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Jul 15, 2013

CNBC Latest Stories - Evening Brief; July 15, 2013.


Egyptian Liberals Embrace the Military, Brooking No Dissent: NYT International Herald Tribune I Global Update ; July 15, 2013

July 15, 2013
Compiled 20:45 GMT

Global Update



Egyptian Liberals Embrace the Military, Brooking No Dissent

Liberal Egyptians have long had an uneasy relationship with the military, but since it pushed out President Mohamed Morsi, a majority have been intolerant of dissenters.

Putin Says U.S. Has Effectively Trapped Snowden

President Vladimir V. Putin said that the United States had frightened other countries that might have accepted Edward J. Snowden.

Chinese Court Ruling Deals a Blow to Labor-Camp System

A $429 award was an acknowledgment that a woman should not have been sent to a labor camp for demanding harsher punishment for some of the men who raped her daughter.

Video: Ex-Trader 'Fabulous Fab' Goes on Trial

Fabrice Tourre, a former Goldman Sachs trader, goes to court Monday to fight accusations that he was part of a conspiracy to dupe investors with a mortgage security that failed in 2007.

Op-Ed Contributor

The Slowing of Two Economic Giants

Will China or India come out ahead? It depends on reform.

Egyptian Leaders Freeze Assets of Morsi Backers

Egypt's new military-led government is increasing pressure on supporters of ousted President Mohamed Morsi to back down from their public protests.

Bangladesh Sentences Former Islamic Party Leader to 90 Years

The former leader of the Jaamat-e-Islami party, which opposed Bangladeshi independence, was convicted of crimes committed during the country's 1971 war.

China's G.D.P. Growth Slows as Government Changes Gears

Analysts said China's notably slower growth in the second quarter of the year demonstrated Beijing's new commitment to overhauling the economy.

Citigroup Profit Climbs 42%

Citigroup beat earnings expectations on Monday as profit swelled in the second quarter as the sprawling bank works to cut its costs and expand its international lending operations.

Trial of Former Goldman Trader Gets Under Way

Five women and four men will hear the three-week civil trial of Fabrice Tourre, the former Goldman Sachs employee who has become a prominent face of the financial crisis.

Attention, Shoppers: Store Is Tracking Your Cell

Using video surveillance, and signals from shoppers' cellphones and apps, retailers are tracking customers' behavior and moods.

In Battle Over Dell, a Founder Hopes to Reclaim His Legacy

Michael Dell wants to take his company private and retool it without quarterly earnings pressure. After Dell missed the shift to mobile, he has his work cut out for him.

N.S.A. Leaks Revive Push in Russia to Control Net

Even before Edward J. Snowden arrived in a Moscow airport, Russia had been pressing for greater access to social networking and e-mail data.

At Tour De France, Default Language Now Is English

Cycling teams with multinational rosters, seeking unity, are adopting English, not French, as their lingua franca.

Top Sprinters Test Positive, Jolting Track World

Three of the biggest sprinters in track and field, including the American Tyson Gay, on Sunday revealed that they had tested positive for banned substances.

Froome Reasserts His Control, and a Young Rival Makes His Mark

With a burst of power on the steep final slopes of Mont Ventoux, Chris Froome sprinted away from Nairo Quintana and gained more than a minute and a half on his two closest rivals.

Prayer, Anger and Protests Greet Verdict in Florida Case

Lawmakers, clergy members and demonstrators described the decision not to convict George Zimmerman on any counts in the death of Trayvon Martin as evidence of endemic racism.
News Analysis

In Zimmerman Case, Self-Defense Was Hard to Topple

George Zimmerman had the power of self-defense laws on his side, and was helped by a spotty police investigation and prosecutorial missteps.

With Criminal Case Closed, Justice Department Will Restart Hate Crime Inquiry

The federal inquiry was started last year shortly after Trayvon Martin was shot by George Zimmerman, but was delayed while the Florida criminal trial was under way.
Op-Ed Columnist

The Bloomberg Legacy

A mayor who was long on vision, though often short on consensus.
Op-Ed Columnist

Hunger Games, U.S.A.

With the farm bill vote in the House, policy turns outright sadistic.

The Future of Same-Sex Marriage

In the wake of two important Supreme Court rulings, the fight for equality continues

Trayvon Martin, the UN strain and paying politicians: The Economist I New Selected Articles; July 15, 2013.

