Money & Politics --- Mike (fast)
NYSE --- Deb (fast)
>> i’m michael mckee. welcome back to “money & politics.” what goes up may be because of what goes down. stocks finishing the day higher. the dow jones industrials closing up 59 points. the s&p 500 up by eight and nasdaq higher by nine. credit for at least part of the advance goes to a drop in oil prices. crude falling 51 cents in new york trading today, ahead of tomorrow’s inventory report, the department of energy forecasts the report to show stockpiles rose last week. the market posted a gain for the day on tuesday as interest-rate-sensitive stocks among the biggest gainers. deborah kostroun explains why that is.
>> thanks a lot, mike. what we did see, the dow jones industrial average, it did close higher, not on our best level of the day but we were in rally mode a little bit. the thing that traders took away from today was the fact that fed officials really suggesting tame inflation. as that was the big takeaway, it gives us the idea that maybe they won’t have to raise rates beyond 5%. but something that was a little bit surprising that we did see, treasuries falling once again, the 10-year yields trading near four-year high, right about 4.87%. you have to remember, yesterday, they were at 4.9%, so, typically, we don’t see a situation where you have stocks going higher as yields are going higher but we did see that in today’s session. we also saw the interest-rate-sensitive stocks gaining because the outlook, if the fed is talking about tame inflation, maybe that means we’ll have a more stable outlook for interest rates. all those interest-rate-sensitive stocks that have been maybe not performing all so well over the past week or so, really were some of the best performers today, like the financials, the banks and utilities. of course, crude oil dropping to $66.23 a barrel, taking the edge off, lifting the retailers. if you look at utilities, utilities among the biggest gainers in the s&p 500 today. however, down almost 1% so far this year because it had so much pressure because of the outlook on yields has been a question mark. a.e.s. saying fourth-quarter profit rising 75% on higher electricity rates in brazil and argentina. we saw a record in the amex broker/dealer index. once again, another area of the market that’s interest-rate-sensitive but the index is up 19% and many of the broker/dealers coming in with records on the day. also bank stocks, over the past week bank stocks have not been great performers but today they were up there as once again it looks like bond yields could be becoming more stable. switching gears away from the interest-rate-sensitive stocks, international paper saying it’s going to sell more than five million acres of timberland for a record $6 billion. international paper using cash to pay down debt and invest in other businesses. back to you.
>> deborah kostroun at the new york stock exchange. wal-mart will be adding 50 stores in urban areas with high unemployment. the world’s largest retailer says it will also help local businesses around those locations thrive once the discount chain moves in. the new stores will be located in vacant buildings or malls and on sites that are environmentally contaminated in part of a revitalization effort. the company says its 50 new stores will create about 25,000 new jobs. wal-mart is also creating 10 urban job zones to help local businesses, the first on chicago’s west side. on today’s “money & politics,” we’ll ask i.m.f. managing director―coming up next, raising concerns about the u.s. budget deficit, former federal reserve vice chair alice rivlin when “money & politics” continues.
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Listen Money & Politics --- Lizzy (slow)
>> another washington figure reportedly on his way out got a vote of confidence today. president bush coming to the defense of treasury secretary john snow. stories reporting on snow’s imminent replacement have been circulating in the capitol before the president’s re-election and picked up again this week. mr. bush praised his treasury secretary.
>> he has been a valuable member of my administration and i trust his judgment and appreciate his service. i’ve, as you know, accepted the resignation of andrew card, my long-time friend, a person who will go down in the annals as one of the really fine chiefs of staff in the history of the white house. i’ve asked josh bolten to take his place. josh has served us very well as the director of the office of management and budget. i told josh that we will organize the white house in such a way that he is comfortable with and it meets my needs.
>> the president did stop short of saying snow will remain on the job and at least one republican with close ties to the white house telling bloomberg yesterday he thinks the rumors will turn out to be true. now has never directly addressed his future, saying only that he serves at the pleasure of the president. one man who won’t be taking the job, morgan stanley chief executive john mack. mack, who just took over at morgan stanley last year, told his staff today he’s not interested in becoming treasury secretary. he’ll remain at the investment bank. some of america’s largest utilities are asking congress for more regulation. they told a senate hearing on climate change they’re willing to accept greater restrictions on emissions of carbon monoxide. lizzy o’leary has more.
>> climate change has never been an easy topic in congress and energy committee chairman pete domenici opened today’s session by saying consensus on emissions rules could be hard to find.
>> designing and implementing a mandatory system will be difficult politically and economically.
>> but domenici said today could be a starting point. analysts say they don’t expect congress to pass climate change laws this year.
>> this hearing is greemly important because it asks the question, if we did, who would get hurt and so senators domenici and bingaman turned to the industry and said, why don’t you design it?
>> companies like southern opted for voluntary technology improvements like those favored by the white house. some utilities broke with their own trade association and called for mandatory restrictions on carbon monoxide.
>> it is critical that we start now. we need economic and regulatory certainty in order to invest in low carbon energy future.
>> the committee also heard differing views on whether emissions rules should be economy-wide or vary by sector. lizzy o’leary, bloomberg news.
>> tomorrow, president bush’s chief adviser on climate change will speak to the senate commerce committee. when we return, scanning cargo for rogue nukes and checking up on banks and terrorism finance. “political notes” are next. stay with us.
