More than 2 decades after exiting the television manufacturing business, General Electric Company is entering a joint partnership with Tatung Co. of Taiwan that will make GE-branded flat panel TVs that connect to the Internet. GE was also downgraded to neutral from buy and its price target cut to $28 from $37.50 by Merrill, cutting its earnings estimate for GE Capital.

Fitch Ratings downgraded the automaker General Motors Corporation’s credit rating deeper into junk status Monday, saying the automaker faces headwinds in almost every direction and its liquidity could drop to "minimum required levels" within the next year.

Japan's biggest broker by market cap Nomura Hldgs Inc is close to acquiring the European operations of bankrupt Lehman Brothers a day after buying the firm's Asian business for $225M The Wall Street Journal reported.

The stock market extends its losses, now down more than 1%. The energy sector (-2.5%) is falling in conjunction with a tumble in crude oil prices.

The dollar rose against the euro for the first time in five days on bets the greenback's biggest decline since January 2001 yesterday was too big to sustain.
Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in Senate testimony today that failure to pass the U.S. financial bailout would threaten the economy. The dollar fell yesterday on speculation the $700 billion rescue will inflate the budget deficit.
``The market is waiting for direction regarding the details of the rescue package,'' said Matthew Strauss, senior currency strategist at RBC Capital Markets Inc. in Toronto, a unit of Canada's biggest bank by assets. ``We are in a consolidation phase. The market is holding its breath.''
The euro fell earlier against the dollar as a report showed Europe's manufacturing and service industries contracted at the fastest pace in almost seven years this month.
``Economic data in Europe remind people there's more weakness coming,'' said Brian Kim, a currency strategist at UBS AG in Stamford, Connecticut. ``It's going to provide longer-term support for the dollar, but right now all focus is on the bailout plan.''
Short-term pressure on the dollar will subside as the government's efforts to prevent a prolonged recession support the currency, wrote Morgan Stanley currency strategist Stephen Jen in a note.
While U.S. interest rates may rise as the Treasury sells debt to fund its purchase of soured mortgages and other tainted loans on bank balance sheets, much of that may be recouped, mitigating the risk to the currency, Jen wrote yesterday.
``The idea that the dollar is going to be debased by this is amusing,'' said Jim O'Neill, head of global economic research at Goldman Sachs Group Inc., in an interview on Bloomberg Television. ``If this plan gets through, once more sober heads start to think about it, for the people that claim they wanted to buy the dollar around three weeks ago when it was going crazy, you're getting another chance here.''

The S&P 500 falls to the unchanged mark.
The majority of questions from the Senate Banking Committee are being directed to Fed Chairman Bernanke and Treasury Secretary Paulson.
Paulson was asked if he could do his plan with less than $700 billion, such as $150 billion, and then Congress would then reevaluate. Paulson said this would be a grave mistake, as the plan needs to have the confidence and tools to do the jobs, even though the Treasury does plan on spreading the purchases out over time.
Fed funds futures are indicating a higher chance of an October rate cut since the testimony started. Fed funds futures current suggest a 62% chance of a 25 basis point cut, compared to a 34% chance yesterday.

- Global coordination among banks, governments funtions well
- Remain concerned about inflation in EMU

- Global coordination among banks, governments funtions well
- Remain concerned about inflation in EMU

"All broad indicators of mfg activity-shipments, new orders and employment-remained in negative territory and declined from their readings in the previous month. Other indicators suggested additional softness. District contacts reported that readings on orders backlogs edged slightly lower, but noted more moderate weakness in capacity utilization. Moreover, vendor delivery times flattened, while inventories grew at a slightly slower pace." Retail rev -30 vs -24, and Services rev -15 vs -6.

Stocks get off to a modestly higher start start as key financial officials prepare to give their testimony before the Senate Banking Committee. Fed Chairman Bernanke, Treasury Secretary Paulson and SEC Chairman Cox are scheduled to appear.
The current financial market turmoil will be addressed, including the proposed $700 billion plan to have the the Treasury buy illiquid assets from financial institutions, and the government takeover of Fannie Mae (FNM 0.98, +0.19) and Freddie Mac (FRE 1.00, +0.15).

