries that it may cut oil production further in an attempt to bolster the market.

OPEC, worried that the global economic downturn is reducing oil demand and pressuring prices, has promised to reduce oil production by a total of 4.2 million barrels per day (bpd) from levels seen in September.

LONDON, Feb 5 (Reuters)

Oil prices fell towards $45 a barrel on Tuesday as the market began to anticipate data showing rising fuel inventories that reflect economic slowdown.

Prices had earlier advanced more than a dollar, boosted partly by cold weather in top energy consumer the United States, plus signs OPEC oil supply cuts may have begun to bite.

U.S. light, sweet crude for March delivery fell 66 cents to $45.07 a barrel by 1259 GMT. It earlier touched a session high of $47.49 a barrel and a session low of $44.40.

U.S. crude has rebounded from below $33 a barrel in the past week.

London Brent crude fell 92 cents to $46.04 a barrel.

“The retreat toward the lower end of the trading range is suggests the market is anticipating stock builds in the API figures,” said Christopher Bellew of broker Bache Commodities Ltd.

The American Petroleum Institute (API), an industry body, has moved publication of its weekly inventory report to 2130 GMT on Tuesdays from Wednesdays, a day earlier than official government inventory data released on Wednesday.

The government data is forecast to show that U.S. crude oil stocks rose a further 2.7 million barrels last week, the fifth straight week of gains.

Colder weather is expected to help draw down distillate stocks by 800,000 barrels, according to a Reuters poll. Gasoline stocks are likely to have risen by 1.3 million barrels.

ABOVE LOWS

The U.S. cold snap has helped prices move up from lows earlier in January of $32.7 a barrel, but analysts say the recovery may be temporary.

“Unless OPEC production cuts in January were substantially greater than what we have assumed, it is still too early to be calling an end to this current bear market,” Goldman Sachs said in a research note.

Oil’s supply/demand picture remains weak, Goldman said, pointing to a large counter-seasonal stock build in the United States and extremely weak demand in China, the world’s second largest energy consumer.

Oil has dropped more than $100 from a record peak above $147 a barrel in July last year, depressed by falls in demand as the credit crisis has pushed the global economy towards recession.

Goldman said retail investors were moving into oil, attracted by its low price, so that speculative positions or “length” in the oil market is now larger at $45 a barrel than it was at $147.

The Organization of the Petroleum Exporting Countries has agreed to reduce supply by 4.2 million barrels per day since September to try to support prices. The producer group is due to meet next in March.

A cyclone off western Australia has shut down nearly half of the country’s oil output, but some operators said production was likely to resume by Wednesday as the storm weakens.

Later on Tuesday, U.S. President Barack Obama goes to Capitol Hill to campaign for an $825 billion economic stimulus package to be put to a House vote within days.

LONDON, Jan 27 (Reuters)

• Sources close to the matter told Bloomberg News that President-elect Barack Obama may name Steven Rattner as “car czar,” a top-level position that would oversee the conditions of which bailout money is given to U.S. auto companies, Bloomberg reported. Rattner co-founded private-equity firm Quadrangle Group LLC in 2000.

• Barclays plc is planning to cut more than 2,100 jobs from its investment banking and investment management units, sources told Reuters. About 1,300 jobs would be lost from Barclays Capital. About 500 from Barclays Wealth. And about 370 from Barclays Global Investors.

• Great Britain energy titan, BG Group plc, plans to invest between $4 billion and $5 billion to develop oil fields in Brazil through 2012. “We’re confident that these developments can be made economic at lower oil prices, but we’ll need to ensure the efficiency of the investment. Oil prices we see today are much more realistic,” Chief Executive Officer Frank Chapman told Bloomberg.

• Pharmaceutical giant Pfizer Inc. (PFE) said it plans to slash 800 research jobs, a reduction of 5% to 8% of its research workforce. Most of the cuts will come from labs in California, Connecticut and England, and are in addition to the near 10,000 jobs cut companywide since early 2007, Reuters reported.

• Crude futures halted a weeklong price slide yesterday (Tuesday), as light, sweet crude for February delivery rose 19 cents to settle at $37.78 a barrel on the New York Mercantile Exchange. Futures briefly touched $36.10 a barrel, a new low for the year, earlier in the day.

• Commercial banks borrowed more while investment banks borrowed less from the U.S. Federal Reserve’s emergency lending program over the most recent week. The Fed report said commercial banks averaged daily borrowing of $87.9 billion during the week that ended last Wednesday. That was an increase from the $86.6 billion in average daily borrowing for the week that ended Dec. 31. Investment firms borrowed nearly $36 billion over the past week, USA Today reported. That was down from the average of $38.5 billion for the week that ended Dec. 31, the newspaper reported.

• U.S. companies may have to contribute $109 billion to their corporate pension plans this year to fill funding gaps caused by turmoil in the financial markets, consulting firm Watson Wyatt Worldwide Inc. (WW) said yesterday (Tuesday). Watson Wyatt expects companies also will have to contribute more than $102 billion in 2010. Both of these figures are up significantly from the $38 billion that companies were required to contribute to the plans last year.

