Finance and Economic

Total U.S. money market mutual fund assets fell $14.68 billion to $2.679 trillion for the week ended Wednesday, Investment Company Institute said.

Assets of the nation’s retail money market mutual funds fell $5.73 billion to $929.14 billion, the Washington-based mutual fund trade group said. Assets of taxable money market funds in the retail category fell $3.89 billion to $733.47 billion. Tax-exempt retail fund assets fell $1.84 billion to $195.67 billion.

Meanwhile, assets of institutional money market funds fell $8.95 billion to $1.750 trillion. Among institutional funds, taxable money market fund assets fell $8.13 billion to $1.653 trillion; assets of tax-exempt funds fell $820 million to $96.20 billion.

The seven-day average yield on money market mutual funds was 0.02 percent in the week ended Tuesday, unchanged from the previous week, said Money Fund Report. The 30-day average yield was also unchanged at 0 guaranteed online personal loans.02 percent.

The seven-day compounded yield was flat at 0.02 percent, as was the 30-day compounded yield at 0.02 percent, Money Fund Report said.

The average maturity of the portfolios held by money market mutual funds was unchanged from the previous week at 44 days.

Bankrate.com said its survey of 100 leading commercial banks, savings and loan associations and savings banks in the nation’s 10 largest markets showed the annual percentage yield available on money market accounts was unchanged at 0.13 percent from the previous week.

Bankrate.com said the annual percentage yield on six-month certificates of deposit was unchanged from the previous week at 0.22 percent.

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The stock market has had an impressive January. The staid companies that make up the Dow Jones industrial average have gained 4 percent in three weeks, and the broader market has done even better.

But the Nasdaq composite _ a collection of technology stocks whose dot-com heyday was more than a decade ago _ has left them both in the dust.

That’s no surprise when you consider tech stocks took a licking last year. Tech companies tend to carry more risk _ a problem for the Nasdaq during last year’s market gyrations. As investors regain confidence in the economy, riskier plays are doing well.

But experts say the Nasdaq’s gains reflect long-term currents that could lift tech stocks through 2012 and beyond. Many companies put off replacing worn-out technology during the recession. To compete and survive, they need to invest in tech.

There’s also a growing global market for technology as more nations try to reduce labor costs by automating everything from factories to cash registers.

And the biggest tech companies face less competition these days when they try to acquire smaller companies. Many of their mid-sized rivals for those deals were weeded out after the dot-com bust and the financial crisis.

In the market for mergers and acquisitions, established players like IBM and Oracle can be picky about buying only those companies that will increase their earnings _ and probably their stock prices.

In other words, it’s not all about Microsoft-style titans and trendy social media companies like LinkedIn and Zynga. The Nasdaq contains more than 3,000 companies, many of them relative startups compared with the companies in the Standard & Poor’s 500 index.

For the year _ just 13 trading days old _ the Nasdaq composite is up 7 percent, compared with 4.6 percent for the S&P 500 and 4.1 percent for the Dow.

“It looks like it’s going to be their year, or at least their month,” says Michael Vogelzang, chief investment officer at Boston Advisors LLC.

The Nasdaq sank 1.8 percent last year, while the Dow rose 5.5 percent and the S&P was flat. That left tech stocks relatively cheap, giving them more space to rise as the broader market rallied. Oracle is up 11.9 percent this year, Microsoft 14.5 percent.

Vogelzang and others say the tech rally has further to go.

“If you want to make your company more productive, you have to turn to the world of technology for that,” says Kim Caughey Forrest, senior analyst with Fort Pitt Capital Group.

She expects the S&P 500’s tech sector to outperform the broader market because of strong demand from U.S. companies, developing nations such as China and even cash-strapped European governments. As China’s banking system exploded to serve a growing middle class, banks there spent big on IBM technology, she noted.

“Nobody questions whether they need the latest and greatest technology anymore. They know they need to keep up their technology spending,” says Eric Gebaide, managing director of Innovation Advisors, a tech-focused investment bank and strategic advisory firm.

Gebaide and others mentioned many companies’ efforts to move their computing and data storage off-site _ trends known as “cloud computing” and “virtualization.” Long-distance computing is cheaper, but it requires technology.

But why are tech stocks rallying now? The cloud computing transition has been under way for years, and spending by companies has driven much of the U.S. recovery since the economy emerged from recession in June 2009.

It’s all about the investment cycle, says Jack Ablin, chief investment officer with Harris Private Bank. He says investors are finally willing to “flex their speculative muscles in a market that isn’t falling apart in the way they feared last year.”

