Forex Investment

BOMBAY (XFN-ASIA) - The Reserve Bank of India (RBI) kept key short-term borrowing rates unchanged as it seeks to keep economic growth on track despite inflation running well above its comfort zone.

The central bank has already raised short-term lending rates twice this year, by a quarter of a percent each time, to 7.75 pct — its highest level in more than four years to contain inflation running above 6 pct.

The central bank aims for an annual inflation rate of 5.0 to 5.5 pct and said in a regular quarterly review that the earlier rate hikes should help to being price rises down towards the lower end of that range.

“In view of the lagged and cumulative effects of monetary policy on aggregate demand, the policy would be to contain inflation close to 5.0 percent,” in the fiscal year started April 1, the bank’s governor Y.V. Reddy said in a statement.

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WASHINGTON—Orders for long-lasting U.S.-made goods rose in June, the government reported Thursday, but were below Wall Street expectations and a measure of business spending in the data fell unexpectedly, prompting concern about economic growth.

In another report, the number of new claims for U.S. unemployment benefits fell unexpectedly in the latest week to the lowest in more than two months.

The employment figures did little to sooth investors considering the disappointing durable goods data in a climate of fear that credit could be drying up.

New orders for goods meant to last at least three years rose 1.4 percent in June on an increase in nondefense aircraft. Wall Street economists had been looking for an increase of 1.8 percent.

Within the report, nondefense capital goods orders excluding aircraft — seen as a good gauge of business spending — fell 0.7 percent, well below economists’ expectations for an 0.8 percent gain.

The bond market extended price gains on the data, while equities indexes fell across the board after the open.

The data added to overall concerns about the economy and a worsening climate for deal financing as investors continue to fret that the crisis in the subprime mortgage sector could lead to a sharp reduction in the availability of credit.

“It’s not good, really,” said Michael Metz, chief investment strategist at Oppenheimer & Co. in New York.

“You ex out transportation, it’s certainly a disappointment,” he said, referring to durable goods orders excluding transportation, which fell 0.5 percent. Economists had expected an 0.5 percent gain.

Investors found some minimal solace in the report showing initial jobless claims for state unemployment benefits fell for the third week to 301,000 in the week ended July 21 from an upwardly revised 303,000 the prior week.

That marked the lowest level of weekly initial jobless claims since May 12, and was below expectations for a reading of 310,000.

Updated from 7:41 a.m. EST

Tech shares were getting a major boost from Cisco (CSCO) early Wednesday, but blue chips remained in a holding pattern.

Futures on the Nasdaq 100 were gaining 8.75 points to 1812.25 and were more than 10 points ahead of fair value. S&P 500 futures were up 2.2 points at 1455.50 and were 3.35 points above fair value.

So far this week, the major averages haven’t strayed very far from the flat line. On Tuesday, the Dow Jones Industrial Average was up 4.57 points at 12,666.31, and the S&P rose 1.01 points. The Nasdaq Composite added 0.89 point to 2471.49.

The market was also bogged down Monday, when the Dow gained just 8.25 points and the Nasdaq slipped 5.28 points.

However, tech shares were finally finding buying interest as a new session got underway thanks to a 5.3% increase in Cisco. The networker said after the prior close that its sales for the third quarter would be better than previously thought.

Traders were shrugging off comments from Philadelphia Federal Reserve President Charles Plosser, who said he is “not convinced that underlying inflation is on a downward trend.”

“Inflation stopped accelerating in the last few months, but whether it will continue to recede in the coming year is not yet clear,” said Plosser. “Additional monetary policy action may be needed to keep us moving along the path to price stability. We may simply be seeing the temporary effect of recent declines in the price of oil, which seems just as likely to rise as to fall in the future.”

On the economic front, the Labor Department said that fourth-quarter productivity rose at an annualized rate of 3%, a faster clip than expected. Unit labor costs rose at a 1.7% rate, below the consensus 2.1%. Third-quarter productivity was revised upward to 3.2%.

