Breaking News & Stocks

Stocks Rebound From Sharp Sell-Off; Philadelphia-Area Manufacturing Reading Boosts Confidence
NEW YORK (AP) -- Wall Street capped a volatile week with a big advance Thursday, rebounding from a steep sell-off as investors sought bargains and cheered a milder-than-expected drop in a regional manufacturing report.The Dow Jones industrial average rose about 260 points Thursday, giving the blue chips a gain of more than 3 percent for the week, while broader indexes finished the week with gains of 2 percent to 3 percent. The markets are closed for Good Friday.

Besides the manufacturing reading from the Philadelphia Federal Reserve, a plunge in commodities prices gave investors some hope that lower energy and food prices might boost consumers' discretionary spending and ease inflation concerns. Crude oil fell, while gold prices declined sharply.

Stocks had wobbled in the early going Thursday after the Labor Department said the number of newly laid off workers filing for unemployment benefits rose last week by a more-than-anticipated 22,000 to 378,000. That level is the highest in nearly two months.

But Wall Street found reason to buy back into stocks when the Philadelphia Fed said manufacturing activity is dropping in March by less than it did in February, and by less than many economists anticipated.

Investors appeared relieved about the report, but economic jitters are far from alleviated. On top of the disappointing jobless claims report, the Conference Board said Thursday that its index of leading economic indicators fell, as expected, for the fifth straight month in February.

The markets are apt to stay volatile for some time, as investors digest news on the economy and the troubled financial sector.

"It's the every-other-day theory -- up one day, and down the next," said Scott Brown, chief economist at Raymond James & Associates.

According to preliminary calculations, the Dow rose 261.66, or 2.16 percent, to 12,361.32.

Broader stock indicators also advanced. The Standard & Poor's 500 index rose 31.09, or 2.39 percent, to 1,329.51, and the Nasdaq composite index rose 48.15, or 2.18 percent, to 2,258.11.

Bond prices rose Thursday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.34 percent from 3.41 percent late Wednesday.

Light, sweet crude fell 70 cents to settle at $101.84 on the New York Mercantile Exchange. Gold fell $33, or 3.5 percent, to $912.3 an ounce, while the dollar was mixed against other major currencies.

Todd Salamone, director of trading for Schaeffer's Investment Research in Cincinnati, said investors appeared somewhat optimistic.

"There's some belief out there that the worst is behind us, but that's not necessarily written in stone," he said. "You're getting a strong bid in financials and housing stocks -- sectors that have been the cause for the jitters."

Shares in energy and metals companies were mixed. ConocoPhillips rose $1.22 to $74.83; Barrick Gold Corp. fell $3.25, or 7.2 percent, to $42; and Newmont Mining Corp. fell $2.75, or 5.6 percent, to $45.97.

In earnings news, Nike Inc. reported late Wednesday a 30 percent gain in quarterly profit, signaling to Wall Street that some companies are faring well despite the credit crisis. Nike said sales overseas increased largely because of the weak dollar. Nike rose $5.44, or 8.8 percent, to $62.27.

In other corporate news, Borders Group Inc., which has been reporting disappointing earnings in recent quarters, revealed early Thursday it may put itself up for sale. The nation's second-largest bookseller said it has lined up $42.5 million in financing so it can continue operating. Borders fell $2.03, or 29 percent, to $5.07.

Investors faced fresh concerns about tightness in the credit markets. CIT Group Inc. fell $2.01, or 17 percent, to $9.63 after the financial-services company said it is tapping into its $7.3 billion in credit lines to repay debt and finance its commercial lending business. The company says it cannot obtain financing from other sources.

Despite the lingering credit concerns, most financial shares showed big gains. Some on Wall Street have sounded a more upbeat tone about the financial sector, particularly after JPMorgan Chase & Co. struck a deal Sunday to acquire the troubled Bear Stearns Cos., which has struggled with evaporating liquidity.

