NEW YORK – Looking for UGG boots? Or what about the last string of holiday lights or inflatable Santas to spruce up the lawn? You might be out of luck.

Some last-minute holiday shoppers are facing disappointment. Stores are running out of key holiday items — and not just Zhu Zhu pets, those robotic hamsters that have been hard to find since before Thanksgiving.

Even sparkly tops, skirts and scarves are running scarce at some stores. Bloomingdale's spokeswoman Anne Keating said that the upscale department store chain has sold out practically of "anything that sparkles" over the past week.

Of course, even ambitious shoppers who got a head-start faced some hurdles beyond the toy aisles. At Mall of America, the nation's biggest shopping center, an $85 wallet by popular designer Tory Burch in an array of colors — blue, gold and black — was sold out prior to Thanksgiving, before the mall had a chance to pull it from its holiday advertisments, according to Mall of America spokeswoman Bridget Jewell.

It's a switch from last year, when piles of holiday treasures were discounted up to 90 percent as a freefall in spending left merchants swimming in inventory.

But this year, stores cut inventories, willing to take a risk of running out of items rather than having to slash prices. The strategy is expected to boost fourth-quarter profits but may limit sales in the final days and even after Christmas.

Of course, shoppers who have a generic holiday list — a black sweater or a flat-panel TV in any brand — will find plenty to choose from. But slim pickings on key items are frustrating some shoppers, who appear to be delaying purchases more this year than last year.

"Stores need to have a good selection" for last-minute buyers, Laura Gurski, partner in the retail practice of A.T. Kearney, a global management consultant. She also wonders how stores will excite shoppers to come back after Christmas if leftovers are skimpy.

A look at what's hard to find:

CLOTHING AND ACCESSORIES: At Bloomingdales, Burberry down coats, Hunter's original Gloss Wellington rain boots, along with the socks that are sold separately, are sold out or almost sold out, Keating said payday loan companies.

She noted that the chain is getting regular shipments of UGG boots but they are selling out. Also scarce are denim leggins by Daddy Long Legs, she said.

Nordstrom's spokeswoman Brooke White reports limited quantities of the Wellington boots in pea green, violet or graphite, while the store has sold out of Bosca's magnetic money clips in dark brown leather and The North Face's women's fleece in colors like pink, black and white.

The upscale store has also sold out of charm necklaces with such messages as "Truth" and "Peace."

HOME DECOR: Most holiday decorations are gone at home-improvement chains Home Depot and Lowe's. Both say energy-efficient LED holiday lights have been gone for days.

Most inflatable lawn ornaments have sold out. Another key item that shoppers can't find is Home Depot's lighted reindeer and sleigh lawn decor.

Lowe's said the most popular inflatables were the least expensive — a 4-foot Santa and a 4-foot snowman, retailing each for $19.97, have sold out.

TOYS: Those who haven't gotten their hands on Zhu Zhu pets yet may have to wait until after Christmas.

Toys R Us spokeswoman Kathleen Waugh said that the toy retailer sold 1 million of them in the past week and is receiving a couple of hundred thousand more before Christmas. Wal-Mart Stores Inc. is getting about 20 to 60 per store per day through Wednesday, but the rodents sell out immediately.

Many of the hot toys are scarce, including Mattel Inc.'s Rocky the Robot and Mindflex which measures brain waves and uses them to push a ball through a course and Hasbro Inc.'s Chuck My Talking Truck.

Jim Silver, an analyst at Timetoplaymag.com, said there are more toy shortages this year than last year.

___

AP Retail Writer Mae Anderson contributed to this report.

Holiday stragglers find shortages of hot items

LONDON (MarketWatch) -- Mining firms weighed on the broader London market on Thursday, as the sector pulled back from early gains to trade lower.

Miners under pressure in midday action in London included Anglo American , down 1.2%, Rio Tinto , down 1.6%, and Xstrata , down 3.2%.

Anglo-Swiss mining giant Xstrata said Thursday that it will increase capital expenditure to $6.8 billion, up from previous guidance of $3.6 billion.

Xstrata said that it has a substantial pipeline of more that $40 billion of organic growth projects. That includes over $8 billion of projects currently in construction and a further $8 billion due for approval within the next twelve months.

It also said that it expects to continue with its growth strategy, in part through making major acquisitions.

Xstrata has made a string of acquisitions since 2001 and most recently tried to buy Anglo American but was rebuffed.

The earlier gains in the sector followed another record for gold futures as the decline in the value of the U.S. dollar continued to attract investors into the precious-metals market. Read more on gold.

Global Dow

Overall, the U.K. FTSE 100 index declined 0.1% to 5,324.03.

Other European shares were mildly higher and U.S. stock futures were pointing to gains on Wall Street.

Late Wednesday, Bank of America Corp. said that it will repay $45 billion it got from the government after raising $18.8 billion selling new common securities, setting the giant lender on course to wean itself from taxpayer support.

Amid that sign that banking-sector health is improving, European lenders advanced, with Barclays shares up 3.6%, Lloyds Banking Group shares up 3.8% and Royal Bank of Scotland shares up 2.6%.

Elsewhere, airline British Airways shares rose 3%. The airline reports traffic figures later Thursday.

London Markets: Mining-sector decline weighs on British shares

On-the-job training has its roots in the Middle Ages. Apprenticeship, it was called then, and it generally was for the young.

The new variation, now called an internship, is not the painstaking, multiyear experience it once was, but it still offers the same advantages: a chance for a worker to gain knowledge at little or no cost to the employer.

