Joined Feb 3, 2009
1,759 Blog Posts

Case Shiller Home Price Index: Prior – 15.44% / Mkt Expects – 14.20% / Actual -13.3% …. Consumer Confidence: Prior 54.1 / Mkt Expects 57 / Actual 53.1 … Plus Earnings From DRI*, JBL*, MU*, NKE*, & WAG*


Darden Restaurants Inc. beat analyst estimates on earnings per share with a 16 percent jump, but fell short on revenue forecasts for its fiscal first quarter.

Orlando-based Darden (NYSE: DRI) reported net income of $94.3 million, or 67 cents per share, on revenue of $1.73 billion for the period ended Aug. 30. That compared with net income of $82.1 million, or 58 cents per share, on revenue of $1.77 billion for the same period last fiscal year.

Analysts surveyed by Thomas Reuters estimated the restaurant operating firm to earn 66 cents per share on revenue of nearly $1.8 billion.

Darden also posted same-restaurant sales drops across all five of its reporting restaurant brands. The Capital Grille led the way with an 18 percent decline, partially offset by the addition of five net new restaurants.

Red Lobster followed with a 7.9 percent drop, partially offset by revenue from 11 net new restaurants; Bahama Breeze and LongHorn Steakhouse followed with declines of 6.3 percent and 6.2 percent, respectively; and Olive Garden posted a 2.9 percent drop in same-restaurant sales.

Blended same-restaurant sales for Olive Garden, Red Lobster and LongHorn Steakhouse were down 5.3 percent this quarter, better than the estimated decline of 7.8 percent for the Knapp-Track benchmark of U.S. same-restaurant sales, excluding Darden.

Olive Garden was the lone brand to experience an increase in fiscal first-quarter sales, which were 1.2 percent higher than the prior year at $821 million. The other restaurant brands sales were as follows:

• Red Lobster’s $605 million in sales was 6.3 percent lower than the same period last fiscal year.

• LongHorn Steakhouse reported $211 million, 2 percent below a year ago.

• The Capital Grille had $50 million in revenue, 8.4 percent below last fiscal year.

• Bahama Breeze posted $35 million, 1.5 percent below the prior year.

“Despite the challenges, our brands once again posted meaningfully stronger sales results than our industry,” Chairman and Chief Executive Officer Clarence Otis said in a prepared statement.

Darden’s board of directors declared a quarterly cash dividend of 25 cents per share on the company’s outstanding common stock. The dividend is payable on Nov. 2 to shareholders of record at the close of business on Oct. 9.

Darden Restaurants, which operates 1,778 total restaurants worldwide as of Aug. 30, reported $7.2 billion in fiscal 2009 annual sales.


NKE revs light, but beats by 7 cents on bottom line


Select First Quarter Results:

  • Revenue $4.8 billion; down 12 percent versus prior year or down 7 percent excluding currency changes
  • Diluted EPS up 1 percent from prior year to $1.04
  • Worldwide futures orders down 6 percent, down 4 percent excluding currency changes
  • Inventories down 7 percent versus prior year

NIKE, Inc. (NYSE:NKENews) today reported financial results for its fiscal 2010 first quarter ended August 31, 2009. First quarter revenues decreased 12 percent to $4.8 billion, compared to $5.4 billion for the same period last year. Excluding changes in currency exchange rates, net revenue was down 7 percent compared to the same period last year. First quarter net income was flat compared to the prior year at $513 million and diluted earnings per share increased 1 percent to $1.04.

“We delivered a good start to the fiscal year,” said Mark Parker, NIKE, Inc. President and Chief Executive Officer. “These results illustrate that the emotion of sports, combined with innovative product, strong brands and premium retail experiences can make powerful connections to consumers even in challenging times.”

Parker concluded, “Leveraging these powerful consumer connections with a laser focus on operational excellence will enable Nike to deliver consistent long-term profitable growth. We’re on the right track, moving forward with confidence in hand and opportunity in mind.”*

Futures Orders

The Company reported worldwide futures orders for Nike brand athletic footwear and apparel, scheduled for delivery from September 2009 through January 2010, totaling $6.2 billion, 6 percent lower than orders reported for the same period last year. Excluding currency changes, reported orders would have declined 4 percent.*

By geography, futures orders were as follows:


Reported Futures Orders

Excluding Currency Changes

North America -4% -4%
Western Europe -8% -6%
Central and Eastern Europe -28% -24%
Greater China -6% -7%
Japan -3% -5%
Emerging Markets +10% +18%

Geography Highlights

North America

During the first quarter, revenues in North America decreased 5 percent to $1.8 billion. Footwear revenues declined 4 percent to $1.2 billion, apparel revenues decreased 9 percent to $444 million and equipment revenues were down 5 percent to $98 million. Excluding changes in currency, revenues for North America declined 5 percent with footwear down 3 percent, apparel decreasing 8 percent and equipment dropping 5 percent. North America earnings before interest and taxes (commonly referred to as “EBIT”) increased 10 percent to $411 million due to lower selling and administrative expenses and improved gross margins.

Western Europe

First quarter revenue for Western Europe was down 18 percent to $1.1 billion. Footwear revenue decreased 15 percent to $635 million, apparel revenue was down 21 percent to $393 million and equipment revenue declined 26 percent to $77 million. Revenue for Western Europe, excluding currency changes, was down 8 percent with footwear declining 5 percent, apparel dropping 11 percent and equipment decreasing 17 percent. First quarter EBIT decreased 11 percent to $289 million.

Central and Eastern Europe

In the first quarter, revenue for Central and Eastern Europe declined 33 percent to $286 million. Footwear revenue decreased 32 percent to $159 million, apparel revenue was down 37 percent to $97 million and equipment revenue declined 29 percent to $30 million. Excluding currency changes, revenue in Central and Eastern Europe was down 23 percent compared to the same period last year with footwear declining 21 percent, apparel dropping 28 percent and equipment down 16 percent. First quarter EBIT decreased 35 percent to $82 million.

Greater China

Revenue for Greater China during the first quarter was down 16 percent to $416 million compared to $496 million last year. Footwear revenue was down 17 percent to $218 million, apparel revenue declined 16 percent to $168 million, and equipment revenue decreased 16 percent to $29 million. Excluding currency changes, revenue for Greater China was down 17 percent from last year with footwear down 17 percent and both apparel and equipment declining 16 percent. First quarter EBIT increased 7 percent to $149 million mainly driven by lower demand creation spending. Last year’s first quarter demand creation spending was higher in support of the Olympic Games in Beijing.


