Money world

U.S. stocks were set to open higher Friday, as investors mulled over strong earnings reports and currency tensions at a summit of the world’s major economies.

After hovering around breakeven, Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures turned higher about an hour before the opening bell Friday. Futures measure current index values against perceived future performance.

Stocks are coming off gains Thursday, as investors balanced strong earnings with heightened speculation that the Fed’s next round of asset-buying won’t be as dramatic as anticipated.

The two-day Group of 20 finance and central bank meeting kicked off Friday in South Korea, with tensions about a so-called currency war brewing.

In a widely reported letter to the G-20 nations, U.S. Treasury Secretary Timothy Geithner urged some developing countries to stop keeping their currencies artificially low, and cap their surpluses or deficits to rebalance the world economy.

"You have Geithner talking about the importance of the strength of the U.S. dollar; others talking about what they’re going to do to avoid a currency war. It has some below-the-fold influence on markets," said Mark Luschini, chief investment strategist with Janney Montgomery Scott.

"This is a lot of rhetoric leading into what will be talked about this weekend, but nothing really matters until we see a formal announcement come out early next week," he added.

U.S. officials have been pushing China to allow its currency, the yuan, to rise against the dollar and level the international export playing field.

Companies: After Friday’s market close, Amazon (AMZN, Fortune 500) posted a 39% jump in sales and third-quarter earnings per share of 51 cents — topping the 48 cents expected by analysts. But the stock fell 3.6% in premarket trading Friday.

Shares of AIG (AIG, Fortune 500) rose 1.5% in premarket trading, after reports said the insurance giant sold its Asian life unit for $17.8 billion in a share offering.

AIG has said that it considers the sale of AIA — one of it’s crown jewels — to be a crucial component of its effort to repay the bailout it took from the U.S. government.

KeyCorp (KEY, Fortune 500) shares rose 3.5% after the the Ohio bank announced its third-quarter income rose to $163 million. The company posted a $422 million loss in the same quarter last year.

Honeywell (HON, Fortune 500) reported third-quarter sales rose to $8.4 billion, but earnings declined. Shares rose 0.2% in premarket trading.

Shares of Schlumberger (SLB) rose 1.5%, after the oilfield services company reported a rise in both third-quarter profit and revenue.

Shares of Verizon (VZ, Fortune 500) fell 0.5% after the company reported third-quarter earnings per share of 31 cents, down from 41 cents per share a year earlier. The results included 25 cents per share in non-operational charges, much of which was related to pension settlements.

World markets: European stocks were mixed in midday trading. Britain’s FTSE 100 fell 0.2%. The DAX in Germany and France’s CAC 40 both rose about 0.1%.

Asian markets ended the session mixed. The Shanghai Composite fell 0.3%, while the Hang Seng in Hong Kong fell 0.6%. Japan’s Nikkei rose 0.5%.

Currencies and commodities: The dollar fell against the euro, the British pound and the Japanese yen.

Oil for December delivery rose 89 cents to $81.45 a barrel.

Gold futures for December delivery fell 80 cents to $1,325 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield down to 2.58%.  

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Shares of department store operator JC Penney eased Monday after the company adopted a plan to combat an activist shareholder.

Shares of Plano, Texas-based Penney (JCP, Fortune 500) slipped more than 2% to $33.11 in late trading after falling as low as $32.47 earlier in the session.

Pershing Square, a large hedge fund run by activist investor Bill Ackman, disclosed in regulatory filings last week that it owns 16.5% of Penney’s common stock. In a separate filing, Vornado Realty Trust, a Maryland real estate investment trust, said it holds a 9.9% stake in the retailer’s common stock.

The adoption of the plan,also known as a poison pill, came "in light of recent rapid accumulations of a significant percentage of the company’s outstanding common stock," Penney said in a regulatory filing.

The plan kicks in if any person or group buys more than 10% of the company’s common stock, or tries to expand existing stakes beyond 10%, according to the filing. It has a life span of one year.

Despite the dip on Monday, shares of Penney have been on a tear since falling to a low of $19.50 in late August. The stock is up nearly 24% so far this year.

The disclosures raised speculation that Ackman, who was involved in a drawn-out proxy battle with Target (TGT, Fortune 500) last year and forced the sale of fast-food giant Wendy’s, will shake things up at Penney.

Analysts at Barclay’s Capital said last week that they remain optimistic about Penney’s sales growth, but downgraded the stock to "equal weight" from "overweight" on unspecified distractions ahead of the key holiday shopping period.

"As we are heading into the important holiday selling season, where the company earns almost two-thirds of its annual profits, we are concerned that management may be distracted and miss an opportunity for sales and profit gains," Barclays analysts wrote.

