Month: December 2011

 

Dear Friends,

“Follow your dreams…They know the way…”

-Kobi Yamada

Photos of the Day:

 December 7, 2011

 

Lightning Flashes in Chile above a volcano, in this June 5^th Reuters Photo of The Year entry for 2011. (Reuters)

People participate in an early-morning Yoga session in Chandigarh India. (Reuters)

Market Commentary

 

Canada

By Matt Walcoff

 Dec. 7 (Bloomberg) — Canadian stocks rose, led by banks, on speculation the Group of 20, International Monetary Fund and European Central Bank may take measures to alleviate the European debt crisis.

Bank of Nova Scotia, Canada’s third-largest lender by assets, gained 2.3 percent after an analyst at Royal Bank of Canada boosted his rating on the shares. Enbridge Inc., the country’s biggest pipeline company, increased 2.5 percent after releasing plans for its Seaway pipeline. Canadian Oil Sands Ltd., the largest owner of the Syncrude project, fell 4 percent after saying it may have to shut down an oil-sands upgrader for maintenance. The Standard & Poor’s/TSX Composite Index advanced 67.48 points, or 0.6 percent, to 12,148.73 a day before a meeting of European Union leaders.

 “Everyone is waiting and holding their breath to see what happens in Europe,” David Cockfield, a money manager at Northland Wealth Management in Toronto, said in a telephone interview. The firm oversees about C$200 million ($198 million). “The great hope is with France and Germany more or less on the same page, with a little strong-arming they can bring the rest of the group in line and at least give some indication of a joint front to meet some of these problems.”

Like every other developed-market benchmark stock index besides the S&P 500, the S&P/TSX has fallen this year on concern the European debt crisis may weaken the global economy. The Canadian gauge dropped 10 percent this year through yesterday after advancing seven of the previous eight years. The S&P/TSX Banks Index gained after three euro-region officials with knowledge of the discussions said the European Central Bank may announce measures to stimulate bank lending tomorrow. The officials spoke on condition of anonymity because the deliberations are private.

 Stocks extended their rally after Nikkei reported the G-20 is considering establishing a $600 billion IMF lending program for Europe. Shortly before markets closed, CNBC said the IMF denied the report. Royal Bank, Canada’s largest lender by assets, advanced 2.2 percent to C$49.56. Toronto-Dominion Bank, its biggest domestic competitor, increased 1.3 percent to C$73.85. Scotiabank climbed 2.3 percent to C$49.03 after Andre- Philippe Hardy, an analyst at Royal Bank, raised his rating on the shares to “outperform” from “sector perform.” Hardy cited “Scotiabank’s consistent strategy and execution, the greater growth potential of its international banking arm versus purely North American banking franchises, and the improved wealth management platform” in a note to clients.

 Enbridge rallied 2.5 percent to C$35.80, the first advance in a week, after forecasting capacity of 375,000 barrels of oil a day for its Seaway pipeline in 2013. Enbridge is reversing the pipeline’s flow to run from Cushing, Oklahoma, to Houston-area refineries. Canadian Oil Sands dropped 4 percent to C$20.35. The company may it may shut down its oil-sands upgrader for maintenance if it can’t return to full production rates after a disruption last month.EnCana Corp., Canada’s largest natural gas producer, rose 1.7 percent to C$20.48 after agreeing to sell two processing plants to Veresen Inc. for C$920 million.

Petrominerales Ltd., an energy producer with operations in Colombia, fell 5.9 percent to C$16.10 after sinking 16 percent yesterday. Ian W. Macqueen, an analyst at Canadian Imperial Bank of Commerce, cut his rating on the stock to “sector perform” from “sector outperform” a day after Petrominerales said it suspended drilling at two wells.

 Among other S&P/TSX energy companies, Imperial Oil Ltd., the country’s second-biggest company in the industry, gained 3 percent to C$44.50. Cenovus Energy Inc., the fifth-largest, advanced 2.5 percent to C$33.89. Great Basin Gold Ltd. advanced 16 percent, the most since February 2009, to C$1.21. The prospector with operations in South Africa and Nevada said it executed a $150 million loan agreement. Gold producer Jaguar Mining Inc. had the largest decline in the Canadian stock benchmark index, falling 9.2 percent to C$6.62, after saying Chief Executive Officer Daniel Titcomb left the company.

