Japan Stock Futures Rise on Signs U.S. Lawmakers Close to Debt Agreement
July 31, 2011
Japanese stock futures gained amid optimism U.S. lawmakers will reach an agreement on raising the federal debt ceiling one day before the Treasury Department says it will run out of cash to pay its bills.
Original post:
Japanese stock futures gained amid optimism U.S. lawmakers will reach an agreement on raising the federal debt ceiling one day before the Treasury Department says it will run out of cash to pay its bills.
American depositary receipts of Toyota Motor Corp., the world’s largest carmaker that counts North America as its biggest market, increased 0.3 percent from the closing share price in Tokyo. Those of Kyocera Corp., a maker of solar panels that gets 17 percent of its revenue in the U.S., gained 0.3 percent. ADRs of NTT DoCoMo Inc., Japan’s No. 1 mobile-phone operator by market value, advanced 1.2 percent after the company said first-quarter profit increased.
Futures on Japan’s Nikkei 225 (NKY) Stock Average expiring in September were bid in the pre-market at 9,890 in Osaka at 8:05 a.m. local time compared with their July 29 closing level of 9,820 in Chicago and 9,830 in Osaka. Futures on Australia’s S&P/ASX 200 Index slid 0.1 percent today. New Zealand’s NZX 50 Index gained 0.1 percent in Wellington.
“The U.S. debt ceiling talks are moving toward an agreement and the dollar’s depreciation is easing,” said Kazuhiro Takahashi, a general manager at Daiwa Securities Capital Markets Co. in Tokyo. “More and more companies are reporting earnings that exceed analysts’ estimates or raising profit forecasts, and that’s bringing a feeling of hope.”
Futures on the Standard & Poor’s 500 Index jumped 1.2 percent today amid optimism lawmakers and President Barack Obama are close to an agreement to raise the federal debt ceiling and avoid a default.
Tentative Agreement
Senate Majority Leader Harry Reid approved a tentative agreement with Republican leaders and the Obama administration to raise the borrowing limit pending approval by fellow Senate Democrats, according to a spokesman.
Congressional leaders and the Obama administration negotiated to finish the details of the agreement, paving the way for possible votes in the Senate and House. Senate Republican leader Mitch McConnell said that congressional negotiators and Obama are “very close” to a deal, having made “dramatic progress” on July 30.
The dollar climbed versus the euro, yen and Swiss franc after Reid’s office said he signed off on a proposed deal, pending approval of fellow Senate Democrats. The Dollar Index, which tracks the currency against six counterparts, fell in July as debt talks and concern over slow growth damped demand for the greenback.
U.S. Growth
In New York, the S&P 500 fell 0.7 percent to 1,292.28 on July 29 as economic growth trailed forecasts and investors awaited the outcome of negotiations to avoid a debt default.
The Commerce Department reported gross domestic product rose at a 1.3 percent annual rate in the second quarter following a 0.4 percent gain in the previous three months that was less than originally estimated. The median forecast of economists surveyed by Bloomberg News called for a 1.8 percent increase. Household purchases, which make up about 70 percent of the economy, climbed 0.1 percent.
In a separate report, the Institute for Supply Management- Chicago Inc. said on July 29 its business barometer fell to 58.8 in July, lower than forecast, from 61.1 the prior month. Figures greater than 50 signal expansion.
In Europe, Moody’s Investors Service said on July 29 that it is reviewing Spain’s Aa2 classification as its regions struggle to cut budget deficits and last week’s Greek bailout increases the risk that bondholders will have to pay for further European rescues. A cut would probably be “limited to one notch,” Moody’s said. Spain has the same credit rating as Italy, which is also on review for downgrade at Moody’s.
Yearly Loss
The MSCI Asia Pacific Index lost 0.7 percent this year through July 29, compared with a gain of 2.8 percent by the S&P 500 and a drop of 3.8 percent by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 13.4 times estimated earnings on average, compared with 12.9 times for the S&P 500 and 10.8 times for the Stoxx 600.
In Japan, of the 620 companies that have released quarterly earnings results since July 11, 98 have reported profit surprises, exceeding 59 firms that reported disappointing results, according to data compiled by Bloomberg.
NTT DoCoMo said on July 29 that net income increased 12 percent to 158 billion yen ($2 billion) for the April-June period, citing cost reductions.
To contact the reporters on this story: Akiko Ikeda in Tokyo at iakiko@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net.
To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net.
Stock Futures Surge, Dollar, Oil Gain on Debt-Plan Optimism
July 31, 2011
July 31, 2011, 9:24 PM EDT By Shiyin Chen and Rita Nazareth (For a special report on the debt debate, see EXT6) Aug.
Read the original:
July 31, 2011, 9:24 PM EDT
By Shiyin Chen and Rita Nazareth
(For a special report on the debt debate, see EXT6)
Aug. 1 (Bloomberg) — Asian stocks snapped a three-day loss, U.S. stock futures surged and the dollar gained versus the yen and Swiss franc after President Barack Obama said Congressional leaders reached an agreement to raise America’s debt ceiling.
