advanced-micro

Key Insider Pleads Guilty In Massive Insider Trading Case

by nytimes.com on January 20, 2011

In August 2008, Danielle Chiesi, an executive at a New York hedge fund, was swapping confidential information with an associate about a pending reorganization of Advanced Micro Devices, a publicly traded semiconductor company.

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Key Insider Pleads Guilty In Massive Insider Trading Case

Video: Mallaby Says Insider Trading Like `Parking Infraction’

by on December 17, 2010

Dec. 16 (Bloomberg) — Sebastian Mallaby, author of “More Money Than God: Hedge Funds and the Making of a New Elite,” talks about today’s insider trading arrests. Three people who worked at technology firms including chipmaker Advanced Micro Devices Inc. were arrested along with an “expert networker” as federal prosecutors expanded a probe of insider trading to companies. Mallaby talks with Carol Massar and Matt Miller on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

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Video: Mallaby Says Insider Trading Like `Parking Infraction’

Video: Jim Chanos Says `99.9%’ of Wall Street Is `Honest’

December 16, 2010

Dec. 16 (Bloomberg) — Jim Chanos, founder of Kynikos Associates, talks about the arrests of four people and the guilty plea of a fifth person in a federal investigation of insider trading. Three people worked at technology firms including chipmaker Advanced Micro Devices Inc. were arrested along with an “expert networker.” A fifth man, Daniel DeVore, formerly a supply manager at Dell Inc., pleaded guilty in federal court Dec. 10. Chanos speaks with Carol Massar and Matt Miller on Bloomberg Television’s “Street Smart.” (This is an excerpt of the full interview. Source: Bloomberg)

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Video: Berenzweig Expects More Insider-Trading Indictments

December 16, 2010

Dec. 16 (Bloomberg) — Seth Berenzweig, managing partner at Berenzweig Leonard, talks about the U.S. investigation into insider trading and today’s arrests. Three people who worked at technology firms including chipmaker Advanced Micro Devices Inc. were arrested along with an “expert networker” as federal prosecutors expanded a probe of insider trading to companies. He speaks with Carol Massar and Matt Miller on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

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Video: Coffee Says Hedge Funds Are in `Government’s Crosshairs’

December 16, 2010

Dec. 16 (Bloomberg) — John Coffee, a securities law professor at Columbia University, discusses the expansion to companies of the federal investigation into insider trading at hedge funds. Three people who worked at technology firms including chipmaker Advanced Micro Devices Inc. were arrested along with an “expert networker.” A fifth man, Daniel DeVore, formerly a supply manager at Dell Inc., pleaded guilty in federal court in New York on Dec. 10 to conspiracy to commit securities fraud and wire fraud as part of the probe, prosecutors said today in a statement. Coffee speaks with Carol Massar and Matt Miller on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

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Video: Intel’s Perlmutter Discusses Latest Computer Chip Design: Video

September 13, 2010

Sept. 13 (Bloomberg) — Dadi Perlmutter, executive vice president at Intel Corp., talks with Bloomberg’s Cris Valerio about the company’s latest chip design. The world’s largest semiconductor maker will get the chip design into personal computers by early next year in a bid to improve PC graphics and ward off a challenge by Advanced Micro Devices Inc. They speak at the Intel Developer Forum in San Francisco. (Source: Bloomberg)

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DELL SEC Settlement: Computer Maker To Pay $100 Million Over Accounting Fraud Charges

