Volatile Week Comes to a Close; Bank Stocks Rally

Word on the Street

• President Obama praised Congress today after House and Senate negotiators reached a dawn agreement on legislation that redefines federal oversight of Wall Street. The new measures must still be approved by the full House and Senate, but leading lawmakers say they expect President Obama will be able to sign the bill into law by July 4.
• Kellogg Co. (K) is recalling about 28 million boxes of cereal due to a packaging-related off-flavor and smell. The recall includes some of the company’s popular brands such as Apple Jacks, Corn Pops, Froot Loops and Honey Smacks products, but chances of serious illness from the smell were low.
• The US Commerce Department lowered its estimate for first-quarter economic growth for the second consecutive month. The nation’s first-quarter gross domestic product increased a modest 2.7 percent; lower than the 3 percent previously estimated.
• Fabrinet, a maker of components for optical communications systems, raised $85 million after reducing its initial public offering price by as much as 29 percent. Morgan Stanley (MS) and Deutsche Bank Securities are joint book-runners for the offering.
• Biopharmaceutical giant Gilead Sciences Inc. (GILD) agreed to acquire privately held drug discovery company CGI Pharmaceuticals Inc to diversify its product lineup. Gilead is paying $120 million for the company, which will mostly be paid up front.
• Consumer Confidence on the Rise – Americans are feeling better about the economy, according to the newly released Reuters/University of Michigan consumer sentiment index. Consumer sentiment rose in June to its highest since January 2008. The index increased to 76.0 in late June, which is up from 73.6 in May.
• Shares of KB Homes (KBH) tumbled to the lowest price in almost a year after the homebuilder reported a sharp drop in new home orders in the three months that ended in May. The builder’s orders plunged 23 percent versus the same quarter last year.

Other Interesting Tidbits

• Where Are The Yes Men? – The problem with government is not that it is full of bad stupid people, but that it takes good smart people and rewards them for inaction.
• How Financial Reform May Affect You and Your Broker
• Can a Vacation Help Boost Your Portfolio? – Research shows time off enhances creative choices. Get on a plane now.
• Are You a Goal-Getter? – 7 steps to achieving your goals
• How a ticket could hurt your credit – Your driving doesn’t have anything to do with your creditworthiness, so why should an unpaid ticket torpedo your credit scores?