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Frontrunning: May 11

Tyler Durden's picture





 
  • China Industrial Output Growth Slows Sharply In April (WSJ)
  • Indian industrial output shrinks unexpectedly (AFP)
  • China’s Inflation Moderates, Adding Room for Easing (Bloomberg)... a nickel for every "imminent RRR-cut" prediction
  • Drew Built 30-Year JPMorgan Career Embracing Risk (Bloomberg)
  • Spain Offered Time to Curb Deficit (FT)
  • France Entrepreneurs Flee From Hollande Wealth Rejection (BBG)
  • Venizelos Eyes Unity Deal After Agreement With Democratic Left (Ekathimerini)
  • Berlin Reaches Out to the Periphery (FT)
  • Bernanke Speaks About Risks From End of Pro-Growth Plans (Bloomberg)
  • ANZ Cuts Rates by 37 Basis Points (The Age)
  • A Cautionary Tale of Inflation and Growth (Mark Carney)
  • Obama Winning Investors by 49%-38% Against Romney in Poll (Bloomberg)

Overnight media Summary

WSJ

 

* JPMorgan has taken $2 billion in trading losses in the past six weeks and could face an additional $1 billion in second-quarter losses due to market volatility.

* Morgan Stanley asked the hedge fund firm being closed down by the securities firm's former co-president, Zoe Cruz, for its money back.

* Warren Buffett's Berkshire Hathaway emerged as a major backer of Coty's bid for struggling beauty company Avon, but Berkshire's support had the unexpected effect of signaling the deal might never come together.

* China has told the Big Four auditors to hand over control of Chinese operations to local partners, amid tensions over auditing problems.

* Procter & Gamble is moving its global beauty, skin, cosmetics and personal-care unit to Singapore from Cincinnati.

* Prime Minister Mario Monti is jockeying to position Italy as a mediator between Germany and weaker euro-zone economies, an effort ultimately aimed at broadening Europe's decision-making beyond the traditional Franco-German axis that has so far called the shots in fighting the crisis.

* T-Mobile USA said it lost more than a half million of the most lucrative customers in the first quarter, casting doubt on whether the company can regain momentum after regulators blocked its sale to AT&T Inc.

* Google is gearing up for a possible FTC fight, funding analysis by third-party lawyers and economists to make the case that its activities don't violate antitrust law.

FT
 

MITTAL URGES 'BUY EUROPEAN' PROGRAMME

Lakshmi Mittal has called on European political leaders to back a "buy European" industrial programme as part of an effort to boost the continent's economy, as an alternative to austerity measures which he said were "not working".

QATARI'S TARGET BUILDING XSTRATA STAKE

Qatar's sovereign wealth fund plans to buy at least 10 percent of Xstrata as part of a long-held strategy to invest in Glencore, suggesting the Gulf state could provide crucial support to the pair's $90 billion merger deal.

SPAIN OFFERED TIME TO CURB DEFICIT

Spain will be offered more time to hit the budget deficit targets it agreed with the EU but only if Madrid meets new conditions, including an independent audit of the restructuring plan for its troubled banks.

HANDS TO PUT 20 MILLION INTO TERRA FIRMA

Guy Hands, the financier, is ploughing 20 million pounds ($32.32 million) of his own money into his underperforming private equity fund in an unusual move to retain his best dealmakers as revenues fall.

FACEBOOK INSTAGRAM DEAL DELAY THREAT

A competition probe into Facebook's $1 billion acquisition of photo-sharing service Instagram threatens to postpone the closure of the deal beyond the second quarter, the target set by the company in its initial public offering documents.

PRU CHIEF IN LINE TO BE ABI CHAIRMAN

Tidjane Thiam, chief executive of Prudential, has emerged as a leading candidate to replace his counterpart at Legal & General as chairman of the Association of British Insurers.

BOC CARNEY SAYS EXTREME POLICY IS NOT THE WAY FORWARD

Bank of Canada Governor Mark Carney said on Friday that now is not the time for central banks to abandon frameworks that "have proved their worth" with "low-for-long" policies.

 

NYT
 

* JPMorgan Chase, which emerged from the financial crisis as the nation's biggest bank, disclosed on Thursday that it had lost more than $2 billion in trading, a surprising stumble that promises to escalate the debate over whether regulations need to rein in trading by banks. http://r.reuters.com/pym28s

* Government advisers recommended approval on Thursday of a weight-loss drug developed by Arena Pharmaceuticals, making it likely that a new obesity treatment will reach the market this year. http://r.reuters.com/xym28s

* It was a little over a decade ago that William Loomis stepped down as the chief executive of Lazard, having served in that role for only a year. Now Loomis is back, in a more limited capacity. http://r.reuters.com/fan28s

* Coty on Thursday raised its takeover bid for Avon Products to $10.7 billion and unveiled a potent new weapon: Warren Buffett. Among Coty's newest backers is Berkshire Hathaway, the conglomerate that Buffett runs and one of the best-regarded companies in the country. http://r.reuters.com/han28s

 

Canada

THE GLOBE AND MAIL

- The Auditor General's office is cutting 10 per cent of its staff - or 60 jobs - and other parts of government are scrapping a wide range of reports to Parliament, according to the latest details on spending cuts provided by officials.

Reports in the business section:

- MacDonald Dettwiler and Associates Ltd's criticism of the Conservative government comes four years after Ottawa surprised investors by blocking the company from selling its space technology division to Minneapolis-based Alliant Techsystems Inc, saying the unit was of strategic interest to Canada.

- Frank Stronach was absent from the annual meeting of Magna International Inc for the first time since the company started holding them 50 years ago, but Chief Executive officer Don Walker is taking up arms in the company's decades-long battle with institutional investors.

NATIONAL POST

- A Toronto Islamic school's teaching materials, which have prompted a police hate crimes investigation because of their portrayal of Jews, were originally published by Iranian organizations, records show.

FINANCIAL POST

- China's growing influence in oil sands development might be the most important issue facing Canada's energy sector that nobody is talking about.

- Canadian Tire Corp's Chief Executive Stephen Wetmore did not mention Target Corp explicitly at the annual shareholder's meeting in Toronto on Thursday, but the U.S. retailer's arrival loomed large in a speech that played heavily upon the company's national heritage.

European Economic News:

  • UK Nationwide Consumer Confidence 44. Previous 53.
  • Germany CPI (EU Harmonised) 0.1% m/m 2.2% y/y – lower than expected. Consensus 0.2% m/m 2.2% y/y. Previous 0.2% m/m 2.2% y/y.
  • Switzerland PES Unemployment Rate 4.3% - lower than expected. Consensus 4.4%. Previous 4.5%.
  • Spain CPI (EU Harmonised) 1.1% m/m 2.0% y/y – in line with expectations. Consensus 1.1% m/m 2.0% y/y. Previous 2.2% m/m 2.0% y/y.
  • UK PPI Output Core 0.6% m/m 2.3% y/y. Consensus 0.2% m/m 1.9% y/y. Previous 0.1% m/m 2.5% y/y.
  • Europe: European Commission Releases Economic Growth Forecasts Euro Area Growth: -0.3% 2012, 1.0% 2013.
 


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Fri, 05/11/2012 - 08:19 | Link to Comment Catullus
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* Warren Buffett's Berkshire Hathaway emerged as a major backer of Coty's bid for struggling beauty company Avon, but Berkshire's support had the unexpected effect of signaling the deal might never come together.

Adding that Uncle Warren was the only one dumb enough to throw money down an MLM pyramid scheme.

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