- Emerging sell-off hits European shares, lifts yen (Reuters) – but not really if you hit refresh since the latest central bank bailout announcement
- Apple’s Holiday Results to Show Whether Growth Is Back (BBG)
- Israel attacked Syrian base in Latakia, Lebanese media reports (Haaretz)
- Abenomics FTW: Japan Posts Record Annual Trade Deficit as Import Bill Soars (BBG)
- When all else fails, Spain’s hope lie in a 16th century saint: Saint “might help Spain out of crisis,” says interior minister (El Pais)
- Global Woes Fail to Send Cash Into U.S. Stocks (WSJ)
- IMF’s Lagarde sees eurozone inflation “way below target” (Reuters)
- Minimum wage bills pushed in at least 30 states (AP)
- AT&T Gives Up Right to Offer to Buy Vodafone Within 6 Months (BBG)
- Greece faces new black hole in finances amid rising tensions with creditors (Guardian)
- Politics, legacy loom over Obama decision on Keystone XL pipeline (Reuters)
- London Afternoon Currency Spikes Subside Under Regulators’ Glare (BBG)
- China’s moon rover monitored with abnormity (Xinhua)
Overnight Media Digest
* Governors across the U.S. are proposing tax cuts, increases in school spending and college-tuition freezes as growing revenue and mounting surpluses have states putting the recession behind them.
* President Obama’s State of the Union address Tuesday will seek to shift the public’s souring view of his leadership by proposing executive actions on infrastructure, job training, climate change and education.
* JPMorgan Chase Chief Executive James Dimon and Frank Bisignano, a former top lieutenant, recently agreed to a multimillion-dollar resolution of a hiring dispute that entangled the largest U.S. lender, a giant private-equity firm and two longtime fixtures on Wall Street.
* The euro zone’s weak inflation is making it difficult for “peripheral” countries such as Spain and Italy to cut debt and become more competitive internationally.
* Many professional investors are acknowledging, sometimes grudgingly, that Ben Bernanke has gone a long way toward achieving the main goal he set in 2008: He has stabilized markets and restored a large measure of investor and public confidence.
* Michaels Stores Inc said it may have been the victim of an attack on its data security, making it the third major chain in a rash of assaults aimed at U.S. retailers.
* U.S. corporations have worked for two decades to fend off securities class-action lawsuits. But new figures show that such cases have not abated.
Stockholders filed 234 federal securities class-action suits against U.S. companies last year, the most since 2008, according to a report by NERA Economic Consulting.
ECB President Mario Draghi has hinted at buying bank loans to households and companies in an attempt to fight deflation in Europe. Speaking at the World Economic Forum in Davos, Draghi said ECB will leave its interest rates low for a long time and will act if situation warrants.
A research shows 31 companies of the FTSE-350 list warned of lower profits for the quarter ended December. Professional services firm EY said the same number of profit warnings was issued during the fourth quarter of 2008, the year of the financial crisis.
The UK car industry is set to see a 1 percent rise in new car sales in 2014 as fears of a saturated market disappear. UK’s biggest car manufacturers told FT that they are expecting a more than 10 percent growth from last year.
U.S. private-equity firm Warburg Pincus has appointed Peter Kukielski, ArcelorMittal’s former mining head, as “executive in residence” to aid its plan to buy non-core assets from natural resource groups.
A group of 22 insurers is preparing to launch a system to model natural disasters which would help them curb excessive exposure to heavy costs for calamities. Allianz, Zurich and the Lloyd’s of London are part of this group.
* Federal prosecutors are trying to thwart the easy access that predatory lenders and dubious online merchants have to Americans’ bank accounts by going after banks that fail to meet their obligations as gatekeepers to the U.S. financial system.
* There will be enough money to recapitalize banks that fail a review by the European Central Bank later this year, top European leaders said on Saturday, seeking to assuage lingering doubts whether policy makers will succeed in cleaning up the financial system and restoring the flow of credit.
