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Bush's big gift to Wal-Mart
How are Americans likely to spend their tax rebates? Expect sellers of food and clothing, such as Wal-Mart, Kohl's and Target, to be the biggest beneficiaries.

Latest Market Update
February 08, 2008 -- 16:30 ET
[BRIEFING.COM] The stock market finished down today, extending the week's decline to 4.6%. Seven of the ten economic sectors finished in negative territory. Still, a strong showing by tech stocks was unable to offset the subprime pressures... More


Politicians know how to do one thing well: hand out money.

With a possible recession looming, politicos in Washington, D.C., are rushing through a tax-rebate package twice as big as any cash giveaway in the past four decades.

Which companies should expect a slice of this $100 billion pie? Though a $1,200 check may bring sellers of flat-screen TVs to mind, history shows most Americans are likely to spend the largest chunk on basics such as food and clothing.

That's good news for Wal-Mart Stores (WMT, news, msgs), the nation's largest retailer, and others like Target (TGT, news, msgs) and Kohl's (KSS, news, msgs).

Lower-end retailers like these, along with restaurants, could get a $66 billion revenue boost in the third and fourth quarters if past consumer behavior is any guide. Wal-Mart alone could see $4 billion to $5 billion from the rebates in just the third quarter.

The push is on
President Bush is pressing for fast action, but Congress still has to agree on a plan.

The key House plan would offer rebates of up to $600 for individuals and $1,200 for couples who filed tax returns jointly, plus $300 per child. The rebates would be phased out for individuals with adjusted gross incomes of more than $75,000 and couples with more than $150,000. The theory: People who earn less are more likely to spend it and help the economy.

Economic Uncertainty Contributes To Mixed Close On Wall Street
Friday February 08, 2008 16:39:00 EST

(RTTNews) - Stocks ended Friday's trading in a mixed fashion, as they had been for most of the day. The Nasdaq outperformed the Dow and the S&P 500, boosted by positive news from Amazon.com (AMZN), which announced that its board authorized the repurchase of up to $1 billion worth of its common stock.


Financial stocks helped to pull the Dow and the S&P 500 lower, weighed down by bond insurers. On Thursday, Moody's said it is reviewing the ratings of multiple mortgage insurers and has placed negative outlooks on others.


Additionally, the markets were affected by speeches from key members of the Federal Reserve. San Francisco Federal Reserve Bank President Janet Yellen suggested that sluggish economic growth is likely, keeping the door open for further rate cuts, while Federal Reserve Bank of Atlanta President Dennis Lockhart spoke for a second time in two days, giving a somewhat positive economic outlook.


The major averages ended the session on a downtick, but they remained well of their lows for the session. The Nasdaq managed to close in positive territory, while the Dow and S&P 500 ended the day below the unchanged line. The Nasdaq closed up 11.82 points or 0.5 percent at 2,305.85 while the Dow closed down 64.87 points or 0.5 percent at 12,182.13 and the S&P 500 closed down 5.62 points or 0.4 percent at 1,331.29.


In overseas trading, most Asian markets remained closed for public holidays on Friday, and the few that were open turned in a mixed performance. The major European closed mix as well, with the U.K.'s FTSE 100 index closing up 1.1 percent.


Meanwhile, treasuries traded in a range for most of the afternoon, hovering near their highs for the day. Subsequently, the benchmark ten-year yield ended the day down 8.2 basis points at 3.654 percent.


Real estate stocks saw some of the worst declines, with the Morgan Stanly REIT Index falling 3.3 percent. The index gave up its gain from the previous session, closing at a nearly two-week low.


Health insurance stocks also saw significant selling pressure after Aetna (AET) and Coventry Health Care (CVH) disappointed analysts with their forecasts. The Morgan Stanley Healthcare Payor Index dropped 2.6 percent, extending its substantial downtrend. The index set a five-month closing low.


Within the health insurance sector, Centene (CNC) was one of the biggest losers. The stock fell 13.2 percent after the company reported disappointing fourth-quarter earnings, setting a four-month closing low.


