IBD's Top 10 - Thursday

• Investor's Business Daily
• On 7:05 pm EDT, Thursday October 29, 2009

GDP Grew At 3.5% Pace In Q3

1 Ending a 4-quarter contraction, the U.S. economy expanded at a slightly faster pace than expected. Much of the growth stemmed from the Cash for Clunkers and homebuyer tax credit and other gov't efforts. Auto buys accounted for 1 percentage point 15f growth. Homebuilding shot up 23%. Analysts wonder what will happen as stimulus ebbs in late '10.

Stocks Rally As Economy Grows

2 The GDP report spurred rebounds in stocks, oil and gold. The Nasdaq rose 1.8%, the Dow 2%, S&P 500 2.2% and NYSE composite 2.8%. 192 of IBD's 197 groups rose, but volume was soft. Meantime, crude futures rose $2.41 to $79.87 a barrel; Dec. gold climbed $16.60 to $1,047.10 an ounce. The dollar slid.

House Dems Roll Out Health Bill

3 The 1,990-page measure would cost nearly $900 bil over 10 years and reduce the deficit by $104 bil. But the revised bill now excludes $245 bil in higher doctor payments. The legislation would create a gov't-run insurance plan and require Americans to carry coverage. Despite unanimous GOP opposition, the Dem-led House is expected to pass it next week.

Big Splits Over Fin'l Rules Plan

4 Treasury Sec'y Timothy Geithner said the House panel's plan to revamp banking laws will let regulators wind down failing firms but won't offer a gov't guarantee to big institutions. Republicans said it would lead to permanent bailouts. FDIC Chairwoman Sheila Bair said a systemic risk council lacks authority.

China's iPhone: Now It's Official

5 Apple's (NasdaqGS:AAPL - News) smart phone officially debuts Fri. in the No. 1 cell phone market, offered by No. 2 wireless carrier China Unicom (NYSE:CHU - News). But expectations are mixed, given up-front costs of $850-$1,140 for the Chinese iPhone and estimates that 2 mil iPhones are already in use there. Rivals will include the Android-powered OPhone, backed by No. 1 carrier China Mobile (NYSE:CHL - News).

Exxon Misses On Lower Demand

6 The oil giant's Q3 EPS fell 62% to 98 cents, missing views by 5 cents. Revenue fell 40% to $82.26 bil, below views. Stockpiles are high, and crude oil and natural gas prices fell sharply from a year ago. Exxon Mobil's (NYSE:XOM - News) U.S. oil refining business swung to a loss of $203 mil. Exploration and production saw earnings drop 63% to $4 bil. Exxon shares edged up as crude prices rallied.

Clinton: Pakistan Missed Al-Qaida

7 Sec'y of State Hillary Clinton suggested that Pakistan squandered chances to get al-Qaida leaders. She told reporters in India that after the terrorists fled from Afghanistan into Pakistan in '02, she found it "hard to believe" that the gov't didn't know where they were and couldn't "get them" if they wanted to. The U.S. is pressing Pakistan to crack down on militants based there.

Consumer Products Firms Beat

8 Procter & Gamble (NYSE:PG - News) lifted Q1 EPS 3% to $1.06, 7 cents over views. Sales fell 6% to $19.81 bil, above targets. P&G made progress in winning back recession-hit shoppers who had switched to cheaper brands. Colgate-Palmolive's (NYSE:CL - News) Q3 EPS rose 13% to $1.12, a cent over views. Sales were about flat, but bested views. Kellogg (NYSE:K - News) also beat views. P&G rose 4%, Kellogg 3%, Colgate 2%.

Bond Rates Up On GDP, Auction

9 Investors sold Treasuries following the better-than-expected GDP data. The selling continued after a 7-year Treasury auction resulted in a high yield. The 10-year Treasury yield rose 9 basis points to 3.50%, erasing a large part of the decline from the prior 2 days. Also, the Fed wrapped up its $300 bil Treasury buying program.

McAfee, Sourcefire Top Q3 Views

10 The No. 2 U.S. security software firm's EPS rose 17% to 62 cents -- 2 cents over forecasts. Revenue rose 18% to $485 mil, below views. McAfee (NYSE:MFE - News) fell 5.5% late amid failing to easily top forecasts like No. 1 Symantech (NasdaqGS:SYMC - News). Earlier, Sourcefire (NasdaqGM:FIRE - News) jumped 11% after its Q3 EPS beat views. Revenue jumped 35% to $27.4 mil. It sees Q4 EPS above views.

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