Monday Morning Business Update is an Open Thread
|From Yahoo News Business|
1 Wall Street may brake for housing, Home Depot
By Ellis Mnyandu, Reuters
Sun May 17, 7:46 pm ET
|NEW YORK (Reuters) – Stocks are likely to hit more speed bumps this week as investors become more wary of Wall Street’s ability to rally further and housing starts, jobless claims and other indicators are in the spotlight.
With first-quarter earnings reports winding down and recent optimism about economic stabilization already factored into stock prices, analysts said there appears to be very little on the horizon to help extend the recent run-up.
Quarterly earnings from rival home-improvement chains Home Depot Inc (HD.N) and Lowe’s Cos Inc (LOW.N) may shed some light on the consumer’s ability and inclination to spend. The numbers may also give a hint of any further fallout from the housing slump.
2 AIG to launch IPO for Asia crown jewel
By Michael Flaherty, Reuters
2 hrs 58 mins ago
|HONG KONG (Reuters) – AIG said it would accelerate plans to separate its Asian subsidiary through an initial public offering as the bailed-out U.S. insurer seeks to raise cash and list the unit as soon as possible.
The offering could raise at least $4 billion based on targets set by AIG executives, making it one of the largest Hong Kong IPOs to hit the market in the last two years.
The IPO would allow AIG to raise money to pay back the U.S. government and allow the profitable Asia life insurance subsidiary, American International Assurance Co Ltd (AIA), to break from its ailing parent.
3 Asian carriers brace for more rough weather
by Bernice Han, AFP
Sun May 17, 2:07 am ET
|SINGAPORE (AFP) – Asia’s leading airlines are bracing themselves for more rough weather after earnings nosedived in the first quarter with no signs of a global economic recovery in sight, industry analysts said.
Compounding the airlines’ woes are the outbreak of swine flu and growing popularity and longer reach of budget airlines in the region, they said.
Singapore Airlines (SIA), the latest Asian carrier to release its results, said net profit in its fourth quarter ending March tumbled 92 percent on the year to 41.9 million Singapore dollars (28.5 million US).
4 EBRD seeks to guide ex-Soviet bloc to economic recovery
by Roland Jackson, AFP
Sat May 16, 1:37 pm ET
|LONDON (AFP) – The European Bank for Reconstruction and Development met Saturday to help guide crisis-hit eastern Europe towards recovery and prevent a reversal of two decades of major economic reforms.
The EBRD, formed in 1991 to help former communist nations adopt market economies after the collapse of the Soviet Union, has switched attention to fighting the brutal financial crisis which has crippled its investment zone.
“Today we have the task to sustain the promise of 20 years ago, the enormous achievements in the intervening 20 years sometimes might be underestimated,” EBRD President Thomas Mirow said in closing comments to the board of governors.
5 Crisis bad news for Russia’s shrinking population
by Alissa de Carbonnel, AFP
Sun May 17, 2:46 am ET
|MOSCOW (AFP) – State-sponsored posters call for Russians to do their duty and have big families. One lining the Moscow metro shows a woman juggling three stout babies, another preaches “love for your nation, starts with the family”.
Only in January, President Dmitry Medvedev touted the success of the government’s drive to boost the population, saying births were up over eight percent in 2007 and six percent in 2008 — the highest birth rates in 25 years.
But the demographic outlook is bleak. According to a recent UN report entitled “Russia Facing Demographic Challenges,” the country’s population has shrunk by 12 million people in the last 16 years.
6 China keeps buying US bonds despite concerns
by P. Parameswaran, AFP
Sat May 16, 11:13 pm ET
|WASHINGTON (AFP) – China is pumping more money into US Treasury bonds, recent data show, despite concerns expressed in Beijing in recent months over the safety of dollar-linked assets.
Mainland China’s holding of Treasury securities jumped to 767.9 billion dollars in March from 744.2 billion dollars the previous month, according to US Treasury data.
The figure does not include those of Hong Kong, China’s special administration region, which climbed to 78.9 billion dollars from 76.3 billion dollars.
7 Stock rally stalls as investors await new catalyst
By STEPHEN BERNARD, AP Business Writer
Sun May 17, 9:30 pm ET
|NEW YORK – The stock market has run out of reasons to rally, at least for now.
After a two-month surge that saw the Dow Jones industrials average soar 31 percent and the Standard & Poor’s 500 index shoot up 37 percent, investors gave up some of those gains last week. As the new week begins, there doesn’t seem to be any catalysts that could restart the rally.
The market barreled higher as investors realized that worst-case scenarios in the banking industry weren’t going to happen. Indications that the recession was slowing also gave investors reason to buy at a pace not seen in decades.
8 Court case reveals ugly infighting at Motorola
By PETER SVENSSON, AP Technology Writer
Sun May 17, 3:35 pm ET
|It’s a white-collar worker’s nightmare: giving a presentation that gets you fired.
