Unstructured Finance

A British-Iberia merger could squeeze American

July 31, 2008

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British Airways and Spain’s Iberia are in talks to create the world’s third-largest airline and inject some “long-overdue” consolidation in the industry, in the words of BA CEO Willie Walsh.

J. Crew’s mea culpa shows Mickey’s modest side

July 31, 2008

mickey.jpgJ. Crew is getting personal with an emailed mea culpa apologizing to customers who may have had “issues” while shopping online in recent weeks.

Check Out Line: Talbots’ makeover includes board

July 31, 2008

talbots3.jpgCheck out the majority owner of Talbots exerting more control.

The women’s apparel retailer, which has endured hardships in recent months including falling sales, job cuts, an executive departure and a credit problem, said on Thursday that Tsutomu Kajita would become chairman of its board.

Reality Bites

July 31, 2008

An unidentified protesting shareholder faces Deutsche Bank CEO Ackermann during the annual shareholders meeting in FrankfurtDeutsche Bank‘s latest writedown comes with a reality check – the global credit crisis it had largely fought off is still snarling away. The top German bank’s $3.6 billion in fresh writedowns come with a reversal of optimism from CEO Josef Ackermann. “We remain cautious for the remainder of 2008,” he said as his bank became one of the world’s top crisis casualties. As late as November, Ackermann had been suggesting no further writedowns would be necessary, and had stood by a 2008 pretax profit goal of 8.4 billion euros. Now, with no indication that the books are completely cleaned of toxic paper, further write-offs seem a lot less unlikely and that full-year profit goal is going quietly by the wayside.

Huntsman and Hexion spar anew

July 30, 2008

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Chemical maker Huntsman Corp’s second-quarter earnings have triggered a new round of sparring with its disgruntled suitor, Hexion Specialty Chemicals.

Clear Channel closes — finally

July 30, 2008

drumroll.jpgDrumroll, please: Almost two years after radio station and billboard company Clear Channel Communications began exploring strategic options, its $17.9 billion takeover finally closed on Wednesday.

Europeans are coming

July 30, 2008

beer1.jpegTwo takes from the latest data on U.S. M&A activity so far: The Europeans are coming like never before — and buying their beer here — and the credit crunch has really taken the pizzazz out of the ‘p’ in private equity.

Check Out Line: International strength pretties up Avon profit

July 30, 2008

lips1.jpgCheck out how international sales and the weak dollar continue to lift quarterly results at U.S. companies.

Refried Beans

July 30, 2008

Organic vegetables are shown at a Whole Foods Market in LaJolla , CaliforniaA U.S. appeals court decision to revive antitrust proceedings against Whole Foods Market‘s takeover of rival Wild Oats may be too little too late to resurrect the organic market, but that might not be the point. S&P points out that Wild Oats is being quickly digested. The appeals court rejected Whole Foods’ argument that the FTC appeal is irrelevant because the agency does not have the authority to undo a completed merger. Federal courts “have the power to grant relief on the FTC’s complaint, despite the merger’s having taken place, …” the court said. Howard University law professor Andrew Gavil said the ruling could be important for the FTC as it sets a precedent strengthening the agency’s hand in seeking a preliminary injunction in future cases. The reversal drew a sharp dissent from one of the three judges on the panel, Appeals Court Judge Brett Kavanaugh, who accused his colleagues of trying to “unring the bell.”

The SENSEX – the low

July 30, 2008

image007.gifSince the somewhat manic reaction to the government’s confidence vote victory, the SENSEX has retraced fully under the weight of falling overseas markets and the Reserve Bank of India’s latest monetary tightening.
From a technical point of view on the daily chart we have settled around support at 14,206 on Wednesday.
Nevertheless the short-term indicators are still bullish with the Parabolic-SAR and MACD pointing to the upside.
The black right pointing arrows on the chart mark where we got good technical signals for medium term trend movements. The upward pointing arrow is the possible signal we are getting now about the current possible turning point.
The Alpha-Beta study has turned neutral but has yet to confirm an uptrend. This is the green line (signal line) on the chart which is current between the upper and lower lines. Confirmation of a new trend will come when the A-B turns bullish and that will be when the signal line cuts down through the lower line.
image0093.gifOn this chart you can see the major technical support at the long-term trendline in Q1-Q2 and when that broke around the 38.2 pct Fibonacci retracement level in Q2. You can see both these supports clearly on the chart.
Since the 38.2 pct support broke the next big level on the downside is 11,900 which is a 50 pct retracement of the entire low to high BSE upmove. As you can see we have bounced off good support around 12,500 which was the high reached before the 2006 sell-off and the 2007 low.
There is very good long-term technical support for this market between 11,900 and 12,500.
The bounce we had from 12,500 was clearly too steep as you can see and the market is currently settling into a more sustainable trend. We need to be looking for more technical confirmation that this was indeed the bottom of this year’s decline. All things considered, as long as the oil price continues to moderate, inflation doesn’t roar away and the political backdrop remains more positive we could have seen the trough everyone has been looking for.