- Wal-Mart's Sales Problem—And America's (WSJ)
- Investors fret that Italy may undermine ECB backstop (Reuters)
- Monti Government Mulls Delaying Monte Paschi Bailout (BBG)
- Norway Faces Liquidity Shock in Record Redemption (BBG)
- ECB's Praet Says Accommodative Policy Could Lose Effectiveness (BBG)
- EU Chiefs Tell Italy There’s No Alternative to Austerity (BBG)
- New Spate of Acrimony in congress As Cuts Loom (WSJ)
- BOE's Tucker hints at radical growth moves (FT)
- Kuroda Seen Getting DPJ Vote for BOJ, Iwata May Be Opposed (BBG)
- Russian Banks Look to Yuan Bond Market (WSJ)
- Dagong warns about rising debt (China Daily)
- Italy Election Impasse Negative for Credit Rating, Moody’s Says (BBG)
Overnight Media Digest
WSJ
* Regulators investigating alleged interest-rate manipulation are hoping to reach settlements with at least three major financial institutions by the end of summer, according to a person familiar with the probes.
* JPMorgan Chase & Co stepped up the pace of bank cost cutting, setting plans to eliminate 17,000 jobs by the end of next year and reduce expenses by at least $1 billion annually.
* U.S. Federal Reserve Chairman Ben Bernanke came down firmly in favor of continuing the central bank's bond-buying programs, even as he acknowledged concerns that the efforts might encourage risk-taking that could someday destabilize markets or the economy.
* Pay-TV distributor Cablevision Systems Corp sued MTV's owner Viacom Inc alleging antitrust violations. Cablevision alleged Viacom forced it to carry and pay for more than a dozen "lesser-watched" channels such as "Palladia, MTV Hits and VH1 Classic" for the right to carry its popular networks such as Nickelodeon, MTV and Comedy Central.
* Boeing Co's proposed fixes for lithium-ion batteries on its 787 jetliner face an uncomfortable reality: government investigators' limited experience with such devices is hobbling efforts to determine precisely why they burned.
* Wall Street cash bonuses for 2012 are expected to climb 8 percent to $20 billion from a year earlier, boosted in part by the payment this year of compensation deferred from prior years, according to a report from New York State Comptroller Thomas DiNapoli.
* Clearwire Corp plans to tap financing made available by Sprint Nextel Corp, people familiar with the situation said, in a move that further complicates Dish Network Corp's effort to buy the wireless broadband operator.
* New Jersey Governor Chris Christie signed a bill that legalizes online gambling in the state, allowing Atlantic City casino companies to take bets online.
* Much anticipated knockoff versions of costly biotech medicines are facing delays and obstacles that could cost patients and health systems billions in missed savings - several high-profile projects have faltered in recent months.
FT
The Co-operative Bank's deal to buy more than 600 branches from Lloyds Banking Group is under threat as the Co-op faces a 1 billion pound capital hole.
All companies involved in project shared responsibility for safety on the Deepwater Horizon rig, a BP executive said at the trial in New Orleans centred on the 2010 Gulf of Mexico oil spill and its aftermath.
Repsol has sold a set of LNG assets to Royal Dutch Shell in a deal with an enterprise value of $6.7 billion.
British bank Barclays is set to reveal a list of employees who earned over 1 million pounds last year in its annual report next week.
JPMorgan Chase & Co will cut 17,000 jobs, or 7 percent of its workforce, over the next two years.
British home and motor insurer Esure has been warned by fund managers against overpricing its initial public offering.
Paul Tucker raised the possibility of charging negative interest rates on a portion of banking reserves fuelling speculation that the Bank of England may redouble efforts to prop up economic growth.
NYT
* On the first day of testimony in the oil spill trial, BP Plc's top executive for North American operations at the time of the disaster acknowledged that a well explosion had been identified as a risk before it happened.
* Boeing Co is conducting laboratory tests on its proposed fixes for the lithium-ion batteries on its new 787 jets, and U.S. federal regulators said Tuesday that they would need to see the results before deciding whether to allow flight tests.
* The U.S. Senate Finance Committee, dismissing some Republican objections, on Tuesday approved the nomination of Jacob Lew for Treasury secretary and sent it on to the full Senate for a confirmation vote in the days ahead.
