Editor's Note: My name is Daniel Harrison, and I'm the new Opening Bell writer here at Dealbreaker. Those of you who are readers of the TheStreet.com may remember my daily Asia markets column over there; others may have stopped by my personal blog, which is on the blogroll here. Either way, if you have anything you want to rant/ask/talk/tip about, you can e-mail me now on daniel (AT) dealbreaker (DOT) com.
Global Stocks, U.S. Index Futures Fall as Credit Crisis Widens (Bloomberg)
It looks like it's going to be an ugly morning. S&P futures are off 34 points, at 1073.90, while the Dow and the Nasdaq are both off around 1.5% in futures trading. Mainly it's that payroll report that came out Friday, which pointed to 159,000 jobs vanishing in September. Overseas investors also took a beating in Europe and Asia (see next article). If you're feeling bad about what's going on here however, take heart: European countries from Germany to Greece couldn't even agree on a mutual bailout package and are now going solo with plans to prop up their individual economies (which sort of defeats the point of a European Union, but anyway). That's put the euro at a 13-month low vs. the greenback. ... and you can expect that record to be broken again soon.
Asian stocks plumb depths on a wave of selling (Marketwatch)
Japan's Nikkei had its lowest close since February 2004, while in Hong Kong, the Hang Seng lost 5% and slumped to a 2-year low. In Shanghai, the composite index fell 5.2%. Chinese officials are turning yet more tricks to try and stimulate mainland markets, which are in somewhat of a death spiral, by allowing local companies to issue notes allowing them to buy back their own much-reduced shares. As always in Asia, the scenario is much more severe than it is stateside, but not without its quirks. While Hong Kong-listed shares of Chinese insurance giant Ping An dropped 8%, in Shanghai the shares rose 1%. Oh, and China's regulators seemed to think today made an opportune moment to announce that they will soon allow short-selling.
Bank of America to alter mortgages in $8.4 bln plan (Marketwatch)
From Tel Aviv, Marketwatch reports that BoA has reached an $8.4 billion agreement with an undisclosed number of U.S. states which will allow 400,000 former Countrywide clients to keep their homes. BoA's settlement covers anyone who took out a Countrywide mortgage before December 31, 2007, which seems fair enough. Today's stock futures aside, does this mean we've reached a bottom in the housing crisis? That's going to be the story peddled today, and actually for once, it's not such a bad story to write. BoA's actions will force others to reach the same kind of agreements, which in turn, should raise everyone's spirits over last week's bailout.
Fuld May Blame Confidence Crisis for Lehman's Demise (Bloomberg)
In all the market mayhem, we nearly forgot that it's time for Lehman's top man Dick Fuld's testimony to the House Committee on Oversight and Government Reform today. Bloomberg reports that Fuld is likely to blame a "confidence crisis" in financial shares for Lehman's demise. True or not, that type of testimony is a bit late, and doesn't really help matters. Really, Fuld ought to say that, like everyone, he mistimed the market and that as a consequence, his firm went under. Still, his comments will be notable if it's a volatile day on Wall Street.
Oil falls below $90 as financial turmoil spreads (AP)
Black gold has hit an 8-month low, at around $90 a barrel. So much for the supposedly fireproof predictions of the genius analysts at Goldman Sachs, who said earlier this year that oil would hit $150 a barrel, despite weakening economic conditions. Any explanations?
Cramer: Preventing Great Depression II (TheStreet.com)
Over at TheStreet.com, Jim Cramer is predicting that the Dow may fall as low as 5,000 points, while the U.S. economy falls into a Great Depression. He has some advice for policy officials, which you can find out by reading the article. This "worst crisis since the Great Depression" talk is odd: it's as if everyone has skipped over the late 1970's-early 1980's in their economic history books. Double digit inflation? Rising interest rates? 11% unemployment? That was the worst crisis since the 1930's ... and we're still a long way away.
Has Steve Jobs built a secret MacBook factory? (CNN Money)
On Friday, you may remember, Apple lost more than 5% after an alleged "citizen journalist" posted a rumor on CNN's iReport stating that Steve Jobs had had a heart attack. You would have thought that with with an SEC investigation on its heels for peddling false market information, and after much embarrassment, CNN doesn't want any more to do with Apple rumors for a long time. Well ... apparently not! Here's a report on CNN Money about how Steve Jobs may have built a secret MacBook factory -- without the knowledge of Apple's many millions of shareholders -- in order to produce a new line of MacBook Pro's to be released later this month.
Google Deal With Yahoo Draws More Opposition (New York Times)
Not that this is most people's priority news this morning, but it's all too easy to overlook the small nuggets of news amidst a market crisis. Advertisers are apparently worried about price hikes in the event of a Google/Yahoo synergy. I've been hearing increasing talk among web owners about the failure of Google's adwords and other programs to provide valuable earnings. You can't help but see this latest Yahoo tie-up as more of a defensive one on Google's part than anything else.
Wachovia may be split between Citigroup, Wells Fargo (Press Trust of India)
Given that there is pretty much only one place you can find this story, it may be worth taking it with a pinch of salt. Either way, PTI reports that execs are hashing out a deal to sell the northwestern branches of Wachovia to the snubbed Citigroup, with the brokerage and asset management arm going to Wells Fargo, as previously reported.
Posted by guest, Oct 06, 2008 7:36AM
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