Investors Stage a Small Recovery; Dow and S&P Rise

Word on the Street

• On the heels of Chrysler issuing a recall, General Motor announced that it will be recalling 1.5 million cars and trucks from the 2006 to 2009 model years because their heated washer-fluid system could short circuit and cause a fire.
• Viktor Orban, the Hungarian prime minister unveiled an economic action plan that includes tax cuts and pay reductions. Orban said a new 29-point fiscal plan will introduce a six-year tax for financial institutions and reduce red tape for investors. He also suggested it would cut public sector wages and eliminate benefits such as free cars and cell phones.
• There were more job openings in April but employers didn’t rush to fill them. The United States had 3.1 million job openings on the last business day of April 2010, up about 34.8 percent from July of 2009. The rate of hires, measured as a percentage of the total number of people employed, remained unchanged in April at March’s two-year high of 3.3 percent.
• Talbots 1Q Loss Narrows – Talbots Inc. (TLB) posted lower-than-expected sales as tight inventories failed to keep up with demand, and the women’s clothing retailer gave a disappointing forecast for the current quarter.
• Shared of Pep Boys (PBY) traded lower today after the company announced its Q1 2010 earnings this morning before the market opened. Same-stores sales weakened in the final month of its first quarter, keeping revenue below expectations.
• McDonald’s Continues to Outpace the Rest of the Economy – Earlier today McDonald’s Corporation (MCD) announced comparable-store sales rose 4.8% in May. Same-store sales in the US came up 3.4%, 5.7% in Europe and 3.8% in Asia, the Middle East and Africa. Analysts had projected an increase of 4.5%. There are three reasons for the McDonald’s gains: cheap meals, beverages and global expansion.
• The latest survey from J.D. Power showed that overall satisfaction among airline travelers is recovering. Overall satisfaction hit a three-year high of 673 on a 1,000-point scale, up 15 points from 2009. That score is calculated using survey data on fees, flight crew, in-flight services, aircraft quality, baggage handling and other factors.

Other Interesting Tidbits

• The Bad News – Five reasons the employment numbers are worse than they seem.
• Four Big Businesses Built With Small Cash – These four entrepreneurs built multimillion-dollar companies with as little as $100. Find out who they are and how they did it.
• 4 Things to know about 529 Plan Withdrawals – The full story is pretty complicated. Here’s what you need to know.
• 9 Credit Score Myths, Debunked – Hint: You have more than one score, and your income has no effect on it.
• 5 Alternatives to Traditional Retirement – Career breaks may change your feelings about work and retirement.