Bloomberg:

• Sales of New Homes in U.S. Rose More Than Forecast. Purchases of new houses in the U.S. rose more than forecast in December as the industry struggled to stabilize following its worst year on record. Sales climbed 18 percent to a 329,000 annual pace, figures from the Commerce Department showed today in Washington. The median estimate of economists in a Bloomberg News survey called for a rise to 300,000. The percentage jump was the biggest since 1992, and was led by a record 72 percent surge in the West. For all of 2010, sales fell 14 percent from the prior year to 321,000, the lowest level in data going back to 1963. Purchases climbed in three of four U.S. regions last month. The Northeast showed a 5 percent decrease last month. Sales in California, responsible for part of the surge in the West, may have been boosted ahead of the end of a statewide home buyer tax credit, Daniel Silver, an economist at JPMorgan Chase & Co. in New York, said in an e-mail to clients. Contracts for new-home purchases had to be signed before 2011 to qualify for the incentive, which likely led to a run-up in sales, he said. The median sales price increased 8.5 percent in December from the same month in 2009, to $241,500, today’s report showed. The increase in values probably reflects the change in the mix of sales toward the West where prices are generally higher. The supply of homes at the current sales rate fell to 6.9 month’s worth, the lowest since April, from 8.4 months in November. There were 190,000 new houses on the market at the end of December, the fewest since January 1968.
• EFSF Debut Bond Rises on 1st Day Amid 'Blowout' Investor Demand. The European Financial Stability Facility’s debut 5 billion-euro ($6.9 billion) bond to help pay for Ireland’s bailout rose in the first day of trading after investors bid for nine times the securities on offer. The 2.75 percent notes due July 2016 climbed 0.24 cent on the euro to 99.54 cents as of 1:15 p.m. in London, according to National Australia Bank Ltd. bid prices on Bloomberg. The yield fell to the midswap rate, from 6 basis points over the benchmark when the notes were issued yesterday. The top-ranked securities, backed by euro-region government guarantees, attracted 44.5 billion euros of orders, with investors from Asia buying about 38 percent of the deal. The EFSF issue followed a bond for the same amount by another European Union fund three weeks earlier, which has also rallied in secondary market trading. “The EFSF bond was a blowout,” said Bill Blain, co-head of the special situations group at broker Newedge Group in London. “We understand allocations were cut back close to the square root of zero for most investors,” with China accounting for a “very significant” slice, he said.
• Fed Pushes On With $600 Billion Stimulus. Federal Reserve policy makers maintained plans to buy $600 billion of Treasuries through June, indicating that signs of an accelerating recovery don’t warrant paring back efforts to reduce high unemployment. The expansion is “continuing, though at a rate that has been insufficient to bring about a significant improvement in labor market conditions,” the Federal Open Market Committee said today in its statement after a two-day meeting in Washington. Officials were unanimous for the first time since December 2009.
• Obama Deficit Cuts Dismissed at Davos as Not Deep Enough to Calm Investors. President Barack Obama’s State of the Union address failed to convince executives and economists at the World Economic Forum’s annual meeting that he’s serious about taming the U.S. budget deficit. Hours after Obama used the speech to propose a partial freeze on government spending, delegates at the conference in Davos, Switzerland, said the U.S. is lagging foreign counterparts in cutting a budget deficit of more than $1.2 trillion. “There is an unwillingness to deal with the real gorilla in the room,” said Martin Sorrell, chief executive officer of advertiser WPP Plc. James Turley, CEO of Ernst & Young LLP, said, “we need a heck of a lot more action on it” and that Obama’s speech “lacked details.”
• SAP(SAP) Predicts Profit to Surge as Much as 16% on Demand. SAP AG, the world’s largest maker of business-management software, forecast operating profit will surge as much as 16 percent this year on rising technology spending in the U.S. and emerging markets. “Companies are investing in information technology,” Theo Kitz, an analyst at Merck Finck in Munich, said in an interview. “And there could be more growth in it for SAP when the mobile products in the pipeline finally get to market, it should provide them with an extra push in the spring.”
• Grain, Soybeans Rise as Food Riots Spur Demand for U.S. Exports. Wheat rose, heading for the longest rally since November 2009, while corn and soybeans climbed as countries increase shipments from the U.S., the world’s biggest exporter, to cut food inflation and quell civil unrest. Food-exporting countries are “strongly advised” not to restrict shipments to prevent “more uncertainty and disruption” in world markets, the United Nations said. Governments in Egypt, Algeria, Morocco and Yemen have faced protests amid rising costs and high unemployment, and a revolt toppled Tunisia’s leader. “Sovereign nations are beginning to stockpile food to prevent unrest, and that will help to boost demand for U.S. grains,” said Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana. “You artificially stimulate much higher demand when nations start to increase stockpiles.” Wheat futures for March delivery rose 20.25 cents, or 2.4 percent, to $8.585 a bushel at 11:23 a.m. on the Chicago Board of Trade, heading for a seventh straight advance. Earlier, the price reached $8.595, the highest level for a most-active contract since Aug. 6. Before today, the grain jumped 68 percent in the past 12 months. Corn futures for March delivery climbed 13.25 cents, or 2.1 percent, to $6.5725 a bushel. Before today, the price surged 75 percent in the past 12 months. Soybean futures for March delivery advanced 13,25 cents, or 1 percent, to $13.8775 a bushel. Before today, the oilseed gained 46 percent in the past year.
  