Last year, some of the best-performing stocks were consumer staples and utilities _ lower-risk industries where demand is consistent even the economy is slow. This year, utilities in the S&P are down 3.7 percent, while tech companies are up 6 percent.

The move out of so-called defensive stocks, the ones you want to own in a slow economy, is a sign that investors are willing to embrace risk again.

“You’re getting this big market rotation,” Vogelzang says. “People made money last year in the boring, stable industries, and they’re saying, `Hey, I better get on this economy train while I can.’”

Tech companies learned hard lessons from the dot-com bust of the early 2000s and the 2008 financial crisis, says Gebaide of Innovation Advisors. They hold more cash than most types of companies and carry less debt. That leaves them less vulnerable to bankruptcy or a loss of investor confidence.

Given its twice-stung discipline, tech is positioned to drive the economy _ “perhaps the best it has been as a sector in the past 20 years,” Gebaide says.

The biggest threat to the industry, Gebaide says, is a slowdown in the early investment that helps startups grow into viable companies. Those early dollars used to offer massive returns to savvy investors when a good pick went public.

Today, the upside for venture capitalists is limited because far fewer companies are going public in big stock offerings. The bar is much higher after dot-com era debacles like Pets.com. Before underwriting a deal or buying chunks of stock, banks and investors want to see millions in annual revenue and established customer bases. It’s tough for younger tech companies to meet those standards.

Peter Falvey, managing director of Morgan Keegan Technology Group, says there’s plenty of capital, entrepreneurship and good ideas to keep companies’ bottom lines _ and stock prices _ rising.

Falvey’s group specializes in tech mergers and acquisitions _ the kinds of deals that allow IBM or Oracle to bring a small competitor’s product to a wider audience and add to their own earnings. Last year was the best for M&A in his group’s 11-year history, and this year’s deal pipeline already is stronger than last year’s was at this time, he says.

A company like IBM “has huge amounts of capital and a global customer base, plus complete hardware-software services,” Falvey says. “Once you put a small company into that machine, IBM can do really well with it.”

The industry’s earlier downturns also helped big companies by weeding out smaller players. The number of publicly traded tech companies has decreased by a third since 2000, Gebaide says. Now the big dogs can pick and choose more carefully, acquiring only businesses that are almost certain to increase their profits.

To be sure, high-tech companies are higher-risk investments, and they could lose value quickly if the market tanks because of a debt catastrophe in Europe or something unforeseen.

“People love tech until we get an economic shock, or negative economic statistics start to come out,” Vogelzang says. “Then all of a sudden, people will say, `Whoa, I need to go buy some utilities again.”

But investors should take tech’s success at this stage as a promising sign, says Ryan Detrick, senior technical strategist with Schaeffer’s Investment Research. He says higher-risk bets like tech stocks tend to rise as the market enters a phase of long-term growth.

Housing, tech and small-company stocks all have risen faster than broad indexes since October, Detrick says. Those sectors are sensitive to improving economic data, he says.

“When you start to see tech taking charge, that’s definitely a potential step in the right direction for future gains, potentially for the whole year,” Detrick says. “Those are the sectors you want to see lead a bull market.”

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NATO warplanes bombed three Libyan state TV satellite transmitters in Tripoli overnight, targeting facilities that have been used to incite violence and threaten civilians, the military alliance said Saturday.

A series of loud explosions echoed across the capital before dawn. There was no immediate comment from Libyan officials on what had been hit, but state TV was still on the air in Tripoli as of Saturday morning.

NATO said the airstrikes aimed to degrade Libyan leader Moammar Gadhafi’s “use of satellite television as a means to intimidate the Libyan people and incite acts of violence against them.”

“Striking specifically these critical satellite dishes will reduce the regime’s ability to oppress civilians while (preserving) television broadcast infrastructure that will be needed after the conflict,” the alliance said in a statement posted on its website.

It said Gadhafi’s inflammatory TV broadcasts were intended to mobilize his supporters.

In addition to the three TV transmitters, during the past 24 hours alliance aircraft targeted military vehicles, radars, ammunition dumps, anti-aircraft guns, and command centers near the front lines in the east and west, NATO said in a statement.

The attempt to silence the government’s TV broadcasts comes at a sensitive time for the rebels, who appeared to be in disarray after the mysterious death of their chief military commander. Abdel-Fattah Younis’ body was found Thursday, dumped outside the rebels’ de facto capital of Benghazi, along with the bodies of two colonels who were his top aides. They had been shot and their bodies burned.

