Worldwide
Financial News
Stocks in U.S. Decline on Price, Housing Data; S&P Sinks to Five-Year Low U.S. stocks fell and the Standard & Poor's 500 Index slid below its lowest close since 2003 on growing concern over the fate of the nation's car industry and economic data signaling the recession is deepening.
Fed Policy Makers Saw Economy Shrinking Through Mid-2009 at Last Meeting Federal Reserve policy makers last month predicted the U.S. economy will contract through the middle of 2009, with some prepared to cut interest rates further in response, according to a record of their meeting.
Junk-Bond Yields Reach Record 20% as Weaker Economy Boosts Risk of Default Yields on speculative-grade corporate bonds surpassed 20 percent for the first time in at least two decades as a declining economy increased the risk of default.
Deutsche Bank to Cut 900 Jobs in Trading, Derivatives in New York, London Deutsche Bank AG, Germany's biggest bank, plans to cut about 900 jobs in its global markets division as the credit crisis worsens, two people briefed on the plan said.
Ackman Seeks $5.1 Billion IPO of Target REIT to Raise Funds for Retailer Hedge-fund manager William Ackman said the sale of as much as 20 percent of a real-estate investment trust that he's proposing be spun off of Target Corp. would raise $5.1 billion.
Credit Default-Swap Disclosure Rules May Increase in $47 Trillion Market U.S. regulators may require banks and insurers to disclose data about all credit-default swap trades to a central registry to boost transparency in the $47 trillion market, a person with knowledge of the talks said.
Australia & New Zealand
Financial News
Australia Risks Talking Itself Into a Recession, Says RBA Governor Stevens Australia risks talking itself into a recession even though the central bank has scope to cut interest rates and federal and state governments have the capacity to boost spending by borrowing, bank Governor Glenn Stevens said.
Asia-Pacific Economic Growth May Halve in 2009 as U.S. Slows, PECC Says Growth in the Asia-Pacific region may expand in 2009 at less than half the pace of the previous two years as the global financial crisis causes the U.S. economy to contract, the Pacific Economic Cooperation Council said.
Citigroup's Patterson Exits as Head of Trading in Asia as Job Cuts Begin Citigroup Inc.’s head of Asia- Pacific sales trading, Richard Patterson, has left after more than five years as the New York-based bank starts cutting jobs in the region, two people familiar with the matter said.
Linc Energy Will Locate Sapex Gas-to-Liquids Project in South Australia Linc Energy Ltd., an Australian energy company planning to convert coal into clean diesel, will locate its first commercial development in southern Australia.
Babcock Will Eliminate 63% of Jobs, Sell Businesses to Avoid Debt Default Babcock & Brown Ltd., the worst performing stock on the MSCI Asia-Pacific Index this year, will accelerate job cuts and separate its businesses to avoid defaulting on A$3.1 billion ($2 billion) of debt.
Japan, Australia Money Rates Advance as Recession Concerns Deter Lending Money market rates advanced in Australia and Japan as banks remained reluctant to offer credit amid a global recession.
Australian, New Zealand Dollars Surrender Earlier Gains as Stocks Slide The Australian and New Zealand dollars erased earlier gains against the greenback as slides in regional equities damped appetite for higher-yielding currencies.
Babcock Infrastructure Studies Sale of Stake in `Crown Jewel' Coal Harbor Babcock & Brown Infrastructure Group, owner of Australia's second-biggest coal-export harbor, said it's examining the potential sale of as much as 49 percent of the port after drawing interest from potential bidders.
Stocks
Americas
U.S. Stocks Slide as Data on Prices, Housing Signal Recession Is Deepening U.S. stocks fell and the Standard & Poor's 500 Index slid below its lowest close since 2003 on growing concern over the fate of the nation's car industry and economic data signaling the recession is deepening.
Brazilian Stocks Fall for a Fourth Day on Commodity Slump; Bolsa Declines Brazilian stocks dropped for a fourth day, led by raw-material producers, as commodity prices fell and analysts said steel demand will likely slow through next year.
