02 December 2010 The Intelligent Investor

U.S.
The Economic Monitor Series. Free Edition.

INSIDE THE REPORT MARKETS AT A GLANCE

 Stock recommendations and price targets from top
brokerage firms
 Analysis and views on Fiscal plan draws flak, praise
 Economic Indicator Watch along with Graphs
 List of companies earnings which hit and miss the analysts’
expectations
 Wall Street rallied for a second day, as concerns about Europe's
sovereign debt crisis waned, giving investors the chance to add to
positions among recent winners among banks and retailers. The
DJIA was up 106.63 points, or 0.95 percent, at 11,362.41
 The benchmark 10-year note last traded down 7/32 in price. Its
price had risen as much as 6/32 at midday after falling 18/32 in
early trading. Its yield was last 2.99 percent, up from 2.97 percent
late Wednesday after touching a session low of 2.94 percent
earlier.

 Important Events Scheduled on December 03
Economic Events
 Federal Reserve Bank of Cleveland President Sandra
Pianalto speaks on "Current Economic and Monetary
Policy Issues" at Oberlin College
Corporate Events
 Big Lots will report its quarterly results.
 The dollar was down 0.5 percent against the yen at 83.76,
weighed down earlier by a rise in the latest weekly jobless claims.
 Weaker dollar encouraged buying of riskier assets such as oil and
other commodities, while upbeat U.S. economic data added
support. On the NYME, crude for January delivery settled up $1.25,
or 1.44 percent, at $88 a barrel.
 Gold turned flat after failing to break above $1,400 an ounce, as
safe-haven buying faded after European lenders offered a liquidity
safety net for vulnerable banks and as U.S. data showed signs of
an improving economy. Spot gold was up less than 0.1 percent at
$1,388.60 an ounce at 2:08 p.m. EST.

Top Stories STOCK INDICES

 Jobless claims rise INDEX LAST CHNG % CHNG

DJIA* 11362.41 106.63 0.95

 Pepsi to buy Wimm-Bill-Dann
Nasdaq* 2579.35 29.92 1.17

 Toll Bros posts profit S&P 500* 1221.53 15.46 1.28

NYSE Composite 7712.25 108.52 1.43
 IAC says CEO Diller steps down
Global Dow 2021.65 35.71 1.8
 JPMorgan accuses Lehman again * CLOSING VALUES

 Bombardier profit falls CURRENCIES

 SEC, banks talk of ending mortgage deal probe: WSJ
INDEX LAST PRIOR

 At least three to bid for AIG Taiwan unit: Sources Euro (EUR/USD) 1.3223 1.3137

U.K. Pound (GBP/USD) 1.5596 1.562

Japanese Yen (USD/JPY) 83.87 84.17

All prices are at 03:53 PM EST

FUTURES
LAST CHANGE

Crude Oil 87.96 1.21

Natural Gas 4.339 0.07

Gold, Dec. 1386.2 -2.1

Copper 397.3 2.55

Wheat 747 0

All prices are at 03:43 PM EST

The Intelligent Investor - U.S.

