Weekend Headlines
Bloomberg:
- Profits Top Forecasts as Apple(AAPL), LG Chem Wring Out More Savings. First-quarter earnings have beaten forecasts so far, as companies from Apple Inc. (AAPL) to Novartis AG (NOVN) and LG Chem Ltd. (051910) wring more profit from operations worldwide and an economic pickup buoys sales. Since April 11, 71 percent of MCSI World Index members reporting results have topped analysts’ estimates for earnings per share, according to data compiled by Bloomberg. Profits of the 188 companies have beaten forecasts by 8.8 percent. Companies are exceeding estimates by using productivity measures to get more out of workers and factories.
- Syria Detains Anti-Assad Activists After Dealiest Protests Against Regime. Syrian security forces detained at least 200 people in widespread sweeps as some officials announced their resignations following the killing of dozens of anti-government protesters, activists said. Mahmoud Merhi, who heads the Arab Organization for Human Rights, said in an interview from Damascus that 200 to 300 people have been detained since April 22. Many of those arrested were taken from their homes at night, according to Haitham al- Maleh, a member of the Syrian Human Rights Committee, who estimates “hundreds” were arrested. Syrian President Bashar al-Assad has failed to quell protests after pledging steps to meet activists’ demands and end a 48-year state of emergency. Khalil al-Rifai and Nasser al- Hariri, lawmakers from the southern town of Daraa, the scene of the deadliest clashes, resigned yesterday. The city’s top government-appointed religious leader, Mufti Rizq Abdel Dayem Abazid, also said he quit yesterday.
- Toyota Says Global Output Will Return to Normal by November or December. Toyota Motor Corp. (7203) expects production to return to normal by December at the latest, as the world’s biggest carmaker struggles with supply-chain disruptions caused by Japan’s record earthquake and tsunami. The automaker will begin raising production to regular levels from July in Japan and from August at overseas plants, the company said in a statement today. Output for all models will be normal by November or December, it said.
- Southwest(LUV) AirTran(AAI) Resume Flights at St. Louis; Full Service From Midweek. Southwest Airlines Co. (LUV) plans full operations today and AirTran Holdings Inc. (AAI)’s AirTran Airways has resumed some service at Lambert-St. Louis International Airport in St. Louis after a tornado forced the airport to close.
- China Property Tax 'Desperately Needed' to Fix Wealth Gap, Researcher Says. A property tax in China is “desperately needed” to “reverse” the country’s imbalances in wealth distribution, Zhang Monan, a researcher with the State Information Center, wrote in a commentary published in today’s China Daily newspaper. The nation needs to improve its property reporting system and to levy taxes on various personal holdings, including on real estate, capital earnings, inheritances and donations, Zhang wrote. The State Information Center is a research agency under the National Development and Reform Commission. China should also “moderately” shift some taxation powers to local governments from the central government to help “extricate” some local governments from excessive dependence on land for revenue, Zhang wrote.
- BP's(BP) Quest for Transocean(RIG) Spill Payment May Be Helped by Report. A U.S. Coast Guard report that cited safety failures by drilling-rig owner Transocean Ltd. (RIG) may help bolster BP Plc (BP/)’s effort to recover some of the costs of last year’s oil spill in the Gulf of Mexico, an analyst said.
- Yemen's Saleh May Quit in Swap for Immunity. Yemen President Ali Abdullah Saleh agreed to a plan brokered by the Gulf Cooperation Council that would give him immunity in exchange for ceding power, a government official said.
- China Stocks Drop to 3-Week Low as Rising Oil Prices Boost Inflation Risk. China’s stocks fell, driving the benchmark index to the lowest level in three weeks, as higher oil prices boosted concerns inflation will accelerate and spur more policy tightening measures.
- Corn Seen Topping Wheat, Raising Tyson Costs, Helping Syngenta. Corn may become costlier than wheat for the first time since 1984 as demand for livestock feed and ethanol grows, increasing expenses for Tyson Foods Inc. (TSN) and boosting sales at Syngenta AG. (SYNN)
- U.S. Seeks to Raise Heat on Syria. The U.S. is readying sanctions against senior officials in Syria who are overseeing a violent crackdown as Washington and Europe suggest the regime of President Bashar al-Assad is increasingly fragile. The Obama administration is drafting an executive order empowering the president to freeze the assets of these senior Syrian officials and ban them from any business dealings in the U.S., according to officials briefed on the deliberations. Unilateral sanctions by Washington on Syrian officials wouldn't have much direct impact on Mr. Assad's inner circle, as most regime members have few holdings in the U.S.
- Tokyo Says Risk of Radiation Leak, Explosion Receding. The immediate danger of explosions or major radiation leaks at the Fukushima Daiichi nuclear-power plant has receded, a top Japanese administration official said, even as the government and the plant's operator battle to keep it stabilized.
