James Dicks Daily Digest - January 5, 2009

President-elect Obama is heading to Capitol Hill to push for quick action on a broad economic stimulus package that congressional leaders are saying won't be ready until mid-February at the earliest -- almost a month later than he wanted. Obama met with House and Senate Democratic leaders and with a bipartisan group of key lawmakers. He hopes to have Congress enact the recovery plan in time for him to sign his when he takes office Jan. 20th.

The Federal Reserve Bank of New York announced it has begun purchasing fixed-rate mortgage-backed securities guaranteed by Fannie Mae (FNM), Freddie Mac (FRE) and Ginnie Mae. The purchases follow up on an announcement made in November that the Fed will buy up to $500 million in mortgage-backed debt from the major government-sponsored agencies to support the housing market.

The Commerce Department reported that outlays for construction projects in the United States fell by a seasonally adjusted annual rate of 0.6% in November after an upwardly revised drop of 0.4% in October. Spending on residential projects fell 4.1%, while spending on private-sector nonresidential construction rose 0.7%. Total outlays are down 3.3% in the past year.

It was another tough month for the auto industry. Ford's (F) sales for the full year dropped 21 percent, making it likely that the company will trail Toyota Motor Corp. (TM) and remain the number three U.S. auto seller for the second straight year. Subaru’s December sales fell 7.7 percent from December 2007. Audi of America, a unit of Volkswagen said U.S. December sales fell 9.3% from a year ago.

Amazon (AMZN) was upgraded by J.P. Morgan to overweight from neutral, saying that while a tough consumer environment may hamper near-term spending, it believes Amazon will continue to take share within a growing e-commerce sector in the longer term. The broker also told clients that the company is diversifying its business by adding new product lines and continues to expand its geographic footprint.

Bank of America Corp. (BAC) was upgraded by Fox-Pitt to outperform from in-line, citing the acquisition of Merrill Lynch, management's early recognition of credit losses, and valuation.

The New York Times Co. (NYT) said it's offering up the front page of its flagship paper to advertisers, beginning Monday with CBS. The paper has a weekday readership of 2.8 million and a Sunday readership of 4.2 million. The Group's International Herald Tribune is also offering front-page advertising.

MasterCard Inc (MA) bought Orbiscom Ltd., a provider of payment software for financial institutions. The company is based in Dublin, Ireland. The acquisition price is about $100 million, some of which depends on future performance of Orbiscom's business.

Pfizer Inc (PFE) the world's biggest pharmaceutical group is open to acquisitions. The company’s chief executive Jeff Kindler said, "The real goal is to grow revenues. We are open to opportunities and constantly looking at those which are big, small and in-between.” Sales of Lipitor, which is Pfizer's $12 billion-a-year cholesterol fighter, are set to fall in 2011 when generic versions are scheduled to hit the market.

Horizon Lines Inc. (HRZ) said it will "vigorously defend" itself against a securities class-action lawsuit related to alleged price-fixing at its Puerto Rican shipping operations. The ocean shipping company said that the lawsuit, brought by individuals that have owned its stock between March 2, 2007 and April 25, 2008, claims it made "material misstatements and omissions" about the business' pricing practices.

Scheduled U.S. Economic Reports (Tuesday)

ISM Services Index (Dec), Factory Orders (Nov)

In Earnings News

Progress Energy Inc. (PGN) announced it expects 2008 earnings to reach the low end of previous estimates due to mild weather and the slowing economy. The utility said its 2008 profit will likely hit the lower end of its earlier estimated range of $2.95 to $3.05 per share. Analysts surveyed forecast a profit of $3.01 per share, on average.

Mosaic Co. (MOS), a fertilizer and feed company, is projected to report second-quarter earnings of $1.41 a share.

Navistar International (NAV) anticipates 2009 earnings in the range of $5.10 to $5.60 a share. Analysts expected $6.45 a share. Navistar said its forecast is based on current market conditions.

Synovus Financial Corp (SNV) corrected its estimated fourth-quarter provision for possible loan losses, setting the figure at $350 million, with a charge-off proportion of 3.2%. The financial-services-holding company, which has more than $34 billion in assets, said earlier that the provision would total about $250 million with a charge-off proportion of 2.2%.

Scheduled Earnings Reports (Tuesday)

Acuity Brands, Vitesse Semiconductor, Finish Line, Standard Microsystems. On Monday, January 12th, Alcoa (AA) will begin the fourth quarter earnings season when they announce their quarterly numbers.

Stocks in the News

Apple’s (AAPL) 2009 MacWorld Expo kicked off in San Francisco. It will be the last MacWorld in which Apple will participate. And Apple founder Steve Jobs announced he's suffering from a "hormone imbalance" that's caused him to steadily lose weight.

Continental Airlines (CAL) and American Airlines parent AMR (AMR) sued the Federal Aviation Administration over new safety measures meant to ensure against pilot fatigue on certain international flights.

Monaco Coach (MNC) retained Imperial Capital to evaluate strategic alternatives including a possible joint venture or merger.

Rite Aid Corp. (RAD) that its December same-store sales dropped 0.2%.Front-end same-store sales declined 2.4%, while pharmacy same-store sales rose 1.2%.

E-Trade Financial (ETFC) reported that two of its units, E-Trade Securities LLC and E-Trade Clearing LLC, were fined a combined $1 million for failing to establish and implement anti-money-laundering policies and procedures.

Chesapeake Energy (CHK) sold volume from various assets for $412 million, conveying a royalty interest to investors associated with Argonaut Private Equity.