- Japan’s Stocks Correction Raises Stakes for Abe’s Growth Plan (BBG)
- China Failure to Grow With $1 Trillion Is Warning to Li (BBG)
- Blankfein Leads Bank CEO Pay With $26 Million Deemed Overpaid (BBG)
- IMF says ‘no evidence yet’ of Abenomics hurting other economies (FT)
- Europe Seeks CFTC Delay in Imposing Swaps Rules on Banks (BBG)
- Fed's Rosengren: 'Modest' QE3 cut may make sense in a few months (Reuters)
- Who’s who of Obama lobbyists pushes Keystone pipeline (FT)
- China to Study Joining U.S.-Led Trade Accord After Japan Added (BBG)
- Easing of deficit rules exposes rifts in Italy’s government (FT)
- Oil Fields Under Olive Groves Offer Italy Economic Boost (BBG)
- Volcker warns on limits of Fed's easy money (Reuters)
- Berkshire’s Abel Builds Buffett Energy Unit With Purchase (BBG)
Overnight Media Digest
* David Petraeus, the former U.S. Army general who resigned last year as CIA chief, is rebooting his career with KKR , the giant private-equity firm.
* China's largest meat processor struck a surprise $4.7 billion agreement to buy Smithfield Foods, a deal that would mark the biggest Chinese takeover of an American company.
* Berkshire Hathaway's MidAmerican Energy unit plans to buy Nevada utility NV Energy Inc for about $5.6 billion in cash, a sign that Warren Buffett's corporate empire is betting on the recovery of a state hit hard by the recession.
* Blackstone is planning to withdraw close to $400 million from embattled hedge fund firm SAC Capital Advisors LP, potentially twice as much as earlier expected.
* The U.S. government won a victory against tax cheats with offshore bank accounts after Swiss officials agreed on Wednesday to let banks release information on the overall holdings of their American clients.
* The Obama administration is set to announce on Thursday that its signature consumer-mortgage modification initiative, due to expire at the end of the year, will be extended for two more years.
Berkshire Hathaway Inc agreed to pay $5.6 billion for NV Energy Inc, the electric utility serving Las Vegas and its power-hungry casinos, saying the deal would help in the development of Nevada's renewable energy resources.
Investors of the group that controls the Empire State Building have approved a plan to take the New York skyscraper public for $1 billion.
Britain's finance ministry closed down a 900 million-pound tax loophole on Wednesday by blocking gas and electricity distribution companies from claiming capital allowances off their tax bills against costs dating back decades.
Gavin O'Reilly, who was ousted as chief executive of Independent News & Media last year, has been appointed as head of The Agency Group, a booking agency for stars such as De La Soul and Dolly Parton.
China's Shuanghui Group has agreed to buy Smithfield Foods Inc for around $4.7 billion in cash, in what will be the largest Chinese takeover of a U.S. company if completed.
Nasdaq OMX on Wednesday agreed to pay $10 million, the largest penalty ever levied against a stock exchange, to settle civil charges stemming from mistakes during the launch of Facebook Inc's $16 billion initial public offering last year.
* A Chinese takeover of a large American pork producer has prompted concern about China's expanding role in the American food supply and the implications that might have for food safety.
* Internal documents offer a glimpse into the Obama administration's decision-making as it weighed action against two British banks over money laundering.
* Experts say there are hundreds of Internet payment systems that do not require users to identify themselves, making it difficult to seize on money laundering operations.
* The European Central Bank warned on Wednesday that the euro zone's slumping economy and a surge in problem loans were raising the risk of a renewed banking crisis, even as overall stress in the region's financial markets had receded.
* Women are not only more likely to be the primary caregivers in a family. Increasingly, they are primary breadwinners, too. Four in 10 American households with children under age 18 now include a mother who is either the sole or primary earner for her family, according to a Pew Research Center analysis of Census and polling data released on Wednesday. This share, the highest on record, has quadrupled since 1960.
* The Obama administration issued a rule that employers could reward or penalize employees who meet specific standards related to their health.
THE GLOBE AND MAIL
* Toronto's embattled mayor Rob Ford tried to talk about the city's response to a major event - overnight flooding that shut down rush hour traffic on the Don Valley Parkway - but instead faced a barrage of questions about the scandal that has engulfed his administration in the past two weeks. Ford refused to respond to questions related to allegations about crack cocaine use, or reports that a member of his staff tried to have the e-mail and phone records of three former employees destroyed.
* Quebec mining companies are reeling over proposed legislation that would require them to produce studies on the feasibility of processing ore in the province before proceeding with a new project. The requirement is part of the new Mining Act tabled on Wednesday, in which the Parti Quebecois minority government is seeking to maximize the economic spin-offs from major new mining projects.