Japan first quarter revenues were essentially flat compared to the prior year at $186 million. Footwear revenue was up 4 percent to $98 million, apparel revenue dropped 8 percent to $67 million and equipment revenue increased 5 percent to $22 million. Excluding currency changes, Japan first quarter revenues were 10 percent lower than last year with footwear down 6 percent, apparel down 17 percent and equipment dropping 5 percent. First quarter EBIT decreased 7 percent to $35 million.

Emerging Markets

In the Emerging Markets revenue decreased 8 percent to $422 million for the first quarter compared to $458 million last year. Footwear revenue was down 6 percent to $279 million, apparel revenue dropped 9 percent to $107 million and equipment revenue decreased 19 percent to $36 million. Excluding currency changes, revenue in the Emerging Markets increased 9 percent compared to last year with 11 percent growth in footwear, a 9 percent increase of in apparel and a 4 percent drop in equipment. Despite declining reported revenue, first quarter EBIT rose 39 percent to $101 million due to lower selling and administrative expenses.

Other Businesses

For the first quarter, Other business revenue, which includes Cole Haan, Converse Inc., Hurley International LLC, NIKE Golf, and Umbro Ltd. decreased 5 percent to $604 million. Excluding currency changes revenue was down 3 percent. EBIT was flat to last year at $87 million….



BOISE, Idaho–(BUSINESS WIRE)–Micron Technology, Inc., (NYSE:MUNews) today announced results of operations for its fourth quarter and 2009 fiscal year, which ended September 3, 2009. For the fourth quarter of fiscal 2009, the company posted a net loss of $88 million, or $0.10 per diluted share, on net sales of $1.3 billion. For the 2009 fiscal year, the company posted a net loss of $1.8 billion, or $2.29 per diluted share, on net sales of $4.8 billion. In the fourth quarter and for the 2009 fiscal year, the company generated $357 million and $1.2 billion, respectively, in cash flows from operations. The company ended the year with $1.5 billion in cash and investments.

“The market, while still challenging, is beginning to improve. Micron has been one of the only companies in the industry able to generate positive operating cash flow every quarter during this downturn. Our operating performance and ongoing cost improvements put Micron in a great competitive position going forward,” said Steve Appleton, Micron Chairman and CEO.

Revenue from sales of DRAM products increased 28 percent in the fourth quarter compared to the third quarter due to a 19 percent increase in sales volumes and an 8 percent increase in average selling prices. Revenue from sales of NAND Flash products increased 10 percent in the fourth quarter compared to the third quarter due to a 23 percent increase in sales volumes. This was partially offset by an 11 percent decrease in average selling prices resulting primarily from reduced manufacturing costs associated with products sold to Intel Corporation, the company’s NAND Flash manufacturing partner. Prices for NAND Flash products sold to Intel approximate cost, which decreased significantly in the fourth quarter compared to the third quarter as the transition to the company’s 34 nanometer (nm) NAND process technology was substantially completed. Average selling prices for NAND Flash sales excluding those to Intel were relatively stable in the fourth quarter compared to the previous quarter.

The company’s gross margin on sales of memory products continued to improve from 11 percent in the third quarter of fiscal 2009 to 12 percent in the fourth quarter. Cost of goods sold in the fourth quarter includes approximately $37 million of charges for unused production capacity at the company’s Inotera and IM Flash joint ventures. There was no lower of cost or market write-down of memory inventories during the third or fourth quarters. When adjusted to exclude the effects of selling products subject to previous lower of cost or market write-downs and the idle capacity costs from Inotera and IM Flash, gross margins on sales of memory products improved to positive 8 percent in the fourth quarter compared to negative 12 percent in the third quarter as a result of significant decreases in per gigabit manufacturing costs.

Unit sales from the company’s imaging segment were approximately 30 percent higher in the fourth quarter as compared to the preceding quarter, the effect of which was essentially offset by a decline in the average selling price resulting from the transition during the quarter to wafer foundry sales of products. Gross margin on sales of imaging products however improved to 20 percent in the fourth quarter as compared to 2 percent in the third quarter primarily as a result of increased utilization of dedicated 200 millimeter (mm) manufacturing capacity.

The company will host a conference call today at 2:30 p.m. MDT to discuss its financial results. The call, audio and slides will be available online at www.micron.com. A webcast replay will be available on the company’s Web site until Sept. 29, 2010. A taped audio replay of the conference call will also be available at 706-645-9291 (conference number: 30898947) beginning at 5:30 p.m. MDT today and continuing until 5:30 p.m. MDT on Oct. 6, 2009.



ST. PETERSBURG, Fla.–(BUSINESS WIRE)–Jabil Circuit, Inc. (NYSE:JBLNews), reported its preliminary, unaudited financial results for the fourth quarter and fiscal year 2009, ended August 31, 2009. “Marked improvement in our sequential performance was aided by cost cutting, increased productivity, market share gains and a more benign end-market environment. Income gains were matched with cash flow generation and balance sheet improvements during the quarter,” said President and CEO Timothy L. Main.

Net revenue for the fourth fiscal quarter of fiscal 2009 was $2.8 billion compared to $3.3 billion for the same period of fiscal 2008. GAAP operating income for the fourth quarter of fiscal 2009 was $43.1 million compared to income of $87.8 million for the same period of fiscal 2008. GAAP net income for the fourth quarter of fiscal 2009 was $5.5 million compared to net income of $57.5 million for the same period of fiscal 2008. GAAP diluted earnings per share for the fourth quarter of fiscal 2009 were $0.03 compared to $0.28 for the same period of fiscal 2008.

Core operating income for the fourth quarter of fiscal 2009 was $65.4 million or 2.3 percent of net revenue compared to $104.7 million or 3.2 percent of net revenue for the fourth quarter of fiscal 2008. Core earnings for the fourth quarter of fiscal 2009 were $33.4 million compared to $61.7 million for the same period of fiscal 2008. Core earnings per diluted share for the fourth quarter of fiscal 2009 were $0.16 compared to $0.30 for the same period of fiscal 2008.

Fiscal Year 2009

Net revenue for the fiscal year was $11.7 billion compared to $12.8 billion for fiscal 2008.

