Today's Headlines

Bloomberg:

• Euro-Area Manufacturing Production Contracts. Europe’s manufacturing industry contracted for a third month in October, adding to signs the euro-area economy is edging toward a recession. A manufacturing gauge based on a survey of purchasing managers in the 17-nation euro region fell to 47.1 from 48.5 in September, London-based Markit Economics said today. That’s below an initial estimate of 47.3 published on Oct. 24. A reading below 50 indicates contraction. Europe’s economy is showing signs of a deepening slump as its worsening debt crisis erodes the confidence of consumers and executives alike. The Organization for Economic Cooperation and Development on Oct. 31 lowered its euro-region growth projections for this year and next and called on the European Central Bank to lower its benchmark interest rate at its meeting tomorrow.
• EFSF Delays 3 Billion-Euro Bond Sale on Market Volatility. Europe’s bailout fund is delaying a 3 billion-euro ($4.1 billion) bond sale after Greek Prime Minister George Papandreou’s request for a referendum on the rescue pact for his country roiled markets. The European Financial Stability Facility is putting off the 10-year issue “due to market conditions,” according to Luxembourg-based spokesman Christof Roche. The fund may wait for the outcome of the Nov. 3-4 Group of 20 summit in Cannes, France before selling the bonds, according to a person with knowledge of the matter. “The developments around the G-20 in Cannes will have a big impact on the pricing of any issue,” said Christophe Herpet, a Paris-based fund manager at AXA Investment Managers, which oversees about $735 billion of assets. Credit markets whipsawed after Papandreou surprised European leaders with his referendum plan. A benchmark credit- default swaps index soared the most ever yesterday as investors sought to protect their investments.
• EU Bank Recapitalization Plan Has 'Problems': IIF. The European Union’s plan for recapitalizing banks has “serious problems” that will hurt economic growth and make it harder for some nations to borrow, the Institute of International Finance said. There is a “clear need” to restore confidence in Europe’s banks, IIF Managing Director Charles Dallara said today in a letter to the Group of 20 nations on the eve of a summit in Cannes, France. Yet the extra capital requirements at the center of the EU’s strategy will come with “considerable cost” because of a flawed scope and approach, he said.
• German Unemployment Rose First Time in Two Years in October. German unemployment unexpectedly rose for the first time in more than two years in October and manufacturing contracted as pessimism mounted among businesses in Europe’s largest economy. The number of people out of work rose a seasonally adjusted 10,000 to 2.94 million, the Nuremberg-based Federal Labor Agency said today. Economists forecast a decline of 10,000, the median of 31 estimates in a Bloomberg News survey showed. The adjusted jobless rate rose to 7 percent from 6.9 percent.
• European Banks May Need $550 Billion Capital Boost, Neptune Says. Europe’s banks may need to boost capital by as much as 400 billion euros ($550 billion) to provide an adequate cushion against losses on government bonds, four times the increase estimated by the industry, according to Neptune Investment Management Ltd.
  
• Fed Sees 'Downside Risks'; Leaves Policy Unchanged. Federal Reserve policy makers said the economy has picked up while “significant downside risks” remain, and they refrained from taking any additional steps to ease monetary policy. “Economic growth strengthened somewhat in the third quarter, reflecting in part a reversal of the temporary factors that had weighed on growth earlier in the year,” the Federal Open Market Committee said today in Washington after a two-day meeting. At the same time, it repeated that “there are significant downside risks to the economic outlook, including strains in global financial markets.” The statement may reflect the desire of policy makers led by Chairman Ben S. Bernanke to see if the unconventional policy steps unveiled at their last two meetings help the expansion gain strength before embarking on new initiatives.
• U.S. Companies Add More-Than-Expected 110,000 Workers in October, ADP Says. Companies added workers in October, easing concern the job market is stagnating in the third year of the U.S. recovery, according to a private report based on payrolls. The 110,000 increased followed a revised 116,000 gain the prior month, Roseland, New Jersey-based ADP Employer Services said today. The median forecast of economists surveyed by Bloomberg News called for a advance of 100,000.
• Confidence Among CEOs in U.S. Declines to Lowest in a Year, Survey Shows. Confidence among U.S. chief executive officers declined in the third quarter to the lowest level in more than a year as their outlook for the world’s largest economy weakened, a private survey showed. The Young Presidents’ Organization index of sentiment from July through September fell to 57.7, the weakest since the second quarter 2010, from 61.1 in the prior three months, according to the Dallas-based group. Readings greater than 50 show the outlook was more positive than negative in the survey, which began in July 2009. Thirty percent of the executives said they expected the economy would improve in the next six months, down from 45 percent who gave that response three months ago. Some 25 percent projected the economic outlook will deteriorate, more than double the 12 percent in the prior survey.
• French Magazine Firebombed After Arab Spring Satire, AFP Reports. The offices of Charlie Hebdo, a French satirical magazine that published a special edition featuring the prophet Mohammed as a “guest editor,” were gutted in an overnight firebomb attack, Agence France-Presse reported, citing an unidentified police official. Charlie Hebdo published a special edition today to commemorate the recent Arab Spring uprisings, including a cartoon image of the prophet on the cover. The fire started about 1 a.m. and caused no injuries, the news service reported., Patrick Pelloux, a witness at the scene, told AFP that a Molotov cocktail was thrown through a window and set fire to the computer system.
• MasterCard(MA) Surges as Profit Rises 38%. MasterCard Inc. (MA), the world’s second- biggest payments network, climbed the most since August as an increase in card spending helped the firm’s third-quarter profit beat estimates. The stock gained $24.95, or 7.5 percent, to $359.25 at 11:40 a.m. in New York trading. Net income climbed 38 percent to $717 million, or $5.63 a share, from $518 million, or $3.94, a year earlier, the firm said today in a statement. The average estimate of 29 analysts surveyed by Bloomberg was $4.82.
• Municipal-Bond Tax-Exemption Faces 'Real Threat' From Congress, Kraft Says. The tax-exemption on interest paid by state and local bonds faces a “real threat” from the congressional supercommittee charged with shrinking the U.S. deficit, said John L. Kraft, a municipal-bond attorney. The exemption will be a target for the panel as it seeks to find $1.5 trillion of spending cuts or revenue increases over 10 years, said Kraft, a partner with Lomurro, Davison, Eastman & Munoz Inc. in Freehold, New Jersey. “Tax exemption is not a tax preference for the rich but an opportunity for states to carry out their capital projects in the most cost-effective way,” Kraft said today at the State and Municipal Finance Conference hosted by Bloomberg Link in New York. “Do away with the exemption and you’re imposing on the citizens a tremendous cost.”