Canada Stocks Fall, Led by Banks, on Scotiabank's Writedown; EnCana Drops Canadian stocks fell to a three-week low, led by finance shares, after a C$890 million writedown by Bank of Nova Scotia stoked concern other lenders' profits will be hurt by charges.
Europe
European Stocks Decline on Earnings Concern; BASF, UBS, SSAB Lead Retreat European stocks fell, pushing the Dow Jones Stoxx 600 Index to the lowest level since May 2003, as concern deepened the economic slowdown will cut profits for chemical companies, financial firms and commodity producers.
U.K. FTSE 100 Index Declines; Shell, Rio Tinto and HSBC Shares Lead Drop U.K. stocks declined as investors speculated the global recession is worsening and oil and metals prices slid. Royal Dutch Shell Plc, Europe's largest oil company, and Rio Tinto Group dropped.
Russian Stocks Sink Most in World as Reserves Dwindle, Oil Prices Retreat Russia's Micex Index fell for the second time this week as the lowest oil price in almost two years added to concern the central bank may struggle to defend the ruble after spending $57.5 billion to prop up the currency.
Analysts Cut Estimates for Almost Half of Stocks Worldwide, JPMorgan Says Analysts have cut profit estimates for 48 percent of stocks they cover worldwide, the most in at least 15 years, and more downgrades are likely as the economy slows, JPMorgan Chase & Co. said.
Asia
Asian Stocks Drop for Third Day; Banks, Commodity Producers Lead Declines Asian stocks fell for a third day, led by financial companies and commodity producers, as Sumitomo Mitsui Financial Group Inc. planned to raise cash and Oz Minerals Ltd. said earnings may decline.
Japan Stocks Fall, Led by Financial Companies, as Bad-Loan Concerns Mount Japan stocks declined, led by financial companies, on concern the nation's drop into recession will lead to an increase in bad-loan costs.
South Korea's Kospi Declines for Seventh Day as UBS Reduces Index Target South Korea's Kospi index slumped for a seventh day, the longest losing streak in more than four months, after UBS AG cut its target for the benchmark by 26 percent to reflect a ``sharp'' decline in earnings.
Japan's Dividends May Follow Profit Decline, Drag Share Prices to New Lows Japanese companies' dividend projections, on par with last year's record, may be set for declines in the face of a global recession, leading shares to new lows, said Yasuda Asset Management Co.'s Hiroshi Chano.
Bonds
Americas
U.S. Long-Term Treasuries Gain as Consumer Prices Fall the Most on Record Treasuries maturing in 10 years or more, the most sensitive to inflation expectations, rose after a government report showed consumer prices dropped in October by the most on record.
UBS Bond Analyst Laurie Goodman to Join Amherst Holdings Mortgage Firm Laurie Goodman, UBS AG's top-ranked head of fixed-income research who specializes in mortgage bonds, will join Amherst Holdings LLC, the Austin, Texas-based securities firm focused on home-loan assets.
Thornburg Mortgage Misses Interest Payments Because of Capital Shortage Thornburg Mortgage Inc., the U.S. ``jumbo'' home lender seeking to avert bankruptcy, said it missed a $12.2 million interest payment due last week because of a cash shortage.
Disclosure Demands for Credit-Default Swaps From Regulators Said to Climb U.S. regulators may require banks and insurers to disclose data about all credit-default swap trades to a central registry to boost transparency in the $47 trillion market, a person with knowledge of the talks said.
Europe
European Government Bonds Gain as ECB Signals Further Interest-Rate Cuts German 10-year government bonds advanced after European Central Bank council member Miguel Angel Fernandez Ordonez forecast an ``enormous'' drop in the region's inflation.
Corporate Bond Risk Increases Near to Record on GM, Ford Default Concern The cost of protecting corporate bonds from default rose to near a record on concern U.S. automakers won't get a bailout in time to prevent them from failing.
