Chinese Government Hasn't Decided on $40 Billion Agricultural Bank Bailout

(Bloomberg) -- Central Huijin Investment Co., a
government investment arm, said it hasn't decided on the bailout
of Agricultural Bank of China, weakest of the four-biggest
state-owned banks, according to a senior official.

Beijing-based Agricultural Bank may receive a $40 billion
capital injection from Huijin, the Economic Observer newspaper
reported today, without citing anyone.


Read more at Bloomberg Emerging Markets News

Mortgage fallout, economic data weigh on Wall St

(Reuters) - Standard & Poor's said it changed its ratings outlook on Bear Stearns, the biggest U.S. underwriter of mortgage bonds, to "negative" from "stable," indicating there is a better chance of a downgrade over the next two years.




"People are very concerned. They do not know how deep these loan problems are and how it will affect the economy," said William Lefkowitz, options strategist at brokerage firm vFinance Investments in New York.


Read more at Reuters.com Hot Stocks News

Radian-Backed U.S. Municipal Bonds Face Possible Cut in Ratings by Fitch

(Bloomberg) -- Fitch Ratings put 934 municipal bond
issues insured by a Radian Asset Assurance Inc. under review for
a possible ratings cut following losses by its parent on an
investment in a subprime mortgage lender.

Radian Group Inc. and MGIC Investment Corp., which
announced plans in February to merge, yesterday said their
combined stakes of more than $1 billion in Credit-Based Asset
Servicing and Securitization may be worthless. Radian Asset
Assurance is rated AA, while Radian Group is ranked A.


Read more at Bloomberg Bonds News

US STOCKS-U.S. stocks fall as credit worries return

(Reuters) - NEW YORK, July 31 - U.S. stock indexes fell on
Tuesday, giving up earlier earnings-driven gains as worries
about the deteriorating credit market resurfaced.




American Home Mortgage Investment Corp. was the
latest casualty of the housing slump. The mortgage lender said
it can't fund home loans and may have to liquidate.


Read more at Reuters.com Bonds News

U.S. Swaptions Interest Rate Volatility Falls as Perceived Bond Risk Eases

(Bloomberg) -- Volatility on options on interest-
rate swaps fell from a 17-month high for a second day as the
perceived risk of owning corporate bonds declined.

The risk of holding corporate debt dropped by the most in
at least three years after home lender GMAC LLC said subprime
mortgage losses narrowed and Citadel Investment Group LLC said
yesterday that it bought the assets of a failed hedge fund.


Read more at Bloomberg Currencies News

Dow Jones, Graham, Ingersoll and Rural Cellular: U.S. Equity Movers Final

(Bloomberg) -- The following is a list of companies
whose shares had unusual price changes in U.S. exchanges. Stock
symbols are in parentheses after company names. Share prices are
as of 4 p.m. in New York.

Some mortgage lenders fell after American Home Mortgage
Investment Corp. (AHM US) delayed its quarterly dividend and
raised doubts about whether it has enough cash to stay in
business. Shares of American Home were halted.


Read more at Bloomberg Stocks News

CNA, Dow Jones, Ingersoll, RadioShack, Rural Cellular: U.S. Equity Movers

(Bloomberg) -- The following is a list of companies
whose shares are having unusual price changes in U.S. exchanges.
Stock symbols are in parentheses after company names. Share
prices are as of 2:40 p.m. in New York.

Some mortgage lenders fell after American Home Mortgage
Investment Corp. (AHM US) delayed its quarterly dividend and
raised doubts about whether it has enough cash to stay in
business. Shares of American Home were halted.


Read more at Bloomberg Stocks News

UPDATE 1-Hedge fund Citadel takes over Sowood's credit fund

(Reuters) - BOSTON, July 30 - Hedge fund Citadel Investment
Group, LLC said on Monday that it took over Sowood Capital's
credit portfolio following speculation last week that heavy
losses might force the smaller hedge fund to shut down.




Chicago-based Citadel, which manages $14 billion, came to
the rescue after Boston-based Sowood, which managed $3 billion,
got into trouble with bond trades this summer. Rumors that
Sowood might be forced to shut down roiled financial markets
late last week.


Read more at Reuters.com Bonds News

U.S. Stocks Rebound on Upgrades; KB Home, Nordstrom, Terex Shares Advance

(Bloomberg) -- U.S. stocks rebounded, pacing a
global advance, after Wall Street brokerages told investors to
buy shares that fell during last week's $2.1 trillion global
sell-off.

