Breaking News & Stocks

nikkei sinking - 158.49

Congress Sends Economic Aid Plan to Bush
Thursday February 7, 10:23 pm ET
By Andrew Taylor and Julie Hirschfeld Davis
Congress Send Economic Aid Plan to Bush With Tax Rebates for Many; Bush Signals Approval


WASHINGTON (AP) -- Congress, facing the prospect of an election-year recession, passed an emergency plan Thursday that rushes rebates of $600 to $1,200 to most taxpayers and $300 checks to disabled veterans, the elderly and other low-income people. President Bush indicated he would sign the measure.
ADVERTISEMENT


House passage by a 380-34 vote came a few hours after Senate leaders ended a drawn-out stalemate over the bill. Still, by congressional standards, lawmakers approved the legislation with exceptional speed to jolt the weak economy. The plan, which adds $168 billion to the deficit over two years, is intended to provide cash for people to spend and tax relief for businesses to make new investments -- boosts for an economy battered by a housing downturn and credit crunch.

Rebate checks could begin arriving in May. They would be based on 2007 tax returns, which are due April 15.

The Senate's 81-16 vote capped more than a week of political maneuvering. The logjam broke when majority Democrats dropped their demand that rescue proposal offer jobless benefits, heating aid for the poor and tax breaks for the home building and energy industries.

GOP senators blocked those ideas, but agreed to add $300 rebates for older people and disabled veterans to a $161 billion measure the House passed last week.

Bush called the bill "robust, broad-based, timely, and it will be effective." The compromise, he said in a statement after the Senate acted, was "an example of bipartisan cooperation at a time when the American people most expect it." The White House said Bush would sign the bill sometime next week.

The legislation would deliver rebates -- $600 for individuals, $1,200 for couples -- to most taxpayers, plus an additional $300 per child. Individuals making up to $75,000 a year and couples earning up to $150,000 would get the full rebate, with those making more than that or too little to owe taxes getting smaller checks.

People who paid no income taxes but earned at least $3,000 -- including through Social Security or veterans' disability benefits -- would get a $300 rebate.

"We believe the stimulus, the way it is targeted, will put money into the hands of those who will spend it immediately, injecting demand into the economy and therefore creating jobs," House Speaker Nancy Pelosi, D-Calif., told colleagues.

The measure also includes steps to boost the ailing housing market. It would temporarily raise the limit on Federal Housing Administration loans and the cap on loans that Fannie Mae and Freddie Mac can buy to $729,750.

The package was the product of a rare spate of bipartisan cooperation on Capitol Hill, where Democrats and Republicans teamed with the White House on a bill that fell far short of both parties' priorities but could draw broad consensus.

An early agreement forged by Pelosi and Minority Leader John Boehner, R-Ohio, along with Treasury Secretary Henry Paulson enjoyed a fast and smooth ride through the House, with lawmakers loath to stand in the way of a plan that could address their constituents' economic worries in advance of November's elections.

But it bogged down in the closely divided Senate, where Democrats were determined to exact a political price from Republicans by forcing them into tough votes on whether to add popular items such as $14.5 billion in jobless aid for those whose unemployment benefits have run out, $1 billion in heating aid for the poor and tax breaks for energy companies, including coal producers.

Senate Democratic leaders paired those items with rebates for older Americans and disabled veterans and threatened that Republicans would have to accept them or risk being blamed for leaving those politically powerful groups out of the stimulus plan.

In the end, though, Democrats couldn't draw enough support for their $205 billion alternative to break a GOP filibuster blocking it.

The turnaround in the Senate came after Democrats on Wednesday fell just one vote short of overcoming the Republican objections and pressing ahead with their more costly plan.

They relented Thursday and allowed a vote on a more limited proposal that included the rebates for the elderly and veterans, plus language designed to prevent illegal immigrants from getting the checks.

"I could have played around with this and tried to pick up that 60th vote, but I made a commitment to get this bill done before (Feb. 15), and we did that," said Majority Leader Harry Reid, D-Nev.

