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| Weekly Wrap Up |
The markets stumbled backwards a bit on Monday after the Commerce Department's new home sales report failed to inspire confidence in investors. Verizon (VZ: Charts, News, Offers) beat out Wall Street expectations for the quarter, but posted a 21% decline in profits. Aetna and Honeywell also added to the bad news with sub-par quarter performances. Monday's market negativity carried over into Tuesday as numerous corporate giants such as Viacom (VIA: Charts, News, Offers), Valero (VLO: Charts, News, Offers), Office Depot (ODP: Charts, News, Offers), and Hitachi (HIT: Charts, News, Offers) posted quarter losses . Even Bank of America (BAC: Charts, News, Offers) announced that it will be closing 10% of its branches. Stocks dipped even lower on Wednesday after the Commerce Department's disappointing durable goods report. Despite the Microsoft (MSFT: Charts, News, Offers) and Yahoo (YHOO: Charts, News, Offers) deal and the beige books optimistic outlook on the economy, the markets were unable to climb out of the red. In corporate news, Sprint Nextel (S: Charts, News, Offers) bought Virgin Mobile USA for $483M, and Qwest Communications (Q: Charts, News, Offers) bested street expectations but still posted an overall loss. The markets recovered on Thursday from the week's earlier slide. General Electric (GE: Charts, News, Offers) led the rally charge as its shares shot up 8.7% after Barney Frank commented that manufacturers already owning finance businesses should be allowed to keep the units under the revised banking rules. Adding to the day's promising outlook was a surprisingly smooth and optimistic seven-year Treasury note auction. The week concluded with mixed results on Friday. Investors' response to the government's GDP report was relatively positive and speculation that the "cash for clunkers" program will receive additional funding seemed to be welcomed news. However, Walt Disney (DIS: Charts, News, Offers) was forced to lower its quarterly profit and Chevron (CVX: Charts, News, Offers) saw its quarter income drop 71% despite posting a $1.75 billion gain. U.S. light crude oil rose $2.39 to $69.33 a barrel for September on the New York Stock Exchange. The dollar also slumped to the lowest level of the year on Friday. More Market News
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| Economic News |
First-time unemployment claims creep up in latest week
First-time claims for state jobless benefits crept up in the latest week, the Labor Department reported Thursday, but the trend of initial claims fell and fewer people were continuing to collect unemployment checks. Initial weekly jobless claims rose by 25,000 to a seasonally adjusted 584,000 during the week ended July 25, about in line with economists' expectations. (Source: MarketWatch) Click here to read the full article
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Oil settles below $68
Oil prices fell Tuesday after data showing a drop in U.S. consumer confidence spurred concerns about the economy and sent investors into safer havens. An index of U.S. consumer confidence dropped to 46.6 in July from 49.3 in June, below analyst expectations of 49.0, recording its second consecutive decline as sentiment remained hampered by a difficult job market. (Source: CNN Money) Click here to read the full article
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Fed's Economic Snapshot Brings Street Off Lows
Stocks remained under pressure in New York Wednesday afternoon as investors weighed a disappointing government report on factory orders against confirmation from the Federal Reserve that the economy is stabilizing, but the major averages came off their lows in the final hour of trading. The Fed's beige book, a snapshot of economic conditions across the central bank's 12 districts, found that the pace of decline has moderated despite continued slowness in retail activity and extremely soft labor markets. (Source: Forbes) Click here to read the full article
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Oil prices retreat amid drop in consumer confidence
Crude oil prices retreated July 28- only the second time in the past 10 trading sessions- amid a lower-than-expected consumer confidence reading, reported analysts at Pritchard Capital Partners LLC in New Orleans. The New York-based Conference Board said its Consumer Confidence Index fell to 46.6 in July, down from 49.3 in June (OGJ Online, July 28, 2009). Also contributing to market weakness on July 28, Pritchard Captial analysts said, were comments by the US Commodity Futures Trading Commission regarding imposing position limits on commodities speculators. They said, "However, CFTC data indicates that speculators have cut long positions in crude by 97% in 2009—implying that the recovery in oil is being driven by fundamentals." (Source: PennEnergy) Click here to read the full article
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| Business News |
Google's $726 Million Writedown On AOL Is More Painful For Time Warner
In its earnings report and conference call with investors, Google (GOOG: Charts, News, Offers) boasted of its Q4 performance and essentially pinned the blame for its first-ever profit decline on $1.09 billion on writedowns related to AOL and Clearwire. In the case of Google and AOL, the search giant took a $726 million impairment charge on the $1 billion investment it made in the Time Warner unit back in 2005. (Source: Washington Post) Click here to read the full article
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Office Depot loss widens, stock plunges 20 percent
Office Depot Inc. (ODP: Charts, News, Offers) reported a bigger-than-expected quarterly loss and warned of a "modest" loss in earnings before interest and tax in the second half of 2009 as the recession weighs on sales at the No. 2 U.S. office supplies retailer. The lackluster results dragged its stock down as much as 20 percent, making it one of the top percentage losers on the New York Stock Exchange. The results also weighed on shares of rivals OfficeMax Inc and industry leader Staples Inc. (Source: Reuters) Click here to read the full article
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Washington Post moves to profit; Kaplan revenue up 13%
Washington Post Co. (WPO: Charts, News, Offers) said Friday that it swung to a second-quarter profit against a prior-year quarter that included significant restructuring charges, as revenue topped most analyst expectations on on growth at its education and cable operations. (Source: MarketWatch) Click here to read the full article
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| Technology Focus |
Sprint Expands Pre-Paid Ops With Virgin Mobile Buy
Sprint Nextel Corp. (S: Charts, News, Offers) doubled down on the fast-growing but highly competitive pre-paid mobile phone market with a $483 million acquisition of Virgin Mobile USA Inc. The Overland Park, Kan., wireless company struggles to keep its more lucrative contract subscribers, and has turned to its Boost Mobile unit, which provides a cheaper service without contracts, to shore up defections. In buying one of its resellers, Sprint gains a well-known pay-as-you-go option that rounds out its low-end offering. (Source: Wall Steet Journal) Click here to read the full article
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IBM to buy SAS competitor SPSS for $1.2B
IBM (IBM: Charts, News, Offers) said Tuesday that it would buy Chicago-based company SPSS in a $1.2 billion deal designed to bolster Blue Blue's offerings in business intelligence software - the space where Cary-based SAS Institute has made its fortune. Specifically, IBM is looking to serve corporate clients that want to use data to predict future trends and spot consumer patterns and behaviors. This process of using data to make better business decisions is called predictive analytics, the area of expertise that SPSS will bring to IBM and an area of particular emphasis at SAS, an SPSS competitor. (Source: BizJournals) Click here to read the full article
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The Motorola Waiting Game
For the past year, covering Motorola (MOT: Charts, News, Offers) has been a waiting game. Details on several of the company's most important initiatives, including its new smart phones and the planned spin-off of its handset business, have yet to be disclosed. Co-chief executive Sanjay Jha, who joined Motorola from Qualcomm last August, has assiduously avoided the limelight along with fellow co-CEO Greg Brown. Many analysts who cover the company haven't published fresh research since April or May. (Source: Forbes) Click here to read the full article
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