Media Moguls Twitter Over Slump, Not Takeovers, in Sun Valley

July 11 (Bloomberg) -- Media moguls Rupert Murdoch and Howard Stringer attend the annual Allen & Co. media conference in Sun Valley, Idaho, to kick the tires on new businesses. This year, they didn’t find much.

Murdoch, chairman and chief executive officer of News Corp., and Stringer, his counterpart at Tokyo-based Sony Corp., said separately at the conference this week that they won’t bid on Twitter Inc., the Web messaging service, signaling Internet businesses have become less attractive to media companies stung by the recession.

That’s a departure from recent retreats sponsored by the New York-based investment bank. In 2007, CBS Corp. CEO Leslie Moonves held talks that led to the $1.7 billion purchase of CNet Networks, the online technology news company. Sling Media founder Blake Krikorian said he started discussions in Sun Valley that led EchoStar Corp. to pay $380 million for his company, which lets users watch their home TV services online.

“It’s not a club I’m looking to join,” Stringer, 67, said in an interview. “A lot of people are doing well making very little money.”

Slumping advertising sales are overshadowing the usual interest traditional media companies show in acquisitions, David Winters, CEO of Wintergreen Advisers LLC, in Mountain Lakes, New Jersey, said at the conference. The company managed $1.03 billion as of June 30, according to data compiled by Bloomberg.

Murdoch, 78, and Stringer told reporters in Sun Valley this week they are interested in companies with profit and growth potential.

“I don’t see an end to the downturn, and I can’t predict when we’ll start to see a rebound,” Murdoch said in an interview.

Cash Hoard

New York-based News Corp., owner of the Fox network, Wall Street Journal, cable channels, film studios and satellite broadcasting interests, will hold on to its $6.05 billion in cash until the recession ends, Murdoch said.

News Corp. fell 6 cents to $8.17 yesterday in Nasdaq Stock Market trading. The Class A shares have declined 10 percent this year. Sony’s U.S. traded shares lost 60 cents to $23.85 on the New York Stock Exchange and have gained 9.1 percent.

Traditional media companies and newer Internet businesses face a similar dilemma, trying to get online users to pay for their products, cable billionaire John Malone told reporters at the conference.

Television, film and publishing companies must find a way to charge Internet users for content they provide, said Malone, 67, the chairman of Liberty Media Corp. Some are running out of time as they struggle to generate online sales, he said.

Paying Customers

Internet companies including San Francisco-based Twitter and Google Inc.’s YouTube will need to sell subscriptions to make money, Malone said.

Without new pay models, the Internet will drain profits at media conglomerates as it has at newspapers, said Malone, who runs Liberty Media from Englewood, Colorado. Companies must find ways to be compensated, just as cable operators convinced consumers to pay for TV after decades of free broadcasts.

Mountain View, California-based Google is looking for acquisitions, CEO Eric Schmidt said in an interview with Bloomberg television.

“We have talked a lot with Twitter,” Schmidt said at a press conference in Sun Valley.

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Stocks falter as earnings jitters increase

NEW YORK (AP) - Falling oil prices and unease over corporate earnings are putting more pressure on stocks.

Stocks were mostly lower in early trading Friday, as investors shed positions in energy, utilities and bank shares.

News that Chevron Corp.’s refining margins fell in the second quarter is adding to the market’s worries. On a year-over-year basis, Chevron’s overall second-quarter results are forecast to be much lower than those for 2008. Oil prices subsequently resumed their descent early Friday after a slight pop on Thursday, falling below $60 a barrel.

The market is also on edge ahead of more earnings reports, which pick up pace next week. Investors have sent major indexes down about 7 percent since mid-June on the belief that a more than 40 percent run-up in stocks this spring was unwarranted considering the problems that still plague the economy.

One bit of good news Friday: The Commerce Department said the U.S. trade deficit narrowed to $26 billion in May - the lowest level in more than nine years. The report seemed to temper some of the market’s losses.

In early trading, the Dow Jones industrial average fell 42.25, or 0.5 percent, to 8,140.92. The Standard & Poor’s 500 index lost 4.11, or 0.5 percent, to 878.57, while the Nasdaq composite index rose 3.33, or 0.2 percent, to 1,755.88.

The declines Friday come after a small advance the day before, when all the major indexes posted single-digit gains. Finding some encouragement in better-than-expected results from aluminum maker Alcoa Inc., investors put money into commodities producers, banks and industrial companies.

Despite the slight increase in risk taking Thursday, the overall mood in the market is one of caution. Investors are anxious for more clarity on where the economy is headed. They are looking to companies’ earnings reports for just that, but expectations are low.

