- Euro-Area Growth Eases Pressure on Draghi for Stimulus (BBG)
- Germany Beats Growth Estimates With France Amid Recovery (BBG)
- Argentina revises ‘bogus’ inflation figures (FT)
- Wells Fargo edges back into subprime as U.S. mortgage market thaws (Reuters)
- China Banks’ Bad Loans Reach Highest Since Financial Crisis (BBG)
- Time Warner Cable Deal to Test Comcast CEO’s Washington Clout (WSJ)
- Risky Loans in Europe Banks’ Dark Corners to Be Exposed (BBG) – yeah, right… sure
- Gold Extends Climb Above $1,300 as Investors Boost SPDR Holdings (BBG)
- SEC Takes Steps to Stem Courtroom Defeats (WSJ)
- Treading softly, Thai riot police reclaim Bangkok protest sitea (Reuters)
- Topix Index Tumbles as Yen Rises, Consumer Lenders Slide (BBG)
- Taliban Take Toll on Pakistan’s Biggest City (WSJ)
- Chinese Join Winklevosses in L.A. Luxury Home Hedges (BBG)
- World’s Biggest Sovereign Fund Needs to Add Risk (BBG)
Overnight Media Digest
* Now that Comcast Corp has sealed a deal to buy Time Warner Cable Inc for $45.2 billion in stock, its top executives face a new challenge: clearing formidable regulatory hurdles. The government review is likely to be lengthy and could touch on everything from cable prices to the way web traffic is prioritized.
* Americans cut spending last month on a broad swath of retail goods including cars, furniture and clothing, raising fresh doubts about the economy’s ability to gain speed this year.
* BNP Paribas SA France’s largest listed bank, is in talks to settle U.S. investigations of money laundering and sanctions violations in countries including Iran and Cuba, according to people familiar with negotiations.
* China’s inflation remained tepid in January, but economists said that the country’s central bank still has little room to ease monetary policy as concerns over growing debt overshadow slowing economic growth.
* Brookstone Inc, known for its wide array of consumer gadgets such as massage chairs and travel electronics, is contemplating a possible bankruptcy-protection filing in the coming weeks as talks advance with potential buyers, people familiar with the matter said.
* PepsiCo Inc is throwing a bone to investors after deciding it will keep trying to turn around slumping soft-drink sales instead of taking more drastic action, such as splitting up.
* Avon Products Inc said it might need to pay as much as $132 million to settle a federal bribery probe, significantly increasing its estimates for the cost of resolving the yearslong investigation into its past conduct in China and other countries.
* Boeing Co is planning new marketing tactics to extend sales of its leading long-range jet for several more years until a new version is ready, the company’s top salesman said.
* South Korea has addressed U.S. concerns about letting a Chinese telecommunications company develop the country’s advanced wireless network by agreeing to route sensitive U.S. and South Korean communications over separate networks, U.S. officials said.
* Cabela’s Inc, an outdoor-gear retailer, cited a slide in sales of guns and ammunition when it reported Thursday a decline in fourth-quarter sales, excluding newly opened or closed stores.
* Comcast Corp’s proposed acquisition of Time Warner Cable Inc comes at a moment of seismic change in the television industry, with consumers increasingly cutting their cable cords and instead streaming their favorite shows via the Internet.
* The Ivanpah solar power plant stretches over more than five square miles of the Mojave Desert with an ability to energize 140,000 homes. The plant, the first electric generator of its kind, could also be the last. Since the project began, the price of rival technologies has plummeted, incentives have begun to disappear and the appetite among investors for mammoth solar farms has waned.
* Paris-based BNP Paribas’s fourth-quarter profit fell 76 percent as it set aside $1.1 billion to settle charges it violated economic sanctions.
* Big banks operating in London are adhering to the European Union’s rules on banking bonuses by revamping the way they pay top employees so they still receive the extra money.
* The Bridgestone Corp became the latest automotive supplier to plead guilty to charges of conspiring to fix the prices of parts sold to automakers here and abroad, the justice department said on Thursday. The world’s largest producer of tires and rubber also agreed to pay a $425 million criminal fine.
* A 120-car Norfolk Southern train carrying heavy Canadian crude oil derailed and spilled in western Pennsylvania on Thursday, adding to a string of recent accidents that have prompted calls for stronger safety standards.
