Updated with trade deficit data.
NEW YORK (
) -- Here are the top stock market headlines for the morning of Friday, Oct. 9, 2009.
Friday's Early Headlines
- Trade Deficit Unexpectedly Contracts in August -- The Census Bureau said the trade deficit shrank to $30.7 billion in August from a revised $31.9 billion in July. Economists polled by Reuters had expected the trade deficit to swell to $32.9 billion.
- Fed Will Be Ready to Raise Rates: Bernanke -- Federal Reserve Chairman Ben Bernanke said the central bank will need to tighten monetary policy at some point to prevent the emergence of inflation, although the Fed is in no hurry. In prepared remarks that Bernanke delivered at a Fed conference Thursday, he said "accommodative policies will likely be warranted for an extended period," but as the economic recovery takes root, "we will need to tighten monetary policy to prevent the emergence of an inflation problem down the road."
- Fed Testing Reverse Repos - The Financial Times reports that the Fed has begun conducting small-scale tests of "reverse repos" trades that would enable the central bank to drain cash from the financial system once it decides to roll back its monetary policy. In a reverse repo, the Fed sells assets such as Treasury securities to dealers for cash with an agreement to buy them back at a slightly higher price at a later date, the report said. As part of the process, bank reserves are drained from the financial system.
- FDIC Questions Citi Management Review: Report -- The Wall Street Journal reports that the Federal Deposit Insurance Corp. is questioning a favorable review of Citigroup's (C) - Get Report management, conducted by an outside appraiser Egon Zehnder International. The review gave strong overall marks to Citigroup's management team and to CEO Vikram Pandit in particular, according to reports. Some officials at the agency have expressed doubts about the rigor of the report, which was based partly on interviews of Citi executives who were asked to rate the effectiveness of their colleagues, the report said, citing people familiar with the situation.
- GM to Seal Hummer Deal with Chinese Company -- General Motors could seal the deal to sell its Hummer brand to China's Tengzhong Heavy Industrial Machinery for $150 million on Friday, The Wall Street Journal reports. However, there is a possibility that China's central government could still back out from the deal, being aware of Hummer's reputation for excess gas-guzzling.
- Vivendi Set to Sell NBCU Stake: Report -- The Wall Street Journal reports that Vivendi is planning to sell its 20% stake in NBC Universal this year, but sources close to the matter told the paper a final decision won't be made until mid-November and will depend largely on whether the company can get a good price for the deal. Vivendi's consideration of a sale comes as General Electric (GE) - Get Report, the owner of NBC Universal, and cable company Comcast (CMCSA) - Get Report are discussing a deal to merge NBC Universal and Comcast's TV networks which would be possible only if Vivendi decides to sell.
- Obama Wins Nobel Peace Prize -- President Barack Obama has been given the 2009 Nobel Peace Prize, the third sitting U.S. president to win the award. The five-member Nobel committee said Obama was awarded the prize for "his extraordinary efforts to strengthen international diplomacy and co-operation between peoples."
Friday's Earnings Roundup
- Infosys (INFY) - Get Report said second-quarter net income fell 0.9% to $317 million based on international accounting standards, beating its own forecast. Revenue in the quarter fell 5.1% to $1.15 billion. Infosys did raise its fiscal-year revenue forecast, saying it expects revenue for the fiscal year of $4.6 billion to $4.62 billion, about 1% less than last year, but ahead of a forecast it made over the summer.