In boom times, companies with too much work for existing employees &<51; yet not enough work to justify another hire &<51; may have turned to temporary workers. But with the economy still in the doldrums, companies again are opting for unpaid or low-paid internships to get the extra work done.

It is a brilliant, recession-proof way to double your work force, said Drew McLellan, whose McLellan Marketing Group in Des Moines has long hired unpaid interns. &S220;It&S217;s more money to the bottom line for you.&S221;

While there are no definitive numbers on how many internships exist or how many companies offer them, most are probably at smaller companies and nonprofit groups rather than large public companies, according to Internships.com, a placement service with some 13,000 listings. C. Mason Gates, the president and founder of Internships.com, said that with economic uncertainty, smaller businesses would continue to view interns as a source of growth, talent development and project-based work.

Internships have never been out of vogue, but the competition for positions is heating up, which is good news if you run a company needing economical, entry-level workers.

&S220;The importance of an internship has changed from what parents experienced,&S221; said Steve Rodems, senior partner at Fast Track Internships, which charges $799 to help an intern find an unpaid job. &S220;It&S217;s no longer a nice-to-have addition to you r&>33;sum&>33;. Upon graduation, more and more companies are looking for graduates who also have some real-world internship experience.&S221;

One employer who recently hired an intern was Suzan French, who, after four years as an independent public relations consultant in Allentown, Pa., needed help but was not prepared to bring on a full-time employee. In May, she hired Kate Mackes, 21, a finance major at nearby Lehigh University. Ms. Mackes runs clients&S217; social media projects while Ms. French offers old-school instruction in the public relations business.

&S220;Kate was raised on it and is active in it, and that is something I&S217;m still learning,&S221; Ms. French said. &S220;She is able to come in and use social media for the betterment of a client, and I&S217;ve been able to teach her some of the more traditional P.R. and marketing practices that you don&S217;t learn in the classroom.&S221;

Internships run the gamut from marketing and finance to geology, fashion, architecture and entertainment. While some are part of university programs and carry academic credit, others are less formal with nothing changing hands except an occasional lunch.

And internships are no longer just the province of college students. More unemployed professionals are seeking them &<51; whether to test-drive a new career or simply to keep themselves occupied, according to internship placement services. Mr. Rodems, of Fast Track Internships, said 10 percent of his clients were college graduates changing professions, compared with just 1 percent in 2008. And, he said, internships are increasingly running throughout the year, not just in the summer.

Michael Sabatino, 38, an equity analyst at Smith Barney in New York until he was laid off in 2008, is one of those professionals who sought an internship.

He said that, after caring for his newborn daughter for a year, he approached a small fee-only wealth management firm in New Jersey for a full-time position. None were open, so Mr auto loan. Sabatino offered his services free to learn the business.

He ended up earning $10 an hour &<51; far less than his family&S217;s living expenses &<51; and had no job offer at the end of his five-month stint. But he described the position as a turning point, in part, because it exposed him to the daily challenges of running a small business and demonstrated to potential employers his passion for serving clients and developing his technical expertise.

&S220;The internship was a key transitional experience in my career that positioned me for a long-term opportunity in a wealth management organization,&S221; Mr. Sabatino said. He is interviewing with boutique wealth managers.

Connie Rivera, 57, also used an internship to change careers after she left her job as chief executive of the American Dietetic Association in Chicago in 2000 to pursue her passion for gardening.

She got a job at a local garden center to learn the business. For 18 months she did grunt work &<51; answering customer telephone calls, watering plants, helping with payroll, she said. In 2003, she opened her own garden and landscape business. She now has 42 employees &<51; and one intern &<51; and says she expects to have $4 million in revenue by Dec. 31.

&S220;I took a $250,000 pay cut, but it was the kind of research I needed to do to write my business plan,&S221; Ms. Rivera said.

While menial tasks often go with the territory, the best internships interpose photocopying with client meetings, true-life assignments and mentoring.

&S220;A company gets as much from an intern as the intern gets from the company &<51; if it&S217;s a good internship,&S221; said Lalia Rach, dean of the Tisch Center for Hospitality, Tourism and Sports Management at New York University.

For employers, setting up an internship program is relatively easy and inexpensive. Veterans of the hiring process say business owners interested in offering internships should develop relationships with local college professors who can choose good intern candidates and seek legal advice to ensure that federal and state labor laws are followed. Business owners should have a clear idea of what they want from an intern and then interview candidates in the same way they do potential regular employees.

Mr. McLellan, from the Des Moines marketing company, said several of his interns had been hired at or opened marketing shops.

&S220;The reward as a business owner is knowing you gave them a little boost,&S221; he said. &S220;And it&S217;s fun to watch them take it wherever they are going to take it.&S221;

While most interns receive no money &<51; and others slightly more than the $7.25 hourly minimum wage &<51; interns are not exactly free. At least initially, it is more efficient for managers to do something themselves than to train someone. Also, while most interns are go-getters, exams and socializing can interfere.

Consuelo C. Bova, chief executive of ForTheFit.com, an online clothing retailer, brought on her first unpaid intern last February to do marketing and public relations. Ms. Bova said she was so impressed with the intern, a University of Central Florida junior, that she hired her as a part-time assistant after the internship ended in April. In August, Ms. Bova interviewed candidates to fill another intern opening &<51; this time a paid position.

&S220;Those I have interviewed to date have been, at worst, merely qualified and capable of doing the job, and at best, exciting, enthusiastic, experienced and capable of delivering high-quality work for our company,&S221; Ms. Bova said.