- Wall Street, Banks Press to Shape Dodd-Frank Rules. Wall Street and the financial industry spent more to lobby Washington in the first quarter of this year than a year ago when Congress was writing sweeping financial-overhaul legislation, according to a Wall Street Journal review of lobbying reports released Thursday. The law, known as Dodd-Frank, was adopted nine months ago but banks, credit unions, investment firms and their trade groups now are trying to shape how it is put into practice. The documents show financial-industry lobbyists are spending time with regulators, who are writing hundreds of rules to carry out the law, while pushing Congress to roll-back certain provisions, especially new limits on debit-card fees.
- How Health Reform Punishes Work. The subsidies to buyers of 'qualifying' insurance policies will induce sharp reductions in the supply of labor. Supporters of ObamaCare acknowledge it will have some unintended consequences. Yet surprisingly little attention has been focused on the law's most problematic provision: government subsidies to help individuals and families purchase health insurance. This new entitlement—which the chief actuary of the Centers for Medicare and Medicaid Services estimates will cost more than $100 billion per year once it is fully implemented—will damage the country's long-term fiscal outlook. It also will introduce far-reaching negative effects on rewards to work and bizarre new inequities into American life.
- China PBOC Plans Forex-Reserve Investment Funds - Report. China's central bank is planning to set up investment funds targeting sectors such as energy and precious metals that will make use of the country's massive foreign-exchange reserves, and is also studying the possibility of creating a foreign-exchange stabilization fund, Caixin Media reported on its website Monday, citing unnamed sources. "Relevant authorities" are studying a suggestion by the People's Bank of China that the country's forex regulator use some of the forex assets from the PBOC's balance sheet to set up a fund to intervene in the forex market, the report said, citing a source close to the PBOC.
- Japan's Defense Minister Seeks Stronger Military Ties to U.S. Japan needs to strengthen military ties with the U.S. and South Korea to keep China's military expansion in check, its defense minister said Friday, signaling that the nation's heavy post-earthquake reconstruction burden won't change its national-security priorities.
- Medical Marijuana Companies Chase Investors, Eye IPOs. In what was once a pipe dream, medical-marijuana companies are courting private investors and even planning public stock sales.
- Reactor Team Let Pressure Soar. The operator of Japan's stricken nuclear plant let pressure in one reactor climb far beyond the level the facility was designed to withstand, a decision that may have worsened the world's most serious nuclear accident in a quarter century. Japanese nuclear-power companies are so leery of releasing radiation into the atmosphere that their rules call for waiting much longer and obtaining many more sign-offs than U.S. counterparts before venting the potentially dangerous steam that builds up as reactors overheat, a Wall Street Journal inquiry found.
- Bank of America(BAC) Wins Dismissal From Countrywide Mortgage Securities Suit. Bank of America Corp. (BAC) was dismissed from a lawsuit brought by investors who bought mortgage-backed securities sold by Countrywide Financial Corp., the home lender Bank of America acquired in 2008. U.S. District Judge Mariana Pfaelzer granted Bank of America’s request to dismiss the claim against it on grounds that it can’t be held liable for actions of a unit, according to an April 20 order filed in Los Angeles.
- Greenpeace Occupies Oil Rig Off Istanbul. Greenpeace says its activists have climbed aboard an oil rig to prevent its departure for Greenland to begin drilling in the Arctic. The environmental group said Friday activists used speedboats to intercept and climb aboard the Leiv Eiriksson as it left Istanbul. The group said activists had unfurled a banner reading: "Stop Arctic destruction." Greenpeace said activists were prepared to occupy the rig for days. It said the oil rig, operated by Cairn Energy, has "a very short window in which to drill their four new exploratory wells" due to extreme weather conditions in the Arctic. Leiv Eiriksson, one of the world's largest rigs, had been exploring possible oil and gas in the Black Sea under a joint venture between Turkey and Brazil's Petrobas.
- Camouflaging Price Creep. The Easter special at many retailers this year involves higher price tags. As retailers have been warning, their costs are rising as cotton and other materials get more expensive, laborers in China demand higher wages and fuel prices go up. By this fall, many have said, they must charge customers more. Because retailers pay for items about six months in advance, spring merchandise on the shelves for a few months was ordered and paid for in late summer, before costs soared. And when costs first started creeping up, clothing makers used an array of tactics to keep prices flat, whether by moving production to lower-cost countries like Bangladesh, using cheaper fabrics or ordering early to lock in prices. By this time, though, retailers are running out of ways to avoid passing on the higher expenses. An uptick has quietly begun.
