Reports: Mitsubishi UFJ, Morgan eye Japan merger

TOKYO (AP) — Mitsubishi UFJ Financial Group Inc. and U.S. investment bank Morgan Stanley are weighing a merger of their brokerage units in Japan, media reports said Friday.

Japanese public broadcaster NHK reported plans for the merger but did not provide details or cite sources.

Kyodo News agency, quoting sources familiar with the matter, also said Mitsubishi UFJ, Japan's largest bank, was considering merging its securities unit with Morgan Stanley's brokerage operation in Japan.

Mitsubishi UFJ said in a statement Friday that nothing had been decided. The Japanese bank declined to comment further.

Mika Watanabe, a spokeswoman of Morgan Stanley in Japan, said, "Nothing concrete has been decided."

Finance secretary: Ky. weathering Wall St. woes

FRANKFORT, Ky. (AP) — Finance Secretary Jonathan Miller said Friday Kentucky is weathering Wall Street's financial woes better than some other state governments.

In California, for example, financial officials warned this week that the nation's frozen credit markets are threatening the state's ability to do short-term borrowing to pay immediate expenses, and that the state could run out of money by the end of October.

"We're not in a California-type situation," Miller said. "We have sufficient liquidity. We have plenty of cash to allow us to pay our bills, to pay state salaries, and to continue to provide government services. There's no immediate crisis on the horizon."

Congress approved an unprecedented $700 billion government bailout of the battered financial industry on Friday. Miller said he's hopeful the move will ease the credit crisis and boost the market for government bonds.

Diversified industrials a good buy, analyst says

NEW YORK (AP) — Shares of diversified industrial companies are cheap given the actual severity of the current credit crisis, an analyst said Friday, prompting him to recommend buying the sector.

In a research note Friday, Buckingham Research Group analyst Edward Wheeler acknowledged that the global economy is weakening as credit markets contract.

"While the basis for housing-related market conditions to reach cycle lows may be developing as a result of sharply marked-down asset valuations and federal government assistance, it appears prudent to expect relief from current credit market paralysis to be gradual," the analyst wrote. "As a result, the negative impact on consumer spending and capital projects from accelerated credit market contraction over the past few weeks appears likely to have an extended impact, well into 2009, by our estimate."

Delphi CFO leaves, Sheehan named as replacement

TROY, Mich. (AP) — Delphi Corp. on Friday announced the departure of its chief financial officer and named a replacement.

The auto supplier, which has been operating under bankruptcy protection since October 2005, said that Robert Dellinger is leaving the company to pursue outside opportunities.

Delphi named John Sheehan, 48, its chief restructuring officer, as his replacement effective immediately. Sheehan will retain oversight of the company's restructuring.

Delphi officials said Sheehan's appointment will assure a smooth transition as Delphi looks to emerge from bankruptcy.