GAAP operating income for fiscal 2009 was a loss of $910.2 million compared to income of $251.4 million for fiscal 2008. GAAP net loss for fiscal 2009 was $1.2 billion compared to net income of $133.9 million for fiscal 2008. GAAP diluted loss per share for fiscal 2009 was $5.63 compared to earnings per share of $0.65 for fiscal 2008.

Jabil’s fiscal 2009 core operating income was $246.8 million or 2.1 percent of net revenue compared to $379.9 million or 3.0 percent of net revenue for fiscal 2008. Core earnings for fiscal 2009 were $132.0 million compared to $231.0 million for fiscal 2008. Core earnings per diluted share for fiscal 2009 were $0.63 compared to $1.12 for fiscal 2008.



Though its fourth-quarter profit slipped 2% from a year ago, the company reported results that still topped Wall Street expectations, sending its shares soaring 9.5% to $37.42 in pre-market trading Tuesday.

In the just-ended quarter, Walgreen said it earned $436 million, or 44 cents a share, compared with $443 million, or 45 cents a share, a year ago. Analysts expected the company to earn 39 cents a share.

Sales jumped 8% to $15.7 billion from $14.6 billion, while same-store sales increased 2.4%. The drugstore received a boost from higher prescription-drug sales, which rose 4.5% at stores opened at least a year. Front-end same-store sales, however, fell 1.4%.

Last week, rival Rite Aid(RAD Quote) reported yet another loss in its second quarter and lowered its full-year outlook.

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Business Headlines For September 29, 2009

SKS Offers Dilution

NEW YORK–(BUSINESS WIRE)–Saks Incorporated (NYSE: SKSNews) (“Saks” or the “Company”) today announced that it is offering to sell, subject to market and other conditions, $100 million in shares of its common stock pursuant to an effective shelf registration statement in an underwritten public offering. Saks also is granting the underwriters a 30-day option to purchase up to an aggregate of $15 million in additional shares of common stock. All of the shares in the offering are to be sold by Saks. Morgan Stanley & Co. Incorporated, Goldman, Sachs & Co. and Wells Fargo Securities, LLC are acting as bookrunners…….


GOOG Gets A Boost From The Street

Yet another analyst raising expectations for Google’s Q3: RBC’s Ross Sandler is the latest to increase estimates, citing strong international checks.

Specifically, the UK search market is trending “flat to slightly up” over last quarter, Germany is up “mid single digits” and France is doing even better, Sandler writes in a note today. Those three regions represent about 30% of Google’s overall sales, he estimates.

As a result, he thinks Google’s overall net revenue could grow 5.5% quarter-over-quarter, up from his previous estimate of 3%. “Some of this is likely factored into shares, but we continue to view Google as a must-own in large cap Internet,” he says.


Fed’s Fisher States Policy Reversal Could Be Swift

By Ros Krasny

DALLAS (Reuters) – Dallas Federal Reserve President Richard Fisher said on Tuesday that the winding down of the Fed’s accommodative monetary policies needed to start as soon as the economy shows convincing signs of traction.

“When it comes time to tighten monetary policy, my colleagues and I will move with an alacrity that, if needed, will be equal in speed and intensity to that with which we pursued monetary accommodation,” Fisher said in a speech to the Texas Christian University Business Network of Dallas.

Fisher’s suggestion of a swift reversal in policy echoed comments made last week by Fed Governor Kevin Warsh.

Since then, financial markets have started to anticipate more aggressive increases to the Fed’s target interest rates, which have been set near zero since December 2008.

Derivatives prices suggest the fed funds rate will be raised to 0.75 percent by mid-2010.

The policymaker did not hint at when the Fed’s policies will start to be reversed but he expressed “cautious optimism” about the economy in general and the housing market in particular.

“There is some concern that the hope for a housing rebound could succumb to the headwinds experienced earlier if the efforts of fiscal and monetary authorities are allowed to expire. Yet, that said, there is, in my opinion, a limit to the life support that can be provided,” he said.

The market for housing will not become truly robust until market forces replace government support, Fisher said.

“We have thus indicated to the marketplace that, for our part, the FOMC expects we will complete the execution of our $1.25 trillion intervention in the mortgage-backed securities market by the end of the first quarter of next year.”

Fisher is not a voting member of the Federal Open Market Committee in 2009.


Climate Change Legislation is Shaking Up Big Biz

By Daniel Whitten

Sept. 29 (Bloomberg) — PG&E Corp. quit the U.S. Chamber of Commerce. Nike Inc. and Johnson & Johnson criticized the group for its stance. Duke Energy Corp. resigned from the National Association of Manufacturers.

Climate-change legislation is splitting the U.S. business community as few initiatives have in recent years. Groups such as the Chamber of Commerce, more accustomed to tangling with unions and environmentalists, find themselves facing off with prominent members who are defecting or joining new organizations to promote and shape legislation.

The chamber and the manufacturers’ association oppose President Barack Obama’s effort to win passage of a “cap-and- trade” system that would limit carbon emissions to curb global warming. The groups say the proposal amounts to a tax that would cripple the economy. The chamber says the science used to document global warming should be re-examined.

Peter Darbee, PG&E’s chief executive officer, cited the chamber’s “extreme rhetoric and obstructionist tactics” in a resignation letter to Tom Donohue, president and CEO of the Washington-based group, made public last week.

“Climate change is central to a lot of companies’ business models, so what happens is that the CEOs have been personally involved,” said Michael McKenna, president of MWR Strategies, a Washington consulting firm, in an interview. That makes companies less likely to leave the issue to trade associations such as the chamber, he said…..


U.S. Firms Oppose Short Selling Rules

Vanguard Group and Goldman Sachs are among U.S. companies objecting to new rules to limit short selling that are under consideration by the U.S. Securities and Exchange Commission (SEC), the Wall Street Journal reported, citing letters filed last week.

The objections come on the heels of an SEC request for comments on a proposal for reinstating a short-selling restriction called the “uptick” rule, where investors can only short a stock after it rose or ticked higher, the paper said.

Last month, the SEC sought comment on a revised approach to limit short selling, an investment strategy blamed by some lawmakers and company executives for worsening the financial crisis and driving down share prices.

“We’ve always felt that short-sellers enhance liquidity and provide a positive impact on the marketplace,” the paper quoted Gus Sauter, chief investment officer at Vanguard, as saying.

Vanguard, Goldman Sachs, cnbc_comboQuoteMove(‘popup_GS_ID0EJAAC15839609’);[GS 182.568 0.068 (+0.04%) ]
and the SEC were not available for comment.


