Financial News

Manufacturing in the Philadelphia region expanded in February for a sixth straight month as orders surged to the highest level in more than five years, another sign that factories are leading the economic recovery.

The Federal Reserve Bank of Philadelphia’s general economic index rose to 17.6 from 15.2. Readings greater than zero signal growth. Measures of employment and shipments accelerated, and inventories expanded for the first time since September 2007.

Surging exports, inventory replenishment and corporate spending on new equipment are fueling a factory-led recovery from the worst recession in seven decades. The manufacturing expansion may spur the labor market recovery needed to boost consumer spending and keep the economy expanding.

“The inventory cycle will continue to add to production levels well into 2010,” said Robert Stein, a senior economist at First Trust Portfolios LP in Wheaton, Illinois. “Manufacturing is doing well pretty much across the board.”

A separate report from the Conference Board today showed the index of U.S. leading indicators rose in January for a 10th straight month, pointing to an economy that will keep expanding through the first half of this year.

The Standard & Poor’s 500 Index increased 0.2 percent to 1,101.53 at 11:11 a.m. in New York. The 10-year Treasury note fell, pushing up the yield five basis points to 3.78 percent.

Other reports from the government showed jobless claims rose by 31,000 to 473,000 last week, while wholesale prices increased 1.4 percent in January after a 0.4 percent gain in December.

Economists’ Forecasts

Economists forecast the Philadelphia Fed’s factory gauge would rise to 17, according to the median of 58 projections in a Bloomberg News survey. Estimates ranged from zero to 23.

The Philadelphia Fed’s employment index rose to 7.4, the highest level since October 2007, from 6.1 the prior month.

The new orders measure rose to 22.7 from 3.2, and shipments climbed to 19.7 from 11.

The index of prices paid fell to 32.4 from 33.2 in January. Prices received increased to 3.7 from 2.7.

The gauge of expectations for the next six months decreased to 35.8 from 43.3 while remaining positive for a 14th straight month.

The overall index number isn’t composed of the individual measures, so some economists consider it a gauge of sentiment among manufacturers.

Two days ago, figures from the New York Fed showed business activity in that region expanded in February at the fastest pace in four months.

Industrial Production

Another Fed report yesterday showed industrial production nationwide rose in January for a seventh straight month. The plant-use rate increased to 72.6 percent, the highest level in more than a year.

The U.S. economy is forecast to grow 3 percent this year, according to the median estimate of economists surveyed by Bloomberg in the first week of February. That follows a 2.4 percent contraction last year as the economy sank into its worst recession in seven decades.

Manufacturers, particularly of exported goods, are seeing a pickup in demand, fueled in part by a 10.7 percent rate of economic growth in China in the fourth quarter.

Latrobe, Pennsylvania-based Kennametal Inc., a maker and distributor of mining, metal-working and energy tools, last month reported an 8 percent increase in fiscal second quarter sales from the prior quarter as the world economy recovers.

“We are continuing to see signs of a slow, but steady global economic recovery,” Chief Executive Officer Carlos Cardoso said on a conference call Jan. 28. “Industrial production activity is higher in most geographical regions, with emerging markets leading the way and mature markets beginning to recover.”

Source

Looking for accurate and precise life insurance quotes that will help you choose the right policy? This is the site where you will find all life insuranceand senior life insurance.

Japan’s economy grew faster than economists anticipated last quarter, reducing the risk of falling back into a recession even as deflation intensifies.

Gross domestic product rose at an annual 4.6 percent pace in the three months ended Dec. 31, the Cabinet Office said in Tokyo today, more than the 3.5 percent median estimate of economists surveyed. The GDP deflator, the broadest measure of prices in the economy, fell a record 3 percent.

Exports led the expansion, aided by a global recovery that prompted manufacturers from Panasonic Corp. to Nissan Motor Co. to raise their profit forecasts this month. An increase in consumer spending may not last as government stimulus measures fade and households expect prices to keep falling along with their wages, said economist Hiroshi Miyazaki.