• Hogs Rally to 14-Year High as Pork Demand May Rise; Cattle Gain. Hogs climbed to the highest price in more than 14 years on improving prospects for U.S. pork exports to Asia. Cattle also advanced. Hog futures for April settlement rose 1.75 cents, or 2 percent, to 88.875 cents a pound at 10:01 a.m. on the Chicago Mercantile Exchange. Earlier, prices reached 88.925 cents, the highest for a most-active contract since May 1996.
• CFTC Proposes Fund-Adviser Reporting Requirements. The Commodity Futures Trading Commission proposed requiring U.S. commodity funds and trading advisers with at least $1 billion in assets to report quarterly on use of leverage, counterparty risk and trading positions to give regulators information on financial-system threats. CFTC commissioners voted 5-0 today to seek comment on the measure drafted jointly with the Securities and Exchange Commission, which released a proposal yesterday. The measure, part of the agencies’ rulemaking under the Dodd-Frank Act, applies to hedge-fund advisers, commodity pool operators and commodity trading advisers registered with both agencies.
• Deep-Water Oil Drilling Stalemate Pits Explorers Against U.S. Regulators. The U.S. Interior Department is refusing to issue deep- water exploration permits because energy companies haven’t shown they have “access to and can deploy containment resources” to deal with out-of-control wells on the sea floor, Melissa Schwartz, an agency spokeswoman, said yesterday. No exploration well has been drilled in U.S. waters deeper than 500 feet (152 meters) since BP’s Macondo well erupted in April.
• German Import-Price Inflation Accelerates to Fastest in More Than 29 Years. German import prices rose at the fastest annual pace in more than 29 years in December, driven by soaring costs for commodities such as energy and metal. Import-price inflation accelerated to 12 percent, the highest rate since October 1981, from 10 percent in November, the Federal Statistics Office in Wiesbaden said in an e-mailed statement today. Economists predicted the rate would rise to 10.8 percent, according to the median of 12 estimates in a Bloomberg News survey. In the month, prices increased 2.3 percent, almost double the 1.2 percent forecast by economists.
• Soros, Volcker to Invest in Post-Crisis Economic Research Group. Billionaire investor George Soros said he and former Federal Reserve Chairman Paul Volcker are investing in a new research effort aimed at developing economic ideas following the financial crisis. The plan is for the Centre for International Governance Innovation and Institute for New Economic Thinking to unite, Soros told reporters at the World Economic Forum’s annual meeting in Davos, Switzerland.
• U.S. Households Poised to Increase Stock Holdings: Chart of the Day. Individual investors are just beginning to move into stocks after being burned in the bond market, according to Bankim Chadha, Deutsche Bank AG’s chief U.S. equity strategist. This shift has the potential to become “an important positive for equities,” Chadha wrote yesterday in an e-mail. Households are likely to end up with a greater percentage of their investments in stocks, in his view.
• Russia Plans Sovereign Fund to Lure Foreign Cash. President Dmitry Medvedev said Russia plans to create a “special sovereign fund” to attract foreign capital as he tries to shift investors’ attention from a deadly terrorist attack on Moscow’s busiest airport this week. “It may make sense now to think about creating a special sovereign fund that comprises state property and money to attract an array of private investments from abroad and within the country,” Medvedev said in an interview with Bloomberg Television today at the World Economic Forum in Davos, Switzerland.
• Shoppers Buy Quality at Lululemon(LULU), Victoria's Secret. Product is king again. After using discounts and promotions to deliver the best holiday sales performance in six years, U.S. retailers will need unique merchandise to keep the momentum going. “It’s got to be all about the product,” said Christine Chen, a Needham & Co. analyst based in San Francisco. Discounts alone are not enough to keep consumers shopping, she said. Abercrombie & Fitch Co.(ANF), Lululemon Athletica Inc. and Urban Outfitters Inc.(URBN) are already winning shoppers with quality, fashion and merchandise that can’t be found elsewhere, Chen said.
• Egypt Bans Protests After Tunisia-Inspired Rallies. Egyptian authorities banned protests and tightened security after thousands of people took to the streets of Cairo and major cities yesterday to denounce President Hosni Mubarak, inspired by the revolt that toppled Tunisia’s leader. Truckloads of riot police were deployed today in central Cairo to prevent a repeat of the demonstrations, in which at least three people were killed, sending Egypt’s benchmark EGX30 index tumbling the most since May.
• Petrobras(PBR) CEO Says Could Double Output Earlier Than Forecast. Petroleo Brasileiro SA Chief Executive Officer Jose Sergio Gabrielli said the company could double oil output earlier than its current target of 2020.
• Trichet Signals EU's Bailout Fund Could Buy Bonds to Ease Pressure on ECB. European Central Bank President Jean-Claude Trichet said governments could empower the region’s bailout fund to buy bonds, a step that would take pressure off the ECB’s efforts to fight the sovereign-debt crisis. “There are a number of tools they can use and I would certainly not exclude that one, which I would consider useful in certain circumstances,” Trichet said in an interview with Bloomberg Television in Davos, Switzerland today.