Wilbur Ross Calling For a Second Stimulus Package

The US economy needs another cash infusion to take off, as the first stimulus package was insufficient to help the US consumer start spending, and longer-term it needs to devalue the dollar, investor Wilbur Ross told CNBC Tuesday.

President Barack Obama’s efforts to kick-start the economy by programs such as cash for clunkers need to be followed by “more dramatic” efforts, Ross told “Squawk Box.”

“The consumer is about 70 percent of the economy and is still disabled. The consumer can’t borrow… and I believe that Obama will have to go for another stimulus package, probably in the spring, because I don’t think unemployment is going to get that much better by then,” he said.

The dollar should probably be devalued because the US is less competitive than other economies and has higher debt, and “some form of SDR” should become the world’s reserve currency, according to Ross.

“I think the way out of it, frankly, is going to be the devaluation of the dollar. The tricky question is :where is the strong currency against which we devalue?”

Although earnings were better than expected in the last quarter, companies will continue to face hardship. (Click on the video on the left for more Ross comments)

“I really think that corporate America is doing better than economic America. Mostly it’s the flip side of the joblessness. Company earnings I think are going to continue to outperform the economy for a little while,” Ross said, but added that consumers are “more leveraged now than at the peak of the boom” because the value of their assets fell.

“I think it’s really going to be that we will continue the massive transfer of liabilities from private sector to public sector” and this is how the economy will deleverage, Ross said.

Some analysts and politicians have said that the $787 billion, two-year stimulus package approved in February will take time to work its way through the economy and no more money was needed.


Asian Markets Move Higher With Taiwan in the Lead

By Jonathan Burgos

Sept. 29 (Bloomberg) — Asian stocks rose, lifting the MSCI Asia Pacific Index from a two-week low, as the dollar advanced against the yen and Taiwan said it may allow Chinese investors to buy stakes in its flat-panel and computer-chip industries.

Nissan Motor Co., which gets 36 percent of its sales from North America, gained 3.3 percent as a stronger dollar bolstered the outlook for U.S. profit. Taiwan Semiconductor Manufacturing Co. jumped 4.9 percent in Taipei on speculation Chinese investors will purchase shares in the company. Commonwealth Bank of Australia added 2.1 percent after the government reported lower- than-forecast budget deficit figures.

The MSCI Asia Pacific Index rose 1.1 percent to 117.20 as of 6 p.m. in Tokyo after closing yesterday at its lowest since Sept. 15. The measure had fallen 2.4 percent in the past three days, the longest series of declines since the six days ended July 8. The gauge has risen 66 percent from a five-year low on March 9.

“There hasn’t been much pullback in the market as investors are probably expecting third-quarter earnings to be better than estimated,” said Pearlyn Wong, Singapore-based investment analyst at Bank Julius Baer Co., which manages about $350 billion. “We still prefer Asian equities. The U.S. has a long way to go before the economy normalizes.”

Japan’s Nikkei 225 Stock Average climbed 0.9 percent to 10,100.20 even as the statistics bureau reported that the country’s consumer prices fell at a record pace in August. Nomura Holdings Inc., which announced a record share sale last week, climbed 4.4 percent for its first gain in 10 trading days…..

European Markets Trade Mixed on Lower Technology & Commodity Shares

By Daniel Hauck

Sept. 29 (Bloomberg) — European stocks declined, led by Siemens AG after the company’s Chief Financial Officer Joe Kaeser said fiscal 2009 was a “tough” year and that order bookings in the year that ends this month will fall.

The Dow Jones Stoxx 600 Index slid 0.4 percent at 10:29 a.m. in London after earlier rising as much as 0.3 percent. Siemens slipped 2.6 percent in Frankfurt. Kaeser spoke to investors at a meeting in London.

Oil Trades Flat Near $67pb

By ALEX KENNEDY p {margin:12px 0px 0px 0px;}

SINGAPORE (AP) – Oil prices hovered near $67 a barrel Tuesday in Asia as regional stock markets rebounded and investors awaited a slew of data on the U.S. economy.

Benchmark crude for November deliver was up 14 cents at $66.98 by late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 82 cents Monday to settle at $66.84.

Regional stock markets, often a barometer of optimism about economic prospects, rebounded from a sharp fall Monday after corporate takeovers boosted Wall Street to a higher close.

Also pushing up oil prices was the West’s recent stern warning to Iran over a previously unknown nuclear facility. About 20 percent of the world’s crude moves through the Straits of Hormuz on Iran’s southern coast and any showdown between the West and Iran could threaten that route.

“Investors are still buying on dips around the mid-$60s level. Most people are reasonably confident that over the next 12 months oil is going to move higher,” said Ben Westmore, energy analyst with National Australia Bank in Melbourne. “The gains in the U.S. equity markets also helped.”

Westmore expects oil will average $80 a barrel in the third quarter of 2010.

“We’re expecting a long recovering period, not a V-shaped recovery, but over 2010 we expect positive outcomes in the big developed economies, and oil demand will pick up,” he said.

In the U.S., the most closely watched indicator this week will be the Labor Department’s monthly jobs report on Friday. Reports also are due out on home prices, manufacturing, consumer confidence, construction spending and factory orders.

In other Nymex trading, heating oil fell 0.55 cent to $1.69 a gallon. Gasoline for October delivery was steady at $1.63 a gallon.

In London, Brent crude rose 10 cents to $65.65 the ICE Futures exchange.

Dollar Trades Flat To Higher Against Other Major Currencies

During early European deals on Tuesday, the dollar showed mixed trading against its major counterparts. The dollar recouped its Asian session’s loss against the currencies of Europe, U.K. and Switzerland. The dollar thus jumped to a 15-day high against the euro. Meanwhile, the dollar eased from an early Asian session’s 4-day high against the yen.

Investors now look forward to the New York session, in which the S&P/Case-Shiller home price index is scheduled to be released at 9 am ET. Economists expect a 14.20% year-over-year decline in the 20-city composite house price index for July.

At 10:00 am ET, the Conference Board is scheduled to release its consumer confidence report for September. The report is expected to show that the consumer confidence index rose to 57 in September.

The dollar gained against the euro after touching a low of 1.4647 at 1:20 am ET Tuesday. The dollar rose to a 15-day high of 1.4559 per euro by about 4:00 am ET and this may be compared to Monday’s closing value of 1.4623. On the upside, 1.445 is seen as the next target level for the U.S. currency.