Reports in the business section:
* Rogers Communications Inc has struck a deal to buy wireless spectrum in greater Toronto from Quebecor Inc's Videotron unit for C$180 million ($173 million). The purchase adds pressure to the federal government as it considers how to advance its policy of creating more competition in the wireless sector. The government sold spectrum - publicly owned radio waves used by mobile carriers to transmit phone calls and data - to Quebecor and other companies in 2008 in order to create alternatives to the three primary players in the industry: Rogers, BCE Inc and Telus Corp.
* Canada's largest cities are overspending three times faster than their populations are growing, says a new report. In Big City Spenders released on Wednesday, the Canadian Federation of Independent Business says Canada's three largest cities - Toronto, Montreal and Vancouver - are headed for financial crisis if they continue to shell out money they don't have.
* Quebec's Jimmy Cournoyer does two things well: selling enormous quantities of illegal drugs at astounding profit and minimizing his punishment when caught. Both talents were on display on Wednesday as he stood in a New York courtroom admitting he was the mastermind of a C$1 billion ($961.9 million) network that flooded the United States with Canadian marijuana and Canada with Mexican cocaine.
* Quebec's main business lobby issued its strongest warning yet about economic development in the province, saying if Enbridge Inc's Line 9 pipeline reversal proposal doesn't see the light of day there's little hope for any other significant project.
* The Bank of Canada will probably begin raising interest rates in the second half of 2014 to contain inflation as the job market tightens, according to the Organization for Economic Co-operation and Development. Inflation will rise to 1.7 percent by the end of next year from 0.9 percent in 2013, the OECD predicted in a report released on Wednesday. The unemployment rate is forecast to fall to 6.7 percent as the economy nears its potential amid a weaker currency. ()
CHINA SECURITIES JOURNAL
-- A one-year subsidy program for energy-efficient home appliances will expire on Saturday, the Ministry of Finance said. The program, which offered subsidy of between 100 and 400 yuan ($16.18 to 64.72) for every appliance sold, covered five categories of energy-saving appliances, including air conditioners, flat-panel TVs, refrigerators, washing machines and water heaters.
SHANGHAI SECURITIES NEWS
-- China Securities Financing Corp Ltd, which lends money and stocks to brokerages for margin financing and short selling businesses, plans to raise 17.3 billion yuan in a fresh round of fundraising. The expanded capital base could potentially channel an additional 172.5 billion yuan into the stock market.
-- China's coal mining industry output and investment fell in the first four months of this year, data from the China National Coal Association showed. Output from January to April totalled 1.15 billion tonnes, down 2 percent from the same period last year, while fixed-asset investment in the coal mining industry declined 6.6 percent. Revenues of the country's major coal producers in the first quarter fell 2.6 percent from the same period last year and their profits dropped 40.3 percent.
-- Measures taken against H7N9 bird flu will not be changed despite cases showing the virus was proving resistant to the recommended treatment with Tamiflu or similar antiviral drugs, a senior health official said.
-- China's public security bureau is stepping up its crackdown on illegal sales of private information, having caught 4115 suspects over the past year, involving the sale of nearly 5 billion pieces of personal information.
Fly On The Wall 7:00 AM Market Snapshot
Canadian Pacific (CP) upgraded to Hold from Sell at Canaccord
Cracker Barrel (CBRL) upgraded to Neutral from Underperform at BofA/Merrill
Diamond Offshore (DO) upgraded to Overweight from Neutral at JPMorgan
Facebook (FB) upgraded to Buy from Hold at Jefferies
Facebook (FB) upgraded to Outperform from Market Perform at BMO Capital
First Solar (FSLR) upgraded to Buy from Neutral at Goldman
Fusion-io (FIO) upgraded to Outperform from Neutral at Credit Suisse
MEMC Electronic (WFR) upgraded to Conviction Buy from Buy at Goldman
Noble Corp. (NE) upgraded to Outperform from Market Perform at Raymond James
Statoil (STO) upgraded to Neutral from Underperform at Credit Suisse
SunPower (SPWR) upgraded to Neutral from Sell at Goldman
Volcano (VOLC) upgraded to Outperform from Market Perform at JMP Securities
Autonation (AN) downgraded to Sell from Neutral at UBS
Baker Hughes (BHI) downgraded to Underweight from Equal Weight at Morgan Stanley
Carnival (CCL) downgraded to Underperform from Neutral at Exane BNP Paribas
Dean Foods (DF) downgraded to Market Perform from Outperform at BMO Capital
Halliburton (HAL) downgraded to Underweight from Equal Weight at Morgan Stanley
KKR & Co. (KKR) downgraded to Market Perform from Outperform at BMO Capital