Punk, Ziegel & Co. analyst Richard Bove wrote in a research note that the financial sector's worst problems were over.

Among financials, Morgan Stanley rose $6.22, or 14 percent, to $49.67, while Citigroup Inc. rose $2.09, or 10 percent, to $22.50.

Though the week was a shortened one for Wall Street, the volatility packed into four days has made it feel much longer. Nervousness blanketed Wall Street's open Monday as investors fretted over JPMorgan's buyout of Bear Stearns at $2 a share when the stock had closed in the prior session at $30. Stocks ended mixed Monday only to soar Tuesday when the Fed cut its benchmark interest rate by 0.75 percentage point to 2.25 percent. The Dow jumped 420 points, its biggest point gain in more than five years. Then, on Wednesday renewed concerns about the financial sector punctured the gains, sending the Dow down nearly 300.

On Thursday, the Russell 2000 index of smaller companies rose 17.29, or 2.60 percent, to 681.42.

Advancing issues outnumbered decliners by about 3 to 1 on the New York Stock Exchange, where volume came to a heavy 2.77 billion shares compared with 1.97 billion shares traded Wednesday.

Stock markets overseas were mostly lower. Hong Kong's Hang Seng Index fell 3.5 percent, but the Shanghai Composite Index closed 1.1 percent higher after an early plunge. Britain's FTSE 100 closed down 0.91 percent, Germany's DAX index lost 0.65 percent, and France's CAC-40 0.49 percent.

Japan's markets were closed for a national holiday.

Oil Prices Drop on Concerns the Slowing Economy Is Cutting Demand
NEW YORK (AP) -- Oil futures extended their declines Thursday as concerns about the economy and demand for oil grew and the dollar strengthened.
Retail gas prices, meanwhile, fell further below their recent records, while diesel rose to a new record above $4 a gallon.For a second day, the oil market appeared focused on the economy and oil's underlying supply and demand fundamentals -- factors it ignored in recent weeks while rocketing to a series of new records. However, some analysts said oil's price swoon may not last for long; most investors expect the Federal Reserve to cut interest rates several more times this year, moves that are sure to put new pressure on the dollar.

Lower interest rates tend to weaken the dollar, driving investors to commodities such as oil that they view as a hedge against inflation. A lower dollar also makes oil less expensive to overseas investors -- a trend that reverses when the dollar strengthens, as it did Thursday.

But there are signs the market may be divorcing itself from its focus on the dollar. Prices were pressured Thursday when the Labor Department said the number of people filing for unemployment benefits jumped by 22,000 last week, much more than expected. A sharp slowdown in the economy could reduce demand for oil and gasoline. On Wednesday, the Energy Department said gasoline demand dropped by 1 percent last week.

Light, sweet crude for May delivery fell 70 cents to settle at $101.84 a barrel on the New York Mercantile Exchange Thursday after sliding to as low as $98.65 earlier. It was the first dip by a front-month oil contract under $100 since March 5. On Wednesday, the expiring April contract fell $4.94 a barrel to settle at $104.48.

Most financial markets in the U.S. and many other countries will be closed for Good Friday.

Oil has fallen sharply this week, dropping about 9 percent, since setting a new trading record of $111.80 on Monday.

"(Investors) seem to be coming round to the notion that the deterioration in the U.S. (economic) picture cannot be ignored on the pretext that commodities are a 'weak dollar play' or an 'inflation hedge', and thus immune from downward pressure," said Edward Meir, an analyst at MF Global UK Ltd., in a research note.

Word of an unexpected outage at a 100,000 barrel a day LyondellBasell Industries refinery in Houston, according to Dow Jones Newswires, sent gasoline futures higher Thursday, pulling oil off its earlier lows. April gasoline futures rose 4.48 cents to settle at $2.6051 a gallon on the Nymex. The stock market also helped oil come back from a steeper loss; Wall Street advanced after the Philadelphia Federal Reserve said manufacturing activity in its region is falling by less this month than it did in February.