The retreat came after Pelosi sided with Republicans, including Senate Minority Leader Mitch McConnell of Kentucky, and urged the Senate to stop its infighting and pass the bill.

Thirty-three Republicans joined 46 Democrats and the Senate's two independents to pass the measure. Sixteen Republican senators voted against the plan.

The two Democratic presidential candidates, Sens. Hillary Rodham Clinton of New York and Barack Obama of Illinois, skipped the vote. The Republican front-runner, Sen. John McCain of Arizona, cast his first vote of the year on the bill, voting "yes." McCain had missed the vote the evening before.

Reid defended his decision to try to pressure Republicans on the larger proposal by offering it as a take-it-or-leave-it proposition along with the rebates for the elderly and veterans. "I feel very strongly that we did the right thing," Reid said.

Democrats said Republicans would pay a political price for their opposition.

"If today (Republicans) are squirming because they voted 'no,' that's what democracy is all about," said New York Sen. Charles Schumer, the head of the Senate Democratic Campaign Committee. "The political chips will fall where they may."

But Democratic Sen. Max Baucus of Montana, chairman of the Senate Finance Committee, said: "Discretion is the better part of valor. The best thing for us to do is declare a big victory that we've achieved; namely, getting the rebate checks to 20 million seniors and 250,000 disabled veterans."

Some Republicans expressed reservations that the rebate checks would help much. Other lawmakers worried about expanding the budget deficit.

"We have to remember that every dollar being spent on the stimulus package is being borrowed from our children. And our children's children," said Sen. Judd Gregg, R-N.H., who voted against the bill.

Senate, House Pass Economic Stimulus Package
Thursday February 07, 2008 20:27:00 EST

(RTTNews) - The United States House of Representatives on Thursday evening passed an amended economic stimulus package worth $168 billion that had been ratified in the Senate less than four hours earlier.


The bill now goes for final approval from President George W. Bush, who indicated earlier in the day that he would support the legislation.


"The Senate amended that bill in ways I can support," Bush said Thursday in a statement released by the White House.


As originally conceived by the Bush administration and the House of Representatives, the package was to provide everyone earning a paycheck with a one-time rebate check of at least $300. Income-tax payers would receive as much as $600, while couples would receive $1,200 plus another $300 for each child. The Senate proposal raises the cap on individual eligibility from $75,000 to $150,000, and for couples from $150,000 to $300,000.


After the House passed the original bill last week, the Senate tried on Wednesday to add measures for aid to senior citizens and disabled veterans while also extending unemployment benefits. A compromise was reached Thursday when aid for seniors and disabled veterans was officially added to the measure, while the unemployment benefits were not.


U.S. Treasury Secretary Henry Paulson said that work would begin immediately on the plan. The first checks would be distributed by early May, with all of the money being dispersed by the end of summer.


"Today's agreement will speed rebate checks to the overwhelming majority of Americans, giving them needed tax relief," said Senator Max Baucus, a Democrat from Montana, the chairman of the Senate Finance Committee.


In addition to providing $600-per-person rebate checks to most individual taxpayers, the Senate plan would give low-income seniors and those who collect federal disability payments $500 per person. The legislation has provisions to prevent undocumented immigrants from receiving tax rebates.


The bill also doubles the amount of equipment costs a small business can write-off on federal taxes in the first year to $250,000, and allows 50 percent bonus depreciation for businesses that buy major equipment.


Democrats had sought to boost unemployment and food stamp benefits, home heating subsidies, and new tax refunds for coal producers but those proposals were jettisoned amid Republican opposition.


Additionally, House Democrats had sought to include tax breaks for renewable energy as a part of the economic stimulus proposal.


"It's not everything we want," said Senator Charles Schumer, a New York Democrat. "Should we have included more? Of course. Republicans blocked that. But it's still a very good package and we feel very good about it."

nikkei225 -174.80 still weak.

