Frontrunning: January 25
- Angela Merkel casts doubt on saving Greece from financial meltdown (Guardian)
- Germany Rejects ‘Indecent’ Call to ECB on Greece, Meister Says (Bloomberg)
- Obama Calls for Higher Taxes on Wealthy (Bloomberg)
- Fed set to push back timing of eventual rate hike (Reuters)
- Recession Looms As UK Economy Shrinks By 0.2%, more than expected (SKY)
- King Says BOE Can Increase Bond Purchases If Needed to Meet Inflation Goal (Bloomberg)
- When One Quadrillion Yen is not enough: Japan's first trade deficit since 1980 raises debt doubts (Reuters)
- Sarkozy to quit if he loses poll (FT)
- U.S. Shifts Policy on Nuclear Pacts (WSJ)
- ECB under pressure over Greek bond hit (FT)
- IMF Cuts Global Growth Forecast; Sees Recession (Bloomberg)
- Harper Builds Oil Links With China After Obama ‘Slap’ on Keystone Pipeline (Bloomberg)
- Obama plans new team to get tough on China trade (Reuters)
* U.S. President Barack Obama offered Americans a populist economic vision in the State of the Union address, seeking to draw a contrast with his eventual GOP rival.
* Apple Inc reported its first quarterly results since the death of co-founder Steve Jobs, chalking up new sales and profit records based on runaway holiday demand for the company's iPhones and iPad tablet device.
* Yahoo Inc's quarterly results showed continued deterioration of its core advertising business, giving a glimpse of the challenges new CEO Scott Thomson will face in turning around the onetime Internet giant.
* Google Inc said it would start combining nearly all the information it has on its users, which could make it harder for them to remain anonymous.
* With the chance to lead the much-anticipated IPO of Facebook, Morgan Stanley's tech team is going after an offering that is expected to raise $10 billion in what could count as one of the largest U.S. public debuts ever.
* Swiss drug giant Roche Holding AG made a hostile offer for Illumina Inc that values the DNA sequencing company at $5.7 billion, underscoring growing interest in the competitive field of gene sequencing.
* The global economy is slowing this year, the International Monetary Fund said on Tuesday, cutting its forecasts for growth and warning of a deeper downturn if Europe doesn't take stronger action to stem its debt crisis.
IMF APPLIES PRESSURE ON ECB OVER GREEK BOND HIT
The International Monetary Fund has turned up pressure on European officials to take on more of the burden of filling a widening gap in Greece's budget by pressing the European Central Bank to take a hit on its 40 billion euros ($52 billion) in Greek bond holdings, euro zone officials said. http://link.reuters.com/mez26s
S&P DOWNGRADES FRENCH BANKS
The loss of France's long-cherished triple A sovereign debt status spilt over into its banking sector on Tuesday as Standard & Poor's cut its long-term ratings for Societe Generale and Credit Agricole, two of the country's top three banks. http://link.reuters.com/nez26s
UK WATCHDOG TO PROTECT 'IRRATIONAL' INVESTORS
Investors cannot be counted on to make rational choices so regulators need to "step into their footprints" and limit or ban the sale of potentially harmful products, the head of the UK's new consumer protection watchdog said. http://link.reuters.com/pez26s
UK'S CAMERON INSISTS ON CAPPING RBS CHIEF'S BONUS
British prime minister David Cameron has insisted that the chief executive of Royal Bank of Scotland should receive a bonus of no more than 1 million pounds ($1.6 million) this year, half of last year's award, as Cameron attempts to tighten his clampdown on executive pay. http://link.reuters.com/qez26s
APPLE'S REVENUE SURGES PAST FORECASTS
The world's most valuable technology corporation Apple has blasted past Wall Street expectations, with record quarterly revenues of $46.3 billion, powered by the sale of 37 million iPhones in its December quarter. http://link.reuters.com/rez26s
UNICREDIT PLANS TO RAISE BILLION THROUGH BONDS
UniCredit is planning to raise up to 25 billion euros through the issue of so-called covered bonds as Italy's largest bank by assets seeks to open up a new stream of funding amid ongoing pressures on bank liquidity in the euro zone. http://link.reuters.com/sez26s
EU'S BARNIER PROVIDES HOPE FOR DB-NYSE MERGER
Deutsche Borse and NYSE Euronext have been given some hope of mustering support to save their merger after Europe's leading financial regulator moved to reserve his right to oppose a recommendation to block the tie-up of the German and U.S. exchange operators. http://link.reuters.com/tez26s
QUINDELL TO BUY LAW FIRM
Quindell Portfolio, an AIM-traded outsourcing company, is to become the first quoted company to invest in the legal market under new legislation, paying 19.3 million pounds for a law firm specialising in personal injury. http://link.reuters.com/vez26s
MCDONALD'S TWITTER CAMPAIGN HIJACKED
Critics of McDonald's have turned the fast-food chain's advertising campaign on Twitter against itself, unleashing a torrent of abusive tweets, in the latest example of how social media marketing can backfire. http://link.reuters.com/wez26s
EURO ZONE LEADERS MUST OFFER 'INCENTIVES', SAYS WORLD BANK
Germany and its European partners should widen the proposed fiscal pact with "incentives" for euro zone countries that are implementing fiscal and structural reforms, the president of the World Bank wrote in the Financial Times on Wednesday. http://link.reuters.com/fuz26s
* As European banks move to shed businesses and write off losses, their regulators might veto any steps they fear could inflict further damage.
