Inventory of dive after that June dismal jobs report - BusinessWeek

By DANIEL WAGNER

Stocks are traded lower at noon after a dismal report on the work of stifled market hopes for an economic recovery fast.

The Ministry of labour, said only 18 000 jobs have been created in the United States last month, less than nine months. The full report hopes for a quick recovery after the economy collapsed this spring.

Traders sold stocks, erasing the gains of the week and in the relative safety of government bonds. Yield on the Treasury 10-year note fell to 3.02 percent of 3.19% before the publication of the jobs report.

Shortly before midday, the Dow Jones is down 109 or 0.9%, at 12,611. The & S P 500 is 15 or 1.1 percent, to 1,339. The Nasdaq has lost 30, or 1 percent, at 2,843.

Orders of China offshore oil risks review after spill (AP)

SHANGHAI - China Ocean administration ordered oil companies offshore well to assess the risk of accidents after two oil spills off its coast to is in a field operated by ConocoPhillips U.S. energy giant.

The Oceanic Administration issued a notice Friday saying producers of oil in the offshore must thoroughly investigate the risks, to review their emergency planning and also to re-evaluate the environmental impact of their operations.

Offshore operators should learn from the accident and thorough and deeply investigate the risk of spillage of oil and correct, "he says.

Oil spill, which covered 840 square kilometres (324 square miles) in the field of oil Penglai 19-3 in the Bohai Bay, drew criticism from environmentalists and local media on the potential for damage to the environment and the apparent delays is advising the public.

But China ConocoPhillips, which operates seven production platforms in the region of Penglai of Bohai, defended its response, saying: he responded quickly to these two leaks and informed the authorities the day, they were found.

Earlier this week, ConocoPhillips, based in Houston and its Chinese partner in the field, state-owned CNOOC Ltd., said two leaks ceased and cleaning work was almost finished.

The deadline to announce the details of the first flight, which was noted on June 4, was due in part to the difficulty of tracing the infiltration of natural fault, they said, noting that these leaks are rare and that he had not seen front of Bohai.

The Oceanic Administration ordered operators of offshore platform for assessing the risk of injection water in oil fields. The leaks last month took place during these works were underway.

ConocoPhillips said that it had suspended an injection of drilling and water until it completes its investigation and would change its operating practices to prevent the resurgence of a problem.

The State Oceanic Administration said 3,000-metre (3,300 yards) sea booms and other devices have been deployed to help clean up the spill.

The oil field of Penglai 19-3, more large field off the coast of China, has been developed jointly by ConocoPhillips China and CNOOC Ltd. U.S. partner has 49% of the field and its operator, while the Chinese partner has 51 percent.

The spill has raised concerns over the potential impact long term for the fisheries industry active in the region.

SEC looks to outsource the leases after missing deal

Mary Schapiro, Chairman of the Securities and Exchange Commission testified at a hearing of the Financial Services Committee of House on the reform of the financial regulation to the Capitol in Washington, June 16, 2011.

Credit: Reuters/Jason Reed

WASHINGTON. Wednesday, July 6, 2011 2: 00 pm EDT

WASHINGTON (AFP) - the Securities and Exchange Commission began discussions to hand in large part off the coast of its rental activities after being accused of bungling a real estate deal to award more half a billion dollars.

Chairman of the SEC, Mary Schapiro said that it is negotiating with the General Services Administration, which manages real estate of the Federal Government, to take over the responsibilities.

The transfer would come after an Inspector General SEC report concluded in May that the SEC is facing a request for $ 94 million after he made numerous errors by obtaining a 10 year deal rental of 556.8 million for a space in Washington.

The expected SEC it needs room for additional staff to implement the law of financial supervision Dodd-Frank, but congressional budget disputes forced to try and return of the lease.

Schapiro said in prepared testimony for a hearing in Congress Wednesday that she is "ultimately responsible for the actions of the Agency" and that she is an urgent need to reduce the financial impact of the lease agreement.

Part of the solution in the long term is to outsource leasing, said Schapiro.

"Leasing is not part of the central mission of the Commission and we cannot allow to impede this mission", said Schapiro.

Rental SEC woes were of great interest to legislators and provided ammunition to some Republicans seeking to deny the extra money for the SEC to conduct Dodd-Frank.

(Reporting by Emily Stephenson; written by Karey Wutkowski; editing by Tim Dobbyn)

HAD slams credit rating agencies after that Portugal downgraded

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European Commission President Jose Manuel Barroso talks with members of the European Parliament ahead of a debate on the EU budget at the European Parliament in Strasbourg, July 5, 2011.

Credit: Reuters/Vincent KesslerBy Gilbert Reilhac and Annika Breidthardt

STRASBOURG, France/BERLIN. Wed Jul 6, 2011 1: 31 pm EDT

STRASBOURG, France/BERLIN (Reuters) - European politicians accused credit rating agencies on Wednesday of anti-European bias after Moody's downgrade of Portugal's debt to "junk" cast new doubt on EU efforts to rescue distressed eurozone states without debt restructuring.

European Commission President Jose Manuel Barroso said the decision to cut Lisbon's rating by four notches so soon after it became the third country to receive an EU/IMF bailout was fuelling speculation in financial markets.

