Bloomberg:
- ECB to Give First Indication of Three-Year Loan Repayment Today. The European Central Bank will give a first indication today of how much of its 1 trillion euros ($1.33 trillion) in three-year loans banks plan to repay early. In a statement at around noon in Frankfurt, the ECB will say how much of the first three-year loan banks have pledged to hand back at the first early-repayment opportunity on Jan. 30. They will initially repay 84 billion euros, according to the median of 10 estimates in a Bloomberg News survey of economists. Some 150 billion euros of the first loan, which totaled 489 billion euros, will be given back early as banks continue to repay the funds over coming weeks, the survey shows.
- Monti Says Monte Paschi Bailout Hinges on Bank of Italy Review. Banca Monte dei Paschi di Siena SpA’s 3.9 billion-euro ($5.2 billion) government bailout may face a delay after Prime Minister Mario Monti called for a further review of the bank’s accounts. Monti said the Bank of Italy will take another look at the bank’s books after the company disclosed this week it may face more than 700 million euros of losses related to structured finance transactions hidden from regulators. Monte Paschi (BMPS) shareholders are voting on a capital increase today to pave the way for the emergency government loans.
- EU to Embark on Strong Bank-Structure Overhaul, Barnier Says. Michel Barnier, the European Union’s financial services chief, said that he will present proposals this year for a “strong reform” of bank structure in a bid to prevent lenders from being too-big-to-fail. The EU plans will “separate well the risks in the banking sector,” the European Commissioner said in an interview with Bloomberg Television’s Caroline Connan yesterday at the World Economic Forum in Davos, Switzerland. The proposals may be published by September, he said.
- China's New Leaders May Introduce Property Curbs, BofA Cui Says. China's new government may introduce new curbs on the property market when it takes power in March, hurting the outlook for the nation's equities, according to David Cui, equity strategist at Bank of America Corp. The "potential negative triggers" for stocks are policies to restrain the rebound in real-estate prices and so-called shadow banking, Cui said. "The sensitive period I would watch out for is after the National People's Congress in early March when the new leaders are installed," he said. "There may be a change in policy."
- China’s Stocks Fall to One-Week Low as Liquor Makers Decline. Chinese stocks fell to a one-week low as declines by consumer-staple and financial shares overshadowed advances among health-care companies. Kweichow Moutai Co. (600519) slumped 2.8 percent, leading a gauge of consumer-staple companies to a one-month low. Financial shares were the biggest drag on the CSI 300 Index after valuations climbed to a 10-month high. Goertek Inc., an Apple Inc. supplier, dropped to a five-week low after the U.S. company’s shares slumped on earnings.
- Billionaire Kotak Says Bad Debts Are No. 1 Threat to India Banks. Billionaire Uday Kotak, the controlling shareholder of the Indian bank with the highest lending margins, said the nation’s increasing sour debts pose the biggest threat to its lenders. “The No. 1 focus and concern for the system, the banking system, is rising bad loans,” Kotak, 53, said yesterday in an interview with Bloomberg Television from the Swiss city of Davos while attending the World Economic Forum. “A lot of large corporates have got themselves over-leveraged, and that’s where the pain is.”
- Billionaire Icahn Says No Respect for Ackman Herbalife(HLF) Bet. Billionaire investor Carl Icahn, saying he doesn’t “like” or “respect” fellow hedge-fund manager William Ackman, criticized the way Ackman publicized a bet that shares of Herbalife Ltd. would decline. “You don’t go out and get a room full of people to badmouth the company,” Icahn said today in an interview with Trish Regan on Bloomberg Television’s “Street Smart.” “If you want to be in that business, why don’t you join the SEC,” Icahn added, referring to the U.S. Securities and Exchange Commission.
- Singapore’s Biggest Deals Hit by Property Curbs: Southeast Asia. Singapore’s latest round of measures to curb record property prices has become a stumbling block in the city-state’s two-biggest corporate takeover deals.
