Frontrunning: May 15
- JPMorgan Said to Weigh Bonus Clawbacks After Loss (Bloomberg)
- Obama Says JPMorgan Loss Shows Need for Tighter Rules (Bloomberg)
- Greeks Try New Tack, Seeking Technocrat Slate (WSJ)
- Euro zone finance ministers dismiss Greek exit "propaganda" (Reuters)
- Romney’s business record under fire (FT)
- Tide Turning in Japan Deflation Fight, BOJ’s Top Economist Says (BBG)
- Euro Chiefs May Offer Leniency to Greece (Bloomberg)
- Portugal's Progress Won't Guarantee Funding (WSJ)
- EU Bank-Liquidity Bill Proceeds; U.K. May Protest (WSJ)
- Cameron pressed to boost enterprise (FT)
- Parkinson Says RBA ‘Well Placed’ to Respond to Sluggish Growth (Bloomberg)
- Largest Korea Fund to Seek More Investment Quota in China (Bloomberg)
Overnight Media Digest:
* Facebook's coming IPO has set off a frenzy of anticipation among investors. The firm raised its price range to $34 to $38 a share, resulting in a target valuation of up to $104 billion.
* Coty withdrew its $10.7 billion offer for Avon Products , concluding a high-profile effort by Coty to take over an embattled larger rival.
* JPMorgan closed ranks around CEO James Dimon ahead of a shareholder meeting and announced the departure of Ina Drew, a senior executive at the center of a trading blunder that has cost the bank more than $2 billion in losses.
* LightSquared filed for bankruptcy-court protection as a deal to keep hedge-fund manager Philip Falcone's venture from defaulting wound down.
* Best Buy's founder, Richard Schulze, will step down as chairman after an internal probe found that he didn't alert the board that CEO Dunn was allegedly having an inappropriate relationship with a female employee.
* Many large companies prohibit their executives from pledging their shares as collateral for loans. But some continue to allow it, exposing shareholders to the risk that an insider might abruptly dump stock on the market
* Coping with falling prices and weakening demand, European utility companies are struggling to remain profitable as households and businesses throttle back on energy use in what's become a protracted period of economic uncertainty in the region.
SPANISH BANKS EYE FOUR-WAY MERGER
Four Spanish savings banks are working on a merger supervised by the ministry of economy that could create the country's fifth-largest lender with assets of 270 billion euros ($346.62 billion), people close to the talks said.
FAITH FADES IN EURO ZONE FIREWALL
Fears that the euro zone's firewall will prove insufficient to shield Spain and other embattled countries against the effects of a possible disorderly Greek exit from the currency union hit European financial markets on Monday.
PAUL SMITH PLANS FRESH MOVE INTO CHINA
British fashion brand Paul Smith plans to open a 5,000 square foot flagship store in Shanghai as part of its second attempt to crack the Chinese market, five years after losses forced it to retreat from the country.
DIMON SHAKES UP JP MORGAN TOP TEAM
Jamie Dimon, chief executive of JPMorgan Chase, shook up his top management team as the bank's $2 billion trading loss claimed the scalp of Ina Drew, chief investment officer.
PLUS MARKETS TO CLOSE AFTER SALE FAILURE
Smaller companies looking to raise capital were dealt a blow on Monday when Plus Markets Group, London's exchange for small and fledgling companies, said that it would close.
BEST BUY FOUNDER TO STEP DOWN AS CHAIRMAN
Richard Schulze, Best Buy's founder and chairman, is to step down after an internal probe found he failed to tell other board members that the company's former chief executive was allegedly having an inappropriate relationship with a female employee.
Morgan Chase's $2 billion trading loss, an increased appetite for risky trading had the approval of the upper echelons of the bank, including Jamie Dimon, the chief executive, current and former employees said.
* Facebook is expected to settle on a new range of $34 to $38 a share, which would value the social network as much as $104 billion.
* The latest turmoil could signify a new round of financial instability for Europe and beyond, but could also spark a new phase of bargaining between Greece and its European lenders.
* The bankruptcy lawyer Martin J. Bienenstock acknowledged that the guaranteed long-term pay contracts given to partners were at the core of Dewey & LeBoeuf's problems.
* Chesapeake's chief executive Aubrey McClendon said asset sale delays would enable the company to bargain for better terms.
THE GLOBE AND MAIL
- Faced with increasing costs and delays associated with hearing cases, a growing number of judges are trying to drag the court system into the electronic age, including using video links to allow witnesses to testify from afar.
Reports in the business section:
- Struggling U.S. lender Ally Financial Inc is auctioning off its Canadian banking division as part of the sale of more than $30-billion (U.S.) worth of international assets as it seeks to relieve mounting financial pressure.
- Quebec's education minister and deputy premier Line Beauchamp resigned from politics Monday in a bombshell announcement that came amid months of student-related unrest.
- If European countries are not prepared to bail out fellow eurozone members, maybe they should just abandon the whole concept of a common currency, Canadian Finance Minister Jim Flaherty said.
European economic update:
- Euro-zone GDP 0.0% q/q 0.0% y/y – higher than expected. Consensus -0.2% q/q -0.2% y/y. Previous -0.3% q/q 0.7% y/y.
- Sweden Total Number of Employees 2.3% - lower than expected. Consensus 2.8%. Previous 3.1%.
- Portugal GDP -0.1% q/q -2.2% y/y – higher than expected. Consensus -1.0% q/q -3.1% y/y. Previous -1.3% q/q -0.8% y/y. Revised -2.9 y/y.
- Netherlands GDP -0.2% s.a. q/q -1.1% n.s.a. y/y – higher than expected. Consensus -0.3% s.a. q/q -1.1% n.s.a. y/y. Previous -0.6% s.a. q/q -0.6% n.s.a. y/y. Revised -0.7% s.a. q/q.
- Italy GDP s.a. and w.d.a. -0.8% q/q -1.3% y/y – lower than expected. Consensus -0.7% q/q -1.2% y/y. Previous -0.7% q/q -0.4% y/y.
- Germany GDP 0.5% s.a. q/q 1.7% n.s.a. y/y – higher than expected. Consensus 0.1% s.a. q/q 0.9% n.s.a. y/y. Previous -0.2% s.a. q/q 1.5% n.s.a. y/y.
- France CPI – EU Harmonised 0.2% m/m 2.4% y/y – lower than expected. Consensus 0.2% m/m 2.5% y/y. Previous 0.9% m/m 2.6% y/y.
- Turkey Unemployment Rate 10.4%. Previous 10.2%.
- Russia Budget Level -60.3B. Previous -121.3B. Revised -70.2B.
- Hungary GDP -1.3% s.a. q/q -0.7% y/y – lower than expected. Consensus -0.5% s.a. q/q -0.1% y/y. Previous 0.3% s.a. q/q 1.4% y/y. Revised 0.0% s.a. q/q.