The cost of insuring all weaker eurozone states' debt against default rose after Moody's move, announced on Tuesday.

The euro and European shares fell, ending a seven-day stocks rally, and Portugal had to pay more to sell 3-month T-bills on Wednesday.

"it seems strange that there is not a single rating agency coming from Europe." "It shows there may be some bias in the markets when it comes to the evaluation of the specific issues of Europe," Barroso told reporters in the European Parliament.

German Finance Minister Wolfgang Schaeuble called for limits to be placed on the rating agencies' "oligopoly."

Of the three major agencies, Moody's and Standard & Poor's are U.S. - owned and based. Fitch Ratings is headquartered in New York and London and majority owned by a French company.

The European Union's executive is drafting proposals to regulate rating agencies and there has been political talk, but no action so far, about creating a European agency.

Michel Barnier, the EU official in charge of regulation, said later he could examine how to suspend the rating of countries that are getting bailout funds from the EU and International Monetary Fund. These are Greece, Ireland and Portugal.

Moody's thumbs-down, coming so soon after a new center-right government announced austerity Lisbon plans going beyond international lenders' demands, called into question the EU strategy for dealing with the euro zone sovereign debt crisis.

Moody's said Portugal may need a second round of rescue funds before it can return to capital markets, just as European governments and banks are haggling over a second 120 trillion euro bailout for Greece, which has a much higher debt ratio.

"the key worry of the market is that the events that we've been seeing with greece are being repeated with Portugal," said WestLB rate strategist Michael Leister.

IRELAND TOO?

Ireland, the other eurozone country to have received a bailout, said on Tuesday it may have to make additional spending cuts next year to meet deficit reduction targets in its 85 billion euro bailout plan due to an economic slowdown.

A Reuters analysis last week found that Dublin may also need a second bailout because it is unlikely to grow fast enough to make the envisaged full return to market funding in 2013.

Moody's cited the EU's crisis management, and specifically the attempt to make private creditors share the burden of all future rescues as one reason for its steep downgrade.

The demand that banks and insurers share the risk is driven by growing public hostility in north European creditor nations to any further bailouts for south European states seen as having lived beyond their means.

But Moody's said insisting on private sector involvement not only increased the economic risk facing current investors, but also "may discourage new private sector lending going forward and reduce the likelihood that Portugal will soon be able to boost market access on sustainable terms."

BANKERS FACE OBSTACLE RACE

Representatives of Greece's major creditor banks met in Paris under the aegis of the International Institute of Finance (IIF), a banking lobby, to discuss a proposed rollover of privately held Greek debt but there was no sign of agreement.

Banking sources said numerous issues involving credit ratings, interest rates, maturities and accounting consequences remained to be ironed out among multiple stakeholders and an agreement was only likely in September.

Rating agencies have warned they would be likely to treat any "voluntary" rollover of Greek bonds as a distressed debt exchange and declare it, at least temporarily, to be a selective default.

French banks have offered a plan under which banks would roll over about half of Greek debt that mature in 2011-14, putting another 20 percent into a "guarantee fund" of zero coupon AAA bonds, and cashing out the remaining 30 percent.

German Deputy Finance Minister Joerg Asmussen put Berlin's alternative proposal for a debt swap existing bonds extending the maturities by seven years back on the table on Wednesday, even though the European Central Bank has warned against it.

Asmussen also told Reuters Insider TV it was "absolutely premature" to discuss a second rescue package for Portugal and Berlin was confident the country could implement its reforms and get back on track.

"there is a new government in place so I would really suggest giving the government the time to do what the new government has promised," he said.

"We are confident they are willing and able to implement the first package and get back on track," he said.

New French Finance Minister Francois Baroin was just as dismissive of Moody's action on Portugal.

"A ratings agency's view is not going to solve the matter of voltage on sovereign debt markets and the budgetary crisis," he said, adding he trusted Portugal's new government to meet its deficit reduction target by 2013.

SELF-FULFILLING?

HAD officials complain that the ratings agencies' downgrades are a self-fulfilling prophecy, making it harder for countries under assistance programs to return to capital markets.

Underlying the debate is an increasingly prevalent view in financial markets - disputed publicly by EU governments - that Greece, and possibly also Portugal and Ireland, will have to restructure debt sparkystar or later and force significant losses on bondholders.

The more widespread that assumption becomes, the harder it will be to negotiate further official funding for Greece.

The International Monetary Fund board is expected to approve this week the release of a vitally needed fresh slice of loans for Greece after euro zone finance ministers agreed on Saturday to pay their share.

But IMF sources say disquiet is growing among non-Europeans at the global lender over the risks of pouring more money into Europe's debt crisis with no resolution in sight.

"It goes to show that this whole crisis isn't over just yet." "Even if they cough up some more money for Greece, and that looks like it's a done deal, it's not over," said Jay Bryson, global economist at Wells Fargo Securities.

"I would think it's bad news for Spain and Italy as well."