July 22, 2010

WASHINGTON — Computer maker Dell Inc. is paying $100 million to settle civil charges that it used fraudulent accounting to meet Wall Street earnings targets, the government announced Thursday. Under the settlement with the Securities and Exchange Commission, company Chairman and CEO Michael Dell also agreed to pay a separate $4 million civil penalty. While the fine was far from the largest penalty levied by the SEC, the decision to charge a sitting chief executive of a major company and reach a seven-figure settlement with him is rare. Michael Dell is one of the most prominent figures in the technology industry, credited for revolutionizing the PC market by making the computers cheap and accessible. The SEC said the company also failed to disclose to investors large payments it received from Intel Corp. in exchange for not using equipment made by Intel’s main rival, Advanced Micro Devices Inc. Those payments enabled Dell to meet its quarterly earnings targets. After Intel stopped the payments, Dell again misled shareholders by not disclosing the real reason its profits had dropped, the SEC said. Michael Dell and four former executives falsely portrayed the means by which the company met earnings targets from 2002 through 2006, the SEC said in the lawsuit. Without the payments from Intel, the agency said, Dell would have missed analysts’ estimates in every quarter during that time. The company and Michael Dell neither admitted nor denied wrongdoing. But they did agree to refrain from future violations of the securities laws. The company also agreed to improve its disclosure process by hiring an outside consultant and expanding its training of employees. The SEC also named former Dell CEO Kevin Rollins, former Chief Financial Officer James Schneider, former regional Vice President of Finance Nicholas Dunning and former Assistant Controller Leslie Jackson in the suit. Rollins agreed to pay a $4 million civil penalty. Schneider is paying a $3 million penalty as well as $83,096 in restitution and $38,640 in interest. Dunning is paying a $50,000 penalty. The SEC said its investigation of the Dell matter and the possible role of other individuals continues. “Accuracy and completeness are the touchstones of public company disclosure under the federal securities laws,” SEC Enforcement Director Robert Khuzami said in a statement. “Michael Dell and other senior Dell executives fell short of that standard repeatedly over many years, and today they are held accountable.”

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DELL SEC Settlement: Computer Maker To Pay $100 Million Over Accounting Fraud Charges

July 22, 2010

WASHINGTON — Computer maker Dell Inc. is paying $100 million to settle civil charges that it used fraudulent accounting to meet Wall Street earnings targets, the government announced Thursday. Under the settlement with the Securities and Exchange Commission, company Chairman and CEO Michael Dell also agreed to pay a separate $4 million civil penalty. While the fine was far from the largest penalty levied by the SEC, the decision to charge a sitting chief executive of a major company and reach a seven-figure settlement with him is rare. Michael Dell is one of the most prominent figures in the technology industry, credited for revolutionizing the PC market by making the computers cheap and accessible. The SEC said the company also failed to disclose to investors large payments it received from Intel Corp. in exchange for not using equipment made by Intel’s main rival, Advanced Micro Devices Inc. Those payments enabled Dell to meet its quarterly earnings targets. After Intel stopped the payments, Dell again misled shareholders by not disclosing the real reason its profits had dropped, the SEC said. Michael Dell and four former executives falsely portrayed the means by which the company met earnings targets from 2002 through 2006, the SEC said in the lawsuit. Without the payments from Intel, the agency said, Dell would have missed analysts’ estimates in every quarter during that time. The company and Michael Dell neither admitted nor denied wrongdoing. But they did agree to refrain from future violations of the securities laws. The company also agreed to improve its disclosure process by hiring an outside consultant and expanding its training of employees. The SEC also named former Dell CEO Kevin Rollins, former Chief Financial Officer James Schneider, former regional Vice President of Finance Nicholas Dunning and former Assistant Controller Leslie Jackson in the suit. Rollins agreed to pay a $4 million civil penalty. Schneider is paying a $3 million penalty as well as $83,096 in restitution and $38,640 in interest. Dunning is paying a $50,000 penalty. The SEC said its investigation of the Dell matter and the possible role of other individuals continues. “Accuracy and completeness are the touchstones of public company disclosure under the federal securities laws,” SEC Enforcement Director Robert Khuzami said in a statement. “Michael Dell and other senior Dell executives fell short of that standard repeatedly over many years, and today they are held accountable.”

