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Archive for September, 2012|Monthly archive page

Stocks: Job market to steal the show

In Uncategorized on September 30, 2012 at 1:37 pm

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NEW YORK (CNNMoney) — The fourth quarter kicks off with a series of important reports on the U.S. economy.

While data from across the economic spectrum is expected this week, investors will pay most attention to reports about jobs. Figures about private sector job growth from paycheck processing firm ADP (ADP, Fortune 500) and a reading on initial claims will give a preview of what’s going on in the labor market on Wednesday and Thursday.

But those figures lead up to the main event on Friday, when the Labor Department releases its employment report.

Last month, the economy added only 96,000 to payrolls, less than what’s needed to keep up with population growth. And while the unemployment rate fell to 8.1%, the improvement came as a result of nearly 400,000 of those without jobs stopping their search for work.

The persistent weakness in the labor market was a major factor in the Federal Reserve’s decision to pump more money into the economy through the purchase of mortgage bonds in a third round of quantitative easing, popularly known as QE3.

Investors will get a glimpse into what went into the central bank’s decision to announce QE3 when the Fed releases minutes from its September FMOC meeting on Thursday. Since the Fed’s decision leaves the size and duration of the stimulus open-ended, investors will be mining the minutes for clues as to what it plans to do next.

Any improvement or slowdown in the economy could impact how much and how long the central bank intervenes, which explains why economic data has come under even more scrutiny since the Fed announced it stimulus measures.

Related: Obama may be a job creator after all

Besides data on the jobs market, investors will look for reports on the manufacturing sector, as the Institute for Supply Management releases a report on the sector’s strength in September on Monday.

Manufacturing activity in the U.S. has contracted three months in a row, according to the ISM’s most recent reports. And given that last week’s Chicago Purchasing Managers Index for September came in far below expectations and showed a contracting economy for the first time since 2009, investors aren’t expecting this week’s report to be any better.

General Motors (GM, Fortune 500), Ford (F, Fortune 500), Toyota (TM), Honda (HMC) and other automakers are due to release sales figures for September on Tuesday.

Only a small handful of companies are on tap to report earnings this week, including agricultural companies Mosaic (MOS, Fortune 500) and Monsanto (MON, Fortune 500), hotel owner Marriott (MAR, Fortune 500) and wine and spirits maker Constellation Brands (STZ).

Analysts aren’t expecting much movement in the market despite the fact that investors will get a clearer picture of where the economy is headed. According to Brian Gendreau, market strategist with Cetera Financial, that’s because the numbers will be more of the same.

“We’re in a period of slow growth and the outlook hasn’t really changed,” he said. “With the data this week, I fully expect the reports to show that we’re in a weak economy with slight improvement.”

While most of the attention will be on the U.S. economy this week, Europe will once again share the spotlight ahead of the European Central Bank’s Governing Council meeting on Thursday. Worries over the eurozone were reignited last week, as Europeans protested austerity measures in Greece and Spain.

Spain passed two major hurdles last week when it proposed its 2013 budget and results from an independent auditor’s stress test fell in line with expectations. But worries over Spain’s banking trouble persist. Many think it’s just a matter of time before the ailing nation asks for a bailout.

Related: Most Spanish banks pass stress tests

U.S. stocks finished the year’s third quarter with solid gains, but were lower for the week. The Dow Jones Industrial Average, the SP 500 and the Nasdaq ended the week down between 1% and 2%.

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China manufacturing continues to slump

In Uncategorized on September 30, 2012 at 1:27 am

NEW YORK (CNNMoney) — China’s manufacturing sector remains in a slump, renewing concerns that the world’s second-largest economy is in the midst of a sharp slowdown sparked by Europe’s debt crisis.

The HSBC Purchasing Managers’ Index, a key measure of manufacturing produced by global banking giant HSBC (HBC) and data research firm Markit, came in at 47.9 in September.

That was up slightly from 47.6 in August and higher than an initial estimate of 47.8 for September that was released last week. However, any reading below 50 is an indication that the manufacturing sector is contracting.

China’s economy is still growing at a faster rate than the economies of the United States, Europe and Japan. But there are worries that the pace is slowing due to the problems in Europe as well as sluggishness in the U.S. Both Europe and the U.S. are key export markets for China.

To that end, HSBC said Saturday that the volume of new orders in September was down for the eleventh consecutive month. New export orders declined at their sharpest rate in three-and-a-half years due to weaker international demand.

Related: China stocks stuck in massive rut

This may be starting to have an impact on Chinese consumers as well. Athletic apparel maker Nike (NKE, Fortune 500) warned late Thursday that it was seeing a slowdown in demand in China. Shares of Yum! Brands (YUM, Fortune 500) and McDonald’s (MCD, Fortune 500), two companies that also have a significant presence in China, fell Friday along with Nike.

