2009-Dec-31 - WaMu says tax refund may double, shares soar

WILMINGTON, Delaware (Reuters) – Washington Mutual Inc said it could receive an additional $2.6 billion in tax refunds due to a recently enacted law, sending shares of the bankrupt bank holding company soaring on Thursday.

The added money could also help resolve various legal disputes surrounding the company's collapse last year, one analyst said.

Washington Mutual could receive the additional refund following the enactment in November of a law that permits net operating losses to be carried back for five years, from two years previously. That change would double the company's expected refund, according to a court filing on Wednesday.

The company's preferred shares (WAMPQ.PK) rocketed nearly 50 percent to $59.48 while its common stock (WAMUQ.PK) rose about 11 percent to 13.71 cents, in pink sheet trading.

One analyst said the refund could clear the way for a settlement of the bankruptcy case, which has been bogged down in disputes over claims to company's assets.

"It could be one of the main mechanisms of fostering a settlement. The apportionment of the refund could make all the sides happy," said Kevin Starke, senior vice president at CRT Capital Group in Stamford, Connecticut.

The company's main asset is a deposit of about $4 billion that is also claimed by JPMorgan Chase & Co Inc (JPM payday advances.N), which bought Washington Mutual's failed bank operations from a government agency for $1.9 billion last year.

JPMorgan also has said it has a claim on some of Washington Mutual's tax refunds, which until the law change were estimated at up to $3 billion. The refunds and deposit are the company's largest assets.

Earlier this month, an office within the U.S. Trustee asked Washington Mutual to provide a list of its shareholders so it could survey them for their interest in serving on an official committee representing equity holders.

Shareholders are generally the last creditors to receive a distribution and such a committee is usually opposed by the U.S. Trustee unless shareholders can prove they can reasonably expect a distribution after all creditors have been paid.

Washington Mutual said in its operating report for November it had $8.3 billion of liabilities.

Washington Mutual and the U.S. Trustee's office could not be immediately reached for comment.

The case is In re Washington Mutual Inc, U.S. Bankruptcy Court, District of Delaware (Wilmington), No. 08-12229.

(Reporting by Tom Hals; Editing by Tim Dobbyn)

WaMu says tax refund may double, shares soar

2009-Dec-30 - Nokias latest patent stike on Apple a risk, but may pay off

HELSINKI (Reuters) – Nokia's latest patent strike against Apple underscores the changing dynamics of the cell phone market, with the sector leader no longer holding the whip hand over rivals in terms of product development.

But analysts believe the risks involved in stepping into a legal minefield to help make up lost ground, notably in the fast-growing smartphone market, could pay dividends given the huge stock of patents Nokia has built up as a founding father of the handset industry.

Nokia raised the heat on Tuesday with a new patent challenge against the iPhone maker, and the chance of a tit-for-tat response from Apple as the two companies seek an advantage ahead of possible settlement talks appears high.

"To some degree it is a desperate move, but Nokia has been in the mobile handset business from the very beginning and has many more patents than Apple, so it's likely that Apple to some extent at least has used some of Nokia's patents, and maybe some others' too," said analyst Greger Johansson at Redeye.

In its complaint filed with the U.S. International Trade Commission, Nokia alleged Apple infringes its patents in "virtually all of its mobile phones, portable music players, and computers" sold.

Nokia expects the ITC, which investigates trade matters including intellectual property infringement, to decide whether to pursue the case in around 30 days.

MARKET SHARE

The aggressive move comes as Nokia, which has stumbled badly in the fast-growing smartphone sector, tries to win back market share from the likes of Apple and Blackberry maker Research in Motion.

"It's probably (happening) because Nokia has had a tough time in the last 1-2 years ... if Nokia had been making great progress in the smartphone market I don't think (the patents) would be a big issue," Johansson said.

Relative newcomer Apple trails Nokia in cell phone shipments, but has gained a lot of ground against the market leader in the smartphone segment thanks to the iPhone.

Apple, which entered the industry in mid-2007, overtook Nokia last quarter as the cell phone maker generating the highest total operating profit online payday advance.

Both firms earlier this year launched patent infringement suits against the other.

Analysts say the dispute, potentially involving hundreds of millions of dollars in annual royalties, reflects the shifting balance of power in the mobile industry as cell phones morph into handheld computers that can play video games and surf the Web.

POSTURING

The ITC move by Nokia added a new wrinkle to an ongoing dispute that some analysts believe could take years to settle.

"This is all part of the posturing as they move toward getting a resolution to this further down the road," said Ben Wood, director of research at CCS Insight.

Analyst Hannu Rauhala at Pohjola Bank added: "This is like arm wrestling and Nokia is trying to strengthen its position in negotiations with Apple."

For Nokia, the battle against Apple represents its third major legal battle following past tussles with Motorola and Qualcomm.

"Nokia is well-versed in the tactics it can use in these kind of disputes having had so much experience with Qualcomm ... this is just another avenue that Nokia is exploring," CCS Insight's Wood said.

"I do believe that Nokia wants a quick closure on this, because the Qualcomm litigation in particular was a significant drag for both parties ... it was a complete distraction from the core business," he said.

Apple declined to comment on Nokia's ITC move, referring only to its patent countersuit earlier this month, but analysts said a robust response was likely.

"Probably Apple will respond with some counter claim and it will go back and forth," Redeye's Johansson said.

(Additional reporting by Terhi Kinnunen in Helsinki and Gabriel Madway in San Francisco; editing by John Stonestreet)

Nokia's latest patent stike on Apple a risk, but may pay off

2009-Dec-28 - Idaho AG: Cheated homeowners get $19K settlement

BOISE, Idaho – Attorney General Lawrence Wasden says Idaho homeowners who were duped into paying a New Jersey company to help them modify their mortgages will get more than $19,000 in a settlement.

Wasden says the investigation into Weston, New Jersey-based Best Interest Rate Mortgage Co. LLC began with a complaint about a direct-mail advertisement.

The ad offered a special loan modification programs as part of the "Economic Stimulus Act of 2008" and appeared to have come from the U cash til payday loan.S. government.

The attorney general's office says the company charged Idaho homeowners upfront fees ranging from $1,000 to $1,800 before the mortgage modifications were completed, which Idaho law prohibits.

The company, which has denied wrongdoing, was ordered to pay the 12 homeowners $19,710.

Idaho AG: Cheated homeowners get $19K settlement

2009-Dec-27 - China urged to keep policies flexible

BEIJING (Reuters) – China needs to keep its economic policies flexible to fight against excessive surges in asset prices and hot money inflows, a central bank adviser said over the weekend.

China must watch closely for liquidity-driven asset price rises, though high inflation is unlikely next year, Fan Gang, academic member of the People's Bank of China's monetary policy committee, told a financial forum.

