- Obama's Gun Curbs Face a Slog in Congress (BBG)
- Euro Area Seen Stalling as Draghi’s Pessimism Shared (BBG)
- China Begins to Lose Edge as World's Factory Floor (WSJ)
- EU Car Sales Slump (WSJ)
- Fed Concerned About Overheated Markets Amid Record Bond-Buying (BBG)
- Australia Posts Worst Back-to-Back Job Growth Since ’97 (BBG)
- Abe Currency Policy Stokes Gaffe Risk as Amari Roils Yen (BBG)
- Japan Opposition Party Won’t Back BOJ Officials for Governor (BBG)
- Fed Reports Point to Subdued Economic Growth (WSJ)
- China Set to Exit Slowdown by Boosting Infrastructure (BBG)
- Greece not out of woods, must stick to reforms: finance minister (Reuters)
- Russian Rate Debate Flares Up as Cabinet Seeks Growth (BBG)
Overnight Media Digest
* The Federal Aviation Administration on Wednesday ordered a halt to flights of Boeing Co's 787 Dreamliner, an unprecedented rebuke to the plane maker after two major battery malfunctions on its flagship jets.
* JPMorgan Chase & Co's directors cut Chief Executive James Dimon's pay by 50 percent for 2012, as the board took management to task for a trading debacle that cost the nation's largest bank more than $6 billion.
* Goldman Sachs Group Inc and Morgan Stanley agreed to pay a combined $560 million to settle allegations of foreclosure abuses, the latest setback in the banks' costly foray into subprime mortgages.
* Citigroup Inc has asked regulators for permission to repurchase just enough stock to counter dilution from routine share issuance, according to people familiar with the company's plans.
* Two bidders have emerged as leading contenders for ThyssenKrupp AG's steel operations in the Americas. ArcelorMittal SA submitted a $1.5 billion bid for a plant in Alabama, while Brazil's Companhia Siderúrgica Nacional submitted a $3.8 billion bid for that plant and a majority stake in a Brazilian mill, people familiar with the matter said.
* Hewlett-Packard Co has received expressions of interest from potential suitors for its Autonomy Corp business, the division that the technology giant has alleged engaged in accounting improprieties before HP acquired it in 2011, according to people familiar with the discussions.
* EBay Inc's revenue rose 18 percent in the latest quarter as business in the company's online marketplace and PayPal units continued to improve.
* Chipotle Mexican Grill Inc expects higher food costs to dampen fourth-quarter earnings, despite continued strength in its underlying sales trends.
* European retailer Metro AG said it is pulling out of the Chinese consumer-electronics business after two years of testing.
* China is losing its competitive edge as a low-cost manufacturing base, new data suggest, with makers of everything from handbags to shirts to basic electronic components relocating to cheaper locales like Southeast Asia.
Dozens of expatriate workers have been kidnapped from an Algerian natural gas facility operated by BP and Statoil .
Business Secretary Vince Cable will say in a speech that the debate over Britain's EU membership and a possible referendum is terrible timing, creating uncertainty for investors.
Opposition leader Ed Miliband said in an interview that Cameron's inability to guarantee that Britain will be in the EU in five years' time would be destabilising for investment.
Goldman Sachs cut its bonuses in the fourth quarter, boosting it to its highest profit level in three years.
Germany's Bundesbank is planning to repatriate 54,000 gold bars worth 27 billion euros from Paris and New York between now and 2020.
New rules that force British banks to hold more capital against loans secured on commercial property are resulting in higher costs and scrapped projects for developers.
* Long seen as one of the most careful banks on Wall Street, JPMorgan Chase & Co on Wednesday drew back a curtain on a rare breakdown, showing traders acting on their own and concealing losses while managers seemingly turned a blind eye. In a 129-page internal report dissecting a bad bet on credit derivatives that cost the bank more than $6 billion, the bank confessed, in painstaking detail, to widespread "failures."
* The Federal Aviation Administration said on Wednesday it was grounding all Boeing Co 787s operated by United States carriers until it can determine what caused a new type of battery to catch fire on two planes in nine days.
* Hewlett-Packard Co has received a number of inquiries from would-be buyers for its Autonomy and Electronic Data Systems units in recent weeks, though the technology company isn't interested in selling at the moment, a person briefed on the matter said.
* Goldman Sachs Group Inc on Wednesday released financial results that demonstrated it was not only benefiting from cost-cutting, but it also finally had a significant rebound in its core businesses. It reported a fourth-quarter profit of $2.89 billion, or $5.60 a share.
* To combat a rise in cybercrime, the European Commission is considering a plan to require companies that store data on the Internet - like Microsoft Corp, Apple Inc, Google Inc and International Business Machines Corp - to report the loss or theft of personal information in the 27-nation bloc or risk sanctions and fines.
* A new type of flu vaccine won regulatory approval on Wednesday, and its manufacturer said that limited supplies are expected to be available this winter.
* After an estimated 500,000 patients in the United States have received a type of artificial hip that is failing early in many cases, the Food and Drug Administration is proposing rules that could stop manufacturers from selling such implants.
