Deutsche Bank Q4 net loss €2.17B due to massive charges. Deutsche Bank (DB) swung to a Q4 net loss of €2.17B from a profit of €147M profit last year and vs consensus for a loss of €311M. Earnings were hit by a €1.9B goodwill impairment charge for restructuring and the creation of a non-core unit to sell €125B in assets. DB, which is being investigated for interest-rate manipulation, is also taking €1B in litigation charges. Shares were +1% premarket.
Facebook shares fall despite earnings beat. Accelerated growth in Facebook's (FB) mobile ad sales helped the company's Q4 earnings beat expectations, with EPS coming in at $0.17 and revenue jumping 40% to $1.59B. However, net profit slumped 79% to $64M, due to increased spending and charges related to employee shares. Overall ad sales climbed 41% to $1.33B, of which mobile accounted for 23%. That's up from 14% in Q3, although the growth didn't meet heightened expectations, which could be one reason for the stock sliding 5.6% premarket.
AstraZeneca shares slump following earnings warning. AstraZeneca's (AZN) results topped expectations in Q4, but earnings fell due to the company's patent cliff, which is expected to continue hurting its income. Profit excluding items dropped 8% to $1.94B, EPS was $1.56, and revenue slid 16% to $7.28B. AstraZeneca warned of a "mid-to-high single digit percentage decline in revenue for 2013," and that earnings will drop "significantly more than revenue" as operating costs rise. Shares were -5.1% premarket.
Top Stock News
Santander profit surges as it cleans up the bad debt. Santander's (SAN) Q4 net profit rose 8-9 fold to €401M but came in below consensus of €520M as the bank completed the clean-up of its Spanish real-estate loan portfolio. Net interest income dropped 5.2% to €7.15B vs forecasts of €7.3B. For the whole of 2012, Santander set aside €18.8B for bad debt and has now covered all of its Spanish government-enforced provisions for this purpose, so it expects "a marked recovery in results" in 2013. However, shares were -3.1% premarket.
KKR, JPM joining up to bid for €5-8B Vivendi unit. KKR (KKR), JPMorgan's (JPM) Gavea Investimentos and Apax Partners are among those reportedly getting together to bid for Vivendi's (OTCPK:VIVHY) GVT phone unit in Brazil, putting them in competition with DirecTV (DTV). The group may offer up to €5B, although that's well below Vivendi's asking price of €8B. DirecTV could be more willing to make a proposal that's closer to Vivendi's figure, due to the synergies the deal would bring.
Top four U.K. banks face fines over mis-selling of products. Barclays (BCS), HSBC (HBC), Lloyds (LYG) and RBS (RBS) may have to pay small-business customers hundreds of millions of pounds in compensation for the mis-selling of products that were supposed to lower their clients' interest-rate risks. The FSA has ordered the banks to review the sales after the U.K. regulator found that the banks breached rules in over 90% of 173 deals that it looked at. Barclays has already provisioned £450M for the purpose.
BlackBerry plummets after BB10 launch. Shares in RIM (RIMM), which is changing its name to BlackBerry, were -3.6% premarket and adding to losses of 12% yesterday following the very long-awaited launch of its new BlackBerry operating system and devices. Still, the early reviews seem to be favorable enough, although one says, "It's not quite enough, not quite soon enough."
GM expected to name latest Opel head. GM (GM) is today expected to name former Volkswagen executive Karl-Thomas Neumann as the CEO of its perennial loss-making Adam Opel unit. Neumann, who is due to start on March 1, will be taking on a poisoned chalice: GM's European subsidiary has generated cumulative losses of $15B since 1999, which has caused a succession of CEOs to lose their jobs. He also won't be helped by the sorry state of the European car market.
HSBC's deal to sell $7.4B Ping An holding due to expire. HSBC's (HBC) agreement to sell the rest of its stake in Ping An Insurance to Thailand's Charoen Pokphand for $7.4B is set to expire today if a Chinese regulator does not sign off on the deal, or if the parties don't agree to an extension. With HSBC planning to book a $2.6B profit on the sale, the "odds are high" the agreement will be extended.
Chevron loses appeal over asset freezes in Argentina. Chevron (CVX) has lost its appeal in Argentina against asset freezes to enforce an Ecuadorean judgment that it should pay $19B in damages for environmental pollution. While Chevron has refused to make any payments and has accused Ecuadorean courts of fraud, the company may need to spell out the impact of the decision in its upcoming financial statements or risk violating SEC rules.
Time Warner mulls sale of NYC HQ. Time Warner (TWX) is reportedly thinking about selling its headquarters in Manhattan, which could fetch over $1B. The price will depend on whether Time Warner would leave the building or lease it back after a sale. If Time Warner does sell the property, it would follow Sony (SNE) in offloading a Manhattan HQ.
Top Economic & Other News
German unemployment unexpectedly drops but so do retail sales. German unemployment has unexpectedly fallen for the first time in 10 months in January, declining 16,000 to 2.92M vs consensus for a rise of 8,000. The jobless rate dropped to 6.8% from 6.9% in December. "The German labor market is in a good position," says SocGen economist Anatoli Annenkov. However, retail sales cratered 4.7% on year in December, far worse than forecast and representing the largest decline since May 2009.
Japanese industrial output points to recovering economy. Japan's industrial production recovered to rise 2.5% on month in December vs -1.4% in November, although the growth was below consensus of +4.1%. With the companies surveyed for the report expecting more gains in January and February, the data adds to other metrics which indicate that the economy could be rebounding from its recent slump.
In Asia, Japan +0.2% to 11139. Hong Kong -0.4% to 23730. China +0.1% to 2385. India -0.6% to 19895.
In Europe, at midday, London -0.5%. Paris -0.9%. Frankfurt -0.5%.
Futures at 7:00: Dow -0.1%. S&P -0.1%. Nasdaq -0.3%. Crude -0.2% to $97.74. Gold -0.3% to $1676.60.
Today's economic calendar:
7:30 Challenger Job-Cut Report
8:30 Initial Jobless Claims
8:30 Personal Income and Outlays
8:30 Employment Cost Index
9:45 Bloomberg Consumer Comfort Index
9:45 Chicago PMI
10:30 EIA Natural Gas Inventory
3:00 PM USDA Ag. Prices
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
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