Monday, July 15th 2013
Editor's picks

A selection of new stories from
Democracy in America: Getting away with it
Pomegranate: Change of tack
Charlemagne: Mariano in a muddle
Americas view: The UN strain
Daily chart: Rewarding work

Democracy in America:
Getting away with it
George Zimmerman's acquittal reflects legal protections that, perhaps ironically, keep America's legal system a little less racially unjust
Change of tack
The new emir of Qatar is moving fast to rejig his country's foreign policy
Mariano in a muddle
Will the Spanish prime minister survive the illicit funding scandal of his party?
Americas view:
The UN strain
The UN continues to ignore growing evidence that it brought a deadly illness to the poorest country in the Americas
Daily chart:
Rewarding work
A comparison of lawmakers' pay

Click Here!

U.S. stocks gain, extending record rise: Wall Street at Close Report by MarketWatch; July 15, 2013.

By Kate Gibson, MarketWatch 

NEW YORK (MarketWatch)U.S. stocks climbed modestly on Monday, with the SaP 500 and the Dow industrials rising to record closing highs again, after Citigroup Inc. reported better-than-expected earnings. 

The S&P 500 index SPX +0.14%  climbed 2.31 points, or 0.1%, to 1,682.50, rising for an eighth consecutive session, its longest run higher since an eight-session stretch that ended Jan. 25. It also marked another all-time finish, its 20th so far this year. 

Analysts at Bank of America Merrill Lynch raised their 2013 year-end target for the SaP 500 to 1,750 from 1,600 previously. 

Utilities paced sector gains Monday and telecommunications led the losses in the SaP 500. Citigroup’s C +1.97%  shares rose 2% after the banking giant reported a steep jump in second-quarter profit.
“It’s a big earnings week, but expectations are modest, so it’ll be interesting to see how companies perform with lowered expectations,” said Paul Mangus, head of equity research and strategy at Wells Fargo Private Bank. 

Watch Citi, Leap Wireless, Boeing
Here’s a look at the stocks traders are watching, including Citigroup, Leap Wireless and Boeing. Photo: Getty Images

A better-than-forecast manufacturing report helped neutralize worse-than-anticipated U.S. retail-sales data

“We’re encouraged that the market is focusing on fundamentals again,” said Mangus added.
The Dow Jones Industrial Average DJIA +0.13%  rose 19.96 points, or 0.1%, to 15,484.26, a record closing high — its 26th this year. 

Dow component Boeing Co. BA +3.72%  shares rose 3.7%, regaining a large chunk of Friday’s losses, after British investigators reportedly found no evidence that batteries caused a fire on one of the manufacturer’s 787 planes. Are Boeing shares immune to Dreamliner woes?
The Nasdaq Composite index COMP +0.21%  rose 7.41 points, or 0.2%, to 3,607.49. 

More than 567 million shares traded on the New York Stock Exchange. Composite volume topped 2.57 billion. 

Gold prices rose, with August futures GCQ3 +0.48%  rising 0.5% to end at $1,283.50 an ounce on the Comex division of the New York Mercantile Exchange. The cost of crude also increased, with oil futures CLQ3 +0.43% rising 37 cents to $106.32 a barrel. 

Crude’s spike has been “a fairly quick reaction to geopolitical events, so it may be a blip, only time will tell,” said Mangus at Wells Fargo, referring to recent turmoil in Egypt. 

Economic data boost stock futures
U.S. stock futures gained ground as an upbeat economic report out of China helped put the market on track to extend its run to fresh highs. 

Treasury yields fell, with the yield on the 10-year note 10_YEAR -1.39%  used in determining mortgage rates and other consumer loans at 2.55%. 

The dollar DXY +0.13%  climbed against the currencies of major U.S. trading partners, including the Japanese yen USDJPY +0.47%

U.S. stock-index futures had added slightly to gains after economic reports that had manufacturing in the New York region expanding to a five-month high in July and U.S. retail sales up 0.4% in June, advancing less than forecast.
“The consumer was a bit weaker than expected in the second quarter,” noted Dan Greenhaus, chief global strategist at BTIG LLC, in an email. 

In light of the retail-sales report, “there is a very real possibility second quarter GDP will be less than 1% for the second time in the last three quarters,” Greenhaus said. Read a commentary piece: Is the economy getting close to contraction?

Bloomberg  Image
NYSE floor traders
The economy slowed somewhat in the second quarter relative to year-ago growth, intensifying the importance of corporate guidance as to what’s to come in the next two quarters and 2013, Wells Fargo‘s Mangus said.
Another economic report had U.S. business inventories rising 0.1% in May. 

