Frontrunning: March 19
- Cyprus parliament ready to veto deposit tax (Reuters)
- Power still out at damaged nuclear plant in Japan (AP)
- CS' Dougan Calls Bankers Out-Earning Investors Unsustainable (BBG)
- Citi in $730 Million Pact on Debt Suits (WSJ)
- Bernanke Tightens Hold on Fed Message Against Hawks (BBG)
- India Central Bank Cuts Lending Rate (WSJ)
- ECB role in bailout comes under scrutiny (FT)
- Putin Buddy Gets $7 Billion of Deals for Sochi Olympics (BBG)
- BlackRock to Cut About 300 Jobs in Fink’s Reorganization (BBG)
- Trade, economy top agenda as China's Xi meets U.S.'s Lew (Reuters)
- Late Winter Storm Threatens Heavy Snow for Northern New England (BBG)
- China Foreign Investment Rebounds as Confidence Returns (BBG)
- Republicans differ on flexibility on taxes with Obama (Reuters)
Overnight Media Digest
* Citigroup Inc agreed to pay $730 million to settle claims that it misled investors in more than four dozen bond and preferred-stock offerings over more than two years, in the second-largest settlement of private securities litigation tied to the financial crisis.
* The rebounding housing market has helped return Fannie Mae to profitability and now might allow the government-controlled mortgage-finance company to do the once unthinkable: repay as much as $61.5 billion in rescue funds to the U.S. Treasury.
* John Malone's Liberty Media Corp is close to a deal to buy 25 percent of Charter Communications for about $2.5 billion, a move that would re-establish the media mogul as a force in the U.S. cable market.
* Federal prosecutors filed criminal charges against a former chief executive of Calpers, one of the world's largest pension funds, in connection with an alleged scheme to defraud money managers such as Apollo Global Management LLC.
* The yoga-apparel retailer Lululemon Athletica Inc's shares tumbled late on Monday after saying it has pulled some of its popular black pants from stores after a mistake by a supplier left the pants too see-through.
* Starbucks Corp has bought a 600-acre farm in Costa Rica to develop new coffee varieties and test methods to eradicate a fungal disease known as coffee rust that is vexing the industry.
* The rollout of HTC Corp's new flagship device, HTC One, is being pushed back due in part to some component shortages, executives said, a setback for the Taiwanese smartphone maker attempting to turn around its sales.
* The National Football League is teaming up with private-equity firm Providence Equity Partners in a search for ventures the two entities can jointly invest in.
* Chinese auto makers have pulled back from talks to buy Fisker Automotive Inc over a disagreement on whether to revive a loan agreement with the United States, leaving the company's future uncertain ahead of an April loan payment.
* Electronic Arts said John Riccitiello is stepping down as the videogame maker's CEO after his efforts to respond to changes in the videogame industry failed to boost the company's earnings or stock.
* Drug giant AstraZeneca Plc, seeking to invigorate a depleting drug pipeline, on Monday set out plans for a reorganization of its global research and development operations, which will include eliminating around 1,600 jobs over three years and relocating its headquarters to Cambridge, England.
Authorities in Cyprus scrambled to renegotiate the terms of a 10 billion euro bailout by looking to scrap a controversial levy on small account holders.
George Osborne is set to announce on Wednesday further public sector spending cuts and pay to shore up government finances.
Citigroup Inc has agreed to pay $730 million to settle a class action lawsuit on behalf of investors who said they were misled by the company's disclosures.
Pharmaceutical group AstraZeneca is to shift more than 1,000 jobs from George Osborne's Cheshire constituency to Cambridge as it overhauls research operations.
Royal Bank of Scotland is to invest 700 million pounds ($1.1 billion) between 2013 and 2016 in improving its branches as part of a continuing shift in focus towards its domestic lending business.
Brazilian miner Vale has doubled the estimated costs for its suspended potash project in Argentina becoming the latest miner to halt investments in the country.
The world's second-largest hedge fund Man Group is set to limit its cash bonus for its top executives to 250 percent of salary at a time when EU lawmakers are demand that fund managers' bonuses must be capped in a similar way to bankers' payouts.
Moleskine-the maker of black notebooks, launched its initial public offering roadshow on Monday seeking to value the company at up to 560 million euros ($725.65 million)
* A plan to rescue the tiny European country of Cyprus, assembled overnight in Brussels, has left financial regulators, German politicians, panicked Cypriot leaders and a disgruntled Kremlin with a bailout package that has outraged virtually all the parties.
* Citigroup Inc said on Monday that it had agreed to pay $730 million to settle a class-action lawsuit on behalf of investors who said they were misled by the company's disclosures.
