- Europe Urged to Fix Crisis, G-20 Warns of Stress. Europe’s governments were told the onus for fixing their debt woes still lies with them as the Group of 20 warned the two-year crisis still threatens global growth. With finance chiefs from the G-20 meeting today in Washington, those from Canada and Australia joined the IMF and U.S. in pressing Europe to intensify efforts to quell the turmoil as it spreads to Spain. The G-20 cited “the situation in Europe” first in a list of drags on the world economy, according to a draft statement obtained by Bloomberg News. As she welcomed pledges of about $320 billion for the IMF’s crisis-fighting coffers, IMF Managing Director Christine Lagarde said the lender serves as an emergency backstop and that Europe must protect itself, boost economic growth and cut debt. Italian and Spanish bonds fell yesterday on speculation the crisis is worsening. “Countries have to take measures,” Lagarde told Bloomberg Television’s “InBusiness With Margaret Brennan” in Washington. “I am in charge of improving the stability and I need to have the umbrella in case the clouds break into a nasty rain.”
- Hog farmers in China face the slimmest profit margins since 2010, which could cut meat supplies and demand for animal feed in the world's largest pork-consuming nation. The hog-to-corn price ratio for Chinese farmers measures profitability. The measure was 6.22 times at April 4, a level not seen since September 2010, according to data compiled by Beijing Shennong Kexin Agribusiness Consulting Co. The ratio was 8.53 times in July 2011. The official break-even point is 6 times, below which the government may pay subsidies to producers.
- Bank of America(BAC) Leads Banks in Short Sales of U.S. Homes. Bank of America Corp., the U.S. lender with the most housing-related writedowns, is allowing the highest number of properties to be sold at a loss as short sales become an increasingly common foreclosure alternative. The Charlotte, North Carolina-based bank approved 5,276 short sales in January, topping JPMorgan Chase & Co. (JPM), with 2,976, and Wells Fargo & Co. (WFC), the biggest home-loan originator, with 2,788, according to a report today by RealtyTrac Inc. The total number of U.S. short sales, in which properties are bought for less than what’s owed on them, rose 33 percent from a year earlier in January, the latest month for which figures are available, and is expected to set a record this year, the Irvine, California-based data provider said.
- Coming Soon to Your Desktop at Work: Ads. There has long been a divide between business and consumer software: Companies mostly buy licenses to use applications, while consumers often pay nothing and advertisers shell out money to reach them. Several startups have begun tearing down that divide by offering ad-supported business software.
- Fed Gives Banks Until July 2014 to Comply With Volcker Rule. Wall Street banks will have two years to implement the so-called Volcker rule so long as they make a "good faith" effort to comply with the ban on proprietary trading, U.S. regulators said. Banks will get the "full two-year period" provided by the Dodd-Frank financial overhaul law to "conform" their activities and investments, the Federal Reserve and four other U.S. agencies said in a statement today. The Fed has the authority to extend the period of compliance beyond July 21, 2014, the regulators said.
- China Vice Finance Minister: No Decision Yet On Increasing IMF Contributions.
- Judge Orders Liquidation of a Fletcher Hedge Fund. A judge in the Cayman Islands ordered the liquidation of a hedge fund run by Fletcher Asset Management after three Louisiana public pension funds told the court they weren't able to withdraw their money from the fund.
- NY Fed: New Dollar Swap Borrowings Total $1.276B In Latest Wk.
- Drone Use Takes Off on the Home Front. With little public attention, dozens of universities and law-enforcement agencies have been given approval by federal aviation regulators to use unmanned aircraft known as drones, according to documents obtained via Freedom of Information Act requests by an advocacy group.
- Vulture Investor Battles for Death-Bet Payouts. Fortress Investment Group, a self-described "garbage collector" of distressed assets, thought it had uncovered another winning junk pile when the market for repurchased life-insurance policies crashed.
- Noonan: America's Crisis of Character. The nation seems to be on the wrong track, and not just economically.
- The Idiot's Guide To This Weekend's French Election.
- 10 Faces Behind The Incredible Law School Underemployment Crisis.
- Sean Egan: No Basis for SEC to Accuse Ratings Firm. Sean Egan told CNBC Thursday the Securities and Exchange Commission had no reason to charge his credit-rating firm with intentional misstatements when it applied to be a "nationally recognized'' rating agency.
- Goldman(GS) Employee Investigated for Insider Trading. A new insider trading investigation is underway involving a current employee of Goldman Sachs —an investigation that could complicate the prosecution of former Goldman board member Rajat Gupta.
- Fears Rise That Recovery May Falter in the Spring. Some of the same spoilers that interrupted the recovery in 2010 and 2011 have emerged again, raising fears that the winter’s economic strength might dissipate in the spring. In recent weeks, European bond yields have started climbing. In the United States and elsewhere, high oil prices have sapped spending power. American employers remain skittish about hiring new workers, and new claims for unemployment insurance have risen. And stocks have declined. There is a “light recovery blowing in a spring wind” with “dark clouds on the horizon,” Christine Lagarde, managing director of the International Monetary Fund, said Thursday, at the start of meetings here that will focus on Europe’s troubles and global growth.
