U.S. Treasuries Are Little Changed on Growth Concern as Stocks Decline

(Bloomberg) -- Treasuries were little changed as
global stocks fell and speculation increased that losses tied to
subprime mortgages will slow economic growth.

Ten-year notes may extend their gains into a fifth week
after the risk of owning corporate bonds rose and a report showed
employers added fewer jobs than expected last month. Investors
increased bets the Federal Reserve will cut interest rates as
soon as October.


Read more at Bloomberg Bonds News

Use Swaptions to bet U.K. Interest Rates Have Peaked, Credit Suisse Says

(Bloomberg) -- Investors should use swaptions to bet
the Bank of England won't raise benchmark interest rates beyond
5.75 percent because inflation has peaked, according to Credit
Suisse.

Prices for swaptions, options on interest rate swaps,
signal traders expect further rate increases. Investors can
profit with swaptions if benchmark rates hold steady, analysts
at Credit Suisse, Switzerland's second-biggest bank, said in a
strategy note.


Read more at Bloomberg Currencies News

Global stocks steady after earnings soothe credit nerves

(Reuters) - Almost two weeks of a sell-off in equity and credit markets stemmed from concerns that a fallout in the U.S. housing sector will trigger a broad repricing of risks in a market which enjoyed cheap money and high appetite for high-yielding assets.




But a string of forecast-beating results from major companies, including Allianz , Royal Bank of Scotland and British Airways on Friday, has helped soothe such concerns. Investors are keen to see U.S. jobs data due later in the day for more clues on the strength of the economy.


Read more at Reuters.com Hot Stocks News

Cheapest Stocks in 16 Years Entice Investors After $2.1 Trillion Decline

(Bloomberg) -- Investors are preparing to snap up
shares of telephone, health-care and computer companies after
last week's $2.1 trillion global stock market rout left U.S.
equities the cheapest in 16 years.

``The window for buying is starting to open,'' said D.A.
Davidson & Co. chief market strategist Frederic Dickson, who
oversees $23 billion. His Great Falls, Montana-based firm plans
to buy drug and technology stocks as long as bond market losses
don't worsen.


Read more at Bloomberg Stocks News

European Bonds Advance After Global Stocks Slump on U.S. Housing Concerns

(Bloomberg) -- European government bonds climbed,
pushing 10-year yields to the lowest in almost two months, after
stocks declined in the U.S. and Asia on concern a housing slump
is worsening.

Benchmark bonds rose for a second day after shares of U.S.
homebuilders sank to their lowest since 2003. A credit market
rout caused by defaults on U.S. subprime mortgages gives
``serious reasons to worry,'' without posing a systemic threat,
Moody's Investors Service said in a report.


Read more at Bloomberg Bonds News

Structured Vehicles Are `Oasis of Calm' in Subprime Crisis, Moody's Says

(Bloomberg) -- So-called structured investment
vehicles, which hold $370 billion of assets, represent ``an
oasis of calm'' among debt issuers linked to subprime mortgages,
according to Moody's Investors Service.

Moody's expects ``ratings in the SIV and hybrid SIV sectors
to remain stable amid the current maelstrom surrounding the U.S.
subprime housing market,'' partly because of the diversity of
their portfolios, analyst Henry Tabe in London said in a
statement summarizing the firm's July 20 report.


Read more at Bloomberg Bonds News

Wells Fargo pulls popular subprime loan from mix

(Reuters) - The company in an e-mail said it ended on Friday retail offerings of so-called 2/28 loans, which at 65 percent of all subprime mortgages last year are the staple of the industry. Payments on 2/28 adjustable-rate mortgages are based on rates that are fixed for two years and then are adjusted twice a year for the remaining 28, if the loan is not refinanced.




Decisions were partly driven by the $583 billion market for subprime mortgage bonds, where sales rely on opinions of rating companies such as Moody's Investors Service, Wells Fargo said. Rating companies in the past two weeks have unleashed a flood of downgrades on subprime bonds in response to rising delinquencies and increased their assumptions of losses that new loans will produce.


Read more at Reuters.com Bonds News

Japan's Nikkei 225 Average, Topix Falls; Exporters Drop on U.S. Earnings

(Bloomberg) -- Japanese shares dropped, paced by
companies that rely on the U.S. market, after Caterpillar Inc.
said its profit dropped on lower North American sales. Exporters
such as Honda Motor Co. and Komatsu Ltd. declined.

Investors also refrained from betting heavily on stocks
before the upper house election, which will be held on July 29.
The Nikkei newspaper reported yesterday Japan's ruling coalition
may lose its majority in the election, citing its own poll.


Read more at Bloomberg Stocks News

UPDATE 3-SunPower posts loss, targets output growth

(Reuters) - Investors shrugged off higher-than-expected earnings before
special items and the company's statement that it was on track
to continue increasing its production.




SunPower reported a net loss of $5.3 million, or 7 cents
per share, compared with a year-earlier profit of $1.2 million,
or 8 cents per share.


Read more at Reuters.com Market News

U.K. Pound May Advance Versus Dollar on Outlook for BOE Rates, U.S. Growth

(Bloomberg) -- The pound may rise against the dollar
on speculation the Bank of England will keep raising interest
rates as the Federal Reserve keeps borrowing costs on hold.

The U.K. currency advanced to a 26-year high versus the
dollar after the Fed yesterday trimmed its forecast for economic
growth and Bear Stearns Cos. reported losses on hedge funds that
bet on bonds backed by subprime mortgages. Investors expect the
BOE to raise rates half a percentage point by year-end, futures
trading shows.