The MSCI Asia Pacific Index rose 0.8 percent as of 9:49 a.m. in Tokyo. Standard & Poor’s 500 futures expiring in September advanced 1.4 percent. The U.S. dollar strengthened 1.3 percent against the yen and 1 percent versus the Swiss franc. Treasuries declined for the first time in three days. Oil rose 1.5 percent on the New York Mercantile Exchange. Gold fell from a record.
Leaders of the Republican and Democrat parties have reached an agreement that will reduce the U.S. deficit and avoid a default, Obama said in remarks at the White House.
“They are going to pull a rabbit out of the hat,” Jeffrey Saut, chief investment strategist at Raymond James & Associates in St. Petersburg, Florida, said in a telephone interview before Obama’s comments. His firm manages $275 billion. “The word default that’s being thrown around is being used inappropriately. I don’t think the U.S. in any way, shape or form is going to default. The collateral damage would be calamitous.”
About nine shares rose for every one that declined on MSCI’s Asia Pacific Index, helping the gauge rebound from a 1.6 percent weekly loss. Japan’s Nikkei 225 Stock Average increased 1.7 percent, South Korea’s Kospi index climbed 1.5 percent, while Australia’s S&P/ASX 200 Index added 1.4 percent.
Mitsubishi UFJ
Mitsubishi UFJ Financial Group Inc. rallied 4.1 percent after Japan’s biggest publicly traded bank said first-quarter profit tripled to a record. Of 257 companies in the Asia-Pacific gauge to have reported net income from July 11 through 9 a.m. Tokyo time today, 115 had surpassed analysts’ estimates while 88 had fallen short, according to data compiled by Bloomberg.
Macarthur Coal Ltd. rose 1.9 percent after saying BidCo has advised that it intends to make an offer for a controlling stake in the Australian coal producer.
The S&P 500 fell for a third straight month in July, the longest streak since 2008, amid speculation Republicans in the House would fail to reach a compromise with the Senate, controlled by Democrats, and Obama to boost the nation’s ability to borrow by an Aug. 2 deadline. That concern helped overshadow a second-quarter earnings reporting season in which per-share profits have exceeded analysts’ projections at 78 percent of S&P 500 companies that reported so far.
Treasuries Fall
Ten-year Treasuries surged last week, driving yields as low as 2.77 percent on July 29, the lowest level since Nov. 30, as investors retreated to the relative safety of U.S. government bonds. Yields increased four basis points to 2.84 percent today as the tentative agreement on the debt ceiling curbed investor demand for a haven.
IntercontinentalExchange Inc.’s Dollar Index, which measures the currency against six U.S. trading partners, fell in each of the past three weeks. The index has fallen 2.7 percent since July 11. The U.S. currency traded at 77.74 yen today from 76.76 yen on July 29 in New York, and bought 79.36 Swiss centimes, from 78.55 last week.
Both S&P and Moody’s Investors Service are weighing a reduction of the U.S. credit rating. The impasse has boosted the chance S&P will cut the U.S. credit rating from AAA within three months to 50 percent, the ratings company said last month.
Even if the country defaults on some obligations after Aug. 2 and pays bondholders, S&P said short- and long-term interest rates would rise by 0.50 percentage point and 1 point, respectively.
Last Week’s Slump
U.S. stocks fell five straight days, driving the S&P 500 down 3.9 percent to 1,292.28 for its biggest weekly decline in a year. The retreat brought the benchmark gauge closer to its average price of the last 200 days of about 1,285. A drop below that level could trigger further losses, according to analysts who study charts to make forecasts.
Stocks also fell last week after government reports showed orders for durable goods unexpectedly decreased and the U.S. economy grew less than forecast in the second quarter.
The Morgan Stanley Cyclical Index of companies most-tied to economic growth decreased 5.6 percent, the most in a week since July 2010. The Dow Jones Transportation Average had the biggest loss since August, falling 4.5 percent.
Crude for September delivery rose to $97.15 a barrel on the New York Mercantile Exchange, rebounding from a 4.2 percent plunge last week that drove prices to the lowest settlement in about two weeks. Brent oil jumped 0.9 percent to $117.80 a barrel on the London-based ICE Futures Europe exchange.
Gold for immediate delivery declined 1 percent to $1,612.45 an ounce after reaching an all-time high of $1,632.80 an ounce on July 29. Cash silver fell 0.5 percent to $39.70.
–With assistance from Julie Hirschfeld Davis and Heidi Przybyla in Washington. Editors: Michael P. Regan, Nick Gentle
To contact the reporters on this story: Shiyin Chen in Singapore at schen37@bloomberg.net; Rita Nazareth in New York at rnazareth@bloomberg.net.
To contact the editors responsible for this story: Nick Baker at nbaker7@bloomberg.net; Nick Gentle at ngentle2@bloomberg.net.