“The benefits from the global recovery are spilling over,” said Miyazaki, chief economist at Shinkin Asset Management Co. in Tokyo. “The economy will keep recovering even if the government does little to fight deflation, but the risks are heightening that growth ahead will be slow.”

The yen traded at 90.15 per dollar at 3:20 p.m. in Tokyo from 90.03 before the report. The currency has gained 5 percent in the past six months, eroding exporters’ earnings. The Nikkei 225 Stock Average fell 0.8 percent, extending this year’s losses to 5.1 percent.

The world’s second-largest economy expanded 1.1 percent from the previous quarter, today’s report showed, more than the 0.9 percent median estimate of economists surveyed.

Revised to Zero

Third-quarter GDP was revised to zero from an annualized 1.3 percent growth, reflecting a change in how the Cabinet Office calculates exports and imports on a seasonally adjusted basis to account for the global trade collapse in 2008.

Overseas shipments increased 5 percent from the previous three months, the report said. Net exports, or shipments minus imports, added 0.5 percentage point to growth.

“Risks for a double-dip recession are receding,” Finance Minister Naoto Kan told reporters in Tokyo today. “We’re starting to see some bright signs emerge from the clouds, but we can’t be complacent.”

The GDP deflator’s year-on-year decline was the biggest since records began in 1955. Without adjusting for price changes, Japan grew an annualized 0.9 percent from the previous quarter.

The Bank of Japan, amid pressure from politicians, stepped up its fight against deflation in December, saying it “does not tolerate” price declines. Governor Masaaki Shirakawa and his colleagues, who will decide policy on Feb. 17-18, will keep the benchmark interest rate at 0.1 percent for all of 2010, according to all 17 economists surveyed by Bloomberg last month.

‘More Pressure’

“It’s likely that the Finance Ministry will put more pressure on the BOJ to implement more accommodative policies, highlighting today’s figures that point to deflation,” said Miyazaki at Shinkin Asset business cards. “That pressure is likely to run the BOJ into a corner.”

Compounding the woes from deflation, in the past month Standard and Poor’s has warned that the nation’s debt rating may be cut and Toyota Motor Corp., the country’s biggest automaker, has recalled 8 million vehicles because of accelerator and brake problems.

Kan said yesterday that the government will next month begin debating whether to overhaul the sales tax amid concerns about the widening deficit.

Chief Cabinet Secretary Hirofumi Hirano said today that the government must do its utmost to avoid another recession. Prime Minister Yukio Hatoyama, whose Democratic Party of Japan faces an upper-house election in July, received parliament’s approval for a 7.2 trillion yen ($80 billion) stimulus package last month.

Spearheading Revival

Asia spearheaded the export revival, led by China, Japan’s biggest overseas customer, which grew the most since 2007. U.S. demand is also improving after the nation’s GDP expanded the most in six years last quarter. Still, a report last week showed Europe’s economy almost stalled in the period, underscoring the frailty of the world recovery.

Panasonic, the world’s largest maker of plasma televisions, raised its operating profit forecast by 25 percent this month. Flat-panel TV sales rose 48 percent from a year earlier, driven by purchases in regions including China and South America.

Nissan Motor predicted a return to profit this fiscal year, scrapping an earlier loss estimate, citing government incentives that boosted demand for vehicles in China and Japan. The country’s third-largest carmaker expects net income of 35 billion yen in the year ending March 31, compared with an earlier forecast of a 40 billion yen loss.

A separate report today showed industrial production growth in December was revised to 1.9 percent from 2.2 percent.

Consumer Spending

Spending by consumers, which accounts for more than half of the economy, rose 0.7 percent in the fourth quarter, today’s report showed. Business investment climbed 1 percent, the first positive reading in seven quarters.

The gain in capital spending “signals a turning point in the economy toward a sustainable recovery,” said Kyohei Morita, chief economist at Barclays Capital in Tokyo.

Even as exports improve, Japan’s expansion may lose momentum as the effects of stimulus spending at home fade.