 US

 Dec. 7 (Bloomberg) — U.S. stocks rose, sending the Dow Jones Industrial Average to the highest level since October, amid optimism that European leaders will announce greater efforts to halt the debt crisis at a summit this week.

Treasuries gained, commodities fell and the euro fluctuated. The Dow rose 46.24 points, or 0.4 percent, to close at 12,196.37 and the Standard & Poor’s 500 Index advanced 0.2 percent at 4 p.m. New York time. The euro was little changed at $1.3412, recovering from a loss of as much as 0.4 percent. Ten- year Treasury yields decreased for the first time this week, losing six basis points to 2.03 percent. The S&P GSCI Index of commodities slumped 0.9 percent as sugar, coffee, gasoline and wheat lost more than 2 percent. The S&P 500 erased an earlier loss in the final hour of trading after Nikkei reported that the Group of 20 nations is considering a $600 billion International Monetary Fund lending program to supplement Europe’s efforts to tame the sovereign- debt crisis. Stocks trimmed gains in the final minutes as CNBC said the IMF denied the report.

 “It’s difficult to get a bottom line outcome on the European situation,” Philip Dow, director of equity strategy at Minneapolis-based RBC Wealth Management which oversees about $160 billion, said in a telephone interview. “Macro concerns are driving the market,” he said. “It’s a challenging environment to manage money.”  Financial shares in the S&P 500 rose 1.2 percent as a group, leading gains among seven of the 10 main industry groups.

JPMorgan Chase & Co. climbed 2.3 percent after Chief Executive Officer Jamie Dimon said the company can buy back $1 billion or more in stock, adding that the bank may or may not repurchase more shares. JPMorgan led the Dow’s advance, followed by gains of at least 1.2 percent in Bank of America Corp., Johnson & Johnson, Cisco Systems Inc. and American Express Co. The S&P 500 extended its gain for the year to 0.3 percent

and the Dow is up 5.4 percent in 2011. Pressure on Europe’s leaders to halt the spread of the region’s debt crisis at a summit starting tomorrow intensified as the EU had its AAA long-term rating put on “creditwatch negative” by S&P following a similar action on 15 of the 17 euro governments. The action “does not have any impact on the sovereign credit ratings on non- eurozone members of the European Union,” John Piecuch, director of communications at S&P, said in an e-mail. Deutsche Bank AG and BNP Paribas SA were among European lenders that also were given a negative outlook by S&P.

 The Stoxx Europe 600 Index slipped 0.2 percent. Banca Monte dei Paschi di Siena SpA, Italy’s third-biggest bank, led a drop among lenders. ING Groep NV fell 4.7 percent after saying it plans to take a charge related to its U.S. annuity business. European stocks gained earlier after the Financial Times reported yesterday that officials were negotiating a bigger rescue effort to discuss at the European summit, including running both temporary and permanent rescue funds in tandem.

Gains evaporated after Germany rejected combining the current and permanent euro-area rescue funds and expressed pessimism over the outcome of this week’s summit. Three euro-area officials with knowledge of policy makers’ deliberations said the European Central Bank may announce a range of measures tomorrow to fight the crisis. Options for the ECB include loosening collateral criteria so that institutions have more access to cheap ECB cash and offering them longer-term loans, said the officials, who spoke on condition of anonymity because the discussions are private.

 After U.S. financial markets closed, Canadian Finance Minister Jim Flaherty said today there has not been discussion among the Group of 20 nations on a $600 billion plan to boost lending to the IMF. He reiterated that Canada opposed the idea of the IMF leading a loan package for Europe and said the region’ s governments should solve the problem internally.

The euro depreciated against 11 of its 16 major peers, while the dollar weakened against 13.  Most international investors predict at least one nation will eventually dump the euro and they say greater fiscal ties or a smaller currency area are the best fixes for the region’s debt crisis, according to the quarterly Bloomberg Global Poll. Almost half the respondents in the poll say one or more countries will leave the 17-nation bloc within a year and almost a third more predict an exit by the end of 2016. Never before has the euro influenced U.S. stocks as much as this year, a sign that American equities aren’t going anywhere until Europe’s crisis is solved. The link between the Dow average and swings in the currency reached a record on Dec. 2, according to data compiled by Bloomberg. The so-called correlation coefficient showing how much two markets rise and fall in tandem hit 0.85, the highest level since the euro was founded in 1999, data on 60-day rolling averages show. A reading of 1 means assets are moving in lockstep.

