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| Weekly Wrap Up |
The markets climbed higher into positive territory this week. The Dow Jones jumped up 30.97 points to 9,995.91 while the Nasdaq added 17.52 points to close at 2,156.80. The S&P 500 also gained 16.19 points and finished the week at 1,087.68. Monday was a relatively slow day for the markets. The Dow Jones and S&P 500 managed to close slightly higher for the session while the Nasdaq just barely dipped into negative territory. The tech sector saw some steep declines with its blue chip performers, particularly Cisco (CSCO: Charts, News, Offers), Hewlett-Packard (HPQ: Charts, News, Offers), and Dell (DELL: Charts, News, Offers). For the most part, stocks retreated into the red on Tuesday. Only the Nasdaq managed to gain any positive momentum as it erased Monday’s point drop. Health care stocks took hit after the Senate Finance Committee announced its approval of an $829 billion plan to revamp the US health care system. However, Domino's Pizza (DPZ: Charts, News, Offers) gave investors something to cheer about. The pizza delivery chain reported a 77 percent increase in profits for the quarter due to extensive cost cutting efforts. Wednesday marked a triumphant time for the Dow Jones as it surpassed the 10,000 point ceiling for the first time in over a year. Intel (INTC: Charts, News, Offers) did its part in driving the Nasdaq over the 10,000 point hurdle with its better-than-expected third-quarter profit numbers. The markets continued to climbed throughout Thursday’s trading. Citigroup (C: Charts, News, Offers) and Goldman Sachs (GS: Charts, News, Offers) both beat out Wall Street expectations with their earnings reports. Unfortunately, Southwest Airlines (LUV: Charts, News, Offers) did not fare as well. The airline posted a $16 million loss for the third-quarter. The market’s mid-week momentum was eventually halted on Friday. General Electric (GE: Charts, News, Offers) and Bank of America (BAC: Charts, News, Offers) posted lackluster quarter reports which seemed to temper market trading. Mattel (MAT: Charts, News, Offers) also added to the bad news. The largest toy maker reported a 3.5 percent dip in third quarter profits due to declining sales from its cash cow toy, Barbie. Despite Friday’s drop off in performance, the Dow, Nasdaq, and S&P 500 all finished the week in positive territory. The November delivery closed at $78.53 per barrel this week, resulting in a $6.76 increase. The price of gold settled at $1050.70 for the week. More Market News
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| Economic News |
Recession May Be Over, but Recovery is Painful
Survey of top economists by National Association of Business Economics finds more than 80% believe the worst is over, but recovery will be slow and painful. More than 80% of top economists believe that the recession that started almost two years ago is finally over. But most don't expect meaningful improvement in jobs, credit or housing for months to come.That's according to a survey released Monday by the National Association for Business Economics (NABE). The group asked 43 top economists last month if they believe the battered U.S. economy has pulled out of the worst U.S. downturn since World War II. Those surveyed include economists from leading Wall Street firms and major corporations, as well as from highly respected universities and research firms. (Source: CNN Money) Click here to read the full article
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U.S. Economy: Retail Sales Fall Less Than Forecast
Sales at U.S. retailers fell less than forecast in September after the Obama administration's cash-for-clunkers program expired, signaling consumers are gaining confidence in the outlook for an economic recovery. The 1.5 percent decrease followed a 2.2 percent gain the prior month, figures from the Commerce Department showed today in Washington. Sales excluding automobiles climbed 0.5 percent, more than projected. Gains in prices of goods imported into the U.S. slowed last month, a separate report showed. (Source: Bloomberg) Click here to read the full article
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Tepid Consumer Sentiment Remains Hurdle for Economy
It was a pretty good week for the U.S. economy: initial reports on third quarter corporate earnings were mostly satisfactory, jobless claims continued to decline, and factory production increased. One metric that underperformed, however, was consumer sentiment, which fell unexpectedly. The Reuters/University of Michigan Surveys of Consumers said its consumer sentiment index for October (preliminary) fell to 69.4 from 73.5 in September, Reuters reported Friday. The index was at 65.7 in August. The index hit a cycle low of 55.3 in November 2008; its record low of 51.7 was set in May 1980. (Source: DailyFinance) Click here to read the full article
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| Business News |
More Troubles At KB Home
Big builder KB Home (KBH: Charts, News, Offers) revealed in a Securities Exchange Commission filing that the federal regulator is examining the company's accounting. The stock fell about 6% today. The filing doesn’t offer much information. A spokesperson says: "KB Home strives to operate its business with the utmost transparency and integrity, and in accordance with generally accepted accounting principles. While the SEC has not specified the subject matter and we cannot speculate on it at this time, we understand that part of the SEC's mandate is to conduct these sorts of investigations, which it has done with hundreds of public companies over the past few years."