Beijing also needs to guard against sudden capital inflows from investors seeking higher returns should developed economies, including the United States, not recover well and keep interest rates low, he added.

"Macro economic policies are short-term policies and need to change when conditions change," Fan told a forum.

"Situations will shift very swiftly, including asset prices and hot money inflows. My personal view is that a flexible macro policy is an important factor in keeping economic stability," he said fast cash without a hassle.

Beijing has repeatedly pledged that it will stick to its fiscal stimulus and appropriately loose monetary stance, but it has also said that it will enhance the flexibility of its policies next year, which many analysts see as a signal of its intention to begin mild tightening.

It has already started reining in its ultra-loose policies, including saying that it will more strictly control bank lending.

Fan said the Chinese economy would grow 8-9 percent in 2010, peaking at roughly 11 percent year-on-year growth in the first quarter.

(Reporting by Langi Chiang and Simon Rabinovitch; Editing by Valerie Lee)

China urged to keep policies flexible

2009-Dec-26 - Sparse shelves greet post-Christmas deal hunters

Shoppers headed to America's malls Saturday, many with gift cards in hand, hoping to snag after-Christmas discounts. They were greeted with big markdowns — in some cases topping 75 percent off — but often found limited selection.

"Everything's been picked over," said Donna Brown, a 52-year-old hairdresser from Seaford, Del., as she sorted through what was left of the fleece pajamas marked down 60 percent to $11.99 at a J.C. Penney store in Salisbury, Md.

Crowds were mixed during the kickoff of the week after Christmas, which last year accounted for nearly 15 percent of holiday retail sales.

This year, it could be more important because snowstorms that socked much of the country cut sales by 2.1 percent for the weekend before Christmas compared with the same weekend a year earlier, according to research firm ShopperTrak.

Retailers are counting on the days after Christmas to perk up overall holiday sales in a season that looks like it's been only modestly better than last year's disaster.

This year the calendar provides a full weekend just after Christmas for merchants to try to entice shoppers to ring up more sales before many close out the year.

"Nothing was amazingly stellar," NPD Group analyst Marshal Cohen said of the holiday season so far. "This is not going to go down as a Christmas for most people to really remember."

This Saturday, stores made a push to woo gift-card-toting shoppers Saturday by opening early, slashing prices and advertising big sales. "Wasn't under the tree? Get it now at the Apple Store," read one ad from Apple Inc.

Knowing holiday shoppers would likely spend less this year because of high unemployment, a move toward thrift and economic uncertainty, merchants carefully managed inventory for the season, buying less than a year ago when the economic meltdown surprised everyone and forced fire sales to get rid of excess goods.

That meant by Saturday, some store shelves were practically empty.

"There isn't a tremendous amount to buy," Lisa Walters, a consultant with Retail Eye Partners, said as she studied shoppers at a mall in upstate New York.

Sheena Bird bought a flannel coat for $40 — 40 percent off — at Atlanta's Lenox Square Mall. But the waitress said she had no plans for a daylong shopping spree.

"There were a lot of good deals," she said. "But I was selective today, because I just got a bunch of gifts."

Many shoppers hunted for clearance Christmas items like ornaments, decorations and glassware payday loans for bad credit.

Kristie Dobbins, 31, stopped at the Wal-Mart store in Roeland Park, Kan. to buy holiday linens for next year. Along the way, she got a a dog bed for her Alaskan malamute.

"Everything we bought was half off," she said. "So it was worth the wait, and we will be ready for next year."

But others simply couldn't find what they were looking for or left empty-handed, hoping for better deals.

"I was trying to find a dress coat for my husband, but didn't find anything," said Bernaden Demesyeux after more than an hour of shopping at Livingston Mall in Livingston, N.J. "Everything is the same prices as before."

Weather also could complicate things, as a strong snow storm swept across parts of the nation's midsection and rain dampened the mid-Atlantic through New England, threatening to cause flooding. That kept some stores empty earlier in the day.

Walmart was offering half-off toys, and Toys R Us touted buy one, get one half-off offers. At Sears, customers could find coats for 70 percent off. And Gap Inc.'s Old Navy brand was selling men's and women's jeans for $15, and an e-mail encouraged shoppers to "redeem your gift cards today."

Gift card sales are not recorded as merchants' revenues until shoppers redeem them.

But gift card use appeared lighter at some locations Saturday, a potentially troubling sign because gift card redeemers often spend more than the value of the card and often buy goods that aren't on sale.

And returns seemed mixed, too, said Dan Jasper, a spokesman for the Mall of America in Bloomington, Minn. who said a combination of less selection in stores and tighter budgets led to the change.

"People didn't buy a lot of extraneous stuff," he said.

Still, the full assessment of this year's shopping season won't be known until merchants report December sales Jan. 7. Most expect fourth-quarter profits to be better than last year, because stores weren't forced to dramatically slash prices to liquidate unwanted merchandise.

Most who predict holiday sales have stuck with projections for sales slightly above or slightly below last year's.

____

AP Retail Writers Mae Anderson in Atlanta, Michelle Chapman in Livingston, N.J. and Anne D'Innocenzio in New York contributed to this report. Associated Press Writer Heather Hollingsworth contributed from Roeland Park, Kan. Heher reported from Salisbury, Md.

Sparse shelves greet post-Christmas deal hunters

2009-Dec-25 - Japan drafts record budget as PM battles scandal

TOKYO (Reuters) – Japan approved on Friday a record budget for next year that will inflate the country's already huge debt by $484 billion, as the prime minister vowed to battle on in the face of a growing scandal and sliding poll ratings.

With tax revenues sliding since the financial crisis erupted, the government has ditched a key campaign pledge to voters and tapped cash reserves to limit new borrowing at 44.3 trillion yen, a level already worrying bond markets as public debt nears 200 percent of GDP.

Prime Minister Yukio Hatoyama faces an upper house election next year so some analysts say his coalition may yet be tempted to spend more to prop up the economy, which has only recently emerged from Japan's worst recession since World War Two.

Hatoyama, whose Democratic Party ousted its long-dominant conservative rival in August, repeated his determination to stay on the job despite Thursday's indictment of two former close aides over false political funding records.

"I would like to brace myself, correct what needs to be corrected, and do my best," Hatoyama told reporters on Friday, the 101st day of his administration.

"The Japanese people may still think it is hardly possible for me to have not known (about the incident) but I told everything honestly, and I hope they will understand as much as possible."

Japanese media, however, said Hatoyama -- Japan's fourth prime minister in three years -- might have to quit if voters find his explanations and his leadership weak.

The Democrats took power pledging to put policy-making in the hands of politicians rather than bureaucrats, eradicate wasteful spending, and focus spending on consumers instead of the more business-focused policies of the ousted Liberal Democratic Party.