Hiring Is Rising in One Area: Low-Paid Interns

SAN FRANCISCO/LOS ANGELES (Reuters) – Wal-Mart Stores Inc (WMT.N) is helping "well over 1,000" of its apparel suppliers secure financing based on the strength of its own credit rating.

The program, outlined in a November 2 letter to suppliers, was designed to address concerns about liquidity, company spokesman John Simley said.

"We didn&&9;t want our suppliers to be in a position where they could not secure financing at an attractive rate," he said.

Under its "Supplier Alliance Program," an eligible supplier can go to a bank with a purchase order from Wal-Mart and the bank can arrange for financing based on Wal-Mart&&9;s strong financial position.

The retailer, which has a AA credit rating, said it has partnered with Wells Fargo & Co (WFC.N) and Citibank Inc (C.N) to provide the program.

"We&&9;re not underwriting and we&&9;re not extending our (credit) rating," he said.

Factors buy receivables -- or the right to receive money owed by retailers -- from suppliers at a discount so that those suppliers continue to have working capital.

But worries about the health of factors has heightened following the November 1 bankruptcy of CIT Group Inc (CITGQ easy payday loans.PK), a major player in the factoring industry.

"We know that many of our suppliers are dependent upon factoring and financing companies that are reportedly in financial distress," Wal-Mart wrote in its letter to supplies.

"We are contacting you as part of our effort to proactively minimize the exposure of our supplier base to the financial difficulties of any particular factoring source."

Wal-Mart&&9;s ultimate goal with the program though is to keep its own costs down.

"It gives us a more secure supply of the things we need to sell and, if the suppliers are getting a little bit better rate because their loan was negotiated on the strength of our financial position, we can lower our costs and that can be passed on in the form of lower prices," Simley added.

(Reporting by Nicole Maestri and Lisa Baertlein; editing by Leslie Gevirtz and Andre Grenon)

Wal-Mart helps apparel suppliers secure financing

WASHINGTON (AP) &<51; A politically connected financial firm and two of its executives were indicted Thursday for what prosecutors say was a bid-rigging scheme in the municipal bond business.

The charges in the nine-count indictment filed Thursday in Manhattan federal court against CDR Financial Products are the first resulting from the Justice Department&S217;s inquiry of the municipal bonds industry. CDR, based in Beverly Hills, Calif., has also come under scrutiny for its ties to Gov. Bill Richardson of New Mexico.

The indictment accuses two CDR executives and one former executive from the firm of engaging in bid-rigging conspiracies in which CDR was hired by public entities that issue municipal bonds to act as their broker and conduct a supposedly competitive bidding process.

&S220;This case is fundamentally about collusion, the illegal rigging of a purportedly competitive bidding process,&S221; said Joseph Demarest, head of the FBI&S217;s New York office.

The result of the scam, Mr. Demarest said, was less money for the states, cities and counties that hired CDR.

CDR is also known as Rubin/Chambers, Dunhill Insurance Services Inc.

Prosecutors said that CDR&S217;s company&S217;s owner and president, David Rubin, vice president Evan Zarefksy and former chief financial officer Zevi Wolmark took part in two wire fraud schemes. The three are also charged with obstructing the Internal Revenue Service faxless pay day loans.

Because such bonds are tax-exempt, the competitive bidding process is regulated by the I.R.S.

Prosecutors said the company secretly manipulated the bidding process to enrich themselves and the bidding companies at the expense of the municipalities, the I.R.S. or both.

Under the scheme, CDR would arrange in advance which company would win a particular bid for bond business and arrange kickbacks to CDR in the form of inflated fees, authorities said.

In one 2006 state bond deal, one of the bidders agreed to pay CDR a $475,000 kickback, according to the indictment.

The municipal bond business is huge: In 2007 and 2008, about $800 billion worth of municipal bonds were issued across the country.

If convicted of the most serious charge against them, the three men face a maximum prison sentence of 20 years.

Mr. Rubin&S217;s lawyer Donald Etra said the government had &S220;no basis&S221; for the charges.

&S220;The bottom line is that David Rubin has done nothing wrong,&S221; Mr. Etra said. &S220;He&S217;s a brilliant businessman and a prominent philanthropist.&S221;

Lawyers for the other two men could not immediately be located.

3 Accused of Bid-Rigging in Municipal Bonds Sales

TOKYO (Reuters) – The Japanese government has decided to put a state-backed turnaround body in charge of the revitalisation of Japan Airlines (9205.T), the Nikkei business daily said on Sunday, underlining the government&&9;s deeper involvement in the process.

Liabilities at JAL would exceed its assets by as much as &&6;8.8 billion if Asia&&9;s largest airline by revenues were liquidated, a source with direct knowledge of the matter said on Friday, underscoring the depth of the problems facing the airline as it seeks aid from banks and the state to avoid bankruptcy.

The state body, the Enterprise Turnaround Initiative Corporation of Japan (ETIC), invests in and buys debt of companies with strained balance sheets and dispatches turnaround specialists to assist them in restructuring.

JAL is now set to slash its debt under the government&&9;s guidance and come up with a drastic restructuring scheme, the Nikkei said. The decision to put JAL under ETIC&&9;s supervision will be announced as early as this week, the paper said.

The ETIC, established earlier this month, will operate like an investment fund and will initially have the ability to procure up to 1 auto loans for people with bad credit.6 trillion yen (&&6;17 billion) in state-guaranteed funding in the current fiscal year to March 2010.

