UPDATE: Frozen Food Fight Helps Consumers, Threatens To Burn Producers

By Matt Andrejczak

SAN FRANCISCO (Dow Jones) -- A bruising battle for market share that has rattled frozen food aisles for months shows no sign of abating.

This is good news for cash-starved consumers eager to upgrade from Salisbury steak. But it could crimp earnings at H.J. Heinz, ConAgra Foods and Nestle S.A., top sellers of frozen entrees in the U.S., if it goes on much longer.

Heinz, best known for its ketchup, makes Smart Ones, Boston Market and TGI Friday frozen meals. ConAgra sells Healthy Choice, Marie Callender and Banquet, while market leader Nestle owns Lean Cuisine, Hot Pockets and Stouffer's.

Bill Johnson, chief executive at Heinz, said aggressive promotions will squeeze industry margins and devalue the frozen food category if they persist. So far, Heinz has resisted matching the deep discounts of competitors even though this decision has undercut sales.

While Heinz does not break out frozen food sales in its financial statements, the company is the second-largest provider of frozen prepared meals in the U.S. Smart Ones holds a 27% U.S. share, Ore-Ida, 50%, and TGI Friday's, 17%, according to data the company cites from researcher A.C. Nielsen.

"We expect to lose some share rather than chase volume to achieve an end result that could be best described as profitless prosperity," Johnson said at a recent analyst conference in Boca Raton, Fla.

UPDATE: Lessons Learned Keep Airlines Safe Despite Recent Headlines

By Christopher Hinton

NEW YORK (Dow Jones) -- After two years of a nearly flawless safety record, airlines are again under the microscope following a rash of accidents that have left 59 people dead.

But airline industry experts say the recent plane crashes in New York City, Buffalo, N.Y., London and Amsterdam aren't related, and that they're only attention grabbing now after years of improving safety standards and falling fatalities.

"It's one of those coincidental things," said Todd Curtis, an aviation expert and founder of AirSafe.com. "Clearly, because of the world we live in, when you have events like this it gets a lot of attention and the public perception of aviation safety is heightened, but the risk continues to decrease."

Indeed, the number of international accidents for this year is down sharply, with just 5 substantial accidents -- those where the aircraft's hull has been breached -- for all of January compared to 15 last year, said Martine Ohayon, a spokesperson with the International Air Transport Association, or IATA.

BOND REPORT: Treasurys Edge Up As Stocks Flounder

By Deborah Levine

Treasury prices posted slight gains Monday, erasing earlier losses, as stocks compounded their losses while investors fretted about how the government will support financial institutions.

Ten-year note yields (UST10Y) slid 1 basis point to 2.78%, after earlier reaching 2.88% earlier. A basis point is 0.01%.

Yields on 2-year notes (UST2YR), which move inversely to prices, inched down 1 basis point to 0.94%, after having briefly risen above the 1% mark for the first time since Feb. 10.

Bonds retraced losses as U.S equities surrendered early gains, indicating continued concerns about the banking sector after the government detailed plans to begin "stress tests" of financial institutions.

"There are a lot more questions than answers right now," said Mario De Rose, a fixed-income strategist at Edward Jones & Co.

Safe havens such as U.S. government debt typically draw money from investors are shying away from riskier assets, like equities.

"The market is probably going to stay in a relatively narrow range until we get more answers about the banks," De Rose said.

LATIN AMERICAN MARKETS: Cemex, U.S. Bank System Worries Pull Mexico To Four-month Low

By Carla Mozee

Mexican equities were knocked back to four-month lows Monday, with losses suffered by cement maker Cemex SAB after a ratings downgrade and pressure from Wall Street, where stocks crumbled to 12-year lows.

Mexico's IPC fell 2% to 17,956.40. It was the lowest close for the benchmark since Oct. 23, and its fifth decline in a row.

On Wall Street, investors remained on edge as the U.S. government prepared to release details this week about stress tests it plans to administer to financial institutions. The S&P 500 Index (SPX) dropped 3.5% to 743.33, and the Dow Jones Industrial Average (DJI) fell 3.4% to 7,114.78.