Stock Futures Climb, Dollar, Oil Gain as U.S. Nears Deal to Avoid Default
July 31, 2011
U.S. and Japanese stock futures surged, indicating equities may rebound from last week’s slump, and the dollar gained versus the yen and Swiss franc amid signs American lawmakers were close to an agreement to raise the federal debt limit and avoid a default
See the article here:
U.S. and Japanese stock futures surged, indicating equities may rebound from last week’s slump, and the dollar gained versus the yen and Swiss franc amid signs American lawmakers were close to an agreement to raise the federal debt limit and avoid a default. Oil rallied.
S&P 500 futures expiring in September advanced 1.1 percent to 1,305.4 at 8:07 a.m. in Tokyo. Dow Jones Industrial Average futures climbed 154 points, or 1.3 percent, to 12,242. Futures on Japan’s Nikkei 225 Stock Average also gained. The U.S. dollar strengthened 0.6 percent against the yen and Swiss franc. Crude oil for September delivery increased 1.2 percent to $96.82 a barrel in electronic trading.
U.S. Senate Majority Leader Harry Reid, a Democrat, and Mitch McConnell, the Senate Republican leader, voiced support for a tentative agreement with House leaders and President Barack Obama’s administration to raise the borrowing limit, paving the way for possible votes in both chambers. House Speaker John Boehner, a Republican from Ohio, was to brief rank- and-file Republicans, a Republican aide said.
“They are going to pull a rabbit out of the hat,” Jeffrey Saut, chief investment strategist at Raymond James & Associates in St. Petersburg, Florida, said in a telephone interview. His firm manages $275 billion. “The word default that’s being thrown around is being used inappropriately. I don’t think the U.S. in any way, shape or form is going to default. The collateral damage would be calamitous.”
Futures on the Nikkei 225 Stock Average expiring in September last traded at 9,955 in Chicago, compared with 9,840 in Osaka, Japan. The stock average sank 3 percent to 9,833.03 in the week ended July 29, its largest weekly slump since March.
Third Monthly Loss
The S&P 500 fell for a third straight month in July, the longest streak since 2008, amid speculation Republicans in the House would fail to reach a compromise with the Senate, controlled by Democrats, and President Barack Obama to boost the nation’s ability to borrow by an Aug. 2 deadline. That concern helped overshadow a second-quarter earnings reporting season in which per-share profits have exceeded analysts’ projections at 78 percent of S&P 500 companies that reported so far.
IntercontinentalExchange Inc.’s Dollar Index, which measures the currency against six U.S. trading partners, fell in each of the past three weeks. The index has fallen 2.8 percent since July 11.
‘Important Issues’
The agreement would raise the $14.3 trillion debt limit while cutting $1 trillion in spending and charging a special committee with proposing additional savings of up to $1.8 trillion, according to people familiar with the discussions. Still, White House Communications Director Dan Pfeiffer said in a Twitter message that the two sides have “important issues to work out.”
Unresolved issues include the final details of the enforcement mechanism designed to compel future deficit reduction, a Republican aide said, speaking on condition of anonymity.
Both S&P and Moody’s Investors Service are weighing a reduction of the U.S. credit rating. The impasse has boosted the chance S&P will cut the U.S. credit rating from AAA within three months to 50 percent, the ratings company said last month.
Even if the country defaults on some obligations after Aug. 2 and pays bondholders, S&P said short- and long-term interest rates would rise by 0.50 percentage point and 1 point, respectively. Ten-year Treasuries surged last week, driving yields as low as 2.77 percent on July 29, the lowest level since Nov. 30.
Last Week’s Slump
U.S. stocks fell five straight days, driving the S&P 500 down 3.9 percent to 1,292.28 for its biggest weekly decline in a year. The retreat brought the benchmark gauge closer to its average price of the last 200 days of about 1,285. A drop below that level could trigger further losses, according to analysts who study charts to make forecasts.
Stocks also fell last week after government reports showed orders for durable goods unexpectedly decreased and the U.S. economy grew less than forecast in the second quarter.
The Morgan Stanley Cyclical Index of companies most-tied to economic growth decreased 5.6 percent, the most in a week since July 2010. The Dow Jones Transportation Average had the biggest loss since August, falling 4.5 percent.
To contact the reporter on this story: Rita Nazareth in New York at rnazareth@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net
Deal or no deal? Markets bracing for Monday (AP)
July 31, 2011
Investors around the world remained on edge Sunday as Congress continued to work on a deal to raise the country’s borrowing limit and avoid a U.S.
Original post:
Investors around the world remained on edge Sunday as Congress continued to work on a deal to raise the country’s borrowing limit and avoid a U.S. debt default.
Japan’s benchmark Nikkei index is the first major stock market to open for trading, on Sunday at 8 p.m. Eastern time. But there’s already some evidence that investors believe a deal will be made before U.S. markets open Monday.
Shortly after Sen. Democratic leader Harry Reid said he had signed off on a deal reached late Sunday between the White House and Republican leaders, Dow futures were up 125 points, or 1 percent. Future contracts for the broader S&P 500 index rose 1.2 percent. When futures are up during off-hours trading, stocks typically rise when the market opens.
If a deal is reached to raise the borrowing limit, John Brady, a senior vice president for futures and options at MF Global said that the Standard & Poor’s 500 index could add 6 percent in the next few weeks.
“Stocks will rally, and stocks will rally big,” Brady said Sunday. “The markets are giving heavy odds that this deal is going to get done.”
A deal would remove a major source of something investors hate: Uncertainty. But there’s another reason the so-called relief rally might be a big one. Companies have reported strong earnings in recent days, but traders have been reluctant to buy stocks fearing the debt wrangling in Washington might set off a financial crisis.
If there is no agreement to raise the nation’s borrowing limit and defuse the building financial crisis, analysts said Sunday they expect stock markets across the globe to fall on Monday.
In the U.S. that would add to six straight days of stock losses. The Dow Jones industrial average fell 581 points, or 4.6 percent, in that time.
Brady predicts the S&P 500 could fall another 7 percent on Monday if a deal falls apart. The S&P closed at 1,292 on Friday and was down 3.9 percent last week. A loss that big could send the S&P down to 1,200, a level it hasn’t reached since last November.
The Treasury Department has said that after Tuesday the U.S. government won’t have enough money to meet all of its financial obligations if Congress does not raise the nation’s debt ceiling. If a deal is not reached, the Treasury Department will have to decide which bills to pay and which to delay. Among them: interest payments on bonds, salaries of federal employees, and Social Security payments to retirees. The Treasury Department has not indicated which payments will take priority if the debt ceiling is not raised.
Thomas Tzitzouris, head of fixed income research at Strategas Research Partners said Sunday that to avoid a steep decline, the market needs to at least see some progress toward a vote on a deal to raise the borrowing limit.
If not, he said: “That would be a double whammy. When (Congress says) there is progress and then there isn’t, that really spooks the market.”
That’s what happened last week when a series of proposals gave investors fleeting hope for a deal. That is, until one party or the other shot them down. Nearly every measure of market confidence fell last week as Aug. 2 approached. The price of gold rose 2 percent for the week. Many investors tend to buy gold — sending the price higher — when they aren’t confident about other investments. A measure of stock market volatility, the VIX, jumped 6 percent.
In turn, the yield on the 10-year Treasury sank to its lowest level of the year on Friday, 2.80 percent. Treasury yields fall when demand for them goes up. Demand tends to rise when investors are reluctant to put money in stocks. Treasury bonds have long been considered the world’s safest investment and are a top holding of the largest pension funds in the U.S., the Chinese government and millions of Americans who own mutual funds.
“If this issue can be taken out of the headlines and the focus on Washington can be redirected toward corporate earnings and economic fundamentals, the market will have removed a significant obstacle,” said Quincy Krosby, chief market strategist at Prudential Financial.
Corporate earnings have been strong so far for the second quarter. Many major U.S. companies have reported their earnings in the last three weeks and others such as consumer goods companies Procter & Gamble and Kraft Foods will report this week.
“When you look at corporate earnings, which are immune to politics, you see that companies have been knocking the cover off the ball,” said Douglas Cote, the chief market strategist at ING.
Despite weak economic growth in the U.S., corporations in the S&P 500 are on pace for record profits for the year. That’s largely because those companies now make nearly half of their revenues overseas.
Jack Ablin, chief investment officer at Harris Private Bank in Chicago, said even a tentative agreement should energize the markets on Monday_ “just for the resolution alone.”
“Any deal that forestalls a technical default is going to be greeted by at least a 200-point move to the upside on the Dow,” he said Sunday.
While plenty of other challenges loom ahead politically and economically, Ablin said the market already has built-in enough of a negative outlook to be able to absorb those bumps.
Among those challenges: A report Friday said that the U.S. economy grew at an annual rate of only 1.3 percent between April and June. This year, the economy has grown at its slowest pace since the recession ended in June 2009 — just 1.7 percent.
A debt deal that significantly cuts short-term government spending could further weaken the economy, experts say.
Analysts say companies won’t be ready to hire and invest in new projects until some other Washington issues are resolved, like the cost of health care legislation passed last year and financial reform legislation.
Mark Luschini, chief investment strategist, Janney Montgomery Scott investment firm in Philadelphia, expects a market rally once a deal is reached. But then he says attention would turn very quickly to the jobs report that will be released on Friday. Economists expect that it will show 110,000 jobs were added by employers in July, according to FactSet. That’s still well below the level that would indicate healthy job growth.
Analysts say if a deal is reached before Aug. 2, investors will chalk up the market-rattling debt drama as another example of ultimately harmless Washington theatrics.
If the current deal falls apart, however, they say politicians will have done lasting damage to the nation’s credibility. Over time, this could make U.S. government debt less desirable to the worldwide market. That, in turn, could raise the cost of borrowing for the U.S. government.
Some lawmakers expressed optimism that a deal could yet be reached Sunday. A number of other promising deals have fallen through in recent days. This has left investors frustrated at Washington for adding to the economic uncertainty by failing to reach a deal before the deadline became so close at hand.
Uri Landesman, the president of Platinum Partners, a New York hedge fund said Sunday that this crisis is worse for markets than any he has seen before. He says that’s because it comes at a time when the economy is weak and because Congress is much more divided that it was even during the financial crisis of 2008.
“There has been incredibly weak leadership all the way around,” Landesman said.
–AP Business Writer Dave Carpenter contributed to this report from Chicago.
Futures bounce as investors sense debt deal (Reuters)
July 31, 2011
NEW YORK (Reuters) – U.S.
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NEW YORK (Reuters) – U.S. stock index futures jumped at the start of electronic trading on Sunday evening as investors bet that lawmakers in Washington were set to reach a deal on raising the country’s debt limit.
Investors have long believed the debate in Washington would go down to the wire. That appeared to be the case as politicians said they were close to a last-ditch $3 trillion deal to raise the U.S. borrowing limit and avoid a potentially catastrophic default.
“The markets are definitely pricing in a deal,” said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey. “It is clear that an awful lot of movement is going on in Washington and that’s what markets are reacting to.”
S&P 500 futures rose 16 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 125 points, and Nasdaq 100 futures gained 31.75 points.
With two days remaining until the United States exhausts its ability to borrow money, legislators said a deal was becoming more likely, but they had some way to go before reaching agreement.
Wall Street closed its worst week in a year last week after five straight days of losses. Analysts said the oversold conditions had primed the market for a bounce.
“With the percentage of stocks over their own 10-day moving average at an oversold 12.9 percent, a short-term rally may be on the cards based on the arrival of some good news,” said Wayne Kaufman, chief market analyst at John Thomas Financial in New York.
“Our fear is that the issue could drag on longer than anyone thinks.”
The U.S. dollar received an early lift against the yen and Swiss franc in Asia-Pacific trade on Monday amid the reports that a deal on the U.S. debt wrangle was close.
Any relief rally could be short-lived, investors said, with other big risks present. A report on Friday showed U.S. economic growth in the first half was much slower than anticipated.
The United States could also face a downgrade to its gold-plated AAA sovereign debt rating, which could weigh on markets if that happens later in the year.
“Even if the debt ceiling is raised, all of the heavy lifting will be in front of us,” said Peter Kenny, managing director in institutional sales at Knight Capital Group in Jersey City, New Jersey.
“I think it’s an almost foregone conclusion that there is going to be a downgrade at some point.”
(Editing by Dale Hudson)
U.S. Stock Futures Rally on Debt Deal Hopes
July 31, 2011
Traders work on the floor of the New York Stock Exchange on July 29, 2011. Photographer: Richard Drew/AP Traders work on the floor of the New York Stock Exchange (NYSE) in New York on July 29, 2011.
Original post:
Traders work on the floor of the New York Stock Exchange on July 29, 2011. Photographer: Richard Drew/AP
Traders work on the floor of the New York Stock Exchange (NYSE) in New York on July 29, 2011. Photographer: Scott Eells/Bloomberg
U.S. stock-index futures rallied, indicating the Standard & Poor’s 500 Index may rebound from its worst weekly loss in a year, amid optimism lawmakers and President Barack Obama are close to an agreement to raise the federal debt limit and avoid a default.
S&P 500 futures expiring in September rallied 1.1 percent to 1,305.8 at 8:07 a.m. in Tokyo. Dow Jones Industrial Average futures climbed 158 points, or 1.3 percent, to 12,246. The U.S. dollar strengthened 0.6 percent against the yen and the Swiss franc. IntercontinentalExchange Inc.’s Dollar Index, which measures the currency against six U.S. trading partners, fell in each of the past three weeks.
Senate Majority Leader Harry Reid, a Democrat, and Mitch McConnell, the Senate Republican leader, voiced support for a tentative agreement with House leaders and the Obama administration to raise the borrowing limit, paving the way for possible votes in both chambers. House Speaker John Boehner was to brief rank-and-file Republicans, a Republican aide said.
“If there’s a true agreement, investors will feel emboldened to jump back into stocks,” said Jack Ablin, who oversees $55 billion as chief investment officer for Chicago- based Harris Private Bank. “We’ve had the potential for default looming over our heads. That’s one element of uncertainty that we will probably take off the table for right now.”
Third Monthly Loss
The S&P 500 posted a third straight monthly loss in July, the longest streak since 2008, amid speculation Republicans in the House would fail to reach a compromise with the Senate, controlled by Democrats, and President Barack Obama to boost the nation’s ability to borrow by an Aug. 2 deadline. That concern helped overshadow a second-quarter earnings season in which per- share profits have exceeded analysts’ projections at 78 percent of S&P 500 companies that reported so far.
The agreement would raise the $14.3 trillion debt limit while cutting $1 trillion in spending and charging a special committee with proposing additional savings of up to $1.8 trillion, according to people familiar with the discussions. Still, White House Communications Director Dan Pfeiffer said in a Twitter message that the two sides have “important issues to work out.”