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DELL SEC Settlement: Computer Maker To Pay $100 Million Over Accounting Fraud Charges

July 22, 2010

WASHINGTON — Computer maker Dell Inc. is paying $100 million to settle civil charges that it used fraudulent accounting to meet Wall Street earnings targets, the government announced Thursday. Under the settlement with the Securities and Exchange Commission, company Chairman and CEO Michael Dell also agreed to pay a separate $4 million civil penalty. While the fine was far from the largest penalty levied by the SEC, the decision to charge a sitting chief executive of a major company and reach a seven-figure settlement with him is rare. Michael Dell is one of the most prominent figures in the technology industry, credited for revolutionizing the PC market by making the computers cheap and accessible. The SEC said the company also failed to disclose to investors large payments it received from Intel Corp. in exchange for not using equipment made by Intel’s main rival, Advanced Micro Devices Inc. Those payments enabled Dell to meet its quarterly earnings targets. After Intel stopped the payments, Dell again misled shareholders by not disclosing the real reason its profits had dropped, the SEC said. Michael Dell and four former executives falsely portrayed the means by which the company met earnings targets from 2002 through 2006, the SEC said in the lawsuit. Without the payments from Intel, the agency said, Dell would have missed analysts’ estimates in every quarter during that time. The company and Michael Dell neither admitted nor denied wrongdoing. But they did agree to refrain from future violations of the securities laws. The company also agreed to improve its disclosure process by hiring an outside consultant and expanding its training of employees. The SEC also named former Dell CEO Kevin Rollins, former Chief Financial Officer James Schneider, former regional Vice President of Finance Nicholas Dunning and former Assistant Controller Leslie Jackson in the suit. Rollins agreed to pay a $4 million civil penalty. Schneider is paying a $3 million penalty as well as $83,096 in restitution and $38,640 in interest. Dunning is paying a $50,000 penalty. The SEC said its investigation of the Dell matter and the possible role of other individuals continues. “Accuracy and completeness are the touchstones of public company disclosure under the federal securities laws,” SEC Enforcement Director Robert Khuzami said in a statement. “Michael Dell and other senior Dell executives fell short of that standard repeatedly over many years, and today they are held accountable.”

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DELL SEC Settlement: Computer Maker To Pay $100 Million Over Accounting Fraud Charges

July 22, 2010

WASHINGTON — Computer maker Dell Inc. is paying $100 million to settle civil charges that it used fraudulent accounting to meet Wall Street earnings targets, the government announced Thursday. Under the settlement with the Securities and Exchange Commission, company Chairman and CEO Michael Dell also agreed to pay a separate $4 million civil penalty. While the fine was far from the largest penalty levied by the SEC, the decision to charge a sitting chief executive of a major company and reach a seven-figure settlement with him is rare. Michael Dell is one of the most prominent figures in the technology industry, credited for revolutionizing the PC market by making the computers cheap and accessible. The SEC said the company also failed to disclose to investors large payments it received from Intel Corp. in exchange for not using equipment made by Intel’s main rival, Advanced Micro Devices Inc. Those payments enabled Dell to meet its quarterly earnings targets. After Intel stopped the payments, Dell again misled shareholders by not disclosing the real reason its profits had dropped, the SEC said. Michael Dell and four former executives falsely portrayed the means by which the company met earnings targets from 2002 through 2006, the SEC said in the lawsuit. Without the payments from Intel, the agency said, Dell would have missed analysts’ estimates in every quarter during that time. The company and Michael Dell neither admitted nor denied wrongdoing. But they did agree to refrain from future violations of the securities laws. The company also agreed to improve its disclosure process by hiring an outside consultant and expanding its training of employees. The SEC also named former Dell CEO Kevin Rollins, former Chief Financial Officer James Schneider, former regional Vice President of Finance Nicholas Dunning and former Assistant Controller Leslie Jackson in the suit. Rollins agreed to pay a $4 million civil penalty. Schneider is paying a $3 million penalty as well as $83,096 in restitution and $38,640 in interest. Dunning is paying a $50,000 penalty. The SEC said its investigation of the Dell matter and the possible role of other individuals continues. “Accuracy and completeness are the touchstones of public company disclosure under the federal securities laws,” SEC Enforcement Director Robert Khuzami said in a statement. “Michael Dell and other senior Dell executives fell short of that standard repeatedly over many years, and today they are held accountable.”