 Have a wonderful evening everyone!

As Always,

 

Kyle for Carolann.

 

Dear Friends,

Tangents:

 

Lord Byron, Journal, December 6^th, 1813.

Awoke, up an hour before being called; but dawdled three hours in dressing.  When one subtracts from life infancy (which is vegetation), sleep, eating, and willing – buttoning and unbuttoning – how much remains of downright existence?  The summer of a dormouse.

Birthdays:

Ira Gershwin, lyricist, b. 1896

Old Man Sunshine – Listen, you!
Never tell me Dreams Come True!
Just try it –
And I’ll start a riot.
Beatrice Fairfax – don’t you dare
Ever tell me he will care;
I’m certain
It’s the Final Curtain.
I never want to hear
From any cheer-
Ful Polyannas,
Who tell you Fate
Supplies a Mate –
It’s all bananas!
They’re writing songs of love,
But not for me;
A lucky star’s above,
But not for me.
With Love to Lead the Way,
I’ve found more Clouds of Gray
Than any Russian play
could guarantee…

        -Gershwin, 1930
Alfred Eisenstaedt, photographer, b. 1898

Market Commentary:

Canada

By Matt Walcoff

Dec. 6 (Bloomberg) — Canadian stocks fell for the third time in four days, led by financial companies, after Bank of Montreal reported fourth-quarter earnings that missed the average analyst estimate in a Bloomberg survey.

BMO, Canada’s fourth-biggest lender by assets, lost 3.5 percent after its profit excluding certain items missed the average estimate by 3.4 percent. Copper producer Quadra FNX Mining Ltd. soared 40 percent after agreeing to be bought by KGHM Polska Miedz SA. Petrominerales Ltd., which produces oil and gas in Colombia, plunged 16 percent after halting some production.

The Standard & Poor’s/TSX Composite Index slipped 38.08 points, or 0.3 percent, to 12,081.25. “People are saying, ‘Where’s the significant growth going to come from for the Canadian banks?’” Anil Tahiliani, a money manager at McLean & Partners in Calgary, said in a telephone interview. The firm oversees about C$1 billion ($989 million). “It’s hard to say what’s going to drive the banks forward other than the global economic picture getting better.”

The S&P/TSX climbed 5.7 percent in the previous six days as central banks in Europe, Asia and North America cut lenders’ borrowing costs and Italy’s cabinet passed a package of spending cuts and tax increases. Canada’s benchmark stock gauge has fluctuated with developments in the European debt crisis this quarter, which has overshadowed growth in Canadian companies’ earnings.                    

The S&P/TSX Financials Index fell after Toronto-based BMO missed the analyst estimate for the first time in five quarters. Bank of Montreal slumped 3.5 percent to C$57.74. Royal Bank of Canada, the country’s biggest lender, slipped 1.5 percent to C$48.50. Regional lender Canadian Western Bank dropped 4.7 percent, the most since July 2009, to C$27.13 after Sumit Malhotra, an analyst at Macquarie Group Ltd., reduced his rating on the shares to “neutral” from “outperform.”

The U.S. Dollar Index declined and raw-materials companies rose after the Financial Times said the European Union was in talks to almost double its bailout fund. The newspaper cited unnamed European officials.

Potash Corp. of Saskatchewan Inc., the world’s biggest fertilizer producer by market value, increased 2.9 percent to C$43.90 as corn advanced for the first time in four days. Goldcorp Inc., the world’s second-largest gold producer by market value, climbed 1.4 percent to C$52.54 as the metal erased its losses in electronic trading.                        

Ivanhoe Mines Ltd., Rio Tinto Group’s partner in the Oyu Tolgoi copper mine in Mongolia, rose 5.1 percent to C$22.71 after Australia’s Business Spectator said Rio Tinto is “widely expected” to buy the shares of Ivanhoe it doesn’t already own. The website didn’t cite any sources. Luke Distelhorst, a spokesman for Ivanhoe, said the company has no comment on the report.