Kraton Performance (KRA) downgraded to Neutral from Buy at SunTrust
Noble Corp. (NE) downgraded to Neutral from Overweight at JPMorgan
PacWest Bancorp (PACW) downgraded to Market Perform from Outperform at Keefe Bruyette
Qlik Technologies (QLIK) downgraded to Hold from Buy at Drexel Hamilton
Sonic Automotive (SAH) downgraded to Sell from Neutral at UBS
TECO Energy (TE) downgraded to Sell from Neutral at UBS
ABM Industries (ABM) initiated with a Buy at Jefferies
Allergan (AGN) coverage resumed with a Buy at SunTrust
Bright Horizons (BFAM) initiated with a Buy at Jefferies
Bristol-Myers (BMY) initiated with a Buy at SunTrust
Cintas (CTAS) initiated with a Buy at Jefferies
Eli Lilly (LLY) initiated with a Buy at SunTrust
Forest Labs (FRX) initiated with a Neutral at SunTrust
Hersha Hospitality (HT) initiated with an Equal Weight at Evercore
Himax Technologies (HIMX) initiated with an Outperform at Oppenheimer
Host Hotels (HST) initiated with an Overweight at Evercore
Hyatt Hotels (H) initiated with an Equal Weight at Evercore
LaSalle Hotel (LHO) initiated with an Equal Weight at Evercore
Lexicon Pharmaceuticals (LXRX) initiated with a Buy at Jefferies
Marriott (MAR) initiated with an Overweight at Evercore
Merck (MRK) initiated with a Neutral at SunTrust
Mistras (MG) initiated with a Neutral at DA Davidson
Pfizer (PFE) initiated with a Reduce at SunTrust
Rollins (ROL) initiated with a Buy at Jefferies
Shire (SHPG) initiated with a Neutral at SunTrust
Starwood Hotels (HOT) initiated with an Overweight at Evercore
Strategic Hotels (BEE) initiated with an Equal Weight at Evercore
Sunstone Hotel (SHO) initiated with an Overweight at Evercore
The Pantry (PTRY) initiated with an Equal Weight at Stephens
Vail Resorts (MTN) initiated with an Equal Weight at Evercore
Watsco (WSO) initiated with a Neutral at Longbow
eMagin (EMAN) initiated with a Perform at Oppenheimer
NV Energy (NVE) to be acquired by MidAmerican (BRK.A) for $23.75 per share
DISH (DISH) offered $4.40 per share in cash for Clearwire (CLWR)
DISH (DISH) said national security issues of Softbank (SFTBF), Sprint (S) deal not addressed
Moody's cut Alcoa's (AA) ratings to 'Ba1' from 'Baa3', outlook stable
KKR (KKR) named General Petraeus chairman of KKR Global Institute
TransCanada (TRP) CEO Girling told CNBC that Keystone should be operational mid-late 2015 Said extra costs of Keystone not insignificant
priceline.com (PCLN) announced $1B share repurchase plan
AIG (AIG), People's Insurance Company of China and PICC Life Insurance Co. formed JV
Morgans Hotel (MHGC) board voted to eliminate 'poison pill'
GlaxoSmithKline (GSK) confirmed FDA approval of Tafinlar and Mekinist
Companies that beat consensus earnings expectations last night and today include: Sanderson Farms (SAFM), Joy Global (JOY), Costco (COST), Frontline (FRO), ATA Inc. (ATAI), Avago (AVGO), Tilly's (TLYS)
Companies that missed consensus earnings expectations include:
Yingli Green (YGE), Descartes Systems (DSGX)
Companies that matched consensus earnings expectations include:
Big Lots (BIG), AFC Enterprises (AFCE), Acquity Group (AQ)
- Morgan Stanley (MS) told investors that its underperforming fixed-income unit will have to be a lot smaller than rivals' businesses in order to earn decent profits. The shift marks a twist in the firm’s decade long struggle to become a force in the trading of bonds, currencies and commodities, the Wall Street Journal reports
- Monday's deadline for clients of SAC Capital Advisors LP to say whether they want money back from the hedge-fund firm is turning into a bigger cliffhanger. The company's largest outside investor, Blackstone Group (BX), plans to withdraw about $400M, or potentially twice as much as expected earlier this month, sources say, the Wall Street Journal reports
- Key banks (C, NMR, RBS, UBS, BNPQY), brokerages and high-frequency trading firms are backing a new London derivatives market set up by Nasdaq OMX (NDAQ), which the exchange is launching to shake up competition in trading European interest-rate products, Reuters reports
- Sales of U.S. homes in foreclosure fell in Q1, RealtyTrac says, the latest data to suggest the housing market is on the mend, Reuters reports
- Fiat SpA (FIATY) is in talks for as much as $10B in financing from a pool of banks (BAC, DB, GS, BNPQY) to buy the 41.5% Chrysler Group LLC stake it doesn’t own and refinance the two automakers’ debt, sources say, Bloomberg reports
- Ford Motor (F) is rolling out smaller utilities to more markets worldwide, betting that growth of recent years will continue, Bloomberg reports
Boardwalk Pipeline (BWP) to offer 11M common units representing limited partners
Boston Private Financial (BPFH) files to sell 3.9M shares for holders
First Bancshares (FBMS) files to sell 1.95M shares for holders
Oncothyreon (ONTY) raises $10M in a registered direct offering
Teekay Offshore Partners (TOO) to offer $100M of common units for limited partners
Vanguard Natural (VNR) to offer 7M common units representing limited partners