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Breaking News | Real-time commentary on the market, with links to key sources.

Real Time - Market Currents
 Top Stories - Wall Street Breakfast
Monday, December 1 2008
Page auto-refreshes as new events occur (times are ET)
  • 3:23 PM The collapse of the BHP Billiton (BHP)/Rio Tinto (RTP) deal pushed the seesaw of merger volume to a rarely-seen balance: busted mergers ($322B) in Q4 nearly equaled mergers that were signed ($362B). Comment!
  • 3:10 PM Paulson: "Given that we have essentially guaranteed Fannie Mae and Freddie Mac securities, the rates on those securities – and corresponding mortgage rates – have not come down as much as we may have hoped." Comment!
  • 3:09 PM Paulson speech: "We expect banks to increase their lending as a result of these efforts and it is important that they do so. This lending won't materialize as fast as any of us would like, but it will happen much, much faster as confidence is restored as a result of having used the TARP to stabilize our system and to increase the capital in our banks." Comment!
  • 3:05 PM The Treasury rally took a break at midday, but has resumed with renewed force. 30-year +2.43%. 10-year +1.67%. 5-year +1%. 2-year +0.21%. Comment!
  • 3:04 PM With just under an hour to go, markets are barely above their lows. Dow -5.23% to 8362. S&P -6.2% to 841. Nasdaq -6.3% to 1439. Crude -9.6% to $49.22. Gold -5% to $775.30. Comment!
  • 2:52 PM At 12 months and counting, the current recession is already the third-longest since the Great Depression. Here are the gory details of all 15 since 1923. Comment!
  • 2:41 PM Black Friday shopping stats seem to lead to the same faulty conclusions year after year. (Big Picture) Comment!
  • 2:29 PM Morgan Stanley becomes one of the first to mention a Brazil recession. It expects growth of 2% next year, but "a figure closer to zero cannot be ruled out," economist Marcelo Carvalho says. EWZ -8.1%. It's down 56.1% over the past three months. Comment!
  • 2:17 PM Big banks (C, CS, JPM, UBS) are trying to muscle away M&A business from their boutique rivals (LAZ). Comment!
  • 2:06 PM Bernanke: One reason the actual fed funds rate is well below the 1% target "is the presence in the market of large suppliers of funds," notably Fannie Mae and Freddie Mac which aren't eligible to receive interest on reserves, and are thus willing to lend at rates below the target. "We will continue to explore ways to keep the effective federal funds rate closer to the target." Comment!
  • 2:01 PM Even if financial markets improve, economic conditions will probably remain weak for a time," Bernanke says. "In particular, household spending likely will continue to be depressed by the declines to date in household wealth, cumulating job losses, weak consumer confidence, and a lack of credit availability." Comment!
  • 1:53 PM While the NRA's Restaurant Performance Index posted a slight gain, the outlook for the restaurant industry remains weak. Only 20% of restaurant operators saw traffic higher this October than a year ago. Comment!
  • 1:52 PM Yet another sign early indications of strong holiday sales may be misleading: Gift card sales are down 10%. 1 Comment
  • 1:41 PM Monday movement in credit-default swaps on European corporate debt indicates things are still going to get much uglier. Comment!
  • 1:28 PM Canada's (ETF: EWC) economy manages to grow a better-than-expected 1.3% in Q3. For now, it's one of the few major economies that's managed to sidestep recession. Comment!
  • 1:15 PM The U.S. economy entered recession in December 2007, NBER decides, finally. At 12 months, the current contraction is already longer than the last slump that spanned March to November 2001. Previous calls have coincided with bottoms; this time too? Comment!
  • 1:03 PM Obama has demonstrated a surprising understanding of "how to get the hard-core capitalists on Wall Street to do his bidding," Peter Brown writes at Political Perceptions. His masterstroke (thus far)? Leaking Tim Geithner's appointment to Treasury Secretary. 1 Comment
  • 12:52 PM Clearwire (CLWRD) and Sprint Nextel (S -12.2%) close their multibillion dollar WiMAX JV, which combines the companies' wireless internet businesses and aims to begin rolling out the first nationwide 4G mobile broadband network in early 2009. Comment!
  • 12:35 PM Janet Maslin reviews The Man Who Owns the News, Michael Wolff’s "supercilious yet star-struck portrait" of Rupert Murdoch. "If Mr. Wolff envisioned this book as anything outside its subject’s control, he underestimated his already larger-than-life subject’s gifts as a control freak." Comment!
  • 12:22 PM Despite Apple's (AAPL) relatively modest holiday promotions, it appears to have started out the holiday shopping season very well indeed. 1 Comment
  • 12:10 PM Half of all private-equity buyouts completed over the past three years may run into trouble, LBO bankers say. "The outlook is so poor, credit is no longer available anywhere near the way it was before, so deleveraging has to take place." Comment!
