Thursday, September 6, 2007

Morning Note...

Futures slightly lower this morning as short-term volatility continues.  The S&P was up 15 points Tuesday and gave back 17 points Wednesday.  Obviously there is still fear of a recession stemming from credit market issues, but recent data suggests only a moderate slowdown.  While WalMart posted a 3.1% same store sales gain, Costco reported a lower-than-expected 2% gain only.  ANF and AEO posted good numbers, as did SKS and JWN.  Limited and Dillard’s were weak.  August auto sales – as previously reported – were also better than expected.  Initial jobless claims came in better than expected.  Thus it appears from the cursory evidence that Q3 real GDP will be somewhere in line with the 2.5% forecast rate.

ECB left benchmark interest rate unchanged at 4%.

August employment data due tomorrow.  Oil trading above $76/barrel.  10-year note yields 4.48%.

Announced Deals: 

Rockbay News:  Tata Tea may join PE consortium as bid partner for CBRY LN, WSJ article defends KKR’s stance to refuse to amend deal terms to assist banks, FINL same-store-sales +1.3%, IFX upped to Buy at Dresdner, ABN Amro CEO defends deal (vs. stand alone) as in best interest of shareholders, CEN urges shareholders to reelect board and not vote in Pershing Square nominees, LEHM ups RTR LN, MLCO reits Buy on NRG, dR reports on doubts surrounding RTP/AL deal, NHY NO to double investment and expand production to meet increased demand, ASTSF announces Aug revs of $44mm, CAO announces “strategic review” of itself

Vito’s Advanced Trivia:  Name the world’s tallest mountain.

Yesterday’s Answer:  The United States boasts the larger tiger population in the world.  Apparently, there are more tigers in captivity in Texas than the are in the wild anywhere in the world.