Euro-zone economic sentiment rose to 82.8 in September, up from a revised reading of 80.8 in August and the expected level of 82.5, a monthly survey from the European Commission showed tosday. However, the indicator stood well below its long-term average.

At 3:45 am ET Tuesday, the dollar reached 1.5850 against the pound, up from an Asian session low of 1.5959. If the dollar advances further, it may find near term resistance around the 1.578 level. At yesterday’s close, the pound-dollar pair was quoted at 1.5890.

The UK economy contracted 0.6% sequentially in the second quarter, the latest report from Office for National Statistics showed today. The second quarter decline was revised up from a 0.7% fall due to upward revisions to construction output.

On a yearly basis, gross domestic product dropped 5.5% in the second quarter, unchanged from the previous estimate. Annual decline was the biggest since records began in 1955.

Bouncing back from an Asian session low of 1.0316 against the Swiss franc, the dollar climbed to 1.0377 during early European deals on Tuesday. The near term resistance for the dollar-franc pair is seen at 1.042. The pair was worth 1.0327 at yesterday’s close.

The franc declined as the UBS consumption indicator suggested today that the private consumption in Switzerland is likely to weaken in the coming months.

Down Under Dollar & Markets Climb to Their Highest Levels

By Candice Zachariahs

Sept. 29 (Bloomberg) — The Australian dollar rose for a third day, approaching its strongest level in 13 months, as traders added to bets the central bank will raise interest rates this year. New Zealand’s currency gained.

The so-called Aussie strengthened for a second day against the yen as futures showed a more than 60 percent chance that the central bank will raise its benchmark rate by half a percentage point by December. Australia’s budget deficit was A$27.1 billion ($23.7 billion) for the year ending June 30, less than the May estimate of A$32.1 billion, Treasurer Wayne Swan said today.

“The Aussie has been supported by expectations of near- term rate hikes,” said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia, the nation’s largest lender by assets. “There’s a good chance that between now and the end of the year we’ll spike up to 90 U.S. cents.”…..

Australian Markets

By Kana Nishizawa

Sept. 29 (Bloomberg) — Australian stocks rose to the highest level in almost a year, led by banks, after the government reported the budget deficit was less than expected.

Commonwealth Bank of Australia, the nation’s second-largest bank by assets, gained 2.1 percent, while National Australia Bank Ltd. added 2 percent. BHP Billiton Ltd., the world’s largest mining company, advanced 2.4 percent after metal prices climbed. Santos Ltd., Australia’s third-largest oil and gas producer, added 1.9 percent after crude oil prices gained.

“Australia’s less-than-expected budget deficit certainly is giving the market a positive impact,” said Ben Potter, a research analyst at IG Markets Ltd. in Melbourne. “Materials and resources will be strong because of their exposure to the global economy.”

The S&P/ASX 200 Index rose 1.6 percent to 4,753.10 in Sydney, its highest close since Oct. 2. New Zealand’s NZX 50 Index climbed 0.8 percent to 3,155.39 in Wellington….

Deflation Concerns Rise Amid Japan’s CPI Falling 2.4%

By Aki Ito and Mayumi Otsuma

Sept. 29 (Bloomberg) — Japan’s consumer prices fell the most in at least 38 years in August, heightening the risk that prolonged deflation may hamper the country’s recovery from its deepest postwar recession.

Prices excluding fresh food slid 2.4 percent from a year earlier, topping July’s 2.2 percent decline, the statistics bureau said today in Tokyo. The drop, the sharpest since the survey began in 1971, matched economists’ estimates.

Companies from Fast Retailing Co. to Sony Corp. are lowering prices to attract consumers who face record unemployment and plunging wages. A return to the deflation that the economy only shook off in 2005 may weigh on growth as consumers and companies cut back spending in anticipation that prices will keep falling.

“We’ll soon start to see that there isn’t enough domestic demand to push up wages,” said Kyohei Morita, chief economist at Barclays Capital in Tokyo. “As households’ spending power falls, there’s concern that this deflation will lead to further deflation — in other words, that we’ll enter into a deflationary spiral.”

The yen’s rally to an eight-month high also threatens to stunt the recovery by making Japanese exports more expensive and eroding the value of repatriated profits. Japan’s currency traded at 89.96 per dollar at 9:53 a.m. in Tokyo from 89.63 before today’s report and rose as high as 88.24 yesterday, the strongest since January.

Record Unemployment…..

China’s Central Bank Pledges To Keep Monetary Policy Loose

By Bloomberg News

Sept. 29 (Bloomberg) — China will stick to a “moderately loose” monetary policy and guide reasonable loan growth to further cement its economic recovery, the central bank said.

The country will continue to implement stimulus measures to boost domestic demand, the People’s Bank of China said after its quarterly monetary policy meeting today. China’s economic rebound isn’t solid, and the country still faces weak external demand, the bank said.

Growth in China’s new lending has slowed in the past two months after the government increased scrutiny over loans and bank assets to prevent bad debt from building up and head off asset-price inflation. A credit boom and a 4 trillion-yuan ($586 billion) stimulus package spurred economic growth to a 7.9 percent annual rate in the second quarter.

“The central bank is unlikely to indicate a policy change and will monitor economic recovery and the trend of inflation for the rest of this year,” said Peng Wensheng, head of China Research at Barclays Capital in Hong Kong. Today’s statement “indicates that the bank is comfortable with the slower loan growth over the past couple of months.”…

China Ocean Shipping Expects Baltic Dry Index To Recover by Year End

By Kim Kyoungwha

Sept. 29 (Bloomberg) — The Baltic Dry Index, the main measure of shipping costs for commodities, may surge more than 80 percent by the end of the year on increased demand for shipments to China, according to China Ocean Shipping (Group) Co.

The gauge may rebound to 4,000 points as local governments encourage factory output, especially of steel, Kong Fanhua, a senior researcher at the company, said in an interview. “If you believe in a China story, believe in a recovery in the shipping market,” Kong said today. The index ended yesterday at 2,192.

Iron ore is the biggest dry-bulk cargo moved by sea, and China is the top consumer of the steelmaking material. The Baltic Dry Index, regarded by some investors as a proxy for shifts in global commodity demand, peaked this year at 4,291 in June as China’s stimulus package revived demand.