  • 12:03 PM HuffPo takes on $25M, putting its value it at $115M. Noteworthy, among other reasons, for its extreme rarity in these months of tight walleted VCs. Comment!
  • 11:58 AM One would think flooding the bond market with new sales might cause yields to rise, yet so far the market has had no problem gobbling up everything the Treasury throws at it. Reverse crowding-out? Comment!
  • 11:50 AM Crude dips below $50, currently -8.2% to $49.98 (low :$49.52). 1 Comment
  • 11:42 AM Johnson & Johnson (JNJ -3%) proves high-premium buyouts are rare but not altogether dead with its near-100%-premium acquisition of breast-implant maker Mentor (MNT +89.4%). Counter-trade: Sell Allergan (AGN -8.3%). Comment!
  • 11:29 AM Two months after converting to a bank-holding company, Morgan Stanley (MS) looks to rev up its push into retail banking, including buying small-to-medium-sized regional banks. Comment!
  • 11:18 AM "The weekend did little to change our view that holiday sales will be anything but cheery," Pali Research says, adding it's even more concerned about what happens once the Christmas oomph fades, "and the macro reality sets back in." Use the recent rally to sell into strength, it says. Comment!
  • 11:06 AM Nokia (NOK) may unveil a notebook at its Capital Markets presentation Thursday, UBS says. Nokia already makes a line of internet tablets, and a notebook would be a natural step given its distribution scale. Meanwhile Scoble's looking for a high-end touchscreen on Wednesday. Comment!
  • 11:02 AM Buyers have yet to show up. Dow now down 4.6% to 8423. S&P -5.4% to 848. Nasdaq -5.4% to 1453. Crude's down 7.3% to $50.40. Comment!
  • 10:51 AM Despite 20% gains in broad indexes over the past couple weeks, investors should remain wary. "When the stock market is enduring its most volatile year since the 1930s, 19% isn’t a big cushion above the lows." More here. 1 Comment
  • 10:38 AM Citigroup is worried about GE's (GE) webcast to review GE Capital, noting that in prior years when Street estimates were too high, GE held late Nov./early Dec. meetings to lower expectations. Tomorrow's news isn't likely to be good. Comment!
  • 10:28 AM Construction Spending fell 1.2% in October to $1.072T. Economists expected a drop of 1%. Comment!
  • 10:25 AM Economic activity in the manufacturing sector fell in November for the fourth consecutive month, ISM says, down 2.7% to 36.2 vs. consensus of 37 (anything below 50 indicates contraction). New orders fell 4.3% to 27.9, the lowest since 1980. Comment!
  • 10:11 AM Dow leader: GM +4.2%. Laggards: C -9.3%. AA -8.3%. AXP -8.5%. BAC -7.88%. CAT -7.7%. JPM -7.4%. GE -7.4%. DIS -5.3%. DD -5.3%. CVX -5.1%. MMM -4.3%. HPQ -3.9%. Comment!
  • 10:09 AM Sector ETF weakness (sorry, no strength): Solar– TAN -12.4%. Coal– KOL -10%. Oil Services– OIH -9.9%. Steel– SLX -9.65%. Silver– SLV -9.4%. Real Estate– IYR -7.9%. Agribusiness– MOO -7.9%. Gold Miners– GDX -7.8%. Clean Energy– PBW -7.8%. Broker/Dealers– IAI -7.8%. Comment!
  • 10:04 AM 10-year notes are up an impressive 1.17%. The rest of the complex: 30-year +1.57%. 5-year +0.54%. 2-year +0.11%. Comment!
  • 10:03 AM Major indices continue to bleed. Dow -4% to 8475. S&P -4.7% to 855. Nasdaq -4.5% to 1467. Comment!
  • 9:57 AM The UAW and the Big Three (GM, F) are in talks to halt a program that pays idled workers, a.k.a. jobs banks. UAW's Ron Gettelfinger says he "understands the UAW is part of the solution here" and "doesn't want to be characterized as the problem." Comment!
  • 9:45 AM Ford (F +9.7%) says it will re-evalute its options for Volvo, including a possible sale, in light of the "significant decline in the global auto industry particularly in the past three months and the severe economic instability worldwide." Comment!
  • 9:42 AM Sharp losses early on in the week's first day. Dow -3.4% to 8526. S&P -4% to 860. Nasdaq -3.65% to 1480. Comment!
  • 9:28 AM America's Research Group sent out 14 researchers to scour 7-11 holiday retailers apiece. They found people were carrying fewer bags than last year; there was less impulse buying; and fewer people shopped after the early-bird specials Friday. Comment!
