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Oct 3, 2012

DealBook Afternoon Edition -October 3, 2012-: T-Mobile Seals Deal With MetroPCS

Wednesday, October 3, 2012
A T-Mobile store in New York.
T-Mobile Seals Deal With MetroPCS The parent company of T-Mobile USA agreed to buy MetroPCS on Wednesday as the cellphone providers looked to compete with bigger rivals.
A Law Firm Name With a Curious Ring In the news release announcing the T-Mobile and MetroPCS merger, an advisory firm's name on the roster stood out from the rest: Telecommunications Law Professionals.
    Standard Deduction: Overseas Cash and the Tax Games Multinationals Play Victor Fleischer asks what to do with a tax system that invites gamesmanship by American companies and their advisers?
    Carlyle Buys Control of a Commodities Trader The Carlyle Group says it has taken a 55 percent stake in Vermillion Asset Management, a commodities hedge fund with about $2.2 billion in assets. Carlyle, which paid a mix of stock and cash, will make Vermillion its main commodities trading platform.
    Telefonica to Take German Unit Public Telefónica of Spain plans to take its German unit public on the Frankfurt Stock Exchange by year's end as part of its efforts to reduce debt.
    Buzz Tracker
    The Rise and Fall of JPMorgan's Ina Drew Ina Drew "ascended to a level of power and wealth that few women have known" on Wall Street, Susan Dominus writes in The New York Times Magazine. Then she became the public face of the bank's multibillion-dollar trading loss, a blunder that cost Ms. Drew her job. "This is a scorching moment of failure from which it could be hard to recover."
    Economic Reports Data to be released on Thursday include weekly jobless claims.
    In the United States On Thursday, retailers will report their same-store sales for September, and the Federal Reserve will release minutes of its Sept. 12-13 policy-setting meeting.
    Overseas Ceatec Japan, a consumer electronics convention, takes place in Tokyo through Friday. On Thursday, the European Central Bank and the Bank of England will issue decisions about interest rates. Mario Draghi, the president of the European Central Bank, may provide details about the bank's bond-buying program.

CBS NEWS | Political Hotsheet Top Stories -October 3, 2012-.: Ryan: Romney will hit Obama in debates

The CBS News Political Hotsheet newsletter


Republican VP nominee Paul Ryan expressed confidence Wednesday in nominee Mitt Romney's debating skills
Read full story
Ryan: Romney will hit Obama in debates

Air Force One aborts initial landing approach President's aircraft delayed landing due to cloudy weather, landed "uneventfully" shortly after

Obama: Romney's tough talk on China The president tells college students in Ohio that his GOP rival's record of profiting from outsourcing doesn't align with his rhetoric on China

Romney: Don't expect The nominee focused his Ohio pitch on one of the few areas where he continues to lead President Obama: Paying down the debt

China still a major issue in Ohio Both candidates politicize China's economic strength to invoke fear in Rust Belt middle-class voters

Money Show Investors Daily Alert -October 3, 2012-: MoneyShow Sentiment Indicator

Investors Daily Alert
Special Commentary

The Daily Guru
3 Glowing Uranium Stocks, John Manfreda

Jim Jubak on

Today's Top Pros' Top Picks
Can Your PC Save Your Life?, Michael A. Robinson

Today's Gurus' Views & Strategies

Today's Charts in Play

Portfolio Strategies

Ideas from Around the World

Today's Featured Videos & Exclusive Interviews

GATA | THE GATA DISPATCH -October 3, 2012-.Felix Moreno de la Cova: Revisiting 'Gold Wars' by Ferdinand Lips

Felix Moreno de la Cova: Revisiting 'Gold Wars' by Ferdinand Lips

3:46p ET Wednesday, October 3, 2012

"Gold Wars" by the late Ferdinand Lips, the history of Western central banking's struggle to deprive humanity of the best and most democratic money, has just been published in a Spanish edition, and the Spanish economist and trader Felix Moreno de la Cova celebrated it in a recent speech delivered in Madrid. An excerpt from that speech has been put into English and posted at GoldMoney's Internet site.

De la Cova says: "'Gold Wars' is the story of the rise of fiat currency and the demise of gold-backed money over the 20th century: from the collapse of the classical gold standard at the outbreak of the First World War in 1914, through the protectionism and trade wars of the 1930s, to the rise of the Bretton Woods system postwar, and the failure of the London Gold Pool and Nixon's 'gold shock' in 1971. He examines the determined monetary war -- or gold war -- the globe's financial elite fought against Switzerland during the 1990s, and how his country was sold out by its politicians and high financiers, a process Lips calls 'the betrayal of Switzerland.' Readers may find it fitting that Lips ends his narrative in 2001, at the point of maximum pessimism in the gold market, but which is now clearly visible as the year in which the metal's latest and perhaps greatest bull market got under way."

GATA is cited favorably by Lips in "Gold Wars."

De la Cova's remarks are headlined "'Gold Wars' Revisted" and they're posted at GoldMoney here:

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

Stocks and Markets in the News | Wall Street at Close Report | MarketWatch -October 3, 2012-.