Same-store sales, an important gauge of a retailer’s health, increased 5.1% for the five-week period ended Oct. 2, the company said, topping its own expectations.

Morningstar analysts said in a research report that they do not expect Pershing Square to make a significant impact on J.C. Penney’s operations, though they acknowledged that "financial engineering" remains a possibility.

"We do think Pershing will shake things up," the Morningstar analysts said. "At a minimum, we believe real estate will be one of the ways Pershing will attempt to increase the value of its stake." 

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Shares of The McClatchy Co. plummeted more than 7 percent in trading Friday, after a competitor announced a decline in newspaper advertising revenue and a dismal outlook for the hard-hit industry .

Gannett Co. Inc. (NYSE: GCI) enjoyed a 37 percent increase in third-quarter earnings, but a 5 percent plunge in print advertising sales, about 90 percent of the McLean. Va-based company’s revenue. The company is the nation’s largest newspaper chain, with more than 80 newspapers and also operates broadcast stations, including News10 in Sacramento.

The company, publisher of USA TODAY, had its shares fall 9 percent Friday.

In addition, Moody’s Investors Service downgraded its outlook from “stable” to “negative” for the newspaper industry Thursday, citing concerns about declining revenue.

McClatchy — publisher of The Sacramento Bee and 29 other daily newspaper — had its shares follow, plunging 7 percent in slightly lower-than-average trading volume. The company’s stock fell 29 cents to $3.56, its lowest price since Sept. 17.

The Bee has eliminated more than 300 jobs in five rounds of staff cuts in the past 2 1/2 years, including sports editor Bill Bradley, who reportedly left the daily newspaper Friday.

McClatchy has cut more than 4,150 newspaper jobs since June 2008, including layoffs in recent weeks at The Miami Herald, Charlotte Observer and Kansas City Star.

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The Kansas Bioscience Authority on Monday awarded $9.5 million in financing, most of which will go to the University of Kansas Cancer Center.

The Cancer Center will receive a total of $9.17 million during the next five years to bring five scholars to the program.

More than $2 million of that will be used to bring on Dr. Kapil Bhalla as the center’s deputy director and professor of internal medicine. Bhalla comes from Medical College of Georgia and specializes in novel therapeutics for lymphoma, leukemia and breast cancer.

KU Cancer Center will receive another $1.45 million to bring Dr. Shrikant Anant from the University of Oklahoma. Anant will serve as the center’s associate director for prevention and professor of molecular and integrative physiology. His research focus is gastrointestinal cancer.

Both Bhalla and Anant were named eminent scholars by the KBA. The organization’s eminent scholars program is designed to help recruit world-class and established people who have received national recognition for their research, accomplishments and ability to get significant amounts of federal funding every year, according to the KBA website. The KBA provides financing that must be matched by the proposing institution.

“If you look at just our eminent scholars program alone, $4.5 million in KBA funds expended have been used to attract $52.8 million in external funding to Kansas,” Tom Thornton, KBA president, said in a release. “This work is paying off big and will result in new discoveries that will drive economic growth and improve health care throughout Kansas.”

The KBA also awarded the center $5.67 million during the next five years to attract three more scholars, currently unnamed. The scholars will serve as associate directors of translational research, basic science and Phase I trials.

Combined, the five scholars receive $1.7 million each year from the National Cancer Institute. Employing scholars with NCI funding is a critical step in gaining NCI designation, which the KU Cancer Center plans to apply for in September of next year.

So far this fiscal year, the KBA has contributed $10.8 million to KU Cancer Center to help attract high-profile scholars to the Kansas City, Kan., campus in an effort to enhance the center’s NCI bid. That includes the Monday awards plus $780,000 during three years to bring on Dr. Liang Xu and $850,000 during five years to bring on Dr. Daotai Nie.

The KBA also approved a $347,550 investment in Orbis Biosciences, based in Kansas City, Kan., to support Orbis’ development and commercialization. The financing is a partial match to a National Institutes of Health Small Business Innovation Research grant worth $695,173, according to the release.

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Two Charlotte companies — Red F Marketing and Charlotte Studios — are seeking a combined $38.1 million in federal bond funding for development projects.

Red F wants $5.1 million to buy and rehabilitate office space in uptown Charlotte. Its location has not been released.

Charlotte Studios seeks $33 million to build a film studio in Charlotte.

The companies will request the bond money at a meeting of the Industrial Facilities and Pollution Control Authority on Wednesday at the government center.

The authority oversees applications for Recovery Zone Facility Bonds. The $25 billion U.S. Department of Treasury program was created by the American Recovery and Reinvestment Act.