Among the measures, bank regulators will consider how much capital a bank has left if it were to register its losses immediately. Companies that fail tests could be forced to accept investment from or be nationalized by the government.

In Mexico City, shares of Cemex (CX) stumbled 4.9% after Fitch Ratings cut the company's credit ratings, saying the company is facing a heavy debt load while three of its key markets -- the U.S., Spain and the U.K. -- are in " unprecedented downturns." Cemex is the largest provider of ready-mix concrete and cement to the U.S.

Consumer prices show first gains in several months

Consumer prices increased in January for the first time in several months, according to new figures from the Department of Labor.

The department's latest Consumer Price Index summary found a 0.3 percent increase in the cost of consumer goods, largely due to rising energy prices. The index had actually declined for three consecutive months prior to January following two months of zero percent change.

"A bit of inflation is encouraging. It means businesses aren’t completely giving up and slashing prices. The fact that they can at least hold the line on their price cuts is a positive," Mark Zandi of Moody's Economy was quoted as saying in a New York Times report.

In the Labor Department's report, transportation costs were up 1.3 percent while energy was up 1.7 percent. Other categories such as housing and food posted much smaller changes of less than 0.5 percent.

The latest figures may help calm some lingering fears among analysts about the possibility of deflation further impacting the recession, although much of this will depend on whether the recession continues to deepen in the coming months.

UPDATE: Citi, Bank Of America Fall Further On Nationalization Concern

By Alistair Barr

SAN FRANCISCO (Dow Jones) -- Bank of America Corp. shares hit a record low and Citigroup Corp.'s stock slumped to an 18-year low Friday, as the two financial giants faced investors' concerns they may be nationalized.

Citigroup shares dropped 33% to $1.68, their lowest level since early 1991. Bank of America fell 29% to $2.81, and earlier changed hands at a lowest-ever $ 2.53, according to FactSet Research data.

A Citigroup (C) spokesman highlighted the bank's high Tier 1 capital ratio, a measure of financial strength, and said it continues to cut assets on its balance sheet, reduce expenses and streamline its businesses for future " profitable growth." He declined to comment further.

Citi isn't having conversations with the U.S. government about nationalization, Reuters reported, citing two unidentified people close to the New York-based bank. However, those people also said the U.S. Treasury has not disclosed much more to Citigroup than it has to the broader public about its plans for the banking sector.

"We see no reason to nationalize a bank that is profitable, well capitalized and actively lending," said Scott Silvestri, a spokesman at Bank of America ( BAC).

LATIN AMERICAN MARKETS: Mexico's Rate Cut Falls Short Of Expectations; Vale Shares Drop

By Carla Mozee

Investors drove Mexico's equity market and its currency down Friday after the central bank's interest-rate cut wasn't as deep as expected.

After the rate decision, data released showed the first contraction in the Mexican economy since 2003.

Mexico's IPC posted its fourth loss in a row, finishing 1.9% lower at 18, 324.23.

Shares of interest-rate sensitive banks finished mixed. Grupo Financiero Banorte slumped 1% and Banco Compartamos fell 1.6%. Grupo Financiero Inbursa reversed declines and rose 1.9%.

The Bank of Mexico on Friday lowered its benchmark interest rate by 25 basis points to 7.5%. The decision was below the market estimate for a half-percentage point cut.

"Manufacturing in Mexico is really collapsing and, for that reason, they need as much monetary help that they can get. A 25 basis-points cut was really somewhat meaningless," said Doug Smith, head of Latin American research at Standard Chartered Bank, in a telephone interview.

LATIN AMERICAN MARKETS: Chile Slashes Key Interest Rate; Regional Stocks Finish Lower

By Carla Mozee

Latin America's biggest equity markets closed lower Thursday, with losses stemming from declines in energy prices and continued uneasiness about a key element that's missing from the U.S.' plan to stabilize the financial system.

Chilean stocks fell before the central bank announced a big cut in its key interest rate, to 4.75% from 7.25%. The cut of 250 basis points was significantly larger than market consensus for a cut of 100 basis points.

Mexico's IPC gave up 0.5% to end at 19,358.25, and Argentina's Merval fell 2% to 1,078.08.

Brazil's Bovespa, the index tracking the largest equity market in the region, fell 0.8% to 40,500.79.