At the pump, meanwhile, the national average price of a gallon of gas slipped by 0.4 cent overnight to $3.275, according to AAA and the Oil Price Information Service. Gas prices followed oil to a number of recent records, but have retreated slightly over the past several days as oil has wavered.

Diesel prices, however, rose 0.8 cent to a new record of $4.033 a gallon Thursday. Diesel followed oil's recent surge, but also faces a different demand dynamic. While U.S. demand for oil and gasoline are tepid, diesel is more tied to the global economy, where demand is growing. Diesel is used to transport the vast majority of the world's goods via rail, truck and ship.

High gas prices are adding to the burdens of American families already facing higher food prices and falling home values. High diesel prices are hurting shipping firms, and pushing up prices of everything else.

If oil prices fall, some of those pressures on U.S. consumers and businesses could ease. But not everyone believes oil prices have begun a long-expected decline.

"We think this is just a correction in the market," said James Cordier, founder of OptionSellers.com, a Tampa, Fla., trading firm.

In other Nymex trading Thursday, April heating oil futures slipped by 3.95 cents to settle at $2.9772 a gallon while April natural gas futures rose 4.1 cents to settle at $9.065 per 1,000 cubic feet. The Energy Department said gas inventories fell by 85 billion cubic feet last week, in line with analysts expectations.

In London, Brent crude futures dropped 34 cents to settle at $100.38 a barrel on the ICE Futures exchange.

MS releases first Vista service pack

San Francisco, March 20: Microsoft released its first major update to its Windows Vista operating system Wednesday, prompting a flood of complaints from users who said the service pack fouled up their computers.

Microsoft made the free update available via its Windows Update website and said the software improved the stability, security and performance of the Vista. However it also warned that the service pack could clash with some security software and other programs customers may have installed on their machine.

Numerous people who downloaded the software pack complained that it had interfered with the smooth operation of their computers. Reported troubles ranged from a simple inability to download the software from Microsoft's Windows Update site to sudden spikes in memory usage.

'I downloaded it via Windows Update, and got a blue screen on the third part of the update,' wrote 'Iggy33' in a comment posted Wednesday on Microsoft's Vista team blog.

'SeppDietrich' said the update had uninstalled all his Nvidia drivers while 'Bikkja' said that the update had drastically slowed down the computer.

The reactions matched the initial criticism incurred by Microsoft when it first released Vista. Corporate and home users complained about its resource requirements and its lack of compatibility with existing applications.

Vista SP1 was released initially in only five languages - English, French, Spanish, German, and Japanese. Another 31 languages will follow in mid-April when the software will be distributed to those users signed on for Microsoft's automatic updates.

Microsoft recommends that Vista users go to Windows Update to get the service pack rather than use its download service, saying that the Windows Update could diagnose driver problems before installation.

SBI`s first Saudi branch to open in Jeddah

Dubai, March 21: State Bank of India, which got a licence from Saudi Arabian Monetary Agency (SAMA) last year to open its full-fledged branch in the kingdom, will soon operate its first branch in Jeddah.

SBI (Saudi Arabia) General Manager J Parameshwarappa has inked building lease and the first branch will be located at Al-Andalus Plaza on Sitteen Street in Jeddah.

With this, the bank has taken an important step of identifying premises for its operation in the kingdom and would start functioning from here once it is ready in all respects, Parameshwarappa told Arab news.

In recent years, the bank sought to expand its overseas operations by buying foreign banks, launching new products and services for foreigners and Indian diaspora as well as by opening new branches in different countries including the Gulf states.

The bank`s branch here will go a long way in meeting the requirements of businessmen in general and Indian expatriates in particular. The businessmen`s need in the rapidly growing trade relations between Saudi Arabia and India, and the bank`s speed remittance system are seen as its prime attraction.

