10:54 (Dow Jones) Urea prices fell sharply last week, which is bad for fertilizer companies, Citigroup says, and downgrades Terra Industries (TRA), CF Industries (CF) and Agrium (AGU) to hold from buy. US urea prices reached as low as $575/ton, down from $705/ton last week, Citigroup says, citing trade press. The risk is buyers will delay purchases and draw down inventories deeper than usual in anticipation of even lower prices. How long that takes to play out is nearly impossible to predict or quantify, firm says, but could take weeks or months to play out. TRA down 20%, CF down 18%, AGU down 12%. (EBW)
10:47 (Dow Jones) Colombian stocks fall, with the IGBC down 0.9% to 9344 amid fears the US Congress won't approve a bailout program. "During a US presidential year, it seems pretty difficult to approve the bailout plan. That increases the risks that other banks may go bankrupt," says Daniel Escobar, head of research at local brokerage Gesvalores. Meanwhile, the peso appreciates to COP2,085 from COP2,094 yesterday. In the local bond market, the yield on the benchmark domestic paper maturing in 2020 trades at 11.980% from 11.905% yesterday. (DMD)
10:42 (Dow Jones) Morgan Stanley's CEO John Mack is keeping employees abreast of "key initiatives" the firm is working on, and sent out a update letter to employees this morning. Mack says the Mitsubishi UFJ Financial platform, which Morgan recently partnered with, "will be invaluable as we transition our business under our new bank-holding company structure." Mack also says planning is "moving ahead" regarding new bank status. He ends the letter by stating "all of us need to make sure our clients continue to understand how Morgan Stanley's unique market position, strong liquidity with full and permanent access to the Fed window, industry-leading Tier-1 capital ration, and unrivaled global platform can help then in these uncertain times." (JXP)
10:38 (Dow Jones) Overnight repo market calms down a bit as traders find it easier to borrow Treasurys and the cost of borrowing eases back a bit. The repo rate for non-specific Treasurys, the so-called GC (general collateral) repo rate, is 1.75%, rebounding from below 1% a day earlier. The rate is above the traded fed-funds rate of 1.25% while below the 2% fed-funds target rate. Still, some specific Treasurys are in high demand. The five-year notes are most sought- after, with the lowest repo rate of 0.05%, followed by the two-year notes, with repo rate of 0.25% and 30-year Treasurys, with repo rate of 0.9%. (MOZ)
10:30 (Dow Jones) After three weeks of small improvements, growth in a leading economic indicator worsened in the week of Sept. 19. Growth in the ECRI leading index weakened to -12.3%, from -11.5% in prior week. "With WLI growth falling to a fresh 28-year low, it is clear that the recession will not end any time soon, regardless of actions taken by Washington," ECRI director Lakshman Achuthan says. Growth in the monthly index worsened to -11.8%, from -9.3% in prior month. (KGM)
10:28 (Dow Jones) The Wall Street mayhem threatens IT spending at big-name financial firms, but things could be much worse, Eric Krangel writes at Silicon Alley Insider, citing Forrester Research. The business from troubled firms like Lehman, Merrill and AIG make up only about 2% of total IT spending, and even in in the case of mergers there's integration needs and the like. "The work to get technology and enterprise systems like general ledger and human resources under the same umbrella can be a bonanza for tech consulting firms," Krangel writes. The biggest risk to IT spending, Forrester said, isn't a Wall Street collapse but a US recession. (KPV) (http://www.alleyinsider.com/2008/9/wall-street-s- blowup-shrinks-the-tech-market-by-billions-could-be-worse)
10:20 (Dow Jones) Brazilian meatpacker Perdigao (PDA) won't suffer the same forex losses rival Sadia (SDA) announced late yesterday, PDA says. Sadia announced it lost 760 Brazilian reals ($411 million) on forex futures contracts. Perdigao has exposure to about $552 million in its balance sheet to debt instruments, which at current exchange levels would mean a loss of BRL140 million to BRL150 million, Credit Suisse said. (AST)
10:14 (Dow Jones) Fox-Pitt upgrades JPMorgan (JPM) to outperform on what it calls its "very attractive deal" for WaMu (WM) - it allows JPM to buy the sixth- largest US depository at essentially no deposit premium, fills gaps in branch penetration in key western and southern markets and makes JPM the largest depository in US, "thus extending its source of cheap and stable funding at a time when markets are obsessing about this." The deal does carry some short-term risk under JPM's estimate that in the event of a severe recession, losses in WM's portfolio would increase by $18B, but Fox-Pitt believes longer-term benefits outweigh the risk. JPM up 0.4% at $43.62. (EBW)
10:11 (Dow Jones) Watching the equities market open, and while stocks are down, it at least looks like equities investors aren't panicking. And there likely won't be so long as any talks continue down in Washington. Central bank liquidity injections are helping juice credit markets ever so slightly. Reuters/ Univ of Michigan sentiment report helps equities a bit. All 10 of the S&P 500's industry sectors are down, with materials, energy, financials the worst. On the Dow, most components are down, with Chevron, Amex, IBM leading decliners; BofA, H-P lead the few gainers. DJIA down 77, S&P 500 down 15, Nasdaq Comp down 32. ( PJV)
10:06 (Dow Jones) Given all the tumult going on right now, an assessment of the economy is not that high on most investors' list. Still, St. Louis Fed President James Bullard would like to remain you that inflation remains high and volatile, although he's optimistic softer oil prices will help the economy out. "Financial market turmoil has recently been severe, and the consequences of this turmoil on real economic performance entail clear downside risk," he says in a speech. "If financial market turmoil can be contained, the FOMC can turn attention to achieving better inflation results than those recently experienced." (MSD)
(END) Dow Jones Newswires 09-26-08 1054ET Copyright (c) 2008 Dow Jones & Company, Inc.
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