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Thursday, December 3, 2009

Morning Market Report

There's breaking economic data. First time jobless claims fell again and the latest number is at 457,000. It's the fifth straight week that this number has fallen and it will lead to an interesting monthly employment number for November tomorrow.

The number of U.S. workers filing new applications for jobless insurance unexpectedly fell last week to the lowest level in more than 14 months, government data showed on Thursday, pointing to a moderation in the pace of job losses.

Separately, non-farm productivity was slightly less robust than previously thought in the third quarter as workers earned more money and output rose at a slower pace, government data showed on Thursday.



Meanwhile, the European Central Bank held it's version of the Fed Funds Rate at its low of 1%.




The European Central Bank kept rates at a record low of 1 percent as expected on Thursday, leaving markets firmly focused on how it plans to handle the delicate process of phasing out its financial crisis support.

With markets still some way from normality, all 80 economists in the latest Reuters poll had predicted the rate decision. Currency and bond markets were little moved by the decision.




The equity markets have all but shrugged off news in Dubai for now. Futures are up this morning and all three indices are back to roughly the levels they were at before the news. In fact, the big financial news of this morning, domestically at least, is the consummation of the deal between Comcast and GE that will give Comcast controlling interest in NBC.




Comcast Corp. announced Thursday it plans to buy a majority stake in NBC Universal for $13.75 billion, giving the nation's largest cable TV operator control of the Peacock network, an array of cable channels and a major movie studio.

Although the deal could mean that movies could reach cable more quickly after showing in theaters, and that TV shows could appear faster on cell phones and other devices, it was already raising concerns that Comcast would wield too much power over entertainment.




Meanwhile, good news in equities has been bad news for bonds. After the ten year U.S. Treasury bond tested 3.20% earlier in the week, it's now back up to 3.38%. The yield spread between the two and ten year has increased to 2.61%. The three month treasuries are still positive, barely, paying .005%.



In the Far East, the Hang Seng is up 1.19% and the NIKKEI in Japan is up 3.84%. In Europe, the FTSE in London was up .1%, the DAX in Germany was up .38%, and the Spanish index was up .82%.



The Dollar is mixed this morning. It's down by .31% against the Euro, up by .17% against the British Pound, and up by 1.01% against the Japanese Yen.

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