General News:
– Wall Street Journal reports of a large amount of leveraged loans that are outstanding within the ballpark of almost $500 billion.
– Wall Street Journal says that the New-York based private-equity firm, Kohlberg Kravis Roberts & Co. (KKR) has run out of some of its traditional investors for deal-making and is turning to hedge funds for its funding.
– Drop in gasoline prices has helped some discretionary spending. June sales are expected to rise about 2%, according to the International Council of Shopping Centers, ICSC.
– The International Energy Agency has raised its global forecast for oil demand for the year to 86.1 million barrels a day, up 420,000 barrels/day as originally forecast. China’s demand is expected to be up 6.1%.
– IEA reports that world supply of oil fell to 84.9 million barrels per day in May and that OPEC spare capacity is at 2.8 million barrels per day.
Asia/Europe:
Asia:
– Japanese consumer confidence fell 0.2 to 47.4, slightly lower than expected.
– Japan’s Economic Ministry said that GDP numbers confirm an economic recovery, but output is somewhat weak and consumption is not strong enough. There are still signs of inflation.
– China’s CPI rose 3.4%, 3.3% was expected.
– Food prices in China rose 8.3%, making a new high.
– China is threatening a counter response if the US Congress goes forward in placing tariffs on Chinese imports.
Europe:
– Bank of England’s, Mr. King, said that a rate hike would be needed if capacity pressures remained and inflation expectations remained elevated.
– United Kingdom CPI rose 0.3%, in line with expectations.
– Germany’s Business Survey reported 34% improvement in firms with only 10% worsening.
Corporate News:
– W.W. Grainger (GWW) reports sales were up 8%.
– Nokia (NOK) is looking for more acquisitions, according to a Dow Jones report.
– Lehman Brothers (LEH) posted strong results
– Diodes (DIOD) raised its revenue forecast for the quarter.
– Take-Two Interactive (TTWO) reported good earnings.
– The CBOT (BOT) and Chicago Mercantile Exchange Holdings (CME) get approval from the anti-trust courts.
– Dow Jones & Co. (DJ) reports weak ad revenues in May.
– Standard Pacific (SPF) reports that orders are down 16% year over year and 20% below the plan for April/May, citing weak housing markets in Florida and Arizona. California improved on more selling communities while orders were flat in the Carolinas and down in Texas.
Favorable Comments:
– McDonalds (MCD) and Pier 1 Imports (PIR) receive good comments at Goldman Sachs.
– Genworth (GNW), Hartford Financial Services Group (HIG) and MetLife (MET), all in the insurance business, are on buy lists at Bank of America.
Negative Comments:
– Starbucks (SBUX) and Target (TGT) are off the buy list at Goldman Sachs.
– United States Steel Corporation (X) downgraded at Bear Stearns.
– Credit Suisse First Boston hands out negative comments for the railroad industry.