Money-Market Rates Decline on Central Bank Cash Injections, Rate Cut Bets The cost of borrowing in dollars for three months in London fell for a second day on speculation central-bank cash injections and deeper interest-rate reductions will further thaw the freeze in lending.
Braskem, Endesa Chile Face Refinancing `Trouble' as Yields Soar, RBC Says Braskem SA, Brazil's biggest petrochemicals company, and Empresa Nacional de Electricidad SA, Chile's largest electricity provider, may have ``trouble'' repaying $2.5 billion of debt in the next 15 months, according to analysts at RBC Capital Markets.
Asia
Japanese 10-Year Government Bonds Advance as Stocks Slide Amid Recession Japan's 10-year government bonds rose after Mitsubishi UFJ Financial Group Inc. said profit plunged, dragging down stocks and boosting demand for the perceived safety of state debt.
Philippine Rate Cuts May Fail to Curb Higher Bond Yields on Wider Deficit Interest-rate cuts by the Philippine central bank may fail to prevent local bond yields from rising as a looming global recessions prompts the government to boost spending, economists said.
John Paulson Buys Mortgage Bonds as Hedge Funds Decline for a Fifth Month Money manager John Paulson has started buying beaten-up mortgage bonds as hedge funds stumbled for a fifth straight month.
Japan's `Ivy League' Universities Become Latest Victims of Credit Crisis Japan's top universities are falling victim to the global financial crisis that has caused $964.6 billion in writedowns and losses at financial institutions.
Commodities
Crude Oil Falls After U.S. Petroleum Inventories Gain, Fuel Demand Drops Crude oil futures fell after a U.S. Energy Department report showed that inventories climbed more than forecast as fuel demand dropped.
Gold Rises on Speculation Dollar Rally Will Stall, Burnsh Metal's Allure Gold rose for the first time this week in New York on speculation that the dollar's rally will stall, boosting the appeal of the precious metal as an alternative investment. Silver and platinum declined.
Tin Falls to Three-Weeek Low as Increasing Stockpiles Signal Lower Demand Tin fell to a three-week low in London as expanding stockpiles signaled production is outpacing demand. Copper, nickel and aluminum also dropped.
Corn Falls, Erasing Early Gains, as Dollar Pares Losses; Soybeans Steady Corn fell for a second day, erasing earlier gains, on speculation that demand for U.S. commodities will decline after the dollar pared earlier losses. Soybeans were little changed.
Hog Price Gains as U.S. Ham Demand May Rise for Holidays; Cattle Decline Hog prices rose for a second day on speculation U.S. grocers are stepping up ham purchases to prepare for increased demand before the Christmas and New Year's holidays. Cattle futures fell, erasing earlier gains.
Cocoa Posts Longest Winning Streak in London in Nine Months on Deliveries Cocoa rose in London, recording the longest winning streak in nine months, after reports deliveries have declined in Ivory Coast, the world's biggest grower, and production may drop.
Emerging Markets
Ecuador's Viteri Urges `Anxious' Creditors to Wait For Final Debt Report Ecuador's Finance Minister Maria Elsa Viteri urged ``anxious'' bondholders to be patient as a debt auditing commission finishes a report that will help determine whether the country honors its foreign obligations.
Braskem, Endesa Chile Face Refinancing `Trouble' as Yields Soar, RBC Says Braskem SA, Brazil's biggest petrochemicals company, and Empresa Nacional de Electricidad SA, Chile's largest electricity provider, may have ``trouble'' repaying $2.5 billion of debt in the next 15 months, according to analysts at RBC Capital Markets.
Russia Suffers Plummeting Reserves in Defense of Ruble as Growth Declines Russia's foreign-exchange reserves are draining fast and may take almost a decade of economic stability with them.
India Has Scope to Cut Rates as Growth, Inflation Slows, Chidambaram Says India's central bank has scope to cut borrowing costs further as growth slows and inflation approaches a level ``we can live with,'' Finance Minister Palaniappan Chidambaram said.