* Spending on prescription drugs nationwide has been slowing for years because of the increasingly widespread use of low-cost generics. But in 2012, something unheard-of happened: money spent on prescription drugs actually dropped.
* The Walt Disney Co has an app in the works which would stream programming to the phones and tablets of cable and satellite subscribers and could become available to some subscribers this year.
* With automatic spending cuts cascading through the government, lawmakers are calling for a review of federal policies they say have allowed businesses to profit on government research with limited return for taxpayers or consumers.
* The chief executive of Electronic Arts resigned on Monday, a victim of a troubled environment for the big video game companies as well as of internal missteps.
* Federico Buenrostro, the chief executive of the California Public Employees' Retirement System, or Calpers, is charged with defrauding Apollo Global Management LLC.
* Man Group, the largest publicly traded hedge fund firm in the world, is imposing its own bonus cap for top executives. Annual cash bonuses will now be capped at 250 percent of salary, the company said in its annual report.
THE GLOBE AND MAIL
* Plans for a Toronto waterfront casino are facing a fresh challenge as undecided city councillors say they cannot support a new gaming facility without the major cash injection promised by the province's lottery agency.
* Target Corp is struggling with a problem that few retailers face: too much demand for too little inventory, risking dampening customers' enthusiasm as the U.S. discounter gets ready to open a new wave of stores.
Reports in the business section:
* Williams Energy Canada is betting a part of Alberta's future will be in plastics, announcing plans to build a facility to produce feedstock for plastics manufacturing using low-cost propane derived from the oil sands upgrading process.
* As he approaches his eighth and possibly final budget, Finance Minister Jim Flaherty will no doubt be thinking about his legacy, the last acts that will shape how he will be remembered. The air is thick with leaks, speculation and flat-out guesses of what he might have in mind: from reclaiming federal funds for job training from the provinces, to sweeping tax reform, to more prosaic measures like trimming the federal public service.
* All members of Alberta's Wildrose party are funnelling 8 percent of their salaries to charity. Opposition Leader Danielle Smith says all 17 members of her caucus are accepting no more than $145,000 a year in pay.
That's what MLAs were making before Premier Alison Redford's Tories used their majority on a committee last year to increase pay by 8 percent to $156,000.
* Even before the federal government delivers its 2013 budget, the writing is already on the wall: Limited economic growth, slower household spending and the same old rock-bottom interest rates.
Despite a hoped-for recovery in U.S. demand for homes and vehicles, Canada's biggest bank says the economy will continue to struggle without an increased push from business investment and exports - an issue that has been a sore point among public policymakers.
CHINA SECURITIES JOURNAL
- Authorities are likely to release specific regulations aimed at cooling the housing market in Beijing around the end of this month, following the central government's recent guidelines, the paper reports on its front page, citing unidentified sources.
- China is still studying plans for urbanization and has not decided on a timetable yet, Li Tie, an official with the National Development & Reform Commission, told a media conference.
SHANGHAI SECURITIES NEWS
- Yang Lei, deputy head of the oil and gas department of the National Energy Administration, told a conference that a draft of the shale gas industry development policy has been completed and relevant ministries are discussing it.
- The Dalian Commodity Exchange is collecting industry opinion on its draft proposal for the launch of egg futures, part of its efforts to accelerate the launch of new futures contracts.
CHINA BUSINESS NEWS
- Chinese commercial banks are eager to provide loans to support the new government's urbanization goals, but they have also learned lessons from recent years and plan to be careful about lending to highly indebted local government financing platforms, the paper reports on its front page, citing a series of recent interviews with bank executives.
- China's first domestically designed and manufactured jumbo cargo plane, the Yun-20, produced by Xi'an Aircraft Industry (Group) Co Ltd, is on course to enter regular service within five years following a successful test flight, the plane's chief designer said.
- China's new premier Li Keqiang had a telephone conversation with Russian Prime Minister Dmitry Medvedev before his official visit to the country. Both leaders hope the two countries will press ahead with comprehensive strategic cooperation.