VOTERS' HOPES

But polls show voter support for the government sliding below 50 percent from initial highs over 70 percent, as doubts have grown about Hatoyama's ability to make tough decisions on the economy and diplomacy.

As well, concern simmers that political mastermind Ichiro Ozawa, a former leader and now the Democrats' No. 2 executive, is running the show.

Caught between campaign pledges to give more cash to consumers to boost growth and the reality of plunging tax revenues, Hatoyama has jettisoned a key pledge to cut petrol taxes bad credit payday loans.

Hatoyama has said he would keep another promise to pay child allowances to households regardless of income levels.

"Although cuts in public works spending are planned, they are likely to be more than offset by child allowances. Overall, the budget will likely give a slight positive effect on the economy," said Yuichi Kodama, an economist at Meiji Yasuda Life Insurance.

"Rather than keeping campaign pledges, it was more important for the government to reduce its spending as Japan's fiscal conditions are reaching limits."

Finding funds to pay for costly spending programs is expected to become more difficult, since tapping cash from special reserves is only a short-term solution.

Finance officials said about 10.6 trillion yen in such reserves would be used to balance next year's 92.3 trillion yen budget.

The government forecasts economic growth of 1.4 percent in 2010/11, which would be the first increase in three years, but analysts say policymakers need a plan to achieve sustainable growth.

Media polls before the indictment of Hatoyama's aides showed most voters felt that Hatoyama need not resign over the affair, which included the receipt of large amounts of money from his mother, daughter of the founder of tire maker Bridgestone Corp

But sagging ratings would undermine the Democrats' chances of winning an upper house election in mid-2010, leaving them dependent on two tiny coalition partners whose conflicting views make policy-making messy. A loss could create a policy deadlock, since the upper chamber can delay bills.

Hatoyama has long been a critic of political corruption and has said in the past that lawmakers should quit if aides were guilty of misdeeds.

On Thursday, he left the door open to changing his mind and resigning but said that, for now, he believed quitting would betray voters' hopes.

"Precisely so," said the Nikkei daily in a commentary.

"The question is whether he can demonstrate leadership to carry out policies. What voters have given the prime minister is a moratorium."

(Additional reporting by Yoko Nishikawa, Rie Ishiguro and Hideyuki Sano; Writing by Linda Sieg; Editing by Rodney Joyce)

Japan drafts record budget as PM battles scandal

2009-Dec-23 - Consumer sentiment improves in December

NEW YORK (Reuters) – Consumer sentiment improved in December from November on some income growth and less gloomy job conditions, a survey showed on Wednesday.

The Reuters/University of Michigan Surveys of Consumers said the final December reading on the index of consumer sentiment was 72.5, the highest since September. It was up from 67.4 in November and 60.1 a year ago.

But the latest figure fell short of analysts' median expectation of 73.5, according to a Reuters poll. It was also below the preliminary December figure of 73.4.

The gauge on current economic conditions rose to 78.0 from 68.8 in November but this was below an expected 79.1.

The barometer on consumer expectations climbed to 68.9 from 66.5 in November but was below a forecast 69 one hour payday loan.7.

"Consumers' evaluations of their personal finances improved slightly in December, but the gains still left their overall assessments at quite negative levels," Richard Curtin, director of the Reuters/University of Michigan Surveys of Consumers said in a statement.

Within the survey, the 1-year inflation expectation gauge eased to 2.5 percent from 2.7 percent in late November, while the barometer on inflation over the next five to 10 years slipped to 2.7 percent from 3.0 late last month.

(Reporting by Richard Leong, Editing by Chizu Nomiyama)

Consumer sentiment improves in December

2009-Dec-22 - Wall Street buoyed by optimism after home sales jump

NEW YORK (Reuters) – Stocks rose on Tuesday, briefly lifting the S&P 500 to a 14-month high, as a surge in existing home sales indicated more stabilization in housing, increasing optimism about the economic recovery and prospects for profits.

Stocks supporting the market's advance included big manufacturers like Boeing Co (BA.N), up 1.5 percent at $55.09 after it bought a stake in a U.S. plant that assembles the fuselage for its 787 Dreamliner.

Technology bellwethers also underpinned the market, with International Business Machines Corp (IBM.N) up 1 percent at $129.89 after the blue-chip company scored a 10-year outsourcing deal valued at $83 million.

The Dow Jones U.S. home construction index (.DJUSHB) jumped 4 percent following a report that showed U.S. existing home sales rose 7.4 percent in November to an annual rate of 6.54 million units, which was the fastest pace since February 2007. The November reading was much stronger than expected.

Investors "are warming up to the fact that the economic expansion is here, and is likely to expand sufficiently to suit corporate profits in 2010," said Bruce Zaro, chief technical strategist at Delta Global Advisors in Boston.

Any sign of stabilization in housing lends a big boost to investor sentiment as it was the fallout from that sector's downturn that recently drove the economy into its worst recession since the 1930s and propelled the U.S. unemployment rate above 10 percent to a 26-year high.

The Dow Jones industrial average (.DJI) gained 48.37 points, or 0.46 percent, to 10,462 instant payday loans.51. The Standard & Poor's 500 Index (.SPX)advance 4.15 points, or 0.37 percent, to 1,118.20. The Nasdaq Composite Index (.IXIC) rose 13.51 points, or 0.60 percent, to 2,251.17.

Earlier in the session, the S&P 500 (.SPX) hit a technical milestone, surging to an intraday high of 1,120.27 -- its highest in 14 months.

Market technicians have said a breakout in the S&P 500 above the 1,120 level would signal more gains for the broader market and could help the S&P 500 take aim at the 1,200 level.

The S&P 500 has risen 65 percent since hitting a 12-year closing low on March 9 and is up 23.9 percent for the year.

Year-end window dressing -- where portfolio managers sell laggards and buy shares that have rallied recently -- also boosted stocks.

Apple Inc (AAPL.O), which has surged 134.2 percent this year, was up 0.9 percent at $200.07, not far below its 52-week high set on October 21.

The CBOE Volatility Index (.VIX) or VIX, Wall Street's favorite barometer of investor fear, fell below a key psychological level of 20 to its lowest level since August 2008. In afternoon trading, the Vix was down 4.4 percent at $19.58.

A separate economic report that gave the final estimate of gross domestic product showed that GDP grew at an annual rate of 2.2 percent in the third quarter -- below the forecast for a gain of 2.8 percent.

(Reporting by Leah Schnurr; Editing by Jan Paschal)

Wall Street buoyed by optimism after home sales jump

2009-Dec-21 - Walgreen shares rise on 20% earnings jump

NEW YORK (MarketWatch) - Walgreen, one of the country's leading drugstore chains, on Monday reported a 20% jump in quarterly profit thanks to strong growth in its prescriptions business.

