- When the cash runs out dividends go away: Nokia to Omit Dividend for First Time in 143 Years (BBG)
- Passing Debt Bill, GOP Pledges End to Deficits (WSJ)
- Japan logs record trade gap in 2012 as exports struggle (Reuters)
- so naturally... Yen at 100 Per Dollar Endorsed by Japan Government’s Nishimura (BBG)
- Japan rejects currency war fears (FT)
- Investors grow cagey as Italy election nears (Reuters)
- In Amenas attack brings global jihad home to Algeria (Reuters)
- Mafia Victim’s Son Holds Key to Bersani Winning Key Region (BBG)
- Bernanke Seen Pressing On With Stimulus Amid Debate on QE (BBG)
- U.S. to lift ban on women in front-line combat jobs (Reuters)
- Red flags revealed in filings of firm linked to Caterpillar fraud (Reuters)
- Apple Sales Gain Slowest Since ’09 as Competition Climbs (BBG)
- Spanish Jobless Rate Hits Record After Rajoy’s First Year (BBG)
- North Korea Threatens Nuclear Test to Derail U.S. Policies (BBG)
Overnight Media Digest
* Apple Inc recorded a flat profit despite selling 18 million more iPhones and iPads as it spent heavily to roll out new products to fend off intensifying competition.
* The U.S. House of Representatives defused one potential debt crisis Wednesday, while a top Republican set the stage for a far broader debate over whether it is possible to actually balance the U.S. budget in coming years.
* A government informant has implicated a prominent former trader at SAC Capital Advisors, telling federal investigators the two swapped confidential stock tips for years, according to people briefed on the matter.
* NYSE Euronext has no intention of selling its European unit to a rival following a planned takeover by IntercontinentalExchange Inc, according to NYSE Euronext's chief executive.
* The value of Goldman Sachs Group Inc's investment portfolio doubled last year. Bond underwriting hit a five-year high. The firm's workforce shrank and remaining employees were paid a smaller chunk of overall revenue.
* General Dynamics Corp swung to a fourth-quarter loss, posting a $2 billion write-down in its information-technology business that Chief Executive Phebe Novakovic called a "reset".
* McDonald's Corp's fourth-quarter earnings beat expectations, reversing two quarters of misses, but the world's largest restaurant chain said it expects tough times ahead.
* Netflix Inc capped a turbulent year by posting a surprise fourth-quarter profit and adding more Internet subscribers than expected, news that sent its stock rocketing about 35 percent in after-hours trading.
* As Novartis AG Chairman Daniel Vasella steps down from the company he helped build over 25 years, he leaves behind one of the health-care industry's most admired firms - but also some shareholder resentment and big questions about Novartis's future.
* Loretta Fredy Bush, the high-profile founder of China's Xinhua Finance Ltd who was later indicted over an alleged $50 million fraud, has agreed to a plea deal and appears poised to plead guilty to a reduced charge.
FSA PROBES ICAP OVER LIBOR FIXING ICAP, the world's largest interdealer broker, has become a focus of the UK Libor rate-rigging investigation and is being investigated by the UK financial watchdog for possible breaches of market conduct rules. () CAMERON PUTS EU FUTURE ON THE LINE David Cameron put Britain's future in the EU on the line in an audacious gamble that united his Conservative party but could have profound implications for the country.
UK LABOUR MARKET DEFIES GLOOM The puzzle of Britain's productivity performance grew on Wednesday, with an unexpectedly buoyant set of employment figures ahead of Friday's output data for last year's fourth quarter, which many economists think will show a dip.
GMG ENDS TALKS TO SELL TRADER STAKE Guardian Media Group has called off talks with interested buyers over the sale of its half stake in the car classifieds company Trader Media Group following a failure to agree a price. Apax, its joint venture partner in Trader Media, had been interested in buying out the 50.1 per cent owned by GMG in a deal that would have netted the publisher of the Guardian and the Observer around 300 million pounds in cash.
CHINESE FUND AND SCHMIDT-BACKED BANK UNITE A boutique merchant bank backed by Google executive chairman Eric Schmidt has struck a deal with a Chinese state-owned fund to work together on media, sport and entertainment acquisitions. Raine's partnership with China Media Capital, which manages a Rmb5bn ($805m) fund, is the latest sign that China's nascent but fast-growing media sector is keen to borrow expertise and contacts from established western operators.