Quadra FNX, which operates in the U.S., Canada and Chile, jumped a record 40 percent to C$15.88 after saying Lubin, Poland-based KGHM, the biggest copper producer by European output, will buy it for C$15 a share in cash. The purchase would be the biggest acquisition of a Canadian base-metals company by price since Rio Tinto bought Alcan Inc. for $43 billion in 2007.

European Goldfields Ltd., which is developing mines in Greece and Romania, surged 22 percent, the most since December 2008, to C$12.12 after Sky News said Eldorado Gold Corp. has approached it about a potential takeover. The network didn’t say where it got its information. European Goldfields said in a statement it received “preliminary and indicative approaches from third parties” regarding potential deals.                   

Petrominerales plunged 16 percent, the most since September 2008, to C$17.10 after saying it has suspended some production until it improves water-disposal capacity. Pacific Rubiales Energy Corp., which also operates in the country, retreated 4.2 percent to C$20.27.

Athabasca Oil Sands Corp., PetroChina Co.’s partner in oil- sands development, rallied 6.1 percent to C$13.35. The companies may be close to receiving regulatory approval for the MacKay project, Jeff Martin, an analyst at Peters & Co. in Calgary, said in an e-mail message.

Yoga-wear retailer Lululemon Athletica Inc. slumped 6.5 percent to C$45.98 after Taposh Bari, an analyst at Jefferies & Co., reduced his 12-month share-price estimate to $54 from $59. Bari cut his 2012 profit forecasts after the Vancouver-based company reported sales that missed the average analyst estimate in a Bloomberg survey last week.

Canadian National Railway Co., the country’s largest railroad, slipped 1.8 percent to C$78.39 after Gary Chase, an analyst at Barclays Plc, cut his rating on the shares to “underweight” from “equal weight.” CN is more-expensive relative to forecast earnings for 2012 than other North American railroads, Chase wrote in a note to clients.

Capstone Infrastructure Corp., which owns stakes in alternative-energy power plants, sank 37 percent to a record-low C$3.54 after cutting its earnings forecast and saying it may reduce its dividend.

Sandvine Corp. tumbled 35 percent, the most since March 2008, to C$1.20. The maker of hardware and software for Internet service providers said fourth-quarter revenue was C$19.5 million ($19.3 million) to C$20 million, compared with an average analyst estimate in a Bloomberg survey of C$29 million.

US

By Rita Nazareth

Dec. 6 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index higher a second day, on speculation European leaders may act to contain the debt crisis after S&P put 15 euro nations on review for possible downgrade.

3M Co. added 1.5 percent as revenue may increase as much as 6 percent next year amid a boost from acquisitions. General Electric Co. rose 2.4 percent as Sanford C. Bernstein & Co. raised its recommendation. Darden Restaurants Inc., operator of the Red Lobster chain, tumbled 12 percent after cutting its full-year sales and profit growth forecasts.

The S&P 500 advanced 0.1 percent to 1,258.47 at 4 p.m. New York time, rebounding from an earlier drop of 0.3 percent. The Dow Jones Industrial Average added 52.30 points, or 0.4 percent, to 12,150.13. About 6.3 billion shares changed hands on U.S. exchanges, or 19 percent below the three-month average.

“The market wants to go higher,” Dan Veru, chief investment officer at Fort Lee, New Jersey-based Palisade Capital Management LLC, which manages $3.4 billion, said in a telephone interview. “Europe is finally talking on a constructive manner to solving its problems. If they come up with something that’s credible, this market has another 7 percent to 10 percent to the upside.”

German Finance Minister Wolfgang Schaeuble said S&P’s warning will help force European leaders to ratchet up efforts to resolve the crisis. S&P said today the European Financial Stability Facility may lose its top credit rating if any of its guarantors have their own debt grade cut.

Stocks turned higher in the afternoon as the Financial Times reported that officials are negotiating a bigger rescue effort to discuss at this week’s European Union summit, including running two separate bailout funds simultaneously. Bloomberg News reported discussions about the combination of the temporary and permanent rescue funds on Oct. 20.