"Huge volatility in U.S. stock markets combined with bad mood of economic agents that continue to fear the effectiveness of economic plans and bailout to financial system contributed to another weak session at Bovespa," wrote analysts at Agora Senior late Thursday.

Draft CRA: SECP to seek viewpoints of corporate entities, stakeholders

ISLAMABAD (February 10, 2009): The Securities and Exchange Commission of Pakistan (SECP) has decided to notify the Corporate Rehabilitation Act (CRA) in the next three months, incorporating viewpoint of all private stakeholders. This was decided in a meeting of the committee, constituted by the Ministry of Finance to review and finalise the draft CRA, held under the chairmanship of acting Chairman of SECP Salman Ali Shaikh.

Application of IFRSs, IASs: ICAP not competent to issue any relaxation

KARACHI (February 10, 2009): It is not within the ambit of Institute of Chartered Accountants of Pakistan (ICAP) to issue any relaxation from application of International Financial Regulatory Standards (IFRSs) or International Accounting Standards (IASs). However, Securities and Exchange Commission of Pakistan (SECP), being regulators, are empowered to lay down specific treatments in certain special circumstances which prevail over the requirements specified in the IFRS/IAS.

UPDATE: Hasbro Net Drops 30%, Hit By Weak Holiday Sales And Dollar's Rise

By Matt Andrejczak

SAN FRANCISCO (Dow Jones) -- Hasbro Inc. reported Monday a 30% decline in quarterly net income, as the holiday sales season proved to be a disappointment and the dollar gained strength.

The world's No. 2 toy maker said it earned $93.6 million, or 62 cents a share, in the fourth quarter. In the year-earlier period, Hasbro made $133.7 million, or 84 cents a share.

Sales fell 5% to $1.23 billion from $1.3 billion. Hasbro said sales started to slow in October as weak consumer spending exacerbated. To spur demand and help toy retailers avoid excess shelf inventories, Hasbro worked with toy retailers to mark down toys priced above $200 and slower-moving items, such as toys tied to movies Indiana Jones and the Hulk.

Excluding the impact of the rising dollar against other global currencies, Hasbro said sales would have risen 1%. Sales of Nerf, Star Wars, Playskool, Littlest Pet Shop and Easy Bake were among the strongest in the fourth quarter.

On Wall Street after the report, Hasbro shares rose 6% to $25.01 in early trading.

Chief Executive Brian Goldner said in a conference call the toy maker's business will improve after March, when it begins to ship toys for movies Transformers 2 and Wolverine and further expands its digital-gaming partnership with Electronic Arts.

"As the year progresses, we would expect to see more momentum around our major movie initiatives and as we roll out our many new brand initiatives this fall" Goldner said.

Last week, toy rival Mattel rattled investors with news that its profit fell 46% on weaker sales.

UPDATE: Amazon Debuts Kindle 2 But Sticks To Same Price

By Jeffry Bartash

NEW YORK (Dow Jones) - Amazon.com on Monday unveiled a slimmer, lighter version of the Kindle, its electronic book reader, with a host of new features but the same price point as the original device.

At a press conference in New York, Amazon Chief Executive Jeff Bezos demonstrated the new device, which will be available for shipping on Feb. 24. Dubbed the Kindle 2, the device is thinner than the popular 3G iPhone and can hold more than 1,500 books. The company also said it has extended the battery life of the product by 25% from the original version.

The new device comes barely a year after Amazon launched the original Kindle, which has been sold out for much of that time. The company has never disclosed specific sales figures for the device, though analysts guess that as many as 500,000 units of the device have been bought.

"We've been selling ebooks for years, and guess what? It didn't work, until fourteen months ago," Bezos said at the event.

The Kindle, originally launched in December 2007, is the first reading device that allows customers to buy and download books without a connection to a computer. The goal of the nation's largest Internet retailer is to use the Kindle to remake the book market for the digital age.

The new version of the device is just 0.36 inches thick and weighs just over 10 ounces. The device offers 2GB of memory capacity that Amazon says will hold more than 1,500 books compared with just 200 books for the original version.

The extended battery life will allow Kindle 2 users to read for 4-5 days on a single charge if the device's wireless service is turned on.

