- Fed Pushes Into ‘Uncharted Territory’ With Record Assets (BBG)
- Next up in the currency wars: Korea - Samsung Drops on $2.8 Billion Won Profit-Cut Prediction (BBG)
- China Warns ‘Hot Money’ Inflows Possible on Easing From Abroad (Bloomberg)
- BOJ Shirakawa affirms easy policy pledge but warns of costs (Reuters)
- Merkel Takes a Swipe at Japan Over Yen (WSJ)
- Wages in way of Abe’s war on deflation (FT)
- Italian PM under fire over bank crisis (FT)
- Senior officials urge calm over islands dispute (China Daily)
- Spain tries to peel back business rules (FT)
- Rifts Over Cyprus Bailout Feed Broader Fears (WSJ)
- Soros Says the Euro Is Here to Stay as Currency War Looms (BBG)
- Deutsche Bank Debt Salesmen Said to Go Amid Pay Overhaul (BBG)
- Cameron pitches new deal as good for EU (FT)
Overnight Media Digest
* U.S. President Barack Obama nominated a former prosecutor turned white-collar criminal defender, Mary Jo White, as his choice for top U.S. securities regulator.
* Microsoft's quarterly earnings slipped 3.7 percent as the software giant reported weaker sales in its business and entertainment divisions, though revenue in its core Windows business strengthened.
* Citigroup Inc's private bank has decided to pull its $187 million investment from SAC Capital Advisors LP, the latest in a string of client defections that have occurred amid scrutiny of the hedge-fund firm.
* JP Morgan will not be trying 'staple financing' in the potential Dell deal, a possible ramification of a court decision criticizing what was once a common practice on Wall Street.
* Samsung Electronics Co on Friday said its fourth-quarter profit rose 76 percent to a record high on strong smartphone sales and higher margins in its chip business.
* Morgan Stanley Chairman and Chief Executive James Gorman is expected to take a second straight annual pay cut for 2012, as the securities firm continues to struggle to get back on track.
* Casino operator Las Vegas Sands Corp has stopped executing international money transfers for its high-rolling customers and is overhauling its compliance procedures as it faces scrutiny from U.S. and international regulators, people familiar with the matter said.
* Bristol-Myers Squibb Co agreed to pay $80 million to settle cases involving 15 patients killed or hurt during company-sponsored testing of an experimental drug for hepatitis C.
BARCLAYS EXECUTIVES FACE MOUNTING LIBOR PRESSURE Top executives at Barclays were aware the bank was manipulating its submissions to Libor rate-setting panel in November 2011, almost a year earlier than previously disclosed, emails suggested. (link.reuters.com/tud55t)
OSBORNE STICKS TO AUSTERITY PLAN Finance minister George Osborne will not be diverted from his austerity plan even if data on the strength of British economy disappoints. (link.reuters.com/xud55t)
GOVERNMENT TO DELIVER CHILDCARE BOOST Britain's coalition government is planning to spend 1.5 billion pounds on a package of measures to help families cope with nursery fees. (link.reuters.com/vud55t)
FEARS RAISED OVER ECB FUNDING SCHEME Senior bankers are becoming increasingly concerned about the European Central Bank's special longer-term funding scheme, saying that it could encourage the creation of a two-tier banking market. (link.reuters.com/dyd55t)
RETAILERS MAKE APPEAL ON TAX AVOIDANCE High street retailers said the government needed to take action to stop tax avoidance by multinational companies. (link.reuters.com/bed55t)
RIM BOOSTED BY LENOVO INTEREST Lenovo has signalled it could be interested in buying Research In Motion, lifting the shares in the troubled Canadian maker of BlackBerry smartphones
* U.S. President Barack Obama tapped Mary Jo White, a former United States attorney turned white-collar defense lawyer, to lead the Securities and Exchange Commission. He also renominated Richard Cordray as director of the Consumer Financial Protection Bureau.