(Additional reporting by Ana Nicolai da Costa, Naomi Tajitsu and Alex Chambers in London, Walter Brandimarte in New York, Eva Kuehnen, Annika Breidthardt and Gernot Heller in Berlin and Leigh Thomas in Paris; writing by Paul Taylor, editing by Jon Boyle)

IIR Airs selective Greece by default after the Paris Bank meeting - Wall Street Journal

(Recasts and updates throughout with of)

By Sebastian Moffett and Costas Paris

PARIS (Dow Jones) - the head of the Institute of International Finance, said Wednesday that a selective default by the Greece do need not derail the efforts of the country out of its crisis of debt, as bankers discussed a number of options for a salvage contract.

Private banks are trying to find a way to participate in an agreement to reorganize the debts of the Greece to ensure that European taxpayers do not have to provide all the money - but they want to do so in a way which avoids the Greece being declared in default.

Charles Dallara, the...

Oil rises above $95 after Gets the ready Greece slice (AP)

KUALA LUMPUR, Malaysia - oil edged above US $95 per barrel Monday in Asia, reinforced by the news that the Greece was saved from almost collapse after obtaining a vital loan episode.

Reference crude for August delivery was up 23 cents at 95.23 to $ per barrel late afternoon in times of Kuala Lumpur in electronic commerce on the New York Mercantile Exchange. The contract shed 48 cents to settle at $94.94 Friday.

In London, Brent crude for August delivery was down 24 cents at 111.53 $ per barrel on the ice future exchange.

Ministers of the countries that use the common currency of the euro agreed this weekend to pay Athens a euro 12 billion ($17,39 billion) slice of its rescue package 110 billion euro existing before 15 July, in time to meet several deadlines for repayment of bond this month and the next. Europe and the Monetary Fund International will continue to support the faltering economy of the Greece in the years to come.

"That has eased concerns that the crisis of the debt of Greece will be negative impact on economic recovery in Europe," said Victor Shum, analyst with Council energy Purvin & Gertz in Singapore.

He also strengthened the euro and weakened the dollar, arguing the oil prices, he said. Crude is priced in U.S. dollars, so a weakening of the dollar makes it cheaper oil for investors with other currencies.

Shum said a report showing a rebound in U.S. manufacturing also raised hopes of strong economic growth in the more oil in the world consuming nation.

He said trade was thin because of the anniversary of the independence party at the United States but provides that the price of oil to increase gradually up to $100 per barrel if economic news remains positive.

Plants more occupied in June after the spring slump (AP)

NEW YORK - Factory activity picked up in June, after stagnation may, helped by the low price of gas and some disturbances in the supply of facilities.

The Institute for the management of supplies, a trade group of purchasing executives, said Friday that its index of manufacturing activity fell to 55.3. The sector is now developed for 23 straight months. Last month's growth has been slower in 20 months.

The highest reading was an optimistic sign that the economy could be strengthening after collapse of spring.

Stocks jumped after the publication of the report. The Dow Jones industrial average rose 152 points in midday trade and broader indexes also rose.

"This is further evidence that the recent slowdown in economic activity is temporary," said Steven Wood, Chief Economist for Insight economists. "However, the strength of the recovery is a question open, held the other factors."

A reading above 50 indicates the manufacturing sector is expanding. Still, growth has been muted leave earlier this year, when the index topped 60 for four straight months. And other sectors of the economy remain weak, such as housing and employment growth.

Construction spending fell in May to seasonally, a pace of about 758 billion dollars, the Commerce Department said Friday. Budget at the level of State and local cuts led to a sharp decline in government spending. And builders cut spending again, mainly on the apartment projects.

Overall, construction spending was slightly above a low success of 11 years in February. And it is about half the pace $ 1.5 trillion considered healthy by most economists. Analysts say that it could be four more years before the construction refers to healthy levels.

The economy increased by 1.9% during the period from January to March, the Government said last week. Most economists predict growth to be similarly low in the period from April to June.

But the price of gasoline are down. The average price per gallon was $3.55 Friday. It is down nearly $ 4 per gallon, early May.

Cheaper gas should allow consumers to eat out more often and spend more on discretionary purchases, such as furniture and appliances. Consumer spending accounts for 70% of economic activity.

And the impact of a shortage of parts from March 11, earthquake in the Japan appears to be facilitated. All U.S. manufacturers three Friday higher sales in June, after a slowdown in May.

SDA report gave investors some hope that growth will be stronger in the second half of the year, said economist IHS Global Insight Nigel Gault.

There is a little more new orders for the goods in June and resumed employment. Manufacturers in addition to their stocks again.

Economists are also on a resumption of car production to boost growth in the second half. Deutsche Bank economists estimate that manufacturing auto improved could add as much of a full percentage point in the third and fourth quarter, growth.

Some signs from abroad are troubling, too. Chinese manufacturing slipped to its pace slow in 28 months of June, dragged down by rising rates of interest and decline in exports, according to a survey of output Friday in China.

One might think problems with the United States. The factory sector was the primary recovery, increasing driver now for 23 straight months. And strong growth abroad has been a key element of this growth for the major manufacturers of industrial equipment and machinery, such as Caterpillar Inc..

The ISM, a group of trade for the purchase of executives based in Tempe, Arizona, compiles its index of manufacturing by surveying approximately 300 executives buying across the country.