It happened to the chief financial officer of Motorola Inc. this year. And the lawsuit he filed afterward provides a rare peek into dysfunctional relationships at the top of a major company.
Motorola has gone so far as to claim it fired the CFO “for cause” – a term often reserved for suspected embezzlers – while the former executive says he was canned for blowing the whistle on big problems.
9 Anatomy of an economic meltdown
By MIKE BAKER and MIKE SCHNEIDER, Associated Press Writers
Sun May 17, 11:36 am ET
|How did it get this bad?
For two years, economic turmoil in the United States throbbed from a few areas of isolated distress – dark bruises on a national map that was otherwise unscarred.
Even the deflating housing bubble was confined mostly to areas like California’s inland valleys, Las Vegas and Florida, while manufacturing communities in Michigan and the South struggled to keep workers in their jobs. The Associated Press Economic Stress Map, a new snapshot of our national pain, shows that the economy was hurting, but it didn’t demand a nationwide lifestyle adjustment.
10 Retailers, service cos. gain as people stay home
By LISA CORNWELL, Associated Press Writer
Sun May 17, 12:51 pm ET
|CINCINNATI – As Americans grow accustomed during the recession to spending more time at home and living in the same places longer, home-improvement companies are regaining momentum.
“My wife and I had thought of this as more of an in-between house,” said Scott Nichols, 50, who had considered moving from his suburban Cincinnati home to a condo or ranch-style house. “Now we have decided to concentrate on making our current home exactly like we want it, pay it off and stay.”
An insurance marketer who lives in Union Township, Ohio, Nichols hired a handyman service to knock out a wall between his kitchen and family room to make home entertaining easier.
11 Towns find obstacles to saying ‘I do’ to mergers
By DAVID PORTER, Associated Press Writer
Sun May 17, 5:19 am ET
|CHESTER, N.J. – It’s a response to the recession and dwindling state aid that seems deceptively logical: Neighboring towns can merge into one to streamline services and save money.
Problem is, it’s rarely done, though the concept is being studied in many states, including New Jersey. But to make it work, towns have to be willing to reduce staff and services, and they risk losing their identities and their independence – and few seem to be willing to do that.
In Utah, officials have discussed making one city out of five towns north of Salt Lake City, and the eastern Massachusetts towns of Hamilton and Wenham have studied a merger. In Idaho, a proposed union of the resort towns of Ketchum and Sun Valley was scrapped last month after strong resistance from residents of Sun Valley, a world-renowned ski resort.
12 Navajos largely unscathed by recession
By FELICIA FONSECA, Associated Press Writer
Sun May 17, 5:36 am ET
|TONALEA, Ariz. – Talk at the community center in this small Navajo town isn’t as focused on the economy as it is in many places off the reservation.
That’s because the people living on the largest American Indian reservation have been largely unscathed by the recession.
Most Navajos own their own homes, tend not to invest in the stock market and have long had difficulties borrowing money, distinguishing them from millions of other Americans who’ve suffered from rising mortgage payments, sinking 401(k) retirement accounts and stricter terms from lenders.
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13 WTC emergency drill evokes memories of Sept. 11
By KAREN MATTHEWS, Associated Press Writer
Sun May 17, 4:46 pm ET
|NEW YORK – It was an emergency drill, yet the scene of hundreds of firefighters, police officers and other first responders hustling around the World Trade Center site Sunday evoked the aftermath of the Sept. 11 attacks.
Firefighters carried oxygen tanks, hoses and heavy axes into an underground train station, while police and other emergency personnel helped those playing injured – all part of a large disaster response exercise at ground zero.
More than 800 first responders participated in Sunday’s mock terrorist attack, which simulated an explosion on a New Jersey-bound PATH commuter train in a tunnel. The police, firefighters and other emergency personnel joined about 150 volunteers, who posed as injured passengers smudged with grime and fake blood.
14 More colleges generate sweat electricity in gym
By JEFF BARNARD, AP Environmental Writer
Sun May 17, 3:22 pm ET
|EUGENE, Ore. – As she pedaled an elliptical exercise machine at the University of Oregon, Wen Lee’s face lit up like the light bulbs she was powering.
“I could run my television with this,” the environmental studies graduate student said between breaths, making the three bulbs on the stand in front of her glow brighter as part of a demonstration of renewable people power.
The University of Oregon – one of its school colors is, after all, green – is the latest in a growing number of college campuses and exercise clubs across the country where workouts produce watts.
15 Nearly 40 protesters arrested at Notre Dame
By TOM COYNE, Associated Press Writer
Sun May 17, 7:30 pm ET
|SOUTH BEND, Ind. – Nearly 40 people were arrested Sunday as they tried to enter the University of Notre Dame to protest President Barack Obama’s appearance at commencement, police said.