Walgreen first-quarter net income rose to $489 million, or 49 cents a share, from $408 million, or 41 cents a share in the year-ago period.

Excluding a restructuring charge of 3 cents a share, the Deerfield, Ill. retailer earned 52 cents a share and revenue rose to $16.36 billion from $14.95 billion.

Analysts expected Walgreen to earn 48 cents a share, with revenue of $16.24 billion, according to a survey by FactSet Research.

The company's number of prescriptions filled increased 12% over last year's first quarter. Walgreen exceeded by 5.5% the industry-wide prescription growth rate, excluding Walgreens, during the same period as reported by IMS Health low cost payday loans.

An early flu season and a well-executed flu shot campaign that launched Sept. 1, a month earlier than last year, lifted front-end and pharmacy sales in September and October, the company said.

Looking ahead, Walgreen said it remains "confident we can continue to generate strong cash flow, which provides us the financial strength and flexibility to continue investments in our core strategies while returning cash to shareholders."

Shares of Walgreen rose 3.5% to $37.93 in pre-market trades.

Walgreen shares rise on 20% earnings jump

2009-Dec-20 - Wall St gains in choppy trade; tech lifts Nasdaq

NEW YORK (Reuters) – Stocks rose on Friday in choppy trade as quarterly results from Oracle and Research In Motion lifted the Nasdaq more than 1 percent, but the U.S. dollar's climb curbed gains in both the Dow and the S&P 500.

The Nasdaq was led higher by Oracle Corp (ORCL.O) shares, which jumped 6.4 percent to $24.34, and the U.S.-listed stock of Research In Motion Inc (RIMM.O)(RIM.TO), which surged 10.3 percent to $69.99.

Despite the lift from these earnings-related stories, the robust dollar sapped much of the broader market's strength.

The U.S. dollar index (.DXY) climbed as much as 0.6 percent, but pared gains late in the session, easing some of the selling pressure on stocks. For the day, the U.S. dollar index ended just marginally higher -- up 0.03 percent.

Shares of multinational companies suffered from the greenback's rise. Heavy equipment maker Caterpillar Inc (CAT.N) fell 0.6 percent to $57.19, while plane maker Boeing Co (BA.N) was the biggest drag on the Dow, off 1.9 percent at $53.44.

Geopolitical concerns supported the flight to the U.S. dollar following reports that Iranian troops had entered Iraqi territory and raised the Iranian flag at an oilfield whose ownership is disputed by Iran.

"If there is tension developing in the Middle East, that would positive for the dollar because that would bring flight to safety ... that, in turn, could be negative for the equities markets," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

A strong U.S. dollar forces investors who have bet on a decline in the greenback to cover their short dollar positions by selling equities or other assets.

The Dow Jones industrial average (.DJI) added 20.63 points, or 0.20 percent, to 10,328.89. The Standard & Poor's 500 Index ( guaranteed payday loans.SPX) gained 6.39 points, or 0.58 percent, to 1,102.47. The Nasdaq Composite Index (.IXIC) climbed 31.64 points, or 1.45 percent, to 2,211.69.

DOW AND S&P 500 END WEEK LOWER

For the week, the Dow fell 1.3 percent, the S&P 500 shed 0.3 percent and the Nasdaq rose 1 percent.

The declines snapped a two-week winning streak for the Dow and a three-week series of gains for the S&P 500.

Trading was choppy as Friday marked the expiration of December options and futures, a convergence known as quadruple witching that often means increased volatility as big investors adjust or exercise derivatives positions.

Motorola Inc (MOT.N) shares jumped 5.2 percent to $8.53 after sources familiar with the matter said the mobile phone maker's set-top box unit has generated a lot of private equity interest, with a number of major buyout firms putting in initial bids this week.

In addition, the market was set to see an adjustment to the S&P 500. Visa Inc (V.N), up 2.2 percent at $88.97, is among companies that will be the newest additions to the benchmark index after the close.

Volume was extremely heavy on the New York Stock Exchange, with 3.16 billion shares changing hands -- more than double last year's estimated daily average of 1.49 billion. On the Nasdaq, about 2.91 billion shares traded, well above last year's daily average of 2.28 billion.

The regular session's volume for the New York Stock Exchange topped the previous record of 3 billion shares set on Sept 19, 2008.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of 3 to 2, while on the Nasdaq, 16 stocks rose for every 11 that fell.

(Editing by Jan Paschal)

Wall St gains in choppy trade; tech lifts Nasdaq

2009-Dec-18 - A Break at the Gas Pump

HOUSTON — This holiday season, consumers can expect a gift that should ease their burdens a bit: modestly lower gasoline prices.

Retail gas prices have been slipping gradually for weeks, thanks to the recent fall in oil prices. Some experts think the national average price for a gallon of gas — now $2.59 — could fall another nickel by Christmas.

“It couldn’t be more timely; it’s welcome news,” said Brian Bethune, chief United States financial economist for IHS Global Insight, who predicts that gas prices will drop to $2.50 a gallon by early next year. “The recent drop in gasoline prices has clearly contributed to an overall improvement in consumer confidence and right now that looks like it could build over the month.”

Economists note that a drop of a few cents a gallon will not make a big difference in the buying power of consumers, who on average spend about 3 percent of their disposable income on gasoline. But gasoline prices pack a psychological punch, in part because gas is the one consumer good whose price is advertised on street corners all over the country.

The recent decline in oil and gasoline prices comes less than two months after a price spike. In late October, crude oil prices rose above $80 a barrel and the national price of a gallon of regular gasoline soared by nearly 12 cents in a single week. Since October, oil prices dropped to about $70, then rose a bit in recent days to just under $73.

Gasoline prices still have not caught up with the initial decline, and they continue to slide, by about 4 cents a gallon in the last week.

Tom Kloza, chief oil analyst at the Oil Price Information Service, said the decline would most likely continue, despite the modest jump in oil prices in recent days. “I still think retail prices will fall by 5 to 10 cents by the end of the year,” he said. Noting that gasoline demand traditionally drops in January, he added, “Over the next 45 days, customers will get relief.”

Maribel Alvarez, a 42-year-old Houston homemaker, said the lower gasoline prices were “making a real difference” for her this holiday season. As she left a department store in the Galleria mall this week with a shopping bag full of sweaters, she added, “I can drive from place to place looking for bargains and it costs me less. Before, I was just shopping around my house.”

Oil analysts say the lower prices reflect the weak fundamentals of the world oil markets.

The demand for petroleum products dropped sharply this year as American and European consumers and businesses used less fuel because of the economic slowdown. Meanwhile, fuel inventories swelled, filling up storage facilities around the United States and forcing some oil companies to charter oil tankers for storage business card.

Oil demand typically rises in the winter, because of the higher demand for heating fuels. This year, however, the decline has been marked.

