5 Aug, 2010: NEW YORK — Stock futures were narrowly mixed Thursday as caution remains ahead of two key jobs reports over the next two days.

Analysts say unemployment remains the biggest hurdle to a stronger recovery, and traders avoided any big moves before the Labor Department's two reports. The economy continues to grow, but the pace of the rebound has slowed in recent months. That's because consumers have scaled back spending and started saving more as unemployment remains high and employers continue to avoid significant hiring.

Retailers are reporting monthly sales figures throughout the morning. Signs of spending growth could indicate confidence is starting to creep back in among shoppers.

The Labor Department is expected to report Thursday that initial claims for unemployment benefits fell by just 2,000 last week to 455,000, according to economists polled by Thomson Reuters. It would be the second straight weekly decline, but claims are still too high to indicate broad hiring. Claims have hovered around 450,000 throughout the year, meaning that job cuts aren't prevalent like during the recession, but hiring hasn't picked up either.

The report is due out at 8:30 a.m. EDT.

The weekly claims data has become one of the more important economic readings each week because of how dependent growth is on new jobs. But unless the report is vastly different from expectations, it might have little effect Thursday because of the monthly report on employment is being released Friday.

The monthly report is expected to show private employers hired 90,000 workers in July, a slight increase from the 83,000 hired in June. But because of government layoffs tied to cutting temporary census jobs, the unemployment rate is expected to rise to 9.6 percent from 9.5 percent.

Ahead of the opening bell, Dow Jones industrial average futures rose 8, or 0.1 percent, to 10,643. Standard & Poor's 500 index futures fell 0.10, or less than 0.1 percent, to 1,124.50, while Nasdaq 100 index futures rose 4.75, or 0.3 percent, to 1,910.00.

The weekly and monthly reports over the next two days come after private payroll company ADP said Wednesday that private employers hired 42,000 people last month. The ADP is often used as a gauge ahead of the broader Labor Department report, which also includes government jobs with private sector employment.

Stocks rose Wednesday after the better-than-expected report from ADP and unexpected growth in the services industry. The Dow rose 44 points.

Meanwhile, bond prices traded in a narrow range Thursday as investors avoid big moves. The yield on the 10-year Treasury note, which moves opposite its price, fell to 2.95 percent from 2.96 percent late Wednesday. Its yield is often used as a benchmark for interest rates on mortgages and other consumer loans.

Overseas, Britain's FTSE 100 rose 0.3 percent, Germany's DAX index rose 0.6 percent, and France's CAC-40 rose 0.9 percent. Japan's Nikkei stock average rose 1.7 percent.

Copyright © 2010 The Associated Press. All rights reserved.
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Aug. 5 (Bloomberg) -- Japanese bonds fell, lifting 10-year yields from a seven-year low, as stocks advanced after Toyota Motor Corp. raised its full-year profit forecast.

Benchmark 10-year yields, which yesterday fell below 1 percent for the first time since August 2003, gained before a government report that economists say will show business conditions are improving. The Ministry of Finance will sell 300 billion yen ($3.47 billion) in 40-year bonds today.

"Ten-year yields below 1 percent aren't a 'flight to quality' but a 'speculative investment in quality'," Shinji Nomura, chief debt strategist at Nikko Cordial Securities Inc., wrote in a report today. "This may be the last time for 10-year yields to fall below 1 percent in history, and I think this is a great opportunity to sell."

The yield on the benchmark 10-year bond added two basis points to 1.015 percent as of 9:19 a.m. in Tokyo at Japan Bond Trading Co., the nation's largest interdealer debt broker. The 1.1 percent security due June 2020 fell 0.182 yen to 100.761 yen.

Ten-year bond futures for September delivery lost 0.14 to 142.15 at the Tokyo Stock Exchange.

Shares of Toyota, the world's largest automaker, jumped 2.4 percent in Tokyo after boosting its annual net income projection by 9.7 percent yesterday.

The Nikkei 225 Stock Average climbed 2.1 percent, buoyed by the Institute for Supply Management's report yesterday that showed its index of U.S. service industries gained in July, while economists had estimated the gauge would drop.

'Excessive Pessimism'

"Japan's bond market will likely open lower as excessive pessimism about the U.S. economy eases," Nikko's Nomura wrote before markets opened in Tokyo.

Japan's leading index of business conditions rose to 98.7 in June from 98.6 the previous month, according to economists' estimates before the report tomorrow. That would be the first gain in three months.

The prior sale of Japanese 40-year bonds in May drew bids for 2.57 times the amount on offer, compared with a so-called bid-to-cover ratio of 3.78 in January. Primary dealers, which are required to bid at government debt sales, often reduce holdings of bonds in case prices decline before they can pass on the new securities to investors.
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5 Aug 2010 - TORONTO: Problems continued to mount for BlackBerry maker Research In Motion (RIM) on Wednesday as its stock sank more than four per cent further after dropping by a similar margin on Tuesday.

With the new BlackBerry Torch 9800 not getting a great response and Indonesia joining the UAE and Saudi Arabia to seek a ban on BlackBerry, RIM shares were hammered on the markets, losing $2.7 billion in just two days.

With Goldman Sachs making "sell" recommendation on it, RIM stock sank 4.46 per cent Wednesday to close at $54.24. The stock has fallen more than 20 per cent in 2010 as it Apple's iPhone 4 and Google Android have made a major dent into BlackBerry market in North America.

With its current business of worth $15 billion globally, BlackBerry has more than 41 million subscribers in over 150 countries.