* Investors have come to expect nothing short of perfection from Apple Inc but with the company's stock sinking 11 percent, it is clear there are a range of challenges.
* Avoiding an economic showdown with President Obama, the House on Wednesday passed legislation to eliminate the nation's statutory borrowing limit until May, without including the dollar-for-dollar spending cuts that Republicans once insisted would have to be part of any debt limit bill.
* Prime Minister David Cameron of Britain has added to Europe's malaise, vowing to reduce British entanglement with the European Union - or allow his people to vote in a referendum to leave the bloc altogether.
* Daniel Vasella, the longtime chairman and former chief executive of Novartis, the Swiss drug maker, plans to step down next month, the company said on Wednesday, when it also reported a jump in fourth-quarter profit.
* The International Monetary Fund said on Wednesday that it continued to expect a modest upturn in global growth in 2013, with fewer risks of major policy mistakes and lower levels of financial stress.
* Netflix Inc reported $8 million in net income, surprising analysts who had expected a slight loss. It increased the number of subscribers for its streaming service to 27 million.
* The Boeing 787's difficulties have raised questions about how regulators certify new technology and how they balance advances in design and engineering with safety.
* Japan on Thursday reported a record annual trade deficit in 2012, the second straight year in the red for an exporting nation that has long built its wealth on its vast trading surpluses.
* A survey of manufacturing activity in China on Thursday provided more reassurance that the Chinese economy, buoyed by somewhat improved global trade and a string of government stimulus measures last year, has settled into a muted recovery.
* US Airways Group Inc reported on Wednesday that its net income doubled in the fourth quarter from a year earlier, and its executives said strong passenger demand for the airline could lead to higher fares.
* The long decline in the number of American workers belonging to labor unions accelerated sharply last year, according to data reported on Wednesday, sending the unionization rate to its lowest level in close to a century.
THE GLOBE AND MAIL
* Nigeria, the leading power in West Africa, wants Canada and other western nations to take on the conflict in Mali as an international problem and provide funding and heavy equipment like helicopters.
* As Canadian finance minister Jim Flaherty prepares the Conservative government's 2013 budget, his main target will be to balance the books by 2015. With that horizon in mind, economists see several reasons for him to be optimistic, including positive signs from the United States and European economies, as well as the country's housing market.
Reports in the business section:
* The Bank of Canada is setting aside worries over a housing bust to double down on a broader concern, the country's sputtering economy.
The central bank surprised Bay Street and Wall Street on Wednesday by dropping from its latest policy statement any hint that it would raise interest rates to deter Canadians from bidding up housing prices and adding to record levels of household debt.
* RBC Dominion Securities raised its price target for Research In Motion Ltd to C$19 from C$11 ahead of the crucial launch of the smartphone maker's BlackBerry 10 devices, but warned that it is "far too early" to call the company's turnaround a success.
* Canadian Prime Minister Stephen Harper said he was searching for a "consensus" within Canada and the Parliament on how to contribute to stopping the spread of terrorism in Mali, but he would not allow a direct Canadian military mission into the African country.
* Manitoba chiefs are not poised to cede from the assembly of First Nations, but leaders gathered in Winnipeg on Wednesday raised questions about the national body's mandate to represent aboriginals on treaty issues.
* Bombardier Inc CEO and President Pierre Beaudoin said he hopes that its CSeries airliners will take its first flight in June, demonstrating that the Quebec transportation giant has learned the lessons from Boeing Co's difficulties with its 787 Dreamliner.
* The Canadian and global economies will continue struggling to maintain momentum this year, but in a relatively hopeful new outlook, the International Monetary Fund (IMF) said it saw light at the end of the tunnel.
The IMF now expects Canada's economy to expand by a modest 1.8 percent this year and by 2.3 percent in 2014.
CHINA SECURITIES JOURNAL
--The value-added growth of large industrial enterprises is expected to rise 10 percent, said Zhu Hongren, chief engineer at the Ministry of Industry.
--The Industrial & Commercial Bank of China, the world's biggest bank by market value, said the volume of its renminbi cross-border business hit over 1.5 trillion yuan ($241.24 billion) in 2012, rising 70 percent from a year earlier.