Several economists have recently cut their growth forecasts for China to the mid 7% range. China’s economy had been growing around 10% for the past few years. And China’s benchmark stock index, the Shanghai Composite, is near multi-year lows.

China’s central bank has already lowered interest rates twice this year in an attempt to accelerate growth. The Chinese government also recently announced a plan to spend more than $150 billion on transportation and other infrastructure projects. But some experts believe China will soon to need more.

Hongbin Qu, chief economist for China and co-head of Asian economic research at HSBC, said in a statement that “the sharper contraction of new export orders and the lingering pressures on job markets mean that Beijing should step up easing to support growth and employment.”

But China’s government will soon undergo a major transition in the coming months, a once-in-a-decade move that will reshape the leadership of the Communist Party. It is unclear if China will announce any more significant stimulus measures until the new leaders are in place.

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GM recalls more than 40,000 cars on fuel leak concerns

In Uncategorized on September 30, 2012 at 1:27 am

NEW YORK (CNNMoney) — General Motors is recalling more than 40,000 vehicles, citing concerns that a fuel pump module could crack and cause a fire in the event of a fuel leak.

The recall, disclosed in a letter by GM (GM, Fortune 500) to the National Highway Traffic Safety Administration (NHTSA) Friday, affects five models from 2007 through 2009: the Chevrolet Cobalt (2007-2009), Chevrolet Equinox (2007), Pontiac G5 (2007-2009), Pontiac Torrent (2007) and Saturn Ion (2007).

GM said the models were originally sold or registered in Arkansas, Arizona, California, Florida, Nevada, Oklahoma and Texas. GM said the cars “have a condition in which the plastic supply or return port on the fuel pump module may crack, which could cause a fuel leak.”

Cool cars from the Paris autoshow

The automaker said that it will notify owners about the recall, and that dealers will replace the fuel pump module for free.

This is the third recall for GM in the past few months. Earlier in September, GM said it was recalling more than 426,000 sedans in the U.S. because of transmission problems. In June, GM recalled more than 400,000 Chevrolet Cruzes due to engine issues.

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Article source: http://rss.cnn.com/~r/rss/money_latest/~3/jQSNUndcRhA/index.html

Weekly Address: It’s Time for Congress to Help Responsible Homeowners

In Uncategorized on September 29, 2012 at 1:12 pm

In this week’s address, President Obama explains his administration’s steps to help the housing market, including giving responsible homeowners a chance to save thousands of dollars every year by refinancing their mortgages, but says we need Congress’s help to do more.

Transcript | Download mp4 | Download mp3

Article source: http://www.whitehouse.gov/blog/2012/09/29/weekly-address-it-s-time-congress-help-responsible-homeowners

Parks for the People: Getting Outside on National Public Lands Day

In Uncategorized on September 29, 2012 at 12:57 am

Ed. note: This post was originally published on Let’s Move!.

Tomorrow, more than 170,000 people across the country are expected to celebrate National Public Lands Day – America’s largest, single-day, outdoor volunteer effort. More than 2,000 public land and water sites across the country will offer FREE admission to volunteers who give a few hours of their time to help improve and restore outdoor spaces. 

National Public Lands Day is a great opportunity to get active while showing your appreciation for the public parks, trails, beaches, lakes, rivers and forests that belong to all of us as Americans.  Last year, volunteers collectively planted more than 100,000 trees and plants and maintained or built 1,500 miles of trails – all in one day’s work! This year, the goal is to top those contributions and engage more kids and families.

With events taking place in every state, there are many different ways to get involved. 

  • What: The 19th annual National Public Lands Day
  • When: All day on Saturday, September 29th
  • Where: More than 2,000 sites across the country
  • Why: Help take care of America’s great outdoors and enjoy a FREE outdoor day with your family.

You don’t need any special equipment to participate in a National Public Lands Day event! Host sites will provide all the tools and training you need to have a fun, productive day. Be sure to check the weather before you head out, and dress appropriately. It’s also a good idea to bring plenty of water and healthy snacks, like trail mix, fresh or dried fruit, or whole grain crackers or pretzels. 

For some added inspiration, check out this video from Secretary of the Interior, Ken Salazar, one of America’s greatest champions of outdoor recreation and conservation.

Check out Secretary Ken Salazar’s full remarks here.

For more information on National Public Lands Day, you can visit www.publiclandsday.org.

Article source: http://www.whitehouse.gov/blog/2012/09/28/parks-people-getting-outside-national-public-lands-day

More Than 2.6 Million Records Released

In Uncategorized on September 29, 2012 at 12:57 am

In September 2009, the President announced that—for the first time in history—White House visitor records would be made available to the public on an ongoing basis. Today, the White House releases visitor records that were generated in June 2012. Today’s release brings the total number of records made public by this White House to more than 2.6 million—all of which can be viewed in our Disclosures section.