“This solid performance indicates the growth potential of the U.S. economy remains formidable and greater than economists and policymakers have been inclined to acknowledge,” said Peter Morici, professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission. “Profits and stock prices should continue to surge higher.”

Elsewhere, Treasuries were declining. The 10-year note was down 4/32 in price and yielding 4.78%, and the 30-year bond was off 5/32 to yield 4.88%. The dollar rose against the yen and euro but fell against the British pound.

Commodities were generally higher. Crude oil futures were up 55 cents at $59.43 a barrel, and natural gas rose 10 cents to $7.71 per million British thermal units. Gold gained $1 to $659.70 an ounce.

In other earnings news, News Corp. (NWS) posted fiscal second-quarter earnings that eased from a year-ago but still came in higher than estimates. Shares closed Tuesday at $24.15.

DirecTV (DTV) , in which News Corp. owns a big stake, said fourth-quarter earnings rose to $356 million, or 29 cents a share, nearly tripling from the year-ago results. Analysts expected it to earn 30 cents a share. DirecTV was recently up 53 cents, or 2.2%, to $24.50.

Sara Lee (SLE) swung to a fiscal second-quarter loss of $62 million, or 8 cents a share, compared with a profit of $438 million, or 57 cents, a year ago. One-time charges weighed down Sara Lee by 29 cents a share, making adjusted profits about 21 cents. Wall Street was expecting earnings of 16 cents a share.

Stocks were mixed in Europe, where London’s FTSE 100 eased 0.01% to 6345 and Frankfurt’s Xetra DAX added 0.3% to 6896. As for Asia, Tokyo’s Nikkei 225 fell 0.7% to 17,292, and Hong Kong’s Hang Seng was up 0.1% to 20,680.

June 24, 2007 — There’s a new blowhard on Broadway.

Not on stage, mind you, but in the bathrooms of one Times Square multiplex.

James Dyson, the man who pitches vacuums on television, is looking to take the very pedestrian - and germ-ridden - public bathroom hand-dryer upscale by introducing his Dyson Airblade, a high-tech gadget that blows air at 400 mph and promises to cut down wait time by drying hands in 12 seconds.

The Airblade will make its U.S. debut this week at the AMC Times Square movie house.

“People are impatient,” Gordon Thom, who heads up Dyson’s Chicago-based U.S. operations, said in addressing one of the selling points of his new product - the speed at which it dries your hands.

Instead of evaporating the water like most hot-air dryers currently do, the Airblade blasts the water clear off your skin.

Dyson launched the Airblade hand dryers in Great Britain early this year. Among the locations using them are rest stops, department stores, sports venues, health clubs and even Gatwick airport. A power utility bought 200 of them.

While the Airblades may be fast and less germy - because you never have to touch them - they are, at $1,400 a pop way more expensive. So while they blow hard, they also suck more cash from business’ wallets.

Dyson is pushing the fact that they are more economical to operate because they use less energy and they are a substitute for more expensive paper towels.

LONDON (Thomson Financial) - Here are the top stories on Thomson Financial News

US Q1 GDP up 1.3 pct vs 1.9 pct rise expected, slowest rise since Q1 2003

WASHINGTON (Thomson Financial) - The US economy continued to slow in the first part of the year, growing at the slowest annual pace in four years, while at the same time a key measure of inflation continued to rise, the Commerce Department said today.

The department estimated the economy grew at a 1.3 pct annualised rate between January and March, slower than the 1.9 pct economists had expected for the quarter and the slowest annualized pace since the first quarter of 2003.

OFT recommends Competition Commission inquiry into BSkyB’s ITV stake buy

LONDON (Thomson Financial) - Britain’s Office of Fair Trading said British Sky Broadcasting’s controversial purchase of a 17.9 pct stake in ITV late last year should be referred to the Competition Commission for further investigation.

In a report that has been handed to the Department of Trade and Industry, the OFT said BSkyB’s November swoop on ITV had caused “a substantial lessening of competition” within the UK TV industry.