No officials at the ETIC were immediately available for comment.

A task force led by turnaround specialists, which reports to Transport Minister Seiji Maehara, has been seeking a bridge loan of about 180 billion yen and a total capital boost of 300 billion yen from both the government and the private sector, the source said.

The government, working with the ETIC, will look into a new and more in-depth turnaround scheme for the airline, while paying heed to the task force&&9;s existing plans, the Nikkei said.

JAL is headed for its fourth annual loss in five years, weighed down by roughly &&6;15 billion in debt and a bloated cost base that makes it less efficient than domestic rival All Nippon Airways Co (9202.T).

(&&6;1 = 92.04 Yen)

(Reporting by Kiyoshi Takenaka; Editing by Sugita Katyal)

Govt-backed body to oversee JAL turnaround: Nikkei

NEW YORK (Reuters) – Stocks rose on Friday as investors snapped up technology shares following upbeat broker comments on such bellwethers as Apple, offsetting a drag from natural resource shares after the dollar&&9;s rebound.

Apple Inc (AAPL.O), the iPhone and the iPod maker, jumped 0.5 percent to &&6;190.20 after it was added to UBS&&9; list of strategic stock picks.

Shares of BlackBerry devices maker Research In Motion Ltd (RIM.TO)(RIMM.O) gained 2 percent to &&6;70.08 after a Baird analyst upgraded the stock to "outperform" from "neutral," saying upcoming device launches could be a positive catalyst and the current stock price was attractive.

"Technology is one of the sectors that&&9;s still growing, and I think that&&9;s why you&&9;re seeing the strength. The valuations are still not extreme for their growth," said Alan Lancz, president of Alan B. Lancz & Associates Inc, an investment advisory firm, based in Toledo, Ohio.

"The tech balance sheets are strong, and the companies have some interesting products as far as the smartphones, and that&&9;s just incredible as far as the overseas potential."

The Dow Jones industrial average ( free credit scores.DJI) jumped 26.15 points, or 0.27 percent, to 9,813.02. The Standard & Poor&&9;s 500 Index (.SPX) rose 2.15 points, or 0.20 percent, to 1,067.63. The Nasdaq Composite Index (.IXIC) gained 8.82 points, or 0.42 percent, to 2,132.75.

The semiconductor index (.SOXX) was up 1.6 percent.

International Business Machines Corp (IBM.N) advanced 1.8 percent to &&6;124.48 and was the top boost to the Dow.

The dollar rose broadly, putting a lid on global commodity prices after Federal Reserve Chairman Ben Bernanke said that monetary policy might have to be tightened as a recovery takes hold.

The dollar&&9;s decline, which culminated in a 14-month trough against a basket of currencies on Thursday, has been one the major underpinnings of the stock market&&9;s run-up as the appetite for riskier assets grew.

The benchmark S&P 500 (.SPX) has rallied nearly 60 percent from a 12-year low of early March, and was on track to reverse a two-week losing streak.

(Reporting by Ellis Mnyandu; editing by Jeffrey Benkoe)

Wall Street rises as Apple, other techs advance

BRUSSELS &S212; The economy of the euro zone shrank more than expected in the second quarter of this year because private demand and trade were lower than previously estimated, data released Wednesday showed. But analysts said it was still likely that the region was already returning to growth.

The European Union statistics office Eurostat reported that gross domestic product in the 16-country euro area contracted 0.2 percent in the April-to-June period, compared with the previous quarter, and by 4.8 percent in annual terms.

This compared with the previously reported drops of 0.1 percent and 4.7 percent. Economists polled by Reuters had expected Eurostat to confirm its previous estimates.

But Howard Archer, an economist at Global Insight, said that what he termed the &S220;modest downward revision&S221; in figures for the second quarter &S220;does not materially change the picture.&S221;

&S220;It still indicates that the euro zone economy was close to stabilizing in the second quarter after a year of deep overall contraction, and it still seems likely that the region returned to growth in the third quarter, albeit modest,&S221; he said.

He forecast 0.3 percent growth in the just-concluded third quarter, compared with the second.

A plunge in inventories was slightly smaller than previously reported immediate payday loans online. The drop in stocks of finished goods took away 0.6 percentage point from the overall result in the second quarter, rather than the 0.7 percentage point reported previously.

Also the contribution from government spending was higher than previously reported, at 0.2 percentage point, rather than just 0.1 percentage point, showing the positive effects of stimulus packages that have injected money into economies.

But this was more than offset by a downward revision of the positive contributions made by household demand and trade. Consumer demand was zero rather than a positive 0.1 percentage point and trade added 0.5 percentage point, rather than 0.7 points as estimated earlier.

Eurostat data also showed the recession turned out to be deeper than previously estimated in the Netherlands and Austria.

The data is likely to add to European Central Bank caution not to withdraw its monetary stimulus prematurely when the E.C.B. meets to decide interest rates on Thursday.

Economists say they believe the E.C.B. will keep rates at a record low 1 percent until the third quarter of 2010.

Reuters

Euro-Zone G.D.P. Shrank More Than Expected in Quarter

LONDON (Reuters) – European shares look set to finish the third quarter with their best performance in nearly a decade on expectations of economic recovery while world stocks also rose strongly though not as much as in the previous period. The pan-European FTSEurofirst 300 (.FTEU3) index put on 0.4 percent on Wednesday and the MSCI world index added the same, while commodity prices were also firmer but the dollar fell against a basket of currencies.