* Tentative talks begin in effort to prevent the European Central Bank from having to take a loss on its 55 billion-euro portfolio of Greek bonds.
* A safety consulting firm accused the National Highway Traffic Safety Administration of holding back evidence that electronic systems in Toyota Motor Corp vehicles were causing unintended acceleration.
* Apple Inc reported on Tuesday that its profit for the holiday quarter more than doubled. And that was largely thanks to sales of the iPhone 4S, which, when it was introduced in October, was greeted with grumbling from pundits and some users for lacking the razzle-dazzle that many imagined an iPhone 5 would bring.
* Roche, the Swiss drug company, made the hostile bid for Illumina, a provider of genetic analysis services, after months of failed efforts to begin deal talks.
* Prosecutors say the Texas financier Allen Stanford treated the savings of thousands of investors as his "personal piggy bank" to live a life of luxury on the Caribbean island of Antigua.
* Republican US presidential candidate Mitt Romney on Tuesday released documents that show he and his wife had an effective federal tax rate in 2010 of 13.9 percent.
* Donald Drapkin, a millionaire, is suing Ronald Perelman, a billionaire who was once a best friend, for millions of dollars he claims he was owed after he left Perelman's company.
European Economic Data
- UK BBA Loans for House Purchase 36,171 – higher than expected. Consensus 35,000. Previous 34,738. Revised 34,809.
- UK GDP -0.2% q/q 0.8% y/y – lower than expected. Consensus -0.1% q/q 0.8% y/y. Previous 0.6% q/q. 0.5% y/y.
- UK Index of Services 0.6% m/m 0.1% 3mth/3mth – higher than expected. Consensus 0.4% m/m -0.1% 3mth/3mth. Previous -0.7% m/m 0.2% 3mth/3mth. Revised -0.6% m/m.
- UK CBI Trends Total Orders -16 – higher than expected. Consensus -23. Previous -23.
- UK CBI Trends Selling Prices 13 – higher than expected. Consensus 3. Previous 7.
- Spain Producer Prices -0.1% m/m 5.2% y/y – in line with expectations. Consensus -0.1% m/m 5.2% y/y. Previous 0.2% m/m 6.3% y/y.
- Netherlands Producer Confidence -1.4 – higher than expected. Consensus -2.0. Previous -1.3.
- Italy Retail Sales s.a. -0.3% m/m – lower than expected. Consensus -0.2% m/m. Previous 0.1% m/m. Revised 0.2%.
- Italy Retail Sales -1.8% y/y – lower than expected. Consensus -1.5% y/y. Previous -1.5% y/y. Revised -1.4% y/y.
- Germany IFO Business Climate 108.3 – higher than expected. Consensus 107.6. Previous 107.2. Revised 107.3.
- Germany IFO – Current Assessment 116.3 – lower than expected. Consensus 116.8. Previous 116.7.
- Finland Retail Sales Volume 1.8% y/y – lower than expected. Consensus 2.5% y/y. Previous 1.9% y/y.
- Romania Money Supply 6.3% y/y. Previous 5.6% y/y.
- Hungary Retail Trade (IA) 1.1% y/y – higher than expected. Consensus -0.1% y/y. Previous 0.6% y/y.