The Indian community has welcomed the SBI branch in Jeddah

Sensex turning sexier for women investors?
21 Mar, 2008, 1800 hrs IST,Krishna Narayan Das.......................

It is hard to fathom a day when an Ekta Kapoor soap would be less talked about than stock market fall or rise stories in an all women gossip session. But the fact of the matter is that more and more women are now finding the once 'bastion of men' very attractive, or at-least, worth talking about.

It is not that only now women are getting into the lure of fast bucks. Easy money (read fast bucks) has always attracted men and women alike. But the fact that stock markets were seen as something that only guys with thorough knowledge could deal in had helped in keeping the fairer sex away.

However, things are changing gradually. It is evident from the fact that brokerage firms are now looking at all women branches. Geojit Financial Services Limited, a pioneer in this regard, already has three such all women branches in Mumbai, Chennai and Kochi.

According to some estimates, six in every hundred investors are women now. Undoubtedly, India's growth story is a factor in that, but is that all?

Ajinder Pal Singh, branch manager at the Janakpuri branch of Karvy Stock Broking, a domestic brokerage firm feels that media has played a very important role in making stocks a much more attractive investment option for women, "Thanks to exclusive 24 hour business channels, housewives now have the option of listening to analysts live on TV and accordingly trade online. Women also feel empowered by the easy accessibility of research material on the net. Though I can't give you the exact figures, we have definitely seen a surge in the number of women who express desire and seek our services for investing into the markets."

Traditionally women are looked at as more conservative and hence it is supposed that they would not be going for high risk stocks. Surprisingly, this has not been the case, claims Singh of Karvy, "No matter what the sex of the investor is, he or she realizes that investing in markets is a 'no pain no gain' affair. We have been advising many women investors and most of them are ready to take some risks for some quick bucks"

It is also a fact that women look at investments that can easily be liquidated. They prefer stocks as it gives them the liberty of quitting as and when they desire.

Mayuri Arafat, a resident of Janakapuri says she looks at stocks which can give her return of 5 to 10%, "I prefer not to invest in real estate and other options as they can't be easily liquidated. I have been investing in the markets for quite some time now and have a fair enough idea of what is in store. As I don't put in much money, volatility hardly makes much of a difference."

When asked what advantages a woman investor has over her male counterpart, Mrs Arafat says, "The fact that we don't shy away from asking questions does help us in making sound investment decisions. We also think long term and that, to a large extent, insulates us from market fall."

However, despite the positive outlook, Sumit Kumar of Geojit Financial Limited does not buy the idea that women investors are making big strides in Indian markets. The Relations Officer in Geojit's West Delhi branch just says that women are getting more 'market literate' but that has not been converted into numbers.

So, is the 'rising woman investor' in India just a myth or reality? Well, we'll have to wait and watch. But one thing is for sure that Sensex, after all, is not that unsexy.

Axis Bank looks to raise $315 mn through ringgit bonds
21 Mar, 2008, 0343 hrs IST.................

MUMBAI: Axis Bank is considering issuing bonds worth one billion Malaysian ringgits ($315 million) in 2008, sources said on Thursday, following the lead of State Bank of India (SBI).

Sources said Axis could issue the first tranche of 500 million ringgits in coming months, depending on market conditions. SBI sold bonds worth 500 million Malaysian ringgits earlier this week, the first Indian bank to do so. The state-run bank sold the 5-year bonds at a coupon of 4.9%, sources with knowledge of the deal said.

“The pricing was at less than 200 basis points over the six-month US dollar (London overnight inter-bank rate (Libor),” sources said, adding the issue was fully subscribed.

Sources added insurance companies took 47% of the bonds, asset managers and pension funds 43%, and banks got 10%. The Indian interest in Malaysia, which has one of the most active local corporate bond markets in Asia, comes as issuers are looking at countries perceived to be more insulated from a slowdown in the global economy.