BOND REPORT: Ten-year Treasury Yields Above 3% Before Auctions

By Deborah Levine

Treasurys fell Monday, pushing yields to their highest in more than two months, before the government floods the market with its biggest quarterly refunding package on record.

Ten-year note yields rose 2 basis points, or 0.02%, to 3.01%. It earlier reached 3.05%, the first time above 3% since November.

Two-year note yields increased 2 basis points to 1.01%, the first time above 1% since early December.

Shorter-term securities fared better, with yields a little lower in early trading, amid disappointment in further delays from Washington in the details of a plan to support banks and continuing debate in Congress over the stimulus package.

"This week is all about the challenge of massive supply," said strategists at RBS Greenwich Capital. "The economic environment remains very bond friendly but issuance is problematic."

The Treasury Department sold $31 billion in three-month bills at a rate of 0.345%.

It also sold $30 billion in six-month bills at a rate of 0.488%.

The government's quarterly sales of three- and 10-year bonds and 30-year bonds are the main focus of the market.

On Tuesday, $23 billion in one-year notes and a record $32 billion in three- year notes will be on sale. Wednesday will bring $21 billion in 10-year notes, followed by $14 billion in long bonds the following day. Both long-term debt sales are for the most ever.

Sri Lanka Government: Thousands Of Civilians Pouring Out Of War Zone

COLOMBO (AFP)--At least 10,000 civilians have escaped Sri Lanka's war zone in the last four days, the government said Sunday, as the president warned Tamil Tiger rebels to surrender unconditionally or be killed.

The Tigers are fighting for survival after being driven back into a small patch of jungle by a military offensive that threatens to end their 30-year armed campaign for an independent ethnic Tamil homeland.

"Over 10,000 civilians have come to Kilinochchi while 139 others have come to Jaffna since the Independence Day [Wednesday]," the ministry said. "Among the rescued civilians are over 2,800 children and about 3,000 women."

The ministry added that medical care, food and water were being provided at the frontlines for the fleeing civilians, who it says were among those held by the Tigers as "human shields."

Government reports of the civilians' movement and recent army advances cannot be verified as journalists, aid groups and international observers are not allowed into the conflict zone.

Towns Wiped Out In Australian Fires

SYDNEY (AFP)--Australia's rampaging wildfires have wiped out a pretty resort village and could have largely destroyed another town, authorities said Sunday.

At least 65 people have died in the fires in southeastern Victoria state, with the village of Marysville and the town of Kinglake among the hardest hit.

"Marysville, which was one the loveliest townships in Victoria, if not Australia, has just about been wiped out," said Pastor Ivor Jones, whose own home in the town was razed.

Victoria state's Country Fire Authority said only one building was left standing in the popular tourist hamlet, although there were no fatalities among the residents.

Deputy Prime Minister Julia Gillard said whole towns would need to be rebuilt and the federal government was preparing a massive disaster relief effort.

Shocked survivors in Marysville told the Australian Broadcasting Corp. how the flames devoured houses one by one, with exploding gas canisters being hurled through walls.

Aerial pictures taken by the broadcaster show a town flattened, with neatly laid-out streets surrounded by rubble and blackened trees.

The village, northeast of the Victoria state capital Melbourne, had just 1,000 permanent residents, but its beauty and proximity to winter skiing had attracted city dwellers who built holiday and retirement homes there.

Egypt Hopes For Gaza Truce Accord In Next Few Days-Spokesman

CAIRO (AFP)--Egypt is hopeful that a Gaza truce accord between Israel and the Palestinian Islamist movement Hamas can be reached in the next few days, foreign ministry spokesman Hossam Zaki told AFP on Sunday.

"There are positive signs that in the next few days we will reach an understanding on a truce and and a partial reopening of crossing points [into Gaza]," Zaki said.

Egypt has been mediating indirect talks for a lasting truce since the end of the 22-day Gaza war, which killed at least 1,330 Palestinians and 13 Israelis.

The fighting ended when both Israel and the Gaza Strip's Islamist rulers called separate ceasefires on Jan. 18.

However, the fragile calm has been tested by Palestinian rocket attacks on Israel and retaliatory air strikes.

