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Dow Jones News Top Stories Of The Day – January 3, 2007 January 3, 2007

Posted by notapundit in Economic News.
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GM, FORD SALES DROP 13%; TOYOTA’S RISE 12%

General Motors and Ford each post a 13% drop in U.S. sales for December, with double-digit declines in truck sales. DaimlerChrysler’s U.S. unit, which also has a heavy reliance on trucks and SUVs, says total sales increase 0.5%. Toyota reports a 12% rise but falls short of expectations it would again surpass Ford as nation’s No. 2 auto maker. GM shares fall 4%; Chrysler gains 1%.

FED MINUTES SHOW MORE DOWNSIDE RISKS

Fed officials last month saw greater downside economic risks to the economy, citing a housing sector that weighed “heavily” on activity, minutes of the Dec. 12 FOMC meeting show. Still, inflation remains top concern.

NARDELLI LEAVES HOME DEPOT, WILL GET $210M

Chairman and CEO Robert Nardelli agrees to leave the home-improvement retailer after six years capped by controversy over his pay. He will take a $210 million severance package with him as he is replaced by Vice Chairman Blake.

HOT TOPIC CUTS 4Q VIEW; SHARES DOWN

Teen retailer’s December same-store sales fall 5.1%, and Hot Topic cuts its 4Q earnings forecast to 20c-22c a share from a previous outlook of 33c-38c a share. Shares fall 11% late. American Eagle raises its 4Q forecast as sales jump 13%.

RETAILERS’ DECEMBER SALES SEEN MODEST

Retailers generally are expected to post modest December sales, as a last-minute shopping surge before Christmas failed to offset heavy markdowns on electronics, and mild weather cooled demand for winter apparel.

US ISM INDEX UP; CONSTRUCTION SPENDING DOWN

Institute for Supply Management’s index of manufacturing activity rises to 51.4 in December from 49.5 in November. Economists expected reading of 50. Meanwhile, housing slump forces construction spending down 0.2% in November.

ALCATEL-LUCENT UP ON AT&T, BELLSOUTH NEEDS

Shares of Alcatel-Lucent add nearly 8% as industry watchers predict the closing of the merger between AT&T and BellSouth would benefit it and other telecommunications-equipment suppliers.

REDHOOK, WIDMER IN MERGER TALKS

Redhook Ale Brewery and Widmer Brothers Brewing may begin preliminary talks about a merger or other combination, according to a filing by Anheuser-Busch with the Securities and Exchange Commission.

SEC TO REVIEW NYSE DATA FEE

SEC is reviewing its approval of a rule allowing the New York Stock Exchange’s parent, NYSE Group, to charge for market data that once was free, after receiving protests from Internet companies including Google and Yahoo.

APPLICA SAYS HARBINGER UPS OFFER

Applica says that Harbinger Capital has increased its offer for the company to $7.75 a share from $7.50. Earlier today, Nacco increased its offer to $7.75 a share.

PARKINSON’S DRUGS MAY DAMAGE HEART VALVE

Study finds one-fourth of patients taking pergolide or cabergoline had moderate to severe heart valve problems. Additional study shows patients using drugs were five to seven times more likely to have leaky heart valves.

DELL ISSUES SHARES TO UNIT

Dell says it issued 475.4 million common shares valued at $12 billion to an Asian subsidiary as part of a change of the company’s corporate structure that will make Singapore what a company spokesman calls its “shared headquarters.”

AK STEEL TO ADD $180/TON SURCHARGE

AK Steel is adding a $180 per ton surcharge for electrical steel products shipped in February. AK Steel says the surcharges are based on reported prices for raw materials and energy used to manufacture the products.

MANHATTAN RESIDENTIAL PRICES FALL FOR 2ND QUARTER

Average sales price of a Manhattan apartment fell 5.7% between third and fourth quarters of 2006, marking the second consecutive quarter that prices have fallen, according to Mitchell, Maxwell & Jackson.

US HOUSE DEMOCRATS SET TO ACT ON BILLS

House Democrats begin tomorrow their effort to quickly pass legislation increasing the federal minimum wage, repealing a tax break for oil producers, and allowing government negotiation of Medicare drug prices.

FORECAST SEES DECEMBER PAYROLLS DOWN

Payrolls giant Automatic Data Processing and consultancy Macroeconomic Advisers forecast a decline of 40,000 private-sector jobs in Friday’s monthly payroll report. Economists’ expectations are for an 115,000-job increase.

EARTHLINK CEO DIES AFTER BATTLE WITH CANCER

President and CEO Charles “Garry” Betty, 49, took a medical leave in November after being diagnosed with “a serious form of cancer.” Michael Lunsford, an executive vice president since 2000, will remain interim CEO.

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

POINT OF VIEW
Australia Leads On Hedge Fund Rules
Critics who say U.S. corporate regulation is too heavy handed point to England’s principles-based style as a better alternative. When it comes to hedge funds, U.S. policy makers might take a look at Australia, writes Neal Lipschutz.

LATE TRADING
Hot Topic Down; Cuts 4Q EPS View
Shares of Hot Topic fell 11% in late trading after the retailer cut its 4Q earnings forecast because sales at stores open at least a year fell 5.1% in December. Citi Trends drops 2% after reporting December same-store sales edge lower

============ U.S. MARKETS ACTION ===========
DJIA up 11.37 points to 12474.52
NASDAQ up 7.87 points to 2423.16
S&P 500 down 1.67 points to 1416.63
10-year T-note up 16/32 at 99 22/32 yield 4.662
NYMEX Spot Crude down $2.73 at $58.32/bbl at close.
Dollar/Euro up 0.0011 at 1.3281

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