Source: Global Investment News Roundup Wednesday, January 14th, 2009

Oil prices rose above $40 a barrel on Monday, boosted by the weak dollar and Israeli attacks on Hamas that served as a reminder of tensions that could threaten Middle East crude oil supplies.

U.S. light, sweet crude was up $2.75 at $40.45 a barrel by 1335 GMT, below a session high of $42.20.

Oil is on track for a nearly 60 percent loss this year, the biggest annual fall since futures began trading 25 years ago.

London Brent crude rose $2.88 to $41.25 a barrel, after touching a session high of $43.18.

“Geopolitics had disappeared from the oil scene for the last couple of months but will regain some price premium with the latest Israeli attack in Gaza,” Olivier Jakob, of consultants Petromatrix, said in a research note.

Israeli aircraft attacked Hamas targets in Gaza on the third day of an offensive that has killed more than 300 Palestinians, many of them civilians.

The attacks enraged Arabs across the Middle East and highlighted the risk, however remote, that the conflict could threaten oil supplies from the region.

Gold rose nearly 3 percent to its highest since early October on the weak dollar and the Middle East violence.

The dollar fell broadly, pressured by the gloomy outlook for the U.S. economy.

“The level and intensity of violence this time has warranted a fiercer response from the broader Arab world and beyond,” said Raja Kiwan of energy consultants PFC Energy.

Kiwan said, however, that the amount of bearish economic news would ultimately overshadow such geopolitical factors.

OPEC COMPLIANCE

Oil is down more than $100 a barrel from a record peak of more than $147 in July, depressed by the downturn in the world economy, which has hit demand for fuel.

Prices had broken a nine-session losing streak on Friday partly on evidence of OPEC compliance with its biggest ever production cut agreed earlier in December to try to halt the market’s slide.

Libya has told oil firms to curb output by 270,000 barrels per day from Jan. 1, more than the reduction it needs to make under OPEC’s agreement to cut output.

The Abu Dhabi National Oil Co, the UAE’s main producer, said it would cut January and February oil exports by much more than some refiners had expected.

The allocations were among the first concrete examples that OPEC exporters were implementing the Organization of the Petroleum Exporting Countries’ Dec. 17 deal to cut supplies by 2.2 million barrels per day.

Saudi Arabia, the world’s largest exporter, had informed its customers of cuts even before the meeting.

OPEC has cut output three times in an effort to remove about 5 percent of world supply to halt the slump.

China’s energy chief said the world’s second-largest oil user after the United States would take advantage of falling oil prices to boost imports and build up its fledgling oil reserves.

Jane Merriman LONDON, Dec 29 (Reuters)

Light, sweet crude for January delivery fell $3.54 to settle at $40.06 a barrel on the New York Mercantile Exchange – the lowest level since 2004. Oil futures actually traded as low as $39.88 during the day yesterday. The slide came in spite of an announcement by OPEC that the cartel would cut its production quotas by 2.2 million barrels per day (bpd), a record amount.

“The Conference observed that crude volumes entering the market remain well in excess of actual demand: This is clearly demonstrated by the fact that crude stocks in OECD countries are well above their five-year average and are expected to continue to rise,” the group said in a statement. “Moreover, the impact of the grave global economic downturn has led to a destruction of demand.”

Since September, OPEC – supplier of 40% of the world’s oil – has issued three production cuts totaling 4.2 million bpd, or nearly 12% of its capacity. Still, the cartel has failed to establish a floor for oil prices, which have tumbled more than 70% from their July 11 peak of $147 a barrel. Oil has now given up all of the price gains it has made since 2004, in just the past five months.

The main reason for the decline is that the global recession has curtailed demand significantly, leaving many developed nations, as well as the cartel, with a significant buildup of inventories.

The U.S. Energy Information Agency reported yesterday that crude oil inventories increased 500,000 barrels from the previous week, while OPEC’s commercial inventories now stand at 57 days’ worth of supplies. OPEC President Chekib Khelil, said that his group wants to push inventories down to 52 days’ worth of supply and lift prices back up to $70-$80 a barrel.

However, OPEC may find it difficult to achieve those goals without help from non-OPEC nations, which balked at efforts to make a coordinated global production cut. After rumors circulated prior to the meeting that Russia and Azerbaijan might take part in the cuts, their contribution to OPEC’s effort came out flat.

“Russian oil companies have already made a decision to cut deliveries to the market… approximately equivalent to 350,000 barrels per day,” Russian Deputy Premier Igor Sechin told The Associated Press. Sechin added that the cuts had already been implemented in November.

Russia’s lack of involvement did nothing for an oil market that was crying out for a coordinated global effort. In fact, the statement came off as a thinly veiled attempt to repackage the already apparent decline in Russian oil production that has resulted from a lack of investment.

Even before Sechin’s comments, analysts had forecast a 1% decline in Russian oil output for this year, and a 2% drop in 2009.

Azeri Energy Minister Natik Aliev said it would back OPEC’s move by cutting production by 300,000 bpd, more than a third of its total capacity. Still, analysts estimate that an accident that took place on the country’s main pumping platform in October had already cost the country 500,000 bpd in output.