Ed. note: For more information, check out Ethics.gov.

Article source: http://www.whitehouse.gov/blog/2012/09/28/more-26-million-records-released

RIM stock rises 17% after not-so-bad quarter

In Uncategorized on September 29, 2012 at 12:57 am

NEW YORK (CNNMoney) — Research in Motion’s sales slumped 31% from a year ago, and the BlackBerry maker also swung to a loss. But the results weren’t as bad as feared, so investors sent the stock 17% higher in Friday premarket trading.

RIM (RIMM) booked a net loss of $235 million, or 45 cents per share, on sales of $2.9 billion for its fiscal second quarter. RIM turned a profit of $329 million in the same period last year.

Still, the results released Thursday beat the consensus estimate from analysts polled by Thomson Reuters. Wall Street expected a loss of 46 cents per share on sales of $2.5 billion.

The question on everyone’s minds is the BlackBerry 10 operating system, which had been slated for release later this year. In June, RIM revealed that BlackBerry 10 wouldn’t hit the market until the first quarter of 2013. The news was so damning that critics wondered aloud if RIM could even survive long enough to launch new devices.

RIM mentioned BlackBerry 10 just once in its financial results release, reiterating that it’s on track for the early-2013 launch window. But CEO Thorsten Heins conceded that the company is facing many challenges: “Make no mistake about it, we understand that we have much more work to do.”

Many analyst questions on a Thursday evening conference call revolved around BlackBerry 10. Heins said the company “plan[s] to be relentless in ensuring the success of BlackBerry 10,” and he revealed some details about the rollout plan. The first devices to launch on the OS will be in the mid- to high-end price range. Entry-level phones could also come out next year.

Heins continued the we-have-work-to-do theme while on the call, saying the company is “committed to making difficult choices and significant changes” in order to make it permanently stronger.

Those changes — which include costs related to headcount reduction, coupled with marketing expenses for BlackBerry 10 — mean that RIM is expecting an operating loss for the current quarter.

On the positive side, the BlackBerry maker increased its cash position last quarter to $2.3 billion, up $100 million from its fiscal first quarter. The number of BlackBerry subscribers grew 2 million during the past three months to 80 million worldwide.

RIM also broke out sales percentages for each sector of its business. Hardware made up 60%, service revenue comprised 35%, and software rounded out the last 5%.

Although hardware still represents the majority of the company’s sales, RIM is stuck in a holding pattern until BlackBerry 10 arrives. The company shipped just 7.4 million BlackBerry smartphones and approximately 130,000 PlayBook tablets during the second quarter.

Meanwhile, everyone from Apple (AAPL, Fortune 500) to Nokia (NOK) to Microsoft (MSFT, Fortune 500) has released shiny new gadgets recently.

RIM’s main problem is its lost stronghold in the corporate market, where it once dominated. Rather than issuing company BlackBerries, many employers now have workers bring their own devices into work. Those workers usually choose Apple’s (AAPL, Fortune 500) iPhone and Google’s (GOOG, Fortune 500) Android devices.

Investors are also worried. Before Thursday’s big pop after hours, RIM shares had lost half of their value in 2012 alone.

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Article source: http://rss.cnn.com/~r/rss/money_latest/~3/0BcbYnKEffw/index.html

Stocks: Spain in focus

In Uncategorized on September 29, 2012 at 12:57 am

Click on chart for more premarket data.

NEW YORK (CNNMoney) — U.S. stocks were set to close out the third quarter Friday, with investors balancing global growth concerns and hope that Spain will soon ask for a bailout from neighbors.

Investors will be focused on Europe after the release of Spain’s 2013 budget on Thursday. The proposed budget boosted U.S. stocks late Thursday, as many interpreted it as a sign the country is willing to take necessary steps to avert a deepening crisis. But that relief may prove ephemeral as concerns about Spain remain.

Spanish banks will receive auditors’ results of stress tests, which will give investors a clearer view of the area’s economic struggles. The nation’s bonds could also be in for a downgrade from Moody’s, according to reports. Yields for the 10-year Spanish bond pushed above 6% again on Friday.

Fear Greed Index

In Britain, a government recommendation was published Friday suggesting “a complete overhaul” of the interest rate benchmark Libor, following the recent scandal that exposed how banks rigged the rate for their own benefit.

European stocks were mixed in midday trading. Britain’s FTSE 100 shed 0.1%, while the DAX in Germany fell 0.5% and France’s CAC 40 dropped 1.6%.

In Asia, Chinese investors continued to rally on the central bank’s record injection of liquidity into money markets. The Shanghai Composite ended 1.5% higher, and the Hang Seng in Hong Kong rose 0.4%.