* Jill Sommers, a Republican regulator overseeing the investigation into MF Global's collapse, has abruptly decided to depart the Commodity Futures Trading Commission, the agency said.
* After a year of mixed financial performance at Morgan Stanley, the firm's chief executive, James Gorman, is expected to take a second annual pay cut.
* AT&T sold a record number of smartphones over the holiday season, but its quarterly earnings took a hit from pension costs and Hurricane Sandy.
* Microsoft's biggest product in decades, Windows 8, helped lift sales of the company's flagship operating system business, but not enough to rejuvenate overall growth.
* Greenhill reported a 4 percent drop in advisory revenue last year, a week after larger rivals JPMorgan Chase & Co and Morgan Stanley posted much larger declines.
* HCA Holdings, the largest profit-making hospital chain in the United States, was ordered to pay $162 million after a judge ruled that it had failed to abide by an agreement to make improvements to dilapidated hospitals that it bought in the Kansas City area several years ago.
* A federal appeals court in the United States tossed out $172 million in damages that Mattel had been ordered to pay MGA Entertainment, the maker of Bratz dolls. It was the latest move in a bitter nine-year legal dis
THE GLOBE AND MAIL
* An executive from a Quebec engineering firm has testified that many of the province's top engineering companies, including the troubled giant SNC Lavalin Group Inc, colluded to pay political kickbacks and to win fixed construction contracts.
Michel Lalonde, the president of Genius Conseil, told Quebec's construction inquiry on Thursday that a list of top companies were complicit in the scheme to secure road and sewer design and construction surveillance contracts by sending bribes and kickbacks to the political party headed by the city's mayor.
* Shawn Atleo, national chief of Assembly of First Nations, said any divisions in the aboriginal community are trumped by shared objectives, including ending "the status quo", and that many of the community's goals are similar to those of the rest of Canadians.
Reports in the business section:
* Talisman Energy Inc plans to slash its general and administrative (G&A) costs by "at least 20 per cent over all", Helen Wesley, the company's executive vice president of corporate services, told the CIBC Whistler Institutional Investor Conference on Thursday.
* Agrium Inc raised its fourth-quarter earnings estimate based on robust grain and oilseed prices that are helping boost demand for its fertilizers and other products. The Calgary-based company said it expects fourth-quarter earnings to be slightly above C$2 per share, compared with its previous guidance of C$1.50 to C$1.90.
* Facing drastically falling oil revenue, Alberta Premier Alison Redford set the stage for serious spending cuts and possible tax hikes during a televised fireside chat on Thursday.
Redford blamed a "bitumen bubble" and warned Albertans about austere times to come. The government has forecast a deficit in the current fiscal year of C$3 billion.
* At least one Calgary oil executive is appealing to Canadian pocket books as the U.S. state department decides the fate of TransCanada Corp's Alberta-to-Texas Keystone XL pipeline. Export constraints on Alberta heavy oil production are costing each Canadian C$1,200 per year, Cenovus Energy Inc CEO Brian Ferguson said on Thursday.
* Canadian wireless carriers must make changes to their networks and systems to support 911 emergency text messages from hearing and speech impaired persons, the federal telecom regulator said on Thursday. The service would only be provided to the hearing and speech impaired who have pre-registered for it with their wireless carrier, the Canadian Radio-television and Telecommunications Commission (CRTC) said.
CHINA SECURITIES JOURNAL
-- China will build six control standards, including PM2.5, in 113 cities and will release the monitoring data before the end of December this year, Environment Minister Zhou Shengxian said.
-- The number of Chinese mobile phone users reached 1.11 billion as of the end of 2012, according to Ministry of Industry and Information Technology data released on Thursday.
-- China Financial Futures Exchanges has approved the application of account opening from several QFII institutions.
CHINA DAILY (www.chinadaily.com.cn)
-- Alibaba Group Holdings, China's largest e-commerce company, plans to join hands with partners to build a logistics network across China that can support 100 billion yuan worth of transactions a year within the next decade.