Bank of America, expects loss, after settlement (Reuters)

CHARLOTTE, N.C./NEW YORK (Reuters) - Bank of America Corp. said that it expects to take more than $ 20 billion of costs after settling with mortgage bond investors, resulting in a loss in the second quarter.

The sum, which includes a settlement of $ 8.5 billion, removes a question mark which had been hovering above the Bank since October and the shares of Bank of America is concur.

"Investors can now begin y attach a number of these unknown and what they will cost the Bank.". With the scanning of a pen, they have dealt with a large part of these issues, "said Paul Miller, a banking analyst with FBR Capital Markets.

Chief Executive Brian Moynihan is working hard to go beyond the mortgage crisis and this is the last step of this process.

But the large amounts of dollar linked to the establishment and other efforts to clean up the Bank mortgage exposure in recent months could weigh on the Bank's capital levels as most banks are looking to boost the capital and to return the most money to shareholders.

The Bank has been hit hard by toxic mortgages after prior Bank of America CEO Ken Lewis bought the mortgage lender Countrywide Financial in 2008, as the bubble real estate market exploded.

Other banks, including JPMorgan Chase & Co and Wells Fargo & Co, now could pressure to resolve similar allegations, and new proceedings may arise, said analysts.

A group of 22 investors, BlackRock financial management, argued that the obligations that it has bought Countrywide Financial were packed mortgage which should never have been sold. Bank of America bought Countrywide, the largest once U.S. mortgage in 2008.

Bank of America said that excluding such items that regulation, in the second quarter earnings could top the average Wall Street estimate.

CHEVY VEGA

The regulation is the third in six months for BofA, following similar transactions with investors mortgage Government-supported Fannie Mae and Freddie Mac and insurer assured Guaranty Ltd..

In January, the Bank announced its intention to settle with Fannie and Freddie to $ 2.8 billion. In April, BofA revealed a settlement of 1.6 billion with insured warranty.

Last fall, CEO Moynihan said that the Bank would fight all these requests for redemption. He described the talks with investors on the claims as "bare" and said that some investors are looking for a better deal through share repurchases.

Their attitude, Moynihan said, was "I bought a Chevy Vega but I want this to be a Mercedes".

"We are going to protect shareholders against this", he said during the earnings conference call in the third quarter.

But Moynihan struck a different tone on Wednesday, saying that the company was seeking to put the woes of redemption behind it in terms that would be favourable to the BofA shareholders.

"Our job is to eliminate the risk to allow the company to move forward", he said, dismissing suggestions the bank analysts did not fight in the settlement process.

The redemption of shares with investors dispute began last fall, when a group of prominent mortgage holders threatened to sue on the toxic mortgages.

In December, the two sides to avoid a judgment of the Court by agreeing to talks of regulations which have continued since then.

But the agreement comes at a price for BofA. FBR Miller analyst, said that the regulation leaves little margin of error as the Bank is working to meet the new own funds requirements.

Other analysts are less concerned. Mosby Marty of the titles of the Guggenheim, stated that the Bank has 67 billion dollars in capital surplus according to current rules - and $ 26 billion under new rules proposed industry.

During a conference call announcing the settlement, BofA Chief Financial Officer Bruce Thompson said of Bank projects it can replace the capital with compensation through the next two quarters.

Investors largely welcomed the settlement, as shares increased 3% to $11.14 in late afternoon trade.

"The Bank get the disputes and in the banking business, business", said Greg Donaldson, founder of focus on the Evansville, Indiana Donaldson Capital Management, which holds BofA shares. Donaldson, said that the regulation was the best shot he had seen the Bank over the past two years.

Bank of America said that it should show a loss of 88 cents to 93 cents per share for the second quarter.

Excluding special items, it expected earnings of 28 cents to 33 cents per share. Average forecast of analysts was 28 cents, according to Thomson Reuters I/B/E s.

SIX OR SEVEN YEARS

The Bank said charges would include the settlement of $ 8.5 billion with debt investors, 5.5 billion to cover payments to other mortgage bond investors and of $ 6.4 billion in other costs related to mortgages.

Separately, BofA said it would record a gain of $ 2.5 billion in the quarter from the sale of insurance Balboa and a piece of its remaining set of BlackRock.

Call the CFO said Thompson also at the Conference with analysts that the sale and commercial results were higher in the second quarter from a year ago, but less than in the first quarter of 2011.

The settlement still must be approved in court, and of small investors is not part of the original agreement could challenge.

An attorney for the Group of investors, said that the deal was good for all investors. The regulations will be shared by all investors in securities and institutional investors 22 will not receive special benefits, Kathy Patrick, a Gibbs & Bruns LLP Attorney, said in an interview with blog legal Reuters "on the box".

"I badly to see how someone could get more than that in six or seven years of litigation," said Patrick.

Patrick said that Bank of New York Mellon - the trustee for mortgage-backed securities - had played a crucial role in the colony.

Investors have argued that the mortgages packaged in their obligations did not meet their specifications and Bank of America, which collects mortgage payments, was not enough to maximize collections. Part of the regulations includes improvements in the collection of payments, known as maintenance.

"This regulation is likely to encourage the counsel for the other applicant to go after other banks and look for similarities in their securitization transactions," said Nancy Bush, an analyst with Bank veteran.