At least 39 people were taken into custody on trespassing charges, police Sgt. Bill Redman said. Among those arrested were Norma McCorvey, the plaintiff identified as “Roe” in the Roe v. Wade Supreme Court decision that legalized abortion. She now opposes abortion.
Obama’s commencement speech capped weeks of protests at the nation’s most prominent Roman Catholic university. Critics have condemned the university’s decision to invite Obama, who supports abortion rights and embryonic stem-cell research, and some have called for the resignation of the Rev. John Jenkins, the university’s president.
16 US scholars planning Islamic college
By RACHEL ZOLL, AP Religion Writer
Sun May 17, 1:37 pm ET
|PLAINSBORO, N.J. – A group of American Muslims, led by two prominent scholars, is moving closer to fulfilling a vision of founding the first four-year accredited Islamic college in the United States, what some are calling a “Muslim Georgetown.”
Advisers to the project have scheduled a June vote to decide whether the proposed Zaytuna College can open in the fall of next year, a major step toward developing the faith in America.
Imam Zaid Shakir and Sheik Hamza Yusuf of California have spent years planning the school, which will offer a liberal arts education and training in Islamic scholarship. Shakir, a California native, sees the school in the tradition of other religious groups that formed universities to educate leaders and carve a space in the mainstream of American life.
17 Astronauts revive Hubble imaging device
By Irene Klotz, Reuters
1 hr 27 mins ago
|HOUSTON (Reuters) – Space shuttle Atlantis astronauts on Sunday repaired a failed instrument on the Hubble Space Telescope used to discover black holes and other galactic phenomena following a tedious spacewalk mired by equipment glitches.
Like Hubble’s advanced camera, which was rewired during a spacewalk on Saturday, the Space Telescope Imaging Spectrograph was not designed to be overhauled in space.
The device, known by the acronym STIS, splits light into its component wavelengths. It was shut down in 2004 after electronics problems cut off its power.
18 Vulture buyers to circle U.S. shopping center confab
By Ilaina Jonas, Reuters
Sun May 17, 1:23 pm ET
|NEW YORK (Reuters) – U.S. shopping center and mall owners can expect to see a lot of vultures circling this year’s International Council of Shopping Centers convention in Las Vegas.
Vulture buyers, who thrive on distress, are expected in greater numbers this year looking to swoop down on a strip mall, shopping center or regional mall that might be making money, but whose owner overpaid or cannot find new financing.
“I think it’s probably the worst mood we’ve had and I’ve been doing this for 30 years,” said Gerry Mason, managing director of Savills LLC, a division of Savills Plc, the world’s third-largest real estate services company.
19 Clouds on horizon for "American Idol" juggernaut?
By Alex Dobuzinskis, Reuters
Sun May 17, 1:11 pm ET
|LOS ANGELES (Reuters Life!) – “American Idol” reaches its climax this week, still ruling the roost on U.S. television after eight seasons, but the battle of the songsters faces declining audiences and limits to its viewer-driven format.
The finale showdown on Tuesday pits musical theater star Adam Lambert, whom Entertainment Weekly magazine called “the most exciting ‘American Idol’ contestant in years,” against college student Kris Allen, a favorite among teenage girls.
What started as a cheesy summer show in 2002 has mushroomed into a cultural phenomenon and an estimated $1 billion-plus brand spanning everything from ice-cream and trading cards to an attraction at Walt Disney World Resort.
20 U.S. gun owners wary of Obama at NRA convention
By Tim Gaynor, Reuters
Fri May 15, 2:44 pm ET
|PHOENIX (Reuters) – Thousands of U.S. gun owners gathering in Phoenix for the National Rifle Association’s convention have one target firmly in their sights: any attempt to curb gun rights by the new guys in Washington.
“We as an association, but more importantly America’s 80 million gun owners, are very concerned about what may be coming down the pike through the Obama administration,” Glen Caroline, grassroots director for the NRA’s lobbying arm.
The NRA is one of the most powerful lobbying groups in the country, with a long record of campaigning hard for gun rights sheltered by the U.S. Constitution. It has nearly 4 million members, 60,000 of whom were expected to attend the three-day event that began on Friday.
21 U.S. credit card defaults keep rising in April
By Juan Lagorio, Reuters
Fri May 15, 1:59 pm ET
|NEW YORK (Reuters) – U.S. credit card defaults rose in April to record highs, with Citigroup and Wells Fargo posting double digit loss rates, as the recession slashed more than 2 million jobs since the beginning of the year.
“U.S. card credit quality continues to struggle,” John Williams, an analyst at Macquarie Research, said in a note to clients.
In March, investors gained confidence in the industry after American Express Co reported better-than-expected credit card default rates, suggesting cardholders’ ability to pay bills could be stabilizing.