Financial News and Notes 12/4/11 – 12/10/11

Economy

-The service sector cooled in November although it is still expanding.  12/6

-U.S. consumer credit outstanding rose in October to the highest level since late 2009.  12/8

-U.S first time jobless claims dropped to their lowest level since February, 381,000.  12/9

-Chinese inflation cooled dramatically in November up 4.2% over the prior year compared to October which was up 5.5%.  12/9

-U.S. households’ net worth fell by $2.4 trillion over the third quarter, however consumers upped their spending. 12/9

-The U.S. trade gap tightened in October for a 4th straight month.  12/10

Corporate 

-Citigroup announced plans to cut 4,500 jobs and take a $400 million charge in the 4th quarter related to the dismissals.  12/7

-Ford will begin paying a dividend again for the first time in over 5 years.  12/9

-Toyota cut its earnings outlook in more than half on the rising yen and a prolonged recovery from the March natural disasters.  12/10

Market

-S&P put 15 Euro-zone nations on notice of a possible credit rating downgrade.  12/6

-At a summit of EU leaders, they could not reach a deal involving all parties of the 27 nation group to support a treaty revision that would tighten fiscal coordination amongst members.  However, an agreement amongst at least 23 countries was being worked through.  The ECB also announced it would cut its lending rate from 1.25% to 1.0%, but said it would not begin an active program to buy euro zone bonds. 12/9

-On the news of no additional ECB intervention in the bond markets and a uniformly supported agreement amongst EU nations, the markets dropped.  The Dow fell 1.6% breaking a 3 day up streak, the S&P fell 2.1%, and Europe dropped 1.5%.  12/9

-U.S. Stocks rebounded strongly on Friday on the news of the euro-zone’s newly signed treaty with all countries agreeing to rein in their budgets with only minimal deficits allowed.  The Dow jumped up 1.6%, the S&P rose 1.7%, Europe rose 1.2%, and yields in troubled European countries fell.  For the week the Dow rose 1.4%, the S&P gained 0.9%, and Europe was flat falling 0.1%. 12/10

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