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US stock market daily report (September 27, 2012, Thursday)

Contributed by Millennium Traders

Officially, back in action... the National Football League announced that regular referees will return to the field on Thursday after the league reached a new eight-year deal with the NFL Referees Association. The NFL said the pact marks the longest with game officials in NFL history, per announcement on NFL.com and awaits ratification from the referee membership scheduled for Friday and Saturday in Dallas. NFL Commissioner Roger Goodell temporarily lifted the lockout to allow officials to work on Thursday night's game between the Cleveland Browns and Baltimore Ravens. Behind the National Football League’s lockout of its referees and the wrath of bad calls from the temporary referees, is an effort to replace the referees’ pension plan with a 401(k).

The U.S. government on Thursday cut its calculation of U.S. growth for Q2 to 1.3% from 1.7% in its third and final review, citing less consumer spending and business investment than previously estimated. In the previous quarter, consumer spending rose 1.5% instead of 1.7% as initially forecast. Excluding residential housing, business investment was revised down to a 3.6% increase from 4.2%. The government also said corporate profits climbed $21.8 billion in Q2, compared to a $53.0 billion decline in Q1. During the first three months of the year, the U.S. economy grew at a 2.0% pace.

The U.S. Labor Department reported Thursday that applications for U.S. unemployment benefits dropped 26,000 to a seasonally adjusted 359,000 in the week ended September 22, striking the lowest reading since late July. From two weeks ago based on more complete data collected at the state level, initial jobless claims were revised up to 385,000 from an original reading of 382,000. The average of new jobless claims over the past month declined by 4,000 to 374,000. The four-week average reduces seasonal volatility in the weekly data and is seen as a more accurate barometer of labor-market trends. Labor also said continuing jobless claims - which reflect the number of people already receiving benefits - decreased by 4,000 to a seasonally adjusted 3.27 million in the week ended September 15. Nearly 5.17 million people received some type of state or federal benefit in the week ended September 8, virtually unchanged from previous week. Total claims are reported with a two-week lag.

The National Association of Realtors reported Thursday that pending home sales retreated during August, after hitting a two-year high in July. The pending-home-sales index fell to 99.2 from a upwardly revised 101.9 during July. The NAR initially reported the July index at 101.7. "The performance in month-to-month contract signings has been uneven with ongoing shortages of lower prices inventory in much of the country," said Lawrence Yun, chief economist of the NAR. Pending home sales were up 10.7% compared to the same period in 2011, marking the 15th straight month of year-on-year gains.

The Securities and Exchange Commission on Thursday charged Goldman Sachs & Co. (GS) and one of its former investment bankers, with allegedly giving undisclosed campaign contributions to a former Massachusetts state treasurer who was running for governor at the time. The SEC said the alleged infringement involved so-called “pay-to-play” violations, where campaign contributions or other payments are made in an attempt to influence the awarding of public contracts for securities underwriting business. Goldman Sachs agreed to settle the charges by paying nearly $12 million in fines. The fines include a $3.75 million penalty that is the largest ever imposed by the SEC for Municipal Securities Rulemaking Board pay-to-play violations. Goldman is also required to pay back certain ill-gotten gains of over $7.5 million. According to the SEC’s order against Goldman, Neil Morrison, a vice president in Goldman's Boston office, solicited underwriting business from the Massachusetts treasurer’s office beginning in July 2008. According to the SEC, Morrison was substantially engaged in working on the political campaigns of Timothy Cahill from November 2008 to October 2010. “Morrison at times conducted campaign activities from the Goldman Sachs office during work hours and using the firm’s phones and e-mail,” the SEC said. The SEC said that Morrison’s use of Goldman Sachs work time and resources for Cahill’s campaign activities constituted “valuable in-kind campaign contributions” to Cahill that were attributable to Goldman Sachs and disqualified the bank from “engaging in municipal underwriting business with certain Massachusetts municipal issuers for two years after the contributions.” Despite being disqualified from such underwriting business, Goldman Sachs participated in 30 allegedly prohibited underwritings with state and local Massachusetts issuers of municipal securities and earned more than $7.5 million in fees, the SEC said.