Over the last four weeks the nation’s oil consumption fell to 18.77 million barrels a day, nearly a million barrels fewer than over the same period last year and more than two million fewer than during the equivalent period in 2007, according to the Energy Department.

Gasoline consumption has rebounded from its lows reached during last year’s crisis, in December 2008, but it is still down by about 3 percent from two years ago.

The expectation of lower gasoline prices should be welcome news for retailers as they market holiday goods to consumers.

“If gasoline prices continue to go down from here, even modestly, it can only be a positive,” said Michael P. Niemira, chief economist for the International Council of Shopping Centers. But Mr. Niemira cautioned that gasoline prices were “not on people’s minds like they were when gasoline prices were much higher.”

He also noted that gas was about a dollar a gallon higher than this time last year, when the shock of the financial crisis sent oil and gasoline prices tumbling.

Projections by analysts of where oil and gasoline prices are going beyond the next few months range widely, which is not surprising since prices have been a roller-coaster ride in recent years.

Gasoline prices started the year at about $1.70 a gallon but climbed back to nearly $2.70 by June. Since then, national average prices have remained between $2.50 and $2.67.

According to a recent investment report from Commerzbank, a German bank, oil is poised to test a lower trading level around $65 a barrel. If that comes to pass, gasoline prices would probably fall further.

But JPMorgan Chase expects oil prices to turn around by the end of the first quarter next year. Over a longer period, that firm’s analysts see oil rising to $120 a barrel by 2013.

The rise and fall of fuel prices can have at least a short-term impact on economic activity. Larry Goldstein, a director of the Energy Policy Research Foundation, estimates that total economic output drops a half percent for every $10 increase in the price of a barrel of crude oil.

And Mr. Bethune of IHS Global Insight notes that since American consumers spend around $333 billion a year on gasoline for personal consumption, a 4 percent decline can mean about $13 billion in annual savings.

Clifford Krauss reported from Houston, and Jad Mouawad from New York.

A Break at the Gas Pump

2009-Dec-18 - World stocks drop as dollar hits 3-month euro high

LONDON – World stock markets fell Thursday while the dollar strengthened to a three-month high against the euro after the Federal Reserve signaled it would start undoing some of its emergency supports next year as the economic recovery gathers pace.

In Europe, the FTSE 100 index of leading British shares was down 64.53 points, or 1.2 percent, at 5,255.73 while Germany's DAX fell 44.15 points, or 0.8 percent, to 5,829.28. The CAC-40 in France was 30.13 points, or 0.7 percent, lower at 3,845.69.

U.S. stocks fell at the opening bell too after an unexpected rise in new weekly U.S. jobless claims suggested continued labor market weakness. The Dow Jones industrial average was down 45.72 points, or 0.4 percent, at 10,395.40 soon after the open while the broader Standard & Poor's 500 index fell 4.92 points, or 0.4 percent, to 1,104.26.

The main catalyst for the selling was Wednesday's release of the minutes to the last rate-setting meeting of the Fed.

Though the Fed reiterated its pledge to keep interest rates near zero, it noted improvements in the economy and detailed the beginnings of a plan to dismantling a number of its extraordinary lending measures in 2010.

The news stoked speculation the central bank might increase interest rates sooner than expected, leading many investors to shift out of stocks.

"The Fed's upgraded assessment of market conditions is indicative that it's nudging closer to what must be its ultimate goal of withdrawing financial support in early 2010," said Philip Gillett, sales trader at IG Index.

America's ultra-low borrowing costs have contributed to a nine-month bull run in stocks and the sharp fall in the dollar this year, but with investors eyeing more expensive borrowing costs sooner than anticipated, the U instant personal loans guaranteed.S. currency has recovered its poise.

By early afternoon London time, the euro was down 1.2 percent at $1.4368, having fallen to $1.4330, its lowest level since early Sept. 7. Meanwhile, the dollar was 0.3 percent higher at 90 yen.

While the dollar has been buoyed by higher bond yields, the euro has continued to come under pressure from Standard & Poor's downgrade of Greece's credit rating, arguing that the government's plan was unlikely to lead to a "sustainable" reduction in the country's debts.

"There is the risk of a contagion effect given the poor fiscal position in some European countries like Italy, Belgium and Ireland," said Neil Mackinnon, global strategist at VTB Capital. "This is all negative for the euro at the moment."

Since this is the last full trading week of 2009, traders know that investors may use the opportunity to sell stocks and lock in gains made over the last nine months.

Earlier in Asia, the Nikkei 225 stock average shed 13.61 points, or 0.1 percent, to 10,163.80, and Hong Kong's Hang Seng slid 264.11 points, or 1.2 percent, to 21,347.63.

Meanwhile, South Korea's Kospi dropped 1 percent to 1,647.84 and Shanghai's market tumbled 2.3 percent to 3179.08. Markets in Taiwan, Singapore and Indonesia also fell.

Australia's market bucked the trend, adding 0.2 percent.

Oil prices fell while the dollar spiked, with benchmark crude for January delivery down 65 cents to $72.01. On Wednesday, the contract surged by $1.97.

___

AP Business Writer Jeremiah Marquez in Hong Kong contributed to this report.

World stocks drop as dollar hits 3-month euro high

2009-Dec-17 - Health-care on hold as Senate turns to defense

WASHINGTON (MarketWatch) -- With Senate Democratic leaders still in search of 60 votes for their health-care overhaul, lawmakers were turning to a defense spending measure on Thursday as a possible weekend session loomed on health reform.

Senate Majority Leader Harry Reid on Thursday vowed to finish the bill before the chamber adjourns for Christmas "whether the other side cooperates or not." Reid is trying to win over Sen. Ben Nelson of Nebraska, a conservative Democrat who has reservations about the bill's language on abortion and other issues. Just one defection from the 60-member Democratic coalition could sink the bill.

But senators side aside the health debate on Thursday morning after more than two weeks of intense focus on the bill, taking up a $636 billion defense spending measure for 2010. The House passed the bill on Wednesday.

Democrats face more trouble in the Senate as they try to pass a health care reform bill by Christmas, Fox News' Doug Luzader reports. Courtesy Fox News.

Meanwhile, a new poll showed for the first time that more people would prefer that Congress does nothing on health-care than enact an overhaul.

In the latest Wall Street Journal/NBC News poll, 44% of respondents said the government should keep the current health-care system, while 41% said the Democrats' plan should be passed. Fifteen percent said they were unsure. Read the Journal/NBC poll.

Republicans are seizing on the negative poll numbers.

"Democrats know that the longer Americans see this bill, the less they like it," said Sen. Mitch McConnell of Kentucky, the Republican leader, on Thursday morning portable infrared heaters.

The Senate bill aims to extend insurance coverage to 94% of U.S. residents and currently carries a price tag of $848 billion over 10 years.