Dominique Strauss-Kahn, IMF managing director designate - "I welcome the bold steps being taken in the US and look forward to their effective implementation."

Kasper Kirkegaard, currency strategist at Danske Bank "While this bailout package does remove some of the systemic risk from the U.S. financial system, its also clear that with the potential rise in U.S. debt ratios and the effect on their fiscal balance will hurt the dollar in the medium term."

Stocks were poised for a lackluster open Tuesday, a day afer a dismal session and an oil price spike, and as a Senate panel prepared to debate the government's proposed $700 billion bailout.
Stock futures were down about one hour ahead of the open. On Monday, all three major indexes slumped with the Dow industrials sinking 373 points on worries about what details may emerge from the government's plan to restore financial stability.
In testimony prepared for a Senate Banking Committee hearing, both Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke said that immediate action is needed to save the economy.

Euro eases to $1.4730, as rate extends its corrective pullback from recovery highs of $1.4795/00. Bids had been reported in place around $1.4725, the level corresponding to a 61.8% retrace of the move up from $1.4680 to $1.4800. Further demand noted back in place between $1.4710/00. Further bids $1.4680. Offers remain toward $1.4800, more around $1.4825.

JPM says prior to MBS purchase plan they had looked for a $650b budget deficit for FY09; with the $700b MBS buy, raise that figure to $1.35 trillion. "The risk of a more aggressive Treasury GSE MBS purchase schedule, or general downside risks to the economic outlook, could easily take that figure to $1.5 trillion, or about 10% of GDP, a deficit figure not seen since WWII."

The dollar traded near a one-month low against the euro before Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke give testimony to the Senate on a government plan to rescue the banking system.
The U.S. currency also declined versus the Japanese yen and the British pound. Paulson and Bernanke will provide more details today on the proposal to buy $700 billion of troubled assets from banks to shore up the financial system. The euro was dropped against the yen after Europe's manufacturing and service industries contracted for a fourth month in September.
Paulson and Bernanke will start giving testimony to the Senate Banking Committee at 9:30 a.m. in Washington. The plan proposes buying devalued securities from financial institutions that economists estimate would drive U.S. government debt above 70 percent of gross domestic product and the annual budget gap to an all-time high, possibly exceeding $1 trillion next year.
Foreign-exchange movements may be exaggerated because trading volumes are lower than normal due to a Japanese public holiday, according to Tony Morriss, a senior currency strategist in Sydney at Australia & New Zealand Banking Group, Australia's fourth-biggest lender.
The U.S. currency lost more than 5 percent versus the euro since touching a one-year high of $1.3882 on Sept. 11. The U.S. Dollar Index traded on ICE futures in New York, which tracks the greenback against the currencies of six major trading partners, slumped almost 2 percent yesterday, the biggest drop in a decade, to 76.151. It was little changed at 76.216 today.

EUR/USD ultimately sliding to session lows under $1.4700, hitting $1.4681 before a quick bounce. Offers $1.4795/05, stops above, expiry $1.4800, bids $1.4680/70.

Offers confirmed in place at $1.4825 ($1.4823 76.4% $1.4867/1.4680, Asia high $1.4826), though rate has struggled ahead of $1.4800 in recent trade. Bids $1.4765/55.

Resistance 3: Y108.00
Resistance 2: Y107.20
Resistance 1: Y105.60
Current price: Y105.30
Support 1: Y105.10
Support 2: Y104.00
Support 3: Y103.40
Comments: The yen has updated a session high but a tech hasn't changed. The dollar fell for a second day against the yen on concern a U.S. proposal to buy $700 billion of troubled assets will erode investor confidence in the nation's finances. Resistance is around session high on Y105.60, then – at yesterday’s high on Y107.20. Stronger level remains at Friday’s high on Y108.00. Support is around session low on Y105.00/10 (also last Thursday’s low) and then – to stronger support at Y103.40 (trend line from Mar 17).

Resistance 3: Chf1.1280
Resistance 2: Chf1.0980
Resistance 1: Chf1.0820
Current price: Chf1.0775
Support 1: Chf1.0680
Support 2: Chf1.0610
Support 3: Chf1.0240
Comments: Support is around yesterday’s low on Chf1.0680. Break under will lead the dollar to May high on Chf1.0600/10. Key support is around Chf1.0240 (trend line from Mar 17. Resistance comes at 23.6% of the decline from Friday’s high on Chf1.1280 – at Chf1.0820/30. Neat band of resistance comes at 50% Fibo on Chf1.0980.