Bank, housing, drug and biotech stocks saw sharp declines as well. The KBW Bank Index fell 2.5 percent.


On the other hand, gold stocks saw significant buying interest, boosted by a $12 an ounce increase in the precious metal. The Amex Gold Bugs Index ended the day up 3.6 percent. Other resource stocks also saw sharp gains, including oil, natural gas, chemical and steel stocks.

McDonald's Jan. Comps Up 5.7% On Strong Overseas Sales; Systemwide Sales Up 13.4% -
Friday February 08, 2008 09:28:00 EST

(RTTNews) - Oak Brook, Illinois-based foodservice retailer McDonald's Corp. (MCD) on Friday reported a 5.7% rise in January comparable sales, on top of a 4.9% growth last year, driven mainly by strong sales increases in overseas markets. Systemwide sales for worldwide restaurants increased 13.4% in January, while the growth was 7.1% in constant currencies.


Commenting on the performance, Chief Executive Officer Jim Skinner said, "We continue to drive our business with an unwavering commitment to our customers. Consumers are busier than ever, and McDonald's is their ideal choice for quick, convenient and affordable meals."


Comparable sales represent sales at all restaurants in operation at least thirteen months, while systemwide sales include sales at all restaurants, including those operated by the company, franchisees and affiliates.


In January, U.S. comparable sales rose 1.9%, driven by the ongoing strength of its breakfast business combined with the everyday appeal of McDonald's Dollar Menu. In the prior year period, comparable sales in the region increased 3.6%. Systemwide sales in U.S. grew 2.8% from last year.


Earlier, Jim Skinner had said that the company expects U.S. comparable sales to rise 1.5% in January, with the estimation that the current U.S. economic environment would cut same-store sales by 1 percentage point to 2 percentage points.


The company's December comparable sales in the U.S. region remained flat with last year on severe winter weather and softer consumer spending.


In Europe, January comparable sales increased 8.2% atop a 6.8% increase in the previous year, helped by positive comparable sales in every market, mainly France, Germany and the U.K. In the region, monthly systemwide sales climbed 21.7% from the previous year, while the growth was 9.9% at constant currency. The company pointed out that its unique premium and value products continue to give satisfaction to its customers.


In Asia/Pacific, Middle East and Africa, or APMEA region, January comparable sales increased 7.8% on top of a 4.3% rise last year, as locally relevant menu options and extended operating hours drove strong performance in Australia, China and many other markets. Systemwide sales climbed 21% on a reported basis, and 10.3% at constant currency.


The company anticipated 8%- 9% increase in comparable sales in Europe for January and a 6% - 7% increase in APMEA region.


McDonald's, with more than 30,000 local restaurants in more than 100 countries, noted that in January 2008, the calendar shift/trading day adjustment resulted in one additional Thursday and one less Monday compared with January 2007.


McDonald's said it tentatively plans to release February sales on March 10, 2008.


Earlier on January 28, McDonald's reported a 3% increase in its fourth quarter profit, helped by growth in comparable store sales and tax benefits. The Dow component posted fourth quarter net income of $1.27 billion or $1.06 per share, higher than $1.24 billion or $1 per share last year. Fourth-quarter income from continuing operations surged to $1.27 billion or $1.06 per share from $751.7 million or $0.61 per share a year ago. Excluding items, McDonald's earned $0.73 per share in the most recent quarter. Revenues for the quarter rose 6% to $5.75 billion from $5.45 billion last year. Comparable sales increased 6.7% in fourth quarter, compared to 6.3% rise last year.


McDonald's then noted that its lower pricing and expanded menu helped it to overcome the crisis created by consumers who have reduced their spending due to weak economy and rising fuel costs.


Fast-food giant Yum! Brands Inc. (YUM) in early February reported that worldwide same-store sales in the fourth quarter grew 4%, including 17% growth in mainland China, 5% rise in the international division and 1% growth in the U.S.


MCD closed Thursday's regular trading session at $54.46, up $0.73, on a volume of 11.2 million shares. In the pre-market activity, shares edged up $0.54 or 0.99% to $55.00.

