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Dow Jones News Top Stories Of The Day – January 4, 2007 January 4, 2007

Posted by notapundit in Economic News.
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RETAILERS POST MODEST DECEMBER SALES GROWTH

Target’s same-store sales increase 4.1% in December, short of the 4.5% expected. It sees sales gaining 3.5% to 5.5% in January. Wal-Mart says it expects U.S. same-store sales to rise 1%-2% in January, as it reports a December same-store sales increase of 1.6%. Gap cuts its earnings forecast and says it is reviewing brand strategies for Gap and Old Navy. Wal-Mart, Target and Gap shares edge higher. International Council of Shopping Centers reports retail sales rise 3.1% in December, better than the 2.5% it expected.

OIL HITS 18-MONTH LOW ON WEATHER, STOCKS

New York crude oil futures fall 4.7% to $55.59 a barrel, the lowest for a front-month contract since June 2005 after Energy Department says gasoline stockpiles rise more than expected and as a warm Northeast winter damps heating oil demand.

US SERVICES GROWTH SLOWS; FACTORY ORDERS UP

Growth in U.S. service sector continues — but at a slower rate — as ISM non-manufacturing index falls to 57.1 in December. Also, pending home sales index falls 0.5% in November, while factory orders rise 0.9%. Weekly jobless claims up 10,000.

CONSTELLATION FALLS, CUTS VIEW, CITES UK TROUBLES

Shares tumble 10% after earnings fall 1% to $107.8 million, or 45c a share. Excluding items, earnings are 58c a share, 2c short of expectations. CEO blames earnings drop in part on cheap Australian wine, adding drought there could alleviate wine oversupply in U.K.

MONSANTO NET UP ON CORN SEEDS, HERBICIDES

Seed manufacturer’s fiscal 1Q net grows 53% to $90 million, or 16c a share, while sales increase 9.5% to $1.54 billion. Analysts forecast earnings of 10c a share on sales of $1.53 billion. Shares fall 2% as full-year outlook disappoints.

PELOSI BECOMES FIRST FEMALE SPEAKER

San Franciscan new leader of House of Representatives as Democrats take control of both chambers of Congress after 12 years in the minority. Pelosi says, “We have broken the marble ceiling.”

JUSTICE DEPARTMENT OBJECTS TO DELPHI DEAL

Department of Justice criticizes plan by private investors to bring Delphi out of bankruptcy protection, saying it will improperly pay professional fees and keeps other parties from participating in auto-parts supplier’s reorganization.

US NUCLEAR WEAPONS CHIEF DISMISSED

U.S. Energy Secretary Samuel Bodman announces the dismissal of Linton Brooks because of security breakdowns at weapons facilities. An acting head of the agency will be named soon.

US APARTMENT VACANCIES UP IN 4Q

U.S. apartment market ends 2006 with surprisingly large increase in number of empty apartments, due to a combination of rising rents, seasonal factors and increased supply from failed condominium projects converted to rentals.

NEW YORK TIMES TO SELL BROADCAST GROUP

New York Times plans to sell its broadcast-media group, including nine television stations, to Oak Hill Capital Partners for $575 million. Media company says it needs to focus on its publication and digital businesses.

TVS SEEN BOOSTING ELECTRONICS RETAILERS

Big discounts on flat-screen TVs likely helped generate increased sales at Best Buy and Circuit City in December. But when they report sales tomorrow, investors will focus on whether sales were strong enough to offset impact of steep promotions.

HOME DEPOT HOLDERS TAKE AIM AT BOARD

Home Depot board isn’t off the hook yet despite CEO Nardelli’s departure. Shareholders still press for restructuring of board, which they blame for approving CEO pay and forgiveness of a $10 million loan. Kenneth Langone is on top of list.

WAL-MART MOVES TO POWER STORES WITH SOLAR ENERGY

World’s largest retailer confirms it is seeking solar-panel suppliers to equip its more than 3,900 stores with renewable energy. Wal-Mart says in ’05 it intends to eliminate 20% of its stores’ greenhouse emissions over next seven years, and wants to eventually be 100% supplied by renewable energy.

MORGAN STANLEY CHANGES FOREIGN ACCOUNTS POLICY

Morgan Stanley, citing tougher government regulation of non-U.S. accounts, is now handling foreign account-holders with less than $250,000 under management via call centers rather than individual brokers.

BJ’S WHOLESALE DOWN AFTER SLASHING 4Q VIEW

Shares fall 4% after wholesale club operator lowers its earnings outlook for fiscal 4Q earnings to 17c-25c a share from 83c-87c a share, and announces it will close its two ProFoods Restaurant Supply locations and 46 in-club pharmacies.

EBAY BOOSTS FEES TO PAY FOR IMPROVEMENTS

Online auction site plans to raise some listing and sales fees to improve its online marketplace. Many analysts thought it more likely that eBay would trim fees as it attempts to jumpstart a slowing growth rate. EBay shares up 4%.

GROSS SEES FOUR RATE CUTS THIS YEAR

Bond king Bill Gross believes the Fed-funds rate will be at 4.25% at year’s end, compared with the current 5.25% rate, with the 10-year Treasury yield sitting around 4.5%. He suggests keeping close watch on inflation-unadjusted GDP.

SHARPER IMAGE TO REPRICE OPTIONS

Specialty retailer will raise the price on 24 stock-option grants made between 1995 and 2005 to current executives Feroe, Alexander and Farrell. The amount of the repricing isn’t disclosed.

FAMILY DOLLAR FINDS OPTION PROBLEMS

Discounter say some of its options for new hires carried incorrect measurement dates in one or more years. As a result, the company won’t file its quarterly report on time. Shares slip 1%.

WHITE HOUSE LEGAL COUNSEL MIERS RESIGNS

President Bush accepts Harriet Miers resignation as White House counsel, effective Jan. 31. Search is now underway for a successor. Miers withdrew as Supreme Court nominee in 2005 amid a lack of support from conservatives.

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

LATE TRADING
Electro Scientific Down On Smaller 2Q Margins
Auto electronics maker’s shares drop 6% in late trade after the company reports less-than-expected 2Q earnings because of a smaller gross margin. Shares of Xyratex add 3% after the designer of data system equipment reported 4Q earnings above expectations.

SMALL CAPS
End Higher As Oil Slides
Small stocks gain on a further pullback in oil prices, but retailers have a mixed day after reporting monthly sales. Hot Topic tumbles 17% after the teen retailer’s December same-store sales drop 5.1%, and the company lowers its 4Q earnings guidance.

============ U.S. MARKETS ACTION ===========
DJIA up 6.17 points to 12480.69
NASDAQ up 30.27 points to 2453.43
S&P 500 up 1.71 points to 1418.34
10-year T-note up 14/32 at 100 4/32 yield 4.606
NYMEX Spot Crude down $2.73 at $55.59/bbl at close.
Dollar/Euro up/down X.XXXX at X.XXXX

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