Resistance 3: $1.8940
Resistance 2: $1.8800
Resistance 1: $1.8620
Current price: $1.8570
Support 1: $1.8460
Support 2: $1.8360
Support 3: $1.8280
Comments: Tech on pound hasn't changed. Nearest resistance is 12-days channel line between $1.8620/40. Break above will open the way to Aug 21 high on $1.8800 and then – to $1.9040 (Aug 13 high). Support comes near 23.6% Fibo of the rise from $1.7920 to yesterday’s high on $1.8640 – on $1.8460. Below losses may widen to $1.8360 and key level - $1.8280 (50%).

Resistance 3:$1.5080
Resistance 2: $1.4950
Resistance 1: $1.4860
Current price: $1.4728
Support 1: $1.4700
Support 2: $1.4580
Support 3: $1.4500
Comments: The rate has tested nearest support in area of 23,6 % FIBO of growth from $1.4150 up to $1.4860. Also this level is area of 38,2 % FIBO of decrease $1.6030-$ 1.3870. Break under will accelerate the retreat to 38.2% on $1.4580/90 and then to key support on $1.4500/05 (50% of the $1.4150 - $1.4860 move). Above $1.4840/60 there is a chance to recover up to $1.4950 (50% of the $1.6030 - $1.3870 decline) with further resistance is near $1.5080 (Aug 11 high).

EUR/USD $1.4800, $1.4450/60
USD/JPY Y106.00, Y105.75, Y106.50, Y106.60/70, Y105.00
AUD/USD $0.8500
USD/CAD C$1.0500

The dollar snapped four days of declines versus the euro before Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke give testimony to the Senate on a government plan to rescue the banking system.
Foreign-exchange movements may be exaggerated because trading volumes are lower than normal due to a Japanese public holiday, according to Tony Morriss, a senior currency strategist in Sydney at Australia & New Zealand Banking Group, Australia's fourth-biggest lender.
The U.S. currency lost more than 6 percent versus the euro since touching a one-year high of $1.3882 on Sept. 11. The U.S. Dollar Index traded on ICE futures in New York, which tracks the greenback against the currencies of six major trading partners, slumped almost 2 percent yesterday, the biggest drop in a decade, to 76.151. It rose 0.5 percent to 76.505 today.
Short-term pressure on the U.S. dollar will subside as the government's efforts to prevent a prolonged recession support the currency amid a slowing global economy, wrote Morgan Stanley currency strategist Stephen Jen.
he pound was little changed against the dollar before an industry report that will show whether U.K. mortgage approvals picked up in August from close to the lowest level in at least 11 years.
House prices slid a fourth month in September, Rightmove Plc, Britain's most-used property Web site, said yesterday. The average asking price for a home fell 1 percent from August. Banks granted 22,448 loans for house purchase in July, down 65 percent from a year earlier, the British Bankers' Association said Aug. 26.

EUR/USD traded at the Asian session near to the levels reached last night in the narrow horizontal channel between $1.4825 and $1.4760 then has established a session low on $1.4710.
GBP/USD the most part of session traded in a range $1.8595 - $1.8525 then has established a low on $1.8500.
USD/JPY has made recoil up to Y105.15 in area of a yesterday's low then has established a session low on Y105.80.

Eurozone data at 0900GMT is expected to see industrial new orders come in at -0.3% m/m, -7.4% y/y in July.
UK data at 0830GMT sees August BBA mortgage data.
US data at 1400GMT sees the Richmond Fed manufacturing index for September, BLS Mass Layoffs for August and the OFHEO Home Price Index for July.