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Goldman Sachs Director Gupta Said to Be Suspected of Leaking Buffett Deal

April 23, 2010

By Joshua Gallu and David Scheer April 23 (Bloomberg) — Goldman Sachs Group Inc. director Rajat Gupta is suspected by U.S. investigators of tipping off a hedge fund billionaire to a $5 billion investment in the bank by Warren Buffett ’s Berkshire Hathaway Inc., a person with direct knowledge of the inquiry said. Gupta, 61, who has said he won’t stand for re-election to Goldman Sachs’s board, told Galleon Group founder Raj Rajaratnam about Buffett’s plan before it was announced in September 2008, the person said, declining to be identified because the inquiry isn’t public. Rajaratnam, who was arrested Oct. 16, is fighting criminal charges and U.S. Securities and Exchange Commission civil claims that he used inside information to trade shares of companies including Advanced Micro Devices Inc. In a March 22 letter to Rajaratnam’s lawyers, made public April 9, prosecutors said they had an interest in his trading in Goldman Sachs stock in 2008. Three days before the letter was sent, Goldman Sachs announced Gupta was leaving its board. “Rajat has neither violated any law nor done anything else improper,” his attorney, Gary Naftalis of Kramer, Levin, Naftalis & Frankel LLP, said in a statement. “He has always conducted himself with integrity in his business, philanthropic and personal life.” Goldman Sachs spokesman Samuel Robinson , SEC spokesman John Nester and Janice Oh , a spokeswoman for U.S. Attorney Preet Bharara in New York, declined to comment. Gupta hasn’t been formally accused of any wrongdoing. The Wall Street Journal reported the news earlier today. Goldman Sachs , the most profitable firm in Wall Street history, agreed to sell $5 billion in preferred shares that paid 10 percent interest to Buffett, after the Lehman Brothers Holdings Inc. bankruptcy and Bank of America Corp.’s purchase of Merrill Lynch & Co. Gupta was McKinsey’s worldwide chief from 1994 to 2003, and a senior worldwide partner until 2007. He withdrew from the consulting firm and joined the boards of American Airlines parent AMR Corp., Procter & Gamble Co., Harman International Industries Inc. Genpact Ltd., the business outsourcing company, and Russia’s OAO Sberbank. To contact the reporters on this story: Joshua Gallu in Washington at jgallu@bloomberg.net ; David Scheer in New York at dscheer@bloomberg.net .

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Intel Sales Forecast Tops Estimates as PC Recovery Holds Up; Shares Climb

April 13, 2010

By Ian King April 13 (Bloomberg) — Intel Corp. , the world’s biggest chipmaker, forecast second-quarter sales that topped analysts’ predictions, citing growing worldwide demand for personal computers. Sales will be $10.2 billion, plus or minus $400 million, the company said today in its quarterly earnings statement. Analysts had estimated $9.72 billion on average, according to a Bloomberg survey. Profitability also remains buoyant, prompting Intel to increase its full-year gross margin forecast to about 64 percent from roughly 61 percent. The forecast follows record first- quarter sales, fueled by consumers ordering laptops. Analysts expect demand to increase further in the second half as more businesses upgrade their computer networks. “They’re very strong numbers,” said Cody Acree , an analyst at Williams Financial Group in Dallas. “It’s well above what anyone was expecting.” Intel rose 88 cents, or 3.9 percent, to $23.65 in late trading following the announcement. The shares, which gained 12 percent this year, closed at $22.77 on the Nasdaq Stock Market. Last Quarter First-quarter net income climbed to $2.44 billion, or 43 cents a share, from $629 million, or 11 cents, a year earlier. Analysts projected 38 cents a share. Revenue increased 44 percent to $10.3 billion, compared with the average estimate of $9.85 billion. In January, the Santa Clara, California-based company forecast sales of $9.7 billion, plus or minus $400 million. It predicted gross margin , or the percentage of sales remaining after deducting the cost of production, of about 61 percent. It came in at 63 percent. Intel leads off two weeks of earnings reports by the largest U.S. technology companies, including International Business Machines Corp., Google Inc. and Microsoft Corp. Intel supplies more than 80 percent of the world’s PC processors, making its sales a barometer of computer industry demand. Notebook shipments jumped 37 percent in the first quarter from a year earlier and account for 61 percent of the market, according to El Segundo, California-based ISuppli Corp. Intel is profiting from the relative weakness of its main rival, Advanced Micro Devices Inc., according to Tristan Gerra , an analyst at Robert W. Baird & Co. in Milwaukee. Intel also has a new chip lineup, which it released in the first quarter. “Intel is in front of the best product cycle in years,” said Gerra, who has an “outperform” rating on the stock and doesn’t own it. “On top of that, we believe that Intel is gaining market share.” To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net

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Richard Lisa Appointed President of Cinnabar Ventures, Inc.

