Weekley Market Re-Cap 11/26/2009

While Black Friday, by every early indication, had done everything asked of it — and more, it seemed, than pessimists had expected of it — it failed to wrest Wall Street’s post-holiday spotlight from a corporate debt crisis on the far side of the globe.

The Dubai World story had captivated and frustrated markets beginning late Wednesday, when U.A.E. city-state Dubai, the controlling stakeholder, raised a red flag by announcing — with, it should be noted, holidays looming in the Muslim world as well as in the U.S. — a restructuring of the flashy conglomerate and a six-month standstill on its debt.

An ultimate default, of course, is the market’s chief fear, with banks around the world suffering severe collateral damage.

It was, as MarketWatch assistant managing editor Tom Bemis wrote, an important real-world stress test of the global financial system — a test whose results, so far, are mixed, with most European markets recovering from Thursday’s drubbings in Friday action but U.S. stocks only managing to salve Friday’s deepest wounds.

Friday’s declines left the main U.S. stock gauges in the red for the week — the Dow (DJIA) and Nasdaq (COMP) by 0.1% and the S&P 500 (SPX) by a razor-thin 0.01%.

As always I welcome your thoughts and would be more than happy to talk with you regarding any questions or concerns you may have. Please feel free to contact me at 949-209-9441, or matt@mktwealthmanagement.com.  

Best regards,

 Matthew Todsen President / CEO MKT Wealth Management Top 10 Stories of the Week Provided by MarketWatch A big Black Friday

The indications were almost uniformly upbeat Friday as the holiday shopping season got underway. Five thousand customers outside Macy’s in Manhattan before the doors opened at the crack of dawn. Five hundred free breakfasts snapped up in 20 minutes at a Florida shopping center. Long lines at Best Buy stores in various geographies. Conspicuous consumption at the Garden State Mall in New Jersey. Shoppers in the nation’s capital paying surrogates $20 to endure out-the-door lines in their stead. See full story on retail’s Black Friday.

A Dubai World of hurt?

U.S. banks are likely less exposed than their European counterparts to a potential debt default by Dubai World, but a lack of transparency and the interconnectedness of the modern financial system make it difficult to know which institutions are ultimately exposed, analysts said Friday. See full story on the banking industry’s potential exposure to Dubai World’s debt crisis.

The new gold bugs

Gold has long been favored by a fringe of the investment world. This year, however, some of the world’s leading hedge-fund managers have loaded up on the precious metal. Some are concerned that government efforts to avoid another Great Depression could undermine major currencies and fuel rampant inflation. Find out more about the latest generation of gold bugs.

Surge in home sales

Sales of new homes rose 6.2% in October, boosted by strong results in the South, according to the latest data from the Commerce Department. The seasonally adjusted annual rate of 430,000 was well above the 390,000 pace that economists surveyed by MarketWatch had expected. Read more about the latest housing data .

China’s data ‘disconnect’

A sharp rise in Chinese car sales and vehicle ownership hasn’t been reflected in nationwide gasoline consumption this year, an anomaly that has some analysts scratching their heads in search of answers. The disconnect has sparked a range of possible explanations — and some suspicious musings. Read more about China’s car sales .

Profits rise at H-P

Hewlett-Packard (HPQ) reported a 14% gain in quarterly profit, despite a dip in sales, as the Silicon Valley behemoth reeled from lower revenue in its key PC and printer segments. But the Palo Alto, Calif.-based company also posted a higher revenue for its information-technology services business, underscoring H-P’s transformation from a traditional hardware maker. Read more about H-P’s results .

Troubles in Saab deal

Swedish carmaker Koenigsegg backed out of its deal to buy Saab from General Motors, leaving the Detroit giant with another European name plate it had initially planned on selling. GM and Koenigsegg reached a binding agreement on the cash-bleeding Saab brand back in August, two months after the two automakers signed a letter of intent. Read more about the Saab deal .

With age comes wisdom

Hunting for a job is never easy, particularly in labor markets like this one, but it can be even harder when your hair is going gray. Even if age bias were rare — and many say it’s not — after a rejection or three, it can become difficult to go to another job interview without the worrisome feeling that stereotypes are working against you. But that attitude may torpedo your chances of landing a job. Get some tips on finding that job .

Problem banks

The number of distressed banks in the U.S. rose to the highest level in 16 years in the third quarter, and the insurance fund used to protect bank depositors swung to a negative balance, according to a report released by the Federal Deposit Insurance Corp. The FDIC’s Deposit Insurance Fund, which is used to protect depositors, swung to an $8.2 billion loss in the third quarter, the largest drop since the savings-and-loan crisis of the 1990s. Read more about the troubled banks .

Calculating GDP growth

Spurred by government stimulus programs, the economy expanded at a 2.8% annualized rate in the third quarter, the Commerce Department reported. However, the 2.8% growth rate is below the government’s initial estimate of 3.5% due to downward revisions in consumer spending and business investment in nonresidential structures, as well as changes to imports and exports. Despite the downward revision, growth in the third quarter was the strongest in two years, the government said. Read more about the GDP data .

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