"We&&9;re ticking higher on the last day of a strong quarter but investors remain a touch cautious ahead of the start of October, always a volatile month, and Friday&&9;s U.S. jobs report," said Mic Mills, senior trader at ETX Capital in London.

Equities have been rallying hard since early March as investors have become more confident about the prospects for economic recovery.

The European benchmark index is up more than 18 percent in July-September, on course to record its biggest quarterly rise since December 1999. It rose nearly 16 percent in the previous quarter but is still 38.5 percent below its peak in mid-2007.

Global stocks gained 17.6 percent this quarter after rising more than 21 percent in April-June, its best ever quarterly rise, while Britain&&9;s FTSE 100 (.FTSE) was set to register its best quarterly gains since the index was launched in 1984.

The corporate outlook has also showed some signs of revival, with the world economy recovering from its worst recession since the 1930s Great Depression.

British retailer Marks & Spencer (MKS.L) on Wednesday posted an improvement in its quarterly sales trend and raised its forecast for full-year profit margin, but cautioned 2010 was likely to be a tough year.

"GDP and earnings are still being upgraded, valuations are not horribly expensive and cash is still zero percent, we are in a sweet spot," said Khiem Do, head of Asia multi-asset group at Baring Asset Management guaranteed approval cash loans.

Crude prices were higher, rising above &&6;67 a barrel as the dollar eased, while investors are focusing on talks over Iran&&9;s nuclear plans.

Metal prices also stayed firm, helped by the weaker dollar. Gold was poised to post its best quarterly performance since the first quarter of 2008.

The U.S. dollar (.DXY) slipped against major currencies on month- and quarter-end buying lifting sterling and the yen. The greenback was down 0.4 percent at 89.76 yen.

The euro held firm ahead of the European Central Bank&&9;s one-year cash tender results. Attention will focus on the amount of liquidity pumped into the system.

Lacklustre demand would strengthen the ECB&&9;s belief that money markets are on the mend, But strong demand would mean levels of cash held by banks remain at exceptionally high levels until the middle of next year, unless the ECB takes steps to drain it from the market.

The Australian dollar, which has been on the uptrend after recent market talk about an imminent rate hike lifts its yield allure, received a further boost as data showed consumers continue spending even as the stimulus programme nears its end. The Aussie dollar was up 1 percent at &&6;0.8795.

Yields on benchmark 10-year U.S. Treasuries were up 2 basis points at 3.316 percent, while the 10-year euro zone Bund yield was up 1 basis points at 3.232 percent.

(Additional reporting by Jon Hopkins and Jamie McGeever in London and Umesh Desai in Hong Kong, editing by Mike Peacock)

Europe shares set for best quarterly rise in 10 years

PARIS &S212; While the world&S217;s airlines will continue to suffer steep financial losses in the short term, Airbus predicted Thursday that demand for new aircraft would remain healthy over the next 20 years, thanks to steady air traffic growth in the developing world and the rapid expansion of low-cost carriers.

The European plane maker forecast that airlines would buy nearly 25,000 new jets between now and 2028, with a market value of $3.1 trillion. That represents an increase of 2.7 percent from its previous forecast in February 2008, when air carriers were still reeling from the initial brunt of the global economic crisis.

Airbus, which expects to secure orders for around 300 planes this year, also said that the steep decline in world air traffic would likely stabilize in 2010 and could rise by as much as 4.6 percent &S212; not far from the average 5 percent growth over the past 30 years. The company forecast a drop in 2009 traffic of between 2 percent and 4 percent.

&S220;Air transportation is a growth industry and an essential ingredient in the world economy,&S221; said John Leahy, Airbus&S217;s chief salesman.

The International Air Transport Association said Wednesday that it expected the world&S217;s airlines to lose $11 billion this year on top of a $16.8 billion loss in 2008. But despite those hefty losses, Mr. Leahy said Airbus had seen relatively few order delays and cancellations.

&S220;A lot of people have talked about massive cancellations in the recession, but that&S217;s not really true,&S221; Mr. Leahy said at a presentation in London. He said Airbus had received fewer than 40 cancellations this year, less than 1 percent of the company&S217;s order backlog of around 3,600 planes. Still, he acknowledged that many customers were having difficulty securing financing and had postponed deliveries &S212; some by several years.

&S220;I think it&S217;s going to be a difficult winter,&S221; Mr. Leahy said, noting that while airlines had managed to fill most of their seats during the peak summer travel season, many had been forced to cut fares, leaving them with less cash.

&S220;At some point, we see a continuation of some requests for deferrals, but even that is already included&S221; in the 20-year forecast figures, he said. He declined to specify how many orders had been delayed so far.

The company&S217;s American rival, Boeing, has at least 64 order cancellations this year, almost all of them for its forthcoming 787 &S220;Dreamliner,&S221; which has been delayed more than two years by production snags credit reports free.

Analysts have warned that the ballooning industry losses are almost certain to lead to further delays and cancellations of orders in the months to come. Without steep cuts in production by both Boeing and Airbus, that could lead to significant surpluses of aircraft on the market, which could weigh heavily on jet prices. Analysts at UBS last month forecast that there would be a global surplus of 1,400 commercial jets by the end of this year.

&S220;We&S217;re still very cautious,&S221; Mr. Leahy said in a telephone interview, though he insisted global overcapacity currently stood at no more than 350 planes. &S220;Right now, there is more downside risk than upside potential.