BofA is still negotiating with a group of State and federal regulatory agencies - including a coalition of all 50 state attorneys general - industry improperly barred on the borrowers offenders allegations.

(Reports by Joe Rauch and David Henry, additional by Brenton Cordeiro in Bangalore and Lauren Tara LaCapra and Dan Wilchins in New York.) (Editing by Lisa Von Ahn, John Wallace, Gary Hill)

Set of Greece for the final vote on the cuts after riots (AP)

Athens, Greece - Greek lawmakers are set to pass a bill Thursday to fast track austerity costs demanded by creditors, following two days of riots in Athens that left some 200 people injured and damaged 50 shops.

The Greece international creditors insisted Greece return for a package of austerity and Bill in return associated implementation to give more money in the country. On Wednesday, Parliament approved the package ($40 billion) billion euro28 of five-year spending cuts and tax increases, leaving the details of the cuts to be approved Thursday.

Once and if bill Thursday to implement austerity measures is deselected, the euro and the Monetary Fund International will be able to release the euro12 billion ($17 billion), which is due by year package last of the Greece rescue loans. Several of the measures described will be in kick almost immediately.

Without financial assistance, the Greece faced bankruptcy as early as mid-July. A Greek default on its debt could trigger a major banking crisis and potential trouble markets worldwide, similar to what happened when the Lehman Brothers investment house collapsed in 2008 at the United States.

Thus, in markets around the world breathed a sigh of relief after the Wednesday vote - then that municipal authorities in the Greek capital struggling with damage from the two days of violent demonstrations.

The next opus ready billion EU - IMF of euro12 will tide Greece until mid-September, according to the representatives of the Government, but it seems that in the years to come, it will need lots of money. Creditors are considering to give Greece a package of support then, cover the major upcoming funding gaps.

Billion ($159 billion) package the year last European was based on the Greece being able to tap investors bonds for cash next year, but with interest rates of the country to excessive levels, which seems very unlikely.

The austerity measures imposed in Greece in exchange for foreign assistance are met with resistance.

Wednesday, riots erupted for a second day before the Parliament in Athens, with the police in the face and firing tear gas at demonstrators after a failed attempt to blockade the building.

Trade associations, said about 50 shops were damaged, mostly coffee shops and restaurants fast food near Parliament, while tourists and other guests were evacuated to a hotel in central Athens.

Municipal crews worked all night to clear the streets of city center which had been strewn with broken paving stones, bottles of mineral water, burned garbage cans and broken glass.

Government officials said that they were not satisfied with the police in riots that lasted nearly 10 hours Wednesday, but the Thanassis police spokesman Kokkalakis said that they had managed to protect Parliament and prevent serious injuries and property damage.

Without major protests were planned Thursday and the power of the workers called a strike which caused rolling blackouts of business days. The ferry to the Greek islands services more ports of Athens were cancelled for a third day, however, because of the strike of the workers of a port.

Union officials said that it would be performing a central Athens Thursday gathering later.

Greek Hoteliers Association has launched an appeal in deference to the police, the demonstrators, warning of violence and unions could hit high season reservations.

"Once again, a public world television images (riots) witness that would discourage even the most determined potential to visit our country visitors" as association statement said.

But Andreas Andreadis, head of the Association of Greek tourist enterprises, told Associated Press that he did not believe that the riots would have a lasting effect on a generally good year for Greek holiday industry.

"There was a small hollow in reservations, mainly in Athens, for the last days of four or five, but it is likely to return to normal," said. "We remain on course for an increase of 10 percent of travel bookings this year than in 2010".

Bank of America, expects loss, after settlement

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Customers are seen outside of a Bank of America in Tucson, Arizona January 21, 2011. Bank of America Corp., the largest U.S. bank, reported weaker-than-expected revenue and a second straight quarterly loss after its limping mortgage business triggered writedowns and legal settlements.

Credit: Reuters/Joshua LottBy Joe Rauch and David Henry

CHARLOTTE, N.C./NEW YORK. Wed Jun 29, 2011 8: 11 pm EDT

CHARLOTTE, N.C./NEW YORK (Reuters) - Bank of America Corp. said it expects to take more than $20 billion of charges after settling with mortgage bond investors, resulting in a second - quarter loss.

The sum, which includes an $8.5 billion settlement, removes a question mark that had been hovering over the bank since October, and Bank of America's shares rallied.

"investors can now start attaching a number to these unknowns and what they will cost the bank." "With the swipe of a pen, they've dealt with a large chunk of these issues," said Paul Miller, a banking analyst with FBR Capital Markets.

Chief Executive Brian Moynihan is working hard to move past the mortgage crisis, and this settlement is the latest step in that process.

But the large dollar amounts linked to the settlement and the bank's other efforts to clean up mortgage exposure in recent months could weigh on the bank's capital levels as most banks are looking to boost capital and return more money to shareholders.

The bank was hit hard by toxic home loans after Ken Lewis, Bank of America's prior CEO, bought mortgage lender Countrywide Financial in 2008, just as the housing market bubble was bursting.

Other banks, including JPMorgan Chase & Co and Wells Fargo & Co, could now face pressure to resolve similar allegations, and new lawsuits may arise, analysts said.