- Japan CPI Fall Shows Challenge For Central Bank Price Target. Japan’s consumer prices declined for the seventh time in eight months, highlighting the challenge facing the Bank of Japan (8301) to reach a 2 percent inflation target announced this week. Consumer prices excluding fresh food fell 0.2 percent in December from a year earlier, the statistics bureau said in Tokyo today, matching the median estimate of 23 economists surveyed by Bloomberg News.
- Apple(AAPL) Expands Audits, Says China Labor Agent Forged Documents. Apple Inc. (AAPL) expanded internal audits of suppliers and identified a Chinese labor agent hiring underage workers as the world’s most-valuable company moves to boost conditions for people making iPhones and iPads. One manufacturer employed 74 children younger than 16, and 158 facilities lacked procedures or didn’t perform adequate audits of their own suppliers, according to the annual Supplier Responsibility Report released today by Cupertino, California- based Apple.
- SEC Nominee Signals Shift. Obama Taps Ex-Prosecutor Mary Jo White, Portending Increased Policing of Wall Street. President Barack Obama nominated a former prosecutor turned white-collar criminal defender as his choice for top U.S. securities regulator. The nomination of Mary Jo White marks the first time a former prosecutor has been chosen to lead the Securities and Exchange Commission in its 79-year history. The move could signal tougher policing of Wall Street.
- Pensions Bet Big With Private Equity. On the 13th floor of a sleek downtown office building here, the trading desks are manned overnight. The chief investment officer favors cowboy boots made of elephant skin. And when a bet pays off, even the secretaries can be entitled to bonuses. The office's occupant isn't a highflying hedge fund but the Teacher Retirement System of Texas, a public pension fund with 1.3 million members including schoolteachers, bus drivers and cafeteria workers across the state.
- Pyongyang Plans Nuclear Detonation. North Korea made its most explicit statement yet that it plans to detonate another nuclear device—its third—in the near future, in what it said was "a new phase of the anti-U.S. struggle." The National Defense Commission, a body of generals considered the most powerful part of North Korea's authoritarian regime, said the country would launch "a variety of satellites and long-range rockets…one after another" and carry out "a nuclear test of higher level."
- The Fight to Unseat Apple's(AAPL) iPhone Intensifies. The iPhone ended the year with a blowout quarter in the U.S. market. But underneath the big numbers at the largest U.S. carriers are signs Apple Inc. faces a rapidly changing marketplace that could erode its dominance.
- Citi(C) Adds to Drain of Funds at SAC. Multiple Relationships With Hedge-Fund Firm Are at Stake in Company's Decision to Redeem $187 Million.
- Cyprus Bailout Rifts Rekindle Broader Fears. A flap over a potential bailout for Cyprus is heightening anxieties that the tiny island's economy could become the next flash point in the euro zone's debt crisis. A rescue program for Cyprus will require substantially reducing government and bank debt, Olli Rehn, the European Union's economics commissioner, said in an interview Thursday at the World Economic Forum in Davos, Switzerland, in a recognition that a more-conventional bailout of the latest euro-zone country to hit financial difficulties would leave it with too much debt.
- 'Disaster Bonds' Miss Their Mark. In December, an Iowa state agency issued $1.2 billion in municipal bonds for an Egyptian company to build a fertilizer factory. The bonds qualified for tax-exempt status under a U.S. program to aid Midwestern states flooded in 2008. The "disaster bonds" got another boost from a loophole that was perfectly legal: In 2010, state officials ruled, based on guidance from the Internal Revenue Service, that companies could use such bonds even if they weren't hurt by the devastating floods or located in the hardest-hit parts of Iowa.
- Nicholas Eberstadt: Yes, Mr. President, We Are a Nation of Takers. Since 1960, entitlement transfers have grown twice as fast as personal income—to $2.3 trillion annually. In President Obama's second inaugural address, he not only outlined an ambitious agenda for his second term but also seemed intent on shutting down debate about the social-welfare state and its impact on American life.