Talks on contract iron prices for next year between suppliers and Chinese mills may drive vessel bookings, Kong said in Singapore, where he’s attending an industry conference. The fourth quarter is also the “traditional high season” for coal consumption, which should boost the shipping trade, he said.

“China’s government can’t stop the current policy of expansion,” said Kong. State-held China Ocean Shipping owns the world’s largest operator of dry-bulk ships. “It’s just like driving a car on a mountain: if you stop in the middle of the mountain, you’ll slide down backward.”

‘Critical Phase’……

PIMCO Favors Medium Term Japanese Bonds

By Wes Goodman

Sept. 29 (Bloomberg) — Pacific Investment Management Co., which runs the world’s biggest bond fund, said it is favoring mid-term government debt in Japan and the new government there may allow the yen to appreciate.

The policies of the Democratic Party of Japan will probably boost economic growth in 2010 and 2011 before weighing on the expansion from 2012 through 2014, Tomoya Masanao, an executive vice president in Tokyo, wrote in a report on Pimco’s Web site. The Bank of Japan, which cut its target for overnight lending to 0.1 percent in December, will probably keep interest rates low for a “considerable period” to foster growth, the report said.

“The BOJ’s policy of low rates for an extended period of time coupled with the potential downside risks in the economy suggest the intermediate part of the Japanese government bond curve will continue to be a prudent” investment, Masanao wrote.

Japanese government bonds headed for their first two-month gain this year, returning 0.9 percent since the end of July, according to an index compiled by Merrill Lynch & Co. Investors sought the relative safety of government debt as consumer prices fell at a record pace, increasing the risk that deflation will slow Japan’s recovery from its deepest postwar recession.

The DPJ-led government, which came to power this month, may allow the yen to strengthen, Masanao wrote in the report.

“The DPJ’s foreign policy bias toward Asia and away from the U.S. and economic policy focused more on households than on large corporations should translate into medium- to long-term tolerance for yen appreciation,” the report said. That stance “seems likely to parallel other Asian countries’ increasing tolerance for their own currency appreciation.”…..

GE Revives Wind Energy In India

By Abhay Singh and Rakteem Katakey

Sept. 29 (Bloomberg) — General Electric Co., the biggest maker of power-generation equipment, is reviving its Indian wind-turbine business after a four-year absence because the government has improved incentives.

Fairfield, Connecticut-based GE said this month it will build wind turbines in south India with an annual capacity to produce 300 machines of 1.5 megawatts each. Customers have been lined up to buy some of these, Steve Bolze, president and chief executive of GE’s Power & Water business, said in an interview.

The Indian government has changed its subsidy program to favor wind-energy generation rather than investment in turbines, aiming to speed development of electricity from clean-energy.

“As you shift more to generation-based, customers have greater incentive to produce power or to expand the number of wind turbines on a given farm,” Bolze said last week in New Delhi.

In India, the earlier incentive system for investors in wind energy allowed them to claim 80 percent depreciation on equipment costs in the first year. That helped companies such as India’s Suzlon Energy Ltd. become the world’s fifth-largest maker of wind turbines.

GE is reentering the Indian market at a time when Suzlon has been buffeted by quality issues and slowing orders.

“We have some opportunities that we have already solidified with customers,” Bolze said, without being specific.

India Fifth

India is ranked fifth globally in wind energy with an installed capacity of 9,645 megawatts, according to the 2008 Global Wind Energy Council report. One megawatt is enough to power about 800 average U.S. homes. India estimates the country has the potential to produce 45,000 megawatts of wind power.

The wind turbine plant is scheduled to start production in the second half of 2010.

“There is a dramatic need for power in India, given the population growth and industry demand that is going on,” Bolze said. “Power demand in India is expected to double between now and 2017.”…..

European Confidence Rises To a 1 Year High

By Simone Meier

Sept. 29 (Bloomberg) — European confidence in the economic outlook increased to the highest in 12 months in September as the economy showed signs of rebounding from the worst recession in more than six decades.

An index of executive and consumer sentiment in the 16- nation euro region rose to 82.8, the highest since September 2008, from 80.8 in August, the European Commission in Brussels said today. That was the sixth straight monthly gain. Economists had projected an increase to 82.7, a Bloomberg survey showed.

European companies including Germany’s ThyssenKrupp AG and Paris-based L’Oreal SA have beaten analysts’ earnings estimates, suggesting government stimulus programs are feeding into the economy. Manufacturing and service industries expanded for a second month in September and German business confidence climbed to a 12-month high. Rising unemployment may prompt consumers to rein in spending, curbing the recovery…..

PNB Paribas Will Raise $6.3bln To Repay Government Bailout Funds

By Fabio Benedetti-Valentini and David Whitehouse

Sept. 29 (Bloomberg) — BNP Paribas SA, France’s largest bank, said it will raise 4.3 billion euros ($6.3 billion) in a rights offer to help repay government funds.

BNP Paribas is offering existing investors 107.6 million shares at 40 euros each, or 29 percent below yesterday’s closing price, the Paris-based bank said today. The company will repay 5.1 billion euros it received from the French state as well as 226 million euros of interest, it said.

BNP Paribas and Societe Generale SA, the country’s second- largest bank by market value, received a total 8.5 billion euros from the state to boost capital and sustain lending after Lehman Brothers Holdings Inc.’s failure shook markets last September. After paying back the government, BNP Paribas’s tier-one capital ratio, an indicator of financial strength, will be above 9 percent, the company said.

“This will put them in a stronger position and I certainly support this,” said Andy Lynch, who manages $1.8 billion at Schroders Investment Managers in London and holds BNP shares. “We are likely to see more of these moves throughout Europe.”……

Iceland Frets Over Waiting on IMF

By Omar R. Valdimarsson

Sept. 29 (Bloomberg) — Iceland can’t afford to wait any longer for its International Monetary Fund review and the transfer of the second tranche of its IMF-led bailout loan, Prime Minister Johanna Sigurdardottir said.

“The review of Iceland’s program has been delayed for way too long,” Sigurdardottir said in an interview in the township of Gardabaer in Iceland on Sept. 26.

The IMF is withholding the payments until a dispute with the U.K. and the Netherlands over depositor claims is resolved. Last year’s failure of Landsbanki Islands hf, which provided Internet accounts known as Icesave, left thousands of British and Dutch depositors in the dark about how to recoup their life savings and prompted the U.K. to deploy anti-terror laws to freeze Icelandic assets until the country agreed to cover the claims.

