S&P cuts Bausch & Lomb rating to junk territory

(Reuters) - Bausch & Lomb's credit quality measures were already weak as a result of product recalls, S&P said in a statement. Though finances are expected to improve as the company rebuilds its brand name and expands sales in unaffected businesses, that will not offset an increase in debt because of the acquisition, S&P said.

"Even if the transaction is not consummated ... management's willingness to aggressively increase leverage to this extent is not commensurate with an investment-grade rating," S&P said.


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US STOCKS-Indexes near flat; Citigroup rises 3.7 pct

(Reuters) - Shares of Citigroup climbed 3.7 percent to $54.76 on the New York Stock Exchange after an affiliate of Edward Lampert's hedge fund disclosed it owned more than 15 million shares in the largest U.S. bank. For details, see [ID:nN15262580].

But with the S&P 500 index coming off its sixth straight week of gains, some investors opted to lock in profits and were switching investment strategies.


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Treasury Yields Trade Near Four-Week High as Data Reduce Bets on Rate Cut

(Bloomberg) -- Treasuries were little changed, with yields of 10- and two-year notes trading near four-week highs on signs of strength in the U.S. economy.

Futures traders reduced bets on a cut in borrowing costs by the Federal Reserve as a government report suggested the housing slump may be moderating and Fed data showed industrial output increased more than economists forecast. The central bank held its benchmark rate steady at its policy meeting last week, saying inflation remains the ``predominant'' economic risk.


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Brazil's Real Reaches 6-Year High Amid Speculation of Less Dollar Buying

(Bloomberg) -- Brazil's real gained for a fourth day to a new six-year high on speculation the central bank will reduce efforts to slow the currency's appreciation.

The currency broke through the 2-per-dollar level yesterday for the first time in six years. Over the past two months the central bank bought dollars daily and sold reverse currency swap contracts to cool the rally.


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Oil Falls After Report Shows U.S. Crude, Gasoline Supplies Rose Last Week

(Bloomberg) -- Crude oil fell after the Energy Department reported that U.S. oil and gasoline supplies increased last week as refineries prepared for the peak-demand summer months.

Crude-oil inventories rose 1.06 million barrels to 342.2 million last week, the highest since June, the report showed. Supplies along the Gulf Coast surged 2.38 million barrels. Gasoline and heating oil stockpiles also rose, the report showed. Prices fell earlier today after Reuters reported that protesters in Nigeria left an oil facility run by Royal Dutch Shell Plc.


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TREASURIES-Bonds flat as data fails to alter rates outlook

(Reuters) - NEW YORK, May 16 - U.S. Treasury debt prices were unchanged on Wednesday after data on housing starts and industrial production did little to alter expectations the Federal Reserve will hold interest rates steady over the near term.

The central bank has held the federal funds rate at 5.25 percent since June 2006 as it tries to balance the pace of economic growth with the rate of price inflation.


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UPDATE 1-U.S. union asks SEC intervention on Blackstone IPO

(Reuters) - The AFL-CIO urged the Securities and Exchange Commission to require that Blackstone register as an investment company and submit to oversight under the same law mutual funds follow.

The labor federation told the SEC in a letter that it believed Blackstone "deliberately structured its public offering ... to hide the fact that the Blackstone Group LP is actually an offering of interests in pools of investment securities."


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