A group of 22 investors, including BlackRock Financial Management, alleged that bonds it bought from Countrywide Financial were packed with mortgages that should never have been sold. Bank of America bought Countrywide, once the largest U.S. mortgage lender, in 2008.

Bank of America said that excluding items such as the settlement, second - quarter earnings could top the average Wall Street estimate.

CHEVY VEGA

The settlement is the third in six months for BofA, following similar deals with government-backed mortgage investors Fannie Mae and Freddie Mac, and insurer Assured Guaranty Ltd..

In January, the bank announced plans to settle with Fannie and Freddie for $2.8 billion. In April, BofA disclosed a $1.6 billion settlement with Assured Guaranty.

Last fall, CEO Moynihan said the bank would fight any such repurchase requests. He described talks with investors over claims as "hand-to-hand combat" and said some investors were looking for a better deal through repurchases.

Their attitude, Moynihan said, was "I bought a Chevy Vega goal I want it to be a Mercedes."

"we re going to protect shareholders against that," he said during the company's third - quarter earnings conference call.

But Moynihan struck a different tone on Wednesday, saying the company was looking to put repurchase woes behind it in terms that would be favourable to BofA shareholders.

"our job is to eliminate risks to allow this company to go forward," he said, dismissing suggestions from analysts that the bank did not put up a fight in the settlement process.

The repurchase dispute with investors began last fall, when a group of prominent mortgage securities holders threatened to sue over the toxic mortgages.

In December, the two sides avoided a short box by agreeing to settlement talks that have continued since then.

But the deal comes at a price for BofA. FBR analyst Miller said the settlement leaves little margin for error as the bank works to meet new capital requirements.

Other analysts are less concerned. Marty Mosby of Guggenheim Securities said the bank has $67 billion in excess capital under current rules - and $26 billion under new proposed industry rules.

During a conference call announcing the settlement, BofA Chief Financial Officer Bruce Thompson said the bank projects it can replace the capital with earnings through the next two quarters.

Investors largely welcomed the settlement, as shares rose 3 percent to $11.14 in late afternoon trading.

"The bank has to get out of the litigation business and back into the banking business," said Greg Donaldson, founder of Evansville, Indiana - based Donaldson Capital Management, which owns BofA shares. Donaldson said the settlement was the best move he had seen from the bank in the last two years.

Bank of America said it expected to post a loss of 88 cents to 93 cents per share for the second quarter.

Excluding special items, it expects earnings of 28 cents to 33 cents a share. Analysts' average forecast was 28 cents, according to Thomson Reuters I/B/E/S.

SIX OR SEVEN YEARS

The bank said charges would include the $8.5 billion settlement with bond investors, $5.5 billion to cover payments to other mortgage bond investors expected, and $6.4 billion in other charges linked to mortgages.

Separately, BofA said it would record a $2.5 trillion gain in the quarter from the sale of Balboa Insurance and a chunk of its remaining BlackRock stake.

CFO Thompson also said during the conference call with analysts that sale and trading results were higher in the second quarter compared with a year ago, but lower than in the first quarter of 2011.

The settlement must still be approved in court, and small investors not part of the initial agreement could contest it.

An attorney for the investor group said the deal was good for all investors. The settlement will be shared among all investors in the securities, and the 22 institutional investors will not receive special benefits, Kathy Patrick, an attorney at Gibbs & Bruns LLP, said in an interview with Reuters' "On the box" legal blog.

"I have a hard time seeing how anyone could recover more than this in six or seven years of litigation," Patrick said.

Patrick said Bank of New York Mellon - the trustee for the mortgage-backed securities - played a crucial role in the settlement.

The investors argued that the mortgages packaged into their bonds did not meet their specifications, and that Bank of America, which is collecting payments on the mortgages, was not doing enough to maximize the collections. Part of the settlement includes improvements in gathering payments, known as servicing.

"This settlement is likely to embolden the other plaintiff's lawyers to go after other banks and look for similarities in their securitizations," said Nancy Bush, a veteran bank analyst.

BofA is still negotiating with a group of state and federal regulators - including a coalition of all 50 state attorneys general - over allegations the industry improperly foreclosed on delinquent borrowers.

(Reporting by Joe Rauch and David Henry, additional reporting by Brenton Cordeiro in Bangalore and Lauren Tara LaCapra and Dan Wilchins in New York;) (Editing by Lisa Von Ahn, John Wallace, Gary Hill)

European stocks higher after the sale of bond of Portugal (AFP)

London (AFP) - European stock markets were higher Wednesday as zone euro debt worries were soothed by auction link successful record economic growth for the Germany and the Portugal, said analysts.

Index FTSE 100 in London main actions increased by 0.33% to 6,034.04 points in midday trading.

DAX 30 Frankfurt rallied 1.23% at 7,027.02 points and Paris CAC 40 has acquired from 1.25% to 3,910.09.

The Lisbon market was 0.86% while Madrid has climbed to more than 3.46%, driven by an increase in the banks of the shares.

Portugal paid lowest on long-term debt rates of 1.25 billion euros ($1.62 billion) Wednesday it raised in a test critical for its credibility and the wider area in euro capital markets.