Both the Dow industrials and the S&P 500 climbed to record closes on Friday following upbeat earnings from two major banks and after Federal Reserve Chairman Ben Bernanke voiced support for continued monetary stimulus. 

Bernanke is scheduled to testify about the U.S. economic and policy outlook before the House Financial Services panel on Wednesday, and before the Senate Banking Committee on Thursday. 

“The interpretation of Mr. Bernanke’s comments will be important. It’s a matter of when, not if,” said Mangus of expectations that the Fed will start cutting back on its $85 billion in monthly bond purchases later this year or early in 2013. 

Shares of Leap Wireless International Inc. LEAP +112.41%  soared after AT&T Inc. T -0.73%  late Friday said it would purchase the provider of prepaid-mobile services for $15 a share, or nearly $1.2 billion. 

Kate Gibson is a reporter for MarketWatch, based in New York.

DealBook P.M. Edition; July 15, 2013: Trial of Former Goldman Trader Gets Under Way

Monday, July 15, 2013
Fabrice P. Tourre, the former Goldman Sachs trader, entered federal court in Lower Manhattan on Monday.
Trial of Former Goldman Trader Gets Under Way Five women and four men will hear the three-week civil trial of Fabrice Tourre, the former Goldman Sachs employee who has become a prominent face of the financial crisis.
For the latest updates, go to »

Dominique Strauss-Kahn, the former director of the International Monetary Fund.
Strauss-Kahn Re-emerges in Finance, in Russia Dominique Strauss-Kahn, the former chief of the International Monetary Fund whose career unraveled in a series of sex scandals, was named a board member of a banking subsidiary of Rosneft.
VMware Sells Zimbra Amid Shift in Strategy VMware is selling Zimbra, a provider of corporate e-mail and collaboration software, to Telligent, which makes social software for businesses.
David Green, director of the Serious Fraud Office in London.
Britain Charges 2 Former Brokers in Libor Inquiry Two former brokers at RP Martin Holdings, Terry J. Farr and James A. Gilmour, were charged with conspiracy to defraud related to an investigation into the manipulation of benchmark interest rates.
Citigroup Profit Climbs 42% Citigroup beat earnings expectations on Monday as profit swelled in the second quarter as the sprawling bank works to cut its costs and expand its international lending operations.
Loblaw to Buy Shoppers Drug Mart in Canada The Loblaw Companies, Canada's largest food retailer, announced on Monday that it would acquire Shoppers Drug Mart, the country's biggest pharmacy chain, for $11.9 billion in cash and stock.
China Insider: Looking Past G.D.P. to the Changes in China Ahead It is now difficult for even the most bullish of China analysts to argue that the economy is not in very difficult straits, says Bill Bishop.
White Collar Watch: Insider Traders Should Be Ready to Do Hard Time Two recent decisions by appeals courts have upheld the discretion of judges to mete out long sentences for insider trading, even if this was not the common practice in similar cases, says Peter J. Henning.
Another View: Public-Private Partnerships Could Be a Lifeline for Cities Municipalities can gain much needed cash and operating efficiency by contracting with private equity investors to run a public service or utility. The investors make a large up-front payment and receive a concession to operate the service, says Kent Rowey.
Breakingviews: Banks Dodge a Bullet With Deal on Swaps Global banks will now have the choice of trading and clearing transatlantic swaps in either Europe or the United States, say Dominic Elliott and George Hay.
Economic Data Data to be released on Tuesday includes the Consumer Price Index and industrial production for June.
Corporate Earnings Companies scheduled to report results on Tuesday include Goldman Sachs, Coca-Cola, Johnson & Johnson and Yahoo.
Overseas On Tuesday, Carlos Ghosn, chief executive of Nissan, will attend a discussion on emerging markets in Chennai, India, as the company reintroduces Datsun as a global brand. Also on Tuesday, Stephen Poloz, the new Bank of Canada governor, will make his first interest rate announcement; he is expected to keep rates unchanged.
For the latest updates, go to »

Quotation of the Day
"Do not assume people know what investment bankers do."
Katherine B. Forrest, the judge at the trial of Fabrice Tourre, instructing lawyers to keep the case simple for jurors.