NATO too has been increasingly embarrassed by the failure of its bombing campaign, now in its fifth month, to dislodge Gadhafi’s regime. With the fasting month of Ramadan due to start in August, there is growing realization within the alliance that the costly campaign will drag on into the autumn and possibly longer.

NATO had originally hoped that a series of quick, sharp strikes would quickly force Gadhafi to give up power. The alliance has carried out about 6,500 strike sorties and a total of 17,000 sorties since March.

Eight NATO members have been participating in air campaign in Libya: the U.S., Britain, France, Belgium, Canada, Norway, Denmark and Italy. They have carried out a total of more than 6,500 strike sorties.

But this coalition has been gradually fraying amid growing public opposition in Europe to the costs of the campaign _ estimated at more than a billion euros _ at a time of budget cuts and other austerity measures.

The United States was the first to limit its participation, deciding to only provide support to the European allies. Then Italy withdrew its only aircraft carrier and part of its air force contingent. Meanwhile, Norway has announced it will pull all of its F-16 warplanes out of the operation by Monday.

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Fitch ratings agency said Friday that it will put a default rating on Greece’s government bonds as a result of the eurozone’s new plan to get banks to share the burden of helping the country.

The eurozone plan says banks will be asked to contribute billions to Greece by rolling over debt, swapping bonds or selling them back at low prices.

As expected, Fitch said that because that would mean a loss for those banks, it will lower Greece’s rating to “restricted rating.” That rating could be lifted, however, as soon as Greece issues new bonds to the banks.

Those new bonds would be guaranteed by eurozone governments.

The banks’ contribution is part of a broad deal to help Greece.

The country will get euro109 billion ($156 billion) in new financing in a complex package that includes new loans, buybacks of Greek debt, and credit guarantees under the deal agreed Thursday by the leaders of the 17 countries that use the euro.

The European plan will help ease Greece’s burden by cutting interest rates and extending repayment on bailout loans, and by asking Greek bondholders such as banks and investment and pension funds to accept less than the full value of their investments through bond swaps and rollovers. Those transactions will give them bonds that pay less interest _ around 4.5 percent on average _ over a much longer period of 30 years.

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Italian markets are buoyant on expectations that the Senate will approve a package of austerity measures that is key to shoring up confidence in the country’s financial future.

The benchmark FTSE MIB was up 0.5 percent, the only European index to trade higher Thursday morning.

Italy’s finance minister has vowed that the austerity measures, which aim to balance the budget by 2014, will get final approval by the lower house of parliament on Friday.

The government fast-tracked the approval _ from an original deadline of August _ to soothe jittery markets.

Italy will also hold its second bond sale this week, seeking to raise euro5 billion ($7 billion) in 5- to 15-year bonds from the markets. Italy easily raised euro6.75 billion in 12-month debt on Tuesday, though at higher rates.

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The Canadian housing market is due for a correction, but it will likely be a slow decline rather than a sharp drop, says a report from the Canadian Imperial Bank of Commerce.

French Finance Minister Christine Lagarde is expected to be chosen as early as Tuesday to be the new leader of the International Monetary Fund.

Lagarde would be the first woman to lead the lending organization. She would replace Dominique Strauss-Kahn, who resigned last month after being charged with sexually assaulting a New York City hotel housekeeper. Lagarde was opposed by Agustin Carstens, a Mexican central banker whose candidacy never caught fire, even among developing countries.

Lagarde has broad support in Europe payday loans guaranteed no fax. And a high-ranking Chinese official said Monday that Beijing supports Lagarde, according to several reports.

U.S. officials haven’t publicly backed any candidate. But most analysts expect the Obama administration to support Lagarde. Combined, the United States, Europe and China hold a majority of votes on the IMF’s board.

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U2 and its frontman Bono, known for their global poverty-fighting efforts, were accused of dodging taxes in Ireland by activists who crashed their performance Friday at England’s Glastonbury festival.

The anti-capitalist group Art Uncut inflated a 20-foot (6-meter) balloon emblazoned with the message “U Pay Your Tax 2.” Security guards wrestled them to the ground before deflating the balloon and taking it away. About 30 people were involved in the angry clash.

Bono fan Gary Noble, 45, said he found the security reponse “all a bit shocking.”

“I love U2 but I think everyone should pay their taxes. The campaigners have a right to voice their opinion,” he said.

Art Uncut argues that while Bono campaigns against poverty in the developing world, his group has avoided paying Irish taxes at a time when his austerity-hit country desperately needs money.

Ireland, which has already accepted an international bailout, is suffering through deep spending cuts, tax hikes and rising unemployment as it tries to pull the debt-burdened economy back from brink of bankruptcy.