- Nation's Mood at Lowest Level in Two Years, Poll Shows. Americans are more pessimistic about the nation’s economic outlook and overall direction than they have been at any time since ’s first two months in office, when the country was still officially ensnared in the Great Recession, according to the latest New York Times/CBS News poll. Amid rising gas prices, stubborn unemployment and a cacophonous debate in Washington over the federal government’s ability to meet its future obligations, the poll presents stark evidence that the slow, if unsteady, gains in public confidence earlier this year that a recovery was under way are now all but gone. Capturing what appears to be an abrupt change in attitude, the survey shows that the number of Americans who think the economy is getting worse has jumped 13 percentage points in just one month. Disapproval of Mr. Obama’s handling of the economy has never been broader — at 57 percent of Americans — a warning sign as he begins to set his sights on re-election in 2012.
- Source: U.S. Departs Pakistan Base. A senior Pakistani intelligence official told CNN Friday that U.S. military personnel have left a southern base said to be a key hub for American drone operations in the country's northwestern tribal areas. It is the Shamsi Air Base in Pakistan's Balochistan Province, from which drones are said to take off and where they are refueled for operations against Islamic militants. The development comes amid a public furor over American drone attacks, which have killed civilians.
- China Orders Bank Stress Tests That Factor In A Massive, 50% Collapse In Housing Prices.
- 20 Secret Tips and Tricks To Get The Most Out Of Your iPhone.
- Why The Fed Must End QE2 on April 27th.
- Hawaii Average Premium Gas Hits $4.708, As Nationwide Pump Prices Jump By 30 Cents In A Month.
- Japan to Censor, Take Down "Irresponsible" Fukushima Information and Reporting.
- Airlines Face 'Very Difficult' Year, IATA Chief Tells Tribune. Europe is the "biggest problem by far" for the airline industry with an average economic growth rate of 1.7%, and there is no consensus between European governments on taxation and harmonization of air traffic regulations, IATA President Giovanni Bisignani said. Oil prices at more than $1105 a barrel are a "disaster" for the global industry, he said.
- German Chancellor Angela Merkel is unlikely to get majority support from her government coalition for the European Stability Mechanism, German Free Democratic Party lawmaker Frank Schaeffler said.
- China's consumer price index may rise between 4.9% and 5.1% in the second quarter of the year, citing Xu Lianzhong, an official with the National Development and Reform Commission's Analysis and Prediction Office.
- Chinese President Hu Jintao said the country's growth still faces many "risks and challenges", according to a transcript of his speech. The nation remains the world's largest developing country, Hu said.
- China should slow the growth of its foreign-exchange reserves, otherwise efforts to curb inflation and home prices will be "greatly affected," Guan Tao, head of the State Administration of Foreign Exchange's balance of payments department, wrote.
- China's mutual funds reduced their combined holdings of stock at the end of the first quarter by 2.8% from the end of 2010, citing TX Investment Consulting Co.
- Some Chinese brokerages are reducing the number of stocks they offer clients for short selling after shorting of Henan Shuanghui Investment & Development Co. led to losses for some brokerages, citing sources at brokerages.
- Mossad Races to Foil Hizballah Attack on Israeli-Jewish Targets. For the first time in Israel's 63-year old battle against terror, its external security agency Mossad Thursday night, April 21, issued a strong warning to travelling Israelis to beware of a major terrorist attack which Hizballah had already set in motion at some undisclosed location. The only information attached to the warning was that Hizballah had consigned a high-profile team for an operation to avenge the slaying of its top commander Imad Mughniyeh three years ago for which it blames Israel.
Barron's:
- Made positive comments on (OVTI) and (OMG).
- Reiterated Buy on (SLB), boosted target to $115.
- Reiterated Buy on (MXIM), target $35.
- Reiterated Buy on (RHI), target $40.
- Reiterated Buy on (DD), target $65.
- Reiterated Buy on (NUE), target $53.
- Asian indices are -.25% to +.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 104.50 -.5 basis point.
- Asia Pacific Sovereign CDS Index 111.50 -1.0 basis point.
- S&P 500 futures +.13%.
- NASDAQ 100 futures +.05%.
Earnings of Note
Company/Estimate
- (CBE)/.84
- (JCI)/.56
- (BEAV)/.46
- (NFLX)/1.07
- (HMA)/.21
- (MAS)/-.03
- (UIS)/.44
- (ESRX)/.69
- (OMI)/.47
- (PCL)/.24
- (BXS/.09
- (VECO)/1.23
- (KMB)/1.17
- (JEC)/.62
- (Y)/3.32
- (PEGA)/.17
- (AAN)/.51
10:00 am EST
- New Home Sales for March are estimated to rise to 280K versus 250K in February.
- (HEI) 5-for-4
- The Dallas Fed Manufacturing Activity Index and 3-Month/6-Month Treasury Bills Auctions could also impact trading today.
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