“We are still hoping that the program will be reviewed in October,” Sigurdardottir said. “However, it’s clear that the IMF wants to see a solution in the Icesave matter, prior to Iceland’s review with the fund.”

The coalition government on June 6 agreed to take a 2.35 billion-pound ($3.74 billion) loan from the U.K. and 1.2 billion euros ($1.76 billion) from the Netherlands to cover the deposit guarantees. That agreement was shelved after the Atlantic island’s lawmakers demanded changes, including linking debt payments to Iceland’s economic growth rate and a clause enabling renegotiation if the loan isn’t repaid by 2024.

‘More Elusive’….

Siemans Warns Orders Will Fall 20%

By Benedikt Kammel and Richard Weiss

Sept. 29 (Bloomberg) — Siemens AG had a “tough” year as orders for its factory equipment and lighting products fell, forcing Europe’s biggest engineering company to deepen job cuts and book charges, Chief Financial Officer Joe Kaeser said.

Order bookings in the fiscal fourth quarter that ends tomorrow will fall about 20 percent from a year earlier, and the Munich-based company is adjusting capacity to adapt, Kaeser told analysts and investors at a meeting in London today.

“The night is always darkest before dawn,” Kaeser said in a Web-cast presentation. The company held a “tight” grip on costs in 2009 and will continue to do so next year, he said.

Siemens, which makes light bulbs, medical scanners and drives that automate factory production, has cut its global workforce to 408,000 this year from more than 420,000 employees as clients in the energy, health-care and manufacturing industries cut spending. Siemens cut 5,000 jobs alone at its Osram lighting unit, Kaeser said today, and the company will book some charges for all reductions in its latest quarter.

Siemens fell as much as 2.02 euros, or 3 percent, to 63.94 euros in Frankfurt trading after Kaeser’s comments. The stock is almost unchanged in the last year, valuing Siemens at about 58.7 billion euros ($85.6 billion.)….

U.S. Drug Companies Chase Vaccine Makers

Amid rising concern about the threat of influenza pandemics, three big drug makers announced deals Monday that give them rights to new flu vaccines, placing bets on one of the pharmaceutical industry’s brightest, but riskiest, segments.

The deals reflect the growing conviction among pharmaceutical executives that vaccines against a variety of maladies, long an industry stepchild, will become an increasingly important source of growth to replace aging blockbusters that are poised to lose patent protection.

SAN FRANCISCO (Reuters) – Dell Inc on Monday unveiled its latest high-end, ultra-thin personal computer, bringing some fresh design appeal to its enterprise models.

Dell called the new Latitude Z the world’s thinnest and lightest 16-inch laptop, at 4.5 pounds and less than one inch thick.

However, the Latitude Z does not come cheap, starting at $1,999. Dell, the world’s No. 2 PC maker said it is targeting the PC at what it calls “impression makers,” such as creative professionals.

Thin and light is undoubtedly a priority for PC makers this fall, in both consumer and business segments. Technology advances are allowing PC makers to cram ever more performance into a shrinking form factor…..

Starbucks Steps Down To Instant

By Lisa Baertlein

LOS ANGELES (Reuters) – Chief Executive Howard Schultz called Starbucks Corp’s Via Ready Brew “perhaps the biggest opportunity” in company history as he prepared for the instant coffee product’s North American roll-out on Tuesday.

With Via, the coffee chain that introduced espresso drinks to the masses, hopes to steal a big slice of the $21 billion global instant coffee market from established players like Nestle SA’s Nescafe and Kraft Foods Inc’s Sanka.

“This is the biggest investment we’ve made in a national launch,” said Schultz, who is navigating a turnaround at Starbucks while looking for new products to drive profits.

Starbucks will trumpet Via’s debut in the United States and Canada with a week-long advertising campaign that will highlight in-store taste tests pitting Via against Starbucks brewed coffee……

Peter Thiel States The Recovery Is Fake

High profile hedge fund manager Peter Thiel is speaking out after reports emerged that his firm was floundering as the markets ripped higher.  Thiel, a master of understanding secular trends believes the rally is built on quicksand – a stance he not alone in taking.   Thiel told the WSJ yesterday that the rally was not real:

“The recovery is not real,” he says. “Deep structural problems haven’t been solved and it’s unclear how we will create jobs and get the economy growing again — that’s long been my thesis and it still is.”

Of course, this sounds all too familiar to regular readers.  Thiel is dead right about the long-term problems that the U.S. is confronted with.  Unfortunately for Mr. Thiel’s investors he has had a difficult time trading around these themes.  Thiel’s fund Clarium was up 50% as of the middle of last year, but finished the year with slight gains.  Even his deep pessimism couldn’t protect him from the collapse in Q3 as his commodity heavy fund got pummeled.  The fund is now sitting on a 40% peak to trough (?) draw-down – a massive and potentially life threatening draw-down for such a large and respected fund.


But Mr. Thiel has unwavering faith in his positions which include a re-emergence of the fear trade:

“The government has helped stabilize the banking system, but I’m not sure we have a path toward sustainable growth,” partly because consumers are dealing with debt and other issues, even as an energy crisis looms, he says. “It always feels unpatriotic to be negative. But too few people are focused on the real problems.”

As we often hear, the market can remain irrational longer than you can remain solvent.  Investors would be crazy to bet against Thiel in the long-run, but that doesn’t mean there isn’t more near-term pain for the ultra negative investors….

Source:  WSJ

* All information on this website is provided for general purposes and should not be misconstrued as financial advice. Always consult your financial advisor before acting on any of the information herein. You should always assume that the author(s) could have a vested interest in topics described and may or may not own securities and instruments discussed.

Workers in Melbourne at a CSL facility that produces flu vaccines. Merck will market CSL's seasonal flu vaccine in the U.S.

Workers in Melbourne at a CSL facility that produces flu vaccines. Merck will market CSL's seasonal flu vaccine in the U.S.

Vaccine sales are growing faster than sales of other prescription medicines and are largely immune to the generic competition that is already costing drug makers billions of dollars in revenues on their top-selling treatments.

Moreover, government agencies both in the U.S. and around the world are increasingly reliable buyers of vaccines as they seek to stockpile medicines that could help protect the public in case of a major flu outbreak.

“If you have a new vaccine for a new type of meningitis or swine flu, that clearly is a major public-health issue and, therefore, the willingness to pay is going to be greater,” said Murray Aitken, senior vice president of health-care insight at IMS Health.