The DMU Portuguese, said the performance or the rate of return for investors in bonds coming due June 2020 descended to 6.716%, passing from 6.806% during a similar sale in November.

However, bonds coming due October 2014 offering also, performance is passed to 5.396%, until suddenly 4.041 p paid November — suggesting that short-term Outlook was more guarded.

"The Portuguese auction was well received," RIA Capital Markets analyst Nick Stamenkovi? told AFP.

"Not only did Portuguese treasure to draw the maximum provided, but performance was below November." This should encourage a gathering of relief for the Portuguese sovereign bonds. »

EU diplomats say that Portugal comes under strong pressure from several European countries to accept external aid in the middle of the concern that a debt crisis fresh euro area may spread in Spain, a much larger economy.

For its part, Spain also provides its first issues long term of the year on Thursday, to sensitize the two to three billion euros over 5 years bonds.

The great fear is that, if the bond rates go too high, the Spain may be forced to seek an international rescue - a crisis with global implications that would dwarf the bail out the Irish and Greek and possible similar to the Portugal action.

Debt auction Wednesday marked first foray of the Portugal in bond, since the Ireland was forced to seek a November EU - IMF rescue plan.

Prior to the auction on Wednesday, the dataset for the great economy of Europe in Germany showed German growth hit a record 3.6% last year.

Germany incurred by 4.7% in 2009 in its worst post-war recession of bounce to show the strongest growth since its reunification in October 1990.

We've grown twice the average of the European Union"in 2010, said Rainer Bruederle economy Minister.

Asian markets stock edged upward Wednesday, taking a cautious approach to the debt crisis in Europe, but with the rise in the prices of products supporting resource stocks.

Actions were usually stimulated by gains on Wall Street and the Japan announced that it will buy bonds of a eurozone Rescue Fund to help fund the bailout of the Ireland and support the block of debt-hit, said analysts.

U.S. stocks posted gains moderate Tuesday, supported by a positive start to the season of quarterly earnings.

Automakers boost Wall Street after benefit of Lennar (Reuters)

NEW YORK (Reuters) - U.S. Pink stocks Tuesday after several reports of higher than expected fourth-quarter earnings and prospects involving the S & P 500 index courses to align three straight sessions of decline.

Builder Lennar Corp. (LEN)(N) sudden 9.3 20.65% $ after the posting of a significantly higher than expected fourth-quarter profit.

"Lennar had many." Builders was obviously an area which was very low, and for the guys who had a good number, which helped, said Stephen Massocca, managing director of Wedbush Morgan, in San Francisco.

Index Dow Jones us Home Construction (.)(DJUSHB) has increased from 3.9% and PHLX housing sector index (.)(HGX) gained 2.4%.

Stocks are aligned in recent weeks in part on the optimism about the benefits of stronger companies, with the S & P up to 8% since the beginning of December.

However, the reference S & P 500 has lost ground over the past three sessions, leading some analysts to question whether if stocks had become expensive or whether withdrawal means stocks climb again rolled into the new salary.

"It gets a bit frothy." "No matter what stock few who has a little wiggle it a bunch of guys are piling in it," said Massocca.

Sears Holding Corp. (SHLD)(O) the estimates rose 6.8% to $75.39 after chain store its prospects of profit above Wall Street, citing sales.

The Dow Jones industrial average (.)(DJI) has increased 53.32 points, 0.46%, to 11,690.77. The Standard & Poor 500 Index (.)(SPX) acquired 6.28 points, or 0.49 percent, at 1,276.03. Nasdaq Composite Index (.)(IXIC) added 11.36(2) points, or 0.42 per cent, to 2,719.16.

Alcoa Inc. (AA).(N) posted quarterly earnings that exceeded Wall Street expectations even though some missed income average estimate of analysts. The actions of the manufacturer of aluminium dropped 1.2% at $16.28.

Alcoa provides a 12% increase in demand for aluminum this year, which some analysts questioned, but other benefits taken could be factor. Alcoa shares had increased by 24% since the beginning of December.

Chain supermarkets Supervalu Inc (SVU.)(N) crumpled 11.5% $ 7.60 after the posting of third-quarter adjusted profit missed expectations.

(Statement by Chuck Mikolajczak;) (Editing by Kenneth Barry)

European stocks less close after data jobs in the United States (AFP)

London (AFP) - European stocks fell after only the most recent Friday data showing low U.S. jobs hopes for a strong economic recovery, said dealers.

FTSE 100 index of London closed main actions 0.59% at 5,984.33 points, to Paris du CAC 40 fell 1.0% to 3,865.58 points and at the Frankfurt DAX slid 0.48% to 6,947.84 points.

Tempered Amsterdam 0.13%, Milan has dropped 0.46%, stocks dragged Swiss 0.54% and Brussels ended down 0.77%.

Stocks plunged 3.02 percent to Lisbon after the yields on government bonds Portuguese hit New Records, a few days before that the country plans to try to place long-term debt for the first time this year.

European markets have fallen low morning trading before the release of U.S. jobs data and fell more thereafter.

The Department of labor of the United States has published its monthly unemployment report closely monitored which investors had hoped would confirm recent data showing that the U.S. economic recovery taking speed.

But the data offered a mixed picture.