STOCK RECOMMENDATIONS BY BROKERAGE HOUSES

BROKERAGE/COMPANY ACTIONS RATING

JP Morgan

Rowan Cos Recommends price target of $36 Overweight

Fairchild Recommends price target of $18 Overweight

Intersil Recommends price target of $14 Neutral

Piper Jaffray

Sprint Nextel Raises price target to $4 from $3.50 Neutral

Brean Murray

Abercombie & Fitch Raises to buy from sell Buy

Incyte Corp Recommends price target of $22 Buy

Goldman Sachs

Apache Corp. Adds to americas conviction buy list —

Principal Financial Raises price target to $32 from $31 —

Barclays

CME Group Raises price target to $312 from $307 Equal-weight

ICE Raises price target to $125 from $123 Overweight

NYSE Euronext Raises price target to $31 from $30 Overweight

Stifel

Costco Wholesale Raises target price to $73 from $68 Buy

Finisar Raises price target to $27 from $25 Buy

Raymond James

Halliburton Co Raises price target to $55 from $45 —

Pioneer Natural Resources Raises price target to $107 from $90 —

Aeropostale Cuts to market perform from outperform Market perform

S&P Equity

HJ Heinz Cuts to hold from buy on valuation Hold

Wedbush

ITT Corporation Recommends price target of $58 Outperform

Nomura

Motorola Starts with reduce rating Reduce

UBS

Red Hat Raises price target to $50 from $44 Buy

Symantec Corp Raises price target to $19.50 from $18 Buy

American Capital Starts with buy rating Buy

Ares Capital Starts with buy rating Buy

Biomarin Pharmaceutical Cuts to neutral from buy Neutral

Blackrock Kelso Starts with neutral rating Neutral

Wells Fargo

Legg Mason Starts with market perform rating Market perform

Blackrock Starts with outperform rating Outperform

Credit Suisse

Kimco Realty Raises target price to $17 from $15 —

Finisar Raises target price to $30 from $25 —

Disclaimer: The views and investment tips expressed by investment experts are their own, and not that of IBTimes or its management. We advise users to check with certified experts before
taking any investment decisions.
The Intelligent Investor - U.S.

TOP STORIES

Jobless claims rise

Initial claims for state unemployment benefits increased 26,000 to a seasonally adjusted 436,000, said the Labor Department. There
was drop in the four-week moving average of new jobless claims. The four-week average of new jobless claims, considered a better
measure of underlying labor market trends, fell 5,750 to 431,000, the lowest since early August 2008. The number of people still
receiving benefits under regular state programs after an initial week of aid rose 53,000 to 4.27 million in the week ended November
20. The number of people on emergency unemployment benefits increased 142,874 to 3.94 million in the week ended November 13.

Pepsi to buy Wimm-Bill-Dann

In its biggest-ever international acquisition, PepsiCo is set to pay $3.8 billion for a 66 percent stake in Russian
juice and dairy producer, Wimm-Bill-Dann. The deal will give Wimm-Bill-Dann an enterprise value of $5.4 billion.
PepsiCo will offer to buy the remaining shares following completion of its controlling stake. Pepsi has offered the
price of $33 per American depositary receipt, which represents a 32 percent premium to the 30-day average
trading price of Wimm-Bill-Dann's U.S.-listed shares. The deal will raise PepsiCo's annual global revenues from
nutritious and functional foods to nearly $13 billion from around $10 billion.

Toll Bros posts profit

Toll Bros reported profit for its fourth quarter helped mainly by cost cuts and an income tax benefit. Earnings for the quarter stood at
of $50.5 million, or 30 cents per share, compared with a year-earlier loss of $111.4 million, or 68 cents per share. But the number of
net signed contracts fell 27 percent to 558 units. Its revenue fell 17 percent to $402.6 million, but ahead of analysts' average estimate
of $393.8 million.

IAC says CEO Diller steps down

Barry Diller is stepping down as chief executive of InterActiveCorp, the company confirmed today. IAC said it had bought out one of
its largest shareholders; John Malone's Liberty Media Corp. IAC said on Liberty had sold its entire equity stake in IAC in exchange for
$220 million in cash and the Evite and Gifts.com businesses.

JPMorgan accuses Lehman again

JPMorgan Chase hits back Lehman Brothers Holdings saying it was misled into lending more than $70 billion
to the bankrupt U.S. investment bank in the belief it would be repaid in full. JPMorgan said in court papers that it
loaned the money believing it would be paid back in full after British bank Barclays' purchase of Lehman's U.S.
brokerage business.

Bombardier profit falls

Bombardier Inc reported a 15 per cent drop in third-quarter profit. The world's No. 3 civil aircraft maker after Airbus and Boeing,
said the commercial aircraft market was still tough and resulted in huge percentage drop. For the August-October quarter, it reported
net income of $143 million, or 8 cents a share, below analysts' average expectation of 9 cents a share. Its revenue fell 13 per cent to $4
billion. The company said order backlog in aerospace fell to $16.2 billion as of October 31, from $16.7 billion on January 31. The
aerospace division received 23 net orders during the quarter.