* Lawmakers are scrutinizing Mary Jo White, U.S. President Obama's choice to lead the Securities Exchange Commission, ahead of her Senate confirmation hearing, raising questions about the former prosecutor's lack of regulatory experience and the challenge of policing Wall Street firms she recently defended in private practice. But White is seeking to quell concerns about potential conflicts of interest.
* SFX Entertainment, the company led by media executive Robert F. X. Sillerman, has agreed to buy the music download site Beatport, part of the company's plan to build a $1 billion empire centered on the electronic dance music craze.
* The average cash bonus for people employed in New York City in the financial industry rose by roughly 9 percent, to $121,900, in 2012, the New York State comptroller said.
* Jamie Dimon, the chief executive of JPMorgan Chase & Co , vowed to change how the bank deals with Internet-based payday lenders that automatically withdraw payments from borrowers' checking accounts.
Canada
THE GLOBE AND MAIL
* Declining enrolment numbers are forcing the Toronto District School Board to consider cutting back on high-school teachers. Staff have suggested to trustees that they cut 248 secondary school teaching jobs, based on enrolment numbers that show 2,300 fewer students than initially projected.
Reports in the business section:
* Air Canada shouldn't be granted any additional reprieve by the federal government on financing its pension deficit unless Ottawa also gives similar relief to all Canadian carriers, the Air Transport Association of Canada, which represents small Canadian regional airlines and flight training groups, says.
NATIONAL POST
* The federal government is writing off another C$231 million ($224.57 million) in unpaid student loans this year from more than 44,000 cases, meaning taxpayers are on the hook for more than half a billion in uncollected student debt over the past few years.
FINANCIAL POST
* The U.S. Defense Department said it plans to open its networks by next February to about 100,000 mobile phones and tablet computers made by companies such as Apple and Google. The move may pose a threat to BlackBerry , the Pentagon's biggest supplier of smartphones.
China
CHINA SECURITIES JOURNAL
-- The Shanghai Futures Exchange said it will issue petroleum asphalt futures, which would be the first of its kind in the world, as soon as June.
-- China Mobile said it would invest 180 billion yuan ($28.89 billion) to build 200,000 TD-LTE stations in 2013.
CHINA DAILY
-- China's sea level hit a record high in 2012 due to global warming and land subsidence, threatening millions of coastal residents, the State Oceanic Administration said in a report.
SHANGHAI DAILY
-- China's navy has taken delivery of a new type of stealth frigate which will be mainly used for escort missions and anti-submarine operations.
Fly On The Wall 7:00 Market Snapshot
ANALYST RESEARCH
Upgrades
Allscripts (MDRX) upgraded to Outperform from Neutral at Credit Suisse
Biogen (BIIB) upgraded to Buy from Hold at Canaccord
Darden (DRI) upgraded to Neutral from Underperform at BofA/Merrill
EMCOR Group (EME) upgraded to Buy from Hold at KeyBanc
Edison International (EIX) upgraded to Buy from Neutral at SunTrust
Google (GOOG) upgraded to Buy from Neutral at BofA/Merrill
RadioShack (RSH) upgraded to Market Perform from Underperform at Raymond James
Downgrades
E.W. Scripps (SSP) downgraded to Neutral from Overweight at JPMorgan
First Cash Financial (FCFS) downgraded to Hold from Buy at Jefferies
First Solar (FSLR) downgraded to Neutral from Outperform at RW Baird
First Solar (FSLR) downgraded to Underperform from Neutral at BofA/Merrill
GrafTech (GTI) downgraded to Neutral from Overweight at JPMorgan
GrafTech (GTI) downgraded to Sell from Neutral at Goldman
Homex (HXM) downgraded to Underperform from Neutral at BofA/Merrill
InvenSense (INVN) downgraded to Neutral from Outperform at RW Baird
MarkWest Energy (MWE) downgraded to Neutral from Outperform at Credit Suisse
NuVasive (NUVA) downgraded to Neutral from Buy at Mizuho
Oasis Petroleum (OAS) downgraded to Neutral from Buy at SunTrust
Royal Bank of Canada (RY) downgraded to Neutral from Buy at Citigroup