* General Motors Co is recalling about 619,000 small cars in the United States because either a heavy key ring or a “jarring event” such as running off the road could cause the ignition to shut off and possibly prevent the air bags from deploying in a crash, the automaker said.
* People for the Ethical Treatment of Animals has scored again in its fight against the use of primates in advertising, as Volkswagen of America agreed to abide by a no-primates policy and withdrew a video clip from online platforms that had served as a teaser for the company’s commercial during Super Bowl XLVIII on Feb. 2.
* Apple Inc in a report on Thursday said its hardware factories did not use any tantalum, a metal commonly used in electronics, from areas engaged in warfare.
* PepsiCo Inc said on Thursday that it had decided not to spin off its North American beverage business, effectively rejecting a push by the activist investor Nelson Peltz.
* Fortress Investment Group Llc, the first publicly listed hedge fund in the United States, has bought back its 12 percent stake from Nomura Holdings, one of its principal investors for $363.4 million.
* A growing number of primary care doctors and specialists in private practice are becoming employees of hospitals, though experts caution that the change may not yield better or cheaper care for patients.
THE GLOBE AND MAIL
* More than 40 First Nations or aboriginal groups in Canada have applied to participate in National Energy Board hearings into Kinder Morgan Energy Partners’ proposed twinning of the Trans Mountain pipeline. The applications, say First Nation representatives, is a signal of how Canada has changed since the pipeline was first built across British Columbia 61 years ago.
* Under one of the roughest winters in the Upper Midwest region, the Great Lakes had become almost completely covered with ice. The last time they came this close was in 1994, when 94 percent of the lakes’ surface was frozen.
Reports in the business section:
* Bombardier Inc raised its C Series cost estimate by more than $1 billion and forecast weaker profit margins this year, prompting concerns about the company’s finances as it struggles with development delays and uncertain demand for aircraft.
* Quebec’s national assembly is set to begin final adoption next week of a law that will legalize euthanasia in the province, making it the first jurisdiction in North America to allow physicians to deliberately end patients’ lives. Meanwhile, the province’s College of Physicians is already envisaging a day when some of the bill’s restrictions on euthanasia will need to be loosened.
* Fertility specialists are calling for minimum qualifications for doctors offering assisted baby-making procedures like in-vitro fertilization, saying some people are being treated by doctors who don’t have the proper training to perform the procedures.
* The Canadian low-cost carrier, WestJet Airlines Ltd plans to unveil the details of a new in-flight entertainment system on Friday that aims to wirelessly stream stored content and live TV as well as provide WiFi connectivity to its guests.
* The Quebec government is taking control of oil exploration on remote Anticosti, striking joint venture deals with all oil and gas companies holding permits on the island in exchange for funding their drilling programs.
CHINA SECURITIES JOURNAL
– Hundreds of companies waiting for IPOs are preparing annual reports and other documents for an official submission to the securities regulator, sources said.
CHINA BUSINESS NEWS
– China Telecom Corp Ltd said it will start 4G service from Friday, the second Chinese telecom operator to provide the service after China Mobile Ltd.
SHANGHAI SECURITIES NEWS
– China Orient Asset Management Corp, a state-owned asset manager specialising in bad debt, plans to list by the end of 2015 if the company’s reform plan is approved in the first half of this year, its president said.
– Competition among China’s state-owned companies is intensifying in the country’s capital market as they step up efforts to lure investors amid the ongoing ownership reform in the sector.
– China welcomes U.S. Secretary of State John Kerry’s visit to Beijing but his visit would not result in substantially boosting ties between the two countries unless he takes the “correct” approach to the sovereignty dispute in East and South China Seas, said an editorial.
– China should set freedom, equality, justice and rule of the law as the common value to provide constant momentum for the market economy and create moral integrity in society, the paper said in an editorial.
LLOYDS BANKING GROUP CHIEF ANTONIO HORTA-OSORIO GETS 1.7 MLN STG BONUS
Lloyds Banking Group has awarded Chief Executive Antonio Horta-Osorio a 1.7 million pound ($2.83 million) bonus after declaring itself “a normal bank” five years after its bailout.
ROLLS-ROYCE WARNS DEFENCE CUTS TO TAKE TOLL ON 2014 REVENUES AND PROFITS
Rolls-Royce has become the latest major UK company to warn on profits as the industrial group called an end to a decade of revenue growth and wiped more than 3 billion pounds off its share price.