-- China is expected to lead emerging economies in spending on consumable products, with an estimated average annual increase in total consumer spending of 15 percent every year to 2016, according to a report released by the Economist Intelligence Unit and U.K. research firm Mintel.
-- Shanghai expects to set up China's first free trade zone in Waigaoqiao in Pudong New Area as the city bids to become a global trade hub by 2020, a senior official said. Unlike a bonded area, a free trade zone offers businesses lower taxes, a more liberal currency exchange and better efficiency due to less supervision.
CHINA BUSINESS NEWS
-- New bank loans in January are expected to reach between 1 trillion yuan and 1.2 trillion yuan as the economy rebounds, according to market participants. Total new loans for 2013 are expected to reach 8.5 trillion yuan to 9 trillion yuan.
Fly On The Wall 7:00 Market Snapshot
AMC Networks (AMCX) upgraded to Equal Weight from Underweight at Morgan Stanley
Autodesk (ADSK) upgraded to Conviction Buy from Sell at Goldman
eBay (EBAY) upgraded to Outperform from Market Perform at Bernstein
EQT Midstream Partners (EQM) upgraded to Outperform from Neutral at Credit Suisse
Horizon Bancorp (HBNC) upgraded to Outperform from Market Perform at Raymond James
JPMorgan (JPM) upgraded to Buy from Hold at Deutsche Bank
KLA-Tencor (KLAC) upgraded to Hold from Sell at Deutsche Bank
NetEase.com (NTES) upgraded to Buy from Neutral at UBS
QLogic (QLGC) upgraded to Equal Weight from Underweight at Morgan Stanley
STMicroelectronics (STM) upgraded to Outperform from Neutral at Exane BNP Paribas
Sony (SNE) upgraded to Buy from Neutral at BofA/Merrill
Tiffany (TIF) upgraded to Overweight from Neutral at HSBC
Union First Market (UBSH) upgraded to Outperform from Neutral at RW Baird
Canadian Pacific (CP) downgraded to Sell from Hold at Canaccord
City National (CYN) downgraded to Neutral from Buy at SunTrust
Dime Community (DCOM) downgraded to Equal Weight from Overweight at Barclays
Flextronics (FLEX) downgraded to Neutral from Buy at UBS
Flowserve (FLS) downgraded to Buy from Strong Buy at CL King
Ford (F) downgraded to Equal Weight from Overweight at Barclays
Goldman Sachs (GS) downgraded to Hold from Buy at Deutsche Bank
Goldman Sachs (GS) downgraded to Neutral from Buy at Citigroup
Hanmi Financial (HAFC) downgraded to Market Perform from Outperform at FBR Capital
IAMGOLD (IAG) downgraded to Neutral from Buy at BofA/Merrill
Janus Capital (JNS) downgraded to Sell from Neutral at Citigroup
Janus Capital (JNS) downgraded to Underperform from Neutral at Credit Suisse
Medtronic (MDT) downgraded to Hold from Buy at Wunderlich
Noble Corp. (NE) downgraded to Hold from Buy at Jefferies
Scripps Networks (SNI) downgraded to Underweight from Equal Weight at Morgan Stanley
Select Comfort (SCSS) downgraded to Equal Weight from Overweight at Barclays
Skullcandy (SKUL) downgraded to Neutral from Overweight at Piper Jaffray
United Continental (UAL) downgraded to Underperform from Neutral at BofA/Merrill
Virginia Commerce (VCBI) downgraded to Market Perform from Outperform at FBR Capital
Accenture (ACN) initiated with an Overweight at Evercore
Actavis (ACT) initiated with an Overweight at Morgan Stanley
Amazon.com (AMZN) initiated with a Buy at ISI Group
Aon Corp. (AON) initiated with a Market Perform at Wells Fargo
BioMed Realty (BMR) initiated with a Neutral at Goldman
BioScrip (BIOS) initiated with a Buy at SunTrust
Boston Properties (BXP) initiated with an Overweight at Evercore
Brown & Brown (BRO) initiated with a Market Perform at Wells Fargo
Forestar Group (FOR) initiated with a Buy at DA Davidson
Marsh & McLennan (MMC) initiated with an Outperform at Wells Fargo
Park-Ohio (PKOH) initiated with an Outperform at Imperial Capital
Red Hat (RHT) initiated with an Outperform at Northland Securities
Starz (STRZA) initiated with a Sell at Stifel Nicolaus
Starz (STRZA) initiated with an Underweight at Evercore
AT&T (T) sees FY13 EPS growth to be upper-single digits or higher
Consensus for FY13 revenue is $128.3B
Sees FY13 consolidated margins to be stable
Starbucks (SBUX) targets opening of about 1,300 net new stores globally in FY13
Expects to open 1,500 new stores in U.S. over next five years
Said China a ”significant market opportunity,” expects to have 1,500 stores there by 2015
Court of Appeals agreed with Mattel (MAT), verdict, damages on MGA's claims reversed
Belkin to buy Cisco's (CSCO) home networking unit
Juniper (JNPR): Trends driving network investment in cloud/mobility intact
Sees improved momentum in routing in 2013 in Europe and U.S.