Morgan Stanley To Launch India Fund After Fourteen-year Break - Update
Thursday February 07, 2008 23:47:00 EST

(RTTNews) - New York-based financial services provider Morgan Stanley (MS) announced plans on Thursday to start an equity fund in India, its first in the country after a gap of fourteen years. The bank plans to capitalize on the growing wealth of the country, where invested assets are projected to quadruple by 2012. The new fund, christened the Morgan Stanley ACE Fund, is expected to go on sale from February 11 until March 10, 2008 according to the sale document. The fund will reopen for ongoing transactions in April.


The fund will be the second domestic second fund of the US$600-billion investment management group in India after the Morgan Stanley Growth Fund, which was launched in 1994. Morgan Stanley holds less than one percent of its total assets under management in India.


The Morgan Stanley ACE or "Across Capitalisations Equity" fund will be benchmarked against the BSE-200 Index and is intended to generate long-term capital growth from an actively managed portfolio of equity and equity-related securities, including equity derivatives. The new fund offer is priced at INR 10 per unit.


Morgan Stanley seeks to expand in a rapidly growing INR 5.5 trillion Indian fund industry. However, the new fund will need to compete with mutual funds managed by domestic companies such as Reliance Capital Ltd. and UTI Asset Management Co. In addition, the launch of the new fund comes at a time when the Indian stock markets are trading weak. The Bombay Stock Exchange's benchmark Sensex index lost 13% in January this year.


Narayan Ramachandran, chief executive officer of Morgan Stanley Investment Management India Pvt. said, "We view the recent correction as an opportunity to build a portfolio. Maybe missed a step for three to four years, but still its better late than never.''


Ramachandran added, "We wanted to grow the asset management business along with other businesses, but they couldn't grow because of joint venture reasons, though this business was not a part of the JV."


Morgan Stanley first entered the Indian market in 1989 through a joint venture with State Bank of India Mutual Fund, and launched funds under the name "Magnum". The India Magnum Fund, an offshore fund launched in 1989, heralded the entry of the company in India.


Morgan Stanley launched the Morgan Stanley Growth Fund in January 1994. Even though the fund attracted more money than it could manage, the company was compelled under securities regulations to invest all the money within a few weeks of the fund closure, giving it little leeway to choose the price at which it could buy.


The fund, which priced units at INR 10 each, mobilized INR 9.8 billion at the time of its launch, three times more than its targeted INR 3 billion. At the end of January 2008, the fund had assets worth INR 36.70 billion.


Meanwhile, Morgan Stanley has also applied to the Indian regulatory authority to convert its Morgan Stanley Growth Fund, a close-ended fund that matures in 2009, into an open-ended plan and delist it from the Indian stock exchanges.


"The units of the fund are listed on 6 to 7 exchanges. We may have to delist these units in at least 2 to 3 months," said Sridhar Sivaram, executive director, Morgan Stanley.


Morgan Stanley also plans to launch two liquidity funds in the first half of the current year and has received regulatory approval for one of the funds.


MS closed Thursday's regular trading on the NYSE at $44.88, down $0.07 or 0.16% on a volume of 17.07 million shares. In the 52-week period, the stock has been trading in a range of $42.57-$90.95.

BSE SENSEX ON FRIDAY FEB 8, 12.00 PM

At 12.00 PM, the BSE Sensex was up by 12.77 points, or 0.07 % at 17539.70 points.It opened with an upward gap of 83.14 points at 17610.07, touched an intraday high of 17688.73 & low of 17373.69.


The market breadth was extremely negative on BSE: 572 scrips had advanced, 1969 declined, while 36 remain unchanged.


The BSE mid cap Index was lower by 115.54 points, or -1.48 % at 7665.58 . The BSE small cap Index was down by 211.66 points, or -2.07 % at 9990.97 .