Wall Street Journal:

• Riding Dakota Oil Boom. A surge in crude-oil production in North Dakota is fueling a railroad boom in one of the nation's most remote regions, as producers bet that trains will be a quick and lucrative way to break a transportation bottleneck. The steady conveyor belt of jet-black rail cars is just the latest change in this state's western corner. Already clusters of trailers, known as man camps, have popped up in pasture lands outside of small towns like Watford City, N.D., to house oil workers.
• Greece Under Pressure To Hold Referendum As Soon As Possible. Greece is under intense pressure to call a controversial referendum on its bailout package as soon as possible and possible dates include Dec. 4 and Dec. 11, senior G-20 and International Monetary Fund Officials said Wednesday. "Original thoughts that the vote will be held in January are out of the question," an IMF official told Dow Jones Newswires.
• The Bush-Obama Rx Shortages. Critical cancer drugs are in short supply thanks to price controls.
  

CNBC.com:

• BofA(BAC) Employees Flood Bank's Rivals With Resumes.

Business Insider:

• The Oakland Strike Is Getting Huge and Has Already Slowed Down The Nation's Fifth Biggest Port.
• You'll Never Guess What Jon Corzine Did The Night Before MF Global's Disastrous Earnings.
• Europe Is Not a Nation, Therefore the Euro is Doomed.
• China's 'The World' Is The Most Ridiculous Housing Project We've Ever Seen.
• French Yields Just Exploded. (graph)
  

Zero Hedge:

• Fed Slashes Economic Outlook, Raises Inflation and Unemployment Rate Projection.
• The First-Loss Insurance Providing EFSF Is A Truly Unique Vehicle.
  

Rasmussen Reports:

• Obama Full-Month Approval Index in October Dips To Lowest Level Yet. In October, 20% of voters Strongly Approved of the president’s job performance. That’s the lowest level found during the Obama presidency to date and the second time in the last three months that the finding has fallen to a record low. Prior to last month, the number who Strongly Approved of the president’s performance ranged from a low of 21% to a high of 31% since July 2009. By comparison, 43% Strongly Approved of Obama's performance when he assumed office in January 2009.

Reuters:

• Europe Might Force Greek Deal on Creditors - Source. Europe is increasingly likely to force investors to take a cut on their Greek bondholdings if they do not voluntarily sign up to a deal to slash the country's debt burden, a person briefed on the negotiations said on Wednesday. The deal is part of an ambitious plan that was thrown into doubt this week when Greece said in a shock announcement it would vet the three-pronged agreement through a plebiscite.
  
• Foster Wheeler(FWLT) Profit Slips, Shares Drop 9%.
  
• World Manufacturing Stagnates in Oct - PMI. The world's manufacturing economy stagnated in October with the crisis-wracked euro zone by far the worst performing region, according to a business survey that showed new export orders declining at the fastest pace in almost two-and-a-half years.

Telegraph:

• Debt Crisis: Live. IMF warns it could hold back bail-out cash without assurances that Greece will fulfil its commitments, but Papandreou is 'unable to give that', while EC President urges Greece to back eurozone package.

Die Welt:

• European Union Energy Commissioner Guenther Oettinger said Greek Prime Minister George Papandreou's push for a referendum on a new bailout package for the over-indebted country is putting the euro "in even greater danger." The consequences of a Greek rejection would be incalculable and the situation has worsened significantly for euro countries that don't enjoy the highest credit rating, Oettinger said today.

Handelszeitung:

• Georg Fischer AG is not growing as strongly as in the first half of the year, CEO Yves Serra said. A slowdown in growth in China, where the Swiss company gets about one-seventh of its sales, is occurring, he said. The company's China growth will be about half of last year's 20% to 25% rate.

Delo:

• Slovenian banks' bad loans have more than doubled from a year ago to 6.8% of all outstanding loans, citing the Slovenian central bank. A creation of a so-called bank bank is only one of the options to deal with difficulties in the banking system, the central bank said.

Shanghai Daily:

• Shanghai Sees Luxury Home Sales Decline. SALES of luxury houses in Shanghai fell in the first 10 months of this year, with extremely sluggish transactions in September and October, according to a research released yesterday by Century 21 China Real Estate. Between January and October, 1,231 units, or 299,800 square meters, of new residential properties priced at more than 50,000 yuan (US$7,899) per square meter were sold across the city, an annual decline of 22.6 percent and 18.5 percent respectively, said the agency, which operates a local network of more than 300 branches. In September and October, a traditional high season for home sales, only 195 units of luxury homes were traded, a plunge of nearly 65 percent from the same months a year earlier. These homes were sold at an average 71,300 yuan per square meter during the 10 months, up an annual 5.8 percent, Century 21 data showed.