“Tax(es) nestling in the band’s bank account should be helping to keep open the hospitals, schools and libraries that are closing all over Ireland,” Art Uncut member Charlie Dewar said ahead of the protest.

U2, the country’s most successful band, was heavily criticized in 2006 for moving its corporate base from Ireland to the Netherlands, where royalties on music incur virtually no tax payday loans.

Bono, guitarist The Edge and U2’s other members _ bassist Adam Clayton and drummer Larry Mullen _ are among the country’s wealthiest residents. Forbes magazine has estimated the band earned $195 million last year, mostly through its hugely profitable “360 Degrees” world tour.

It’s not known how much personal income tax the band members pay in Ireland.

During the years when Ireland was a booming “Celtic Tiger” economy, the members of U2 invested in a wide range of Dublin properties, including a luxury riverside hotel and a planned Norman Foster-designed skyscraper on the River Liffey. Plans for the “U2 Tower” were shelved when property prices collapsed in 2008.

U2 is headlining the first night of the three-day Glastonbury festival, its first appearance at Britain’s most prestigious summer music event. The band was due to perform last year but had to pull out after Bono injured his back.

Some 170,000 people have descended on a farm in southwest England for the extravaganza, which includes sets by Morrissey, Mumford & Sons, Coldplay, Beyonce and scores of other acts.

Rubber boots are the fashion item of choice after heavy rain turned the 900-acre (364-hectare) site into a mudbath. More rain is forecast for later Friday.

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A round of confidence-building corporate deals supported global stocks Tuesday, despite fresh tightening measures in China as inflation there jumped to a three-year high and another savage credit rating downgrade of Greece.

Over the past two months, the economic news flow has turned distinctly negative, particularly from the U.S., and many investors think the surge in share prices in the early part of the year may have been overdone.

Some relief came from corporate deals that prompted investors to look for potential takeover targets. In particular, news that Avis Budget has agreed to buy its European counterpart Avis Europe in a $1 billion deal has helped fuel hopes that further corporate activity will emerge in the days to come, especially now that many companies have shored up their cash positions following the recession.

“Companies with healthy balance sheets are clearly looking for sound investments,” said Will Hedden, sales trader at IG Index.

Though Avis Europe is not part of the FTSE 100 of leading British shares, its takeover helped buoy sentiment and the index was up 0.4 percent at 5,797. Germany’s DAX was 1.6 percent higher at 7,197 while the CAC-40 in France rose 1 percent to 3,846.

Wall Street was poised for a solid opening, too _ Dow futures were up 0.6 percent at 11,954, while the Standard & Poor’s 500 futures rose 0.8 percent to 1,276.

How the U.S. opens could well hinge on retail sales figures, which are released an hour before the bell. U.S. retail sales figures for May will provide an insight into the state of the U.S. economic recovery _ consumer spending accounts for around 70 percent of the U.S. economy.

Expectations are not rosy. The headline figure is expected to show a monthly 0.4 percent decline, which if true would represent the first decline since last June. However, when car sales are stripped out, U.S. retail sales are expected to rise by 0.3 percent.

In currency markets, investors continue to monitor developments surrounding the Greek debt crisis ahead of next week’s meeting of eurozone finance ministers in Brussels, where a fresh Greek bailout is on the agenda.

An unscheduled meeting of the eurogroup ministers Tuesday has stoked speculation that they are preparing to work out a way for the private sector to increase its share in helping Greece, a move the European Central Bank has so far opposed. The meeting takes place just a day after Standard & Poor’s downgraded its rating on Greece’s debt to triple C, the lowest of any sovereign in the world.

Tuesday’s meeting takes place amid signs that policymakers in Europe have divergent views on how to deal with the Greek crisis, with the European Central Bank and the German government, in particular, at odds on getting Greece’s bondholders to share the burden of the bailout.

By late morning London time, the euro was 0.2 percent firmer at $1.4439.

Earlier in Asia, Japan’s Nikkei 225 index rose 1.1 percent to close at 9,547.79 while South Korea’s Kospi rose 1.4 percent to 2,076.83. Hong Kong’s Hang Seng fell less than 0.1 percent to 22,496.

In mainland China, shares advanced after the government announced that inflation in May was 5.5 percent. Though that was the highest in almost three years, it was not as high as some forecasts had suggested. The benchmark Shanghai Composite Index gained 1.1 percent to 2,730.04, while the Shenzhen Composite Index of China gained 1.6 percent to 1,128.42.