* The British bank HSBC has apologised after reports that some customers were prevented from withdrawing large sums of cash from their accounts. HSBC said as part of a policy change put into effect in November, it began asking customers in some instances to show evidence of what they planned to do with large cash withdrawals.
* Uber, the hot start-up whose software allows anyone with a smartphone to get a cab ride, is suddenly facing trouble.
* NBCUniversal, a division of Comcast Corp, said it has extended the contract of Donna Langley, chairwoman of Universal Pictures, through 2017 and handed her oversight of worldwide marketing and overseas production.
* Google and Samsung Electronics Co Ltd , which are frequently involved in patent infringement lawsuits but not against each other, said on Sunday that they had reached a global patent cross-licensing agreement.
* Martin Marietta Materials Inc, a big producer of sand and gravel, is in late-stage talks to acquire Texas Industries Inc, according to people briefed on the matter. A deal for Texas Industries, a construction supplies company, could be announced early next week, these people said.
* Residents of Casselton, N.D., are concerned about the crude oil convoys that roll through their town, as what was once a stopgap becomes commonplace and safety standards lag.
* The bursting of the housing bubble didn’t deter affluent buyers for long. They are pouring back into the market, and adding options galore to their new homes.
* The Australia and New Zealand Banking Group is making big bets to court China, including Chinese-language signage and displays at the Australian Open tournament.
* In what may be the latest in a continuing spate of cyberattacks on American retailers, Michaels Stores said Saturday that it was investigating a potential security breach involving customers’ credit card information.
* After a week of speculation, it turns out that Ezra Klein, the prolific creator of The Washington Post’s Wonkblog, will be going to Vox Media, the online home of SB Nation, a sports site, and The Verge, a fast-growing technology site.
* The attendees at this year’s World Economic Forum have been hearing a consistent message, share your riches.
* Arianna Huffington and Nicolas Berggruen, a billionaire investor, announced the creation of WorldPost, a new website under the Huffington Post umbrella aimed at international issues.
THE GLOBE AND MAIL
* More than a million people across Canada worked for minimum wages or less last year, the fourth year in a row that number has been above the one million mark, according to Statistics Canada data. Since 2000, their numbers have nearly doubled.
* Worried Canadian pork producers are stepping up measures to fend off a potentially devastating virus that has cut a deadly swath across the United States and is showing its first signs of life across the border.
Reports in the business section:
* Cash offers have been skyrocketing, as much as seven-fold, for holdout Nebraska landowners who are willing to sign quickly to allow the Keystone XL pipeline onto their property.
* As the world outside sought to identify who or what is to blame for the fire that claimed the lives of 32 nursing-home residents, people of the village took refuge in their 158-year-old church Sunday for a remarkable display of solidarity and compassion.
* A California company is claiming a world first with a Canadian-invented product that pumps contaminated hospital rooms full of antiseptic vapour, theoretically reaching every nook and cranny and letting no bacteria live. The product is a possible solution for “terminal clean,” the exhaustive disinfection of a hospital room tainted by drug-resistant superbugs or other dangerous microbes.
* A weak January doesn’t necessarily mean tech stocks are bound to underperform this year, and analysts and fund managers think they are well positioned to benefit from a rebounding global economy. But following a year of outsized returns, valuations, a perennial concern in the tech sector, have once again become a source of worry.
* A majority of Canadian investors don’t realize how damaging rising interest rates can be to their retirement portfolios, a new poll from CIBC Asset Management has found.
LLOYDS AND TSB HIT BY CARD AND ATM PROBLEMS
Lloyds Banking Group has apologised after customers were unable to withdraw money from cashpoints or pay for goods with their debit cards. The group became aware of the difficulties on Sunday afternoon and later said the problems which lasted for several hours had been fixed.
VIRGIN MONEY SPEARS NEW DIRECTOR BEFORE FLOAT
Sky News understands that Virgin Money will this week name former Deutsche Bank executive Marilyn Spearing as a non-executive director, who joins a board populated by heavyweight City figures such as Sir David Clementi, the bank’s chairman.