- Election 2012: Romney 48%, Obama 43%. (graph)
- High-frequency trader Optiver pays $14 mln in oil manipulation case. U.S. regulators claimed their first victory in a four-year old effort to crack down on oil market manipulation on Thursday, announcing a $14 million settlement with high-frequency trading firm Optiver.
- SanDisk(SNDK) Sees Pricing Pressure Hurting 2nd Qtr. SanDisk Corp said the glut in the memory chips market will continue to hurt prices for the rest of the year, sounding its second revenue warning in as many quarters. SanDisk shares fell 9 percent to $36.90 in extended trading.
- Product Upgrade Delays to Continue to Hurt Riverbed(RVBD). Riverbed Technologies Inc reported lower-than-expected first-quarter revenue, and forecast second quarter below estimates as the network gear maker expects delays in product upgrades to continue to hurt revenue. Shares of the company slumped 17 percent in aftermarket trading.
- BRICS Demand Bigger IMF Role Before Giving It Cash. The International Monetary Fund's bid to win a big boost in funding to handle the euro-zone debt crisis hit a speed bump on Thursday when Brazil demanded more power at the IMF for emerging economies as a condition for lending it extra cash.
- Chipotle(CMG) Profit Beats on Traffic, Price Increases. Chipotle Mexican Grill Inc reported quarterly profit that beat Wall Street forecasts as sales at established restaurants topped analysts' views, helped by more customer visits and last year's menu price increases.
- Tempur-Pedic(TPX) forecast disappoints, shares dip. Tempur-Pedic International Inc forecast full-year results that came in below Wall Street estimates, and bucked the usual trend of raising its outlook, sending the mattress-maker's shares down by as much as 11 percent after the bell.
- Altera(ALTR) Posts Week 1st-Qtr, Sees Higher Revenue in 2Q. Programmable chipmaker Altera posted lower-than-expected quarterly results as demand for its wireless and telecom products fell, but forecast higher revenue in the second quarter.
- Microsoft(MSFT) Beats Street Profit View, Shares Up. Microsoft Corp beat Wall Street's profit forecast as personal computer sales held up better than expected, lifting its shares 2.5 percent after hours.
- High Rates Give Brazil Growing Pains. In Brazil, the signs in shopping centres urge customers to buy everything from watches to fridges in instalments sem juros, or without interest.
- Bo Xilai 'responsible for two more deaths'. In a bid to quash an investigation into his wife for the murder of Neil Heywood, Bo Xilai had at least seven people seized and tortured two to death, according to a document read out to Chinese government officials.
- It's Not Just Christine Lagarde Who Is On Crutches. There always seems to be some kind of accoutrement on hand when Christine Lagarde, the International Monetary Fund's managing director, makes her public appearances. In Davos this year, she'd brought her "little bag" to collect money for eurozone bailouts. For this week's spring meeting of the IMF in Washington DC, she's brought a crutch. This time it's not deliberate. She's recently undergone a knee operation. Yet it seems no less appropriate. The world economy is on crutches too.
- German Tempers Boil Over Back-Door Euro Rescues. Controversy is raging in Germany over soaring "payments" by the Bundesbank to shore up Europe's monetary system and cope with a tidal wave of capital flight from southern Europe. Professor Hans-Werner Sinn, head of Germany's IFO Institute, said German taxpayers are facing a dangerous rise in credit risk from a plethora of bail-out schemes. "The euro-system is near explosion," he told Austria's Economics Academy on Thursday. Dr Sinn said Germany is on the hook for much of the €2.1 trillion (£1.72 trillion) in rescue measures for EMU debtors - often by the back-door - that will saddle Germans with ruinous losses one day. "It is a horror scenario," he said, warning that the euro system is splitting friendly countries into blocs of mutually hostile creditors and debtors, exactly the opposite of what was hoped. Earlier this week, the Foundation for Family Business in Munich filed a criminal lawsuit against the Bundesbank, accusing the board of disguising the true scale of risk born by German citizens. The furore follows a sharp jump in the Bundesbank's "Target2" claims within the European Central Bank's internal payment network from €547bn in February to €616bn in March. Bundesbank claims have risen sixfold since 2008, a rise mirrored in Holland and Luxembourg.
- Foreigners bought 293 units vs. 1,358 homes in 4Q 2011, according to analysis by property consultant Dennis Wee Group. Sales to foreigners fell after the government's move in Dec. to impose higher taxes on home purchases. Purchases by permanent residents fell 7.5% to 790 units.
- DE Shaw Reviews India Investment On Dwindling PE Activity & Tax Woes; Lays Off Employees. The DE Shaw group, one of the world's largest hedge funds, is reviewing its India play. The fund, which launched its private equity business in the country in 2006, has exited about 60% of its investments in Indian companies. It has also put plans to launch an India-dedicated fund on the backburner, and has laid off some employees from its local unit amid dwindling private equity deal activity and tax woes impacting the fund-raising climate.
- None of note
- Asian equity indices are -1.0% to unch. on average.
- Asia Ex-Japan Investment Grade CDS Index 167.50 +1.0 basis point.
- Asia Pacific Sovereign CDS Index 133.25 -.75 basis point.
- FTSE-100 futures -.13%.
- S&P 500 futures +.10%.
- NASDAQ 100 futures +.12%.
Earnings of Note
- None of note
- None of note
Other Potential Market Movers
- The G20 Finance Ministers Meeting and the IMF Meeting could also impact trading today.