January 19, 2010

FORT MYERS, FL–(Marketwire – January 19, 2010) – Cinnabar Ventures, Inc. (“Cinnabar”) ( OTCBB : CNBR ), the creator of the Yippy OS; www.yippy.com , a cloud-based operating system currently in beta, announces the appointment of Richard “Rick” Lisa, age 51, as President, Chief Operating Officer and Director. Prior to this appointment, Mr. Lisa was Vice President of Field Sales and Director of World Wide Embedded Sales for Advanced Micro Devices, Inc. (“AMD”).

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Griffin’s Citadel Said to Debut High-Yield Loan Deal With Targa Resources

December 7, 2009

By Pierre Paulden and Richard Bravo Dec. 7 (Bloomberg) — Citadel Securities is arranging its first loan for a corporate borrower as the investment banking division of Citadel Investment Group LLC builds a credit business, according to people familiar with the situation. Targa Resources Inc., a Houston-based gas-pipeline company, selected Citadel, alongside Deutsche Bank AG and Credit Suisse Group AG, to arrange credit facilities of as much as $700 million, according to the people, who declined to be identified as the loan hasn’t closed. Ken Griffin , who founded Chicago-based Citadel in 1990 at the age of 23, started an investment-banking firm last year to diversify from its $13 billion hedge-fund business. Leveraged- loan sales have risen as the market has rebounded 47.1 percent from a record 28.1 percent decline in 2008 amid the failure of Lehman Brothers Holdings Inc. and a seizure in credit markets. Devon Spurgeon, a spokeswoman for Citadel declined to comment. Matt Meloy , a vice president for finance and treasurer for Targa, didn’t return a call. Banks have arranged $41 billion of leveraged loans since September, more than in each of the previous three quarters, Bloomberg data show. High-yield, high-risk debt is rated below Baa3 by Moody’s Investors Service and BBB- by Standard & Poor’s. Loans are repaid first in bankruptcy, before bonds and equities. Revolving Loan Citadel hired Mike Weir , a loan trader at Morgan Stanley, in October for its credit business. That month, Patrik Edsparr was named to run the securities firm. In November, Citadel underwrote its first benchmark bond offering, a $500 million issue for Advanced Micro Devices Inc. The Targa bank debt will include a $150 million revolving loan due 2014 and a term loan due 2016, the company said in a Dec. 4 statement. The term loan could be as large as $550 million, with proceeds used in part to refinance Targa’s 8.5 percent senior unsecured notes due in 2013, according to the statement. The remaining proceeds will also be used to repay the existing balance on its senior secured term loan due 2012 and to purchase a portion of parent company Targa Resources Investments Inc.’s loan facility due 2015, the statement said. The company is rated Ba3, the third-highest speculative grade, by Moody’s. To contact the reporters on this story: Pierre Paulden in New York at ppaulden@bloomberg.net ; Richard Bravo in New York at rbravo5@bloomberg.net

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Citadel Debuts Benchmark Debt Underwriting With Advanced Micro Offering