Airbus said it continued to see the greatest demand for passenger planes in the Asia-Pacific region, particularly in China and India. Asia is expected to account for 31 percent of new aircraft sales over the next two decades, followed by Europe, with 25 percent, and North America, with 23 percent. Sales in Europe and North America will largely be driven by the need to replace older, less fuel-efficient fleets, as well as the continued expansion of low-cost carriers, which currently represent about one-fifth of all seats sold.

More than two-thirds of the new planes to be sold will be single-aisle jets like the Airbus A320 and the Boeing 737, which are used heavily by low-cost airlines, Airbus said. Large twin-aisle planes like Airbus&S217;s planned A350-XWB and the Boeing 787 will probably represent about 25 percent of the aircraft sold, while planes that seat 400 or more passengers &S212; the A380 and the Boeing 747 &S212; will be about 7 percent of the market.

The Airbus 20-year forecast compares with one published by Boeing in June, which predicted sales of 29,000 commercial planes over the same period, down from a 2008 estimate of 29,400 planes.

The Russian state-controlled airline Aeroflot said Thursday that it plans to cut up to 2,000 jobs amid plunging profits, The Associated Press reported from Moscow.

Irina Dannenberg, an Aeroflot spokeswoman, said the cuts will occur within the next six months and will amount to 13 percent of the work force for the airline &S212; Russia&S217;s largest carrier.

The company&S217;s net profit fell in July by 88 percent to $37 million compared to a year ago.

Airbus Sees Healthy Long-Term Demand for New Planes

(Reuters) – Stock index futures pointed to a lower open on Wall Street on Monday, with futures for the S&P 500 down 0.63 percent, Dow Jones futures down 0.7 percent and Nasdaq 100 futures down 0.7 percent.

Sprint Nextel (S.N) will be in the spotlight after The Sunday Telegraph reported that German group Deutsche Telekom (DTEGn.DE) was considering a bid for the U.S. company, sending Nextel&&9;s shares traded in Frankfurt (S.F) jumping 20 percent in early trade.

Also on the mergers and acquisitions front, British confectioner Cadbury (CBRY.L) turned up the heat in its defense against a takeover bid from Kraft (KFT.N) on Saturday as its Chairman Roger Carr said it was an "unappealing prospect" being absorbed into Kraft&&9;s low growth conglomerate business model.

The dollar rose broadly on Monday with the Australian and New Zealand dollars down sharply as speculators covered short positions that had pushed the greenback to one-year lows.

Oil fell more than a dollar toward &&6;68 a barrel on Monday as a rebound in the beaten-down U.S. dollar and nagging concerns that prices may have run ahead of market fundamentals extended last week&&9;s late sell-off.

*Morgan Stanley has raised its forecast of U.S. crude oil price to &&6;105 a barrel in 2012 from &&6;95 due to tightening spare capacity, the U.S. bank said in a research note seen on Monday. It expected global spare production capacity to stay ample through end-2010, before declining in 2011 and reaching 2007/08-like tightness by 2012.

President Barack Obama will try on Monday to revive a stalled push for stricter oversight of Wall Street, using the anniversary of Lehman Brothers&&9; collapse to argue for sweeping regulatory changes.

Chinese media and officials have heaped scorn on a U.S. decision to impose special duties on Chinese-made tires, extending Beijing&&9;s warnings that the move may fuel trade friction as global growth struggles to revive. U.S. President Barack Obama announced the safeguard duties on tire imports from China on Friday, a decision the White House said was meant to stifle disruption from cheap Chinese imports.

China&&9;s sovereign wealth fund is in talks to take a minority stake in power company AES Corp (AES no fax cash advances.N), the Wall Street Journal said, citing people familiar with the matter.

Chevron Corp (CVX.N) and its partners gave a formal green light to building the Gorgon liquefied natural gas project in Australia, the world&&9;s biggest new development, at a lower than estimated cost of &&6;37 billion.

Bank of New York Mellon (BK.N) may lend &&6;4 billion to Russia as a part of an out-of-court settlement of a &&6;22.5 billion lawsuit against the bank, Kommersant business daily reported on Monday.

Japan&&9;s Nikkei stock average fell more than 2 percent in moderate trade on Monday, with Toyota Motor Corp (7203.T) and other exporters battered as the dollar hit a 7-month low against the yen. Shares in Japan Airlines (9205.T) jumped 8 percent on Monday on news American Airlines and Delta Airlines (DAL.N) are considering rival investments in the struggling carrier to secure partnership ties and boost revenue from Asia.

European shares retreated in early trade on Monday, breaking a six-session winning streak and pulling back from 11-month highs, with banks and resource-related shares such as Banco Santander (SAN.MC) and Total (TOTF.PA) leading the fallers.

U.S. stocks broke a five-day winning streak on Friday on a drop in crude oil prices and while data showing a stronger-than-expected rise in consumer sentiment and a bright outlook from shipper FedEx (FDX.N) were not enough to motivate buyers in an equities market recently saturated with good news.

The Dow Jones industrial average (.DJI) lost 22.07 points, or 0.23 percent, at 9,605.41. The Standard & Poor&&9;s 500 Index (.SPX) shed 1.41 points, or 0.14 percent, at 1,042.73. The Nasdaq Composite Index (.IXIC) fell 3.12 points, or 0.15 percent, at 2,080.90. For the week, the Dow was up 1.7 percent, the S&P was up 2.6 percent, and the Nasdaq was up 3.1 percent.

(Reporting by Blaise Robinson; Editing by David Cowell)

Stock futures signal dip; Nextel in focus

NEW YORK (Reuters) – Is it game over for the recession? Or will consumers stay in hibernation?