“Consumption has been sluggish if you exclude purchases of autos and flat-panel televisions, which have received a direct boost from government stimulus,” said Ryutaro Kono, chief economist at BNP Paribas in Tokyo. “Many households perceive income declines since late 2008 not just as a result of the economy’s growth cycle but as permanent declines.”

Source

Compare and purchase low cost car insurance rates from multiple auto insurance companies immediately online.

Within the next month, a subsidiary of the Erie County Industrial Development Agency is expected to award a new round of loans aimed at aiding minority-run businesses.

David Kerchoff, ECIDA assistant treasurer, said 89 applications were received for this year's $500,000 loan pool, under the minority entrepreneur program. From that, 57 made it to the second round of reviews. A third round whittled the list to 32 potential loan applicants.

From that pool, 10 businesses will likely be selected, Kerchoff said. Loans amounts will vary, according to the company's business plan and needs.

Kerchoff said he expects this year's awards to be named by mid-March.

The loans are run through the IDA's Buffalo and Erie County Regional Development Corp. affiliate. Nine of the 10 businesses that received assistance in the initial 2008 round remain in business. The only failure was the much-publicized One Sunset restaurant on Delaware Avenue, which received a $50,000 loan.

Kerchoff said the IDA remains hopeful it may, someday, see that loan repaid.

"Do we collect it?" Kerchoff said. "It's hard to say at this point."

Source

Richard A. Anderson, a retired group president for global business services at AT&T Inc., has been elected to the board of directors for Computer Services Inc.

Anderson retired from AT&T in June 2007. He since has served as executive director of the Georgia Regional Transportation Authority. He also sits on several boards, including the board of advisors for Murray State University, Murray, Ky.

In his role with the state of Georgia, Anderson is overseeing the creation of the state’s strategic-transportation plan, according to a news release.

Paducah, Ky.-based Computer Services Inc. (Pink Sheets: CSVI) delivers core banking, payment-processing, Internet, card-services, risk-assessment, fraud-prevention, network-management and regulatory-compliance services to more than 4,600 financial institutions and corporations.

Source

Peopleclick, a Raleigh company that makes human resources software, has been purchased by New York private equity firm Bedford Funding for about $100 million, the companies announced Tuesday.

Bedford owns Massachusetts company Authoria Inc., a Peopleclick competitor. Bedford will merge the two makers of human-resources software into a combined entity called Peopleclick Authoria.

Charles S. Jones, managing partner of Bedford Funding, will become chairman and CEO of Peopleclick Authoria, working from the private equity firm's White Plains, N.Y., headquarters. At this point, the new company does not have specific plans to choose a headquarters in either Raleigh or Waltham, a spokeswoman said business?ards.

Bedford bought Waltham, Mass.-based Authoria, in 2008 for $63.1 million and immediately committed to invest $8 million more in the company, which makes talent management software. Peopleclick makes talent acquisition software. Bedford plans to integrate the two companies' products to include more analytics capability, the firm said in a press release.

Source

In a reversal of earlier gains, more states lost jobs than added them in November, signaling that hiring is occurring only sporadically around the country.

Thirty-one states and the District of Columbia suffered a net loss of jobs, the Labor Department reported Friday quick guaranteed personal loans. Nineteen states added jobs in November, down from 28 in October.

Source

Surging stock markets pushed up Canadians’ net worth in the third quarter but debt levels are rising, too, according to a report from Statistics Canada.

The result is a record household debt-to-income ratio of 145 per cent, the agency said.

Household net worth, the value of families’ assets such as cars, homes, and savings accounts, minus what they owe, reached $5.72 trillion at the end of September, StatsCan said Monday.

That’s an increase of 2.3 per cent, marking two quarters of gains after three consecutive drops.

Household debt, mainly mortgages and consumer credit, kept rising from July to September as Canadians rushed to take advantage of low interest rates to buy homes, renovate, and shop. Personal sector liabilities rose to $1.41 trillion, up 1.6 per cent.