U.S. Markets

Dow settles off session highs; S&P 500 up LOS ANGELES (MarketWatch ) -- U.S. blue-chip stocks closed higher Wednesday, with modest gains following upbeat data on private-sector job growth and activity in the services sector. "Stocks [drifted] slightly higher mostly from a lack of sellers in this liquidity-driven market. With rates so low, stocks win by default," said Keith Springer, president of Springer Financial Advisors in Sacramento, Calif. The Dow Jones Industrial Average rose 12.25 points, or 0.1%, to 13,494.61, with shares of Home Depot Inc. topping advancers. Blue-chips fell into the red during the session, hurt in part by a plunge in shares of Hewlett-Packard Co. after the company issued a weak yearly forecast. The S&P 500 Index logged its third day of gains, ending up by 5.24 points, or 0.4%, at 1,450.99. The Nasdaq Composite Index finished up 15.19 points, or 0.5%, at 3,135.23. 3 min ago

the Economist | New Selected Articles -October 3, 2012-.: Election 2012: The Amish perspective

Lexington's notebook: Back to Lancaster county
What do the Amish think of a Mormon presidential candidate?
read more »
Feast and famine: The finest tradition of Australian diplomacy
Kevin Rudd, a former prime minister, attacks the UN's record on feeding the world
read more »

Democracy in America: Blame Mars, not Venus
The movement of men away from the Democratic Party is the main driver of the gender gap
read more »

Schumpeter: Mohammad Yunus on social business
The founder of Grameen Bank on why politics should not interfere with its operation, and how a new model of business divorced from profitmaking could address social ills
read more »
Daily chart: The urbanisation trap
Moving from farms to cities does not always translate to gains in income
read more »


Ntew York Times | Opinion Today -October 3, 2012-.

The New York Times

October 3, 2012

Opinion Today

Campaign Stops

What Mitt Should Tell the 47 Percent

On taxes, health care and Medicare reform, Romney should strike a more populist note.
Op-Ed Contributor

A Glimmer in the Vast Wasteland

Despite a rocky history, the presidential debates are one place in the modern campaign - perhaps the only place - where the voter is treated with respect.
No Longer Debatable - Campaigns Matter
Opinionator | The Conversation

No Longer Debatable - Campaigns Matter

Brooks and Collins on zingers, swing state voters and the white working class gender gap.
A Better Approach to Presidential Debates
Room for Debate

A Better Approach to Presidential Debates

Changes large and small could improve the presidential debates. Or are they a lost cause
That Flawed Stanford Study

That Flawed Stanford Study

Sorry, but there really is a difference between organic and conventional foods.

'Electoral College 101'

In the latest episode of the Op-Docs series "Electoral Dysfunction," the political humorist consults a third-grade class on the fairness of the Electoral College.
Opinionator | Fixes

Bridging the Clothing Divide

In the poorest places, the lack of proper clothing costs lives. Now a simple and efficient program in India is attacking the problem with the urgency it deserves.
Op-Ed Contributors

Spanish Prisoners

Spain can't continue using taxes to usurp the wealth of its richest regions. The time has come for Catalonia to secede.
Death in a Hundred Shapes
Opinionator | Disunion

Death in a Hundred Shapes

The great chess game that unfolded across the South in 1862 ended in October with the terrible Battle of Corinth.
Stone Links: Beyond Athens and Jerusalem?
Opinionator | The Stone

Stone Links: Beyond Athens and Jerusalem?

In this week's links: rethinking the reason-revelation divide, broadening experimental philosophy, Adorno the critic, and more.

Mr. Schneiderman Presents His Case

New York's attorney general uses state law to expose a broad pattern of mortgage fraud.

Temporary Voter Relief in Pennsylvania

A judge lifts the ID requirement for the November election, but a bad law lives on as a sleazy legacy of voter suppression.

Justice Under the Law of Nations

Noncitizens should be allowed to sue international corporations that do business in the United States for human rights abuses abroad.

Mistrust in California

Gov. Jerry Brown disappointed many after he vetoed a bill aimed at keeping harmless immigrants out of the deportation dragnet.

The Opinion Pages

Read the full opinion report, including editorials, columns, op-eds and Opinionator. Go to the Section »
Send in Your Questions for the Debate
Taking Note

Send in Your Questions for the Debate

What would you ask if you were moderating?
The Economic Consequences of Mr. Rajoy
The Conscience of a Liberal

The Economic Consequences of Mr. Rajoy

What history says about internal devaluation.
Our Jerusalem

Our Jerusalem

The Palestinian president had vowed to be more sensitive to Jewish claims over Jerusalem, but his U.N. speech was a rhetorical trick.

ADVFN III Evening Euro Markets Bulletin -October 3, 2012-.

ADVFN III Evening Euro Markets Bulletin
Daily world financial news

Wednesday, 03 October 2012

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London close: US data provides a late boost
Market Movers
  • techMARK 2,143.41 +0.24%
  • FTSE 100 5,825.81 +0.28%
  • FTSE 250 11,872.73 -0.18%
- US services and labour figures lift stocks
- Mixed economic data in China, UK and Europe
- FTSE 100 finishes up 0.3 per cent

The UK benchmark finished with mild gains on Wednesday afternoon after some better-than-expected data from the US managed to brighten the mood, which was dampened earlier by gloomy figures from China, Europe and the UK.

In the US, ADP non-farm payrolls increased by 162,000 following a revised 189,000 rise in August (previously 201,000). The consensus estimate as for a gain of 140,000. Meanwhile, the ISM non-manufacturing purchasing managers' index (PMI) rose from 53.7 to 55.1 and ahead of the 53.4 forecast.

"The outcome of Friday's jobs numbers is likely to dictate sentiment near-term. Importantly, the decent ADP figure today has presented more downside risk by way of renewed positive expectations should non-farm disappoint," said financial trader David White from Spreadex.