Investors will watch next week&&9;s new home sales and consumer data to see if the economy&&9;s recovery is on track and whether U.S. stocks -- now at 2009 highs -- will extend their rally.

On Friday, Wall Street got more confirmation that the economy is on the mend with a report showing existing home sales in July rose 7.2 percent -- the fastest pace in nearly two years and a sign that housing is pulling out of a three-year slump. The data, combined with stronger-than-expected second-quarter earnings, pushed the Standard & Poor&&9;s 500 and the Nasdaq to the highest levels since last October.

So the report on new home sales for July, due next Wednesday, is likely to get more scrutiny than usual from investors who want proof that the rally has been driven by more than hope for an economic turnaround.

"What we&&9;ve seen so far has been data signaling that it&&9;s the end of the recession," said Kevin Caron, market strategist at Stifel, Nicolaus & Co in Florham Park, New Jersey.

Next week&&9;s "data will be very important in determining if these trends are artificial, or if they&&9;re sustainable," Caron added.

Other major indicators on next week&&9;s economic calendar include consumer confidence, durable goods orders, GDP, personal income and consumption, and consumer sentiment.

For the week, the Dow Jones industrial average (.DJI) ended up 2 percent, the S&P 500 (.SPX) gained 2.2 percent and the Nasdaq (.IXIC) climbed 1.8 percent. The S&P 500 is up 51.7 percent from its 12-year closing low set on March 9.

Stronger-than-expected second-quarter earnings have helped bolster stocks over recent weeks. The S&P 500 is up about 11 percent since July 1.

Of the 480 companies in the S&P 500 that have reported second-quarter results so far, 73 percent beat expectations, while 9 percent were in line with expectations and 19 percent were below expectations. That compares with 61 percent of companies beating expectations in a typical quarter, according to Thomson Reuters.

For the year, the Dow is up 8.31 percent, while the S&P 500 is up 13.60 percent and the Nasdaq is up 28.15 percent.

HOME SWEET HOME

Single-family home prices for June, due from the Standard & Poor&&9;s/Case-Shiller home price index on Tuesday, are forecast to rise 0.2 percent, which would confirm May&&9;s surprising turnaround.

New home sales in July are expected to rise to an annual rate of 390,000 units, according to economists polled by Reuters. June&&9;s new home sales came in at an annual rate of 384,000 units. Coupled with Friday&&9;s better-than-expected existing home sales figures, optimism about the housing market could continue stocks&&9; advance.

"We got a terrific existing home sales number and I hope to see follow-though (from) the Case-Shiller data," said Phil Orlando, chief equity market strategist at Federated Investors in New York.

"If the data continues to improve, then the bears who have been very wrong (during this past rally) are really gonna have to throw in the bone now," he said.

HEY, BIG SPENDERS

Factors that could dampen the market&&9;s buoyance and reverse its direction are weak consumer sentiment and a lack of spending.

About 70 percent of GDP is derived from consumer spending. So the economic recovery will depend on consumers resuming their love affair with the retail sector. The government will take a second look at second-quarter GDP on Thursday. Economists polled by Reuters believe that GDP contracted at an annual rate of 1.4 percent in the second quarter, exceeding the initial estimate of a 1 percent decline.

The U.S. consumer confidence index for August will be released on Tuesday by the Conference Board, a New York-based private research group. The Reuters poll called for an index reading of 47.5, up from July&&9;s slide to 46.6, which was substantially below expectations.

"Consumers are still pretty hunkered down," said Scott Wren, senior equity strategist at Wells Fargo Advisors in St. Louis.

The U.S. Commerce Department will release July numbers on U.S. durable good orders on Wednesday. The Reuters forecast calls for overall durable goods orders to rise 3.2 percent in July after June&&9;s worse-than-expected drop of 2.2 percent.

The Reuters/University of Michigan Surveys of Consumers will give a final reading on August consumer sentiment on Friday. The Reuters poll calls for a reading of 64, down from a preliminary figure of 66.0, which was the lowest since March.

Also on Friday, personal income and consumption figures for July will be watched for what they say about how much consumers are saving rather than spending.

Quarterly earnings from high-end jeweler Tiffany & Co (TIF.N) could shed some light on whether affluent consumers are shopping again -- or keeping a tight grip on their wallets.

Just a handful of S&P 500 companies will report results next week, but the whole spectrum of the retail sector -- from the ultra-bargain segment represented by Big Lots (BIG.N) and Dollar Tree Stores (DLTR.O) to such back-to-school destinations as office supplies store Staples (SPLS.O) and teen outfitter American Eagle (AEO.N) -- will be represented.

Stronger-than-expected earnings so far have proven companies&&9; ability to plump up their bottom lines by cutting costs.

But further growth needs to come from increased revenue, analysts say. If consumers do not return to stores, the market may have celebrated too soon, said Keith Springer, president of Capital Financial Advisory Services in Sacramento, California.

"The market&&9;s putting the cart before the horse, trying to convince (itself) that the recovery exists. (But) the emperor has no clothes," he said. "The consumer will not come back. The consumer is dead."

With the three major U.S. indexes gaining between 7 percent and 9 percent over the past five weeks, stocks seem ripe for a pullback. But analysts argued that the amount of "cash on the sidelines" is substantial enough that good economic data could spark another run-up, with momentum coming from investors "chasing the market."

"Those portfolio managers who&&9;ve missed the rally have got to look for an opportunity to put that cash to work," Orlando said. "So any pullback is likely to be muted."

