General News:
– U.S. stocks advanced after higher oil prices bolstered the earnings outlook for energy producers and retailers’ back-to-school sales topped analysts’ estimates.
– Service industries that make up 90 percent of the U.S. economy grew more than forecast in August, confirming the Federal Reserve’s view that the impact of the credit-market rout is `limited” outside of housing.
– The number of Americans who may lose their homes to foreclosure reached a record in the second quarter as late payments by subprime borrowers surged to one out of every seven loans.
– The number of homeowners receiving foreclosure notices hit a record high in the spring, driven up by problems with subprime mortgages.
Asia/Europe:
Asia:
– China ordered banks to put aside more money as reserves for the seventh time this year to cool lending and investment after inflation accelerated to a 10-year high.
– Australia’s central bank said it will buy debt backed by home loans to add cash to the financial system, after the U.S. subprime credit rout eroded demand for asset-backed securities and drove up interest rates.
– Asian steelmakers’ shares rose, led by Posco, after Nippon Steel Corp. increased its full-year profit forecast to a record and Hyundai Steel Co. said it’s considering raising rates for its main product.
– The global credit rout sparked by the U.S. subprime mortgage slump may leave as much as $34 billion of leveraged loans for railroads, tollways and similar projects “paralyzed,” said analysts at Standard & Poor’s.
– Pallinghurst Resources Australia Ltd., chaired by Brian Gilbertson, raised its offer to acquire Australian manganese producer Consolidated Minerals Ltd. to A$937 million ($771 million), topping two rival offers.
– National Australia Bank Ltd. and its largest competitors threw a financial lifeline of more than A$10 billion ($8.2 billion) to several investment vehicles caught in the fallout from the U.S. subprime mortgage rout.
Europe:
– European stocks climbed after the European Central Bank shelved plans for an interest-rate increase and said it will launch an extra refinancing operation to ensure the functioning of the money market.
– The European Central Bank pumped 42.2 billion euros ($57.7 billion) into money markets to lower borrowing costs and said there’s more to come as it shelved an increase in the benchmark interest rate.
– The Bank of England left the benchmark interest rate unchanged at a six-year high, saying it’s trying to determine whether a surge in credit costs will harm the British economy.
– German manufacturing orders dropped the most in at least 16 years in July after a decline in sales of ships, trains and airplanes.
– Deutsche Bank AG, Germany’s biggest lender, will probably be the European investment bank most affected by the fixed-income markets rout, according to JPMorgan Chase & Co. analysts.
Corporate News:
– Wal-Mart Stores Inc., Macy’s Inc. and retailers catering to teenagers reported August sales that topped analysts’ estimates on purchases of clothing and electronics for the new school year.
– Campbell Soup Co. and General Mills Inc. reported profit gains after they raised prices to help blunt higher costs for commodities used in their foods.
– Royal Bank of Canada, the country’s largest lender, agreed to buy Alabama National BanCorporation for $1.6 billion in cash and stock, its biggest acquisition in six years.