“We want non-OPEC countries to contribute, and not just benefit from the impact of our cuts,” a frustrated Khelil said after the meeting in Oran, Algeria. “It’s in their own interest as well as in ours.”

A lack of foreign cooperation will put even more pressure on OPEC, and could force the group to call another “extraordinary” meeting before its next scheduled gathering, set for March 25, 2009.

“I hope we surprised you,” Khelil said when asked whether the size of the cut would provide enough of a spark to ignite oil markets. “If you’re not surprised we need to so something about it.”

Source: OPEC Production Cut Fails to Inspire Oil Market; Oil Drops to Four-Year Low

• South Africa’s central bank cut a half-percentage point from its benchmark interest rate, marking the country’s first interest rate reduction in more than three years, Bloomberg reported. The growing global crisis, rising unemployment and falling commodity prices are hampering growth for the emerging economy.

• Asset manager BlackRock Inc. (BLK) cut 500 jobs, Chief Executive Laurence Fink said Thursday. Many of the job losses were part-time employees, Reuters reported. BlackRock is the largest publicly traded U.S. asset manager.

• Second-quarter profit rose 13% for Empire Co., owner of Canada’s second-largest supermarket chain. Net income rose $53.6 million and revenue increased 7% for the three months through Nov. 1, Bloomberg reported.

• KB Toys Inc. yesterday (Thursday) filed for bankruptcy protection for the second time in four years and plans to hold going-out-of business sales at its stores immediately. The 86-year-old company said in a filing that its debt is “directly attributable to a sudden and sharp decline in consumer sales,” an indication of how poor this holiday season has been for many retailers.

• Light, sweet crude for January delivery yesterday (Thursday) rose $4.46 to settle at $47.98 a barrel on the New York Mercantile Exchange. Oil spiked 12% earlier in the day approaching $49 a barrel.

• Citigroup Inc. (C) and UBS AG (UBS) yesterday (Thursday) agreed to buy back a total of nearly $30 billion in risky auction-rate securities that the Securities and Exchange Commission said the banks marketed to customers as safe. Tens of thousands of the customers bought the auction-rate securities before the $330 billion market froze in mid-February, the SEC said.

• Bank of America Corp. (BAC) said yesterday (Thursday) that it plans to cut up to 35,000 jobs over the next three years. The bank said the reductions are aimed at eliminating redundancies resulting from its merger with Merrill Lynch & Co. Inc. (MER), as well as the recessionary environment.

Source: Global Investing Roundups Friday, December 12th, 2008

Light, sweet crude for January delivery rose $1.45,  or 3.4% to settle at $43.52 on the New York Mercantile Exchange, after climbing by as much as 7% earlier in the day. Futures have plunged roughly 70% since hitting a record-high $147.27 a barrel in July. However, they may be set for a rebound as traders close out short positions and production cuts offset slackening demand.

Traders who took short positions on crude contracts, or placed bets that prices would fall, are buying contracts to cover those bets now that oil has dropped more than 20% in the past two weeks. Their exit from the market has been expedited by the belief that prices are nearing a bottom, as well as suggestions that both OPEC and Russia will cut production next week.

Russia will air proposals on oil production cuts no later than December 17, Sergei Shmatko, the nation’s energy minister, told Interfax.

“Right now we need to see where we stand with respect to OPEC’s stated position,” Shmatko said. “I know that OPEC is preparing serious plans to cut production.”

Shmatko added that OPEC President and Algerian Oil Minister, Chekib Khelil was keen “to see Russia in OPEC,” but that Russia rather see “non-OPEC suppliers consolidate their position in order to keep the market stable.”

OPEC members are scheduled to meet in Algeria on Dec. 17 to discuss further production cuts. Oil has fallen more than 30% since the cartel last slashed its production quota, a 1.5 million barrel per day (bpd) reduction on Oct. 24. Analysts anticipate the OPEC that the next supply cut could be anywhere between 1.5 million bpd and 2.5 million bpd.

“The expectation of an OPEC cut is going some way toward curbing the downward momentum in prices,” Toby Hassall, an analyst at investment firm Commodity Warrants Australia, told The Associated Press. “A cut of 1.5 million to 2 million barrels a day seems like a reasonable range.”

Demand for oil has plunged over the past six months, with the onset of what is shaping up to be a severe global downturn. In its last monthly oil outlook, issued Nov. 17, OPEC trimmed its 2009 demand forecast by 530,000 to 86.68 million bpd. The Paris-based International Energy Agency is expected announce a cut to its 2009 forecast in its monthly report, set for release tomorrow.

Still, many analysts believe the market has “overshot” the downside to oil, and that further production cuts will be enough to create a floor for prices.

“We’re probably in the early stages of forming a base at the moment, and the price will likely edge up toward $60 or $70 by the middle of next year,” Hassall said. “We probably overshot on the downside the same way we overshot to the upside earlier this year.”

Source: Oil Prices Climb on Speculation that OPEC and Russia will Cut Production