However, Reid and other senators are awaiting a fresh congressional analysis of the bill, factoring in a new national insurance plan. The plan, a substitute for a stronger government-run option, would be run by nonprofits set up by the private sector. The Office of Personnel Management, a U.S. government entity, would oversee the plan, which would be available to individuals on the insurance "exchanges" to be set up by the Democrats' bill.

The analysis from the Congressional Budget Office could be released as soon as Thursday.

On Tuesday, Sen. Nelson was still a holdout, saying he was concerned about proposed taxes and cuts in Medicare payments to health-care providers, The Wall Street Journal reported. Nelson is also demanding that the bill's limits on insurance coverage for abortion be tightened further.

The House's bill passed on Nov. 7 after passage of an anti-abortion amendment. The House bill would bar abortion coverage in the government-run insurance plan created by the bill and also in any plan on the exchanges to be set up by the bill that is sold to people getting government subsidies.

As written now, the Senate's bill would require the exchanges to offer plans with and without abortion coverage.

Health-care on hold as Senate turns to defense

2009-Dec-15 - U.K. wont compromise on bonuses

LONDON (MarketWatch) -- The U.K. government will not compromise on its planned 50% bonus tax, and may extend the rules to catch firms with unusual tax years, even as more firms reportedly consider moving high-paid staff overseas.

U.K. Chancellor Alistair Darling has refused requests to relax the terms of the tax -- which would be paid by banks on all bonuses over 25,000 pounds ($40,600) -- as firms claim it would raise far more than the 550 million pounds the Treasury estimated, the Financial Times reported.

The Treasury claims that the solution is for the banks to pay out less in bonuses, rather than to relax the tax rules, it added.

Indeed the rules, which originally applied to bonuses paid before April 5 next year, could be extended to catch firms such as Rothschild, whose unusual tax year means it pays bonuses in June, the Times (of London) reported.

Rothschild is soon to hire John Kingman, currently head of U.K. Financial Investments, which manages the government's stakes in Royal Bank of Scotland and Lloyds Banking Group , so failing to hit the investment bank with the same tax as its rivals could lead to accusations of favoritism.

While the terms of the tax may be extended, it's still not completely clear who it will apply to.

When it was announced, Chancellor Darling said it would apply to banks, but other firms including brokers and asset managers fear they could also be hit by a hefty tax bill.

Worries over U.K. taxation have led interdealer broker Tullett Prebon to offer its 700 broking staff the chance to transfer to its overseas offices, including in Switzerland, Singapore and Bahrain auto loans. As well as the bonus tax, a new top rate of income tax of 50% is due to come into force in April.

Shares in Tullett Prebon fell 1.9% in London Tuesday.

The FT reported Tuesday that one senior investment banker estimated 1,000 employees at his firm, and around 10,000 people across London, could easily be moved to overseas offices.

However, moving staff now wouldn't allow banks to avoid the bonus tax as it applies to employees who have worked in the U.K., no matter where they are currently based.

Most banks will still be free to choose whether they limit the size of their bonus pool in response to the tax. City A.M. newspaper reported Tuesday that Lloyds has decided to go ahead with its planned bonus payments and will therefore face a tax bill of 100 million pounds.

RBS, however, could see the government step in to put a limit on its payouts after it gave its main shareholders a veto on bonus policy as part of its deal to insure risky assets and strengthen its balance sheet.

Banking stocks have been mixed since the tax was announced as they have also been buffeted by Dubai's efforts to renegotiate the debt of the Dubai World conglomerate.

The sector was mostly lower Tuesday, with Barclays down 1.7% and HSBC down 2%, though RBS edged up 0.6%.

U.K. won't compromise on bonuses

2009-Dec-13 - Marsh on Monday: Farewell to Britains laissez-faire capitalism

LONDON (MarketWatch) -- For many years the British were world champions on the field of laissez-faire capitalism.

Whether in regulating financial markets or ruling foreign takeover bids for British companies, there was always just one standard Panglossian response. The interplay of free market forces will ensure that everything has a happy ending.

This is a surprising phenomenon, given the historical perspective. The Labour party, after all, has traditionally been in favour of intervention in economic and financial affairs. But after the election defeat of the Conservatives in 1997, the new government under Tony Blair (with present Prime Minister Gordon Brown as Chancellor of the Exchequer) maintained the former Tory administration's hands-off approach -- and even intensified a liberal course in economic and financial policies.

New Yorkers tell WSJ reporter Jodi Xu how they feel about the U.K.'s 50% tax on bank-bonus pay, and whether the U.S. should follow suit.

Not any more. The parliamentary elections, likely to be held in May next year, are casting ever-deepening shadows. And we have had a little thing called the financial crisis and the near-collapse of capitalism.

Neo-liberal economic models that used to guide Gordon Brown have now been unceremoniously dumped. The Labor administration has launched a new line in interventionism and, in what will probably be its last few months in office, is pumping it as if there's no tomorrow. (Which for Labour ministers is probably true.)

Peter Mandelson, the powerful and poker-faced Minister of Industry and No. 2 in the government after Brown government, is preaching a new doctrine in industrial policy. Out goes red-blooded capitalism and his previous defense of Britons becoming "filthy rich". In comes a verbal castigation of hostile takeovers (such as in the "Chocolate War" between domestic confectionery group Cadbury Plc and American food giant Kraft Foods Inc. .)

Mandelson has unveiled new measures to strengthen British industrial capacity in nuclear energy -- only three years after government-owned British Nuclear Fuels sold its Westinghouse nuclear development company to Toshiba of Japan. Mandelson took an overtly hard-nosed pro-British interventionist line over the restructuring of the European operations of the General Motors car group cash advance loan no fax. Freshly printed strategy documents from the Mandelsonian Ministry play up the role of manufacturing and the usefulness of industrial training for apprentices.

After a decade of neglect of such issues, many skeptics see such initiatives as too little, too late.

The most iconic performances are reserved for the banking sector.

Punitive taxes on bank bonuses announced last week by Chancellor of the Exchequer Alistair "Everybody's" Darling will miss their targets in many ways. The measure will apply only until April of next year, and is likely to encourage distortions and sidestepping in most convoluted fashion. These measures will end up sanctioning not the biggest, wealthiest and most inventive institutions, but the most vulnerable -- and will therefore accelerate concentration processes in banking. The opposite of what the government wants.

No matter, the people are pleased. Putting bankers in the stocks is all part of Darling's populist game. And it is accompanied by other attention-grabbing measures such as reducing taxes on the working class leisure activity, Bingo -- a form of lottery game much regarded in the clubs of Labour constituencies in the industrial north of the country.

Will this be enough to restore Labour's battered fortunes in the crucial months before the election? Given the dismal budget figures and the further tightening of economic competition from around the world, probably not. But the government wants to send a signal.

