Today's Headlines

Bloomberg:

• Euro-Area Unemployment Rises to Record 12% Amid Slump. The euro-area jobless rate rose to a record 12 percent in early 2013, adding to signs that the currency bloc’s recession extended into the first quarter. Unemployment in the 17-nation euro area was 12 percent in February and the January figure was revised up to the same level from 11.9 percent estimated earlier, the European Union’s statistics office in Luxembourg said today. That is the highest since the data series started in 1995 and matches the median estimate of 31 economists in a Bloomberg News survey.
• France to Apply 75% Tax to Soccer Players’ Compensation. “This new tax will cost first-division teams 82 million euros,” France’s Football League said in a statement. “With these crazy labor costs, France will lose its best players, our clubs will see their competitiveness in Europe decline, and the government will lose its best taxpayers.”
• European Stocks Climb to Two-Week High; Vodafone Gains. The Stoxx Europe 600 Index (SXXP) climbed 1.3 percent to 297.52 at the close of trading. The gauge added 5.8 percent in the first quarter as U.S. lawmakers agreed on a compromise budget and optimism grew that central banks around the world will continue stimulus measures to support an economic recovery.
• Black Hawks Near North Korea Show Risks in U.S. Command Shift.
• Raw-Material Bull Market Fading as Supply Expands: Commodities. At a time when U.S. equities are trading near a record and the dollar is having its best start in three years, commodities will finish this quarter little changed from where they were at the end of 2012. The Standard & Poor’s GSCI gauge of 24 raw materials will be at 644 at the end of June, 1.2 percent lower than now, according to the median of nine investor and analyst predictions compiled by Bloomberg.

Wall Street Journal:

• Skepticism Grows Ahead of BOJ Meeting. As Japan's central bank readies a bold plan for reversing chronic price falls and hitting an inflation target of 2% in two years, a chorus of naysayers—ranging from government officials to senior economists and market-watchers—is saying it can't be done.

Dow Jones:

• Valero: EPA Gasoline Plan Will Cost Hundreds of Millions of Dollars. Valero Energy Corp. (VLO) said the cost of complying with new pollution standards for gasoline will cost hundreds of millions of dollars in equipment construction and upgrades alone.

 Fox News:

•  UN adopts pact to regulate multibillion-dollar global arms trade.

MarketWatch:

• Cyprus sits close to exit door as four trends point to euro-zone collapse – UBS.

CNBC:

• Hedge Funds Have a Brutal Quarter, but Loeb Stands Out. Hedge funds, on average, returned just above 3 percent in the first quarter of 2013, a brutal return compared to buyers of an S&P 500 index fund, who enjoyed a 10 percent return on their money. 
• El-Erian: Unfortunately, the Cyprus Crisis Is Not Yet Over. Draconian capital controls have restored a sense of calm to a disorderly situation in Cyprus. At best, this is a short reprieve. If not followed by more fundamental (and inevitably controversial) decisions, it will just be a matter of weeks before the controls go from being a temporary solution to becoming part of an even deeper problem. 
• Fed May Be Able to Pull Back on Stimulus This Year: Lockhart. The Federal Reserve may be able to reduce its bond-buying stimulus plan before the end of this year if economic growth continues to pick up and employment improves further, a top central bank official said.

Zero Hedge: 

• Chart Of The Day: Euro Area Unemployment Hits New Record High.
• Debt = Serfdom.
• Factory Orders "Saved By The Transports", Annual Increase Barely Positive. (graph)
• You Know The Market's Euphoric When...(graph)
• China Raises Epidemic Response Plan Amid Re-Emergence Of Bird Flu.
• Holland: "An Economy On The Brink".

Business Insider: 

• We Just Got To See The European Crisis That's Far Bigger Than Cyprus Or Italy.
• Apple(AAPL) Planning Production Of New iPhone Starting This Quarter.
• US Moves Second Warship Near Korean Peninsula Amid Tensions.
• JIM O'NEILL: I Suspect China Is Growing More Slowly Than Everyone Thinks.

Reuters:

• North Korea to restart nuclear reactor in weapons bid. North Korea said on Tuesday it would revive a mothballed nuclear reactor able to produce bomb-grade plutonium but stressed it was seeking a deterrent capacity and did not repeat recent threats to attack South Korea and the United States. 
• ECB's Coeure warns against consequences of currency war. ECB policymaker Benoit Coeure warned against currency wars on Tuesday, saying currency swings brought about by misguided policies have the potential to become disruptive, especially if other central banks have limited room to maneuver. 
• Italy's "wise men" seek to end political crisis; president gloomy. Italian President Giorgio Napolitano expressed despair on Tuesday at fierce criticism of his latest plan to end a post-election deadlock that has raised fears of months of instability in the euro zone's third largest economy.
• Copper falls to seven-month low as weak data dampens mood.

Financial Times:

• US banks weigh EU bonus cap options. Foreign banks in the City of London are stepping up tactics to mitigate the impact of incoming EU bonus caps. Bankers said US institutions were considering whether it still made sense to base Europe, Middle East and Africa (Emea) business in London, suggesting that Dubai or another Gulf financial centre could benefit instead.
• EU data watchdogs take aim at Google(GOOG). Europe’s largest data-protection authorities have launched a joint action against Google to force it to remedy alleged breaches of EU privacy rules by the search giant.

Telegraph: 

• UK manufacturing shrinks again in March. British manufacturing shrank for a second successive month in March as companies scaled back production, leaving the services sector as the best hope of avoiding a fresh recession.