On Saturday, a spokesman for Hamas said it expected an agreement with Israel on the the reopening of border crossings into the Gaza Strip "within the next few days."

MARKET SNAPSHOT: Government Moves May Boost Stocks, But Not Necessarily Dividends

By Kate Gibson

Friday's stock advance had investors banking on more fiscal stimulus from the government, but other possible congressional action had Standard & Poor's Index Services cutting its projected dividend rate on the S&P 500.

"Due to recent events, including potential congressional action that might limit dividend payments, we are reducing the indicated dividend rate on the S&P 500," said Howard Silverblatt, senior index analyst at Standard & Poor's.

However, hopes for quick congressional passage on an economic-stimulus plan helped propel equities higher Friday, with an ugly January unemployment report proving less dire than many feared.

The Dow Jones Industrial Average (DJI) gained 217.52 points, or 2.7%, to 8, 280.59, up 3.5% for the week. The S&P 500 (SPX) rose 22.75 points, or 2.7%, to 868.60, a weekly rise of 5.2%, while the Nasdaq Composite (RIXF) added 45.47 points, or 2.9%, to 1,591.71, up 7.8% from last Friday's close. .

Standard & Poor's Index Services said Friday that it expects S&P 500 dividends to decline 13.3% in 2009, the worst yearly drop since 1942, when dividends fell 16.9%.

Standard & Poor's now expects $214.66 billion in dividend payments for S&P 500 companies in 2009, compared to $247.9 billion last year.

LATIN AMERICAN MARKETS: Bovespa Paces Gains As Investors Eye Rate Cuts, U.S. Stimulus

By Carla Mozee

Latin American equities surged Friday and finished the week with gains as investors hoped for the U.S. Senate to pass President Barack Obama's economic stimulus package.

In Brazil, a higher-than-expected reading on monthly consumer prices bolstered market sentiment that an interest-rate cut is on its way. The benchmark Bovespa index rose 4% to 42,755.50, its best closing since Oct. 3.

Stocks also were higher in Mexico, Chile and Argentina.

All sectors traded in the black, with market heavyweight Petrobras (PBR) holding onto a 4.2% gain even as oil prices retreated. Crude for March delivery fell 2.4% to $40.17 a barrel on the New York Mercantile Exchange.

Shares of steel producers leaped, with prices for metals up. Companhia Vale do Rio Doce (RIO) climbed 3.6%, Gerdau (GGB) rose 4.2% and Usiminas tacked on 3.6%.

The market's view that the country's central bank will continue to cut rates when it meets in March strengthened Friday after the census bureau said January's IPCA consumer price index rose 0.48% due to seasonal factors and increases in food prices. The index rose 0.28% in December, vs. an expected increase of 0.41%.

MARKET SNAPSHOT: Stocks Pin More Hopes On Stimulus, Rescue Plan

By Nick Godt

Investors are poised to start next week eager for plans from the government to boost the economy and rescue the financial system, which could help bulls cement a nascent February rally in stocks.

Hopes that the market has already priced in much of a dismal outlook for the economy this year were also evident Friday, as stocks rallied past news that January saw the biggest loss of jobs since 1974.

"The market is possibly looking at what we see today and thinking that we can't get much worse than that," said Paul Nolte, director of investments at Hinsdale's Associates. "It's not yet expecting that things will get better, but at least not much worse."

On Friday, the Dow Jones Industrial Average (DJI) jumped 217 points, or 2.7%, to end at 8,280. The S&P 500 index (SPX) gained 22 points, or 2.7%, to 868, while the Nasdaq Composite (RIXF) rallied 45 points, or 2.9%, to 1,591.

Chinese Yuan Advances Against US Dollar And Euro

(RTTNews) - In early deals on Thursday, the Chinese yuan advanced to a 3-day high against its European counterpart. The yuan climbed against the US dollar too.

The Chinese yuan ticked up against its US counterpart during Thursday's early Asian trading. At about 11:05 pm ET, the yuan rose to 6.8286 against the US currency, compared to Wednesday's closing value of 6.8350.

People's Bank of China today set the central parity rate for dollar-yuan pair at 6.8360.