“What we have seen in Malaysia is a market which has shown quite a lot of resilience in the face of the global volatility,” said Richard Grainger, head of debt capital markets with Barclays Capital in Hong Kong.

Low interest rates and the ringgit’s strength are important factors as well, as offshore issuers seek to diversify their funding at a time of US dollar weakness, as well as being cheaper to swap the money raised into their domestic currencies.

“While the US dollar market has been a happy home for Indian banks over the past few years in terms of their debt issuances, the market has all but closed,” Grainger said.

“Not because investors aren’t there or don’t want to buy. They are there and they do (want to buy). But the yields they are demanding are simply too high for the Indian banks to be able to issue profitably,” he said.

IPOs worth Rs 35k cr may be hit by crash’
21 Mar, 2008, 0345 hrs ...........................

NEW DELHI: The stock market meltdown may derail plans of as many as 64 companies, including Reliance Infratel, Oil India and NHPC, to enter the capital market for collectively raising about Rs 35,000 crore, a study said. “Plans of 44 IPOs, collectively planning to raise Rs 31,000 crore, which are currently awaiting Sebi approval, may be hit until the market recovers.

These include IPOs of Reliance Infratel, Mahindra Holidays, Future Ventures, Jaiprakash Power Ventures, JSW Energy, NHPC and Oil India,” Assocham co-chairman of the capital markets committee Prithvi Haldea said.

About 20 companies, including acme tele power, pride hotels and xenitis infotech, which had already received approval from market regulator sebi, have deferred their initial public offers and are now waiting for a conducive time to enter the market, according to the study jointly conducted by Assocham and Prime Database.

However, some of these 64 firms may still go ahead with their IPO plans, though at reduced valuations, even in the present market conditions, Haldea added.

At the beginning of the year, Assocham and Prime Database had estimated that companies could raise nearly Rs 60,000 crore through IPOs in 2008, subject to stable secondary market conditions.

GAIL awarded Oil & Gas Pipeline Transportation Co of the year
21 Mar, 2008, 1915 hrs IST..................................

NEW DELHI: India's leading natural gas transmission company GAIL (India) has been adjudged the Oil and Gas Transportation Company of the Year for 2006-07.

The award was presented by Petroleum Minister Murli Deora to GAIL Chairman and Managing Director U D Choubey in Mumbai today.

The award, given by Petrofed, carries a trophy and a citation, a press release said here.

GAIL owns and operates 6,700 km of natural gas transmission network, which is over 82 per cent of the total pipeline infrastructure in the country. The extensive natural gas infrastructure established over the last two decades has enabled sustained development of sizeable gas market in the country.

GAIL has a track record of operating the pipelines efficiently and maintaining high safety standards. During the year 2006-07, GAIL handled around 28 BCM of Natural Gas through its Transmission Network and currently, its market share in gas transmission is 79 per cent.

The operating performance of the pipelines operated by GAIL has been excellent in 2006-07 and 100 per cent availability of natural gas pipeline systems was maintained. GAIL has robust future plans and a road map has been developed to increase pipeline infrastructure to 11,000 km by 2011-12.

In addition to gas pipeline network, GAIL owns and operates world's longest exclusive LPG Pipeline Jamnagar-Loni pipeline (1,269 km) and another one, Vizag-Secunderabad LPG pipeline (653 km). These pipelines have efficiently substituted rail/road transportation of LPG to a large extent in the respective areas, resulting in reduction of emissions.

Gold softens but off 1-month lows; Tokyo tumbles
21 Mar, 2008, 0714 hrs IST............................

SINGAPORE: Gold dipped on Friday but held above a 1-month low hit the previous day, while Tokyo's precious metals futures tumbled amid declines in commodities markets.

Gold fell to $914.40/915.20 an ounce from $920.30/921.10 ounce late in New York and off Monday's record high of $1,030.80 an ounce.

Gold futures for April delivery on the COMEX division of the New York Mercantile Exchange fell 3.72 per cent to $915 an ounce off Monday's record of $1,033.90.

