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| Weekly Wrap Up |
The markets ended last week optimistically as oil prices staggered amid the Russian-Georgian conflict then dropped as the dollar grew stronger. Regarding the broader market indices, the Dow Jones Industrial Average increased by 408 from last week while the New York Stock Exchange increased 81.17 from the week prior. The NASDAQ followed suit to increase overall by 103.14. As for this upcoming week, attention is directed towards the retail sector to see how much consumer spending amounted to from July. Even if the retail sector reports positive earnings, there is no denying that oil prices are still nipping at the potential for retail growth. Still, analysts at Thomson Financial expect such retailers like Wal-Mart (WMT: Charts, News, Offers), Abercrombie & Fitch (ANF: Charts, News, Offers), and Fossil Inc. (FOSL: Charts, News, Offers), to expect quarterly profits to rise in excess of 8%. Retailers such as Kohl’s (KSS: Charts, News, Offers), JCPenny’s (JCP: Charts, News, Offers), and Nordstrom (JWN: Charts, News, Offers) expect profits to decline relative to last year. Economists also point out contrary to analysts' upbeat outlook for the week that IRS stimulus checks have been mailed and spent already, paving the way for a third quarter decline. On the other hand, analysts claim that the recent performance of the dollar is because the dollar has already bottomed out. True or not, the dollar did rise to a six-month high against multiple currencies last week. Another tell-tale sign was when gold declined below $870 this past week, almost reaching as low as $850. More Market News
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| Economic News |
Oil prices plunged in a massive selloff Monday, falling below $120 a barrel for the first time since early May after Tropical Storm Edouard appeared unlikely to threaten oil and natural gas facilities in the Gulf of Mexico. Also weighing on prices was a report by the Commerce Department that consumer spending fell in June as shoppers dealt with higher prices for gasoline, food and other items. That fed investors' beliefs that a U.S. economic slowdown is forcing Americans to cut back on energy use. (source: Yahoo! Finance) Full Story
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Personal income rose slightly in June after surging the previous month on the first wave of economic stimulus checks, the government reported Monday. The Commerce Department said individual income increased by 0.1% in June after a revised 1.8% jump in May. Economists polled by Briefing.com were expecting a 0.1% decrease in June. Personal spending in June increased by 0.6%, which was more than the 0.5% increase that economists polled expected. However, the spending jump was driven by inflation. Individual spending, when adjusted for inflation, actually fell by 0.2% following a 0.3% increase in May, according to the report. (source: CNN Money) Full Story
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The Federal Reserve held its key interest-rate target steady Tuesday, indicating that the central bank's decision to support economic growth with a 2% target, rather than thwart inflation with rate hikes, has gone according to plan. The Federal Open Market Committee noted that the job, credit and housing markets remain under stress and that high energy prices threaten to put pressure on future economic growth. However, it reiterated its position that the economy will stay afloat with the initiatives already put in place. "Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth," the FOMC said in a statement. (Source: TheStreet) Full Story
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| Business News |
Freddie Mac (FRE: Charts, News, Offers) on Wednesday posted its fourth straight quarterly loss as it braced for a prolonged housing crisis by setting aside twice as much money for bad loans and plans to slash its dividend by at least 80 percent. The worse-than-expected results came just three weeks after authorities orchestrated a sweeping effort to prop up the U.S. No. 2 provider of residential mortgage funding and its rival Fannie Mae (FNM: Charts, News, Offers). Freddie Mac's chief financial officer Buddy Piszel reiterated that the company's has adequate capital, and said the company can wait for "choppy" market conditions to improve before raising capital, which could exceed $5.5 billion. For the second quarter, McLean, Virginia-based Freddie posted a loss of $821 million, or $1.63 per share, compared with a profit of $729 million, or 96 cents per share, in the same quarter a year earlier. (Source: Reuters) Full Story
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American International Group Inc. (AIG: Charts, News, Offers) said Wednesday that it lost more than $5 billion in the second quarter, as struggling credit markets stripped several billions of dollars in value from its credit default swaps portfolio and other investments. The world's largest insurer lost $5.36 billion in the April-to-June period, or $2.06 per share. In the same period last year the company earned $4.28 billion, or $1.64 per share. After excluding one-time items, the loss per share came to 51 cents -- much worse than the 63-cent gain that analysts were anticipating. Shares of AIG fell more than 7% in after-hours trading, having fallen 80 cents, or 2.7%, to close Wednesday at $29.09. (Source: CNN Money) Full Story
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With each successive month the plight of Detroit’s Big Three manufacturers--General Motors (GM: Charts, News, Offers), Ford (F: Charts, News, Offers) and Chrysler (DCX: Charts, News, Offers)--becomes a little more desperate and their eventual fate less certain. July’s figures for light-vehicle sales in America, released last week, were unremittingly awful. Seasonally adjusted and annualised, sales fell to 12.5m from 15.3m last year. As in previous months, sales of pickups and sport-utility vehicles (SUVs), down by 31% year on year, were worst hit. But even car sales, hampered by supply shortages of the fuel-sipping compact models Americans now suddenly want, fell by 7.4%. (source: Economist) Full Story
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| Technology Focus |
Cisco Systems' (CSCO: Charts, News, Offers) quarterly earnings just beat analysts' expectations, suggesting that companies didn't skimp too much on network equipment spending despite an economic downturn that has forced businesses to aggressively cut costs. The company, which makes switches and routers that manage Internet traffic, said demand for network equipment helped lift net earnings by 5.3% to $2.0 billion, or 33 cents a share, from $1.9 billion, or 31 cents a share. Adjusted earnings were 40 cents a share, surpassing analysts' estimate by 1 cent. Sales rose 9.9% to $10.4 billion from $9.4 billion a year ago and beat analysts' expectations for sales of $10.3 billion. (Source: Forbes.com) Full Story
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Sony Corp (SNE: Charts, News, Offers) has agreed to purchase Bertelsmann's 50 percent stake in their Sony BMG music joint venture for around $900 million, ending a four-year venture that never lived up to its promise. Sony said in a statement on Tuesday that Bertelsmann will also get $300 million of the cash on Sony BMG's balance sheet, valuing the deal at around $1.2 billion. The music company -- the world's scond-largest after Vivendi unit Universal -- will now be called Sony Music Entertainment Inc (SMEI) and become a wholly owned subsidiary of Sony Corporation of America. Recording artists at SMEI will include Celine Dion, Alicia Keys, Bruce Springsteen, Justin Timberlake, Usher and Jay Chou. (Source: Reuters) Full Story
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Sprint Nextel Corp. (S: Charts, News, Offers) rose 6.1 percent in New York trading on speculation that the mobile-phone company canceled a $3 billion private placement of convertible preferred stock. Sprint, the third-biggest U.S. wireless carrier, said yesterday that it planned to use some proceeds from the offering to pay down debt. CNBC's David Faber reported today that it has been canceled, without saying where he got the information. Sprint spokesman James Fisher didn't return messages. Chief Executive Officer Dan Hesse has attempted to cut debt after losing more than $30 billion in the past year, mainly from writedowns on the 2005 purchase of Nextel Communications Inc. The carrier has lost more than 3.5 million contract subscribers since 2006 to larger AT&T Inc. (T: Charts, News, Offers) and Verizon Wireless (VZ: Charts, News, Offers). (source: Bloomberg) Full Story
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| Your Money |
Is financial sanity a recipe for disaster? We're so addicted to debt that a return to sensible behavior would send the economy into a tailspin of bankruptcies and layoffs. Would it be worth the trouble? Eventually, yes. We personal-finance types constantly nag readers about spending too much and saving too little. But what would happen if everybody suddenly took our advice? What if every household in America: (source: MSN Money) Full Story
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Which organization was the forerunner of the UNO ?
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| The League of Nations, which came into existence in 1920 |
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