Non-manufacturing PMIs in both China and the UK fell by more than expected in September, while Chinese consumer sentiment dropped to its lowest level since December. Meanwhile, the Markit Eurozone PMI composite output index (which reflects a weighted-average combination of the manufacturing and services sector in the region) hit a four-month low, though it was slightly ahead of estimates.

Spanish Prime Minister Mariano Rajoy yesterday denied claims that his country is looking to request a bailout this weekend. He said that the country had no immediate plans to ask for aid, but analysts such as Craig Erlam from Alpari say that a bailout is a "foregone conclusion".

In other news today, crude futures fell by as much as 3.5% after the US Energy Department revealed that oil production jumped to 6.52m last week, a 15-year high, while fuel consumption fell.
FTSE 100: Sainsbury and Tesco head opposite ways
After an earlier fall, retailing giant Sainsbury was higher the afternoon after saying it had outperformed the market in the second quarter, with total sales up 4.4% excluding fuel and like-for-like (LFL) sales up 1.9%.

However, sector peer Tesco was still in the red after its interim results. The supermarket colossus said that pre-tax profits (pre exceptionals and property profits) fell 15%, worse-than-expected according to Seymour Pierce, which labelled them as "disappointing" this morning. The company saw a return to LFL sales growth in the second quarter, although it has had to sacrifice margin to do so.

International Airlines Group (IAG) was flying higher after saying that September traffic figures had been boosted by heavy promotional activity by British Airways during and after the Olympic Games.

Pearson, the education and publishing firm, dropped after revealing that its Chief Executive Officer Marjorie Scardino has decided to call it quits at the end of the year. 

Asset manager Schroders was unwanted after UBS cut its rating on the stock from 'neutral' to 'sell'. "We believe that expectations on flows and on capital returns have led the stock to re-rate vs peers while we remain cautious on both points," the broker said.

Capita, the outsourcing group, fell after it said it is aware that the Home Office is pursuing discussions with another supplier with the intention of awarding them a contract to support the new Disclosure and Barring Service (DBS) operations, which are part of the coalition's agreement to review and reform the criminal records system.

Anglo American fell after its platinum division, Amplats, saw wildcat strikes spread to its Union Mine in Limpopo Province, to the northwest of Rustenburg.

Heading the other way was mining group Xstrata after raising its copper mineral resource estimate at the major long-life development El Pachn project in San Juan Province, Argentina, by 20%. UBS upgraded the stock, along with potential merger partner Glencore, from 'neutral' to 'buy' today, saying that the deal is "highly likely to go through".

Meanwhile, Centrica was gaining after Citigroup raised its recommendation to 'buy' and lifted its target from 315p to 360p. Analyst Robert Coates said: "This current valuation in our opinion does not reflect the defensive profile of the stock or the potential upside from deploying the increasing free cash flow."
FTSE 250 movers: FirstGroup plunges after DfT decision
Shares in transport firm FirstGroup took a hammering today after the Department for Transport (DfT) dropped the competition to award it the West Coast franchise. Following a legal challenge from current operator Virgin Rail, the DfT said it had found "significant technical flaws in the way the franchise process was conducted" and was launching a review.

Stagecoach, part owner of the Virgin Rail joint venture with Virgin Group, was in demand after saying it was in discussions with the government regarding the rail franchising review.

BTG, the specialist healthcare company, jumped after reporting it had outperformed in the first half and was boosting its revenue expectations for the full year.

Budget airline easyJet was in demand after a surge in business at the end of the summer and a benign operating environment means it was upping its full-year profit forecasts.

FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 163.70p +2.96%
ARM Holdings (ARM) 589.00p +2.08%
Centrica (CNA) 334.00p +1.89%
Vedanta Resources (VED) 1,061.00p +1.82%
SSE (SSE) 1,416.00p +1.80%
Carnival (CCL) 2,313.00p +1.80%
Sainsbury (J) (SBRY) 352.50p +1.64%
Hargreaves Lansdown (HL.) 644.50p +1.34%
Eurasian Natural Resources Corp. (ENRC) 316.30p +1.28%
HSBC Holdings (HSBA) 587.70p +1.24%

FTSE 100 - Fallers
Anglo American (AAL) 1,818.00p -3.04%
Tesco (TSCO) 327.95p -2.60%
Weir Group (WEIR) 1,762.00p -2.00%
Capita (CPI) 763.00p -1.61%
Croda International (CRDA) 2,409.00p -1.55%
Tullow Oil (TLW) 1,396.00p -0.99%
Johnson Matthey (JMAT) 2,417.00p -0.98%
Severn Trent (SVT) 1,665.00p -0.95%
IMI (IMI) 940.50p -0.95%
Admiral Group (ADM) 1,054.00p -0.94%

FTSE 250 - Risers
BTG (BTG) 363.20p +9.04%
Dunelm Group (DNLM) 680.00p +3.82%
easyJet (EZJ) 615.00p +3.54%
NMC Health (NMC) 194.70p +3.51%
Home Retail Group (HOME) 92.95p +3.16%
Domino Printing Sciences (DNO) 569.50p +2.98%
Yule Catto & Co (YULC) 172.90p +2.73%
London Stock Exchange Group (LSE) 980.00p +2.46%
TUI Travel (TT.) 241.00p +2.25%
Centamin (DI) (CEY) 96.00p +2.13%