KB is still dealing with the legal fallout of some of its previous business practices. In 2006, then ceo Bruce Karatz resigned in a scandal involving the back dating of stock options. He later paid $7 million to settle charges with the SEC, but the company is still wrestling with shareholder suits regarding the matter. In 2005, KB paid $3.2 million to settle complaints its mortgage unit was qualifying buyers for government loans who didn’t meet the criteria. (Source: Businessweek) Click here to read the full article
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Ads Drive Google's Profit Way Up
Google Inc. (GOOG: Charts, News, Offers) reported third-quarter results that easily topped expectations on Thursday, the second straight period of gains for the online search titan and a clear sign that Internet advertising is bouncing back from the depths of the recession. As the dominant Internet player, the Mountain View company's performance is widely viewed as a gauge of the online industry's overall strength. "We believe the worst of the recession is behind us," said Eric Schmidt, the company's chief executive, during an investor conference call. "We're very optimistic now about the future. We now have the business confidence to invest heavily in the next phase of innovation, hoping to invent the future as we see it." (Source: San Francisco Chronicle) Click here to read the full article
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Nokia Q3 Earnings Drop
It held its global lead in the handset market, but problems in the Nokia Siemens Networks unit hurt the company's latest earnings report. Nokia (NOK: Charts, News, Offers) reported a surprise third quarter loss of $836 million Thursday, traced primarily to a big write-off in its Nokia Siemens Networks unit. In addition Nokia reported declining sales of its mobile phones. The surprise size of the loss sent Nokia's shares tumbling 10% in early stock market trading. There was some faint good news, however, as Nokia said it maintained its handset market share lead with 38% share of the global market. Nokia reported revenues of $14.7 billion, a drop from the $18.2 billion reported in the previous quarter. The Nokia Siemens Networks unit recorded a $1.36 billion loss in the recent quarter. (Source: Information Week) Click here to read the full article
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| Technology Focus |
YouTube Monetizing Over A Billion Video Views A Week
YouTube is on the path to profitability in the "not-too-distant future," Google reiterated today during its third quarter earnings call. And while that may sounds all well and good, they actually had some more specific impressive numbers to back it up. One is that YouTube is now monetizing over a billion video views a week. Last week, YouTube announced that it was serving over 1 billion video views a day, so if you do the math there, it means that YouTube is monetizing one every seven video views.
The company also noted that 90% of the top 50 advertisers according to AdAge have now run ads on YouTube. And of its homepage ad inventory, 90% of it sold out for the quarter in the U.S., with lower, but still impressive sale rates for the rest of the world. Google also noted that YouTube was just starting to unleash its pre-roll inventory and let its salesforce have a go at selling that to advertisers, which should bring in more money. (Source: TechCrunch) Click here to read the full article
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Nokia, AT&T Offer $299 Booklet 3G
AT&T will subsidize the cost of the mini-laptop for users who sign up for a two-year data contract; without a commitment the price is $599. AT&T (T: Charts, News, Offers) is partnering with mobile phone giant Nokia (NOK: Charts, News, Offers) on its venture into laptops. Mobile professionals will be able to purchase Nokia's Booklet 3G for $299 with a two-year mobile data plan commitment. The Booklet 3G will be available exclusively in Best Buy (BBY: Charts, News, Offers) stores throughout the holiday retail season, and users will be able to buy the mini-laptop without a data commitment for $599. The Booklet 3G is powered by the Intel (INTC: Charts, News, Offers) Atom processor, has a chassis made from a single piece of aluminum, and will run its operating system is Microsoft (MSFT: Charts, News, Offers) Windows 7. (Source: Information Week) Click here to read the full article
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AMD Shares Fall on Weaker 4Q Revenue Outlook
Shares of chip maker Advanced Micro Devices Inc.(AMD: Charts, News, Offers) fell Friday after paring its revenue outlook for the fourth quarter. Sunnyvale, Calif.-based AMD said it expects revenue to increase by 5 to 7 percent in the quarter from the third quarter. It typically sees a 9 percent sequential increase. AMD disclosed the forecast during its third-quarter earnings report Thursday. The company posted a loss of $128 million, or 18 cents per share, smaller than its year-ago loss. Operating income increased to $76 million from $48 million last year. Revenue fell 22 percent to $1.4 billion but still beat analysts' expectations, driven by a strong back-to-school season. (Source: Forbes) Click here to read the full article
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Cisco Bid Snubbed by Large Tandberg Shareholder
Investors holding 24 percent of shares in videoconferencing group Tandberg snubbed a $3 billion bid from Cisco Systems (CSCO: Charts, News, Offers), raising prospects of a higher offer from the U.S. network equipment maker. "We think the price is too low," said Amund Lunde, chief executive of life insurance group Oslo Pensjonsforsikring, a shareholder with 1 percent of Tandberg's stock and among the group of shareholders that have turned Cisco down. He declined to suggest a price the group might accept. Cisco, which needs acceptances from holders of at least 90 percent of Tandberg stock to fully acquire the company, made its 153.50 crowns per share move for the Norwegian company in October in a bid to dominate the fast-growing corporate video communications market. (Source: CNBC) Click here to read the full article
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| Trivia Question |
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In 1987, American Airlines saved $40,000 by eliminating what?
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| Market Overview |
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| DJIA |
9,995.91 |
+130.97 |
| S&P |
1,087.68 |
+16.19 |
| NYSE |
7,133.96 |
+118.42 |
| NASDAQ |
2,156.8 |
+17.52 |
| 10Yr |
3.,417% |
+0.032 |
| Dollar |
75.576 |
-0.77 |
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| October 16, 2009 |
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| Trivia Answer |
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| One olive from each salad served in first class. |
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