Stocks finish at fresh highs; S&P 500 posts 8-day winning streak: Wall Street at Close Report by CNBC; July 15, 2013

Stocks finished modestly higher in lackluster trading Monday, with the Dow and S&P 500 closing at new highs for the third-straight session, as investors digested a handful of mixed economic data and ahead this week's slew of earnings reports.
"The second half is underway, and things are already looking encouraging," according to Sam Stovall, chief equity strategist at S&P Capital IQ. "Catalysts for the market's advance, as well as our own optimism, are found in our interpretation of historical precedents, economic projections, fundamental forecasts and technical considerations. So when describing our outlook for the second-half performance of U.S. equities, we borrow liberally from Herman's Hermits: 'Second verse, same as the first.' While we expect the trend to be the same, we think the magnitude of advance will be less, but the volatility will be greater."
Name Price Change %Change
DJIA Dow Jones Industrial Average 15484.26
19.96 0.13%
S&P 500 S&P 500 Index 1682.50
2.31 0.14%
NASDAQ Nasdaq Composite Index 3607.49
7.41 0.21%

The Dow Jones Industrial Average ended modestly higher, led by Boeing. The Dow is within 60 points from its all-time high of 15,542.40 hit on May 22.

The S&P 500 and the Nasdaq also finished slightly higher, posting their eighth-straight rally. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, closed below 14.

Among key S&P sectors, telecoms led the laggards, while utilities edged higher.
Best midsummer mid-caps
The Small Cap Russell 2000 Index is hitting another record high. Which mid-cap stocks are the best? Eric Marshall, Hodges Capital Management, and Brian Macauley, Hennessy Focus Fund, share their picks.
On the economic front, retail sales rose just 0.4 percent in June, according to the Commerce Department, missing expectations for a gain of 0.8 percent. It was still the third straight month of gains in sales and followed a revised 0.5 percent rise in May. Meanwhile, growth in New York state's manufacturing sector accelerated to 9.46 in July from 7.84 in June, according to the New York Federal Reserve. Economists surveyed by Reuters expected a reading of 5. A reading above zero indicates expansion. And U.S. business inventories ticked up 0.1 percent in May, according to the Commerce Department. Economists polled by Reuters had forecast inventories unchanged in May after a previously reported 0.3 percent gain. China's annual economic growth slowed to 7.5 percent in the second quarter of 2013, from 7.7 percent, marking the slowest pace of year-over-year growth since the third quarter of last year. Still, markets cheered the news as many traders expected a figure below 7.5 percent following the recent slew of disappointing trade and manufacturing data from the world's second-largest economy. (Read More: Chinese growth seems a bit too Goldilocks to some) The Shanghai Composite rallied 1 percent on the news, but gains across Asia were capped by light trading volumes, with Japanese markets shut for a public holiday.
Later this week, Federal Reserve chairman Ben Bernanke is expected to be on Capitol Hill for his annual testimony on the economy. Markets got a boost last week after Benrnanke said said monetary policy would remain accommodative for the foreseeable future, even if the unemployment rate hit the Fed's target of 6.5 percent. Stocks rallied sharply last week, with the Dow and S&P finishing at fresh highs. The S&P and Nasdaq posted their second best weekly gains this year. Among earnings, Citigroup rose after the financial giant delivered another positive surprise in the banking sector, posting profit of $1.25 per share against estimates of $1.17. Banks were expected to be the best sector amid an otherwise lackluster quarter. Other financials slated to post quarterly results this week include Goldman Sachs, Bank of America and Morgan Stanley. Additionally, tech giants including Google, Microsoft, Intel, IBM and Yahoo are also scheduled to report throughout the week. Analysts surveyed by Thomson Reuters expect S&P 500 companies' second-quarter earnings to have grown 2.8 percent from a year earlier, with revenue up 1.5 percent. (Read More: Bob Doll: Only strong earnings can keep rally going) Leap Wireless skyrocketed nearly 120 percent following news the provider agreed to be acquired by AT&T for $15 per share in cash, or about $1.2 billion. The deal represents an 88 percent premium to Friday's close. Solar stocks including First Solar, Suntech Power and LDK Solar soared after China boosted its 2015 target for soclar power capacity by more htan 60 percent. Also, Boeing recovered after investigators determined the Friday fire on a 787 Dreamliner at Heathrow Airport was not caused by a battery issue. Meanwhile, Honeywell it was invited by UK investigators to participate in the probe of the Dreamliner fire. Separately, a source with knowledge of the investigation told Reuters that the emergency locator transmitter was being looked at for possible involvement in the fire. Honeywell makes the device for the 787. Alexion Pharmaceuticals rose on a Reuters report that Switzerland's Roche is seeking financing for a possible Alexion bid.
—By CNBC's JeeYeon Park (Follow JeeYeon on Twitter: