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Spotlight Stocks: Ambac, Merrill, Toyota, XTO

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Wednesday's top stories and stocks with potential to move.

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Stocks to watch for Wednesday, June 11, 2008:

  • Ambac's (ABK) and MBIA's (MBI) recent downgrades by Moody's and S&P caught Wall Street executives off guard, reported the Financial Times. The execs said they weren't expecting the downgrades for several months. Now the banks could face further write-downs of up to $10 billion as a result of the monoline ratings cuts.
  • Merrill Lynch (MER) won a summary judgment from a New York federal judge in a case with a unit of bond insurer Security Capital Assurance involving as much as $3.1 billion in credit-default swaps, reported The Wall Street Journal. Merrill Lynch International had alleged the SCA unit improperly issued notices that it would terminate seven credit-default swaps "without any basis and under a pretext based entirely on rank speculation," after entering into the binding contracts, the Journal said.
  • Toyota's (TM) battery joint venture, Matsushita Electric Industrial, will begin production on longer-lasting lithium-ion batteries in 2009, as part of an effort to roll out more electric cars, reported Reuters. The company is aiming to lower costs as it produces the types of vehicles that are becoming largely in demand amid rising fuel prices. Full-scale production of lithium-ion batteries would start in 2010.
  • XTO Energy (XTO) has said it will purchase Hunt Petroleum for $4.19 billion in cash and stock, more than doubling the company's next largest acquisition this year, said The Wall Street Journal. XTO will pay $2.6 billion in cash and about $1.6 billion in XTO common stock. The deal is expected to close in early September.


Market Recap

  • Asian trading closed with the Hang Seng -0.21%, Nikkei +1.16%, Sensex +1.99%, Taiwan -0.29% and Shanghai -1.57%.
  • A quick check of Europe finds the CAC +0.14%, DAX +0.06%, FTSE +0.06%, ATX +0.28%, Swiss Mkt. -0.16% and Stockholm +0.07%.
  • In commodities, crude oil is higher +2.21 to 133.43 and gold is also up +3.9 to 871.8 this morning.
No positions in stocks mentioned.

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