FTSE 250 - Fallers
FirstGroup (FGP) 193.40p -20.74%
Ruspetro (RPO) 101.50p -5.58%
PayPoint (PAY) 741.00p -3.77%
Morgan Crucible Co (MGCR) 271.50p -3.35%
Lonmin (LMI) 537.00p -3.33%
Pace (PIC) 166.80p -2.91%
Inmarsat (ISAT) 570.00p -2.56%
Spirent Communications (SPT) 150.60p -2.40%
Smith (DS) (SMDS) 186.80p -2.35%
Diploma (DPLM) 465.00p -2.31%

Europe Market Report
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FTSE 100EuronextDax perfCAC 40
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Europe close: US numbers compensate for weak Spanish data
-Eurozone services PMI slightly ahead of forecasts
-Spanish 10 year bonds are up by 6 basis points to 5.81%
-Weak Spanish services PMI reading

FTSE-100: 0.28%
Dax-30: 0.22%
Cac-40: -0.24%
FTSE-Mibtel 30: 0.25%
Ibex 35: -0.51%
Stoxx 600: -0.09%

European equities finished the day in a mixed fashion despite the release of important economic indicators Stateside this afternoon. That as investors hold out for tonight's televised election debate, the first in this US Presidential campaign. Worth noting in that regard, some of the latest polls now point to Obama holding on to a small lead.

Vestas Wind Systems fell after a lacklustre performance on the part of management at a capital markets day for the firm.

Telefonica has announced its intention to float its German unit this October.

Catering services firm Sodexo is climbing after Credit Suisse Group AG raised the company to outperform, from neutral.

From a sector stand-point the best performance on the DJ Stoxx 600 was seen in the following industrial groups: Utilities (0.66%), Food (0.23%) and Travel&Leisure (0.22%).
Positive surprise in Eurozone retail sales, but...
The Eurozone services sector purchasing managers' index for the month of September has come in at 46.1 points, versus 46.3 for the month before (Consensus: 46).

Chris Williamson, Chief Economist at Markit said: "The final Eurozone PMI came in slightly higher than the flash estimate but still signalled one of the steepest monthly downturns seen over the past three years. It seems inevitable that the region will have fallen back into recession in the third quarter."

The Irish unemployment rate for the month of September has remained unchanged at 14.8%, although the previous month's reading has been revised up by a tenth of a percentage point.

Eurozone retail sales rose by 0.1% month-on-month in August (Consensus: -0.1%). The previous month's reading was revised up to show a gain of 0.1% on month versus a preliminary estimate of -0.2%.

Worth pointing out, the extremely weak reading for today's Spanish services sector PMI, which came in at 40.2 (Consensus: 42), after a reading of 44 for August.
Oil futures fall

The euro/dollar is now down by 0.10% to the 1.2906 dollar mark.

Front month Brent crude futures are off by 2.273 dollars to the 109.09 dollar level on the ICE at the moment.
US Market Report
US mid-morning: Positive data surprises buoy stocks
-Positive data surprises
-Sharp fall in crude futures
-Krugman: US and EU nowhere close to ending financial crisis
-Mortgage refinancings rise by 16.6 per cent
-HP plummets after warning

Dow Jones Industrial: 0.26%
Nasdaq Comp.: 0.61%
S&P 500: 0.50%

US equities are moving forward following the release of better than expected macroeconomic data this morning and despite a sharp fall in crude futures which is weighing down on the most heavily capitalized equity sector of them all energy.

That ahead of tomorrow's meetings of the Bank of England (BoE) and the European Central Bank (ECB), not to mention this next Friday's monthly employment report Stateside and tonight's televised Presidential debate, the first of the season.
Hewlett Packard guides lower
On the corporate front, consumer electronics retailer Best Buy is seeing buying interest on reports that buy-out firms, as well as its founder, are sniffing about. Private equity snipers are also said to be putting grocery chain Supervalu in their sites, with a view to breaking it up.

Hewlett Packard is leading fallers on the Dow Jones after guiding for earnings per share this year of between 3.40 and 3.60 dollars, versus the 4.18 expected by the analyst consensus.

Sticking with the retail sector, Family Dollar Stores banged out fiscal fourth quarter earnings per share of 69 cents on the back of 11% year-on-year sales growth.

Monsanto is down after providing lower than expected full-year earnings per share guidance.
Mortgage refinancings make a come-back?

Payrolls processing firm ADP's September report indicated the private sector added 162,000 names to its payrolls, following a revised 189,000 increase in August (down from a preliminary reading of 201,000). Market pundits had been expecting September's rise to be of around 140,000.

Of note, gains were led by small company hiring (+81,000).

The ISM non-manufacturing sector index for September has printed at 55.1, following a reading of 53.7 for August (Consensus: 53.4). 50.0 is the cut-off point between expansion and contraction.

The new orders sub-index rose to 57.7 from 53.7 previously.

Not to be dismissed, mortgage refinancings increased at a 16.6% clip last week. Sharp fall in West Texas crude futures

Front month West Texas crude futures are down by 2.99 dollars after the US Energy Department said crude output rose 11,000 barrels a day to 6.52m last week, the most since December 1996.