OFWAT TO HOLD BACK BIG WATER BILL RISES
Ofwat is expected on Monday morning to announce it has blocked the planned increases in water costs for the years 2015-2020 in effort to call time on the industry’s debt-driven business model.
SENIOR BUSINESS FIGURES HIT OUT AT LABOUR’S 50 PENCE TAX RATE PLAN
In the strongest criticism so far, the heads of 24 of Britain’s most successful companies warned in a letter to The Telegraph that Ed Miliband’s policy would threaten the recovery and cost jobs.
VODAFONE TO SPLASH CASH ON SPANISH ACQUISITION
Vodafone has approached the private equity owners of a Spanish broadband operator Grupo Corporativo ONO SA about a potential 7 billion pound offer as part of its efforts to expand across Europe. The British company is understood to have entered into talks with the shareholders of Ono.
NETWORK RAIL PRESSED TO CUT BOSSES’ BONUSES
Network Rail is under pressure from its members to cut bonuses after scathing criticism of executive pay at the company by the leading judge in England and Wales.
DAVID CAMERON PLEDGES TO RIP UP GREEN REGULATIONS David Cameron will on Monday boast of tearing up 80,000 pages of environmental protections and building guidelines as part of a new push to build more houses and cut costs for businesses. Addressing the Federation of Small Businesses conference, Cameron will argue that the new rules will make it “vastly cheaper” for businesses to comply with their environmental obligations.
FRACKING FIRMS SHOULD PAY 6 BLN POUND A YEAR TAX TO COMPENSATE FOR CLIMATE CHANGE -STUDY
Shale frackers operating in Britain should be paying 6 billion pounds a year in taxes by the middle of the 2020s to compensate for the damage wreaked on the environment, according to a study from Cambridge University.
Fly On The Wall 7:00 AM Market Snapshot
Domestic economic reports scheduled for today include:
New home sales for December will be reported at 10:00–Current consensus 450K
Dallas Fed manufacturing activity index will be reported at 10:30–Current consensus 3.3
Alamos Gold (AGI) upgraded to Outperform from Sector Perform at RBC Capital
Atlas Energy (ATLS) upgraded to Outperform from Neutral at RW Baird
E-Trade (ETFC) upgraded to Outperform from Market Perform at JMP Securities
Edison International (EIX) upgraded to Hold from Underperform at Jefferies
Honeywell (HON) upgraded to Buy from Hold at Lagenberg
MGIC Investment (MTG) upgraded to Outperform from Market Perform at JMP Securities
Merck (MRK) upgraded to Overweight from Underweight at Morgan Stanley
Meritage Homes (MTH) upgraded to Overweight from Equal Weight at Barclays
Mohawk (MHK) upgraded to Overweight from Neutral at JPMorgan
Peabody (BTU) upgraded to Neutral from Underperform at BofA/Merrill
Potash (POT) upgraded to Outperform from Market Perform at Raymond James
Prosperity Bancshares (PB) upgraded to Outperform from Market Perform at BMO Capital
RetailMeNot (SALE) upgraded to Buy from Neutral at Goldman
Xoom (XOOM) upgraded to Strong Buy from Market Perform at Raymond James
Ann Inc. (ANN) downgraded to Neutral from Buy at Janney Capital
BioCryst (BCRX) downgraded to Market Perform from Outperform at Wells Fargo
Cisco (CSCO) downgraded to Underweight from Neutral at JPMorgan
First Niagara (FNFG) downgraded to Hold from Buy at Jefferies
First Niagara (FNFG) downgraded to Market Perform from Outperform at Keefe Bruyette
Idenix (IDIX) downgraded to Underperform from Market Perform at JMP Securities
Integrated Device (IDTI) downgraded to Underweight from Equal Weight at Barclays
KB Home (KBH) downgraded to Underweight from Equal Weight at Barclays