But the outlook remained grim in Japan, where a government report showed Japanese industrial production and prices fell in August, a worrying development given the country’s current territorial dispute over islands that have hurt Japanese businesses in China. As a result, Japan’s Nikkei ended down 0.9%.

U.S. stocks are ending a solid third quarter and month of September. The Dow Jones industrial average enters Friday up 4.7% for the quarter and 3% for the month. Entering the final three months of 2012, the Dow is up more than 10%.

The first domestic report of the day showed personal income grew at 0.1% in August — the same as July. Personal spending rose 0.5%, slightly higher than in July. Both are signs the recovery continues to struggle.

Meanwhile, the Bureau of Economic Analysis reported that core prices of household goods and services rose 0.1% in August, as expected.

At 9:45 a.m. ET, the Chicago Purchasing Managers Index for September — a manufacturing measure — will be published, followed by the University of Michigan releasing the final edition of its consumer sentiment index for September.

Companies: Drugstore chain Walgreen (WAG, Fortune 500) reported earnings of 62 cents per share, beating expectations. But sales and profits were down from a year ago. Shares of Walgreen fell 1.6% in premarket trading.

Facebook (FB) shares rose 1% in premarket trading on news that the company has developed another revenue source: a gift-giving service with partners like Starbucks, Magnolia Bakery and 1-800-Flowers.

Shares of Research in Motion (RIMM) jumped nearly 19% in premarket trading, after the BlackBerry maker reported a narrower-than-expected loss and beat expectations on revenue.

Shares of Nike (NKE, Fortune 500) fell in after-hours trading, even though the athletic shoe maker beat forecasts on both revenue and profits.

Currencies and commodities: The dollar slid against the euro but gained versus the British pound and Japanese yen.

Oil for November delivery rose 4 cents to $91.89 a barrel.

Gold futures for December delivery rose 60 cents to $1,781.10 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 1.61% from 1.64% late Thursday.

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Apple CEO Tim Cook’s letter: "We fell short"

In Uncategorized on September 29, 2012 at 12:57 am

NEW YORK (CNNMoney) — Apple (AAPL, Fortune 500) issued a rare apology on Friday in response to customer complaints over its new and buggy Apple Maps app, which replaced Google (GOOG, Fortune 500) Maps in Apple’s recent iOS 6 update. Below is the text of Apple CEO Tim Cook’s letter.

To our customers,

At Apple, we strive to make world-class products that deliver the best experience possible to our customers. With the launch of our new Maps last week, we fell short on this commitment. We are extremely sorry for the frustration this has caused our customers and we are doing everything we can to make Maps better.

We launched Maps initially with the first version of iOS. As time progressed, we wanted to provide our customers with even better Maps including features such as turn-by-turn directions, voice integration, Flyover and vector-based maps. In order to do this, we had to create a new version of Maps from the ground up.

There are already more than 100 million iOS devices using the new Apple Maps, with more and more joining us every day. In just over a week, iOS users with the new Maps have already searched for nearly half a billion locations. The more our customers use our Maps the better it will get and we greatly appreciate all of the feedback we have received from you.

While we’re improving Maps, you can try alternatives by downloading map apps from the App Store like Bing, MapQuest and Waze, or use Google or Nokia maps by going to their websites and creating an icon on your home screen to their web app.

Everything we do at Apple is aimed at making our products the best in the world. We know that you expect that from us, and we will keep working non-stop until Maps lives up to the same incredibly high standard.

Tim Cook

Apple’s CEO

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Article source: http://rss.cnn.com/~r/rss/money_latest/~3/nyFZKj2LiPM/index.html

Spending climbs, but wages don’t

In Uncategorized on September 29, 2012 at 12:57 am

Consumer spending increased in August, even though wages did not show much improvement.

NEW YORK (CNNMoney) — Spending by consumers picked up in August, although people dipped into their savings to buy things, as growth in their paychecks did not keep pace.

Spending increased 0.5% in the month, according to the Commerce Department report, up from a 0.4% increase in July. Spending by consumers accounts for nearly three-quarters of the nation’s economic activity, so growth in spending an important driver of economic growth.

But for the second straight month personal income grew by only 0.1%, as the continued weakness in the jobs market has kept wages in check.

Some of the spending was paid for by a drop in the average amount saved by consumers. The savings rate fell to 3.7% of after-tax income, which means the typical worker saved only $3.70 out of every $100 of take-home pay.

Some of the increase in spending may have been driven by higher gasoline prices in the period, since non-durable goods accounted for the majority of the increase in spending. Gas prices jumped 9% in the month, according to a previous government reading. Excluding the rise in gas prices, spending by consumers crept up only 0.1% in the month.

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