National net worth, which includes business and government assets and liabilities, fell 1 No teletrak payday loan.3 per cent to $5.89 trillion as governments and consumers took on more debt, the report said.

Canada’s premier stock market, the S&P/TSX Composite Index rose 9.8 per cent in the third quarter. That’s on top of a 19 per cent gain in the previous three months.

The central bank has made a pledge to stand pat on interest rates until June 2010 to preserve the nascent economic recovery that is taking root. Keeping rates low encourages spending and borrowing, and that spurs economic growth.

Still, the Bank of Canada warned last week that rising debt levels will make Canadian households more vulnerable when interest rates do go up.

Source

The U.S. Treasury Department’s refusal to sell its 34 percent stake in Citigroup Inc. is hampering the bank’s plans to repay $20 billion of remaining bailout funds, people familiar with the bank said.

Executives at the New York-based bank are growing frustrated because they can’t sell stock to raise money for repayment until the Treasury signals when and how it will unload its 7.7 billion shares, said the people, declining to be identified because the matter is under discussion. Investors may be reluctant to buy shares because a Treasury sale could drive down the price.

“The ball is in the government’s court,” said Chris Kotowski, an analyst at Oppenheimer & Co. in New York, who has a “market perform” rating on the bank’s shares. “It’s not Citibank’s decision to sell them or not sell them.”

Bank of America Corp.’s plan to repay $45 billion of bailout funds would leave Citigroup as the only large bank subject to compensation reviews by Treasury paymaster Kenneth Feinberg. Other bailed-out companies under his purview include insurer American International Group Inc. and carmakers General Motors Co. and Chrysler Group LLC.

Citigroup Chairman Richard Parsons said in September that the bank must pay employees competitively to ward off poaching by rivals. Under pressure from Feinberg, the bank cut total 2009 compensation for its 25 highest-paid people by about 70 percent from 2008.

$6 Billion Paper Gain

For almost three months, executives at the bank have tried to persuade Treasury to move ahead with a sale, the people said. At the current market price, the Treasury’s shares are worth about $31.2 billion. Because the common shares were converted from $25 billion of bailout funds, that’s a paper gain of about 25 percent, or more than $6 billion.

Meg Reilly, a Treasury spokeswoman, declined to comment on whether the government has sold any shares or when it may do so. “Treasury does not comment on individual institutions as a general policy,” she said. Citigroup spokesman Jon Diat said he couldn’t comment.

Treasury hasn’t told Citigroup how or when it plans to dispose of the stake, the people said. The shares are held within the department’s Office of Financial Stability, run by Herb Allison, the former chief executive officer of retirement- services firm TIAA-CREF payday loans for bad credit. Allison reports to Treasury Secretary Timothy Geithner.

Pandit’s Vow

Citigroup got a total of $45 billion last year from the Treasury’s $700 billion Troubled Asset Relief Program. In September, $25 billion of that was converted into common stock, which the Treasury is free to sell at any time.

Chief Executive Officer Vikram Pandit, 52, said Oct. 15 he was “focused on repaying TARP as soon as possible.” He said, “We’re going to do so in consultation with the government and our regulators.”

In a report, CreditSights Inc. analyst David Hendler said Citigroup could repay the $20 billion of TARP funds by selling about $10 billion of common stock along with $10 billion or more of junior debt securities. Regulators may be keeping Citigroup in TARP because of lingering concern that the economy won’t recover quickly, Hendler wrote.

The company has almost doubled its cash holdings to $244.2 billion over the past year, the biggest such stockpile of any U.S. bank.

‘Not Cash’

“It’s not a question of cash,” Kotowski said. “It’s a question how much the regulators will force banks to raise to clear themselves of the stigma of being a TARP bank.”

JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley, all based in New York, repaid bailout funds in June. San Francisco-based Wells Fargo & Co., which hasn’t repaid $25 billion of bailout funds, isn’t subject to Feinberg’s rules because it hasn’t received “exceptional assistance.”