November 18, 2009

By Pierre Paulden and Gabrielle Coppola Nov. 18 (Bloomberg) — Citadel Securities , the investment banking division of Citadel Investment Group LLC, is underwriting its first benchmark debt offering as it seeks to diversify from its $14 billion hedge-fund firm. Advanced Micro Devices Inc. selected JPMorgan Chase & Co. and Citadel to sell $500 million of senior notes to buy back outstanding convertible debt, according to a person familiar with the offer who declined to be identified because terms aren’t set. Ken Griffin , who founded Citadel in 1990 at the age of 23, started an investment-banking firm last year to compete with banks such as Goldman Sachs Group Inc. and Morgan Stanley. Patrik Edsparr was named last month to run the business, which advises clients including Cumulus Media Inc. an Atlanta-based broadcaster, and casino operator Fontainebleau Las Vegas Holdings LLC, which filed for bankruptcy in June. Devon Spurgeon, a spokeswoman for Chicago-based Citadel, declined to comment. The world’s second-largest maker of personal-computer processors will use proceeds from the offering and existing cash to purchase as much as $1 billion of its 5.75 percent convertible senior notes, Sunnyvale, California-based Advanced Micro said today in a statement distributed by Business Wire. Brenda Rarick, a spokeswoman for the chipmaker, declined to comment. The convertible buyback may make the chipmaker more attractive to investors concerned Advanced Micro would lack the cash to repay looming debt maturities, said Joanne Feeney , a New York-based analyst for FTN Midwest Securities Corp. The eight-year debt, which can’t be called for the first four years, may be sold as soon as Nov. 23, according to the person familiar with the offering. The notes may be rated B2 by Moody’s Investors Service and B- by Standard & Poor’s, the person said. To contact the reporters on this story: Pierre Paulden in New York at ppaulden@bloomberg.net ; Gabrielle Coppola in New York at gcoppola@bloomberg.net

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Norb Vonnegut: CEO Overboard

October 28, 2009

The bad news keeps coming at Galleon. The AMD executive who tipped inside information, according to The Wall Street Journal, was none other than the former CEO. A criminal case filed by the Manhattan U.S. Attorney’s office earlier this month alleged that an unnamed Advanced Micro Devices Inc. executive shared confidential information about the chip maker with a defendant in the case. The AMD executive is Hector Ruiz, then AMD’s chairman and previously chief executive, according to a person familiar with the matter. Why would a CEO tip inside information? Go figure. If the allegations are true, we can rule out money as the primary motivation. Forbes reported that Ruiz made $9.02 million in 2006 as the CEO of AMD. The magazine valued his company stock at $8.8 million. The car payments look safe. We can also rule out any sense of “being invulnerable” or “above the law.” The Wall Street Journa l accounts reek of fear between the lines. There’s a sense of vulnerability in the discourse. On July 24, 2008, Chiesi called Rajaratnam and told him she was talking to an unidentified Akamai executive “about the family” and how “you’re the only person in the family that helps me,” the charges allege. Nobody’s too big to jail. I don’t know any of the players personally, the Galleon employees or the the former CEO of AMD. But if the allegations are true, my guess is they succumbed to a dangerous mindset: win every time at any cost. Presumably, there was a glory to betting big and being right–a mindset I explore in Top Producer. The highs from winning more than trumped considerations of fair play. Of course, there was one problem. They got caught. Now, it’s game over. Wiretaps, once the bane of drug lords and Mafiosi, are working their way through Hedgistan, according to Bloomberg news. The Galleon recordings will play out in a packed court room. The tapes will remind anybody trading on inside information of the game-ending consequences. Go directly to jail. Do not pass Go. Do not collect $200 (million).

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Video: Market Close 10.16

October 16, 2009

All Three Major Indexes Each Fall Less Than 1%; Bank of America Shares Fall 4.6% After Earnings Miss Estimates; Advanced Micro and IBM Both Give Cautious Outlooks in Earnings Reports, Shares Fall in Reaction; Estee Lauder Shares Rise 5%, Positive Outlook for Holiday Sales; Haliburton Reports Positive 3Q Earnings; 65% of Technology Companies and 71% of Financial Companies Beating Top Line of Analysts’ 3Q Estimates (Bloomberg News)

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Stocks in U.S., Europe Gain on Philips Profit; Yen Drops, Crude Oil Rises