KB Home led homebuilders higher after Citi Investment
Resarch raised the shares to ``buy.'' Nordstrom Inc. posted its
steepest gain since August on a Goldman, Sachs & Co. upgrade.
Terex Corp., the maker of trucks and cranes, surged the most in
three weeks and led the Standard & Poor's 500 Index higher
after Goldman, Sachs & Co. advised clients to buy the shares.


Read more at Bloomberg Stocks News

South Korea's Stocks Slide on U.S. Housing Concern; Kookmin Bank Drops

(Bloomberg) -- South Korean stocks fell for the
third day. Kookmin Bank led declines on concern a deepening U.S.
housing slump will slow the world's biggest economy and prompt
investors to shun equities for safer assets.

``The housing-market problems may have a bigger-than-
expected damping effect on the U.S. economy,'' said Kim Han Jin,
vice president of Fides Investment Management in Seoul, which
manages $1 billion in equities. ``That could continue if consumer
spending fails to offset those negatives,'' while ``people want
to cut their holdings of riskier assets in emerging markets,'' he
said.


Read more at Bloomberg Stocks News

TIPS, A Bad Tip on Inflation in 2006, Lose Value as Oil Closes In on $100

(Bloomberg) -- Treasury investors say inflation is
abating, even if the oil bulls are right and crude heads to $100
a barrel.

Pacific Investment Management Co. and Fidelity Investments
sold Treasury inflation-protected securities maturing next year,
confident that consumer prices will remain in check. Money
managers lost as much as $275 million on so-called TIPS in the
second half of 2006 because oil fell from record highs and
gasoline prices dropped.


Read more at Bloomberg Bonds News

Corporate Bond Risk Decreases as Investors Reduce Bets on Subprime Rout

(Bloomberg) -- The risk of owning corporate bonds
fell in Europe and the U.S. as investors pared bets that credit
quality will deteriorate further because of the subprime
mortgage rout, according to traders of credit-default swaps.

Contracts on 10 million euros ($13 million) of debt
included in the iTraxx Crossover Series 7 Index of 50 European
companies dropped 13,000 euros to 354,000 euros in London,
according to Deutsche Bank AG. The index was at 180,000 euros at
the start of June. The CDX North America Investment Grade Index
dropped $1,250 to $53,750 in New York, Deutsche Bank said.


Read more at Bloomberg Bonds News

UPDATE 1-Subprime mess spreading to junk bonds-PIMCO's Gross

(Reuters) - A lack of confidence has "frozen" the markets for lending
and backed up new junk-bond offerings, and the tide appears to
be going out for leveraged equity investors, Gross, manager of
the world's largest bond fund at Pacific Investment Management
Co., or PIMCO, said in an August investment outlook letter.




Gross also said the U.S. economy will come under pressure
from increased cost of financing.


Read more at Reuters.com Bonds News

Caterpillar, Google, Intuitive Surgical, Kinetic, Pall: U.S. Equity Movers

(Bloomberg) -- The following is a list of companies
whose shares are having unusual price changes in U.S. exchanges
today. Stock symbols are in parentheses after company names.
Share prices are as of 10:10 a.m. New York time.

American Home Mortgage Investment Corp. (AHM US) rose 58
cents, or 5.4 percent, to $11.34. Shares of American Home, which
specializes in adjustable rate mortgages, plunged yesterday on
speculation its credit facilities might be pulled. Analysts at
JMP Securities and RBC Capital Markets said the company is not in
danger of losing its credit lines from Wall Street firms.


Read more at Bloomberg Stocks News

Corporate Bond Risk Rises in Europe, U.S. After Subprime Index Selloff

(Bloomberg) -- The risk of owning U.S. and European
corporate bonds rose today after indexes of securities linked to
U.S. subprime mortgages slumped to a record low, according to
traders of credit-default swaps.

Contracts based on 10 million euros ($13 million) of debt
included in the iTraxx Crossover Index of 50 European companies
jumped 18,500 euros to 286,000 euros at 1:52 p.m. in London,
according to JPMorgan Chase & Co. The CDX North America
Investment-Grade Index of 125 companies rose $1,750 to an offered
price of $45,750 at 8:50 a.m. in New York, Deutsche Bank AG
prices show. An increase in the indexes suggests deterioration in
the perception of credit quality.


Read more at Bloomberg Bonds News