SEC, banks talk of ending mortgage deal probe: WSJ

U.S. securities regulators are in preliminary talks with several banks to resolve probes involving sales of complex
mortgage bond deals that led to the financial crisis, the Wall Street Journal said. The investigation by the
Securities and Exchange Commission (SEC) involves mortgages and other loans known as collateralized debt
obligations, or CDOs, that were sold to different investors, citing people familiar with the matter, the paper said.

At least three to bid for AIG Taiwan unit: Sources

Taiwan's Fubon Financial, Chinatrust and the chairman of conglomerate Ruentex will bid for AIG's Taiwan unit after completing
due diligence, four sources with direct knowledge of the situation revealed to Reuters. A fourth party to the due diligence, Cathay
Financial, will make a decision on whether to bid on Friday, one of the sources said. AIG said in November it aims to sell Nan Shan for
around $2 billion within two months.
The Intelligent Investor - U.S.

ANALYSIS AND VIEWS

Fiscal plan draws flak, praise

By Joseph Picard

Sen. Judd Gregg, R-NH, stated the obvious today regarding a plan to deal with the nation's long-term fiscal well-being. He said, "There are no easy fixes here."

He may just as well have said that there are no easy ways to move forward even when you have a plan full of uneasy fixes. The National Commission on Fiscal
Responsibility and Reform today unveiled its plan for cutting the nation's $13.8 trillion budget deficit down to manageable size and immediately triggered the kind of
opposition and criticism commission co-chair Alan Simpson predicted.

Simpson, former Republican senator from Idaho, said critics from both sides of the political spectrum would "rip the plan to shreds." He said the plan would be buried
"in an unmarked grave."

"But this baby ain't going away," Simpson added at today's press briefing. When lawmakers are forced to deal with the national budget this spring, the commission's
plan "will rise from the crypt."

The commissioners themselves may have begun digging the plan's grave. Of the panel's 18 members, 14 must vote to approve the plan for it to go to Congress as a
proposal. The commissioners will vote on Friday. Three commissioners - Rep. Jan Schakowsky, D-IL, Rep. Paul Ryan, R-WI and Rep. Jeb Hensarling, R-TX -- said
today that they would vote against it. Seven commissioners - Simpson, co-chair Erskine Bowles, Sen. Gregg, Sen. Kent Conrad, D-ND, Alice Rivlin, White House budget
director in the Clinton administration, David Cote, CEO of Honeywell International and Ann Fudge, former chief executive of Young & Rubicam - have pledged to
vote for the plan. Sen. Tom Coburn, R-OK and Rep. John Spratt, D-SC said they were leaning in favor of the plan. That leaves six commissioners on the fence -- Sen.
Max Baucus, D-MT, Sen. Mike Crapo, R-ID, Sen. Dick Durbin, D-IL, Rep. Xavier Becerra, D-CA, Rep. Dave Camp, R-MI and Andrew Stern, president of the
Service Employees International Union. Bowles has already said that if the supermajority of commissioners fails to approve the plan, it will still be a valuable document
because Congress can use it to spur debate on the issue.

"The era of deficit denial is over in Washington," Bowles said.

The commissioners opposing the plan agreed with Bowles that the deficit is a problem that must be dealt with. Hensarling said the most significant result of the
commission's work was producing a plan, which lawmakers may now use to develop a better plan.

Schakowsky said the nation is "on an unsustainable fiscal course," but she could not support the plan because it did not share the burden, as professed, but leans too
heavily on the nation's more vulnerable populations.

"To reduce our deficit and debt by asking Medicare recipients to pay higher fees is not sharing the sacrifice," she said.

Hensarling and Ryan objected to the plan's call for ending tax breaks.

The plan intends to reduce the national debt by $4 trillion by 2020, by cutting discretionary spending and eliminating tax breaks. It would eliminate earmarks, cut farm
subsidies, freeze the defense budget and eliminate 200,000 federal jobs by attrition. The plan would also gradually raise the Social Security retirement age to 68 by
2050 and 70 by 2075. The plans also proposes cuts to Medicare and Medicaid.

