For at least the next couple months, we are going to have to get used to hearing companies announce job layoffs and earnings reductions.
1) Commodity producer Rio Tinto up 20 percent pre-open, laying off 14,000 globally, reducing capital expenditures, and revise production expectations for copper, iron ore and aluminum downward.
Other commodity stocks are up as well as commodities are up 2 to 4 percent this morning.
2) Praxair , the largest producer of industrial gases, is cutting 1,600 jobs and reducing its earnings guidance due to a drop in demand.
3) Kodakdown 16 percent pre-open; has withdrawn its second-half and full year 2008 guidance, but did not provide a revised forecast. They will update their guidance when they report fourth quarter earnings on January 29th.
1) Not great news on the mortgage front: the ABA said 30-year mortgages rates fell to 5.45 percent, down 2 basis points from last week (that's good news), but the big boost in purchases applications that we saw last week has largely dissipated. Purchases fell by 17.4 percent after gaining 38 percent. This will create debate that it is not the cost of money that is the issue, but there is either: 1) less willingness to buy regardless of the cost, or 2) lending standards are making it difficult to get loans. Refis, at least, were down only 0.9 percent after a 203 percent gain.
- US Mortgage Applications Dip after Big Surge
2) The $15 billion loan (bailout, whatever) that the automakers are getting makes one thing clear: forget about developing fuel-efficient vehicles, at least for this round. The money will be used to just to keep them afloat, and the whole issue of radically redesigning vehicle platforms and improving energy efficiency is not even on the table. Yet.
3) Remember a couple weeks ago when there was a riot after toy workers in China had been laid off? China exports dropped 2.2 percent in November from a year earlier, the first monthly decline since June 20.
- Whitney: Banks On Life Support Next 18 Months
- US Job Losses May Exceed Already Gloomy Forecasts
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