Friday, October 9, 2009

Friday morning

Stocks opened down slightly this morning after the US trade deficit declined 3.5%, versus expectations of a 3.3% rise. The DJIA is off about 11points in the first few minutes. German shares are among the worst overseas, down half a percent.

Well things are going well at least somewhere in North America...
Employment rose by 30,600, Statistics Canada said today in Ottawa. The jobless rate fell to 8.4 percent from August’s 8.7 percent. The median forecast of economists surveyed by Bloomberg was for a 5,000 gain in jobs and unemployment at 8.8 percent.

In the fight of his career, Henry Kravis attempts to preserve value in the TXU buyout.
Billionaire Henry Kravis' plan to save the largest buyout in history is meeting serious opposition from key bondholders, including mutual fund giant Franklin Templeton Investments, sources told The Post. Franklin Templeton is part of a group of lenders that hold more than half the bonds in Energy Future Holdings, formerly known as TXU. Earlier this week they rejected a plan by Kravis' firm, Kohlberg Kravis Roberts & Co., and fellow private-equity giant TPG to restructure EFH's $44 billion debt load.

NYTimes expecting bank Q3 earnings reports to show investors' the bank's earnings power in "calm" times.

At least one firm says that inventories have fallen far enough that companies must increase factory output, boosting economic growth.
Companies will need to re-stock inventories that were depleted more than necessary as consumer spending increases, boosting prices and helping employment recover in the world’s largest economy, said ASR, founded in 2006 by former Merrill Lynch & Co. and UBS AG strategists. Alcoa Inc. said this week in its earnings report that the replenishment of falling customer stockpiles will boost aluminum production.

End of the "golden era" in defense spending may hit Boeing particularly hard.
WASHINGTON — As Senator John McCain argued recently in a floor debate to strip $2.5 billion worth of cargo planes from a military spending bill, he complained that members of Congress could not “walk through these hallways without bumping into a lobbyist from Boeing.”

Scolded for bearishness in the good times, some analysts headed out to start their own firms.
Oct. 9 (Bloomberg) -- When Credit Suisse Group analyst Ivy Zelman refused to turn bullish on homebuilding stocks during a rally in the fourth quarter of 2006, the blowback was intense.
She says investors told her that some housing industry executives were ridiculing her analysis as a “jihad,” and several of the bank’s sales representatives pressed her to upgrade “hold” ratings to “buys” on companies to appease bullish institutional-investor clients. One sales manager even sent her an e-mail warning that analysts who stayed bearish too long often lost their jobs.

Monsanto says Africa will be a major market for their genetically-modified crops. Uh-huh, so until then just buy it's inflated stock and wait for earnings to catch up...
Farming in developing countries needs $83 billion of annual investment for production to feed the world in 2050, the United Nations’ Food and Agriculture Organization said in a paper this week. Monsanto is introducing new modified seeds to boost yields as part of a plan to double gross profit from 2007 to 2012. Africa is affected by climate change as more than 95 percent of sub-Sahara cropland is rain-fed, DiNicola said in Tokyo.

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