October 12, 2009

By Sapna Maheshwari Oct. 12 (Bloomberg) — U.S. and European stocks rose, sending the MSCI World Index to near a one-year high, on speculation improving corporate earnings will extend a seven- month rally in equities. Oil and metal prices advanced. General Electric Co., which will report third-quarter results on Oct. 16, climbed 1.5 percent after Royal Philips Electronics NV unexpectedly posted a profit. Freeport-McMoRan Copper & Gold Inc. added 1.5 percent as copper increased. Advanced Micro Devices Inc. rallied 4.1 percent after UBS AG recommended the shares. The Standard & Poor’s 500 Index rose for a sixth straight day, its longest streak since June 2007. “The market will continue with a positive bias,” said Stanley Nabi , New York-based vice chairman of Silvercrest Asset Management Group, which oversees $8 billion. “The profit reports that will begin to come out this week should be very solid and the economic data that’s coming out is quite encouraging.” The S&P 500 advanced 0.3 percent to 1,075.06 at 9:34 a.m. in New York, above its highest close since Oct. 3, 2008. The Dow Jones Industrial Average rose 32.72 points, or 0.3 percent, to 9,897.66. The MSCI World Index of 23 developed nations climbed 0.6 percent to above its highest close since Oct. 1, 2008. The S&P 500 last week jumped 4.5 percent, its best advance since July, as Alcoa Inc. started the third-quarter earnings season with an unexpected profit and economic data signaled the U.S. recession is ending. ‘Recovery Is Under Way’ “Last week’s earnings showed that analyst expectations can be surpassed and that not everything is priced in yet,” said Gregor Mast , an equity strategist at Clariden Leu AG in Zurich, which oversees about $88 billion. “We believe that the recession is over and the recovery is under way. Equities are fairly valued but require that we see the profit side move up.” Companies from Intel Corp. to Goldman Sachs Group Inc. are scheduled to report earnings this week. Companies on the S&P 500, which has rebounded 59 percent from a 12-year low in March, will report a ninth straight quarter of declining profits, the longest streak since the Great Depression, before returning to growth in the final three months of the year, analysts’ estimates compiled by Bloomberg show. GE gained 1.5 percent to $16.42. Philips, Europe’s biggest consumer-electronics maker, said operating earnings at its consumer unit more than doubled as it reported third-quarter net income of 174 million euros ($256 million). Analysts had predicted a loss of 44.7 million euros, the average of 13 estimates compiled by Bloomberg. Philips helped lead the gains in Europe’s Stoxx 600 , adding 6.4 percent in Amsterdam, while energy companies rose with oil. Total SA , Europe’s biggest refiner, rose 1.6 percent in Paris. Commodity Producers Freeport rose 1.5 percent to $75.46. Copper climbed on speculation demand for raw materials is increasing as the global economy recovers from its worst recession since World War II. Alcoa , the largest U.S. aluminum company, gained 0.8 percent to $14.35. Chevron Corp., the second-largest U.S. oil company, increased 0.7 percent to $73.23 as crude rose above $73 a barrel for the first time in three weeks. Advanced Micro Devices added 4.1 percent to $6.12. The second-largest maker of personal-computer processors was raised to “buy” from “neutral” at UBS. Plum Creek Timber Co. climbed 1.9 percent to $32.45. The forest-products company was raised to “neutral” from “underweight” at JPMorgan Chase & Co. U.S. Discount The S&P 500 is valued at the biggest discount to the MSCI World Index of 23 developed countries since May 2003, according to monthly data compiled by Bloomberg. There is still room for stocks to rise, according to Barclays Capital Inc.’s Larry Kantor , while David Rosenberg says investors should buy bonds or seek dividends because this isn’t a normal recovery. Kantor, head of research at Barclays Capital in New York, was one of the first economists to call the end of the recession, in March. Barclays sees GDP expanding at a 4 percent rate now, 5 percent in the first quarter and 3.6 percent for 2010. Rosenberg, the chief economist and strategist for Toronto- based Gluskin Sheff + Associates Inc., was among the first to warn of impending recession in 2006. Federal Reserve Bank of St. Louis President James Bullard said in a speech yesterday that U.S. jobs growth will return this year or next. To contact the reporter on this story: Sapna Maheshwari in New York at smaheshwar11@bloomberg.net

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