* Robert Wolf, a top Wall Street rainmaker who left UBS AG last summer, has hired Austan Goolsbee as a "strategic partner" for his new firm, 32 Advisors, the two men have told friends in recent weeks, according to people briefed on the matter.
* Nearly half of Germany's gold reserves are held in a vault at the Federal Reserve Bank of New York - billions of dollars worth of postwar geopolitical history squirreled away for safe keeping below the streets of Lower Manhattan. Now the German central bank wants to make a big withdrawal - 300 tons in all.
THE GLOBE AND MAIL
* Canada's energy and mining companies are facing new challenges from First Nations that are demanding the right to approve all resource projects on traditional territories and to participate in the revenues.
* French President François Hollande has personally asked Canadian Prime Minister Stephen Harper to extend Canada's contribution of a heavy-lift cargo plane for Mali, and to offer more transport help, testing Harper's efforts to set strict limits on Canada's military assistance.
Reports in the business section:
* Air Transat will cut $20 million in annual operating cost as part of its parent company's efforts to restore profitability in the face of toughening competition.
Executives told employees on Wednesday that the airline needs to realize the savings in order to operate a fleet of Boeing 737 aircraft and replace those flown under subcontract by Nova Scotia-based Canjet since 2009.
* H&R Real Estate Investment Trust on Wednesday offered to buy Primaris Retail Real Estate Investment Trust for nearly C$3 billion ($3.04 billion), or C$28 a share, just above a hostile C$26 per share bid put forward in December by a consortium led by KingSett Capital.
* An Ontario bodyguard who worked for Saadi Gaddafi -- the son of slain Libyan leader Muammar Gaddafi -- provided "invaluable assistance" to the Libyan dictatorship as it attempted to brutally crush an anti-regime uprising in 2011, the Canada Border Services Agency said.
* A new study has indicated that overdose deaths have risen in close parallel with Canada's soaring consumption of prescription narcotics and the painkillers have become the country's most dangerous drugs after tobacco and alcohol, a leading addiction researcher of Simon Fraser University said.
* Calgary-based Sunshine Oil Sands Ltd has agreed to share oil sands exploration technology with a division of China's CNOOC Ltd.
The one-year "cooperation" agreement comes roughly one month after the federal government approved the sale of oil sands producer Nexen Inc to CNOOC for $15.1 billion.
* Lululemon Athletica Inc has its sights on growing its share in menswear, CEO Christine Day said at the ICR XChange investor conference in Miami on Wednesday, a rare bright spot in last year's apparel market.
A little over a year and a half ago, menswear represented 8 percent of sales at the Vancouver-based retailer. while on a year to date basis the category has hit 12 percent with the holiday season peaking at 15 percent, Day said.
CHINA SECURITIES JOURNAL
--The yuan's real effective exchange rate (REER), which measures the currency's value against a trade-weighted basket after adjustments based on inflation, hit a record high of 110.16 in December, Bank for International Settlements (BIS) data showed.
SHANGHAI SECURITIES NEWS
--In the first two weeks of January, new loans from China's "big four" banks hit 270 billion yuan ($43.43 billion), with industry insiders expecting that the total new loans are likely to hit one trillion yuan in January.
--China's tax revenue rose 11.2 percent to 11.7 trillion yuan in 2012, data from the state administration of taxation showed.
Fly on the Wall 7:00 AM Market Snapshot
Adtran (ADTN) upgraded to Neutral from Sell at Citigroup
Bio-Rad (BIO) upgraded to Outperform from Underperform at CLSA
GT Advanced (GTAT) upgraded to Hold from Underperform at Jefferies
Infinera (INFN) upgraded to Overweight from Neutral at JPMorgan
Juniper (JNPR) upgraded to Overweight from Neutral at JPMorgan
Medtronic (MDT) upgraded to Outperform from Neutral at Credit Suisse
Mercury General (MCY) upgraded to Outperform from Neutral at Macquarie
Mohawk (MHK) upgraded to Outperform from Underperform at Macquarie
PerkinElmer (PKI) upgraded to Buy from Outperform at CLSA
Rio Tinto (RIO) upgraded to Buy from Neutral at Citigroup
Adtran (ADTN) downgraded to Sell from Neutral at UBS
Agilent (A) downgraded to Outperform from Buy at CLSA
BNY Mellon (BK) downgraded to Sector Perform from Outperform at RBC Capital
Boeing (BA) downgraded to Underweight from Hold at BB&T
Celsion (CLSN) downgraded to Sell from Hold at Brean Capital
Cisco (CSCO) downgraded to Underweight from Neutral at JPMorgan
Columbia Sportswear (COLM) downgraded to Underperform from Buy at BofA/Merrill
Corning (GLW) downgraded to Sector Perform from Outperform at RBC Capital
Cree (CREE) downgraded to Underperform from Buy at Jefferies
Itron (ITRI) downgraded to Hold from Buy at Jefferies