Labour activists see a more proactive approach to industrial policy as providing a useful marker against the laissez-faire Conservative Party.

Recently, however, Labour has had to defend itself against a fatal objection, namely that the importance of manufacturing industry has fallen since 1997 from a 20% share of gross domestic product to just 12% now. The rate of decline has more than doubled compared with the previous 18 years of Conservative rule.

Pitted against such devastating statistical ammunition, Labour's political froth on manufacturing -- no matter how cleverly packaged -- will have only limited effect.

Marsh on Monday: Farewell to Britain's laissez-faire capitalism

2009-Dec-12 - U.S. and Russia Open Talks on Limits to War in Cyberspace

The United States has begun talks with Russia and a United Nations arms control committee about strengthening Internet security and limiting military use of cyberspace.

American and Russian officials have different interpretations of the talks so far, but the mere fact that the United States is participating represents a significant policy shift after years of rejecting Russia’s overtures. Officials familiar with the talks said the Obama administration realized that more nations were developing cyberweapons and that a new approach was needed to blunt an international arms race.

In the last two years, Internet-based attacks on government and corporate computer systems have multiplied to thousands a day. Hackers, usually never identified, have compromised Pentagon computers, stolen industrial secrets and temporarily jammed government and corporate Web sites. President Obama ordered a review of the nation’s Internet security in February and is preparing to name an official to coordinate national policy.

On Nov. 12, a delegation led by Gen. Vladislav P. Sherstyuk, a deputy secretary of the Russian Security Council and the former leader of the Russian equivalent of the National Security Agency, flew to Washington and met with representatives from the National Security Council, State Department, Department of Defense and the Department of Homeland Security. Officials familiar with these talks said the two sides made progress in bridging divisions that had long separated the countries.

Indeed, two weeks later in Geneva, the United States agreed to discuss cyberwarfare and cybersecurity with representatives of the United Nations committee on disarmament and international security. The United States had previously insisted on addressing those matters in the committee on economic issues.

The Russians have held that the increasing challenges posed by military activities to civilian computer networks can be best dealt with by an international treaty, similar to treaties that have limited the spread of nuclear, chemical and biological weapons. The United States had resisted, arguing that it was impossible to draw a line between the commercial and military uses of software and hardware.

Now there is a thaw, said people familiar with the discussions.

“In the last months there are more signs of building better cooperation between the U.S. and Russia,” said Veni Markovski, a Washington-based adviser to Bulgaria’s Internet security chief and representative to Russia for the organization that assigns Internet domain names. “These are signs that show the dangers of cybercrime are too big to be neglected.”

Viktor V. Sokolov, deputy director of the Institute of Information Security in Moscow, a policy research group run by General Sherstyuk, said the Russian view was that the American position on Internet security had shifted perceptibly in recent months.

“There is movement,” he said. Before, bilateral negotiations were limited to the relevant Russian police agency, the Bureau of Special Technical Operations, the Internet division of the Ministry of Interior, and the F.B.I.

Mr. Sokolov characterized this new round of discussions as the opening of negotiations between Russia and the United States on a possible disarmament treaty for cyberspace, something Russia has long sought but the United States has resisted pay day loans.

“The talks took place in a good atmosphere,” he said. “And they agreed to continue this process. There are positive movements.”

A State Department official, who was not authorized to speak about the talks and requested anonymity, disputed the Russian characterization of the American position. While the Russians have continued to focus on treaties that may restrict weapons development, the United States is hoping to use the talks to increase international cooperation in opposing Internet crime. Strengthening defenses against Internet criminals would also strengthen defenses against any military-directed cyberattacks, the United States maintains.

An administration official said the United States was seeking common ground with the Russians.

The United Nations discussions are scheduled to resume in New York in January, and the two countries also plan to talk at an annual Russia-sponsored Internet security conference in Garmisch, Germany.

The American interest in reopening discussions shows that the Obama administration, even in absence of a designated Internet security chief, is breaking with the Bush administration, which had declined to talk with Russia about issues related to military attacks using the Internet.

Many countries, including the United States, are developing weapons for use on computer networks that are ever more integral to the operations of everything from banks to electrical power systems to government offices. They include “logic bombs” that can be hidden in computers to halt them at crucial times or damage circuitry; “botnets” that can disable or spy on Web sites and networks; or microwave radiation devices that can burn out computer circuits miles away.

The Russians have focused on three related issues, according to American officials involved in the talks that are part of a broader thaw in American-Russian relations known as the "reset" that also include negotiations on a new nuclear disarmament treaty. In addition to continuing efforts to ban offensive cyberweapons, they have insisted on what they describe as an issue of sovereignty calling for a ban on “cyberterrorism.” American officials view the issue differently and describe this as a Russian effort to restrict “politically destabilizing speech.” The Russians have also rejected a portion of the Council of Europe Convention on Cybercrime that they assert violates their Constitution by permitting foreign law enforcement agencies to conduct Internet searches inside Russian borders.

In late October at a luncheon during a meeting on Security and Counter Terrorism at Moscow State University, General Sherstyuk told a group of American executives that the Russians would never sign the European Cybercrime Treaty as long as it contained the language permitting cross-border searches.

U.S. and Russia Open Talks on Limits to War in Cyberspace

2009-Dec-12 - FundWatch: Bond-fund manager TCW hit with redemptions

NEW YORK (MarketWatch) -- Asset management giant TCW Group is facing trouble on several fronts after firing its chief investment officer Jeffrey Gundlach last week.

On Tuesday, the Treasury Department halted a fund it had established with TCW under its Public-Private Investment Program. The fund had raised about $1 billion in commitments to invest in toxic bank assets, according to the Wall Street Journal.

Kelly Crow discusses the art market's recent high sales for Old Masters paintings, and why some investors view Renaissance paintings as bond-like investments over the more-volatile contemporary art prices.

Treasury suspended trading in the fund while it performs due diligence on the new management team from Metropolitan West Asset Management. There is no indication how long the process will take or what Treasury will decide.

On Friday, Los Angeles-based TCW, owned by France's Societe Generale , said it had agreed a deal to buy rival bond fund manager Metropolitan West Asset Management and had that Gundlach had been let go. Read about TCW's purchase of Met West.

It was also reported on Wednesday that TCW has seen large redemptions, with reports of more than $1 billion leaving its flagship Total Return Bond Fund on Monday. The Los Angeles Times reported that Tad Rivelle, a Met West executive who replaced Gundlach as TCW's CIO, said redemptions were less than half of that on Tuesday.

TCW spokeswoman Erin Freeman declined to comment on the redemptions.

Freeman said Gundlach was dismissed because he "threatened to leave TCW and take key personnel with him cash advance payday loans." She didn't reveal further details.

"He left us no choice but to go out and find an alternative," said Freeman, "and we feel we found a team that matches him skill for skill."