From US, the Labor Department is due to release its customary weekly jobless claims report for the week ended January 31st at 8:30 am ET. At 10 am ET, the Commerce Department is due to release its report on factory goods orders for December. Orders for manufactured goods are likely to have decreased 3% in the month.

The Chinese yuan advanced to a 3-day high of 8.7519 against its European counterpart during Thursday's early Asian trading. This may be compared to Wednesday's closing value of 8.7803. The Yuan may likely target the 8.829 level against the European currency, if it rises further.

People's Bank of China today set the central parity rate for euro-yuan pair at 8.7593.

The Italian CPI and German Factory orders are the major economic releases scheduled for the upcoming session from the euro-area.

Japanese Protest As US Warship Docks In Nagasaki

TOKYO (AFP)--A U.S. warship docked Thursday in Nagasaki to the protests of residents and a boycott by local leaders who said the visit was in poor taste in a city obliterated by a U.S. atomic bomb.

The USS Blue Ridge, which is stationed in Yokosuka near Tokyo, sailed to Nagasaki with a stated goal of promoting friendship between Japan and the U.S.

Hundreds of residents including atomic bomb survivors chanted, "We are opposed to the port call!" as the 19,600-ton vessel arrived in the southwestern city.

"We don't want to see the U.S. flag flying at this port and this feeling will not change until the United States takes a policy towards the elimination of nuclear weapons," Osamu Yoshitomi, an official at Nagasaki city, said.

Nagasaki's mayor and regional governor both refused to take part in the welcome ceremony after unsuccessfully asking Japanese and U.S. authorities to cancel the visit.

The U.S. stations more than 40,000 troops in Japan under a post-World War II alliance. Under a 1960 agreement, local authorities don't have the right to refuse U.S. warships' port calls.

India Seeks Access To Terror Suspect In Spain

(RTTNews) - New Delhi has sought consular access to one of its national, the sole Indian picked up by the Spanish police in a terror sweep Tuesday, media reports said.

Indian officials will question Jangeet Singh who was arrested from Valencia and then decide whether to seek his extradition. The government is talking to Spanish police on the case.

In an operation, codenamed Operation Fish, Spanish police in coordination with its counterparts from other European countries arrested 11 Pakistanis from Barcelona and the Indian, suspecting this organised crime group of forging passports and other travel documents for terror organisations, including al-Qaida. The 12 men were brought to Madrid and produced in court Wednesday.

According to Spanish police, the network that they claim to have busted is involved in counterfeit documents, human trafficking and drug smuggling, and linked with document forgery and connected to other groups in France, Belgium, Switzerland, U.K., Germany and Thailand.

The group is alleged to have stolen passports and forwarded them to Thailand where they were altered and sent back to criminal gangs in Europe. Reports said the police recovered a lot of material relating to passport forgery including blank passports, mobile phones, photographs of some whose passports were being faked etc.

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New Singapore Detention Facility Within Five Years - Minister

SINGAPORE (AFP)--A new Singapore detention center should be ready in five years to replace the one from which an alleged Islamic militant made an embarrassing escape, home affairs minister Wong Kan Seng says.

Mas Selamat bin Kastari, the alleged Singapore leader of the Jemaah Islamiyah, or JI, militant group, escaped in February last year from the Whitley Road Detention Center, which holds people held by the Internal Security Department.

Kastari's escape badly dented Singapore's reputation for tight security.

A committee of inquiry found that Kastari, who walks with a limp, escaped through a bathroom window.

The committee made 10 recommendations to fix weaknesses at the detention center and all have been implemented, Wong said in a written reply to a member of parliament. The government released a copy of Wong's answer late Tuesday.

Among its recommendations, the committee urged the building of a new detention facility.

"This recommendation is in progress," Wong said.

The prison service and the Internal Security Department, which handles terrorism and other security threats, began last July to study the building of a new detention center in Changi Prison, the minister said.

MARKET SNAPSHOT: After Dismal Start To 2009, February Could Hold More Of Same

By Kate Gibson

After the worst January on record, the new month is off to an uncertain start with investors braced for more disappointing earnings results, layoffs and dismal economic data.