SHELL TO SELL THREE NORTH SEA OIL ASSETS
Shell is to sell off three oil and gas producing assets in the North Sea as the new chief executive’s divestment gathers pace. The disposal of the Anasuria, Nelson and Sean platforms and production systems come at a sensitive political time when other energy bosses have signalled that the forthcoming referendum on Scottish independence is undermining the investment climate.
EX-BOSS OF LLOYDS FACES LOSING BONUS OVER INSURANCE SCANDAL
The former chief executive of Lloyds Banking Group, Eric Daniels, is facing the confiscation of a past bonus over the escalating insurance mis-selling bill, which sent the bank to an after-tax loss of 802 million pounds last year.
HOMESERVE FINED 30.6 MLN STG FOR YEARS OF MIS-SELLING
The board of directors of HomeServe’s British division consistently failed to address regulatory and compliance problems in the run-up to its damaging mis-selling scandal, the City regulator said yesterday as it handed the insurer a record fine.
NUCLEAR OVERHAUL WARMS EDF PROFITS
EDF Energy’s UK profits have been charged after the French company spent heavily to improve the performance of its eight nuclear power stations in Britain.
Tate & Lyle profit warning prompts Chinese takeover speculation
Shares in Tate & Lyle crashed 16 percent in early trading after the sweetener-maker warned on profits, triggering City speculation of a potential Chinese takeover bid.
FCA STUDY WILL TACKLE THE ANNUITIES ‘MINEFIELD’
The annuities market is not working for consumers, Britain’s Financial Conduct Authority has concluded after an extensive review.
Fly On The Wall 7:00 AM Market Snapshot
Import and Export Prices at 8:30 a.m. ET
Industrial Production at 9:15 a.m. ET
Consumer Sentiment at 9:55 a.m. ET
Cabot (CBT) upgraded to Overweight from Neutral at JPMorgan
Comerica (CMA) upgraded to Buy from Neutral at Citigroup
Corrections Corp. (CXW) upgraded to Buy from Fair Value at CRT Capital
Discover (DFS) upgraded to Buy from Hold at Jefferies
Discovery (DISCA) upgraded to Buy from Neutral at Guggenheim
EastGroup Properties (EGP) upgraded to Buy from Hold at Stifel
Grainger (GWW) upgraded to Outperform from Neutral at RW Baird
Home Bancshares (HOMB) upgraded to Buy from Hold at Wunderlich
Huntsman (HUN) upgraded to Neutral from Reduce at SunTrust
Lloyds Banking (LYG) upgraded to Overweight from Neutral at JPMorgan
LogMeln (LOGM) upgraded to Buy from Hold at Needham
PetroQuest (PQ) upgraded to Outperform from Market Perform at FBR Capital
Progressive Waste (BIN) upgraded to Strong Buy from Outperform at Raymond James
Rolls-Royce (RYCEY) upgraded to Hold from Sell at Societe Generale
Societe Generale (SCGLY) upgraded to Buy from Neutral at UBS
Starwood Hotels (HOT) upgraded to Buy from Neutral at UBS
Stratasys (SSYS) upgraded to Market Perform from Underperform at William Blair
TreeHouse Foods (THS) upgraded to Neutral from Underperform at Credit Suisse
Zions Bancorp (ZION) upgraded to Neutral from Sell at Goldman
ATK (ATK) downgraded to Market Perform from Outperform at Cowen
Aeropostale (ARO) downgraded to Market Perform from Outperform at BMO Capital
Agnico-Eagle (AEM) downgraded to Hold from Buy at Canaccord
Agnico-Eagle (AEM) downgraded to Neutral from Buy at UBS
Cadence (CADX) downgraded to Neutral from Buy at Guggenheim
CafePress (PRSS) downgraded to Hold from Buy at Cantor
Cenovus Energy (CVE) downgraded to Hold from Buy at Canaccord
ClearBridge American (CBA) downgraded to Neutral from Buy at BofA/Merrill
DISH (DISH) downgraded to Neutral from Buy at Citigroup
Ducommun (DCO) downgraded to Hold from Buy at Canaccord