“Europe is going to be an ongoing story,” Thomas Garcia, head of equity trading at Santa Fe, New Mexico-based Thornburg Investment Management Inc., which oversees about $75 billion, said in a telephone interview. “It seems like every day they’ve got a new solution of the problem. I hear at least one new story of a bailout package every day. Is this really what’s going to bail them out?”

3M rallied 1.5 percent to $82.13. Sales may be $30.2 billion to $31.5 billion, according to a presentation on the company’s website, in line with the $30.6 billion average estimate from analysts surveyed by Bloomberg. The maker of Scotch-Brite sponges and Nexcare thermometers expects earnings per share of $6.25 to $6.50 next year, also tracking estimates.                          

GE added 2.4 percent to $16.72. Sanford C. Bernstein raised its recommendation for the Fairfield, Connecticut-based company to “outperform” from “market perform,” citing rising dividends and energy orders starting in 2012. Eli Lilly & Co. advanced 3.9 percent to $38.86, the highest price since Nov. 8. Shares of the drugmaker could rise more than 50 percent should its drug for Alzheimer’s disease succeed, Sanford C. Bernstein said in a note to clients.

A gauge of 12 homebuilders in S&P indexes rallied 1.2 percent. Toll Brothers Inc. gained 2.7 percent to $21.30. The largest U.S. luxury-home builder reported earnings that beat analysts’ estimates as prices rose and sales improved at its East Coast communities. MetroPCS Communications Inc. added 7.8 percent to $9 for the biggest gain in the S&P 500. The pay-as-you-go U.S. wireless carrier was raised to “outperform” from “market perform” at William Blair & Co., which said the stock’s price doesn’t reflect the company’s “healthy balance sheet.”                      

Darden fell 12 percent, the most in three years, to $41.82. The restaurant operator said sales and profit this year will grow more slowly than previously forecast as the company works to revive its Olive Garden chain.

A measure of transportation shares had the biggest decline in the S&P 500 among 24 industries, falling 0.8 percent. Union Pacific Corp. lost 1.7 percent to $102.84. Laszlo Birinyi says he knew it would be hard to make predictions for 2012 in October, when he saw a headline suggesting that markets would rise or fall depending on whether the tiny nation of Slovakia approved a bailout plan for Europe.

Birinyi, president of stock market research and money- management firm Birinyi Associates Inc., says markets are so volatile that it doesn’t take much to send them reeling, reports Bloomberg Markets magazine in its January issue.

“There are so many exogenous factors that to try to forecast the market with a degree of confidence is difficult,” Birinyi says. The best strategy for stock investors, he says, is to stick with iconic brands, such as Apple Inc. or Ralph Lauren Corp., and with companies that offer “meaningful dividends” of at least 5 percent.

 Have a wonderful evening everyone.

Be magnificent!

The whole universe is to us a writing of the Infinite in the language of the finite.

-Swami Vivekananda, 1863-1902

As ever,

Carolann

If you think you can, you can.  And if

you think you can’t, you’re right.

             -Mary Kay Ash, 1918-2001 

 

Dear Friends,

Tangents:

On this day,

Actor, filmmaker, Woody Allen, was born in 1935:

How to make God laugh: Tell him your future plans. ~Woody Allen.

1891: Basketball created.

1955: Rosa Parks was arrested.

I dwell in Possibility-

A fairer House than Prose-

More numerous of Windows-

Superior – for Doors –

 

Of Chambers as the Cedars-

Impregnable of Eye-

And for an Everlasting Roof-

The Gambrels of the Sky-

 

Of Visitors – the fairest-

For Occupation – This –

The spreading wide my narrow Hands-

To gather Paradise-

     -Emily Dickinson

Photo of the Day 

A member of dancer-illusionists company Momix performs during a press rehearsal of its latest show called ‘reMIX’ in Madrid. Sergio Perez/Reuters.

Market Commentary:

Canada

By Kaitlyn Kiernan

Dec. 1 (Bloomberg) — Canadian stocks fell for the first time in four days, led by banks and commodity producers, as a contraction in Chinese manufacturing and an increase in U.S. jobless claims revived concern that growth will slow.

Gildan Activewear Inc. lost 33 percent, the most in the benchmark equity index, after forecasting a quarterly loss. Bank of Nova Scotia, Canada’s third-biggest lender by assets, fell 2.5 percent. First Quantum Minerals Ltd., the country’s second- largest publicly traded copper producer, erased 3.1 percent. The Standard & Poor’s/TSX Composite Index fell 90.82 points, or 0.7 percent, to 12,113.29.