Purchasing Manager Index Services (Sep)48.2

The dollar dropped more than 2 cents to a three-week low against the euro and fell versus the yen on concern a U.S. proposal to buy $700 billion of troubled assets from financial firms will deepen the budget deficit.
The U.S. currency weakened for a fourth day against the euro in its longest stretch of decline since June before reports this week forecast to show decreases in home sales and durable goods orders in August.
The dollar dropped 1.1 percent to 106.25 yen, from 107.45. The euro increased 0.4 percent to 156.12 yen, from 155.46.
``Even with a plan, the likelihood there will be a very severe slowdown in the U.S. and elsewhere has increased,'' said Simon Derrick, chief currency strategist in London at Bank of New York Mellon Corp. ``I don't think people will return to the same old risk-taking world.''
Treasury Secretary Henry Paulson's bailout plan, sent to Congress Sept. 20, would mark unprecedented government participation in markets and increase the nation's debt ceiling by 6.6 percent to $11.315 trillion. Officials may also provide $400 billion of guarantees for money-market funds.
The dollar will get ``crushed,'' as the extra spending reduces the allure of U.S. assets to foreign investors, said John Taylor, chairman of New York-based International Foreign Exchange Concepts Inc., the world's biggest currency hedge-fund firm, which manages about $15 billion.
The chance of the Fed cutting its benchmark 2 percent rate by a quarter-percentage point at an Oct. 29 policy meeting was 38 percent, compared with zero a month ago, futures contracts on the Chicago Board of Trade showed. The European Central Bank's main refinancing rate is 4.25 percent.

EUR/USD having opened in area $1,4490 the pair has established a session high on $1,4866. Later the rate has slightly receded in area $1,4770.
GBP/USD has decreased initially to a low on $1.8260. However later the rate has become stronger to $1.8636.
USD/JPY has decreased from area Y106.80 to a low on Y105.11, having restored later to Y105.55.

It is also the morning for the European flash PMI releases for September, with the Eurozone numbers at 0800GMT expected to see manufacturing at 47.6 and services at 48.5, both slight increases from the already depressed levels of August. Further Eurozone data at 0900GMT is expected to see industrial new orders come in at -0.3% m/m, -7.4% y/y in July.
UK data at 0830GMT sees August BBA mortgage data.
US data at 1400GMT sees the Richmond Fed manufacturing index for September, BLS Mass Layoffs for August and the OFHEO Home Price Index for July.

Japan stocks jumped, sending the Topix index to its biggest two-day gain since January, after the U.S. broadened the scope of a $700 billion rescue plan to buy bad debts, and surging oil prices boosted resource stocks.
Resona Holdings Inc., Japan's fourth-largest listed bank, surged 10 percent on the U.S. Treasury's plan to purchase a variety of securities to relieve frozen credit markets. Honda Motor Co., the nation's No. 2 automaker, jumped 5.1 percent. Mitsubishi Corp. led gains by trading houses and resource producers as crude oil traded near a two-week high.
The Nikkei 225 Stock Average gained 169.73, or 1.4 percent, to 12,090.59 at the close of trading in Tokyo. The broader Topix index climbed 19.57, or 1.7 percent, to 1,168.69. The benchmark has advanced 6.5 percent in the past two sessions, the biggest back-to-back rally since Jan. 25.
Resona surged 10 percent to 147,900 yen, completing its steepest two-day climb since May 2003 with a 29 percent rise. Mizuho Financial Group Inc., which has posted $6 billion of losses on mortgage assets, advanced 2.9 percent to 460,000 yen. Nomura Holdings Inc., Japan's largest brokerage, jumped 9.6 percent to 1,430 yen after Dow Jones said it won a bid for the Asian assets of the bankrupt Lehman Brothers Holdings Inc.
Honda rose 5.1 percent to 3,500 yen. NGK Insulators Ltd., which makes filters for diesel engines, soared 13 percent to 1,326 yen, the most since July 2007, after lifting its profit forecast. Nissan Motor Co. climbed 6.4 percent to 803 yen.
Mitsubishi, Japan's largest trading company, and which gets more than half of its profit from commodities, soared 6.6 percent to 2,840 yen. Inpex Holdings Inc., the nation's biggest oil explorer, gained 9.7 percent to 1.037 million yen, the sharpest advance since May 7.
Crude for October delivery surged 6.8 percent on Sept. 19 to $104.55 a barrel in New York, capping a 15 percent rally over three days. The contract was at $105 today. Metals including lead and copper gained more than 3 percent.
GS Yuasa Corp. shares fell by a record 19 percent, the daily limit, to 427 yen, after the Japanese battery and lighting equipment maker said a unit had improperly booked sales.