(Reporting by Rachel Chang; Editing by Jan Paschal and Caroline Valetkevitch)

Housing and consumers may drive rally next week

FRANKFURT (Reuters) – General Motors (GM.UL) board of directors will discuss on Friday the sale of its European business Opel, for which both Magna (MGa.TO) and RHJ (RHJI.BR) are in the hunt, several sources close to the deal said.

"We are on the home stretch," one of the sources said on Wednesday, adding the GM board aimed to recommend one of the suitors at the meeting.

Trustees who oversee a majority stake in Opel -- which was ringfenced and propped up with German state aid in May to avoid being swept into GM&&9;s brief bankruptcy -- have to approve any decision.

GM declined to comment.

German Chancellor Angela Merkel and German states that are home to Opel plants have come out clearly in favor of the Magna offer because they think the Canadian automotive group&&9;s expertise can save more of the 25,000 Opel jobs in Germany.

Belgium-based financial investor RHJ&&9;s offer for Opel seeks less European state aid and has won favorable comments from some GM officials, but is viewed skeptically in Berlin and by Opel&&9;s labor leaders.

(Reporting by Philipp Halstrick, Angelika Gruber and Patricia Uhlig; Editing by Dan Lalor)

GM board to meet on Friday on Opel sale: sources

WASHINGTON (Reuters) – U.S. employers cut 247,000 jobs in July, far less than expected and the least in any month since last August, according to data on Friday that provided the clearest evidence yet that the economy was turning around.

With fewer workers being laid off, the unemployment rate eased to 9.4 percent in July from 9.5 percent the prior month, Labor Department data showed, the first time the jobless rate had fallen since April 2008.

The government revised job losses for May and June to show 43,000 fewer jobs lost than previously reported.

Analysts had expected non-farm payrolls to drop 320,000 in July and the unemployment rate to rise to 9.6 percent. The forecast was made earlier this week before other jobs data prompted some economists to lower their estimates for job losses.

U.S. stock index futures jumped on the data, which was seen as more evidence the economy&&9;s healing process had started. U.S. government bond prices tumbled and the dollar rose against the Japanese yen.

"This is positive news. This is the best showing (since) prior to the financial meltdown and those are important benchmarks to achieve," said Richard Dekaser, president of Woodley Park Research in Washington.

Data ranging from home sales to manufacturing have pointed to an economy starting to dig itself out of the worst recession since the Great Depression of the 1930s.

The fall in the jobless rate will be good news for President Barack Obama, who has seen his standing in public opinion polls slip as Americans fret about the weak economy and high unemployment.

MOSTLY GOOD NEWS

While employers cut fewer jobs than forecast in July, unemployment remains stubbornly high, meaning households have less income to spend. This could set the economy for an anemic recovery, analysts say.

Moreover, in July the workforce fell by 422,000, far more than the 155,000 decline in June, suggesting jobless workers may have given up looking for new work no teletrack payday loans.

Since the start of the recession in December 2007, the economy has shed 6.7 million jobs, the department said, adding that the number of long-term unemployed continues to rise.

Job losses in July were spread across all sectors, but the pace of firings slowed markedly from previous months.

Manufacturing employment fell by 52,000 -- the first time since September losses were less than 100,000 -- after shrinking by 131,000 in June. This was probably due to the reopening of General Motors and Chrysler assembly plants after bankruptcy closures.

"Because layoffs in auto manufacturing already had been so large, fewer workers than usual were laid off for seasonal shutdowns in July," Labor Commissioner Keith Hall said, adding that the seasonally adjusted gain did not indicate an improvement in the industry.

Payrolls in construction industries slipped 76,000 after falling 86,000, likely reflecting spending on infrastructure projects from the government&&9;s &&6;787 billion stimulus package and a modest pickup in ground breaking for new homes.

In the service-providing sector, 119,000 workers were laid off, and the goods-producing industries purged 128,000 positions.

Education and health services continued to add jobs, with payrolls increasing 17,000 in July after rising 37,000 in June. Government employment increased 7,000 after slipping 48,000 in June.

The closely watched average work week, the total amount of labor input, inched up to 33.1 hours in July after having slipped to 33.0 in June. The average work week in the manufacturing sector rose to 39.8 hours from 39.5 hours in June, the department said.

Average hourly earnings increased to &&6;18.56 in July from &&6;18.53.

(Additional reporting by Richard Leong in New York, Editing by Andrea Ricci)

Payrolls fall less in July, jobless rates eases

WASHINGTON (Reuters) &<51; The Federal Trade Commission on Thursday issued a final rule to fight oil market manipulation.

The agency said its rule would prohibit fraud or deceit in wholesale petroleum markets, and omissions of material information that is likely to distort petroleum markets.

&S220;This new rule will allow us to crack down on fraud and manipulation that can drive up prices at the pump,&S221; the agency chairman, Jon Leibowitz, said in a statement. &S220;We will police the oil markets &<51; and if we find companies that are manipulating the markets, we will go after them.&S221;

The rule applies to the sale or purchase of crude oil, gasoline or petroleum distillates, the agency said creditreport.

Wrongdoers face civil fines of up to $1 million a day per violation. The rule takes effect on Nov. 4.

Violations include false public announcements of planned pricing or petroleum output decisions, false statistical or data reporting, and so-called &S220;wash sales&S221; intended to disguise the actual liquidity of a market or the price of a particular oil product.

F.T.C. Rule Aimed at Oil Price Manipulation