"There was a lot going on last week, earnings, company projections layoff announcements, housing numbers, economic numbers, and bailout announcements, and not a glimmer of hope among them. This week, we anticipate more of the same," said Marc Pado, U.S. market strategist at Cantor Fitzgerald.

"With 40% of the S&P reported, and earnings looking down 35% versus the fourth quarter last year, expectations are low," said Pado.

On Monday, equities closed mostly lower, with energy, industrials and materials down the most and technology shares helping the market pare losses.

The Dow Jones Industrial Average (DJI) finished down 64.11 points, or 0.8%, to 7,936.75. The S&P 500 (SPX) gained half of a point to stand at 825.43, and the Nasdaq Composite (RIXF) added 18.01 points, or 1.2%, to 1,494.43.

Commission proposed to investigate financial meltdown

Members of Congress are taking steps to create a commission that will investigate the near-meltdown of the nation's financial markets.

Senate Budget Committee chairman Kent Conrad and Republican congressman Johnny Isakson recently announced their legislation, which would create a seven-member panel modeled on the 9-11 Commission.

"We need to take a long hard look at how our financial system spiraled downward so far so fast. And if there was any criminal wrongdoing, people need to be held accountable," said Conrad in a statement, going on to say that the commission's final report will be used to create new rules to prevent similar financial situations in the future.

MARKET SNAPSHOT: As Goes January, So Goes The Year?

By Nick Godt

The market posted an 8.6% drop for the month, marking its worst performance on record for the month of January, and a pretty bad omen for the rest of the year, if one believes the old adage.

According to the Stock Traders Almanac's January Barometer, the month of January tends to predict the direction of the market with a 91.4% accuracy ratio, with only five major errors recorded since 1950.

The barometer, created in 1972, is based on the performance of the broad S&P 500 index.

Based on broader research from Quantitative Analysis Service, the month of January works accurately at predicting market direction 65% to 75% of the time.

"That's not an impeccable record," said Ken Tower, market strategist and senior vice president at the firm. "But, along with April, it definitely has a better track record at predicting the year than any other month in the year."

The S&P 500 index (SPX), used by most investing professionals as a gauge of the broader market, fell 8.6% for January.

This marked the worst January performance on record for the S&P, topping a 7.6% drop in January of 1970.

LATIN AMERICAN MARKETS: Brazil Finishes Lower; Mexico Edges Up But Loses For The Month

By Carla Mozee

LOS ANGELES (MarketWatch) --Brazilian shares slipped Friday, with pressure on mining giant Companhia Vale do Rio Doce following its plans for a $1.6 billion assets purchase, while Mexican shares broke through losses that followed a report that U.S. economic activity shrank to its lowest levels since the 1980's.

Brazil's Bovespa index fell 0.9% to 39,300.79.

In Sao Paulo, shares of market heavyweight Vale (RIO) fell 1.7% after Rio Tinto (RTP) said late Thursday it would sell to Vale the assets of two potash projects for $850 million and an iron ore mine in Brazil for $750 million in an all-cash deal.

Vale is the world's largest producer of iron ore, a key component for the production of steel.

The company "has appeared to pay a healthy premium, despite Rio Tinto's pressure to de-lever, and we note Vale's debt will continue to rise given aggressive dividends, capex and (now) acquisitions planned for 2009," wrote metals and mining analysts at Deutsche Bank in a note Friday.

The broker maintained its hold rating on Vale and its price target of $12 for the miner's U.S.-listed shares. Vale's New York Stock Exchange-listed shares closed down 2.2% at $14.11.

Moving the Market

[BRIEFING.COM] Sellers claimed control of the stock market for the second straight session, pushing the S&P 500 2.3% lower Friday. That left stocks down 0.7% for the week.

Stocks actually began the session with a gain after investors reacted positively to a better-than-feared GDP report. However, a closer look at the data revealed conditions are hardly sound. According to the latest data, the U.S. economy contracted at an annualized rate of 3.8% during the fourth quarter, marking the steepest drop in economic activity since 1982. The decline was less severe than the 5.5% drop that was expected, but that was largely due to an unexpected increase in inventories. Consumer spending, which accounts for roughly 70% of economic activity, remains weak as consumption expenditures dropped at a 3.5% annual rate.