The financing comes at no risk to the city or county. Instead, municipalities are assigned control over what businesses can access to the funds. The borrower gets low-cost financing and must use the financing for construction or equipment.

The appeal of the recovery-zone bonds is that they are tax-exempt and low-interest, says Marvin Bethune, county attorney.

“I think it’s a great idea,” says John Allen, Mecklenburg County economic development director. “It’s helping a local company to grow and expand, and doesn’t cost local taxpayers a thing.”

Allen says Red F wants to buy and renovate a 10,000-square-foot space.

Red F started in 2000. Sara Garces and Dan Roselli are its top executives. The company generated $38.5 million in capitalized billings in 2009, ranking fourth among local ad agencies, according to Charlotte Business Journal research.

Roselli could not be immediately reached for comment on Friday.

Allen says Red F has considered sites in South Carolina as it looks to relocate from its headquarters in SouthPark. The company has 30 employees.

“What I know is they are currently looking in North and South Carolina,” says Tracy Finch Dodson, Charlotte Center City Partners’ director of economic development. “We want them uptown.”

Less is known about Charlotte Studios. Company executive Sherwood Herndon could not be reached for comment.

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Alaska Airlines said its planes flew fuller last month, as traffic rose nearly 13 percent from September 2009.

Alaska Airlines reported the number of revenue passenger miles (number of revenue-paying passengers multiplied by the distance traveled in miles) rose to 1.64 billion from 1.45 billion in 2009, or an increase of nearly 13 percent. The airline’s available seat miles (number of seats available multiplied by the number of miles flown) rose 7.8 percent to 2 billion from 1.86 billion a year earlier. The number of revenue passengers rose 8.6 percent to 1.34 million from 123 million in 2009, and passenger load factor (percentage of available seats occupied by fare-paying passengers) increased to 81.5 percent from 77.9 percent a year earlier.

At Horizon Air, also a unit of Alaska Air Group Inc payday loans. (NYSE: ALK) of Seattle, revenue passenger miles fell to 193 million from 199 million a year earlier, and available seat miles dropped to 254 million from 270 million. The number of revenue passengers fell to 541,000 from 556,000 a year earlier. Horizon’s passenger load factor rose slightly to 76.1 percent from 73.7 percent in September 2009.

Alaska Airlines improved its on-time performance last month to 90.5 percent from 90 percent a year earlier. Horizon Air’s on-time performance fell to 86.8 percent from 91.3 percent in September 2009.

Alaska Airlines and Horizon Air fly nearly half of the passenger traffic at Seattle-Tacoma International Airport.

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Most local stocks ended the week on a positive note, highlighted by Superior Bancorp.

Superior’s (Nasdaq: SUPR) stock gained 10 percent on Friday to close the week at $1.06.

Other local stocks posted mostly moderate gains on Friday:

Golden Enterprises Inc. (Nasdaq: GLDC) rose up 2.1 percent to close at $3.31.

Colonial Properties Trust (NYSE: CLP) increased 34 cents or 2.1 percent to end at $16.53.

Energen Corp. (NYSE: EGN) rose 83 cents or 1.8 percent to close at $46.55.

Books-A-Million Inc. (Nasdaq: BAMM) gained 12 cents or 2 percent to finish at $6.12.

Regions Financial Corp. (NYSE: RF) lost 1.2 percent to close the week at $7.18.

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It looks like Southwest Airlines will finally land in Dayton.

AirTran Airways will take on the Southwest Airlines name, and policies, once an acquisition is completed.

On Monday, Southwest (NYSE: LUV) announced a deal to buy AirTran Holdings Inc. (NYSE: AAI), the Orlando, Fla.-based parent company of AirTran, for $1.4 billion in a combination of cash and Southwest Airlines’ common stock.

While it is unclear whether Southwest will boost or reduce services — or keep the status quo — at Dayton International Airport, Southwest said it will immediately begin integrating the two carriers once the deal is complete next year.

According to Southwest officials, here’s what AirTran passengers will find under the new Southwest logo:

• No charges for up to two checked bags payday loans in one hour. Currently, AirTrain charges $20 for the first and $25 for the second checked bags;

• No charges for change fees. Currently, AirTran charges $75 for changes made after the purchase; and

• No assigned seats or different services classes. Currently, AirTran offers seat assignments as well as business and coach service classes.

Southwest also plans to rebrand the AirTran fleet with its logo and colors and merge AirTran’s frequent flyer plan with its own.

Including the assumption of debt and capitalized aircraft operating leases, the deal is worth $3.4 billion.

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