Expects to expand FY13 operating margins
City National (CYN) expects net income to grow 'very modestly' in 2013
US Airways (LCC) reached tentative agreement with flight attendants
Companies that beat consensus earnings expectations last night and today include:
KLA-Tencor (KLAC), Synaptics (SYNA), QLogic (QLGC), ResMed (RMD), Rambus (RMBS), Tempur-Pedic (TPX), Juniper (JNPR), Microsoft (MSFT), Cirrus Logic (CRUS)
Companies that missed consensus earnings expectations include:
Key Technology (KTEC), E-Trade (ETFC), Sterling Financial (STSA), AT&T (T)
Companies that matched consensus earnings expectations include:
Western Alliance (WAL), IBERIABANK (IBKC), Starbucks (SBUX)
U.S. electricity producers have increased their use of natural gas now that technological advances have unlocked vast amounts of the fuel in shale rock formations. But executives at some top utilities are wary of relying too heavily on natural gas to make electricity, concerned that its current low price may not last, the Wall Street Journal reports
As Samsung Electronics (SSNLF) and Apple (AAPL) attempt to defend their dominance in the smartphone market, the latest data show China’s Huawei Technologies Co. ranked third in terms of market share for the first time, an indication that a rapid increase of smartphone users in China and other emerging markets may be starting to alter the global landscape, the Wall Street Journal reports
Innovation Network Corp. of Japan, a Japanese state-backed fund, wants a Nissan Motor Co. (NSANY) and NEC Corp. JV to buy Sony’s (SNE) lithium-ion battery unit to prevent rivals in China and Taiwan from getting its technology as the TV maker looks to offload non-core businesses, the Daily Yomiuri said, Reuters reports
Lockheed Martin (LMT) is challenging the U.S. government in court over $13.6M in research tax credits in a case that tests the often unclear line between research and production, with future R&D claims by other companies possibly at stake, Reuters reports
Fed Chairman Bernanke’s unprecedented bond buying pushed the Fed’s balance sheet to a record $3T as he shows no sign of softening his effort to bring down 7.8% unemployment, Bloomberg reports
Over half of the $18T in national daily trading of energy swaps has moved to futures exchanges from the over-the-counter market in response to the U.S. regulatory overhaul aimed at increasing transparency--Dodd-Frank--following the 2008 financial crisis, Bloomberg reports
Adecogro (AGRO) files to sell 8.7M shares of common stock for holders
Anthera Pharmaceuticals (ANTH) files to sell common stock
ArrowHead Research (ARWR) files to sell common stock and warrants
BG Medicine (BGMD) enters $12M common stock purchase agreement with Aspire Capital
Bright Horizons (BFAM) 10.1M share IPO priced at $22.00
Chuy's (CHUY) 4.5M share Secondary priced at $25.00