Wall Street Journal:

• Lenovo Chaiman Sees More Chinese Investment in U.S. The chairman of China's Lenovo Group Ltd. predicted increased investment in the U.S. from China's companies and its sovereign wealth fund as they seek opportunities in the world's largest economy despite its recent troubles. The prospects for additional Chinese investment were discussed at a meeting last week between Chinese business leaders and President Barack Obama during Chinese President Hu Jintao's visit to the U.S., said Liu Chuanzhi, in an interview at the World Economic Forum at Davos. In particular, he says that Mr. Obama and the head of China's Investment Corp., the country's $300 billion sovereign wealth fund, talked about the Chinese investing in infrastructure projects in the U.S.
• China Banking Regulator: "Very Concerned" About Inflation. China's top banking regulator said Wednesday the country's authorities are "very concerned" about inflation and are determined to refrain from seeking overly fast economic growth in the future. Attending the annual World Economic Forum, Liu Mingkang, chairman of the China Banking Regulatory Commission, also expressed a surprisingly blunt and critical view of the recent launch of the country's first credit derivatives, by an association backed by the Chinese central bank. He urged banks not to rush into rolling out such risky products. For new emerging markets, we are all facing inflationary pressure partly due to capital inflows," said Liu, when speaking at the forum. Liu said inflation is becoming a "worldwide" phenomenon, expressing concerns that "while inflation is coming up in Europe and the U.S., QE II is also coming up," referring to the Federal Reserve's quantitative easing program to pump liquidity into the financial system to boost economic growth. He added that China is making efforts to push forward structural reforms to make its economy "lighter and greener." "This year we'll say goodbye to double-digit GDP growth," he said.