SHANGHAI SECURITIES NEWS
- Hong Kong is working closely with Chinese authorities to promote the mutual recognition of investment funds, which would pave the way for these funds to be sold into both sides of the market, said the deputy chief executive of Securities & Futures Commission of Hong Kong.
- Steam coal prices on the Bohai Bay Rim Index fell 2 yuan from week ago to 629 yuan ($100)a tonne this week, marking the sixth consecutive session of falls, which has brought prices down by a total of 11 yuan since mid-December.
--Chinese companies are becoming increasingly confident in venturing overseas to expand trade and cement their prescence on a global scale, a private survey showed. About four in every five international Chinese companies surveyed by HSBC plan to boost overseas expansion, according to the survey.
--China will continue testing and expand the trial run of the new 4G network technology that allows 10-20 times faster internet access, the industry's top regulator said.
CHINA DAILY (www.chinadaily.com.cn)
--The yuan-denominated business of two major Chinese banks - Industrial and Commercial Bank of China Ltd and Bank of China Ltd - surged in 2012 as global demand for the currency increased.
--China's first locally manufactured, battery-powered vehicle has been handed over to its buyer in Shanghai.
Fly On The Wall 7:00 Market Snapshot
ASML (ASML) upgraded to Buy from Neutral at BofA/Merrill
Autodesk (ADSK) upgraded to Outperform from Sector Perform at RBC Capital
Bed Bath & Beyond (BBBY) upgraded to Outperform from Perform at Oppenheimer
CSX (CSX) upgraded to Outperform from Sector Perform at RBC Capital
Cubist (CBST) upgraded to Hold from Sell at Cantor
Dillard's (DDS) upgraded to Outperform from Neutral at Credit Suisse
Emerson (EMR) upgraded to Buy from Hold at Deutsche Bank
Gol Linhas (GOL) upgraded to Buy from Neutral at Goldman
Netflix (NFLX) upgraded to Buy from Neutral at Lazard Capital
Netflix (NFLX) upgraded to Market Perform from Underperform at Raymond James
Netflix (NFLX) upgraded to Neutral from Underperform at Macquarie
Netflix (NFLX) upgraded to Overweight from Neutral at JPMorgan
Ross Stores (ROST) upgraded to Outperform from Neutral at Credit Suisse
Tenet Healthcare (THC) upgraded to Outperform from Market Perform at Raymond James
Torchmark (TMK) upgraded to Buy from Neutral at SunTrust
Albermarle (ALB) downgraded to Hold from Buy at Deutsche Bank
Albermarle (ALB) downgraded to Neutral from Buy at Citigroup
Allegheny Technologies (ATI) downgraded to Neutral from Buy at Goldman
Altera (ALTR) downgraded to Market Perform from Outperform at William Blair
Apple (AAPL) downgraded to Hold from Buy at Jefferies
Apple (AAPL) downgraded to Sector Perform from Outperform at Scotia Capital
Coach (COH) downgraded to Neutral from Buy at ISI Group
Copa Holdings (CPA) downgraded to Neutral from Buy at Goldman
Douglas Dynamics (PLOW) downgraded to Neutral from Outperform at Credit Suisse
Energizer (ENR) downgraded to Market Perform from Outperform at BMO Capital
Magnum Hunter (MHR) downgraded to Hold from Buy at Jefferies
Netflix (NFLX) downgraded to Neutral from Outperform at Credit Suisse
Parkway Properties (PKY) downgraded to Sell from Hold at Cantor
Primerica (PRI) downgraded to Reduce from Neutral at SunTrust
Redwood Trust (RWT) downgraded to Market Perform from Outperform at JMP Securities
Reinsurance Group (RGA) downgraded to Equal Weight from Overweight at Morgan Stanley
Safeway (SWY) downgraded to Underweight from Equal Weight at Barclays
Stillwater Mining (SWC) downgraded to Neutral from Outperform at Credit Suisse
Tiffany (TIF) downgraded to Hold from Buy at Canaccord
Veeco (VECO) downgraded to Neutral from Buy at UBS
Atwood Oceanics (ATW) initiated with an Overweight at Barclays
Church & Dwight (CHD) initiated with an Outperform at Credit Suisse
Clorox (CLX) initiated with an Outperform at Credit Suisse
Colgate-Palmolive (CL) initiated with an Outperform at Credit Suisse
Expedia (EXPE) initiated with a Buy at Ascendiant Capital