Wynn in `Complete Disagreement' With Las Vegas Sands on Macau Development Wynn Resorts Ltd. Chairman Steve Wynn said he’s in “complete disagreement” with a Las Vegas Sands Corp. senior executive who said government decisions may have hurt the development of Macau casinos.
Pakistan's `No Prospects' Airline Pledges New York, Paris Hotels for Cash Pakistan International Airlines Corp., on course for a fourth straight annual loss, plans to raise 30 billion rupees ($379 million) by pledging two hotels as it struggles to raise funds amid the credit crunch.
Energy
Crude Oil Declines on Increase in U.S. Inventories as Fuel Demand Weakens Crude oil futures fell after a U.S. Energy Department report showed that inventories climbed more than forecast as fuel demand dropped.
Saudi Oil Tanker Owners Are in Talks With Pirates on Ransom for Ship, Crew The owners of an oil-laden Saudi Arabian supertanker hijacked off the coast of Somalia are in talks with pirates over a ransom.
Oil May Fall to $40 a Barrel by April as Demand Collapses, Deutsche Says Oil prices may fall as low as $40 a barrel by April as demand collapses and production costs ease, Deutsche Bank AG said.
Solarworld Will Offer to Buy GM Opel Sites in Germany to Build Green Cars Solarworld AG, Germany's third- largest solar company, will offer to buy the German operations of General Motors Corp.'s Opel division and transform it into a green carmaker.
Halliburton Says It May Be `Challenging' to Reach Goals in Current Climate Halliburton Co. Chief Financial Officer Mark McCollum said that while the world's second-largest oilfield-services provider has the balance sheet to consider acquisitions, he doesn't see buying back shares until the markets improve and said it may be ``very challenging'' to meet long-term goals next year.
Shell, Aramco Delay Oil Project Spending on Slowdown, Says Morgan Stanley The biggest oil companies including Saudi Aramco, Royal Dutch Shell Plc and Petroleo Brasileiro SA are accelerating spending cuts and delaying projects as the world enters a recession, said Morgan Stanley & Co.
Petrobras Says It's Too Early to Determine Delay in Oil Investment Plans Petroleo Brasileiro SA, Brazil's state-controlled oil company, said it's too early to decide whether the decline in oil prices and the worldwide credit crunch will require a revision of exploration and output plans.
BW Gas, TMT, Euronav Vessels May Avoid Somalia After Attacks by Pirates Shipowners controlling almost a fifth of the world's oil supertankers may shun Egypt's Suez Canal after an escalation in pirate attacks off the east coast of Africa, potentially increasing the cost of delivering crude.
Nymex Gas Rises as Cold Snap Increases Heating Demand in Northeastern U.S. Natural gas in New York rose on speculation a blast of cold weather will linger longer than anticipated, boosting heating demand and prompting a draw down in supplies stored for the U.S. winter.
Energy Trading Volumes Will Fall in 2009 on Tighter Credit, GFI Chief Says GFI Group Inc. expects energy trading volumes to slide until the end of next year as utilities and financial companies tighten credit and limit counterparty risk.
EU May Authorize 11% Increase in Imports of Emissions Credits Through 2020 European Union lawmakers may let energy and manufacturing companies import 11 percent more emission credits through 2020 to reduce the cost of stricter domestic caps on pollution blamed for climate change.
Chevron Says Nigeria Field Pipeline Breach May Interrupt Crude-Oil Exports Chevron Corp., the second-largest U.S. oil company, suspended export obligations on some Nigerian production following a pipeline breach at the Escravos oilfield.
Excel Futures' Waggoner Sees Crude Oil Price Headed for $50-a-Barrel Level Mark Waggoner, president of Excel Futures Inc., talks with Bloomberg's Monica Bertran about the outlook for crude oil prices.