The BSE-100 Index (down 23.93 points, or -0.26 % at 9357.20), BSE-200 Index (down 8.34 points, or -0.38 % at 2209.10), BSE-500 Index (down 38.64 points, or -0.54 % at 7088.23).


Top gainers of Sensex were Infosys(up 5.41% at Rs 1561.00), TCS(up 4.54% at 923.00), Satyam Comp.(up 4.11% at 406.90), Wipro(up 2.88% at 421.65), ITC Ltd.(up 1.98% at 196.00).


Major losers of Sensex were L & T(down -2.74% at Rs 3531.00), Bajaj Auto(down -2.14% at 2230.00), HDFC(down -1.95% at 2870.00), Mah & Mah(down -1.90% at 646.15), HDFC Bank(down -1.45% at 1470.00).


Top gainers from BSE-500 were Silverline(up 9.95% at Rs 12.93), HCL Techno(up 6.49% at 260.00), Balkrishna Ind.(up 6.26% at 778.50), Infosys(up 5.41% at 1561.00).


Top losers from BSE 500 were ESS DEE Alumini(down -8.53% at Rs 610.00), Bajaj Auto Fin.(down -7.80% at 370.05), Guj.State Petro(down -7.40% at 70.75), Redington(down -6.65% at 355.00).


BSE IT Index (up 4.20% at 3860.80) was top gainer in all sectors index. Led by HCL Techno (up 6.49% at Rs 260.00), Infosys (up 5.41% at Rs 1561.00).


BSE FMCG Index (up 0.96% at 2145.73), Led by ITC Ltd. (up 1.98% at Rs 196.00), Britannia (up 1.19% at Rs 1419.10).


BSE Oil & Gas Index (up 0.40% at 10711.09), Led by Hind.Petro (up 1.75% at Rs 273.90), Indian Oil Corp (up 1.28% at Rs 511.50).


BSE Realty Index (down -2.65% at 9764.68) was top loser in all sectors index. Led by Housing Develop (down -4.96% at Rs 888.00), Indiabulls Real (down -4.12% at Rs 634.00).


BSE Capital Goods Index (down -1.58% at 15866.16), Led by AIA Engineering (down -4.75% at Rs 1465.00), Praj Indust. (down -4.24% at Rs 163.80).


BSE Metal Index (down -1.19% at 15343.35), Led by Welspun Guj. (down -4.30% at Rs 435.00), Steel Auth. (down -3.90% at Rs 202.10).


BSE Power Index (down -1.08% at 3741.75), Led by GVK Power (down -89.83% at Rs 64.85), CESC (down -3.15% at Rs 530.05).


BSE Bank Index (down -0.78% at 10303.37), Led by Indian Overseas (down -3.14% at Rs 167.90), Canara Bank (down -2.87% at Rs 297.85).


BSE Auto Index (down -0.65% at 4752.51), Led by Hind.Motor (down -3.92% at Rs 46.60), Amtek Auto (down -3.69% at Rs 319.50).


BSE Health Care Index (down -0.30% at 3629.18), Led by Fortis Health (down -3.63% at Rs 79.65), Divi's Lab (down -2.97% at Rs 1390.00).

1:07 PM - In the Asian markets, only Nikkei is trading, and that is weak. Global cues are a side issue. The Indian market is looking intensely volatile and sliding badly. Sensex is at 17215, down 310 points and Nifty is at 5040, down 92 points from the previous close. The CNX Midcaps Index and BSE Smallcaps Index are both down 3%. The market breadth is negative with advances at 102 against declines of 1108 on the NSE.

europe: recovering quite strongly ftse100 +71.23 cac 40 +56.40

sensex & nifty recovering strongly.tech stocks gaining.

1:47 PM - The European markets opened in the positive. The market sees a slight recovery. Sensex is at 17435, down 91 points and Nifty is at 5111, down 22 points from the previous close. The CNX Midcaps Index is down 2.2% and BSE Smallcaps Index is down 3.3%. The market breadth is negative with advances at 121 against declines of 1092 on the NSE