Dow Jones News Top Stories Of The Day – June 14, 2006

US CORE CPI RISES 0.3%, LIKELY SEALING RATE HIKE

U.S. core consumer prices post third-straight 0.3% increase in May, topping Wall Street expectations and suggesting high energy prices are seeping into underlying inflation. Report practically guarantees another rate hike from the Federal Reserve when it meets in two weeks, and perhaps even beyond. Overall May consumer price index increases by 0.4%, after climbing 0.6% in April.

UAL TO CUT 1K SALARIED, MANAGEMENT POSITIONS

Parent company of United Airlines plans to cut at least 1,000 salaried and management positions by the end of the year, part of a redoubled cost-savings effort, says the company’s CEO Glen Tilton.

BOEING HIGHER ON STRONG ORDER OUTLOOK

Boeing shares add 5% as a Goldman Sachs analyst upgrades the shares, along with the rest of the U.S. commercial aerospace sector, due to a better forecast for aircraft orders.

EADS PLUNGES ON A380 DELAY

EADS shares plummet 26% as management and strategy are placed in the spotlight after the company says delays in the delivery of its Airbus A380 super-jumbo jets will shave profit through 2010.

CHIP STOCKS RISE ON GOLDMAN UPGRADE

Brokerage boosts its investment ratings on Intel, as part of a larger call on the semiconductor sector, saying the recent selloff has been overdone. Intel shares add nearly 4%; AMD gains 4% and SanDisk rises 3%.

SENATE PANEL BACKS KOHN’S FED NOMINATION

Senate Banking Committee votes to recommend that full Senate confirm Donald Kohn to be vice chairman of Federal Reserve Board. Panel also votes to recommend Senate confirm four other nominees to financial regulatory positions.

FED’S BIES SAYS HOUSING ACTIVITY SLOWING

Federal Reserve Governor Susan Bies says that the U.S. housing market is slowing, but the adjustment is occurring in a gradual way, and underlying fundamentals of housing demand remain favorable.

EUROPEAN STOCKS END MIXED

European stocks end directionless as merger-and-acquisition related gains for Bayer, Vinci and Credit Suisse and Wall Street advance is offset by inflation worries and declines in aerospace sector as EADS slides on Airbus A380 delay.

ETHANOL MAKER VERASUN UP IN IPO

The first ethanol producer to go public this year receives a powerful boost from investors, with VeraSun Energy quickly delivering double-digit percentage gains. Shares climb 28% from IPO price.

JETBLUE ON TRACK TO POST 2Q PROFIT

Discount carrier’s CEO says it’s on track to post a profit in coming quarters, as company continues implementing its plan to return to profitability. High fuel prices are weighing heavily on JetBlue. Shares up 2%.

US AIRWAYS EXECS SELL SHARES

Some of US Airways’ top executives exercise stock options and sell shares for hefty gains this week. The sales are the executives’ first stock sales since America West bought US Airways last fall. Shares up 3%.

FORD EXEC CALLS FOR R&D TAX CREDIT

Ford Executive Vice President Mark Fields says U.S. government should take steps to help auto makers produce cars that are more fuel efficient and run on gasoline alternatives, including a permanent research and development tax credit.

STOCK TRADERS HAVE MIXED MAY

Schwab, which is cutting fees again, says average daily trades rise 4% from a month earlier, the same increase Knight Capital reports. E*Trade says total daily average revenue drop 3%. E*Trade falls 5%; Schwab and Knight edge higher.

BUSH SAYS RAIDS YIELDING GOOD INFO

Raids conducted in the wake of the killing of insurgent leader Abu Musab al-Zarqawi are yielding valuable information, President Bush says in press conference after returning from his surprise trip to Baghdad.

ITC TO INVESTIGATE CREATIVE CLAIMS VS APPLE

Legal wrangling between Creative Technology and Apple heats up, with the U.S. International Trade Commission voting to investigate Creative’s claims that the iPod maker infringed its patent.

PAYPAL CEO READY TO FIGHT GOOGLE

EBay unit’s president says it will ‘compete rigorously’ if Google launches its own online-payment product, which PayPal expects to happen at some point. EBay also announces it will begin a test with its Skype VOIP service starting Monday.

AXA TO BUY WINTERTHUR FOR $9.93B

Credit Suisse agrees to sell the life insurer, eschewing a potential IPO. Deal gives AXA a major presence in Switzerland and bolstering its activities elsewhere in Europe. Credit Suisse shares up 5%; AXA flat.

GOLDMAN GROUP IN DEAL FOR AB PORTS

Consortium led by Goldman Sachs agrees to pay $4.6 billion for the port operator. Deal would be the first significant successful U.K. bid by the firm since Paulson warned London-based bankers against pursuing hostile takeovers that might threaten relationships.

======= DOW JONES NEWSWIRES ANALYSIS AND COMMENTARIES =======

FED WATCH
Nasty CPI May Force Fed Rate Hike
Economists say mounting inflation pressures will with almost total certainty drive Federal Reserve to hike interest rates, and confidence in this outlook grew considerably stronger in wake of government’s consumer price index report.

CHARTING MONEY
Sources Say Custer Believed Dead
DJIA’s 2006 splash into red is pertinent only to investors who passively watched their holdings erode this year, says Stephen Cox. And today’s rally won’t undo this year’s damage unless DJIA moves above 10884.57-10988.59 resistance.

============ U.S. MARKETS ACTION ===========
DJIA up 61.79 points to 10770.25
NASDAQ up 8.46 points to 2080.93
S&P 500 down 12.71 points to 1223.69
10-year T-note down 22/32 at 100 18/32 yield 4.961
NYMEX Spot Crude down $0.11 at $68.45/bbl
Dollar/Euro up 0.0077 at 1.2624