According to the plan, over $1.4 trillion of the savings would come from discretionary spending, over $700 billion from mandatory spending, over $700 billion from tax
reforms, and over $600 billion from paying less interest on debt. Under this proposal, in 2020, the budget deficit is projected to be to just $382 billion, or 1.6 percent of
the projected 2020 GDP. By 2037, the budget would be balanced and then turned into surpluses in subsequent years.

The spending cuts would start gradually in 2012 in order to not disturb the fragile economic recovery, the commission said. Maya MacGuineas, president of the
Committee for a Responsible Federal Budget, which group backs the plan as a mature way forward in dealing with the nation's fiscal problems, said that the plan will
find supporters even if it doesn't get the 14 votes on Friday.

"I think the plan is great and it will get support ," MacGuineas said. "It does a lot on every area, which unfortunately is necessary."

AFL-CIO President Richard Trumka issued a statement denouncing the plan.

"No proposal on fiscal issues is serious that leaves the Bush tax cuts for the rich in place while raising taxes on the middle class and slashing Social Security and
Medicare," Trumka said. "All commission members should vote no on this misguided plan. All members of Congress should also oppose these job-killing policies if
they are raised in future legislation or budgets."

Trumka said the plan "reeks of hypocrisy."

"The faux deficit hawks on the commission - and Senators who claim unemployment insurance must be paid for -- have no problem clamoring for more unpaid Bush
tax cuts for millionaires," Trumka said.

Trumka said lawmakers should be focused on "the jobs deficit."

"Fifteen million people are out of work, and another eleven million have given up looking or are working part-time involuntarily," he said. "We need to invest in jobs by
rebuilding our crumbling infrastructure and green technologies and end tax breaks that send American jobs overseas."

John Irons, research and policy director for Economic Policy Institute, said "it is becoming increasingly clear that the Bowles-Simpson plan will not receive the required
14 votes to send the report to the President and Congress. The rejection of the proposal should not be seen as a failure to take deficit reduction seriously, but rather
that the policy approach adopted by the co-chairs is flawed."

Irons said the plan "fails to fully acknowledge the current economic crisis."

The plan calls for "serious belt-tightening" beginning in just 10 months, even though the nation's unemployment rate will still likely be between 9 and 10 percent, Irons
said.

"The plan includes no concrete, immediate action to create jobs or to spur economic growth in the near term," Irons said.
The Intelligent Investor - U.S.

ECONOMIC INDICATOR WATCH ON 03 DECEMBER 2010

Non-farm Payrolls (MoM)

Forecast: 140k Prior: 151k

Manufacturing Payrolls

Forecast: 5k Prior: -7k

Private Payrolls

Forecast: 153k Prior: 159k

Unemployment

Forecast: 9.6pct Prior: 9.6pct

Average Hourly Earnings

Forecast: 0.2pct Prior: 0.2pct

Average Work Week

Forecast: 34.3Hrs Prior: 34.3Hrs

The Labor Department will release its report on various payrolls for the month of November at 0830 EST. Nonfarm payrolls increased 151,000 in October, the first
increase since May, as a 159,000 jump in private employment more than offset a 8,000 drop in government payrolls. In addition, the government revised payrolls for
August and September to show 110,000 fewer jobs lost. The department will release other macro-economic data like unemployment, average hourly earnings and
average work week etc.

ISM Non-manufacturing index (MoM)

Forecast: 54.8 Prior: 54.3

ISM Non-manufacturing business activity (MoM)

Forecast: 57.2 Prior: 58.4

The Institute for Supply Management will report its data for non-manufacturing
activity in November at 1000 EST. In its last report, the Institute for Supply
Management said its index of non-manufacturing activity rose to 54.3 in October
from 53.2 in September. A reading above 50 indicates expansion in the non-
manufacturing sector, which comprises mostly service sector firms and accounts for
two-thirds of U.S. economic activity. In the same report ISM said Non-manufacturing
business activity was 58.4 in the month of October. The Data from October had
showed acceleration in manufacturing activity allaying fears of a sharp slowdown in
the sector, which has been leading the recovery. Many economists suggest although
the pick-up in services industries was not as robust as the manufacturing sector, the
combined picture certainly points to an improvement in the pace of overall
economic activity in the fourth quarter of the year.

