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Wall Street Strategies submits:By David SilverGoing into August's auto sales results, we knew there would be a decline from last year as August 2009 was benefited from the cash for clunkers program. With that in mind, it wasn't as bad as some articles were predicting. One of the headlines include "the worst month for auto sales in 28 years." First thing is it was a stat for the month of August, not any month of the year. That fine print took many by surprise. If you remember back to May, June, and July of last year, the industry seasonally adjusted annual rate of sales (SAAR) was below 10.0 million units, the lowest was 9.2 million. The figure for August 2010 didn't really approach that Armageddon level, but it was one of the worst August's (adjusting for population growth) since World War II. I honestly had hoped we had passed the post WWII comparisons, but apparently not. There were 997,468 sales which equates to approximately an industry SAAR of 11.7 million units.Complete Story »

• Showdown over 3Par. Shares of 3Par (PAR) rocketed 44.6% yesterday as investors bet H-P's (HPQ) $24/share offer will set off a bidding war with Dell (DELL), which earlier in the month had offered $18/share for the company that handles data storage systems and cloud-computing infrastructure. Sources say Dell is already preparing a sweetened offer which could be sent in the coming days, but it's unclear how high the company is willing to go. Analysts say the offers are "not about valuation at this point" considering H-P's bid is already more than double what 3Par's shares were worth before the Dell bid was announced, but rather about solidifying a strategic position in storage space and cloud infrastructure. Shares of Dell closed down 1.1% yesterday; H-P closed down 2%.
• Rio Tinto weighs Potash bid. Rio Tinto (RTP) and an unnamed Chinese partner are considering a joint bid for Potash (POT), according to a report by Canada's Globe & Mail. Vale (VALE), which had previously expressed interest, has cooled on the possibility of presenting a counter-bid to BHP Billiton's (BHP) $38.6B offer. Other potential bidders include Mosaic (MOS), Agrium (AGU), Monsanto (MON), privately-held Cargill Inc. and a handful of Chinese firms including Sinochem and private equity fund Hopu Investment Management. Premarket: RTP -2.6%, POT +0.3%, BHP -1.5% (7:00 ET).
• Disagreement on threshold price stalls Sanofi-Genzyme progress. Sanofi-Aventis (SNY) continues to talk with Genzyme (GENZ) about a possible takeover bid, but sources say significant progress towards a deal has been held up over a disagreement on the threshold price at which Sanofi can begin due diligence on Genzyme. The threshold price has proved to be such an impasse that Sanofi was reportedly considering last week whether to launch a hostile bid, though it ultimately decided to remain in friendly talks for now. Genzyme board members have also been debating whether it's wise to sell the company in the middle of a turnaround, and consider Sanofi's initial offer of $69/share, or $18.4B, to be "lackluster;" the offer would likely have to approach $75/share for Genzyme to open its books, and approach $80 for the deal to get approved. Premarket: SNY -1.7% (7:00 ET).
• AWB backs Agrium bid. As expected, Australia's AWB has thrown its support behind a $1.1B takeover bid from Agrium (AGU) after withdrawing its earlier recommendation for GrainCorp's (GRCLF.PK) bid. As part of the deal, Agrium will allow AWB to pay a dividend of up to $0.20/share, which would be funded by a loan from Agrium. Agrium expects the acquisition to generate annual synergies of $36M and to be accretive to earnings from year one.
• Gov't intensifies Toyota engine probe. The National Highway Traffic Safety Administration has stepped up its investigation of Toyota's (TM) Corolla and Matrix vehicles because of a possible defect that could cause the engines to stall, not start or shift gears harshly. The preliminary evaluation of the cars began on August 18, and they will now be subject to a more serious scrutiny called an engineering analysis. Toyota confirmed the investigation but declined to provide more details. It's unclear whether a recall will be necessary.
• Mortgage industry faces new fees. Government officials are said to be considering new fees on the lending industry in order to pay for federal backing of mortgages. The consensus appears to be that regardless of what happens with Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) the government will have to provide some sort of guarantee to keep the mortgage market functioning properly. In order to justify placing this obligation on the government, policymakers want the cost of any explicit guarantee to be fully offset by the mortgage industry itself.
• Xstrata boosts iron ore exposure. Xstrata (XSRAF.PK) agreed to buy Australia's Sphere Minerals for $381M, gaining access to magnetite iron ore deposits in Mauritania. Xstrata is exploring for iron ore in the Republic of Congo and in December said it would construct an iron ore extraction plant in Australia, but had no producing assets in the iron ore sector. The purchase reflects the coveted status iron ore has achieved as the fast-growing economies of China and India clamor for the key steel making commodity.
• Fed loses appeal on bailout disclosure. The Federal Reserve lost its appeal of a ruling that forced it to name firms that would have failed without a bailout. Unless the court stays its decision, the Fed will have seven days to disclose the documents. The central bank may still appeal to the Supreme Court, and the 20 commercial banks that joined with the Fed in the request already said they plan to appeal.
• Vedanta may face rivals on Cairn bid. Indian state-run energy companies are reportedly considering bidding for a stake in Cairn India (CRNCY.PK) that would edge out Vedanta Resources' (VDNRF.PK) $9.6B offer. India’s oil ministry has told Oil & Natural Gas Corp. to study the possibility of making a counter offer, and GAIL India (GAILF.PK) may join the bid.
• Yen rises to multi-year highs. This morning, the yen reached its highest level against the dollar in fifteen years, and the highest level against the euro in nearly nine years. The currency was already on the rise but accelerated its gains after Japanese finance minister Yoshihiko Noda declined to signal that authorities were preparing to intervene in currency markets. Noda said he was watching the currency markets closely, but had no comment on the possibility that Japan could sell yen in its first direct market intervention since 2004. As of 4:15 ET, the yen was +1.1% against the dollar to 84.20.