Read more at Bloomberg Currencies News

Moody's Excluded From Rating 70 Percent of New Commercial-Mortgage Bonds

(Bloomberg) -- Moody's Investors Service has been
excluded from rating 70 percent of new commercial mortgage-backed
securities after toughening its guidelines.

Moody's has been shut out of nine of the past 13 deals as
underwriters sought better ratings from rival companies, Tad
Philipp, a managing director at Moody's said today in a telephone
interview. The securities had a face value of more than $25
billion.


Read more at Bloomberg Bonds News

Clear Channel sets clock ticking on investor vote

(Reuters) - Investors have to own shares before that date if their vote
on the deal is to be counted.




San Antonio-based Clear Channel agreed in May to put a
$39.20-a-share bid from Bain Capital Partners and Thomas H. Lee
Partners [THL.UL] to a shareholder vote. That deal gives
investors an option to hold a stake of up to 30 percent in the
company following the buyout, known as "stub equity".


Read more at Reuters.com Mergers News

Treasuries Rise on Subprime Mortgage Crisis, Outlook for Economic Slowdown

(Bloomberg) -- Treasuries rose as the subprime
mortgage crisis sent investors to the safety of U.S. government
debt and raised concern that housing weakness will slow the
world's largest economy.

Benchmark 10-year note yields dropped this week after
Standard & Poor's and Moody's Investors Service warned about the
credit quality of subprime mortgages. Federal Reserve Chairman
Ben S. Bernanke may comment on housing during congressional
testimony next week.


Read more at Bloomberg Bonds News

Moody's Investigates Asian Banks for Holdings of Subprime Mortgages Bonds

(Bloomberg) -- Moody's Investors Service is
investigating Asian banks for holdings linked to subprime loans,
which caused losses in mortgage-backed bonds in the U.S.,
Moody's analyst Deborah Schuler said.

``We're in the process of checking the banks we rate in
Asia for investments in those sectors,'' Schuler said. ``We'd be
quite surprised to find that anybody had a number big enough
that it's going to cause even a tiny bit of pain.''


Read more at Bloomberg Bonds News

Asian Currencies Gain as Stock Rally Draws Investors to Emerging Markets

(Bloomberg) -- Asian currencies, including
Indonesia's rupiah and the South Korean won, gained on
speculation a regional stock rally will increase demand for
emerging-market assets.

Investors sold yen to fund higher-yielding currencies in
so-called carry trades, said Catherine Tan, head of emerging
markets at Forecast Singapore Ltd. A surge in U.S. stocks
yesterday eased concern a housing slump will stunt export-led
economic growth in Asia.


Read more at Bloomberg Currencies News

Rio Tinto May Borrow as Much as $40 Billion to Finance Alcan Acquisition

(Bloomberg) -- Rio Tinto Group will borrow as much
as $40 billion to finance the acquisition of aluminum producer
Alcan Inc., according to Moody's Investors Service.

Rio Tinto, the world's third-largest mining company, hired
Royal Bank of Scotland Group Plc, Deutsche Bank AG, Credit Suisse
Group, and Societe Generale SA to finance the $38.1 billion deal,
the London-based company said today in a statement. The all-cash
offer for Montreal-based Alcan will be funded from banks, Moody's
said, which would make it the second-biggest loan in Europe.


Read more at Bloomberg Bonds News

Bank of America Says Use Options to Bet on Brazilian Real Drop Nex Year

(Bloomberg) -- Investors should use options to bet
the Brazilian real appreciates for the next six months against
the dollar before weakening as inflation starts to accelerate,
according to Bank of America Corp.

The currency will add to this year's 13 percent gain as
high interest rates and robust economic growth bolster demand
for the country's stocks and bonds, the Charlotte, North
Carolina-based bank, the biggest U.S. one by deposits, said in a
strategy note dated July 10.


Read more at Bloomberg Currencies News

European Government Bonds Erase Gains as Investors' Subprime Concerns Ease

(Bloomberg) -- European bonds were little changed,
erasing earlier gains, after a rebound in U.S. stocks prompted
investors to return to riskier assets.

Benchmark debt earlier surged, pushing 10-year bund yields
down by the most in a year yesterday, after Moody's Investors
Services cut the credit ratings on $5.2 billion of bonds backed
by subprime mortgages and Standard & Poor's warned it may
downgrade $12 billion of debt. Stocks rebounded as investors bet
the global economy will continue growing, eroding demand for the
safest assets.


Read more at Bloomberg Bonds News

Bogota Plans International Sale of $300 Million of Peso Bonds, Person Says

(Bloomberg) -- Bogota, Colombia's capital city,
plans a sale of $300 million of 21-year, peso-denominated bonds
in international markets as part of its plans to refinance
maturing debt and fund infrastructure projects, according to a
person familiar with the sale.

The bonds will have equal amortization of capital in 2026,
2027 and 2028 and be payable in U.S. dollars, according to the
person, who declined to be cited by name because terms aren't
set. The issue is expected to be rated Ba1 by Moody's Investors
Service, and BB+ by Standard and Poor's and Fitch Ratings Inc.
respectively. All ratings are one level below investment grade.


Read more at Bloomberg Emerging Markets News

Danone credit rating cut seen likely on Numico deal

(Reuters) - Danone's 12.3 billion euros
takeover of Numico , announced on Monday, follows an
agreement by the company last week to sell its biscuits business
to Kraft Foods Inc. .




The Numico deal, expected to generate net debt of 7 billion
euros, will likely prompt a downgrade of Danone's current A1 and
and A+ ratings from Moody's Investors Service and Standard &
Poor's, although by how much will depend on how the deal is
financed.


Read more at Reuters.com Bonds News