Crude is the only disappointment of the week. The rest are inline.
Thanks Rakesh for all the info.

Regards,
Kalyan.

Market turmoil wipes off USD 100 bn from investors` wealth

Mumbai, Feb 10: Barely 40 days into the New Year and India Inc has seen its market value eroded by more than Rs 4,00,000 crore amid turbulent stock market conditions.

Interestingly, the country`s 30 blue-chip companies, which constitute the market`s benchmark Sensex, account for nearly the entire loss.

According to the latest data available with the Bombay Stock Exchange, the total market capitalisation of all the companies listed there currently stands at Rs 57,53,230 crore.

This represents a loss of Rs 4,16,755 crore from the level it stood at as of December 31, 2007 -- the last trading day of the previous year, when it stood at Rs 71,69,985 crore.

In the US currency, the loss amounts to about USD 110 billion, bringing the total market cap to close to USD 1.7 trillion.

While the market traded on a relatively stronger note during the first few days of the year, the latter half of January saw the stocks plummeting, tracking the weak worldwide cues.

Sensex down 62 pts on inflation concerns

Mumbai, Feb 08: The markets continued its losing streak for the third day in a row with the Bombay Stock Exchange benchmark Sensex losing over 60 points to end at 17,464.89, its third lowest closing level in 2008, on reports of inflation rate rising to above 4 per cent.

Today`s trading was marked by selective buying and selling by investors with IT and FMCG counters attracting good buying support, while consumer durable, banking, metal, realty and capital goods suffering a sharp setback on heavy selling.

Mirroring a firm trend on the Wall Street last night, the 30-share BSE barometer resumed higher at 17,610.07 and touched a high of 17,688.73.

But the emergence of heavy selling pulled the Sensex down to a low of 17,203.06 before recovering some ground on positive opening in European markets.

The index closed the day at 17,464.89, a fall of 62.04 points, or 0.35 per cent over from its last close.

While the BSE barometer had lost more than 1,100 points in the last two trading sessions, today close at 17,464.89 points marks its third lowest closing level in this year.

Earlier on January 22, the Sensex had tumbled to 16,729.94 by more than 1400 points on weak global cues. It recorded its another lowest level on two days later on January 24 at 17,221.74.

The broad-based S&P CNX Nifty of the National Stock Exchange also declined by 12.90 points, or 0.25 per cent, to finish the day at 5,120.35 from previous close of 5,133.25.

Brokers said projection of a moderation in GDP growth from 9.6 per cent last fiscal to 8.7 per cent this year compelled operators and retail investors to book profits even today at the current lower levels.

Reliance Retail gets one loyal customer on every square foot

New Delhi, Feb 10: Mukesh Ambani-led Reliance group's retail juggernaut seems to be gaining scale uninterrupted, despite hiccups like political protests, going by the success of its customer loyalty programme.

Reliance Retail, within the four months of rolling out its first store in November 2007, has touched an outlet base of 500 stores in various formats, spanning three million square foot of occupied space in various cities.

This expansion of the retail space has been achieved alongside the company's customer loyalty programme -- Reliance One -- which has also touched a membership base of three million customers.

The average of one loyal customer per every square foot of retail space is probably the highest and fastest loyalty programme amongst all the retail companies in India, according to industry people who did not wish to be identified.

Reliance Retail, a 100% subsidiary of the country's most valued firm Reliance Industries Ltd, is targeting to make its loyalty programme one of the top 10 loyalty card base in the worldwide retail sector by 2012.

Reliance One, a pre-paid facility which allows customers to start using it right from the point of purchase, is valid across all the nine different formats of Reliance Retail stores.

Building on the success of Reliance One, the company is also seeking to become "the distributor of choice" for all financial services companies with an all-India footprint at every product level, said an industry source.

SBI life to pump in Rs 300 cr for expansion plan

Chandigarh, Feb 09: In a bid to deepen market penetration, SBI life insurance will infuse Rs 300 crore of capital within next two months for funding its expansion plans which entails opening new offices and hiring more insurance advisors.