What's Bad for Petrobras, Bad for Brazil: Commentary by Alexandre Marinis The shares of Brazilian oil company Petroleo Brasileiro SA, or Petrobras, have tumbled 62 percent since May. Another sad chapter in the 2008 financial debacle, perhaps?
Cadogan Says Ukraine Ministry Has Appealed Against Company's Gas Licenses Cadogan Petroleum Plc, a British oil and gas producer operating in Ukraine, said an appeal over two disputed exploration licenses will be heard by a court in Kharkiv.
Origin Says Output at BassGass off Southern Australia Is Cut by Shutdown Origin Energy Ltd., Australia's second-biggest energy retailer, said production at the BassGas natural gas project off the southeast coast has been cut by about two-thirds because of a well shutdown.
Crude Oil Declines for a Fourth Day on Forecast U.S. Stockpiles Increased Crude oil fell for a fourth day, dropping below $54 to its lowest in 22 months, on expectations U.S. inventories gained last week as fuel demand in the world’s largest user declined.
Nymex Gas Rises as Cold Snap Increases Heating Demand in Northeastern U.S. Natural gas in New York rose on speculation a blast of cold weather will linger longer than anticipated, boosting heating demand and prompting a draw down in supplies stored for the U.S. winter.
Energy Trading Volumes Will Fall in 2009 on Tighter Credit, GFI Chief Says GFI Group Inc. expects energy trading volumes to slide until the end of next year as utilities and financial companies tighten credit and limit counterparty risk.
EU May Authorize 11% Increase in Imports of Emissions Credits Through 2020 European Union lawmakers may let energy and manufacturing companies import 11 percent more emission credits through 2020 to reduce the cost of stricter domestic caps on pollution blamed for climate change.
Chevron Says Nigeria Field Pipeline Breach May Interrupt Crude-Oil Exports Chevron Corp., the second-largest U.S. oil company, suspended export obligations on some Nigerian production following a pipeline breach at the Escravos oilfield.
Funds
John Paulson Buys Mortgage Bonds as Hedge Funds Decline for a Fifth Month Money manager John Paulson has started buying beaten-up mortgage bonds as hedge funds stumbled for a fifth straight month.
Ackman Seeks $5.1 Billion IPO of Target REIT to Raise Funds for Retailer Hedge-fund manager William Ackman said the sale of as much as 20 percent of a real-estate investment trust that he's proposing be spun off of Target Corp. would raise $5.1 billion.
Amerindo's Vilar, Tanaka Found Guilty of Stealing $20 Million From Clients Alberto Vilar and Gary Tanaka, whose Amerindo Investment Advisors made and then lost billions of dollars for investors in computer and Internet stocks, were found guilty of a scheme to steal $20 million from their clients.
Bhattacharya Sees Buffett Example in Hindalco Rebound From 75% Stock Slump Hindalco Industries Ltd. Managing Director Debu Bhattacharya said investors should follow Warren Buffett, named America's richest man by Forbes magazine , rather than rebuff stocks, after India's largest aluminum producer lost almost three-quarters of its market value this year.
Babcock, MSCI Asia's Worst Performer, Hastening Job Cuts to Avoid Default Babcock & Brown Ltd., the worst performing stock on the MSCI Asia-Pacific Index this year, will accelerate job cuts and separate its businesses to avoid defaulting on A$3.1 billion ($2 billion) of debt.
JO Hambro to Shut Hedge Fund After Bet Against Volkswagen Shares Backfires JO Hambro Capital Management Ltd., which oversees about $3.5 billion of assets, will close one of its two hedge funds after a bet against Volkswagen AG shares backfired, people familiar with the situation said. The fund is one of the first to be shut by the trade.
Indiabulls Is Anything But as Profit Erodes With Hedge Funds Taking Losses Indiabulls Group, the Mumbai-based finance firm funded by billionaire Lakshmi Mittal, is shifting from increasing profitability to ``survival'' after the collapse of Lehman Brothers Holdings Inc. froze credit markets.