Freeman wouldn't disclose the timeline regarding the Met West acquisition.

The $12 billion Total Return Bond Fund wasn't the only TCW fund shaken this week. Another fund previously managed by Gundlach, closed-end fund TCW Strategic Income Fund Inc. , saw its share price fall 6% on Monday on record trading volume, to close at $4.47 a share. It has since rebounded slightly, and closed at $4.56 a share on Wednesday.

Freeman said TCW had reached out to clients since the moves were announced. She said 30 Met West investment professionals started work in TCW's offices on Friday, and the rest of the firm will join by the time the acquisition is completed in the first quarter of 2010.

The Journal reported that Gundlach said in a conference call on Tuesday that his investment team would stay together and that he plans on "establishing our investment services on a new platform in very short order."

Gundlach added that he only talked about leaving TCW with his team after learning he was being forced out, according to the Journal. The paper also reported that Gundlach was set to earn $35 million to $40 million this year, citing people familiar with the matter.

FundWatch: Bond-fund manager TCW hit with redemptions

2009-Dec-4 - Movers & Shakers: Fridays biggest gaining and declining shares

NEW YORK (MarketWatch) -- Shares of the following companies were making notable moves early Friday in the U.S. stock market:

Big Lots, Inc. shares jumped 7% after the closeout retailer reported better-than-anticipated quarterly results.

Marvell Technology Group Ltd. shares gained 8.8% after the company, which makes chips used in data storage, posted results topping expectations. Read more about signs of increased demand for technology.

Matrix Service Co. shares advanced for a second day, lately up 7.3%, after an analyst upgrade of the industrial construction and repair services company.

Monster Worldwide Inc. shares ran 7.5% higher, with the operator of the online jobs site gaining after unexpectedly good news on the labor front. Read about the drop in the unemployment rate.

Robert Half International Inc. shares gained 8.5% after a BMO Capital Markets analyst said the loss of temporary jobs was less dismal in October than September, fueling buying of the staffing services company advance payday loans.

Synovus Financial Corp. shares were ahead 8% after its upgrade by FBR Capital.

UAL Corp. jumped 5%, with shares of the United Airlines parent rising on cheer over the unexpected fall in the U.S. unemployment rate to 10% in November.

Smith & Wesson Holding Corp. shares dropped 17% after the gun maker gave a weak sales forecast for the next quarter. Read press release.

Take-Two Interactive Software Inc. shares fell 33% after the video game publisher late Thursday reported fourth-quarter and 2009 results below prior guidance. See more about poor performance of "MajorLeague Baseball" titles.

Movers & Shakers: Friday's biggest gaining and declining shares

2009-Dec-2 - GameStop shares tumble on Walmart game deals

NEW YORK – GameStop Corp.'s shares took a hit Wednesday after an announcement from Walmart that the big retailer is offering deals on popular video games and the Nintendo Wii leading up to the holidays.

Wal-Mart Stores Inc. said it is lowering the prices of 25 of the most popular video games — such as "Halo 3:ODST" and "Left 4 Dead 2" — until Christmas Eve by 15 percent to 20 percent.

It's also running a promotion from Saturday through Dec. 12 giving shoppers who buy the $199 Wii game console a $50 gift card.

Investors sent GameStop shares sharply lower Wednesday amid worries that the Walmart deals could undercut GameStop's holiday sales.

"This news is clearly a negative for (GameStop) which generates the bulk of its sales during the holiday season and may be forced to reduce prices to stay competitive," said Janney Capital Markets analyst Tony Wible in a note to investors. "We would note that many of the (GameStop) stores overlap in close proximity to a (Walmart) store as (GameStop) as historically sought to benefit from (Walmart) foot traffic."

On Wednesday, GameStop's Web site listed "Left 4 Dead 2" as selling for $39.99 — down from its regular price of $59.99. "Halo 3" ODST" was listed at $39.99 as well, down from $49.99.

These are lower than the $50 that Walmart is asking for the games, but it was not clear whether GameStop's deals were in response to the Walmart price cuts.

A GameStop representative could not immediately be reached for comment Wednesday bad credit pay day loans.

Other games, such as "Mario & Sonic at the Olympic Winter Games," are cheaper at Walmart, and GameStop isn't offering a gift card for a Wii purchase.

Even so, GameStop has been optimistic about the holidays, and in November it reaffirmed its guidance for the fourth quarter.

Games are not the only category Walmart is discounting as it tries to lure shoppers to its stores. Online, the retailer along with rivals Amazon.com Inc. and Target Corp. have been locked in a price war on highly anticipated books and DVDs.

GameStop, like most video game companies, makes a big chunk of its annual revenue during the holiday season. Walmart's decision to focus on video games with its holiday price cuts takes advantage of the sector's popularity as gifts.

Games are unlikely to do as well this year as they did last year, when Americans spent more than $21 billion — a record — on game software, hardware and accessories, according to NPD Group. This year there have been fewer hit games and the recession has led customers to be more selective about what games they buy.

Shares of GameStop fell $2.18, or 9.1 percent, to $21.66 in afternoon trading. In the past 52 weeks, the stock has traded between $20.02 and $32.82.

GameStop shares tumble on Walmart game deals

2009-Dec-1 - AIG, Las Vegas Sands, US Bancorp are big movers

NEW YORK – The following stocks were among those that moved substantially or traded heavily Monday on the New York Stock Exchange and the Nasdaq Stock Market:

NYSE:

American International Group Inc., down $4.90 at $28.40

A Sanford Bernstein analyst reportedly said the embattled insurer doesn't have enough reserves to pay some potential claims.

Las Vegas Sands Corp., down 47 cents at $15.32

The company's Sands China tumbled in its first day of Hong Kong trading after raising $2.5 billion in an initial public offering.

DreamWorks Animation SKG Inc., up 94 cents at $33.47

An analyst upgraded DreamWorks and said the stock has fallen to more "reasonable" levels after speculation of a possible buyout faded.

US Bancorp, up $1.18 at $24.13

A RW Baird analyst said the stock price makes it an attractive buy and upgraded shares to the firm's highest investment rating low fee payday advance.

Supervalu Inc., down 59 cents at $13.83

An analyst downgraded the stock and forecast trouble despite the grocer's attempts to lower prices and turn around its business.

Gamestop Corp., down 91 cents at $24.41

Investors worried hat video games may not sell as well early this holiday season as many had hoped.

Aflac Inc., up $2.38 at $46.03

An analyst upgraded the supplemental insurance provider, citing its ability to offset potential credit losses and an improving outlook.

NASDAQ:

Clarient Inc., up 20 cents at $2.55

The medical device maker signed an exclusive license to technology aimed making better tests for cancer.

AIG, Las Vegas Sands, US Bancorp are big movers