Falling crude prices continued to weigh on the market Friday. A barrel of crude traded at $59.29, down $1.12, on the New York Mercantile Exchange. Oil prices have fallen sharply since hitting an eight-month high of $73 early last week. The drop in prices has sent stocks falling as investors anticipate that a weaker world economy will mean less demand for energy.

In corporate news, General Motors Corp. CEO Fritz Henderson announced that the automaker has emerged from bankruptcy protection after just a little over a month of being under court supervision. He said the company now will focus more on customers, including a partnership with eBay for people to buy vehicles by auction online.

Overseas, Japan’s Nikkei stock average fell 0.04. In afternoon trading, Britain’s FTSE 100 was down 0.3 percent, Germany’s DAX index fell 0.2 percent and France’s CAC-40 lost 0.8 percent.

Bond prices rose. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.34 percent from 3.41 percent late Thursday.
In other trading, the Russell 2000 index of smaller companies fell 1.24, or 0.3 percent, to 478.03.

About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to a low 135.8 million shares.

The dollar rose against other major currencies, while gold prices were down.

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Stocks modestly higher ahead of Alcoa report

NEW YORK (AP) - Stocks are modestly higher in early trading as investors wait for aluminum maker Alcoa Inc. to give some guidance about the economy.

Investors worried that the world economy may take longer to emerge from recession than originally hoped are turning their focus this week to companies' financial results and, more importantly, to what they have to say about business conditions for the rest of the year.

Alcoa kicks off earnings season Wednesday with its second-quarter report, to be released after the market's close.

In the first few minutes of trading, the Dow Jones industrials are up 14 to 8,177. The Standard & Poor's 500 index is up 2 to 883 and the Nasdaq composite index is up 9 to 1,755.

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Stocks Close Mixed Despite Big Drop in Oil

The bulls shrugged off a massive drop in the price of oil to push stocks to a mixed close Monday. Technology shares, indicated by the Nasdaq Composite, closed lower.

Today’s Markets

At the 4 p.m. close in New York, the Dow Jones Industrial Average rose 44.13 points, or 0.53%, to 8324.87, the Standard & Poor's 500 gained 2.28 points, or 0.25%, to 898.70 and the Nasdaq Composite sank 9.12 points, or 0.51%, to 1787.40. The consumer-friendly FOX 50 gained 1.59 points, or 0.24%, to 668.35.

Stocks came way off of their lows by afternoon trading, rising from a 90-point drop at today’s open. However, volume was abnormally light, with less than 900 million shares trading hands.

With little company or economic news to go on and Wall Street coming off a long holiday weekend, Monday’s session was defined primarily by a broad selloff in the commodities complex.

Oil futures retreated by $2.68 a barrel, or slightly more than 4%, to $64.05 in New York-based trading. Crude had recently been as high as the low $70s last month. The metals markets were somewhat quieter, with gold trading lower by $6.70 to $924.00 a troy ounce and industrial copper futures falling by 1.8%.

Oil was led lower primarily by gains in the U.S. Dollar, which were up about 0.5% against the Euro and British Pound, and the negative June jobs report coming out of the Labor Department on Thursday, which gave traders concern an economic recovery was still heavily in question.

"Although unemployment numbers are a lagging indicator it certainly was a reminder that the US & European economies are still a ways away from recovery mode," said Dominick Chirichella with the Energy Management Institute

Oil and copper’s drop dragged down three energy and material components of the Dow: Exxon Mobil (XOM), Chevron (CVX) and Alcoa (AA). Other material names lower this morning included U.S. Steel (X), copper mining giant Freeport McMoRan (FCX) and ConocoPhillips (COP).

"Right now, where oil goes so goes the rest of the market," Jud Pyle with Peak6 Investments told FOX Business. "It's a gauge of broader sentiment on where this economy is headed."

Those loses were offset by a rise in the consumer staple stocks such as Proctor & Gamble (PG), Kraft Foods (KFT), and others.

For today’s economic agenda, the only report out today is the Institute for Supply Management's service sector index, which came in slightly better than expected.

The ISM non-manufacturing index for June was at a reading of 47.0, a point above the 46.0 expected by economists. A reading below 50 indicates the service sector is contracting.

The new orders index, a sign of future economic activity, rose to a reading of 48.6 compared to a May reading of 44.4.

Company News

A bankruptcy judge ruled that General Motors can sell its assets to a new company, a key step for the reemergence of GM from Chapter 11 bankruptcy.

EMC Corp. (EMC) raised its offer for online storage company Data Domain (DDUP) to $2.2 billion, or $33.50 a share. EMC has been in a bidding war for Data Domain with its primary competitor NetApps (NTAP).