Earnings: Tuesday Before Open

• Big Lots (BIG): Q2 EPS of $0.48 beats by $0.01. Revenue of $1.14B (+5.2%) in-line. (PR)
• Trina Solar (TSL): Q2 EPS of $0.52 beats by $0.03. Revenue of $370.8M (+147.2%) vs. $338.7M. Shares +1.9% premarket. (PR)

Today's Markets

• In Asia, Japan -1.3% to 8995. Hong Kong -1.1% to 20659. China +0.4% to 2650. India -0.5% to 18312.
• In Europe, at midday, London -1.1%. Paris -1.3%. Frankfurt -1.0%.
• Futures: Dow -0.7%. S&P -0.75%. Nasdaq -0.7%. Crude -1.2% to $72.24. Gold -0.7% to $1219.50.

Tuesday's Economic Calendar

• 7:45 ICSC Retail Store Sales 8:00 Fed's Evans speaks to Indianapolis Neighborhood Housing Partnership 8:55 Redbook Chain Store Sales 10:00 Existing Home Sales 10:00 Richmond Fed Mfg. 5:00 PM ABC Consumer Confidence Index
• Notable earnings before Tuesday's open: BIG, MDT, TSL

Seeking Alpha's Market Currents team contributed to this post.Complete Story »

The Oxen Group submits: So, it is another awful day in the markets. I am going to turn my attention to a new Long Term Investment… Long Term Investment: Ford Inc. (F) ThesisComplete Story »

Zacks.com submits:
By Dirk van DijkIn June, the nation's Trade Deficit jumped to $49.90 billion from $41.98 billion in May, and from just $27.14 billion a year ago. That is an 18.9% rise for the month and a 83.9% increase from a year ago. It is far worse than the expectations which were for the trade deficit to be more or less unchanged from May.Complete Story »

Gabriel Kaplan submits:North American auto-production output in June was 1.093m units (up 99% YoY). Re-stocking of inventories is still going on in the economy, but we are due for a slowdown unless we see an uptick in employment and consumer confidence. These macro-indicators will probably lead unit sales in the future.In terms of Japanese car companies, we expect a deterioration in earnings for Toyota (TM) given the strength of the yen and the end of government subsidies. Nissan (NSANY.PK) and Honda appear (HMC) to us as the best value in this environment.Complete Story »