FORE-
EST/GMT INDICATOR PERIOD UNIT PRIOR
CAST

0940/1440 ECRI Inflation Nov -- -- 97.4

1000/1500 Factory Orders Oct pct -1 2.1

Durable goods Oct-Rev pct -- -3.3

Ex-Transportation pct -- -2.7

Ex-Defense pct -- -2.1

Nondefense ex-air pct -- -4.5

1030/1530 ECRI Weekly Index weekly -- -- 126.4

The Intelligent Investor - U.S.

DAILY EARNINGS HITS & MISSES AS ON 02 DECEMBER, 2010

Company Name Qtr Curr EPS Est EPS Act Diff EPS Rev Est Rev Act Rev Diff

BOMBARDIER Q3 USD 0.09 0.08 -0.01 4525.8 4015 -510.8

CONN'S Q3 USD -0.26 -0.14 0.12 167.1 169.9 2.8

CORESITE REALTY Q3 USD -- -- -- 22.9 14.1 -8.7

DEL MONTE FOODS Q2 USD 0.35 0.41 0.07 957 940.9 -16.1
FIFTH STREET FINANCE Q4 USD 0.22 0.21 -0.01 19.6 20 0.5
GILDAN ACTIVEWEAR Q4 USD 0.46 0.48 0.02 370.1 368.9 -1.2

GILDAN ACTIVEWEAR Q4 USD 0.45 0.48 0.03 371.5 368.9 -2.6

ISLE OF CAPRIS CASINOS Q2 USD -0.07 -0.06 0.01 248.8 246.7 -2.1
KROGER CO Q3 USD 0.32 0.32 0 18529.7 18697.9 168.2
MET-PRO Q3 USD 0.12 0.1 -0.02 22.6 21.4 -1.2

MOVADO GROUP Q3 USD 0.32 0.5 0.18 128.8 123 -5.8

TOLL BROTHERS Q4 USD -0.08 0.24 0.32 393.8 402.6 8.8
TOYOTA MOTOR Q2 USD 0.67 0.73 0.06 59862.4 56038.6 -3823.8
UTI WORLDWIDE Q3 USD 0.25 0.26 0.01 1217.2 1198.4 -18.8
VIMPELCOM Q3 USD 0.39 0.39 0 2846.2 2824.4 -21.8

THE NEXT TRADING DAY

Economic Events
 Federal Reserve Bank of Cleveland President Sandra Pianalto speaks on "Current Economic and Monetary Policy Issues" at Oberlin
College - 0100 GMT

"Responding to inflationary and disinflationary pressures gets to the heart of what a central bank can and must do," Pianalto told an audience at
Case Western Reserve University.

"Ensuring price stability is our job. My belief is that by promoting price stability, the Federal Reserve is following the best course for supporting the
economic recovery," she said.

"Given the momentum toward lower inflation rates and sizable amounts of labor market slack already evident in today's pricing decisions, I expect
core inflation to remain quite subdued through 2013,"

"Although I do not expect an outright decline in the general level of prices, with demand in the economy still weak and unemployment so high,
further disinflation remains a risk to my outlook, Pianalto added. "I take this risk seriously, because in periods of significant economic slack, very low
inflation risks tipping into deflation."

Our economy is digging itself out of a deep hole and continues to perform far below its potential, Pianalto said, adding that she did not expect the
U.S. jobless rate to fall below 8 percent before 2013.

Company Events
 Big Lots will release its third quarter results. Analysts expect the company to report an EPS of 24 cents, up from 27 cents in the year ago
quarter. Net sales for the second quarter increased 5.1% to $1.14 billion from $1.09 billion last year, but missed market projections of
$1.15 billion. Comparable store sales for stores open at least two years at the beginning of the fiscal year increased 3.8% for the quarter.
Gross margin for the second quarter was up by 50 basis points due mainly to lower markdowns as a percent of sales and a favorable
merchandise mix, while operating profit rate improved by 110 basis points compared to last year.

This report is produced by

International Business Times
For questions or comments
reach us at
researchanalysis@ibtimes.com

For more information about

our products visit
www.ibtimes.com

© IBTimes 2010. All rights reserved.