Even if the Treasury sold its Citigroup shares and the bank paid off the remaining $20 billion, it still might be subject to the paymaster’s purview because it has $301 billion of government asset guarantees, the people said. Citigroup has no plans to terminate the guarantees, which remain in effect for 10 years on home loans and mortgage-backed securities and 5 years for other types of assets, the people said.

Source

Stocks rallied Tuesday as worries about Dubai’s debt problems eased, gold hit a record above $1,200 and GE and Comcast moved closer to a deal on NBC Universal.

The Dow Jones industrial average (INDU) added 127 points, or 1.2%, closing at the highest point since Oct. 2, 2008. The S&P 500 (SPX) index gained 13 points, or 1.2%, and closed just short of a 14-month high. The Nasdaq composite (COMP) rose 31 points, or 1.5%, and remained short of a 14-month high hit a week ago.

Bets that Dubai’s debt problems won’t have a major impact on U.S. institutions lifted stocks late Monday and through Tuesday’s session. Stocks also reacted to the day’s better-than-expected economic readings on construction spending and pending home sales.

"The market is treating Dubai like a non-event and continuing to trade on momentum," said Joe Clark, market analyst at Financial Enhancement Group.

He said that the momentum is likely to keep stocks aloft or even push them higher through year-end, despite the already substantial run up since the March lows.

Since bottoming at a 12-year low March 9, the Dow has gained nearly 60%, the S&P 500 has gained 64% and the Nasdaq has gained 72%.

Investors also kept an eye on auto sales, which were down from October but mostly higher from a year ago. After the close, GM said CEO Fritz Henderson has resigned and will be temporarily replaced by Chairman Ed Whitacre, until a successor is found.

The weak dollar also played a role in the day’s advance, boosting commodity prices and stocks, continuing a trend that’s been in place all year.

Gold touches $1,200: COMEX gold for December delivery rallied $18 to settle at $1,199.10 an ounce, after rising as high as $1,202.70. It’s the first time the precious metal has ever traded at this level.

Company news: AIG (AIG, Fortune 500) said it is wiping out $25 billion of its government debt by selling stakes in two of its life insurance subsidiaries to the Federal Reserve Bank of New York. Shares gained 8.6%.

General Electric (GE, Fortune 500) has reportedly reached a deal to buy Vivendi SA’s 20% stake in NBC Universal for about $5.8 billion, moving GE closer to its goal of partnering with Comcast (CMCSA, Fortune 500) to create one of the largest U.S. media companies.

GE is looking to sell a 51% stake in NBC Universal to Comcast, while retaining a 49% stake in the company that is valued at around $30 billion.

Dubai and world markets: Dubai World, the city-state’s main investment arm, said it is in talks to restructure $26 billion in debt, cooling worries that it might go into default and wipe out the investment of its creditors.

Global markets slumped last week after the Dubai government asked to defer payments for at least six months on $60 billion in debt owed by Dubai World and Nakheel, its real estate arm.

Overseas markets surged, with London’s FTSE 100, Germany’s DAX and France’s CAC 40 all closing with gains of more than 2%. Asian markets rallied too, with Japan’s Nikkei ending 2.4% higher.

Autos: Major automakers reported sales in November that met or topped expectations. But any improvements year-over-year were easy, given the dismal results in November 2008. On a monthly basis, sales slumped from October levels.

Among the standouts: General Motors reported a 1.8% drop in November sales from a year ago, versus forecasts for a drop of 1.3%. But sales were down 15% from October levels. Ford Motor’s sales were little changed from a year ago and down 10% from October.

ISM index: The November manufacturing index from the Institute for Supply Management fell to 53.6 from 55.7 in October, surprising economists who were looking for ISM to fall to 55. However, any reading over 50 implies expansion in the sector.

Pending home sales: Signed contracts to buy homes rose 3.7% in October, the ninth monthly increase in a row, according to a National Association of Realtors report released Tuesday. Pending home sales were expected to have fallen 1% after rising 6% previously.

Other economic news: Construction spending in October was unchanged, the government reported. Spending fell 1.6% in September and was expected to have fallen 0.5% in October, according to analysts’ estimates.