Besides, the company is also expecting robust growth of over 100 percent in its total premium collection at Rs 6,500 crore by the end of current fiscal against premium income of Rs 2,928 crore in 2006-07.

"We have already invested Rs 100 crore during this fiscal on our business operations and now we are going to invest Rs 300 crore more by March 31, 2008 which will be primarily for funding our expansion programmes," SBI life insurance Managing Director and CEO Uday Sankar Roy told reporters here today.

The company, which is a joint venture between SBI and Cardif, a BNP Paribas company, has plans to double the strength of its insurance advisors from 35,000 at present to 70,000 agents. It has also decided to double the company's owned branches from 186 at present within one year, he said.

Riding high with over 100 percent growth in business volume last year, the company is keen to maintain the same this year also. "We have collected total premium to the tune of Rs 3,000 crore up till January 31, 2008 and by March 31, we expect to collect Rs 6,500 crore as majority of business is expected in last two months of the fiscal," he said.

Roy further said that during this year, the company would cover 77 lakh people by March 2008 as compared to 62 Lakh lives covered in 2006-07.

To a query, Roy said SBI life would also think of launching insurance cover for NRI. "We will certainly look at it as there is potential which needs to be tapped in view of large presence of Indian diaspora in many countries," he said.

The northern region comprising Punjab, Haryana, Himachal Pradesh and Jammu & Kashmir has posted a growth of 200 percent in total premium collection at Rs 323 crore so far as compared to Rs 96 crore received corresponding period of last year. Out of which, Punjab has maximum share of 60 percent in total premium collection.

Govt confident about REC IPO

New Delhi, Feb 08: Unfazed by the turbulent market conditions taking a toll on IPOs of Emaar MGF and Wockhardt, the government on Friday said it is confident about the success of the upcoming initial offer of state-run REC, just like those of other power sector PSUS.

Power secretary Anil Razdan said the meltdown in the market would not have any bearing on the public offer of rural electrification corp, which expects to list on the bourses by third week of March.

"Public wants a steady and stable player. REC is a strong player in the power sector since 1969. The market needs companies like REC with proven track record," he said.

REC Chairman and Managing Director Lakhina said: "there is a problem in the market. Wockhardt has withdrawn. Emaar MGF is still throttled. I am confident because this company is so strong and its track record is impressive."

The REC IPO opens on 19th of this month. "We are hoping to list on the bourses by third week of March," he said.

Real estate developer emaar MGF and health care services provider Wockhardt have withdrawn their respective issues following poor response.

While Wockhardt was subscribed only 19.5%, the issue of Emaar garnered interest for only 43% of the issue offered.

Lakhina said REC has been growing at a rate of over 25% and aims to maintain the same rate going ahead.

Through the IPO, REC will offer 15.61 crore shares, which include about 39 lakh shares reserved for the employees.

Rec would offload 18.81% equity through the issue. The company is third power PSU to bring out an IPO after PFC and PGCIL got listed last year.

FM may ask banks to raise credit, lower interest rates

New Delhi, Feb 10: With economic growth likely to slow down to 8.7% this fiscal, public sector bank heads are expected to come under pressure from Finance Minister P Chidambaram when he meets them on Tuesday to raise lending to the manufacturing sector and cut interest rates.

"Some public sector banks have already reduced interest rates, but other banks should also bring down interest rates considering there is ample liquidity in the system and deposit rates have come down," official sources said.

They said the meeting is likely to focus on "banks` role to meet budget targets, their performance apart from credit quality and delivery to the target sectors".

The meeting assumes significance as it comes on the heels of the Reserve Bank maintaining status quo in key rates.

The Finance Minister, who met RBI Governor Y V Reddy on Saturday, is believed to have discussed measures to moderate the possible rise in capital inflows besides steps to raise credit to the productive sectors and for consumer goods to ensure better GDP figures in the fourth quarter.

According to advance estimates by Central Statistical Organisation, manufacturing output growth is expected to slow down to 9.4% this fiscal against 12% in FY`07.

Among other industrial activities, construction is likely to grow by 9.6% against 12% last fiscal.

These issues are also likely to be raised in the meeting with bank heads.