JDfn Daily Digest - November 10, 2008

The government provided new financial assistance to troubled insurance giant American International Group (AIG), including pouring $40 billion into the company in return for partial ownership. The action was taken as it became increasingly clear that an original financial lifeline given to AIG in September would not be enough to stabilize the company. Meantime, AIG said it lost $24.47 billion or $9.05 per share in the most recent quarter.

General Motors (GM) was downgraded to sell from hold and labeled as likely to be worthless by Deutsche Bank. A report by the Center for Automotive Research last week estimated that 3 million jobs could be lost if all three major Detroit manufacturers were to halt U.S. production.

The monthly survey of economists published by Blue Chip Economic Indicators said the U.S. economy is expected to shrink 0.4% in 2009 compared with 2008. The economists also expect contractions in the Japanese, British and euro-zone economies in 2009.

The Chinese Government announced that its massive stimulus package is meant to help support global growth by boosting Chinese investment and consumer spending. Asian stock markets soared after the announcement of the 4 trillion Yuan, or $586 billion, package as Beijing joined efforts by governments around the world to reduce the global economic slowdown.

The French Finance Minister reiterated her nation's position that big emerging nation economies, like those in Brazil and India, should be allowed to join the Group of Seven industrialized nations forum that has a large say in global economic policy.

According the latest nationwide Lundberg survey, the average retail price for a gallon of gasoline in the United States fell more than 48 cents per gallon in the past two weeks to $2.30. Though it is a smaller price drop than the prior two-week period it is still the second-greatest price crash in the history of the U.S. gasoline market.

Circuit City Stores Inc. (CC) filed for bankruptcy protection but plans to stay open for business as the busy holiday shopping season approaches. It filed under Chapter 11, which will allow it to hold off creditors and continue operations while it develops a reorganization plan.

Deutsche Post AG will close all of its DHL Express service centers, cut 9,500 jobs in the United States and eliminate U.S.-only domestic shipping by land and air, citing heavy losses and fierce competition. The cuts are part of a wider plan to curtail operations in the U.S.

Beazer Homes USA Inc. (BZH) said its home closings declined 38 percent during the fiscal fourth quarter, while new home orders increased. Beazer released the home data ahead of its plans to release fiscal fourth-quarter and full-year financial results Dec 2nd.

NRG Energy Inc. (NRG) rejected an unsolicited $6.1 billion all-stock bid from nuclear power giant and utility operator Exelon Corp. (EXC), calling the offer, which would create the nation's largest power company, too low.

Scheduled U.S. Economic Reports (Tuesday)

None Scheduled

In Earnings News

Fannie Mae (FNM) reported a loss of $13 per share for the July-September quarter, mainly due to a $21.4 billion non-cash charge to reduce the value of a tax asset. Analysts expected a loss of $1.60 per share.

Tyson Foods (TSN) earned $48 million, or 13 cents per share, in the most recent quarter, compared with $32 million, or 9 cents per share, a year earlier. Analysts expected a profit of 18 cents per share.

Nortel Networks (NT) posted a net loss of $3.41 billion, or $6.85 per share, down from a profit of $27 million, or 5 cents per share, in the same period a year earlier. Analysts polled expected, on average, a loss of 30 cents per share.

McDonald's Corp. (MCD) announced its worldwide same-store sales rose 8.2 percent in October, helped by demand from overseas customers. The chain said total sales rose 5.4 percent during the month, as consumers sought value in the chain's more inexpensive menu items.

Dish Network (DISH) earned $92 million, or 20 cents per basic share, in the quarter. That's down from $200 million, or 45 cents per basic share, last year. Analysts expected a profit of 58 cents per share.

Scheduled Earnings Reports (Tuesday)

Fossil, Bob Evans Farms, Liz Claiborne, Home Inns and Hotels, GNC Corp, Lenox Group, Napster, Qualstar Corp, Pinnacle Data Systems

Stocks in the News

Coca Cola Enterprises (CCE) was upgraded to overweight from neutral at J.P. Morgan following the stock's sharp year-to-date decline.

AstraZeneca (AZN) traded higher after new data show that Crestor 20 mg significantly reduced major cardiovascular events by 44%.

Centennial Communications Corp (CYCL) traded higher after AT&T ann0unced it will buy the provider of wireless and broadband service for $8.50 a share, or $944 million, cash.

Dillard’s Department Stores (DDS) had its ratings lowered by Standard & Poor's because of weak consumer spending.

Cellcom Israel Ltd (CEL) reported third-quarter net income fell 12%, and adjusted earnings rose 20%, on 5% higher revenue.

Isis Pharmaceuticals (ISIS) reported a third-quarter net income applicable to common stock totaled $3.2 million, or 3 cents a share.

Whole Foods Markets Inc (WFMI) had its corporate credit rating lowered to BB- from BB by Standard & Poor's.

Genworth Financial Inc (GNW) had its long-term counterparty credit rating lowered to A- from A by Standard & Poor's.

SunPower Corp (SPWRA) signed a contract to provide Italian solar-plant integrator Ecoware SpA with at least 130 megawatts of solar panels over four years.