In one of the deals, Johnson & Johnson paid €302 million ($441 million) for an 18% stake in Dutch biotech company Crucell NV, in order to jointly develop vaccines. In addition, Abbott Laboratories confirmed it will acquire a unit of Belgian conglomerate Solvay SA for €4.5 billion in a deal that includes a vaccine-making business. And Merck & Co. said it obtained from Australia’s CSL Ltd. for an undisclosed sum the U.S. marketing rights to a seasonal flu vaccine.

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Editorial: If Money Could Speak Would It Say Round 2 ?

Money Figures Spell Trouble Ahead

Private credit is contracting on both sides of the Atlantic. The M3 money data is flashing early warning signals of a deflation crisis next year in nearly half the world economy. Emergency schemes that have propped up spending are being withdrawn, gently or otherwise.

Unemployment benefits have masked social hardship unto now but these are starting to expire with cliff-edge effects.The jobless army in Spain will be reduced to €100 a week; in Estonia to €15.

Whoever wins today’s elections in Germany will face the reckoning so deftly dodged before. Kurzarbeit, that subsidises firms not to fire workers, is running out. The cash-for-clunkers scheme ended this month. It certainly “worked”.

Car sales were up 28pc in August, but only by stealing from the future. The Center for Automotive Research says sales will fall by a million next year: “It will be the largest downturn ever suffered by the German car industry.”

Fiat’s Sergio Marchionne warns of “disaster” for Italy unless Rome renews its car scrappage subsidies. Chrysler too will see some “harsh reality” following the expiry of America’s scheme this month. Some expect US car sales to slump 40pc in September.

Weaker US data is starting to trickle in. Shipments of capital goods fell by 1.9pc in August. New house sales are stuck near 430,000 – down 70pc from their peak – despite an $8,000 tax credit for first-time buyers. It expires in November.

We are moving into a phase when most OECD states must retrench to head off debt-compound traps.

Britain faces the broad sword; Spain has told ministries to slash 8pc of discretionary spending; the IMF says Japan risks a funding crisis.

If you look at the sheer scale of global stimulus this year, what shocks is how little has been achieved. China’s exports were down 23pc in August; Japan’s were down 36pc; industrial production has dropped by 23pc in Japan, 18pc in Italy, 17pc in Germany, 13pc in France and Russia and 11pc in the US.

Call this a “V-shaped” recovery if you want. Markets are pricing in economic growth that is not occurring.

The overwhelming fact is that private spending has slumped in the deficit countries of the Anglosphere, Club Med, and East Europe but has not risen enough in the surplus countries (East Asia and Germany) to compensate. Excess capacity remains near post-war highs across the world.

Yet hawks are already stamping feet at key central banks.

Are they about to repeat the errors made in early 2007, and then again in the summer of 2008, when they tightened – or made hawkish noises – even as the underlying credit system fell apart?

Fed chairman Ben Bernanke spoke in April 2008 of “a return to growth in the second half of this year”, and again in July 2008 that growth would “pick up gradually over the next two years”.

He could only have thought such a thing if he was ignoring the money data. Key aggregates had been in free-fall for months.

I cited monetarists in July 2008 warning that the lifeblood of the Western credit was “draining away”. For whatever reason (the lockhold of New Keynesian ideology?) the Fed missed the signal.

So did the European Central Bank when it raised rates weeks before the Lehman collapse, blathering about a “1970s inflation spiral.”

Yes, the money entrails can mislead. The gurus squabble like Trotskyists. But you ignore the data at your peril.

Tim Congdon from International Monetary Research says that US bank loans have been falling at an annual pace of almost 14pc since early Summer: “There has been nothing like this in the USA since the 1930s.”

M3 money has been falling at a 5pc rate; M2 fell by 12pc in August; the Commercial Paper market has shrunk from $1.6 trillion to $1.2 trillion since late May; the Monetary Multiplier at the St Louis Fed is below zero (0.925). In Europe, M3 money has been contracting at a 1pc rate since April.

Private loans have fallen by €111bn since January. Whether you see a credit crunch in Euroland depends where you sit. It is already garrotting Spain. Germany’s Mittelstand says it is “a reality”, even if not for big companies that issue bonds. The Economy Ministry is drawing up plans for €250bn in state credit, knowing firms will be unable to roll over debts.

Bundesbank chief Axel Weber sees no crunch now, yet fears a second pulse of the crisis this winter. “We are threatened by stress from our domestic credit industry through the rise in the insolvency of firms and households,” he says.

Draw your own conclusion. Western central banks will have to “monetize” deficits on a huge scale to stave off debt deflation. The longer they think otherwise, the worse it will be.

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Dallas Manufacturing Index: Prior -9.1% / Mkt Expects -4.1% / Actual -.5%

 Sept 28 (Reuters) - Details of the Federal Reserve Bank of
Dallas' Texas monthly manufacturing index released on Monday.
 Following are details from the survey:
                                          Expected 6
                              Sept    Aug  months
                             Index  Index  Index
General Business Activity        -6.4   -9.1   13.9*
Production                       -0.5   -9.7   33.0
Capacity utilization             -4.8  -13.3   30.7
Volume of new orders              8.0   -1.7   37.2*
Growth rate of orders            -4.8   -6.0   23.8
Unfilled orders                  -3.9  -10.0   12.8*
Volume of shipments               0.3  -11.2   34.5
Delivery time*                   -8.4   -7.2    4.3
Materials inventories*          -25.6  -29.6   -1.1
Finished goods inventories*     -21.3  -23.2   -5.4
Prices paid for raw materials     9.8    9.9   32.2*
Prices received   
for finished goods              -17.9  -21.4    2.1*
Wages and benefits               *0.0   *0.0   14.5
Number of employees              -8.1  -15.7   10.6*
Average employee workweek*       -7.4  -11.2   19.1
Capital expenditures*           -12.8  -15.3   -1.1
                                          Expected 6
                              Sept    Aug  months
                             Index  Index  Index
How has the                      -2.7   -6.7   16.9
outlook for your
company changed?
 Beginning with the August 2009 report, the Dallas Fed said
it had sufficient data to report some components on a
seasonally adjusted basis.
 Items or components still reported on an unadjusted basis
are indicated with an asterisk (*).
 The index measures Texas' factory activity. Readings above
zero indicate expansion and negative levels contraction. The
survey began in 2004.


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