10 year US Treasuries are now falling by 3/32 dollars, with yields at 1.63%.S&P 500 - Risers
Netflix Inc. (NFLX) $61.33 +8.63%
Lennar Corp. Class A (LEN) $37.50 +7.17%
PulteGroup Inc. (PHM) $16.55 +6.36%
D. R. Horton Inc. (DHI) $21.98 +6.13%
Sprint Nextel Corporation (S) $5.09 +3.98%
Masco Corp. (MAS) $15.96 +3.84%
Family Dollar Stores Inc. (FDO) $68.42 +3.66%
Best Buy Co. Inc. (BBY) $17.58 +3.59%
Crown Castle International (CCI) $66.62 +3.14%
Salesforce.Com Inc. (CRM) $157.54 +3.01%

S&P 500 - Fallers
Metropcs Communications Inc. (PCS) $12.50 -7.90%
Hewlett-Packard Co. (HPQ) $15.85 -7.48%
Helmerich & Payne Inc. (HP) $45.74 -3.07%
Advanced Micro Devices Inc. (AMD) $3.17 -3.06%
First Solar Inc. (FSLR) $22.26 -2.71%
Newfield Exploration Co (NFX) $30.40 -2.56%
Chesapeake Energy Corp. (CHK) $19.04 -2.56%
Phillips 66 Common Stock (PSX) $45.24 -2.55%
Baker Hughes Inc. (BHI) $43.96 -2.51%
Nabors Industries Ltd. (NBR) $13.66 -2.50%

Dow Jones I.A - Risers
Bank of America Corp. (BAC) $9.10 +1.90%
Walt Disney Co. (DIS) $52.59 +1.84%
Home Depot Inc. (HD) $61.30 +1.61%
AT&T Inc. (T) $38.24 +1.14%
Cisco Systems Inc. (CSCO) $19.08 +1.11%
Wal-Mart Stores Inc. (WMT) $74.57 +1.11%
Procter & Gamble Co. (PG) $69.47 +0.99%
Microsoft Corp. (MSFT) $29.93 +0.90%
Pfizer Inc. (PFE) $25.33 +0.84%
Merck & Co. Inc. (MRK) $45.83 +0.79%

Dow Jones I.A - Fallers
Hewlett-Packard Co. (HPQ) $15.85 -7.48%
Chevron Corp. (CVX) $116.91 -0.89%
Caterpillar Inc. (CAT) $85.08 -0.46%
Alcoa Inc. (AA) $8.82 -0.34%
Exxon Mobil Corp. (XOM) $91.62 -0.11%
McDonald's Corp. (MCD) $90.85 -0.09%
Intel Corp. (INTC) $22.83 -0.04%

Nasdaq 100 - Risers
Netflix Inc. (NFLX) $61.33 +8.63%
Sirius Satellite Radio Inc. (SIRI) $2.69 +2.67%
Expedia Inc. (EXPE) $57.85 +2.09%
CH Robinson Worldwide Inc (CHRW) $59.73 +1.93%
Express Scripts Holding Co (ESRX) $64.98 +1.84%
Intuit Inc. (INTU) $60.86 +1.69%
Virgin Media Inc. (VMED) $30.42 +1.67%
Sears Holdings Corp. (SHLD) $56.32 +1.66%
Yahoo! Inc. (YHOO) $16.20 +1.63%
Gilead Sciences Inc. (GILD) $70.26 +1.57%

Nasdaq 100 - Fallers
NetApp Inc. (NTAP) $31.69 -2.34%
Research in Motion Ltd. (RIMM) $8.12 -1.81%
Apollo Group Inc. (APOL) $28.50 -1.77%
Green Mountain Coffee Roasters Inc. (GMCR) $23.59 -1.67%
Fossil Inc. (FOSL) $85.35 -1.41%
Dell Inc. (DELL) $9.79 -1.11%
Randgold Resources Ltd. Ads (GOLD) $123.10 -0.86%
Altera Corp. (ALTR) $33.71 -0.85%
Seagate Technology Plc (STX) $30.06 -0.74%
Baidu Inc. (BIDU) $111.51 -0.73%
Broker Tips
Broker tips: Tesco, Schroders, FirstGroup
Seymour Pierce has retained its 'reduce' rating for supermarket giant Tesco after the group's first-half profits came in well below expectations.

Tesco this morning reported a 15% drop in first-half profit before tax (pre exceptionals and property profits) to 1,497m, under Seymour Pierce's 1,603m forecast. Trading profits fell in the UK, Asia and in Europe, while US losses were worse than expected.

"The market was prepared for a decline in profits but this is a disappointing statement even in that context we believe," said analyst Kate Calvert.

UBS has cut its recommendation for asset manager Schroders from 'neutral' to 'sell', saying that expectations are too high.

"We downgrade Schroders to 'sell' as we believe that expectations on flows and on capital returns have led the stock to re-rate vs peers while we remain cautious on both points," the broker said.

Jefferies has reiterated its 'hold' recommendation for transport firm FirstGroup after the government's decision to cancel the West Coast franchise competition, adding that it will have an adverse impact on sector peers Go-Ahead and National Express.

Delays in the franchising process are small negatives for Go-Ahead and National Express, the broker said, as they are shortlisted in the other live franchise contests: the Great Western, Essex Thameside and Thameslink franchises' timetables will likely be delayed as a result of the governmental reviews.

ADVFN III World Daily Markets Bulletin -October 3, 2012-.

