11/10/07

After the close, the United Auto Workers said it reached a tentative deal with Chrysler that will put an end to the brief labor strike that began early Wednesday. Separately, the UAW workers at GM have ratified their four year contract that was first settled in late September following a two day strike.

Alcoa reported late Tuesday that it earned 64 cents per share, up from 62 cents a year ago and 2 cents shy of estimates. Revenue fell from a year ago, but met forecasts. Alcoa also said it was upping its stock buyback authorization to 25 percent of outstanding shares from 10 percent currently.

Boeing said that it was delaying the delivery of its first 787 Dreamliner planes by six months, due to assembly problems. The company said that the delay won't hit 2007 and 2008 earnings, but investors sent the stock lower anyway.

Qwest Communications fell 5 percent in active NYSE trading after UBS downgraded the stock to neutral from buy.

On the upside, Costco reported quarterly earnings that topped estimates and said September sales as stores open for a year or more rose more than expected.

In economic news, a government report showed that August wholesale inventories rose a smaller than expected 0.1 percent after rising 0.2 percent in July.

Treasury prices fell, raising the yield on the 10 year note to 4.65 percent from 4.64 percent.

COMEX gold for December delivery rose $2.90 to settle at $746 an ounce.

US light crude for November delivery rose $1.04 to settle at $81.30 a barrel on NYMEX.

In Tokyo the Nikkei average closed 281.1 points higher today at 17459, despite some weak economic data out before the open. Japan's core private sector machinery orders, a gauge of corporate capital spending, fell 7.7 percent in August from the previous months, government data showed. The compared with analysts forecasts of a 6 percent decline. Nintendo Co continues to hit record highs after it said it would start selling its Wii Fit home fitness game in Japan in time for the critical year end shopping season.

Sony Financial Holdings, Sony Corp's financial unit, made its market debut, opening up 5 percent from its IPO price of 400,000 yen.

UK stocks closed 17.6 points higher at 6633 on Wednesday as shares in Northern Rock jumped and miners supported. Northern Rock added 32.3 percent to the FTSE100 leaderboard as funds built stakes in the company. Encouraged by new government guarantees that have boosted hopes of a rescue package.

Schroders added 5.7 percent as traders said the stock as a "chart breaker", after record highs in US markets overnight.

European airlines were also strong, with British Airways 4.6 percent higher as dealers said the sector was oversold and was benefiting from takeover activity and an improving economic backdrop for cyclicals.

Woolworths added 9.3 percent in heavy volumes on market talk of bid interest in the company from WM Morrison. Morrison and Woolworths both declined to comment.

Cadbury Schweppes rose 2.6 percent after it said that it will focus on demerging its North American soft drinks unit rather than selling it. The group also said in a trading statement that it had seen very strong third quarter confectionery revenue growth of 10 percent.

The negative news on the housing market is mounting, and this survey is not expected to break the trend. New buyer interest is expected to continue to decline and to see a larger percentage of surveyors reporting prices falling against prices rising last month.

EMU ECB monthly bulletin (Oct) 09.00 bst

The overall tone of the monthly bulletin generally reflects the introductory statement of the previous weeks press conference. The ECB occasionally uses the insight boxes to underline issues it believes warrant clarification or broader understanding.

EMU GDP (Q2, final) 10.00 bst

The final reading of Q2 GDP is expected to remain unchanged at 0.3 percent quarter on quarter, 25 percent year on year. The breakdown showed that private consumption had recovered to 0.5 percent quarter on quarter, but investment contracted on the quarter by 0.2 percent following an extraordinarily strong 2 percent quarter on quarter gain in Q1. Construction is likely to have been a drag after a mild winter and the VAT effect in Germany, which led to a front loading in construction activity.

US Trade balance (Aug) 13.30 bst

The August trade deficit is expected to remain relatively unchanged at USD 59bn. Exports could rise by USD100m. Export prices (+0.2 percent) rose a bit, but exports volumes may slow for both autos and non auto capital goods. Imports are expected to decline by USD200m, as import prices fell 0.3 percent.

US Initial jobless claims (Week 6 October) 13.30 bst

Last weeks initial jobless claims rose 317,000 from 310,000. The 4 week average rose to 312,750. This week claims are seen at 315,000. However, this reading has the potential to be noisy, as it covers the first week of a new quarter, when claims are seasonally expected to spike higher.

Aventus Capital Management is a trading style, "Aventus" is a trade mark and the Aventus logo is a registered trade mark of Rickerbys Solicitors. Rickerbys is regulated by the Solicitors Regulation Authority. Authorised and regulated by the Financial Services Authority.