Financial News and Notes 10/2/11 – 10/8/11

Economy 

-Japanese business sentiment moved into positive territory for the first time since the disasters in March.  10/3

-In August construction spending ticked up 1.4% from July.  10/4

-Auto sales jumped 10% in September.  10/4

-Manufacturing slowed around the world in September, a worrisome sign for a struggling global economy.  The U.S. manufacturing level rose slightly, but new orders were contracting casting doubt on future growth.  10/4

-Factory orders in the U.S. fell in August after rising in July.  10/5

-Fed chairman Bernanke reiterated that the U.S. economy was perilously close to recession and the government needed to do more to help as he testified before congress.  10/5

-Payroll processor ADP announced that private sector higher rose by 91,000 in September ahead of estimates.  10/6

-The rate of home ownership of homes in the U.S. fell1.1% to 65.1%, the largest drop since the Great Depression.   Meanwhile the 30 year mortgage rate hit its lowest average ever of 3.94%.  10/7

-In September employers added 103K jobs toping estimates and stemming fears of another recession. Job numbers from August were also revised higher by 57K.  The unemployment rate remained at 9.1% However, the economy remains in neutral.  10/8

Corporate

-UBS announced it expected to post a quarterly profit despite the $2billion loss by a trader last month.  10/5

-Apple disappointed many with the unveiling of not the iPhone 5, but an updated version of the iPhone 4.  10/5

-Apple co-founder and tech visionary Steve Jobs passed away.  10/6

-Samsung said it expected its third quarter earnings to be weaker due to decreasing demand for flat panels and computer chips.  10/7

-Apple has said it has received more than 200K preorders for the iPhone 4s in the first 12 hours of its availability.  10/8

-Sprint announced that it would need to either tap its credit line or access the capital markets in order to raise funds.  10/8

Regulatory

-Obama is expected to send trade agreements with Columbia, South Korea and Panama to congress this week.  The deals could potentially be a boon to US corporations increasing exports by $13 billion. 10/3

-BNY Mellon received civil suits from New York and the Justice Department seeking $2 billion in damages regarding their foreign currency exchange transactions, alleging the firm overcharged clients for the transactions.  10/5

Market

-Greece acknowledged over the weekend that they would be unable to hit their budget reduction targets for 2011 throwing additional bailout funds in to jeopardy.  10/3

-Global equity markets got off to a weak start in the 4th quarter.  Fears of slowing global economic growth and a Greek debt default triggering another global recession continue to dominate investors’ moves.  Many major indices are approaching bear market levels.  The Dow fell 2.4% leaving it down 16.8% for its April high.  The S&P 500 is down 19.4% since April.  Both are at their lowest levels in over a year.  In Europe stocks were down 1.1% and Japan saw stocks down 1.8%.  The 10 year treasury yield fell again to 1.787%.  10/4

-Moody’s downgraded Italy’s debt rating to A2 and said an additional drop in credit status was possible in the near term.  10/5

-Stocks finished up for the second day in a row.  The Dow rose 1.2% to 10,940, the S&P grew 1.8%, and Europe was up 3.1%.  The rise was on investor optimism for Europe debt talks, and some positive signs from the U.S. economy.  10/6

-US markets were down on Friday but ended the week up.  The Dow was up 1.7%, the S&P 500 was up 2.1%, Europe was up 2.6%.  The 10 year treasury yield rose back above 2% to 2.067%.

-Fitch lowered its ratings for Italy and Spain. 10/8

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