Kansas City Southern (KSU) downgraded to Outperform from Strong Buy at Raymond James
Mallinckrodt (MNK) downgraded to Sell from Neutral at UBS
Manchester United (MANU) downgraded to Hold from Buy at Deutsche Bank
MercadoLibre (MELI) downgraded to Underperform from Neutral at BofA/Merrill
Mosaic (MOS) downgraded to Equal Weight from Overweight at Barclays
Sarepta (SRPT) downgraded to Market Perform from Outperform at JMP Securities
Toll Brothers (TOL) downgraded to Equal Weight from Overweight at Barclays
Xerox (XRX) downgraded to Market Perform from Outperform at BMO Capital
lululemon (LULU) downgraded to Neutral from Buy at Janney Capital
AMC Entertainment (AMC) initiated with a Buy at Citigroup
AMC Entertainment (AMC) initiated with a Neutral at BofA/Merrill
AMC Entertainment (AMC) initiated with an Outperform at FBR Capital
AMC Entertainment (AMC) initiated with an Overweight at Piper Jaffray
AMC Entertainment (AMC) initiated with an Outperform at Credit Suisse
Clearwater Paper (CLW) initiated with an Outperform at RBC Capital
GAIN Capital (GCAP) initiated with a Buy at Jefferies
Layne Christensen (LAYN) initiated with a Hold at Jefferies
Mohawk (MHK) initiated with a Strong Buy at ISI Group
Preferred Apartment (APTS) initiated with an Outperform at Oppenheimer
RAIT Financial (RAS) initiated with a Buy at Deutsche Bank
Seaspan (SSW) initiated with a Neutral at Citigroup
Standard Pacific (SPF) initiated with a Neutral at ISI Group
Taylor Morrison (TMHC) initiated with a Neutral at ISI Group
Liberty Global (LBTYA) to acquire Ziggo for $9.44B in cash, stock
Liberty Global (LBTYA, LBTYK) raised share buyback program by $1B, extended program completion
AT&T (T) doesn’t intend to bid on Vodafone (VOD)
Yahoo (YHOO) acquired Cloud Party, terms not disclosed
Samsung (SSNLF), Google (GOOG) signed global patent license agreement
21st Century Fox (FOXA) acquired majority stake in YES Network
Education Management (EDMC) received inquires on business practices from 12 states
Third Point liquidated stake in Herbalife (HLF)
Teva (TEVA), Active Biotech (ACTI) remain committed to Nerventra following CHMP negative opinion
Companies that beat consensus earnings expectations last night and today include:
Companies that missed consensus earnings expectations include:
Regis (RGS), Home Federal Bancorp (HOME)
- Comcast (CMCSA) not likely to make sole bid for Time Warner Cable (TWC), WSJ reports
- Apple (AAPL) looks to expand mobile payments business, WSJ reports
- BlackRock’s (BLK) Fink warns of too much market optimism, Bloomberg reports
- Wal-Mart (WMT) to eliminate 2,300 Sam’s Club employees, WSJ reports
- Samsung (SSNLF) cut 2014 notebook shipments target to 7M, DigiTimes reports
- Google (GOOG) to acquire DeepMind for $400M, Re/code reports
- Large banks probed over payday lender fees, NY Times reports
- ICE (ICE) CEO Sprecher: Regulators need to look at ‘maker-taker’ trading, Reuters reports
- ESPN (DIS) looks to profit from online video, WSJ reports
- Alibaba moves into mobile games (YHOO), WSJ reports
- Foxconn weighs plans for U.S. panel manufacturing plant (AAPL), WSJ reports
Urban Outfitters (URBN) could rise over 30% in FY14
Hyundai (HYMTF) trades at a ‘steep discount’
AZZ (AZZ) shares could rise almost 20%
Aqua America’s (WTR) price could be an opportunity for a ‘buy and hold’
Deutsche Bank (DB) has ‘plenty of upside’
Bulls will continue to bet on Netflix (NFLX)
Microsoft (MSFT) is inexpensive but leadership questions linger
Ceres (CERE) files to sell $20M of common stock
TherapeuticsMD (TXMD) files to sell 12M shares for holders
Wheeler REIT (WHLR) files to sell 1.83M shares for holders