Unresolved issues include the final details of the enforcement mechanism designed to compel future deficit reduction, a Republican aide said, speaking on condition of anonymity.
AAA at Stake
Both S&P and Moody’s Investors Service are weighing a reduction of the U.S. credit rating. The impasse has boosted to 50 percent the chance S&P will cut the U.S. credit rating from AAA within three months, the ratings company said last month.
Even if the country defaults on some obligations after Aug. 2 and pays bondholders, S&P said short- and long-term interest rates would rise by 0.50 percentage point and 1 point, respectively. Ten-year Treasuries surged last week, driving yields as low as 2.77 percent on July 29, the lowest level since Nov. 30.
U.S. stocks fell five straight days, driving the S&P 500 down 3.9 percent to 1,292.28 for its biggest weekly decline in a year. The retreat brought the benchmark gauge closer to its average price of the last 200 days of about 1,285. A drop below that level could trigger further losses, according to analysts who study charts to make forecasts.
Stocks also fell last week after government reports showed orders for durable goods unexpectedly decreased and the U.S. economy grew less than forecast in the second quarter.
The Morgan Stanley Cyclical Index of companies most-tied to economic growth decreased 5.6 percent, the most in a week since July 2010. The Dow Jones Transportation Average had the biggest loss since August, falling 4.5 percent.
To contact the reporter on this story: Rita Nazareth in New York at rnazareth@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net
5 Ways To Tap Ad Agency Funding (Mashable)
July 31, 2011
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency. For startups, selling advertising agencies on your technology can be fraught with difficulty.
See the article here:
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency. For startups, selling advertising agencies on your technology can be fraught with difficulty. As startups emerge from their development cycles, investors begin clamoring to get the prototype to market. What follows is a flurry of meetings with brand marketers and advertising agencies in an attempt to secure funding and a business application for the new product.
[More from Mashable: 5 Tips for Running Successful Cause Marketing Campaigns]
Many startups assume that their brilliant, game-changing products will sell themselves. It’s at this point that mistakes happen, destroying any chance of meaningful funding and exposure. As someone who’s been tasked with innovation on the agency side for years, and sat through countless meetings with startups, I’ve compiled a guide to make the most of each agency funding opportunity.
1. It’s Not About You, It’s About Them
This meeting is not about you and your idea. It’s about finding a practical and profitable business application for your product. To avoid that glazed-over look as your audience tunes out, do yourself a favor: help them help you. Do your research on the agency and its clients. Have a look at their video case studies. Make an attempt to understand their brands and business challenges. In the agency world, this is called working back to the creative brief. Figure out why your service is best-suited to help the agency or a particular client.
[More from Mashable: HOW TO: Choose the Right Office Space]
2. Focus the Conversation on User Experience and Agility
Your pitch should emphasize how your product or service was designed with the end-user’s needs in mind. Agencies need to know that your product is more than just a working piece of technology. You may even consider enlisting a UX designer to help with your pitch. Further, it’s critical that you show your ability to manage the product or technology in an agile and flexible manner during the build-out process. Be sure to mention this — it will go a long way in reassuring the agency that it has a real partner.
3. Demonstrate Measurement and Support Capabilities
Make sure you have a sophisticated measurement and accountability system embedded into your technology. Analytics are essential components of the agency business, so be sure to address the topic in your presentation. Also mention your team, however small, in your pitch. Even though you may be a small startup, you have to reassure the agency that you and your team will be able to see the project through to the end.
4. Meet with Key Decision-Makers, Avoid a Run-Around
Many constituents in the agency world have overlapping jobs. While meeting with the CEO or president is ideal, don’t neglect other important titles like the chief technology officer, innovation directors, emerging media directors and strategic planning directors. It can also be helpful to invite a specific account director (sometimes called business directors or management supervisors), as they often represent a direct budget connection, as well as the needs of a particular brand. Avoid the run-around by properly managing the follow-up. It’s important to persist corresponding with the agency in general, but also to identify the appropriate decision-making advocate who will become your agency partner.
5. Entertain Multiple Business Opportunities and Models
Explore the many innovative business models and opportunities in today’s marketing industry. The most straightforward method is piloting your service into a funded brand program. Be prepared to discuss the fees that make the investment worth your time and effort, as well as the costs you are willing to absorb to get the deal done.
Strategic partnerships can also help grow your business. Agencies can assemble many partners around a brand’s table. Look for in-kind opportunities within agencies, for example, high-value media and promotions which would otherwise be financially impossible to you. Lastly, some agencies are now investing in new technology and services as revenue-sharing deals or equity plays. Consider that many agencies could see you as a long-term investment. The important thing is to be prepared for any opportunity and keep an open mind.
Image courtesy of Flickr, George Jonathan
This story originally published on Mashable here.
5 Ways To Tap Ad Agency Funding (Mashable)
July 31, 2011
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency.