EQT Midstream Partners (EQM) downgraded to Neutral from Outperform at Credit Suisse
Foster Wheeler (FWLT) downgraded to Hold from Buy at BB&T
Foster Wheeler (FWLT) downgraded to Neutral from Outperform at Macquarie
Manchester United (MANU) downgraded to Market Perform from Outperform at Raymond James
Munich Re (MURGY) downgraded to Sell from Hold at Societe Generale
Targa Resources (TRGP) downgraded to Market Perform from Outperform at Wells Fargo
Tractor Supply (TSCO) downgraded to Perform from Outperform at Oppenheimer
Allscripts (MDRX) initiated with an Outperform at RBC Capital
Cerner (CERN) initiated with an Outperform at RBC Capital
Computer Programs (CPSI) initiated with an Outperform at RBC Capital
Cumulus Media (CMLS) initiated with an Outperform at RBC Capital
Hanover Insurance (THG) initiated with a Buy at Guggenheim
Hibbett Sports (HIBB) initiated with a Hold at Deutsche Bank
MedAssets (MDAS) initiated with a Sector Perform at RBC Capital
Quality Systems (QSII) initiated with a Sector Perform at RBC Capital
RSP Permian (RSPP) initiated with an Outperform at RBC Capital
WebMD (WBMD) initiated with a Top Pick at RBC Capital
athenahealth (ATHN) initiated with a Sector Perform at RBC Capital
eHealth (EHTH) initiated with an Outperform at RBC Capital
Jos. A. Bank (JOSB) to acquire Everest Holdings, parent of Eddie Bauer, for $825M
Weight Watchers (WTW) shares fell 20% after Q4 profit missed expectations, sharply cut fiscal 2014 earnings outlook
Occidental Petroleum (OXY) sold Hugoton Field assets for $1.4B
AIG (AIG) raised quarterly dividend 25%, authorized additional $1B share repurchase
Scripps Networks (SNI) announced additional $1B repurchase plan
S&P lowered to ‘BBB-‘ from ‘BBB’ its long-term corporate credit ratings on Sony Corp. (SNE)
Yahoo (YHOO) acquired Distill
Microsoft (MSFT) said sold 2.27M Xbox games in January
Companies that beat consensus earnings expectations last night and today include:
Cliffs Natural (CLF), J2 Global (JCOM), Cloud Peak (CLD), Cognex (CGNX), Cray (CRAY), Kona Grill (KONA), Radiant Logistics (RLGT), Ingram Micro (IM), Limelight Networks (LLNW), Agilent (A), Brocade (BRCD), Bankrate (RATE), AIG (AIG)
Companies that missed consensus earnings expectations include:
Ensign Group (ENSG), Silvercorp Metals (SVM), CafePress (PRSS), Mercer (MERC), Trulia (TRLA), Newpark Resources (NR), GNC Holdings (GNC), Weight Watchers (WTW), ArthroCare (ARTC), Regal Entertainment (RGC)
Companies that matched consensus earnings expectations include:
Equifax (EFX), Ellie Mae (ELLI), Masimo (MASI), VCA Antech (WOOF)
Charter (CHTR) likely to look at other suitors, unlikely to counterbid for Time Warner Cable (TWC), WSJ reports
Procter & Gamble (PG) considering current and former executives as candidates for CEO job, Reuters reports
Murphy Oil (MUR) may sell about $3B of Asian assets, Reuters reports
AIG (AIG) to cut 3% of global workforce, Bloomberg reports
Wells Fargo (WFC) moves back into the subprime home market, Reuters reports
Goodyear Tire (GT), Sumitomo look to dissolve 15-year partnership, Nikkei reports
GlaxoSmithKline (GSK) interested in Arena (ARNA), Daily Mail reports
Tesla (TSLA) Model S catches fire in Toronto garage, Business Insider reports
Malone’s (LBTYA) cable moves slow with Comcast (CMCSA), Time Warner Cable (TWC) deal, Bloomberg reports
Facebook (FB) privacy settlement up against opposition, AP reports
Celsion (CLSN) files to sell 194,986 shares for holder
Colfax (CFX) 8M share Secondary priced at $68.75
Inogen (INGN) 4.412M share IPO priced at $16.00
Navios Acquisition (NNA) files to sell 12M shares of common stock
Wright Medical (WMGI) files to sell 590K shares of common stock for holders