ADVFN III World Daily Markets Bulletin
Daily world financial news

Wednesday, 03 October 2012

US Market
Stocks Turning In A Lackluster Performance In Early Trading
Stocks have shown a lack of direction over the course of early trading on Wednesday, as traders seem reluctant to make any significant moves. The major averages are lingering near the unchanged line after ending each of the two previous sessions mixed.
The major averages are currently turning in another mixed performance, with the Nasdaq clinging to a modest gain. While the Nasdaq is up 1.68 points or 0.1 percent at 3,121.72, the Dow is down 23.72 points or 0.2 percent at 13,458.64 and the S&P 500 is down 1.57 points or 0.1 percent at 1,444.18.
The choppy trading on Wall Street comes as traders appear to be staying on the sidelines ahead of Friday's monthly jobs report from the Labor Department.
While payroll processor Automatic Data Processing, Inc. (ADP) released a report showing stronger than expected private sector job growth in the month of September, the impact has been limited as recent ADP data has not matched up with the more closely watched government data.
ADP said private sector employment increased by 162,000 jobs in September compared to economist estimates for an increase of about 140,000.
At the same time, the job growth in previous months was revised lower, with the July growth reduced by 17,000 to an increase of 156,000 jobs and the August growth lowered by 12,000 to an increase of 189,000 jobs.
Peter Boockvar, managing director at Miller Tabak, said, "In terms of the market response, ADP has lost its month to month relationship to the government payroll figure and thus makes today's market move possibly completely different from this Friday."
Friday morning, the Labor Department is scheduled to release its monthly employment report, which includes both public and private sector jobs.
Most of the major sectors are showing only modest moves in early trading, although weakness has emerged among oil service stocks. The Philadelphia Oil Service Index is down by 1.4 percent, with the weakness in the sector coming amid a Sharp drop by the price of Crude oil.
Steel, natural gas, and gold stocks have also moved to the downside, while notable strength is visible among housing stocks.
In overseas trading, stock markets across the Asia-Pacific region turned yet another mixed performance on Wednesday. While Japan's Nikkei 225 Index fell by 0.5 percent, Hong Kong's Hang Seng Index edged up by 0.2 percent.
The major European markets have also turned mixed on the day. The French CAC 40 Index is down by 0.3 percent, while the U.K.'s FTSE 100 Index and the German DAX Index are both up by 0.1 percent.
In the bond market, treasuries have moved modestly lower after ending the previous session slightly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, has edged up by 1 basis point to 1.625 percent.

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TSX Flat Amid Mixed Cues - Canadian Commentary
Canadian stocks were struggling to move higher Wednesday morning amid anxiety over Spain's bailout plan after Spanish Prime Minister Mariano Rajoy played down expectations of an immediate bailout for his debt-ridden nation. Furthermore, weak manufacturing data out of Europe kept a check on gains, even as upbeat macroeconomic data out of U.S supported trader sentiment.
Payroll processor ADP reported that private sector employment in the U.S. rose by more than expected and the ISM revealed that activity in the U.S. service sector expanded for the 33rd consecutive month in September.
The S&P/TSX Composite Index eased 7.90 points or 0.06 percent to 12,383.33, after adding about 75 points or 0.60 percent in the past two sessions.
Among base-metals stocks, First Quantum Minerals gained about 2 percent and Teck Resources gathered close to 1 percent.
Today's data from the EIA revealed that U.S. crud oil inventories unexpectedly edged down 0.50 million barrels, while gasoline stocks moved up 0.10 million barrels in the weekended September 28. Analysts expected Crude oil inventories to move up 1.5 million barrels and gasoline stocks to remain flat last week. Crude for November lost $2.84 to $89.05 a barrel.
In the oil patch, Niko Resources surged 6 percent. Canadian Natural Resources entered into a long term gas processing agreement with a North American infrastructure company, primarily to reduce CO2 emissions at Horizon. The stock shed nearly 2 percent.
MEG Energy (MEG,TO), Bonavista Energy and Cenovus Energy were down around 2 percent each.
Gold stocks were trading marginally higher as the price of gold was steady near its seven-month high Wednesday morning as the U.S. dollar was little changed versus a basket of currencies amid private sector employment report from the ADP. gold for December gained $5.00 to $1,780.60 an ounce.
Goldcorp. , Agnico-Eagle Mines and Detour Gold edged up around 0.50 percent each.
International gold miner Barrick gold Corp. inched up 0.15 percent after it said it does not recommend or endorse an unsolicited mini-tender offer made by TRC Capital Corp. to purchase up to 2.50 million Barrick common shares, or approximately 0.24 percent of its outstanding common shares, at C$39.05 per share Shares of Barrick .
Meanwhile, media holding company Quebecor Inc. (QBR_A.TO, QBR_B.TO) slipped over 1 percent after it said it would, along with its majority owned unit Quebecor Media Inc., buy back a part of Quebecor Media stake owned by Caisse de depot et placement du Quebec for C$1.5 billion.
Information solutions provider MacDonald Dettwiler (MDA.TO) eased 0.25 percent after announcing that it received a follow-on contract for $9.8 million to map soil characterization and terrain globally.
In economic news from the U.S., the Automatic Data Processing, Inc. (ADP) said private sector employment increased by 162,000 jobs in September compared to economist estimates for an increase of about 140,000. At the same time, ADP said the job growth in the previous months was revised lower, with the July growth reduced by 17,000 to an increase of 156,000 jobs and the August growth lowered by 12,000 to an increase of 189,000 jobs.
A report released by the Institute for Supply Management revealed that its non-manufacturing index climbed to 55.1 in September from 53.7 in August, with a reading above 50 indicating an increase in activity in the service sector. The increase surprised economists, who had expected the index to edge down to 53.5.
Elsewhere, euro zone's private sector contracted at a slower pace than estimated earlier in September, a detailed result of a survey by Markit Economics showed. The composite output index, that measures performance of both manufacturing and service sectors, fell to a four-month low of 46.1 in September from 46.3 in August. This was slightly above the flash estimate of 45.9.
Germany's services sector contracted in September, according to final data from Markit Economics. The Services Business Activity Index came in at 49.7 in September, up from 48.3 in August, survey data revealed.
Meanwhile, data from Eurostat showed that euro zone retail sales rose unexpectedly in August. Retail sales were up 0.1 percent on a monthly basis, the same rate of growth as seen in June and July. Economists had forecast a 0.1 percent drop for August.