View post:
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency. For startups, selling advertising agencies on your technology can be fraught with difficulty. As startups emerge from their development cycles, investors begin clamoring to get the prototype to market. What follows is a flurry of meetings with brand marketers and advertising agencies in an attempt to secure funding and a business application for the new product.
[More from Mashable: 5 Tips for Running Successful Cause Marketing Campaigns]
Many startups assume that their brilliant, game-changing products will sell themselves. It’s at this point that mistakes happen, destroying any chance of meaningful funding and exposure. As someone who’s been tasked with innovation on the agency side for years, and sat through countless meetings with startups, I’ve compiled a guide to make the most of each agency funding opportunity.
1. It’s Not About You, It’s About Them
This meeting is not about you and your idea. It’s about finding a practical and profitable business application for your product. To avoid that glazed-over look as your audience tunes out, do yourself a favor: help them help you. Do your research on the agency and its clients. Have a look at their video case studies. Make an attempt to understand their brands and business challenges. In the agency world, this is called working back to the creative brief. Figure out why your service is best-suited to help the agency or a particular client.
[More from Mashable: HOW TO: Choose the Right Office Space]
2. Focus the Conversation on User Experience and Agility
Your pitch should emphasize how your product or service was designed with the end-user’s needs in mind. Agencies need to know that your product is more than just a working piece of technology. You may even consider enlisting a UX designer to help with your pitch. Further, it’s critical that you show your ability to manage the product or technology in an agile and flexible manner during the build-out process. Be sure to mention this — it will go a long way in reassuring the agency that it has a real partner.
3. Demonstrate Measurement and Support Capabilities
Make sure you have a sophisticated measurement and accountability system embedded into your technology. Analytics are essential components of the agency business, so be sure to address the topic in your presentation. Also mention your team, however small, in your pitch. Even though you may be a small startup, you have to reassure the agency that you and your team will be able to see the project through to the end.
4. Meet with Key Decision-Makers, Avoid a Run-Around
Many constituents in the agency world have overlapping jobs. While meeting with the CEO or president is ideal, don’t neglect other important titles like the chief technology officer, innovation directors, emerging media directors and strategic planning directors. It can also be helpful to invite a specific account director (sometimes called business directors or management supervisors), as they often represent a direct budget connection, as well as the needs of a particular brand. Avoid the run-around by properly managing the follow-up. It’s important to persist corresponding with the agency in general, but also to identify the appropriate decision-making advocate who will become your agency partner.
5. Entertain Multiple Business Opportunities and Models
Explore the many innovative business models and opportunities in today’s marketing industry. The most straightforward method is piloting your service into a funded brand program. Be prepared to discuss the fees that make the investment worth your time and effort, as well as the costs you are willing to absorb to get the deal done.
Strategic partnerships can also help grow your business. Agencies can assemble many partners around a brand’s table. Look for in-kind opportunities within agencies, for example, high-value media and promotions which would otherwise be financially impossible to you. Lastly, some agencies are now investing in new technology and services as revenue-sharing deals or equity plays. Consider that many agencies could see you as a long-term investment. The important thing is to be prepared for any opportunity and keep an open mind.
Image courtesy of Flickr, George Jonathan
This story originally published on Mashable here.
5 Ways To Tap Ad Agency Funding (Mashable)
July 31, 2011
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency.
Read more here:
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency. For startups, selling advertising agencies on your technology can be fraught with difficulty. As startups emerge from their development cycles, investors begin clamoring to get the prototype to market. What follows is a flurry of meetings with brand marketers and advertising agencies in an attempt to secure funding and a business application for the new product.
[More from Mashable: 5 Tips for Running Successful Cause Marketing Campaigns]
Many startups assume that their brilliant, game-changing products will sell themselves. It’s at this point that mistakes happen, destroying any chance of meaningful funding and exposure. As someone who’s been tasked with innovation on the agency side for years, and sat through countless meetings with startups, I’ve compiled a guide to make the most of each agency funding opportunity.
1. It’s Not About You, It’s About Them
This meeting is not about you and your idea. It’s about finding a practical and profitable business application for your product. To avoid that glazed-over look as your audience tunes out, do yourself a favor: help them help you. Do your research on the agency and its clients. Have a look at their video case studies. Make an attempt to understand their brands and business challenges. In the agency world, this is called working back to the creative brief. Figure out why your service is best-suited to help the agency or a particular client.
[More from Mashable: HOW TO: Choose the Right Office Space]
2. Focus the Conversation on User Experience and Agility
Your pitch should emphasize how your product or service was designed with the end-user’s needs in mind. Agencies need to know that your product is more than just a working piece of technology. You may even consider enlisting a UX designer to help with your pitch. Further, it’s critical that you show your ability to manage the product or technology in an agile and flexible manner during the build-out process. Be sure to mention this — it will go a long way in reassuring the agency that it has a real partner.