Obama Embrace of Wall Street Insiders Points to Politic Regulatory Reforms During the height of the financial crisis in late September, some of Barack Obama's campaign advisers pushed him in a conference call to distance himself from Treasury Secretary Henry Paulson. The former Goldman Sachs Group Inc. chief executive officer, they warned, was too close to President George W. Bush and Wall Street.
Municipal Bonds
U.S. Long-Term Treasuries Gain as Consumer Prices Fall the Most on Record Treasuries maturing in 10 years or more, the most sensitive to inflation expectations, rose after a government report showed consumer prices dropped in October by the most on record.
Ambac's Rating Cut Three Grades to A by S&P, Outlook Negative on Mortgages Ambac Financial Group Inc. fell below $1 a share for the first time since going public
Economy
Fed Officials Saw Economy Shrinking Through Mid-2009 at Meeting Last Month Federal Reserve policy makers last month predicted the U.S. economy will contract through the middle of 2009, with some prepared to cut interest rates further in response, according to a record of their meeting.
Consumer Prices in U.S. Decline 1%, Most on Record, as Fuel Costs Tumble The cost of living in the U.S. fell by the most on record and construction began on the fewest homes ever last month, evidence the economy is in the worst recession in at least a quarter century.
BOE Considered Bigger Rate Reduction When It Lowered Borrowing Costs to 3% Bank of England policy makers considered an even bigger reduction in the benchmark interest rate than the 1.5 percentage-point cut announced on Nov. 6 as their forecasts pointed to a deepening recession.
Bernanke's Cash Injections Risk Eclipse of Fed's Benchmark Interest Rate The Federal Reserve's efforts to rescue the U.S. from financial collapse risks the eclipse of the central bank's benchmark interest rate as the most important signal of monetary policy.
EU Preparing $164 Billion Package to Bolster Region's Growth, Germany Says The European Commission is working with the 27 EU states on a 130 billion-euro ($164 billion) package to bolster the region's economy amid recession, according to German government officials.
ECB's Ordonez Forecasts `Enormous' Decline in Euro-Region Inflation Rate European Central Bank council member Miguel Angel Fernandez Ordonez forecast an ``enormous'' drop in euro-region inflation.
Belgian Economy Faces `Very Negative Impact' From Financial-Market Crisis The global financial crisis could have a ``very negative impact'' on Belgium's economy, the government's Federal Planning Bureau said.
Asia-Pacific Economies May Grow at Half Pace as Crisis Spreads, PEEC Say Growth in the Asia-Pacific region may expand in 2009 at less than half the pace of the previous two years as the global financial crisis causes the U.S. economy to contract, the Pacific Economic Cooperation Council said.
ECB's Trichet Says World Suffering Worst Financial Crisis of Postwar Era European Central Bank President Jean-Claude Trichet said the world is experiencing its worst financial crisis since the aftermath of World War II.
EU May Allow 11% More Imported Emission Credits Through 2020 in Compromise European Union lawmakers may let energy and manufacturing companies import 11 percent more emission credits through 2020 to reduce the cost of stricter domestic caps on pollution blamed for climate change.
U.S. Consumer Prices Decline 1 Percent, Most on Record: Table of the Day Following is a summary of the Oct. consumer price report from the Labor Department.
Fed Watch
Fed Policy Makers Saw Economy Shrinking Through Mid-2009 at Last Meeting Federal Reserve policy makers last month predicted the U.S. economy will contract through the middle of 2009, with some prepared to cut interest rates further in response, according to a record of their meeting.
Bernanke's Cash Injections Risk Eclipse of Fed's Benchmark Interest Rate The Federal Reserve's efforts to rescue the U.S. from financial collapse risks the eclipse of the central bank's benchmark interest rate as the most important signal of monetary policy.
Fed's Kohn Says Risk of Deflation in U.S., While Bigger, `Is Still Small' Federal Reserve Vice Chairman Donald Kohn said the risk of deflation, while slight, is larger than four months ago and the central bank if necessary should be aggressive in averting a decline in prices.