Bloomberg Businessweek:

• Dollar, Stock Correlation Break Indicates Recovery: Chart of the Day.

Fox News:

• Exclusive: 'Skins' 'In Danger of Being Canceled,' Source Says. MTV’s controversial drama “Skins” is losing advertisers faster than some of its characters lose their clothes. As FOX411 reported, Taco Bell was the first sponsor to withdraw advertising from "Skins," quickly followed by Wrigley, Subway, Foot Locker, L’Oreal and Shick. General Motors and H&R Block both issued statements explaining that their ads were aired during the premiere by mistake and would have no further association with the show. Lacking a stable of advertisers to sponsor the show, “Skins” could reportedly lose MTV up to $2 million per episode. With the swift decampment of sponsors, FOX411 has learned that the show may soon be off the air—for good.

CNBC:

• New and Improved Credit Default Swaps Page.

Business Insider:

• The CBO Reveals 10 Cringeworthy Facts About U.S. Government Spending.

MarketWatch.com:

• Demand Media, Nielsen Shares Jump in IPOs. Demand Media Inc. and Nielsen Holdings on Wednesday kicked off the IPO season with big share gains, after each priced above their initial targets. Demand Media(DMD 23.26, +6.26, +36.82%) shares jumped nearly 40% to $23.47 as the company began trading on the New York Stock Exchange. Meanwhile, shares of Nielsen Holdings(NLSN 25.60, +2.60, +11.30%) rose more than 9% to $25.10 as the company began trading on the New York Stock Exchange.

New York Times:

• A Region's Unrest Scrambles U.S. Foreign Policy. As the Obama administration confronts the spectacle of angry protesters and baton-wielding riot police officers from Tunisia to Egypt to Lebanon, it is groping for a plan to deal with an always-vexing region that is now suddenly spinning in dangerous directions.

Forbes:

• Davos: George Soros Answers Questions. SOROS ON WHETHER HE’S DECLARING A WAR ON CAPITALISM: I have my thoughts but those are not INET’s thoughts. I have been target of character assassination of right wing, I disapprove of the methods but I understand as am opposed exactly to their methods so I am in that controversial position.”

Reuters:

• U.S. Airline Results Buoyed by Recovery. US Airways Group (LCC.N) and United Continental Holdings (UAL.N) topped Wall Street earnings estimates on Wednesday and said current revenue trends were solid, sending their shares higher and signaling that the airline industry recovery is on track.

beaumontenterprise.com:

• Accused Fort Hood Shooter Ruled Sane; Faces Capital Trial. An Army psychiatrist charged with killing 13 people and wounding dozens more in a Fort Hood shooting spree has been ruled sane by a panel charged with deciding his fitness to face trial. The action by the Army's “sanity board,” as the panel is called, is a key step in prosecutors' efforts to try Maj. Nidal Malik Hasan on capital murder charges here. It clears the way for military authorities to call a trial.

Telegraph:

• Apple's(AAPL) iPhone and iPad to Push App Sales Beyond $15 Billion in 2011.

Sueddeutsche Zeitung:

• Germany would be endangered by an expansion of the European bailout fund, Hans-Werner Sinn, the president of the Munich-based Ifo institute, told Sueddeutsche Zeitung.

Good Friends:

• Rice prices in North Korea's capital Pyongyuang and other major cities rose more than 50% from early this month because some supplies were taken by military and it weak local currency made imports expensive, Good Friends, a Seoul-based rights group that says it has sources in the communist country, reported on its website.

China National Radio:

• China's State Council set the minimum down payment for second home purchases at 60%, citing a meeting of the government body.
  
• China's State Council set interest rates for second home mortgages at no less than 110% of benchmark rates, citing a meeting of the top government body. Sellers of homes within five years of purchase will be responsible for paying full transaction taxes.