“We had a very impressive rally yesterday, so it’s not unexpected that the market is off ever so slightly today,” Jennifer Radman, a money manager at Caldwell Investment Management Ltd. in Toronto, said in a telephone interview. The firm oversees about C$1 billion ($982 million). “Everyone has to digest a little bit the actions taken by the central banks, because it was very similar to the announcements made in the fall of 2008, and we all know what happened in the markets at that point.”

The S&P/TSX rallied 4 percent in the biggest one-day gain since March 2009 yesterday after central banks in Europe, Asia and North America cut lenders’ borrowing costs to bolster the financial system. The S&P/TSX fell 17 percent in October 2008 after the U.S. Federal Reserve cut the Fed Funds Target rate to 1 percent from 2 percent.                    

A purchasing managers’ index compiled by the China Federation of Logistics and Purchasing slid to 49 in November, lower than all but two of 18 forecasts in a Bloomberg News survey. Readings below 50 signal a contraction.

U.S. jobless claims climbed by 6,000 to 402,000 in the week ended Nov. 26 that included the American Thanksgiving holiday, Labor Department figures showed today in Washington. The median forecast of 43 economists in a Bloomberg News survey called for a drop to 390,000.

Gildan Activewear dropped 33 percent, the most in a day since 2008, to C$16.54. The company forecast a loss in the first quarter of 40 cents a share, citing high cotton prices, distributor destocking and discounting.                      

Lululemon Athletica Inc. slumped 5.7 percent, the most since Oct. 3, to C$47.88. The yoga-wear retailer reported third- quarter sales that trailed analysts’ estimates. Revenue increased 31 percent to $230.2 million, missing the average analyst estimate of $235.3 million.

Magna International Inc., Canada’s largest auto-parts maker, fell 2.2 percent to C$35.60.

Banks fell for the first time in four days even after Toronto-Dominion Bank and Canadian Imperial Bank of Commerce reported quarterly results that beat analyst estimates.

Toronto-Dominion, country’s second-largest lender by assets, fell 1.5 percent to C$71.90. The bank said fourth- quarter profit rose 58 percent to C$1.57 billion ($1.54 billion), or C$1.69 a share. Earnings excluding some items of C$1.77 a share exceeded the average analyst estimate of C$1.55 a share.

CIBC, the country’s fifth-largest lender, declined 1.3 percent to C$72, after its earnings excluding some items beat the average analyst estimate by 3.5 percent. Bank of Nova Scotia lost 2.5 percent to C$50.24. Royal Bank of Canada, the country’s largest lender, declined 0.5 percent to C$47.03.

Mining companies slumped as gold erased earlier gains and as copper dropped. Barrick Gold Corp., the largest producer of the precious metal, slipped 1.3 percent to C$53.38. Goldcorp Inc., the world’s second-largest gold producer by market value, fell 1.2 percent to C$54.32. First Quantum erased 3.1 percent to C$19.96.

US

By Rita Nazareth

Dec. 1 (Bloomberg) — U.S. stocks declined as better-than- forecast manufacturing growth and a rally in French and Spanish bonds were not enough to extend the biggest three-day gain in the Standard & Poor’s 500 Index since March 2009.

Financial stocks fell the most in the S&P 500 among 10 industries, dropping 1 percent, as Massachusetts sued some of the largest lenders over foreclosure practices. Alcoa Inc. lost 2.1 percent as commodities retreated. Kohl’s Corp. slumped 6.4 percent after November sales missed estimates. Yahoo! Inc. advanced 3.3 percent as a group including Alibaba Group Holding Ltd. was said to prepare a bid for the company.

The S&P 500 slid 0.2 percent to 1,244.58 at 4 p.m. New York time. The index rallied 4.3 percent yesterday as six central banks took action on Europe’s debt crisis by making it cheaper for lenders to borrow in dollars. The Dow Jones Industrial Average decreased 25.65 points, or 0.2 percent, to 12,020.03. Trading volume on U.S. exchanges dropped to about 6.8 billion shares, or 16 percent below the three-month average.