3. Demonstrate Measurement and Support Capabilities
Make sure you have a sophisticated measurement and accountability system embedded into your technology. Analytics are essential components of the agency business, so be sure to address the topic in your presentation. Also mention your team, however small, in your pitch. Even though you may be a small startup, you have to reassure the agency that you and your team will be able to see the project through to the end.
4. Meet with Key Decision-Makers, Avoid a Run-Around
Many constituents in the agency world have overlapping jobs. While meeting with the CEO or president is ideal, don’t neglect other important titles like the chief technology officer, innovation directors, emerging media directors and strategic planning directors. It can also be helpful to invite a specific account director (sometimes called business directors or management supervisors), as they often represent a direct budget connection, as well as the needs of a particular brand. Avoid the run-around by properly managing the follow-up. It’s important to persist corresponding with the agency in general, but also to identify the appropriate decision-making advocate who will become your agency partner.
5. Entertain Multiple Business Opportunities and Models
Explore the many innovative business models and opportunities in today’s marketing industry. The most straightforward method is piloting your service into a funded brand program. Be prepared to discuss the fees that make the investment worth your time and effort, as well as the costs you are willing to absorb to get the deal done.
Strategic partnerships can also help grow your business. Agencies can assemble many partners around a brand’s table. Look for in-kind opportunities within agencies, for example, high-value media and promotions which would otherwise be financially impossible to you. Lastly, some agencies are now investing in new technology and services as revenue-sharing deals or equity plays. Consider that many agencies could see you as a long-term investment. The important thing is to be prepared for any opportunity and keep an open mind.
Image courtesy of Flickr, George Jonathan
This story originally published on Mashable here.
5 Ways To Tap Ad Agency Funding (Mashable)
July 31, 2011
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency.
The rest is here:
David Rosenberg is Director of Innovation at LBi in the U.S., the world’s leading independent global marketing and technology agency. For startups, selling advertising agencies on your technology can be fraught with difficulty. As startups emerge from their development cycles, investors begin clamoring to get the prototype to market. What follows is a flurry of meetings with brand marketers and advertising agencies in an attempt to secure funding and a business application for the new product.
[More from Mashable: 5 Tips for Running Successful Cause Marketing Campaigns]
Many startups assume that their brilliant, game-changing products will sell themselves. It’s at this point that mistakes happen, destroying any chance of meaningful funding and exposure. As someone who’s been tasked with innovation on the agency side for years, and sat through countless meetings with startups, I’ve compiled a guide to make the most of each agency funding opportunity.
1. It’s Not About You, It’s About Them
This meeting is not about you and your idea. It’s about finding a practical and profitable business application for your product. To avoid that glazed-over look as your audience tunes out, do yourself a favor: help them help you. Do your research on the agency and its clients. Have a look at their video case studies. Make an attempt to understand their brands and business challenges. In the agency world, this is called working back to the creative brief. Figure out why your service is best-suited to help the agency or a particular client.
[More from Mashable: HOW TO: Choose the Right Office Space]
2. Focus the Conversation on User Experience and Agility
Your pitch should emphasize how your product or service was designed with the end-user’s needs in mind. Agencies need to know that your product is more than just a working piece of technology. You may even consider enlisting a UX designer to help with your pitch. Further, it’s critical that you show your ability to manage the product or technology in an agile and flexible manner during the build-out process. Be sure to mention this — it will go a long way in reassuring the agency that it has a real partner.
3. Demonstrate Measurement and Support Capabilities
Make sure you have a sophisticated measurement and accountability system embedded into your technology. Analytics are essential components of the agency business, so be sure to address the topic in your presentation. Also mention your team, however small, in your pitch. Even though you may be a small startup, you have to reassure the agency that you and your team will be able to see the project through to the end.
4. Meet with Key Decision-Makers, Avoid a Run-Around
Many constituents in the agency world have overlapping jobs. While meeting with the CEO or president is ideal, don’t neglect other important titles like the chief technology officer, innovation directors, emerging media directors and strategic planning directors. It can also be helpful to invite a specific account director (sometimes called business directors or management supervisors), as they often represent a direct budget connection, as well as the needs of a particular brand. Avoid the run-around by properly managing the follow-up. It’s important to persist corresponding with the agency in general, but also to identify the appropriate decision-making advocate who will become your agency partner.
5. Entertain Multiple Business Opportunities and Models
Explore the many innovative business models and opportunities in today’s marketing industry. The most straightforward method is piloting your service into a funded brand program. Be prepared to discuss the fees that make the investment worth your time and effort, as well as the costs you are willing to absorb to get the deal done.
Strategic partnerships can also help grow your business. Agencies can assemble many partners around a brand’s table. Look for in-kind opportunities within agencies, for example, high-value media and promotions which would otherwise be financially impossible to you. Lastly, some agencies are now investing in new technology and services as revenue-sharing deals or equity plays. Consider that many agencies could see you as a long-term investment. The important thing is to be prepared for any opportunity and keep an open mind.
Image courtesy of Flickr, George Jonathan
This story originally published on Mashable here.