Wall Street Strategies submits:Is it a post patriotic reaction to the Fourth of July or is the market so oversold investors are sifting through the ashes to find opportunities? I actually think it's a combination of both. The market is oversold, although it has come down for good reasons. There is the dilemma for investors that are more likely to head for the hills than buy on weakness. There are several facts about the market that make it attractive. I think there is immense value; stocks are extremely oversold, including those affected by the dollar. Investor sentiment is so low it's having a self fulfilling effect, but it's also the kind of pessimism that turns out to be a buying opportunity. Of course the sentiment also leaves the market vulnerable to swift moves lower and that has chased a lot of people out and is keeping a lot of would-be investors at bay.This should be a quiet week with respect to news and volumes and that could help the market reclaim some equilibrium. On that note, the market will still need something akin to good news. Not to be confused with silver linings but actual good news. The best opportunities for that will begin next week with the next round of earnings announcements. Interestingly there is a piece on Bloomberg saying earnings estimates have actually been increasing. I've mentioned several times, however, good earnings aren't always the panacea. There is the matter of $10.3 trillion in earnings not being reflected in the S&P 500 for the period of 1999 to 2009, where stocks finished lower after a decade of trading. It's hard to imagine top line demand being the main driver of bottom line success but if there is any inkling that consumers stepped up then earnings could power stocks much higher. Complete Story »

Markos Kaminis (Wall St. Greek) submits: The latest signs from manufacturing, housing and the labor market all point to the return of economic recession. This report focuses on the dimming of the economy's only shining star, manufacturing. Yesterday offered an ominous ISM Manufacturing Report, and we think you should note the change the report illustrates.The daily barrage of data piles on the double-dip economic recession reality, beating down hopeful strategists and forecasters with truth. It's an ugly truth, unfortunately, but it's what we must deal with. This latest day's dumping included more signs of slowing in manufacturing and housing, and ongoing labor woes. You cannot fool the market with rhetoric for long; she is efficient at processing data, however policy makers, corporate leaders and investment professionals may try to sway her. Eventually, each and every one of them must bow to the truth. We remain an independent voice, seeing both opportunities and warning signs, and offering both long and short ideas without any bias.Complete Story »

Morningstar submits: By David Whiston U.S. auto sales have recently rebounded from lows not seen in decades. Despite the recovery, automakers still have plenty of issues to deal with over the coming years. Below we discuss light-vehicle sales and where we think they are going, challenges from new fuel-efficiency rules and the industry's excess capacity, and then close with our thoughts on some of our OEM names including ones that are getting cheap.Complete Story »

Wall Street Strategies submits:For the first time in 24 years (as long as the data has been compiled) the domestic automakers surpassed their foreign counterparts in customer satisfaction. It was only by a slight margin, but the domestic brands averaged 108 problems per 100 vehicles, compared to an average 109 problems for foreign brands, according to the results of this year's survey. The survey was of 82,000 customers who have purchased a 2010 model year vehicle. For the first time, Ford (F) cracked the top five, jumping from eighth place last year, with 93 problems per 100 vehicles in the first three months of owning or leasing the vehicle. Ford's luxury Lincoln brand had 106 problems per 100 vehicles, making it the highest ranking American luxury brand.Rounding out the top five were Porsche (owned by Volkswagen (VLKAY.PK)) with 83 problems per 100 vehicles (P100), Acura (HMC) (86 P100), Mercedes-Benz (DAI) (87 P100), and Lexus (TM) (88 P100). Porsche took top honors away from Lexus, which was dinged by the recalls during the time period of the survey (February to May). Acura was the biggest mover, gaining 12 spots to the second spot overall from 14th last year. After Ford came Honda, Hyundai Motor Co. (HYMLF.PK), Lincoln, Nissan Motor Co.'s Infiniti (NSANY.PK), and Volvo (VOLVY.PK), all finishing better than the industry average of 109 issues per 100 vehicles.Complete Story »

Investment U submits: By David FesslerI recently plunked down a deposit for a Nissan (NSANY.PK) LEAF – the world’s first all-electric car, which is destined to hit the United States in big numbers. I figure since I work from my home office and don’t drive much, I’ll use the Nissan as my everyday car and leave the gas-guzzler for longer trips.Complete Story »