VeriSign (VRSN) downgraded to Neutral from Outperform at Credit Suisse
Initiations
Bank of Montreal (BMO) initiated with a Buy at Citigroup
Canadian Imperial Bank (CM) initiated with a Neutral at Citigroup
Norwegian Cruise Line (NCLH) initiated with a Buy at UBS
Norwegian Cruise Line (NCLH) initiated with a Neutral at Goldman
Norwegian Cruise Line (NCLH) initiated with a Neutral at UBS
Norwegian Cruise Line (NCLH) initiated with an Outperform at Wells Fargo
Norwegian Cruise Line (NCLH) initiated with an Overweight at JPMorgan
Rentech Nitrogen (RNF) initiated with a Sector Perform at RBC Capital
HOT STOCKS
The FAA could allow Boeing 787 (BA) test flights next week, DJ reports
New Jersey Governor Christie signed Internet gaming bill into law (ZNGA, IGT, GLUU, MGM, HOT, LVS, WYNN, CZR, BYD, PENN)
Accretive Health (AH) postponed results; evaluating revenue recognition procedure
First Solar (FSLR): Market to remain turbulent for ”some time to come”
CommonWealth (CWH) REIT to continue to pursue offering, debt tender offer
Corvex, Related want talks with CommonWealth over $25 per share offer
Range Resources (RRC) sees 2013 production growth of 20%-25%
MasterCard (MA), Beam collaborate on new mobile companion pre-paid card
Advantage Oil & Gas (AAV) formed special committee to consider strategic alternatives
Papa John's (PZZA) to restate financials for FY09-FY11, part of FY12
EARNINGS
Companies that beat consensus earnings expectations last night and today include:
AES Corp. (AES), Joy Global (JOY), Range Resources (RRC), NuVasive (NUVA), Bio-Rad (BIO), Jazz Pharmaceuticals (JAZZ), Big 5 Sporting (BGFV), Edison International (EIX), First Solar (FSLR), priceline.com (PCLN)
Companies that missed consensus earnings expectations include:
GasLog (GLOG), Ormat Technologies (ORA), Papa John's (PZZA), American Water (AWK), TiVo (TIVO)
Companies that matched consensus earnings expectations include:
Erie Indemnity (ERIE), Uni-Pixel (UNXL)
NEWSPAPERS/WEBSITES
- Fed Chairman Bernanke came down firmly in favor of continuing the central bank's bond-buying programs, even as he acknowledged concerns that the efforts might encourage risk-taking that could one day destabilize markets or the economy, the Wall Street Journal reports
- Sales of new homes are surging in the U.S.,and the trend partly reflects the small inventory of previously owned homes, now at a 13-year low after investors picked over the long-depressed market. But the strong sales of new homes also show how the nation's home builders (TOL, LEN, PHM, DHI) have mastered the art of selling, even to cash-poor buyers or those with spotty credit histories, the Wall Street Journal reports
- Investment firm Royalty Pharma doesn’t want to take "no" for an answer to its $6.6B offer for Irish drugmaker Elan Corp. (ELN), and plans to spend the next few weeks calling Elan shareholders about its February 18 offer, sources say, Reuters reports
- The European parliament and EU states could agree today to impose caps on bankers' bonuses, a measure that would channel public fury at financial sector greed, but which opponents say marks a reckless overreach into private pay deals, Reuters reports
- Wall Street junk-bond underwriters (GS, JPM, DB, C, BAC) selling debt at a record pace after the securities returned 19% last year, say it’s obvious that prices will drop when interest rates rise. So don’t blame the banks, Bloomberg reports
- JPMorgan Chase (JPM) CEO Jamie Dimon said banks are accumulating more capital than they need as regulators push lenders to build equity. Dimon has said excessive regulation could impede growth as international authorities and the Fed push banks to guard capital to better withstand another financial crisis, Bloomberg reports
SYNDICATE
El Paso Pipeline (EPB) files to sell $500M equity shelf
Hyperion Therapeutics (HPTX) files to sell $50M of common stock
Meru Networks (MERU) announces proposed offering of common stock
PG&E (PCG) announces offering of 7.2M shares of common stock
ACTIVIST/PASSIVE FILINGS
Caledonia Investments reports 13.49% passive stake in Zillow (Z)
Caledonia Investments reports 12.43% passive stake in Trulia (TRLA)