Even though headline inflation did not rise as much as anticipated, China’s central bank increased the reserves banks are required to hold by a further 0.5 percentage point to a record 21.5 percent of deposits. The sixth increase this year is designed to help keep a lid on inflation.

There was some relief in the markets that China did not raise interest rates though that is expected to happen again soon.

“Although Chinese tightening is not generally welcomed by the markets, a gradual slowdown in the economy is a far better scenario than a hard-landing,” said Jane Foley, an analyst at Rabobank International.

Oil prices recouped some recent lost ground though fears over the pace of the global recovery remain.

Benchmark crude for July delivery was up 99 cents to $97.39 in electronic trading on the New York Mercantile Exchange.

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Pamela Sampson in Bangkok contributed to this report.

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Conrad Black is contesting the testimony of two prison workers who said he shirked tutoring responsibilities and used other inmates as servants during his time at a Florida prison, as his conduct behind bars comes under scrutiny ahead of his resentencing later this month.

Affidavits by two employees filed with a U.S. federal court in Illinois suggest the former media baron wasn’t the model inmate his defence team has painted him to be in its petition to the court arguing that Black should not return to jail.

The scathing reports will be considered when Judge Amy St. Eve, who presided over Black’s original trial in 2007, hears arguments later this month on whether Black should return to jail on two remaining convictions.

But Black said Monday the officials’ testimony is at odds with evidence from other sources provided to the Probation Office and “will be rebutted at the appropriate time by appropriate people.”

“They are indicative of the deterioration of the government’s case …, ” he said in an email to The Canadian Press.

In one of the affidavits, a unit manager at the Coleman complex says Black demanded special treatment and gathered an entourage of inmates who acted like servants for him.

“Those inmates cooked for Black, cleaned for him, mopped his floor, ironed his clothes and other similar tasks. That is not at all frequent at Coleman,” Tammy Padgett said in the document.

She added that Black’s assigned case manager reported that he demanded to be called Lord Black the day he was released on bond last summer, awaiting the outcome of an appeal.

“Black told (her) words to the effect of ‘I believe I should be addressed as Lord Black from this point forward,’” she said.

In another document, Carrie De La Garza, an education specialist who supervised Black as a tutor, claimed he was a haughty and uninterested mentor.

“He projected the attitude that he was better than others in the class, both faculty and students. A lot of the inmates looked up to him, and there were some who saluted him each day in class,” she said in the sworn testimony.

De La Garza claimed Black was frequently late and often read or worked on writing what appeared to be a book while he was supposed to be teaching.

“In addition, Black elected to take a piano class, which caused him to miss parts of the GED (General Educational Development) classes. Of the three tutors assigned to my class during the time Black was an inmate at Coleman, Black put in the fewest hours,” she said.

De La Garza’s depiction of Black’s time as a tutor disputes his defence team’s claims, which argue in its court filings that his contributions to the community “were nothing short of extraordinary.”

“Few indeed could take credit for guiding more than 100 GED candidates to graduation, and Mr. Black’s work with his colleagues to more than double the number of graduates (including several who had been written off as hopeless causes) is truly commendable when one considers the very difficult circumstances he faced,” the defence filing said.

However, De La Garza refuted the claim with figures showing there had been no increase in the graduation rate of the prison’s students, instead saying there has been a decline to 81 in 2010 from 87 in 2007.

Black’s lawyer, Miguel Estrada, earlier filed documents in advance of Black’s resentencing that tout his contributions to the community during his 2.5 years at Coleman, and his continuing support of those students since his release last summer.

“Mr. Black stared into the darkest and most devastating period of his life and found the power to improve the lives and opportunities of those whom he encountered,” the filing said.

“He did so quietly, humbly, and with no effort to draw attention or praise to his accomplishments.”

Black, who had been serving a 6.5-year sentence in the U.S. federal prison, has been freed since last summer after the U.S. Supreme Court curtailed the “honest services” laws used to convict Black of defrauding Hollinger International investors.

An appeals court subsequently reversed two convictions, but upheld two others — on fraud and obstruction of justice. He is scheduled to be resentenced on those charges June 24.

The Supreme Court rejected an appeal of those convictions last week, meaning Black won’t be cleared of the charges, but could remain free if the judge decides to allow him time served on the counts.

The U.S. Attorney believes Black’s original sentence of 6.5 years should be reimposed.

Black’s empire once included the National Post, Chicago Sun-Times, The Daily Telegraph of London and other papers across the United States and Canada.

The Canadian-born businessman was freed on bail from a Florida prison last year while he appealed his conviction for defrauding investors. He had served 29 months of a 78-month sentence for the original four convictions.

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