Good morning. Happy Monday. Hope you had a nice weekend.
The cash market will begin the day and week with a small gap up. Nas 100 futures are up 1.50 (0.12%) to trade at 1212.50 and SPX futures are up 2.00 (0.23%) to trade at 883.25.
The Asian/Pacific markets closed mostly down. Hong Kong and Taiwan lost more than 3%, Singapore 2.8%, China and India more than 1%. Only Japan was able to close green.
Europe is mixed with a bearish lean. Austria is up 3.5% while Norway, Spain and Stockholm are down more than 1%. Germany, France and London are down.
China’s central bank cut its benchmark 1-year rate by 27 basis points to 5.31%.
Japanese exports plunged a record 26.7 percent in November, the Ministry of Finance said Monday, highlighting the drop in global consumer demand for automobiles, electronics parts and other Japanese products.
Toyota (TM) says it will lose money for the first time in 70 years due to plunging sales in the US and Europe and the strong yen. Auto stocks from around the globe (Daimler, BMW, Volkswagen, GM) are down.
Hyundai Motor Co. and Kia Motors cut their joint 2008 sales forecast by 12.5 percent Monday and said they would freeze pay for managers amid slumping vehicle demand.
AIG (AIG) sold its Hartford Steam Boiler unit to Munich Re for $742 million.
Moody’s downgraded the senior debt rating of XL Capital (XL) on concerns of reduced financial flexibility, anticipated profit weakness and a possible drop in market position.
Standard & Poor’s lowered the long-term ratings of American Express (AXP) and its subsidiaries. “The actions reflect our concerns about the weakening operating environment for consumer lenders, deterioration in Amex’s credit-card loan portfolio and Amex’s wholesale funding concentration,” said the S&P credit analyst.
S&P may lower the rating of Everest Re Group (RE) because the insurer’s underwriting performance fell below the rating agency’s expectations.
S&P also lowered the counterparty credit rating and the rating on Fifth Third Bank (FITB).
Nationwide Financial Services (NFS) and its subsidiaries may be downgraded by Moody’s.
Moody’s cuts ratings of Citigroup’s (C) US credit card business subsidiary.
Standard & Poor’s cuts CIT Group’s (CIT) counterparty rating to a still investment-grade “BBB+”
Walgreen’s (WAG) Q1 profit fell 10% on costs to open 200 new stores.
Park Electrochemical (PKE) reported profit fell by two-thirds and sales dropped 23%.
Steelcase (SCS) Q3 profit fell 99% on lower sales amid ongoing weakness in the economy that crimped demand for the office furniture maker’s products.
Epoch Holding (EPHC) said it will pay out a special cash dividend of 12 cents per common share on Jan. 15.
GlaxoSmithKline (GXK) is buying Bristol-Myers Squibb Pakistan and certain associated trademarks for around $36.5 million, bolstering emerging markets business.
St. Jude Medical (STJ) buys cardiovascular-devices maker Radi Medical for $250 million
SXC Health (SXCI) buys Zynchros for undisclosed amount
Gold is up 1.4% and Silver is up 1.0%.
Crude oil is up 60 cents to trade at 42.96.
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| UPGRADES |
CA, IPSU, IFX, NUE, BKC, FNF, OSG |
| DOWNGRADES | FORM, VRGY, TER, CCMP, LRCX, KLAC, NVLS, TSCO, OPNT, CTAS, AZO, COGT, GM, CNX, NEM, KGC, GG, EGO, ABX, AEM, DRI, X, ETN, NAT, GMR, TNK, CRH, NAT, FRO, TNP, OSG, PRU, PLCM |
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| EARNINGS | |
| before the open | ASFI, CC, SCS, WAG |
| during trading | none |
| after the close | RHT, TIBX |
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ECONOMIC RELEASES
none
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