Global Markets

In London, the FTSE 100 index fell 0.98% to 4184.91 while Paris' CAC 40 traded down 1.2% to 3082.16 and Germany's DAX fell 1.2% to 4651.82.

In Asia, Japan's Nikkei 225 closed lower by 1.38% to 9680.87 while Hong Kong's Hang Seng fell 1.23% to 17979.41. China's Shanghai Composite rose 1.18% to 3124.67.

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Online trading craze grips Vietnam

Hang around Vietnamese cafés long enough and you are likely to see an arresting sight: one person handing another a grocery bag stuffed with bank notes. Drug deal? Bribe?

In fact, this is the way many Vietnamese buy stocks these days - not through a broker or the stock exchange but through the Internet, with payment made in cold cash. Finding each other through stock-trading chat rooms and websites, buyers and sellers strike a deal online and then close it by exchanging cash for stock certificates.

It's a vivid sign of the times in booming Vietnam. With the economy growing at its fastest clip in a decade, everyone wants to get in on the action. From taxi drivers to tycoons, Vietnamese are speculating wildly on anything that might go up - apartments, gold, land and, above all, stocks.

Online trading is an easy way to play the game. Traders don't need to open an account with a broker. They don't even need a bank account. Unregulated, informal and private, the online market works something like Craigslist or eBay. But they're not trading baseball caps or Dad's stamp collection.

Participants are trading stocks in privatized state companies that make everything from fertilizer to tractors.

Because they ride the waves of the market, these traders are known as market "surfers." On the trading site sanotc.com.vn, surfers with handles like hunter, ghostman, Billgatesvn8x and buyhigh_selllow, barter all day, some offering shares at a premium to see if anyone will bite, others trying to wheedle sellers into giving a discount.

A surfer called huanquan_2006 peddles stock in the Vinagolf golf tourism company. He claims people are begging him to sell at 43,000 dong ($2.61) a share but the stock is sure to go for at least 80,000 when it is listed on the stock exchange. "I own 15,000 shares of this baby. Come on, who wants it? Let's party."

Meanwhile, trungvalen1982 proffers a real estate stock that is just bound to go up because the company is about to build "the most magnificent building in Hanoi," a 30-storey tower. "No way will it be under 200. Anyone want the bloody thing? I can sell it to you at 145."

In another exchange, surfers debate the merits of STB, the stock code of the Saigon-Thuong Tin Bank. "What the hell happened with STB today?" writes someone who goes by Muoidotinox. "I bought this thing at 155 and today the price to 146. My guts are in a knot."

"Don't think of its price each day, you are making a long-term investment," advises Xmas2k5, "Just like putting money in the piggy bank. Before long you'll be able to break that pig and buy yourself a villa."

Not long ago, such banter would have been unthinkable. Almost all Vietnamese companies belonged to the state so there was no such thing as stock or a stock market, much less an informal Internet trading market. But, as it opens its economy, Vietnam's Communist government has privatized more than 3,000 companies and many are going to the market to seek investment.

Their newly issued shares go to executives, staff and members of the general public, who often turn around and flip them for a quick profit. It's risky, but for Vietnamese, who love gambling, addictive. "We're natural risk takers and adventurers," says Ho Chi Minh City stock broker Hun Nam. "People get rich, lose it all then come right back to the market."

With many newly privatized companies releasing little reliable financial information, surfers often buy and sell on the basis of rumour and hearsay. "They'll say things like, 'My friend has an uncle who has a sister who's married to a guy who bought this stock,' " says Mark Djandjy, a Canadian who is head of research for Ho Chi Minh City's Horizon Security Analysis.

Surfer Pham Thanh Tung, 29, says he has increased his money 11 times since he started trading a couple of years ago. "It's easy to buy, easy to sell," he says, "I give you money and you give me stocks - nobody knows."

Another surfer, Trinh Tuan Vu, 26, says he once walked into a café with six billion Vietnamese dong, the local currency, in three ordinary plastic shopping bags. That's nearly $400,000 (U.S.).

How popular is online trading? Sanotc.com.vn, the trading site, has more than 175,000 members and the number is increasing by up to 700 a day.

One reason is that the opportunities on the formal market are still limited. The Ho Chi Minh City stock exchange lists just 120 companies and the Hanoi exchange another 100. But the sanotc site lists 1,462, most of them companies that have issued stock but are not ready to list on the formal exchanges.

The enthusiasm of surfers has helped fuel a big runup in share prices. The Ho Chi Minh City exchange is up tenfold since opening seven years ago. Last year, it doubled. But there are wild swings along the way. The market fell by 30 per cent in April and almost as much in August.

