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1013 ET 19June2009-Barclays: Put spreads look attractive for rails
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Cheap volatility along with a rich skew makes put spreads attractive to
capture short-term weakness in railroad stocks Union Pacific Corp (UNP.N) and
Norfolk Southern Corp (NSC.N), a team of Barclays Capital analysts said in a
note this week. Union Pacific and Norfolk are among the handful of stocks in
the S&P 500 where the three-month implied volatility is trading at a discount
to the realized volatility, they said. They recommend buying the UNP August
$44-$49 put spread for a cost of $1.70 and purchasing the NSC September $31-$36
put spread for a net payment of $1.60. "Rail stocks remain more than 40 percent
below their high in July 2008," the note said. The Barclays air freight and
ground transportation analyst believes the acceleration of volume weakness will
likely present another significant earnings challenge for the stocks next
quarter. The analyst expects earnings to come in below consensus estimates and
sees the biggest miss potential in these two stocks for the second half of this
year.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
0959 ET 19June2009-Apple's new iPhone hits stores
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The newest version of Apple Inc (AAPL.O) iPhone went on sale on Friday,
while investors also await the presumed re-emergence of Steve Jobs, the
company's chief executive.
Jobs has been on medical leave for about six months.
The new version of Apple's popular smartphone features a faster processor,
video capability, an improved camera and better battery life. [ID:nN18225640]
Separately, an analyst at Merrill Lynch said China Unicom Ltd (0762.HK) may
be close to a deal to become the exclusive seller of the iPhone in China for
two years. [ID:nHKG71823]
Shares of Apple rose 1.8 percent to $138.43.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
0953 ET 19June2009-China fund to invest $500 mln in Blackstone fund: WSJ
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Chinese sovereign wealth fund China Investment Corp (CIC) is poised to put
$500 million into a Blackstone Group LP (BX.N) fund, according to a report in
the Wall Street Journal.
The move would come as CIC Chairman Lou Jiwei worries about missing
investment opportunities as the market nears a bottom, the paper reported,
citing unnamed sources.
For details, see [ID:nN19437991]
Shares of Blackstone gained 2.2 percent to $11.40 on Friday.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
0944 ET 19June2009-Barclays suggests sell strangle options in telecoms
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Selling strangle options in U.S. wireless carriers Verizon Communications
Inc (VZ.N) and AT&T Inc (T.N) are attractive to capture the view that these
stocks will remain rangebound, said a team of Barclays Capital analysts in a
note this week. The Verizon October $27.50-$32.50 strangle can be sold for
$2.13, with a breakeven of $25.37-$34.63 at expiration. The AT&T October
$22-$26 strangle can be sold for a net premium of $1.90. Investors who are long
these stocks may also consider writing calls to take advantage of the
relatively cheap skew and rich volatility, they said. Verizon October $31 calls
can be written for $1.22; AT&T October $26 can be sold for 80 cents. Barclays
said telecom stocks have underperformed year-to-date after leading the S&P 500
since the end of 2005. Barclays telecom analysts believes that as a late-stage
cyclic sector, growth in many of the companies will be subdued versus more
cyclically exposed names.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
0930 ET 19June2009-Markets open higher on economic optimism
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Major U.S. indexes opened higher on Friday, as a recent spate of improving
economic data beckoned investors back into equity markets for a second day.
The International Monetary Fund underscored the sense of improving
fundamentals after First Deputy Managing Director John Lipsky said the fund may
lift its 2010 growth forecast for the world economy amid signs of moderation in
the rate of decline in global output.
The Dow Jones industrial average .DJI rose 0.3 percent to 8,580.54 while
the S&P 500 .SPX gained 0.4 percent to 922.04, and the Nasdaq .IXIC was up
1 percent to 1,825.32.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
0914 ET 19June2009-Bailiffs order sale of stake in Vimpelcom
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Russia's bailiffs service said on Friday it had passed an order to auction
off Telenor's (TEL.OL) shares in mobile firm Vimpelcom (VIP.N) to cover a $1.7
billion fine for holding back Vimpelcom's entry into Ukraine.
"At the moment the sides ... are being notified of a decision to hand over
the shares to the Federal State Property Agency to be put up for sale in strict
accordance with the legislation," the service said on its website.
For details, see [ID:nLJ385090]
Shares of Vimpelcom rose 30 cents to $11.63.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
0910 ET 19June2009-NYSE Euronext to buy stake in Qatar exchange
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NYSE Euronext (NYX.N), owner of the New York Stock Exchange, will take a 20
percent stake in the newly created Qatar Exchange for $200 million. Qatar will
own the rest of the exchange.
For details, see [ID:nN19435883]
Shares rose 0.3 percent to $28.15.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