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European Markets Mixed Amid Spanish Concerns
The European markets are trading mixed on Wednesday, as investors remained weary about the delay in the bailout request from Spain. The Asian markets ended mixed after data showed that China's service sector performance declined in September, suggesting a more moderate expansion of operating conditions in the sector.
Germany's services sector contracted in September, final data from Markit Economics showed. The Services Business Activity Index came in at 49.7 in September, up from 48.3 in August. However, the reading was below the flash estimate of 50.6.
Meanwhile, data from Eurostat showed that Eurozone retail sales rose unexpectedly in August. Retail sales were up 0.1 percent on a monthly basis, the same rate of growth as seen in June and July. Economists had forecast a 0.1 percent drop for August.
Separately, Eurozone's private sector contracted at a slower pace than estimated earlier in September.
The euro Stoxx 50 index of eurozone bluechip stocks is losing 0.09 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 0.03 percent.
The German DAX is up 0.05 percent and the UK's FTSE 100 is advancing 0.12 percent. The French CAC 40 is falling 0.26 percent and Switzerland's SMI is losing 0.15 percent.
In Frankfurt, Deutsche Bank is gaining 2.5 percent. Commerzbank is advancing 0.5 percent after Berenberg initiated the stock with a "Sell" rating.
RWE is climbing 1.6 percent and ThyssenKrupp is rising 1.5 percent.
Among carmakers, BMW is adding 1.4 percent. Daimler is moderately up while Volkswagen is losing 1.4 percent.
In Paris, Vallourec is declining 1.2 percent. Essilor International is losing 1 percent.
Sanofi is falling 0.7 percent. The drugmaker and U.S.-based peer Bristol-Myers Squibb Co. have restructured their long-term alliance, following the loss of exclusivity for blood thinner Plavix and hypertension drug Avapro/Avalide in many major markets.
Alcatel Lucent is gaining 1.6 percent. Schneider Electric and Unibail-Rodamco are notably higher.
Lenders Credit Agricole, BNP Paribas and Societe Generale are moderately higher.
In London, International Consolidated Airlines and chipmaker ARM Holdings are adding 1.6 percent each.
Glencore, Vedanta and Xstrata are notably higher.
J Sainsbury is moderately up. The company posted increases in sales and like-for-like sales for the second quarter, with strong growth in Non-Food category.
Tesco reported a drop in profit for the first half of the year, amid lukewarm sales growth in tough conditions. The stock is losing 1.3 percent.
Schroders is losing 1.5 percent. UBS cut its rating on the stock.
Lamprell expects full-year loss to be 'significantly greater' than its prior expectations. The stock is plummeting 32 percent.
Firstgroup is plunging 18 percent, following an announcement from the Department for Transport that it has discovered significant technical flaws in the way franchise process for the InterCity West Coast was conducted and have canceled the competition for this franchise.
Across Asia/Pacific, major markets ended mixed. Australia's All Ordinaries and Hong Kong's Hang Seng advanced around 0.2 percent each, while Japan's Nikkei 225 lost 0.5 percent.
In the U.S., futures point to a mixed open on Wall Street. The major averages ended the previous session mixed for the second straight day. While the Nasdaq and the S&P 500 managed to finish the day in positive territory, the Dow posted a slim loss.
In the commodity space, Crude for November delivery is falling $0.73 to $91.16 per barrel while December gold is adding $3.7 to $1779.3 a troy ounce.