The unemployment rate has strongly to 9.4% in December from 9.8% in November to its lowest level since May 2009 and estimate better than average of 9.7%.

But at the same time, the economy has created 103,000 jobs, much less than 150,000 forecasts by analysts.

A report earlier in the week by the firm of ADP showing a sharp increase in sector private hire at 300 000 in December raised expectations that the U.S. economic recovery could finally begin to replace the jobs lost.

"It's a cold (ish) shower after the excitement generated by ADP," reported earlier this week a stellar rise in private hiring in December, said Ian Shepherdson for high frequency economics.

"Acceleration of the underlying trend but progress is quite slow," he said in a note to customer.

Chairman of the Federal Reserve Ben Bernanke warned that the current rate of job creation was insufficient and meant "long", will require right of the labour market.

"Economic recovery began a year ago and a half East continues," the pattern of the Fed said in testimony prepared for the Congress, "Although, to date, at a pace that was insufficient to reduce significantly the rate of unemployment."

"Probably a considerable time be necessary until unemployment rate returned to more normal levels."

Wall Street has opened the dish and then dragged down.

The Dow Jones Industrial Average fell 0.31% at 11,661.40 points around 1700 GMT, while the index S & P 500, a broader measure of the market, had fallen by 0.37% at 1,269.14 points.

Tech-rich Nasdaq was off the coast of 0.39% to 2,699.29 points.

New year Asia stocks rally showed signs of discolouration Friday in the middle of prudence before data from the United States, while Tokyo's Nikkei hit a top eight months with a stronger dollar, giving boost to auto stocks.

Nikkei index in Tokyo edged 0.11 percent for its end above since May 13, supported by the car manufacturers such as Toyota and Nissan as a strong dollar boosted the US sales prospects.

However, Hang Seng Hong Kong dropped 0.42%, which broke a gathering of seven days. The two exchanges are student to approximately 3 per cent in the week.

Sydney dropped 0.42% at the end of the week in which minor coal have been affected by the catastrophic floods and of commodities slid prices.

Carpentry among industries which are not bounce after the recession (Washington Post)

To LAS VEGAS - every day in this city in the desert, the rise of carpenters in their pickup trucks and vans, resume stacked on the passenger seats, driving at Union Hall, and then circles construction one bound to the string to another, seeking work.

For one year or more, it was the same.

Nothing.

If they keep continuing work as carpenters, in fact, many of them can never find a job.

Beyond the recession, there has been an article of faith, as the economy revives, will return to work. But after the deep recession that began in December 2007, jobs in some industries are not returned.

This creates what economists call "structural unemployment," the result of a mismatch between the skills of the workforce and those required by employers. There is a concern because it causes longer periods of unemployment as workers are trying to transition from one business to another.

In some occupations is lighter than among the carpenters brand. In May 2006, approximately one million people have been used as carpenters, according to the Bureau of Labor Statistics. In the last year, this number decreased to less than 750 000. Predict economists, it is unlikely to climb these 1990s levels.

To obtain narrower on the phenomena, The insight Washington Post hunted 31 carpenters who had worked on one of the largest projects in Las Vegas, a city which has swept in the frenzy of speculative construction and now has one of the rates of unemployment highest in the country.

Today, at least 22 of 31 are unemployed, many of them for a year.

Five have lost their homes due to foreclosure or because they were unable to pay the rent. Three other live with their parents or their in-laws. Many people the rest still slipping financially, fear that they have their head in the same direction.

Workers keep seeking woodworking jobs because it's what they know. They have been learning, training and experience in the field. They were built with skyscrapers, bridges and power plants. And the Union wage is $ 37 now, so when additional flows, they can make good income.

Construction workers are used to ups and downs, but this time is different, and carpenters, often bluff and secular, speak in flagging voices were asked about their prospects.

VW sold 7 million cars in 2010, after a break of monthly deliveries (BusinessWeek)

December 10 (Bloomberg) – Volkswagen AG, the largest manufacturer of Europe, stated annual shipments exceed 7 million for the first time in 2010, after sales last month acquired 16 percent.

Deliveries of marks group VW Audi and Skoda division Czech Deluxe unit has increased 617,000 units in November, VW Wolfsburg, based Germany said today in a statement. Eleven months advanced sales 13 percent million contract. "" Volkswagen benefits disproportionate for the resumption of most major markets automotive, "VW sales leader Christian Klingler said in the statement. "We be well above the level of last year and anticipate annual shipments over 7 million vehicles for the first time.Volkswagen is entitled to demand for models, including the VW brand compact Golf and cut Audi A7, as well as booming sales in China, its largest market. Car deliveries in sudden China 29 percent in November to record 1.34 million, the Association of automotive China said yesterday.Volkswagen invest 51.6 billion euros ($68.3 billion) in his company for the manufacture of car in the next five years as the company wants to exceed Toyota Motor Corp the largest manufacturer in the world. Expansion plans depend on success in China, where VW adds two factories in four years to double production of 3 million cars.

-Editor: Chad Thomas

To contact the reporter on this story: Andreas Cremer acremer@bloomberg.net Berlin.

To contact the responsible editor of the story: Kenneth Wong, the kwong11@bloomberg.net.