Verizon Leads in Wireless Competition

Verizon Communications, Inc. and Motorola, Inc., two members of the wireless industry's royalty, are expected to reveal their quarterly results next week, but only Verizon is likely to be crowned a success. The carrier has already stated a 1.5 million gain in net wireless subscribers. Although Verizon continues to lose local-phone subscribers, it has more than offset its losses by selling more wireless, Internet and even TV services.

Motorola, by contrast, is aiming to slow a steep decline in its wireless handset-making division, while the prospects of better days ahead remain dim. The vendor keeps losing market share and has failed to introduce compelling new phones that would halt its slide. Verizon Communications, Inc. (VZ) closed this week at $34.45. Motolora, Inc. (MOT) closed this week at $7.25.

A Shining Quarter for Netflix

Netflix, the online movie rental provider, reported a strong end to their second quarter. The company experienced 25% growth in subscribers from the previous year, approximately 8.4 million in total subscribers. Netflix relied on their strategy in offering subscribers the option of streaming video directly to their TVs with the introduction of The Netflix Player by Rok in May. Earlier this month, it was announced that Microsoft will embed Netflix streaming capability in the Xbox 360 video game and entertainment system.

In many ways, Netflix was able to keep its subscribers without much effort because its main rival, Blockbuster Inc., was distracted by its unsuccessful attempt to takeover Circuit City Stores, Inc. Netflix, Inc. (NFLX) closed this week at $27.85. Blockbuster, Inc. (BBI) closed this week at $2.56. Circuit City Stores, Inc. (CC) closed this week at $2.22.

Exxon's $1.1 Billion Development

Exxon Mobil Corporation announced that the Gippsland Basin Joint Venture, which includes its subsidiary, Esso Australia, will invest $1.1 billion to develop more than 270 million oil-equivalent barrels from the Turrum field in the Bass Strait, offshore of southeast Australia. The development follows the recent announcement of $1 billion in funding to develop natural gas from the Kipper field, also in the Bass Strait.

Esso Australia is the Turrum field operator and holds 50% interest with BHP Billiton. Esso Australia operates 21 offshore oil and gas production facilities in the Bass Strait and also operates and holds 32.5% interest in the Kipper Unit Joint Venture with BHP Billiton and Santos Limited. Esso Australia has produced oil and gas from the Bass Strait offshore fields for nearly 40 years. The Turrum and Kipper projects are among 119 in Exxon Mobil's industry-leading portfolio to support development of more than 24 billion oil-equivalent barrels of energy. Exxon Mobile Corp. (XOM) closed this week $81.70.

The Dow started the week at 11,496 and closed at 11,370. The NASDAQ began the week at 2,282 and finished at 2,310. The S&P 500 started at 1,260 and ended at 1,257.

Treasurys Continue to Slide

Treasurys declined this week as economic reports are showing stabilization in the economy. Durable goods orders rose 0.8% in contrast to the 0.3% decline. This rise illustrates that the global manufacturing market is taking advantage of the weak dollar. While existing home sales are at their lowest pace since 1998, consumer sentiment reached 61.2.

Analysts are trying to determine if the economy continues to stabilize what action, if any, will the Fed impose in August. Roughly half of analysts surveyed by Market Watch are expecting an increase of 2.25%. November futures estimate a 40% chance of a second rate change in October.

The 10-year Treasury note began the week at 4.08% and finished at 4.08%. The 30-year Treasury bond began at 4.66% and finished at 4.66%.

Rates Jump with Weak Market

In Freddie Mac's Primary Mortgage Market Survey, long and short-term rates increased this week by 0.4%. The 30-year fixed-rate mortgage (FRM) reached 6.63%, inching closer to the July 2007 rate of 6.69%. The 15-year FRM is 6.18%, still 0.19% lower than the rate this time last year.

"Market concerns about rising inflation and the greater probability that the Federal Reserve (Fed) will raise short-term rates this year all combined to push mortgage rates higher this week," said Frank Nothaft, Freddie Mac Vice President and Chief Economist. "Some of the key drivers to these concerns were consumer prices jumping 1.1% (annualized) in June - the largest increase since September 2005 on a year-over-year basis - coupled with consumer prices growing at a 5.0% clip (on a year-over-year basis), the strongest since February 1991."

The 30-year loan rate started at 6.33% and finished at 6.33%. The 15-year loan began at 5.86% and finished at 5.86%. The money market fund began at 2.38% and finished at 2.38%. The $10,000 money market fund started at 2.56% and finished at 2.56%. The 1-year CD started at 3.47% and finished at 3.47%.