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With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Dodd's Departure; Cybersitter Files Suit; ADP: Service Sector Added Jobs in Dec.; Harley's Hogs to Rumble in India; GMAC to Post Record Loss; Markman Calls Dow Surge
- U.S. Sen Christopher Dodd, D-CT, said yesterday (Wednesday) that he will not seek re-election in November, potentially altering the debate over financial reform. Dodd, who is chairman of the Senate Banking Committee, in November released an 1,136-page draft bill for reform that would create several new protection agencies, increase regulation of credit agencies and derivatives, and alter the role played by the U.S. Federal Reserve in the financial system. However, analysts say that without having to worry about re-election, Dodd is likely to be more willing to compromise on objections raised by Republicans and the financial services industry." Even if Dodd wanted to get tougher, he does not have the votes to do it," Jaret Seiberg, an analyst with Concept Capital, told The Wall Street Journal. "That means compromising to get the Dodd-Shelby-Frank Financial Reform bill enacted."
- Cybersitter LLC, a California software company, has sued two Chinese technology firms, accusing them of stealing its computer code to create the Internet-monitoring program known as Green Dam. Cybersitter is claiming $2.2 billion in damages for all 56.5 million copies of the software distributed in China as of early June 2009. In addition to the China-based Lenovo Group Ltd. (OTC ADR: LNVGY) and Haier Group, the suit names as defendants Sony Corp. (NYSE ADR: SNE) and Toshiba Corp. (PINK: TOSBF), and Taiwan-based Acer Inc., Asustek Computer Inc., and BenQ Corp for helping disseminate the pirated software.
- U.S. private-sector jobs fell by 84,000 in December – the smallest drop since March 2008 – and service providers added jobs, according to a national employment report published yesterday (Wednesday) by payroll company Automatic Data Processing Inc. (Nasdaq: ADP). The estimated change of employment from October to November was revised by 24,000, from a decline of 169,000 to a decline of 145,000. Service-sector jobs added jobs, by 12,000, the first increase since March 2008, while factory jobs dropped 43,000, the report said.
- Harley-Davidson Inc. (NYSE: HOG) will break into the fast-moving Indian motorcycle market by introducing 12 models from its 2010 lineup to the subcontinent. Indian dealerships will start taking orders in April with deliveries beginning in June. India's motorcycle market is the world's second largest behind China. Hero Honda Motors Ltd. – a joint venture between Japan's Honda Motor Co. (NYSE ADR: HMC) and India's Hero Group – is the market leader in motorcycle sales with 1.2 million motorcycles and scooters sold in the July-September period.
- Even though it has been the recipient of three taxpayer bailouts, GMAC LLC said it expects to post a record fourth-quarter loss of $5 billion. GMAC last week raised $3.8 billion by selling preferred securities to the government, giving taxpayers a 56% stake in GMAC. The company also said it has decided to try to sell its ResCap mortgage unit, which has lost billions of dollars since the U.S. housing market crashed. The finance company lost more than $5 billion in the first nine months of 2009 and has lost money in six of the past seven quarters – including two quarters in 2008 in which it lost at least $2.5 billion. It received $7.5 billion from the government at the end of 2008 and $6 billion in the middle of last year.
- Shares of The Dow Chemical Co. (NYSE: Dow) the nation's largest chemical company, yesterday (Wednesday) rose 83 cents, or 2.7%, to close at $31.30 in afternoon trading. Earlier, shares reached a new 52-week high of $31.66. Money Morning Contributing Writer Jon Markman recommended Dow in a Dec. 29 article. "Within the materials sector one particular stock has caught my eye: The Dow Chemical Co.," said Markman. "This is the type of mega-cap stock that isn't just a toy of hot-shot hedge fund prop desk traders. This is a tough, center-of-the-economy, bare-chested-with-tattoos kind of stock. It's not very volatile. It's not easily pushed around. But once it gets going, it puts together long strings of consecutive up closes. Right now, it's going higher."