European stocks fell, erasing more than a quarter of the Dow Jones Stoxx 600 Index's biggest one- day advance on record, as higher oil prices weighed on retailers and travel companies and overshadowed plans by the U.S. government to buy $700 billion of bank assets.
Carrefour SA, the world's second-largest retailer, slid 5.6 percent and Ryanair Holdings Plc dropped 6.3 percent as crude headed for its steepest four-day gain since October 2000. Compass Group Plc retreated 4.8 percent after Credit Suisse Group AG downgraded the shares. Holcim Ltd., the second-biggest cement maker, slumped 18 percent as takeover speculation faded.
Europe's Dow Jones Stoxx 600 Index lost 2.1 percent to 272.35, following an 8.3 percent rally on Sept. 19 when the U.S. government announced plans to halt the credit-market seizure.
Crude for October delivery rallied as much as $4.45, or 4.3 percent, to $109 a barrel on the New York Mercantile Exchange. Futures have climbed 20 percent in the past four days.

The major indices were pummeled on Monday due to uncertainty over the details regarding the U.S. government’s $700 billion plan to fix the financial market turmoil and news that the two remaining major Wall Street investment banks converted to a traditional banking structure.
The S&P 500 fell 3.8%, settling at session lows, with all ten of the economic sectors posting a loss. Financials fell 8.5%, and consumer discretionary stocks declined 5.0%. The dollar fell sharply, and commodities rallied.
Sunday night, the Federal Reserve agreed to convert Goldman Sachs (GS 120.59, -9.21) and Morgan Stanley (MS 27.26, +0.05) into bank holding companies. The move will allow Goldman and Morgan to expand retail banking offerings and give ongoing access to the Fed’s discount window, but will place the firms under additional regulatory oversight from the Federal Reserve.
In corporate news, there were several share repurchase program announcements this morning. Microsoft (MSFT 25.39, +0.23) announced an additional $40 billion share repurchase program and raised its quarterly dividend by 18% to $0.13 per share. Hewlett-Packard (HPQ 47.06, -1.20) authorized an additional $8 billion for share repurchases. Nike (NKE 63.06, -0.64) announced a four-year $5 billion share repurchase program.
The amount of spending in the government’s plan to help financial firms sparked a sharp decline in the dollar. The Dollar Index fell 2.3%, with the euro gaining 3.0% against the dollar. This prompted buying interest in commodities (+3.9%).
Crude oil futures traded in an extremely volatile manner. The crude oil contract for October delivery, which expired today, spiked as high as 24% to $130 per barrel, before settling with a 15% gain at $120.00. Oil for November delivery, which becomes the front-month contract tomorrow, rallied 5.6% to $108.50 per barrel, but saw gains much smaller than October.
The outsized gains of the October delivery oil contract suggests that a massive short-covering rally played a role in the advance.

Purchasing Manager Index Manufacturing (September) 48.1

Resistance 3: Y108.00
Resistance 2: Y107.20
Resistance 1: Y105.60
Current price: Y105.56
Support 1: Y105.10
Support 2: Y104.00
Support 3: Y103.40
Comments: The dollar fell for a second day against the yen on concern a U.S. proposal to buy $700 billion of troubled assets will erode investor confidence in the nation's finances. Resistance is around session high on Y105.60, then – at yesterday’s high on Y107.20. Stronger level remains at Friday’s high on Y108.00. Support is around session low on Y105.00/10 (also last Thursday’s low) and then – to stronger support at Y103.40 (trend line from Mar 17).

Resistance 3: Chf1.1280
Resistance 2: Chf1.0980
Resistance 1: Chf1.0820
Current price: Chf1.0795
Support 1: Chf1.0680
Support 2: Chf1.0610
Support 3: Chf1.0240
Comments: USD/CHF also fell before U.S. reports this week that may show home sales slowed, adding to the case for the Federal Reserve to lower interest rates. Home resales declined to 4.94 million last month from 5 million in July, according to a survey of economists. The National Association of Realtors' report is scheduled for release tomorrow. The Commerce Department will report the next day that sales of new houses dropped to 510,000 from 515,000, a separate survey indicated. Support is around yesterday’s low on Chf1.0680. Break under will lead the dollar to May hifhs on Chf1.0600/10. Key support is around Chf1.0240 (trend line from Mar 17. Resistance comes at 23.6% of the decline from Friday’s high on Chf1.1280 – at Chf1.0820/30. Neat band of resistance comes at 50% Fibo on Chf1.0980.