Leap Wireless (LEAP) downgraded to Underperform from Hold at Jefferies
RBC Bearings (ROLL) downgraded to Market Perform from Outperform at William Blair
Regal-Beloit (RBC) downgraded to Perform from Outperform at Oppenheimer
Regeneron (REGN) downgraded to Hold from Buy at Brean Capital
SAP (SAP) downgraded to Neutral from Buy at Citigroup
VIVUS (VVUS) downgraded to Sell from Hold at Brean Capital
Waters (WAT) downgraded to Market Perform from Outperform at Wells Fargo
Williams-Sonoma (WSM) downgraded to Market Perform from Strong Buy at Raymond James
Williams-Sonoma (WSM) downgraded to Neutral from Buy at Goldman
Alkermes (ALKS) initiated with a Neutral at Credit Suisse
Approach Resources (AREX) initiated with an In-Line at Imperial Capital
Asset Acceptance (AACC) initiated with a Neutral at Janney Capital
Concho Resources (CXO) initiated with an Outperform at Imperial Capital
Eli Lilly (LLY) initiated with a Sell at CLSA
Encore Capital (ECPG) initiated with a Buy at Janney Capital
Portfolio Recovery (PRAA) initiated with a Neutral at Janney Capital
Stillwater Mining (SWC) initiated with an Outperform at Wells Fargo
U.S. Silica (SLCA) initiated with a Sector Perform at RBC Capital
Vanda Pharmaceuticals (VNDA) initiated with an Outperform at JMP Securities
FAA ordered Boeing (BA) to temporary cease operations of all U.S. 787 Dreamliners jets, Bloomberg reports
Rio Tinto (RIO) said CEO Albanese stepped down after charges
Expects non-cash impairment charge of $14B
Stryker (SYK) acquired Trauson Holdings for $764M in cash
Sun Life Financial (SLF), Khazanah Nasional Berhad to purchase CIMB Aviva for C$586M
Treasury Department hired Citigroup (C), JPMorgan (JPM) to sell General Motors (GM) shares, Bloomberg reports
Nokia (NOK) to cut 300 jobs, transfer 820 others amid changes in IT
AT&T (T) to enable FaceTime over Cellular (AAPL) for all iOS devices at no extra charge
CBS (CBS) began converting its Outdoor Americas division into a REIT, and will pursue a divestiture of its Outdoor operations in Europe and Asia
A. M. Castle (CAS) announced restructuring plan, will reduce workforce by 10%
eBay (EBAY) said Europe still “sluggish,” said Latin America an “important growth opportunity”
Said PayPal-Discover partnership to go live at end of Q2
K-Swiss (KSWS) to be acquired by E.Land World for $4.75 per share in cash
Companies that beat consensus earnings expectations last night and today include: Fifth Third Bancorp (FITB), Insteel (IIIN), BlackRock (BLK), Huntington Bancshares (HBAN), Virginia Commerce (VCBI), BB&T (BBT), H.B. Fuller (FUL), Bank of the Ozarks (OZRK), Clarcor (CLC), SLM Corp. (SLM), eBay (EBAY), Nautilus (NLS)
Companies that missed consensus earnings expectations include:
CVB Financial (CVBF), Plexus (PLXS), Kinder Morgan Energy (KMP), Kinder Morgan (KMI), Boston Private Financial (BPFH)
Companies that matched consensus earnings expectations include:
UnitedHealth (UNH), Pacific Continental (PCBK)
Investors are grappling with what could be a watershed moment for Apple (AAPL). In many fund managers' eyes, the recent decline could mark Apple's transformation from a growth stock—one that is seen as risky but whose growth prospects could lead to big gains—to a more plodding value stock—one that trades at a low price relative to earnings and offers regular payments such as dividends, the Wall Street Journal reports
The power that U.S. baby boomers have exercised for some 50 years over the auto industry is starting to wane. Auto industry executives at the North American International Auto Show in Detroit this week made it clear with their designs for coming models that they are pivoting their attention—and their product strategies—toward the 20, 30 and 40-something consumers collectively known as Generations X and Y, the Wall Street Journal reports
PC makers, trying to beat back a tablet mania that's hurting their sales, are making what may be a last attempt to sway customers by mimicking the competition, Reuters reports
Airbus (EADSY) reported a 43% drop in orders and lost its title as the world's largest plane maker to Boeing (BA) in 2012, as it predicted improvements in orders and deliveries for 2013 as airlines look to reduce fuel costs. Adjusted for cancellations, Airbus had 833 net orders, while Boeing led on net orders with 921 aircraft, Reuters reports
Fed officials are increasingly concerned that record-low interest rates are overheating markets for assets from farmland to junk bonds, which could heighten risks when they reverse their bond purchases, Bloomberg reports
Treasuries fell, as 10-year notes halted a four-day advance, before Commerce Department data forecast to show U.S. housing starts rose last month, adding to signs the U.S. economy is improving, Bloomberg reports
Aveo Pharmaceuticals (AVEO) commences offering of common stock
CVR Refining (CVRR) 24M share IPO priced at $25.00
Imation (IMN) files to sell 3.32M shares of common stock for holders
Northern Tier (NTI) commences offering of 9M common units by holders