Concerned about irrational exuberance, the Vietnamese government has brought in a law limiting securities loans and plans to put a tax on stock trades.

Mr. Pham says that won't slow him down. He recently saw a 300-per-cent gain on a rubber company stock he bought. "Everyone likes to make a profit," he says with a smile.

Surf's up, and no one wants to miss the wave.

U.S. Stocks Slide in Dow’s Worst Drop Since April on Jobs Data

July 2 (Bloomberg) -- U.S. stocks tumbled, sending the Dow Jones Industrial Average to its biggest drop since April 20, as a worse-than-projected decrease in jobs added to concern that rising unemployment will prolong the recession. Treasuries rose, while oil retreated to a five-week low.
Home Depot Inc., Alcoa Inc. and Travelers Cos. lost at least 3.8 percent after the Labor Department said payrolls shrank by 467,000 jobs last month, 102,000 more than the average economist estimate. Lear Corp., the second-biggest maker of automotive seats, plunged 52 percent on plans to file for bankruptcy. Europe’s Dow Jones Stoxx 600 Index slid 2.6 percent, the most in almost two weeks, following the jobs report.
“It’s ugly out there,” Jack Ablin, who oversees $60 billion as chief investment officer at Harris Private Bank in Chicago, told Bloomberg Television. “We were trying to gain a little bit of traction on the jobs front, to get less bad numbers on a monthly basis. Clearly this month’s report is a setback.”
The S&P 500 tumbled 2.9 percent to 896.42 at 4:29 p.m. in New York, extending its slump since June 12 to 5.3 percent and erasing its 2009 gain. The Dow retreated 223.32 points, or 2.6 percent, to 8,280.74. Fourteen stocks fell for each that rose on the New York Stock Exchange, the broadest decline since May 13. About 734 million shares changed hands on the floor of the NYSE, the slowest trading day of the year.
The S&P 500 lost 2.5 percent over the past four days to cap a third straight weekly drop, the longest stretch of declines since March. The stock market’s slump since June 12 was spurred by concern the S&P 500’s 40 percent surge since March 9 outpaced prospects for a recovery in the economy and corporate profits.
The NYSE close was delayed 15 minutes because of “connectivity problems” today. U.S. markets will be closed tomorrow for the July 4th holiday.
Sector Divergence
A divergence of Dow Jones’s industrial, transportation and utility stock indexes suggests the rebound in the U.S. market may stay stalled near current levels, according to Andrew Burkly, a technical analyst at Brown Brothers Harriman.
The Dow Jones Industrial Average last month rose to the highest reading since January before retreating to a level that was still above the average of the past 50 days until today. The Dow Jones Utilities Average, on the other hand, extended its June rally into this month, hitting a five-month high yesterday. The Dow Jones Transportation Average, while also staying above its 50-day moving average, generated the least bullish pattern by failing to exceed a May high, according to Burkly.
Earnings Season
The second-quarter earnings season will kick off next week with Alcoa, the largest U.S. aluminum producer, reporting results on July 8. Analysts estimate profits in the S&P 500 declined 34 percent in the second quarter and will slump 21 percent on average in the third before rebounding 61 percent in the final three months of the year, according to Bloomberg data.
Home Depot, the biggest home-improvement retailer, lost 3.8 percent to $22.81. Alcoa retreated 4.7 percent to $9.86. Travelers, the insurer that stayed profitable through the credit crisis, slumped 4.7 percent to $39.20.
Lear plunged 52 percent to 23 cents. The company, after reaching an agreement with representatives of lenders and bondholders, said it will “commence shortly” with a Chapter 11 reorganization.
GM IPO
General Motors Corp., the bankrupt automaker selling most of its assets to the U.S. government, may file for an initial public offering of its stock in 2010, according to an adviser to President Barack Obama. GM was in bankruptcy court yesterday seeking approval to sell most of its assets to the Treasury, which is paying for the company with the more than $27 billion in loans it has made to the automaker.
Johnson Controls Inc. slid 9.1 percent to $20.69. The maker of car interiors and batteries was downgraded to “hold” from “buy” at Deutsche Bank AG on concern the stock already reflects the company’s ability to navigate the industry slump.
Monster Worldwide Inc., the world’s largest online recruiting company, tumbled 7.9 percent to $11.06 following the jobs report. The Labor Department figures showed the unemployment rate rose to 9.5 percent, the highest since August 1983, from 9.4 percent.
‘Clearly Disappointing’
“It’s clearly disappointing,” Hugh Johnson, who manages more than $1.5 billion as chairman of Albany, New York-based Johnson Illington, said of the employment data. “I would argue that we’ll have a correction between 5 and 15 percent” in the stock market.
Oil retreated 3.7 percent to $66.72 a barrel, Treasuries rose, sending two-year yields below 1 percent for the first time in almost a month, and the dollar climbed against the euro on speculation a weak labor market will prolong the recession. The Reuters/Jefferies CRB Index of 19 raw materials fell 2.1 percent, led by lower gasoline and crude prices.
All 40 stocks in the S&P 500 Energy Index tumbled. Halliburton Co. and Hess Corp. lost more than 6.3 percent, leading the measure of oil drillers, explorers and equipment suppliers to a 3.6 percent slump.
Elan Corp. jumped 8.6 percent to $7.60. Johnson & Johnson agreed to develop its medicines against Alzheimer’s disease and pay $1 billion for an 18.4 percent stake in the Irish drugmaker.
Benchmark indexes advanced yesterday, adding to gains from the S&P 500’s best quarter since 1998, as improving gauges of manufacturing and home sales added to optimism the worst of the recession is over.
Worrisome Rally
The steepest quarterly rally in value stocks is a bearish sign to some of the largest money managers, who say it shows the equity market has relied on companies with the worst finances to fuel its rebound.
Money-losing companies in the MSCI World Value Index with the most debt climbed an average of 38 percent last quarter, compared with a 20 percent gain for the MSCI World Index, according to data compiled by Bloomberg. That pushed value stocks, or those trading at the lowest level relative to their earnings or assets, in the index up 22 percent, the biggest increase since at least 1995.
Gains will be harder to come by as investors search for profit growth to justify the 41 percent rally in the MSCI World from March 9 through yesterday, according to James Dunigan of PNC Financial Services Group Inc.
Stock investors will monitor the Treasury’s auctions next week to see if demand holds up as Obama pushes the nation’s marketable debt to an unprecedented $6.45 trillion. The Treasury will hold four auctions next week for the first time to sell $73 billion of notes, bonds and inflation-protected securities as the U.S. accelerates debt sales to finance a record budget deficit.

