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Dow Jones News Top Stories Of The Day – January 31, 2007 January 31, 2007

Posted by notapundit in Economic News.
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FED LEAVES RATES AT 5.25%; INFLATION IN FOCUS

FOMC continues to lean toward higher rates should inflation perk up again. Its statement is more upbeat on both growth and inflation, though officials reiterate ‘some inflation risks remain,’ further highlighting a reduction in interest rates isn’t at all on the Fed’s radar screen. Shares rally after decision, with DJIA up more than 100 points.

ALTRIA TO SPIN OFF KRAFT ON MARCH 30

Long-awaited move has been held up amid uncertainty of tobacco litigation against Altria, whose holders as of March 16 will get 0.7 Kraft share for each Altria share they own. Altria’s 4Q net climbs 29%; Kraft earnings slip 19%.

US AIRWAYS WITHDRAWS OFFER FOR DELTA

Official committee of unsecured creditors for Delta rejects the hostile takeover bid by US Airways, formerly valued at $9.75 billion, intent to exit bankruptcy as an independent company this spring. US Airways withdraws its offer.

US GDP UP AMID LOWER INFLATION

Gross domestic product climbs at 3.5% annual rate in 4Q, overcoming housing slump as consumer spending surges. Employment costs soften slightly in 4Q. Also, construction spending falls 0.4%, while Chicago PMI falls to 48.8 in January.

CITIGROUP CFO JOB DRAWS MUCH INTEREST

Chief Executive Charles Prince says company is getting lots of interest from internal and external job candidates as it searches for a new chief financial officer. Prince expects to fill position in the next 45 days.

BOEING 4Q NET DOUBLES, RAISES VIEW

Airplane maker posts net income of $989 million, or $1.29 a share, which includes 13c in gains. Revenue jumps 26% to $17.54 billion. Analysts expected EPS of 98c on revenue of $16.48 billion. Shares rise 4% as firm boosts 2007 earnings forecast.

OIL MARKET WELL SUPPLIED AHEAD OF OPEC CUTS

U.S. Energy Secretary Samuel Bodman says he believes global crude markets were well supplied ahead of the upcoming driving season in the U.S. — when refiners tend to build stocks — and ahead of expected additional production cuts due to be implemented by OPEC tomorrow.

BP TO REMOVE PART OF PIPELINE FOR RESEARCH

BP plans to remove a 40-foot section from a major Prudhoe Bay pipeline to learn more about leaks that led to partial shutdown of the largest U.S. oil field last summer, a BP spokesman says.

FORD FOCUSES ON RETAIL; SEES JAN SALES OFF 20%

Sales analysis manager George Pipas says the auto maker expects its January sales to decline about 20% compared to the prior year due to the company’s decision to back away from heavy dependence on selling to rental car fleets.

TIME WARNER NET UP 34% ON ASSET SALES

Media giant earns $1.75 billion, or 44c a share, in 4Q, helped by sale of European unit and tax benefits. Revenue rises 8.2% to $12.47 billion. Excluding items, Time Warner earns 23c a share, a penny better than expected. Shares edge lower.

SEC FLOATS PLAN TO TEST FUND-DATA ‘TAGGING’

SEC votes unanimously to float a proposal that would allow mutual-fund companies to test computer ‘tagging’ of key fund information, including risk and returns.

FDIC ADDS 1 YEAR TO MORATORIUM ON BANK APPLICATIONS

Vote immediately redirects the focus of the controversial issue onto Capitol Hill, where legislation has already been introduced that would bar commercial firms such as Wal-Mart from owning banks.

ESSENT, NUON SET TO ANNOUNCE MERGER

Dutch utilities Essent and Nuon will announce their merger plans Thursday, making it the biggest ever in The Netherlands ever, sources close to the situation tell Dow Jones Newswires. Combined firm’s equity value estimated at $31 billion.

BRISTOL-MYERS UP ON TAKEOVER TALK

Bristol-Myers Squibb shares rise 3% amid continued speculation that drug maker would be bought out by Sanofi-Aventis. Financial Times reports Bristol has hired Lehman Brothers to work alongside Citigroup and Morgan Stanley to examine options.

BUSH SAYS SARBANES-OXLEY SHOULD CHANGE

Sarbanes-Oxley corporate governance legislation needs to be reformed, President Bush says, arguing that compliance is expensive for companies and may discourage some from listing shares on U.S. exchanges.

US MAY END 3-YEAR NOTE AUCTIONS

Treasury may eliminate auctions of its three-year note starting with the August refunding to adjust for reduced borrowing needs in a period of strong government receipts.

PAULSON SAYS CHINA REFORMS TOO SLOW

Treasury Secretary tells Senate Banking Committee that China is taking steps toward its long-term goal of a free-floating currency, though the pace of reform has been too slow. Paulson isn’t worried about China’s reserve management.

NYSE, TOKYO EXCHANGE FORM ALLIANCE

New York Stock Exchange agrees to alliance with the Tokyo Stock Exchange that could lead to cross shareholdings, the latest international push by Big Board CEO John Thain, who already has made aggressive moves into Europe and India.

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

SOMETHING VENTURED
VC Firms Moseying Out Of Texas
Although Texas has long been considered a major hub of venture capital investing, behind Silicon Valley and Boston, few firms are making money off their operations in the state, an investor says, and there are signs of trouble.

NOTICE TO READERS
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Tomorrow’s News Today is a Dow Jones Newswires end-of-day market newsletter emailed shortly after market close. It is complimentary to all Dow Jones News Service subscribers. To sign up, send email to tomorrowtoday@dowjones.com or call (800) 223-2274.

============ U.S. MARKETS ACTION ===========
DJIA up 112.32 points to 12634.67
NASDAQ up 18.15 points to 2466.79
S&P 500 up 8.20 points to 1428.82
10-year T-note up 12/32 at 98 14/32 yield 4.875
NYMEX Spot Crude up 1.17 at $58.14/bbl at close
Dollar/Euro up 0.0065 at 1.3030

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