  • 9:21 AM GM's (GM) board is hellbent on securing a federal rescue loan. If they fail, everything's on the table, including Chapter 11. 1 Comment
  • 9:13 AM The Chinese yuan (ETF: CYB) fell 0.5% - its maximum - after a sharp drop in manufacturing activity has traders guessing the government will let the yuan depreciate to help bolster China's decelerating economy (ETFs: FXI, PGJ). Comment!
  • 9:09 AM Looking at stock futures, markets appear poised to open lower. Dow futures -2% to 8641. S&P -2.5% to 873. Nasdaq -2%. Comment!
  • 9:08 AM Crude trades below $51, -6.7% to $50.80. Comment!
  • 9:02 AM Dick Bove widens his 2008 loss forecast for Citigroup (C) to $2.79 from $2.44, and now sees a 2009 lost of $0.05 vs. +$0.79. 3 reasons: 1) 10% unemployment will push loan losses "much higher." 2) Gov't assistance will lead to more aggressive writeoffs. 3) $4.7B in dividend payments associated with new capital infusions. Premarket -3.75%. Comment!
  • 8:50 AM Securing a $45B jumbo loan to buy the remaining 44% of Genentech (DNA) seems increasingly unlikely for Roche (RHHBY.PK). Comment!
  • 8:41 AM Premarket losers: BCS -14%. GFA -13%. AAUK -13%. MER -10.5%. ACGY -10%. UBS -10%. IBN -8.5%. RTP -8%. ING -8%. AUY -8%. STP -8%. WFT -7.5%. RBS -7.5%. PBR -7.5%. SLV -9%. SLW -7%. PWE -7%. MT -7%. WPPGY -7%. Comment!
  • 8:41 AM Premarket gainers: MNT +88.3%. S +7.5%. F +5.5%. YHOO +4%. ROH +4%. DOW +3%. Comment!
  • 8:39 AM The U.K. government's banking industry bailout needs some work, key players warn. "They are making them do the wrong things – making them store up cash and then repay the government – when what you want them to be doing is lending out to businesses." 1 Comment
  • 8:30 AM Worldwide sales of semiconductors declined by 2.4% in October to $22.5B. Excluding memory products, sales were up 3.8% but down 1.4% vs. last month. SIA expects PC sales to deciline by 5% in 2009 and cell phone sales to drop a steeper 9%. Comment!
  • 8:17 AM The European Commission is blocking the French government's €10.5B plan to shore balance sheets of France's six main retail banks, insisting the banks must first reduce their lending. France is fuming over the intervention. 1 Comment
  • 8:06 AM There were clear signs that strong Black Friday sales were largely driven by door busters: First, Friday's momentum ebbed on Saturday. Second, as many as 70% of shoppers were purchasing only 'deeply discounted' merchandise. Online sales were up just 1%. Comment!
  • 7:54 AM Analysts say that despite OPEC's publicly-stated support of oil at around $75/barrel, the cartel is not cutting production fast enough to address the current drop in demand. Last time OPEC failed to eliminate a supply glut, in 1998, crude bottomed at $10.35. Comment!
  • 7:39 AM A key player says media reports that Microsoft (MSFT) in in talks to buy Yahoo's (YHOO) search business for $20B are total fiction. Comment!
  • 7:27 AM Sumner Redstone's holding company, National Amusements, will announce today it's selling its 87% stake in Midway Games (MWY) to investor Mark Thomas for $100,000 and the assumption of $70M in debt. The sale is expected to ease pressure on the family's stressed relationship with its lenders. Comment!
  • 7:00 AM U.S. futures indicate a weak open to the week. Dow -1.8% to 8664. S&P -2.3% to 875. Nasdaq -2.1%. Crude -4.2% to $52.15. Gold -3.15% to $790.50. Comment!
  • 7:00 AM In Europe, markets are near their lows at midday. London -2.5%. Paris -2.5%. Frankfurt -3.2%. Comment!
  • 7:00 AM Asia markets were mixed Monday. Japan's Nikkei fell 1.35% to 8,397. Hang Seng +1.59% to 14,109. Shanghai +1.25% to 1,895. BSE Sensex -2.78% to 8,840. Comment!
  • 6:56 AM U.K. manufacturing shrank at the fastest pace in at least 16 years in November, increasing pressure on the BoE to slash interest rates again this week. The Chartered Institute of Purchasing and Supply’s factory index dropped to 34.4, the weakest since the data began in 1992. (ETF: EWU) Comment!
  • 6:11 AM Citigroup's (C) infrastructure fund, Citi Infrastructure Partners, agrees to buy troubled Spanish highway operator Itinere Infraestructuras from Sacyr Vallehermoso for €7.9B. Analysts say Sacyr sold out cheap in desperation. Citigroup is up 12% premarket. Comment!
  • 3:02 AM The gold/silver ratio is starting to tighten a bit. Comment!