Resistance 3: $1.8940
Resistance 2: $1.8800
Resistance 1: $1.8620
Current price: $1.8560
Support 1: $1.8460
Support 2: $1.8360
Support 3: $1.8280
Comments: GBP/USD set stable Tuesday after yesterday’s gain, testing the 12-days channel resistance line between $1.8620/40. Break above will open the way to Aug 21 high on $1.8800 and then – to $1.9040 (Aug 13 high). Support comes near 23.6% Fibo of the rise from $1.7920 to yesterday’s high on $1.8640 – on $1.8460. Below losses may widen to $1.8360 and key level - $1.8280 (50%).

Resistance 3:$1.5080
Resistance 2: $1.4950
Resistance 1: $1.4860
Current price: $1.4784
Support 1: $1.4700
Support 2: $1.4580
Support 3: $1.4500
Comments: EUR/USD rose for a fifth day, its longest losing stretch since February, as Treasury Secretary Henry Paulson's plan would increase the nation's debt ceiling by 6.6 percent to $11.315 trillion. The dollar reached $1.6038 per euro on July 15, the weakest since the European currency's 1999 inception. Euro tested 12-days channel resistance line between $1.4840/60 yesterday, but failed to break above and retreated a bit. Minor support comes at 23.6% Fibo (rally from $1.4150 to $1.4860) - $1.4700. 38.2% Fibo of the $1.6030 - $1.3870 move also comes here. Break under will accelerate the retreat to 38.2% on $1.4580/90 and then to key support on $1.4500/05 (50% of the $1.4150 - $1.4860 move). Above $1.4840/60 there is a chance to recover up to $1.4950 (50% of the $1.6030 - $1.3870 decline) with further resistance is near $1.5080 (Aug 11 high).

High Low Close
EUR/USD 1.4866 1.4435 1.4796
USD/JPY 107.18 105.11 105.43
GBP/USD 1.8639 1.8262 1.8579
USD/CHF 1.1052 1.0688 1.0725

EUR/JPY 156.82 153.79 156.02
EUR/GBP 0.7976 0.7883 0.7962
GBP/JPY 197.14 194.26 195.21
GBP/CHF 2.0263 1.9901 1.9929

Change % Change Last
Nikkei +169.73 +1.42% 12,090.59
Topix +19.57 +1.70% 1,168.69
FTSE -75.04 -1.41% 5,236.26
DAX -81.78 -1.32% 6,107.75
CAC -101.36 -2.34% 4,223.51
Dow -372.75 -3.27% 11,015.69
NASDAQ -94.92 -4.17% 2,178.98
S&P -47.99 -3.82% 1,207.09
10yr Note +0.5500 +0.146% 3.824%
NYMEX Crude Oil +16.37 +15.66% 120.00
Gold +44.30 +5.12% 909.00

00:00 Japan Autumn Equinox Day
02:00 New Zealand Westpac Consumer Confidence (3Q) 81,7
07:30 Germany Purchasing Manager Index Manufacturing (September) 49,0 49,9
07:30 Germany Purchasing Manager Index Services (September) 51.0 51,4
08:00 Е15 Purchasing Manager Index Services (Sep) 48,1 48,5
08:00 Е15 Purchasing Manager Index Manufacturing (Sep) 47,3 47,5
08:30 UK BBA Net Mortgage Lending (August), bln 4.3
09:00 Е15 Industrial orders (July) Y/Y 7,4%
09:00 Е15 Industrial orders (July) -0,3% -0,3%
11:00 Canada Consumer Price Index (YoY) (Jul) 3.4%
11:00 Canada Consumer Price Index (MoM) (Jul) 0.3%
11:00 Canada Bank of Canada Consumer Price Index Core (YoY) (Aug) 1,5%
11:00 Canada Bank of Canada Consumer Price Index Core (MoM) (Aug) 0,1%
14:00 USA Housing Price Index (MoM) (Jul) 0.0%