Fly On The Wall 7:00 AM Market Snapshot
AMC Networks (AMCX) upgraded to Equal Weight from Underweight at Evercore
Hain Celestial (HAIN) upgraded to Buy from Neutral at Longbow
Infinera (INFN) upgraded to Neutral from Sell at Goldman
NextEra Energy (NEE) upgraded to Buy from Hold at KeyBanc
Patterson Companies (PDCO) upgraded to Buy from Neutral at UBS
eBay (EBAY) upgraded to Buy from Hold at Cantor
AGCO (AGCO) downgraded to Neutral from Buy at UBS
BHP Billiton (BHP) downgraded to Neutral from Buy at Goldman
Chesapeake (CHK) downgraded to Underperform from Neutral at Sterne Agee
Deere (DE) downgraded to Neutral from Buy at UBS
Huntington Ingalls (HII) downgraded to Fair Value from Buy at CRT Capital
Juniper (JNPR) downgraded to Sell from Neutral at Goldman
Kohl's (KSS) downgraded to Underweight from Equal Weight at Morgan Stanley
Momenta Pharma (MNTA) downgraded to Underperform from Neutral at BofA/Merrill
Pernix Therapeutics (PTX) downgraded to Hold from Buy at Cantor
RadioShack (RSH) downgraded to Neutral from Buy at BofA/Merrill
Rio Tinto (RIO) downgraded to Conviction Sell from Neutral at Goldman
Unum Group (UNM) downgraded to Neutral from Buy at BofA/Merrill
ACADIA (ACAD) initiated with a Buy at Jefferies
Boise (BZ) initiated with a Hold at KeyBanc
International Paper (IP) initiated with a Hold at KeyBanc
KapStone (KS) initiated with a Buy at KeyBanc
Pluristem Therapeutics (PSTI) initiated with a Hold at Jefferies
ProAssurance (PRA) initiated with a Neutral at Janney Capital
Realogy (RLGY) initiated with an Outperform at William Blair
RockTenn (RKT) initiated with a Hold at KeyBanc
Sarepta (SRPT) initiated with a Buy at Deutsche Bank
Yahoo! (YHOO) initiated with an Outperform at Raymond James
Blackstone (BX) considering outbidding Silver Lake for Dell (DELL), Bloomberg reports
Meredith Whitney told CNBC that Bank of America’s (BAC) stock can “easily” go to $15 per share and move into the $20s in the next 18 months
Whitney said there’s a 30% upside opportunity in the shares of Discover (DFS)
BlackRock (BLK) to cut 3%, or 300, of workforce in restructuring, Bloomberg reports
Fitch removed Equity Residential (EQR) from rating watch negative, outlook stable
Sanchez Energy (SN) acquired Eagle Ford Trend of South Texas from Hess (HES) for $265M cash
AmerisourceBergen (ABC) entered into relationship with Walgreen (WAG) and Alliance Boots
Companies that beat consensus earnings expectations last night and today include:
Omeros (OMER), Aastrom (ASTM)
Companies that missed consensus earnings expectations include:
Walter Investment (WAC), 3SBio (SSRX), Synergy Pharmaceuticals (SGYP), EnergySolutions (ES)
Companies that matched consensus earnings expectations include:
Rockwell Medical (RMTI)
- The rebounding housing market has helped return Fannie Mae (FNMA) to profitability and now might allow the government-controlled mortgage-finance company to repay as much as $61.5B in rescue funds to the U.S. Treasury, the Wall Street Journal reports
- Major Internet providers (T, VZ) appear to have talked their way out of unwanted new recommendations on cybersecurity. An original draft of a report by an advisory panel to the FCC endorsed a list of concrete suggestions for major telecommunications and cable companies to tackle the cybersecurity problem. Those measures weren't backed in the final report, which was released last night, the Wall Street Journal reports
- Rising home prices last year helped more homeowners get back above water on their mortgages in Q4, a new sign of improvement in the housing market, according to CoreLogic (CLGX) data, Reuters reports
- Europe's auto market (F, GM, FIATY) fell 10.2% last month, with sales of new vehicles falling to 829,359, according to figures from the Association of European Car Manufacturers, Reuters reports
- The two biggest U.S. equity bears in 2012--Goldman Sachs (GS) and Morgan Stanley (MS)-- see the Standard & Poor’s 500 Index gaining over 12% this year to at least 1,600, as strong economic data point to higher corporate earnings, Bloomberg reports
- Farmers from the U.S. to Australia to Europe are poised to reap the second-largest wheat crop on record as fields recover from drought and heat waves, boosting global stockpiles for the first time in four years, Bloomberg reports
Crestwood Midstream (CMLP) files to sell 4.5M shares of common units
Graphic Packaging (GPK) files to sell 25M shares of common stock
Hansen Medical (HNSN) files to sell $25M of common stock
Hawaiian Electric (HE) files to sell 6.1M shares of common stock
Holly Energy (HEP) files to sell 3.75M units for limited partners
Hospitality Properties (HPT) files to sell 10M shares of common stock
LRR Energy (LRE) announces public offering of 6M common units
Silver Bay Realty (SBY) announces common stock distribution by Two Harbors
TICC Capital (TICC) files to sell 3M shares of common stock
Two Harbors (TWO) files to sell 50M shares of common stock
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