“Pressures on the financials are still out there,” Timothy Ghriskey, who oversees $2 billion as chief investment officer of Solaris Group LLC in Bedford Hills, New York, said in a telephone interview. “The economic data was positive, but Europe is still a concern. The coordinated central bank action is not a solution. It buys them some time.”

Stocks rose earlier today as Spain and France sold 8.1 billion euros ($10.9 billion) of bonds, sending yields lower across Europe. In the U.S., manufacturing expanded in November at the fastest pace in five months.                      

Equities reversed gains as JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. were among five banks sued by Massachusetts for allegedly conducting unlawful foreclosures and deceiving homeowners.

The KBW Bank Index lost 0.8 percent after yesterday’s 7.2 percent jump. JPMorgan decreased 1.7 percent to $30.46. Citigroup slipped 1.8 percent to $26.99. Bank of America added 1.7 percent to $5.53, reversing an earlier decline.

Gauges of commodity shares in the S&P 500 fell at least 0.6 percent after a contraction in China’s manufacturing fueled concern Europe’s crisis is damaging the global economy as yesterday’s moves by central banks were viewed as only a temporary fix. Alcoa, the largest U.S. aluminum producer, dropped 2.1 percent to $9.81.

Kohl’s fell the most in the S&P 500, erasing 6.4 percent to $50.37. The department-store chain said sales at stores open at least one year decreased 6.2 percent in November. Analysts on average estimated an increase of 2.1 percent.                      

Barnes & Noble Inc. plunged 16 percent, the most since Aug. 19, to $14.59. The largest U.S. bookstore chain reported second- quarter sales that missed the average analyst estimate by 4.3 percent, according to Bloomberg data.

Stocks pared declines in the afternoon as investors awaited tomorrow’s jobs report. Payrolls may have climbed by 125,000 workers in November, after rising 80,000 the prior month, economists surveyed by Bloomberg projected ahead of the Labor Department report.

“People are looking for catalysts,” Peter Jankovskis, who helps manage about $2.4 billion at Oakbrook Investments in Lisle, Illinois, said in a telephone interview. “One catalyst may be additional signs of strength in the U.S. You may have some people wanting to make sure that they are in because they are expecting a big number on the jobs front.”

Yahoo rallied 3.3 percent to $16.23. Alibaba Group and Softbank Corp. are in advanced talks with Blackstone Group LP and Bain Capital LLC about making a bid for all of Yahoo, said three people with knowledge of the matter.                          

A bid may value Yahoo at more than $20 a share because of tax savings tied to the Internet company’s stakes in Alibaba and Yahoo Japan, said two of the people, who declined to be identified.

 Clearwire Corp. rallied 14 percent to $2.03. The money- losing wireless carrier paid creditors $237 million in interest after striking a new network-sharing agreement with partner Sprint Nextel Corp.

The S&P 500 will end next year at 1,250 as a stagnating U.S. economy damps valuation increases for equities, Goldman Sachs Group Inc.’s David Kostin said.

The strategist lifted his estimate for earnings by companies in the benchmark measure to $100 a share in 2012 from $98, according to a note dated yesterday. He boosted his projection for combined profit this year by $1 to $97.

The S&P 500 declined 0.9 percent this year through yesterday amid concern European officials will fail to tame the region’s debt crisis, triggering a global recession. The gauge’s price-earnings multiple based on estimated profit for the next year has averaged 12.9 times this year and fell as low as 11 times on Oct. 3, according to data compiled by Bloomberg.

“The U.S. economy remains in stagnation,” Kostin said. “This fact will limit any significant rally or sustained P/E expansion in the S&P 500 in 2012. The high degree of political uncertainty coupled with downside policy tail risk drives our view that equity investors should focus on the underlying fundamentals and position portfolios for the worst while hoping for the best.”

Have a wonderful evening everyone.

Be magnificent!

Your reactions are shared by all humanity.

Your brain is not yours,

it has evolved through centuries of time.

So we are questioning deeply whether there is an

individual at all.  We are the whole of humanity,

we are the rest of mankind.

 

-Krishnamurti, 1895-1986

As ever,

Carolann

Everything that irritates us about others

can lead us to an understanding about

ourselves.

               -Carl Jung, 1875-1961