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Interactive Brokers Announces Online Stock Market Trading on the National Stock Exchange of India (NSE)

GREENWICH, Conn.--(BUSINESS WIRE)--Interactive Brokers is pleased to announce the addition of stock trading on the National Stock Exchange of India (NSE) for both Indian national residents and Non-resident Indians (NRI). This adds to Interactive Brokers’ previously announced product additions of options and futures trading in India.

Indian and non-resident Indian clients will now have access to over 80 electronic markets worldwide, including India, from a single platform. Commissions for Indian stocks are just 5 basis points per transaction, subject to a minimum commission of INR75 per transaction plus costs. The commission for Indian options contracts ranges from INR40 to INR60 per contract + costs (e.g., securities transaction costs, exchange/statutory charges, stamp duty and service tax) with INR100 minimum. Indian futures commissions range from 0.015% to 0.035% of the overall trade value + costs with INR100 minimum.

The opening of its Mumbai offices makes India the eighth international location for Interactive Brokers, as it increases to 18 the number of countries in which Interactive Brokers provides electronic trading for its worldwide customer base. The IB Trader Workstation^SM allows investors to view, trade, and manage risk for multiple global asset classes, including Indian stocks, options, and futures, from a single screen.

Gerald Perez, Managing Director of IB’s London office said, “We’re committed to earning the business of active Indian investors and we’re doing this at some of the lowest trading costs available across India. In addition, we are working to provide electronic trading access to Indian, as well as non-Indian, institutions in the near future to help complete our Indian offering.”

Visit our website at www.interactivebrokers.co.in for details on how to open an account or call our Mumbai office at + 91 22 4245 5600 and speak to one of our representatives.

About Interactive Brokers

Interactive Brokers Group, Inc., together with its subsidiaries, is an automated global electronic market maker and broker specializing in routing orders and executing and processing trades in securities, options, futures, foreign exchange instruments, bonds, and funds as a member of more than 80 electronic exchanges and trading venues around the world. The company provides professional traders and investors with electronic access to stocks, options, futures, forex, bonds and funds. Employing proprietary software on electronic exchanges worldwide, Interactive Brokers is continuously integrating its software with a growing number of exchanges and trading venues into one automatically functioning, computerized platform that requires minimal human intervention.

Interactive Brokers (India) Pvt. Ltd is a member of NSE, Member code 12880, SEBI; Regn. No. INB 231288037 (CM), SEBI Regn. No. INF 231288037 (F&O). Supporting documentation for any claims and statistical information will be provided upon request.

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