July/Aug 2010, Issue #50

Economy Recovering Slower Than Expected

Throughout early July, the market was going up and down with no real direction. As the major firms reported their second-quarter earnings, it seemed that the US economy was not recovering as fast as we had anticipated. Fortunately, the market started rising toward the end of July, providing some encouragement to investors. According to the news, the automakers Ford Motor Company and Toyota Motor Corporation both reported over $2 billion in second-quarter earnings.

Technology and health care companies including IBM, Texas Instruments, Johnson & Johnson and Pfizer all reported not very delightful sales: IBM shares fell 2.76 percent; Texas Instruments was down 3.1 percent; Johnson & Johnson dropped 1.7 percent; and Pfizer shares declined 1.4 percent.

The financial sector, except for Goldman Sachs, appeared to be struggling but doing ok. Goldman Sachs's second-quarter earnings dropped 83 percent, partly impacted by the $550 million settlement with Securities and Exchange Commission due to the fraud suit which accused Goldman of misleading institutional investors who bought financial products related to subprime mortgages. The good news is that Citigroup and Bank of America both reported increased second-quarter earnings. In addition, Morgan Stanley also benefited from a strong trading result in this quarter.

It was also said by The Commerce Department that the amount of new home construction in the US has reached the lowest level since last October. The number of housing starts reflects the outlook of the real estate market, the job market and the confidence among potential consumers. Although the report shows that the number went down, the bright side is that housing starts will probably go up again in August according to home construction registrations.

Furthermore, Ben Bernanke, the chairman of the Federal Reserve Board, spoke on July 21st and said that the unemployment rate might remain being above 7 percent until the end of 2012. He also mentioned that the Federal Government has no immediate plans to support this situation. The Dow Jones Industrial Average fell 109 points after Bernanke made the statement. However, Bernanke said the next day that the central bank will take action if the economy does not continue to improve and the market rebounded by 202 points.

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A Quick Look @ Nokia Corporation (NYSE:NOK)
In every issue we take a quick look at a stock that has been in the news. Feel free to make suggestions as to what stock you would like to see covered next by sending an email to editor@firstrade.com, or the editor will pull a random symbol out of a hat.

In this issue, we are going to take a look at Nokia Corporation (NYSE: NOK). It was announced on Wednesday, July 19th, that the joint venture of Nokia of Finland and Siemens of Germany, Nokia Siemens, is going to buy Motorola's wireless-network equipment division for $1.2 billion in cash. Nokia Siemens expects that this acquisition would strengthen their position in the telecommunication equipment industry and introduce them to the new customers. Motorola also considers this deal as a way to focus on the market of handsets and consumer devices.

Founded in 1865, Nokia Corporation is the world's largest manufacturer of mobile telephones. The Finland based multinational communications corporation has sites for research and development, manufacturing and sales in countries all over the world. Nokia is a public limited liability company listed on the Helsinki, Frankfurt, and New York stock exchanges. Currently, it is the largest Finnish company and very influential to the economy of Finland. Now, let's take a look at some key events of Nokia Corporation:



Key Events:

1. 1865 Fredrik Idestam founded Nokia Ab.
2. 1967 Nokia Ab, Finnish Rubber Works and Finnish Cable works formally merge to create Nokia Corporation.
3. 1981 Nordic Mobile Telephone (NMT), the first international mobile phone network, is built.
4. 1991 Nokia equipment is used to make the world's first GSM call.
5. 1992 Nokia launches its first GSM handset, the Nokia 1011.
6. 1997 The Nokia 6110 is the first phone to feature Nokia's Snake game.
7. 1999 Nokia launches the world's first WAP handset, the Nokia 7110.
8. 2002 Nokia launches its first 3G phone, the Nokia 6650.
9. 2005 Nokia sells its billionth phone - a Nokia 1100 - in Nigeria.
10. 2006 Olli-Pekka Kallasvuo becomes Nokia's President and CEO; Jorma Ollila becomes Chairman of Nokia's board.
11. 2006 Nokia and Siemens announce plans for Nokia Siemens Networks.
12. 2007 Nokia recognized as 5th most valued brand in the world.
13. 2007 Nokia Siemens Networks commences operations.
14. 2008 Nokia acquired OZ Communications and Navteq.
15. 2009 Nokia is listed as the fifth most valuable global brand in the Interbrand/BusinessWeek Best Global Brands list.
16. 2010 Nokia is listed as the 41st most admirable company worldwide in Fortune's World's Most Admired Companies list.
17. 2010 Nokia announced the acquisition of Novarra.