Kimberly Clark (KMB) initiated with an Underperform at Credit Suisse
Ocean Rig UDW (ORIG) initiated with an Overweight at Barclays
PBF Energy (PBF) initiated with an Overweight at Morgan Stanley
Pacific Drilling (PACD) initiated with an Overweight at Barclays
Procter & Gamble (PG) initiated with a Neutral at Credit Suisse
Splunk (SPLK) initiated with an Outperform at BMO Capital
Apple (AAPL) CEO Cook: Very confident in our product pipeline
Apple said changing approach to guidance
Nokia (NOK) to propose no dividend be paid for 2012
Starwood Property (STWD), Starwood Capital to acquire LNR Property LLC for $1.05B
American Airlines (AAMRQ) signed 12-year capacity purchase agreement with Republic (RJET). Republic signed an agreement with Embraer (ERJ) to purchase 47 new aircraft
Amgen (AMGN) said on track to hit upper end of 2015 revenue guidance
Said no plans to raise additional debt in 2013
SanDisk (SNDK) said positioned for strong profitability in 2013
Netflix (NFLX) said no plans to launch additional international markets in 1H13
Said more and more interested in exclusive content
Symantec (SYMC) reorganized management, will reduce middle-management workforce
United Rentals (URI) sees FY13 increase in rental rates of approximately 4.5%
Companies that beat consensus earnings expectations last night and today include:
Stanley Black & Decker (SWK), Cash America (CSH), Knight Capital (KCG), Jacobs Engineering (JEC), Teradyne (TER), Hill-Rom (HRC), Apple (AAPL), United Rentals (URI), Western Digital (WDC), Sealy (ZZ), SanDisk (SNDK), Netflix (NFLX), Stryker (SYK)
Companies that missed consensus earnings expectations include:
Cabot Microelectronics (CCMP), Logitech (LOGI), Noble Corp. (NE), F.N.B. Corp. (FNB), Energen (EGN), Hexcel (HXL), Greenhill & Co. (GHL)
Companies that matched consensus earnings expectations include:
KeyCorp (KEY), Susquehanna (SUSQ), Celadon Group (CGI), Cubist (CBST)
Last year Japan's trade deficit nearly tripled to a record $78.3B and few expect a drastic improvement anytime soon, leaving Tokyo no choice but to continue with efforts to boost the economy, the Wall Street Journal reports
Citigroup’s (C) U.S. retail and commercial banking has the highest average deposits per branch among top lenders but generates lower profits than the others. The bank is attempting to turn that around, including an upgrade of computer systems, remodel branches and make employees more accountable in what is arguably the biggest internal overhaul at Citibank in decades, the Wall Street Journal reports
Growth in China's factory sector surged to a two-year high in January as manufacturers received more local and foreign orders in an encouraging sign for the country's economic rebound. The HSBC flash purchasing managers' index (PMI) increased to 51.9 in January, the highest since January 2011 and above the 50-point level that shows accelerating growth in the sector from the previous month, Reuters reports
Japanese regulators joined the U.S. in all but ruling out overcharged batteries as the cause of recent fires on the Boeing (BA) 787 Dreamliner, which has been grounded for a week. The FAA said there are still no firm answers as to the cause and no clear timetable yet for returning the plane to flight, Reuters reports
With toxic smog engulfing Beijing and much of the rest of the country for weeks, China is considering tighter vehicle curbs and emissions standards like Europe’s. That could benefit GM (GM), Volkswagen (VLKAY) and Hyundai Motor in a market where sales are forecast to pass 20M units this year, Bloomberg reports
Building supply stocks such as USG (USG) in which Warren Buffett (BRK.A) holds a 16% stake, and Eagle Materials (EXP) that more than doubled last year look to rise further as the U.S. housing market extends its recovery, Bloomberg reports
ARIAD (ARIA) files to sell common stock
American Realty (ARCP) announces public offering of 1.5M shares of common stock
Buckeye Partners (BPL) files to sell 6M common units
KB Home (KBH) 5.5M share Secondary priced at $18.25