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Asian Stocks Mixed On Spain Worries
Asian stocks fell broadly in thin holiday trading on Wednesday, as lingering uncertainty over Spain's bailout and concerns regarding the slowdown in China kept investor mood cautious ahead of Friday's U.S. jobs report.
The Asian Development Bank today slashed its growth forecast for developing Asia, citing gloomier global prospects and weak domestic demand in the region's largest economies. In its Asian Development Outlook 2012 update, the bank cut the region's growth forecast for this year sharply to 6.1 percent from the 6.9 percent estimated in April, but noted that most of the developing Asia economies have room to counteract shocks emanating from the unresolved euro area sovereign debt crisis or a Sharp fiscal contraction in the U.S.
Japanese shares fell for a fourth consecutive session, dragged down by tech shares as traders awaited U.S. employment data and Moody's rating decision on Spain after Prime Minister Mariano Rajoy dismissed speculation that the country is getting close to requesting a euro-zone bailout. The Nikkei average slid half a percent in thin trading.
Tokyo Electron and Advantest fell 3-5 percent on rising concerns over global growth prospects. Pharmaceutical maker Daiichi Sankyo slumped 5.4 percent on news that the company and U.S. drug firm ArQule Inc. will discontinue a late-stage study of their experimental drug to treat lung cancer. Nissan Motor ended down 2.1 percent after shares of its Chinese partner Dongfeng Motor Group fell in Hong Kong amid concerns that movements to boycott Japanese vehicles may gain momentum in China.
Toyota Motor added 0.4 percent after the company led major automakers with the biggest gain in September U.S. sales. Heavyweight Fast Retailing rallied 3.7 percent on a Nikkei report that the retailer is on track to generate record earnings in annual group sales. Japan Petroleum Exploration climbed 5.3 percent on a report the firm has succeeded in trial extraction of shale oil in northern Japan.
Hong Kong's Hang Seng Index edged up 0.2 percent, with weakness in oil majors following gloomy Chinese data capping further upside. The Purchasing Managers Index of China's non-manufacturing sector, a key economic indicator, fell to 53.7 in September from 56.3 in August, with a reading below 50 indicating contraction of the sector, a survey by the China Federation of Logistics and Purchasing showed today. The mainland Chinese market was shut for the Golden Week holidays running from September 30 to October 7. The South Korean share market was also closed for a holiday.
Australian shares pared some early gains after hitting a 14-month high early in the session following the Reserve Bank of Australia's rate decision on Tuesday afternoon. The benchmark S&P/ASX 200 rose 0.13 percent, while the broader All Ordinaries index gained 0.15 percent. Miners gave up early gains going into the close after official figures showed Australia's trade deficit widened in August, with merchandise trade deficit widening to A$2.027 billion in the month compared to an upwardly revised deficit of A$1.530 billion in July.
BHP Billiton eased 0.3 percent and Rio Tinto lost half a percent. Smaller rival Fortescue Metals Group shed 0.6 percent after Standard and Poor's Ratings Services said the company was the most vulnerable iron ore miner in the world to falling commodities prices.
Banks ended mostly higher after yesterday's interest rate cut by the central bank. Westpac ended flat, ANZ rose 0.2 percent and NAB added half a percent, but Commonwealth slipped marginally. APN News & Media tumbled 3.5 percent after the company said it has "nothing to announce at this stage" on the sale of its New Zealand assets.
In economic news, an index measuring the performance of the service sector in Australia came in with a score of 41.9 in September, the Australian Industry Group said - down from 42.4 in August, with a lower reading indicating a faster pace of contraction.
New Zealand shares rose to a fresh four-and-a-half-year high as the prospects of continued low returns on popular savings vehicles encouraged investors to search for better returns. The benchmark NZX-50 index rose half a percent to 3889.60, its highest level since January 10, 2008.
Resins and chemicals maker Nuplex Industries, which offers an attractive dividend yield of 7.4 percent, climbed 5.5 percent, Fletcher Building, the nation's largest construction company, rose 2.5 percent and Warehouse Group, New Zealand's largest listed retailer, added 2.4 percent, while Vector fell 1.4 percent and Auckland International Airport lost 3 percent on going ex-dividend.
Stock exchange operator rose 0.9 percent after data showed the value of trading in NZX debt and equity markets rose 15 percent to $NZ2.6 billion in September from a year earlier.
Elsewhere, key benchmark indexes in Indonesia, Malaysia and Singapore eased marginally and the Taiwan Weighted average shed 0.4 percent, while India's benchmark Sensex was up 0.1 percent, extending a recent rally on continued hopes for further policy reforms in the coming months.
Commodities like copper and oil were subdued and the euro weakened against most of its major counterparts as investors awaited today's ADP employment report from the U.S. which will give investors a heads up on what to expect from Friday's non-farm payrolls report.
U.S. stocks turned in a lackluster performance overnight on renewed uncertainty about the timing of a Spanish bailout after Spanish Prime Minister Mariano Rajoy denied a Reuters report that the nation could request a euro-zone bailout as early as next weekend. The Dow edged down 0.2 percent, while the tech-heavy Nasdaq inched up 0.2 percent and the S&P 500 crept up 0.1 percent.

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Bank Of England Unlikely To Boost QE
The U.K. central bank is set to stick to the current level of quantitative easing and leave its interest rate unchanged at historic low as policymakers are likely to take note of the improvement in the economy.
The Monetary Policy Committee of the Bank of England headed by Governor Mervyn King is widely expected to retain its quantitative easing programme unchanged at GBP 375 billion. The announcement is due on Thursday at 7.00 am ET.
The extension of asset purchases, which was last initiated in July, will continue until early November. Moreover, lending to households has started to show positive signs due to the Funding for Lending Scheme introduced in August.
The bank is likely to expand stimulus next month once they complete the ongoing GBP 50 billion increase.
According to the latest Credit Conditions Survey of the bank, lenders predicted a significant growth in secured credit availability over the fourth quarter citing strength from the Funding for Lending Scheme.
The nine-member committee is also expected to maintain the current 0.50 percent interest rate. The rate stands at the lowest level since the bank was established in 1694. The previous change in the rate was in early 2009. A rate cut would help borrowers, but it will impact income of savers.
IHS Global Insight's Chief U.K. economist Howard Archer said he is sceptical that the BoE will take interest rates down to 0.25 percent given ongoing serious doubts within the MPC that such a move would have a net overall beneficial impact.
Inflation eased to 2.5 percent in August, but continues to remain sticky above the 2 percent target. But, policymakers are more concerned about the risks from slowdown in economic activity.
Official data showed that the British economy contracted 0.4 percent in the second quarter, following a 0.3 percent fall in the first quarter and 0.4 percent drop in the fourth quarter of 2011.
Many economists said the economy is set to have exited a recession in the third quarter. The official ONS assessment that the U.K. was in technical recession for three consecutive quarters is too gloomy, the British Chambers of Commerce said. The lobby expects a return to positive GDP growth in the third quarter.
"It is clear that the economy has been stagnant for too long, and urgent measures are needed to enable businesses to drive a sustainable recovery," the BCC said.