President Obama is due to announce his strategy on Afghanistan in a speech Tuesday night from West Point.

The dollar and oil: The dollar fell versus the euro and gained against the yen.

U.S. light crude oil for January delivery rose $1.47 to $78.75 a barrel on the New York Mercantile Exchange.

Bonds: Treasury prices tumbled, raising the yield on the 10-year note to 3.27%, from 3.20% late Monday. Treasury prices and yields move in opposite directions.

Market breadth was positive. On the New York Stock Exchange, winners beat losers four to one on volume of 1.13 billion shares. On the Nasdaq, advancers topped decliners by two to one on volume of 2.20 billion shares. 

Source

Cheryl Gray knew she had a problem on her hands when cleaning staff in one of the buildings she was responsible for started showing up to work with masks.

It was the summer of 2003 and severe acute respiratory syndrome, or SARS, had hit Canada’s largest city. By the end of the outbreak there were 443 probable cases, with 44 deaths. Tenants in her Toronto buildings were clamouring for information. Was it even safe to touch the elevator buttons?

Gray, a senior vice-president at Canadian property manager and developer Bentall Capital, knew she had to be prepared if there was a next time. "There was a lot of angst amongst tenants and we really didn’t have a clear game plan on what to do," Gray said.

What Gray did was create what some describe as the gold standard of pandemic planning for commercial buildings in North America.

Gray’s obscure manual is getting more attention today after long lines for H1N1 flu vaccination shots in Ontario created a heightened sense of urgency for Canadian businesses. About 2.5 million people have been vaccinated in three weeks, with 198 deaths across the country.

Apart from the health implications, the virus can have severe consequences on the economy if commercial and retail operations close.

Written in the wake of the SARS epidemic, the manual is considered the go-to document in pandemic preparedness, written on the front lines by property managers like Gray who were at the epicentre of the SARS outbreak.

"We were caught by surprise with SARS, and Cheryl took the initiative to reach out to the industry so we could collectively come up with a game plan," said Diana Osler-Zortea, president of the Building Owners and Managers Association of Canada, which represents commercial real estate landlords.

"We really needed to figure out how you continue to service everyone when all your workers are sick. How would your business continue in the event of an emergency?"

At the time, Gray was responsible for managing 20 million square feet of properties in eastern Canada, mostly in Toronto. After the SARS outbreak, she got in touch with other members of BOMA, a group whose members include major landlords such as Redcliffe Realty, Brookfield Properties and Oxford Properties, and formed a group that met monthly for 18 months to prepare the 95-page document now used by building managers worldwide.

The committee used input from not just real estate experts, but legal, insurance and medical experts as well. Toronto microbiologist Dr. Donald Low is also a consultant.

Ralph Dunham, managing director of risk consultancy Marsh Canada Ltd., said he uses the guide as a good starting point for clients.

"Not only is it a gold standard in the North American real estate industry, but it is valuable to other non-real estate organizations," he said.

"Each company is different, but the principles of preparedness are the same."

The guide looks at basic issues such as how to maintain contact with tenants and employees, preparing for the possibility of closure, travel policies, education and even rent defaults by tenants in the wake of a pandemic.

It discusses whether there is even a legal obligation for owners and building managers to have a pandemic plan. It argues employers have a duty to do this because legislation requires that they maintain a safe workplace.

"We tried to look at everything that could happen," said Gray. "If the cleaning company has a 40 per cent absenteeism rate, how are you going to cope with cleaning the premises effectively? Another example might be that some people may not want to take public transit during an outbreak, so they drive in. How do you respond to the need for extra parking spaces?"

Over the past year the guide has been fine-tuned with more input from stakeholders. Gray says it is necessarily a work in progress as building managers learn from the real world.

"When I finished working on the first manual, I was hoping it would have some value one day. I just didn’t think it would be this soon," said Gray.

"People thought, well, that’s interesting, but I guess it didn’t have the kind of relevance and immediacy it has now."

Source