- Clinton calls for change in law she says blocked discipline of employees over Libya. Secretary of State Hillary Clinton confirmed this week that several employees who were "removed" from their positions in the wake of the Libya terror attack are still being paid and have not actually left her department. But she also gave a surprising answer when asked why: Her hands are tied, she said.
- Microsoft(MSFT) Earnings Narrowly Beat Street Forecast. Software giant Microsoft reported quarterly earnings that were a penny higher than Wall Street's forecasts and revenue that was just shy of what analysts had expected on Thursday despite a lift from its latest version of Windows.
- Gallup Poll: Americans Most Negative On the Nation And Economy In 30 Years. (graph)
- Fed's Balance Sheet Tops $3 Trillion, But... (graphs)
- PIMCO On Hedging: It Pays To Be Countercyclical.
- GOOGLE(GOOG): US Government Requesting Even More Private Data Without Warrants. Google has revealed the full scale of the US government's use of controversial legislation that bypasses judicial approval to access the online information of private citizens.
- Debt Collectors Are Infiltrating Facebook(FB) To Track Down Delinquent Borrowers.
- SOROS: Japan's New Monetary Policy Will Badly Affect The German Economy.
- Joe Biden Recommends Buying A Shotgun When An Earthquake Strikes.(video)
- ‘Umm. Ooops.’: The Top 5 Answers to Hillary Clinton’s Benghazi Question of ‘What Difference…Does It Make?’ When
Secretary of State Hillary Clinton faced down Sen. Ron Johnson and
asked exasperatedly, “What difference at this point does it make” why
the attacks in Benghazi happened, she must have known it would spur
controversy.
- Samsung puts lid on capex for 1st time since financial crisis. Samsung Electronics Co turned cautious on spending for the first time since the global financial crisis, keeping its annual investment plan unchanged at 2012 levels, as demand for computer chips wanes and the smartphone market slows.
- Samsung Elec expects global PC market to shrink 5 pct in 2013. Samsung Electronics Co , the world's top memory chipmaker, said it expects the global personal computer market to shrink by 5 percent this year as consumer demand continues to shift to mobile devices such as tablet computers. The PC market declined for the first time in 11 years last year, according to research firm IHS iSuppli.
- US-based stock mutual funds gain for third straight week -Lipper.
- Starbucks(SBUX) stays hot in U.S., Asia; shares rise. Starbucks Corp reported stronger-than-expected sales in the United States and Asia despite economic uncertainty worldwide, offsetting unexpected costs including the bill for cleaning up after Superstorm Sandy.
- AT&T(T) subscriber growth beats but profit margin misses. AT&T Inc's fourth-quarter profit was lower than expected but the telephone company promised earnings and revenue growth this year even if the economy does not improve.
- Flextronics(FLEX) loses key customer RIM; sees weak 4th-qtr. Contract manufacturer Flextronics Inc forecast fourth-quarter results below Wall Street expectations, and said it now expects almost no revenue from key customer Research In Motion , sending its shares down 6 percent after the bell.
- A US housing recovery with a lot of long-term question marks. Optimism is building about a recovery in the US housing market but plenty of questions remain, writes Richard Blackden.
- Ctrip.com(CTRP) to Cut at Least 500 Sales People. The co. will cut all sales staff at airports, railway stations and bus stations in tier-2 and tier-3 cities, citing sales people at the company.
Citigroup:
- Downgraded (GS) to Neutral, target $150.
- Asian equity indices are -.75% to +.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 109.0 +1.0 basis point.
- Asia Pacific Sovereign CDS Index 85.0 -.25 basis point.
- FTSE-100 futures -.24%.
- S&P 500 futures -.25%.
- NASDAQ 100 futures -.10%.
Earnings of Note
Company/Estimate
- (COV)/1.06
- (HAL)/.61
- (HON)/1.09
- (KMB)/1.35
- (OSK)/.34
- (PG)/1.11
- (WY)/.20
10:00 am EST
- New Home Sales for December are estimated to rise to 385K versus 377K in November.
- (GILD) 2-for-1
- The UK gdp reprt, Germany IFO data and the (WPI) investor meeting could also impact trading today.
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