Tokyo gold and platinum futures fell by their daily limits on Friday as they played catch up with a plunge in commodities markets the previous day.

The Tokyo Commodity Exchange was closed on Thursday for a national holiday. The benchmark gold contract for February 2009 delivery fell by the 150 yen a gram limit to 3,017 yen.

US economy continues to weaken`

New York, March 21: A rise in jobless claims and a drop in a key forecasting gauge provided the latest evidence that the US economy is faltering and may be slipping into recession.

The Conference Board, a business-backed research group, said Thursday that its index of leading economic indicators fell in February for the fifth consecutive month. The index, which is designed to forecast where the nation`s economy is headed in the next three to six months, dipped 0.3 percent to 135.0 in February after slumping 0.4 percent the month before.

In Washington, meanwhile, the Labor Department said that applications for unemployment benefits totaled 378,000 last week. That was an increase of 22,000 from the previous week and the highest level in nearly two months.

The four-week average for new claims rose to 365,250, which was the highest level since a flood of claims caused by the 2005 Gulf Coast hurricanes.

Ken Goldstein, labor economist at the Conference Board, said in a statement accompanying the leading indicators report that economic signals "are flashing yellow."

He said the numbers indicate "the economy may be grinding to a halt" and that "a small contraction in economic activity cannot be ruled out."

A Federal Reserve reading of business activity in the Philadelphia area showed contraction — but not as much as analysts expected. The news helped the stock market on Thursday recover from a drop the day before.

In afternoon trading, the Dow Jones industrial average climbed 158.02, or 1.3 percent, to 12,257.68. Other indexes also were up.

The economy has been hard hit by rising gas prices, falling home prices and tightening credit markets, which have forced consumers and businesses to cut spending. As a result, the US economy may have stopped growing in the current quarter and could continue faltering in the second quarter. That would meet a technical definition of a recession — two consecutive quarters of economic contraction.

Pessimism about short-term US economic prospects was voiced by the Organization for Economic Cooperation and Development, which on Thursday downgraded its growth forecasts for the United States, the euro zone and Japan

The OECD, a Paris-based institution that supports global development, cut its forecast for first-quarter gross domestic product in the United States to 0.1 percent and predicted that GDP would be flat in the second quarter.

Like the OECD, most experts expect any downturn to be relatively mild and probably short-lived. That`s because the Federal Reserve in recent months has aggressively lowered interest rates and made more funds available to banks and brokerages. And the Bush administration has been moving on several fronts to boost the economy, including the promise of tax rebates starting in the summer.

Scott Brown, chief economist with Raymond James & Associates in St. Petersburg, Fla., predicts that US economic growth could be "close to zero, maybe negative" in the first half of the year but likely improve in the second half.

"It will take some time before the Fed rate cuts since January have an effect on the economy," Brown said. And the rebates and other fiscal stimulus are likely to kick in to boost spending this summer, he added.

The economic weakness already is showing up in higher layoffs and weaker hiring numbers.

The Labor Department`s report said the total number of payroll jobs fell by 63,000 in February, an even bigger decline that the drop of 22,000 jobs in January, which had been the first monthly decline since mid-2003.

"We have no doubt that the trend in claims is upwards and is approaching the levels seen in the earlier stage of the recession in 2001," said Ian Shepherdson, chief US economist at High Frequency Economics.

The reading for the Conference Board`s index of leading indicators was in line with the 0.3 percent decline expected by analysts surveyed by Thomson Financial/IFR.

The Conference Board said the leading index has declined 1.5 percent since August, with eight of its 10 components showing declines.

In the latest month, the biggest negative influences were unemployment insurance claims, building permits, vendor performance and consumer expectations.

The coincident index, which measures current activity, was unchanged for a third consecutive month at 124.9. The lagging index was up 0.2 percent in February after rising 0.1 percent in January.