Unlike iPhone 4 or other smart phones, BlackBerry emails don't go over the internet. They are first encrypted to be secured on the device and then routed through its own secure servers which cannot be accessed even by RIM. But the foolproof security feature which made BlackBerry the smart phone of choice for corporates, businesses, professionals and governments, has now become its major headache.

Indonesia joined India, the UAE, Saudi Arabia Wednesday to seek access to data on BlackBerry devices which is routed through RIM servers. With about 1.2 million BlackBerry users, it wants RIM to install a local mini server so that the data is routed locally, not through RIM servers abroad.

But amid mounting pressures from foreign governments, RIM repeated on Wednesday that it won't compromise on its security features.

In a statement, the wireless giant said, "The BlackBerry enterprise solution was designed to preclude RIM or any third party, from reading encrypted information under any circumstances, since RIM does not store or have access to the encrypted data.

"Any claims that we provide, or have ever provided, something unique to the government of one country that we have not offered to the governments of all countries are unfounded."

But there was even more worrying news for RIM from the US where Google Android smart phones have outsold BlackBerry in the second quarter of 2010.

The US market research firm NPD Group says Android devices accounted for 33 per cent, BlackBerry 28 per cent and iPhone 22 per cent of all handsets sold in the US in the second quarter of the current year.

stocks, bonds & forex trading source: economictimes.indiatimes.com

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U.S. stocks could do well this week if monthly jobs data, due out Friday, and corporate results paint a more promising picture of the recovery.

The Standard & Poor's 500 index has been stuck in recent days amid recent weak economic data and disappointing outlooks from companies including technology firms Nvidia Corp. and Symantec Corp.

The tech-heavy Nasdaq composite had the poorest performance of the three major indexes last week, and activity in the options market points to more volatility in the tech sector this week.

Among companies expected to report quarterly earnings this week are Procter & Gamble Co. and Clorox Co., whose results could give another glimpse into the strength — or weakness — of consumer spending.

But the Labor Department's nonfarm payrolls report for July, due Friday, looms large. Sluggish job growth is considered the biggest hurdle to advances in the economy and stock market.

Data released last Friday showed that U.S. economic growth slowed in the second quarter, and the June labor report released last month showed a fall in payrolls. Both of those raised concerns about the recovery for the rest of the year.

"We have been reducing our exposure to equities because we are concerned that a weaker economy is going to continue throughout the end of year," said Joseph Battipaglia, a market strategist at Stifel Nicolaus in Yardley, Pa.

Analysts say a significant break above the S&P 500's average for the last 200 days — currently about 1,114 — would be a bullish signal.

"The market has the potential to push higher again if we can get through the 200-day moving average," said Michael Sheldon, chief market strategist at RDM Financial in Westport, Conn.

Chris Burba, a short-term market technician at Standard & Poor's in New York, noted that the 200-day moving average has been nearly flat since late June, which supports the view that investors should be cautious.

The U.S. economy, recovering from the worst recession since the 1930s, has shown weakness in recent months, and corporate results for the second quarter have been mixed.

Earnings growth for S&P 500 companies in the second quarter is expected to be 36%, while revenue growth is estimated at 9.1%, according to Thomson Reuters data.

In other key economic data this week, the Institute for Supply Management's manufacturing report, due out Monday, is expected to show growth for a 12th straight month.

Copyright © 2010, The Los Angeles Times
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Q: What can investors expect to be the worst-case scenario for the Dow this year?

A: If there's one thing you can expect from financial markets it's unpredictability.

While stocks have generated average annual compound growth rates upward of 10% over time, the path has been far from smooth. To earn the market's returns, you need to endure gut-wrenching bear markets and keep yourself in check during euphoric highs.

The key to success in investing is to prevent panicking during market declines, and have the courage to buy beat-up investments on the cheap. Conversely, during times other investors are overly optimistic, you should avoid the urge to load up on overpriced investments and think about selling some of your winners.

It sounds easy, but during a market drop or a rally, it can be difficult to keep your head. A great way to stay grounded is to a have an idea of what kinds of returns, or declines, it's reasonable to expect. And I can answer that.

There are several ways to get a decent idea of what the future might hold for stocks. One way is by examining historical statistics. You've probably heard the boilerplate warning that past performance isn't a predictor of future returns. And that is certainly true in the short term.

But, if you examine market returns for many decades, you can get an idea of what kinds of risk and reward you can expect over the long haul.

Analyzing returns of the IFA U.S. Large Company index, a good measure of how large U.S. stocks have done, gives you a reasonable idea of how stocks have fared. The IFA U.S. Large Company index contains large stocks, as does the Dow.

Specifically, the IFA U.S. Large Company index has returned 9.2% a year, on average, since 1928. And that's a good reason why you can reasonably expect a 9% to 10% annual average return over the long run. Again, don't think you're going to get a 9% to 10% return each year. Nothing could be further from the truth.

The IFA U.S. Large Company index is risky, meaning you can expect giant swings in returns from year to year. To be precise, there's a 68% chance that stocks will have an annual return ranging from a 28.5% gain to a 10.1% loss. You can expect your stock returns to be in that band most years.

However, as investors have learned recently, market volatility can be even more severe. Statistically, there's a 48% change that stocks could fall as much as 29.4% in any given year. And there's a 49.8% chance stocks could fall as much as 48.8% in a year.

As you can see, most of the time stocks' downside risk is less than 10.1% in a year. But by investing, you are accepting the risk that losses could be greater than that. Much greater than that.

If these possible losses scare you, it might be a sign you're not invested properly. By adding other types of investments to your portfolio, like bonds, you can help smooth out the ups and downs.stocks, bonds & forex trading - source: www.usatoday.com

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