AT&T CEO Whitacre to retire June 3

(AP) - SAN ANTONIO — AT&T Inc. Chairman and chief executive Edward Whitacre Jr. said Friday he will retire on June 3 after 44 years with the nation’s largest telecommunications company.

Whitacre, 65, also announced at the company’s annual meeting that the board has elected Chief Operating Officer Randall Stephenson, 47, to replace him.

Royal Bank of Scotland consortium says intends to make public offer for ABN

LONDON (Thomson Financial) - A consortium of Royal Bank of Scotland Group PLC, Banco Santander Central Hispano and Fortis NV has said that it intends to make a public offer for 100 pct of ABN Amro Hldgs NV.

The banks said that under Dutch regulations they cannot disclose full terms of the offer for seven days, but on Wednesday the consortium indicated that it may offer 39 eur per share for the Dutch bank, providing that the sale of LaSalle to Bank of America Corporation does not go through.

Sulzer drops Bodycote takeover ambitions

LONDON (Thomson Financial) - Swiss engineering group Sulzer said it will not pursue its attempted takeover of Bodycote International after its UK rival knocked back an indicative 344.5 pence per share offer earlier today.

Earlier today, Bodycote rejected the improved 1.1 bln stg bid, saying it was short of the figure Bodycote told Sulzer would be enough to allow them access to Bodycote’s books.

Statoil to acquire Canada’s North American Oil Sands Corp for 2 bln usd

OSLO (Thomson Financial) - Statoil ASA said it has an agreed an all-cash offer to acquire Canada’s North American Oil Sands Corporation (NAOSC), in a deal worth 2 bln usd, or 20 cad per share.

Calgary-based NAOSC, was formed in 2001, and operates more than 257,000 acres of oil sands leases located in the Athabasca region of Alberta, north-east of Edmonton.

German April preliminary CPI up 0.4 pct from March, up 1.9 pct yr-on-yr

WIESBADEN, Germany (Thomson Financial) - Consumer prices in Germany rose 0.4 pct in April from March and were up 1.9 pct from a year earlier, according to preliminary data from the Federal Statistics Office.

Economists polled by Thomson Financial News had forecast an increase of 0.2 pct month-on-month and an increase of 1.7 pct year-on-year.

Chevron Q1 profit rises

SAN RAMON, Calif (Thomson Financial) - Chevron Corp reported a higher first-quarter profit as a strong showing from the downstream operations offset a decline in upstream earnings.

The US oil group posted a first-quarter net income of 4.7 bln usd, or 2.18 usd per share, compared with 4.0 bln usd, or 1.80 usd per share the same time last year.

Microsoft’s Vista sales boost 3Q profit

SEATTLE (AP) - Shares of Microsoft Corp. soared nearly 5 percent Friday, after the company posted a 65 percent jump in third-quarter profit, boosted by sales of its new Windows Vista operating system and Office 2007, and by upgrade coupons issued over the holidays.

The results eased fears that Vista is too pricey, requires too many hardware upgrades and doesn’t work with other companies’ applications.

Japan’s Mitsubishi Corp posts record FY profits, sales; sees minor fall this FY

TOKYO (XFN-ASIA) - Mitsubishi Corp said its net profit for the fiscal year ended March surged nearly 19 pct from the year before to a record 415.89 bln yen, bolstered by its commodity and energy-related businesses.

But Japan’s largest trading house forecast a decline in profits in the current fiscal year due to an expected peak-out of commodity prices.

Renault Q1 sales 10.256 bln eur; worldwide car sales down 3.8 pct

PARIS (Thomson Financial) - Renault SA said first-quarter sales fell 2.7 pct to 10.256 bln eur from a restated 10.541 bln eur a year earlier, as a decline in European sales led to a 3.8 pct fall in the group’s worldwide car sales.

Cheuvreux analysts had been expecting total first-quarter sales of 10.293 bln eur while Exane BNP Paribas had forecast 10.600 bln.

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