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Chinese inflation spikes to 3.2%. Chinese inflation jumped to 3.2% on year in February from 2% previously, with the spike the result of the Lunar New Year. The data comes as other indicators slow down, including industrial production, retail sales and electricity output, which is often looked at because of the "quality concerns" of other metrics. The figures have helped send U.S. stock futures lower, as well as bourses in Europe and Asia.

AT&T eyes $3.5B stake in Indian telco venture. AT&T (NYSE:T) is reportedly looking at acquiring a 25% stake in Indian telecom venture Reliance Jio Infocomm for $3.5B in a deal that would represent the largest foreign direct investment in India. Reliance Jio Infocomm, which is controlled by the country's richest man, Mukesh Ambani, hasn't yet begun operating; it aims to break even within three years of starting services.

Negative Merck trial could hit AbbVie's Niaspan. Negative results from a major study of Merck's (NYSE:MRK) cholesterol drug Tredaptive could spell the end of sales of AbbVie's (NYSE:ABBV) Niaspan, which is an extended-release form of the niacin vitamin that generated revenues of $911M in 2012. Niacin is used in Tredaptive along with Merck's laropiprant; Tredaptive failed to reduce strokes, deaths and heart attacks in patients with vascular diseases and it caused increased side effects.

Top Stock News
U.K. parliamentary panel advocates collective punishment for banks. Britain's Parliamentary Commission on Banking Standards has said that the government should consider breaking up all banks into retail and investment-bank activities if just one of them breaches new ring-fencing rules designed to avoid another bailout. The Commission made its call ahead of a parliamentary debate today on the government's Banking Reform Bill, which is weaker than the panel would like it to be.

S&P 500 beats mutual funds over 20 years. In the two decades through December, the average return of all investors in U.S. stock mutual funds was an annualized 4.25% vs 8.2% for the S&P 500. That translates into a difference of $25,467 for an investment of $10,000. "The dismal truth is that over the long run, the average person is a woeful investor," writes the NYT's Jeff Sommer.

Suitors circle Twinkies. Bidders have until 5 pm today to submit their offers for Twinkies and other Hostess Brands snack cakes, with a bankruptcy court auction set for Wednesday. Stalking horse bidders Apollo Global Management (NYSE:APO) and veteran food executive Dean Metropoulos could reportedly be joined by Hostess creditor Silver Point Capital and hedge-fund newcomer Hurst Capital in concert with other private-equity firms, as well as by Mexico's Grupo Bimbo (OTCPK:GRBMF).

Ethanol law could lead to rise in gasoline prices. The cost of complying with a federal law to use corn ethanol in fuel has sky rocketed. The problem is that refiners are hitting the "blend wall," whereby, according to recommendations from car makers, ethanol shouldn't comprise more than 10% of gasoline. That could conflict with proposed increased EPA quotas for ethanol next year, which has caused the price of ethanol credits to jump to over $1 from just a few cents in 2012. Eventually, refiners will pass the costs onto consumers, says Valero Energy (NYSE:VLO).

F-35 retrofit expenses seen topping $1.7B. The cost of retrofitting the F-35 fighter jet to fix problems found during testing is forecast to exceed $1.7B, the Government Accountability Office reportedly says in a draft study. The retrofits stem from the decision to start manufacturing the aircraft at too early a stage in its development and testing. Cost overruns on 63 planes that have already been built are expected at $1.2B.

Companies look to overturn NLRB rulings. Starbucks (NASDAQ:SBUX), Time Warner (NYSE:TWX) and LabCorp (NYSE:LH) are among dozens of companies attempting to block decisions by the National Labor Relations Board following a court ruling in January that found President Barack Obama's board appointments to be unconstitutional. The companies, as well as some unions, have argued that the NLRB doesn't have the authority to make the decisions because of the ruling.

Top Economic & Other News
China unveils government restructure. China plans to break up its powerful Railways Ministry as part of a major overhaul of government designed to cut corruption and bureaucracy. "The new leadership is sending a clear message that they are...serious about building a cleaner and more efficient government," says university professor Chen Yao.

German exports edge up. Germany's trade surplus slipped to a seasonably adjusted €15.7B in January from €16.9B in December and vs consensus of €15.8B. Exports rose 1.4% on month and imports 3.3%. "Very hesitantly, hard data is reflecting the strong rebound in sentiment surveys," says Berenberg Bank economist Christian Schulz. "The economy is rebounding from the sharp contraction, but the extent of the rebound remains subject to some uncertainty."

Japanese machinery orders slump. Japanese machinery orders, a leading indicator of capex, dropped for the first time in four months in January, plunging 13.1% vs +2.8% in December and consensus of -2%. The government blamed the sharp decline on big-ticket items such as turbines and boilers, and forecast a rise in orders of 0.8% in Q1. Economist Takeshi Minami says that while the drop was greater than expected, "this is a temporary fall."

Legislators look to apply scalpel to sequestration. Now that Washington looks to have accepted the $85B sequestration, GOP legislators are looking to see where they can apply the scalpel rather than the machete. Programs at risk include one for robotic squirrels that helps researchers understand how squirrels interact with rattlesnakes, and NASA's work on feeding astronauts on Mars.

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Today's Markets:
In Asia, Japan +0.5% to 12349. Hong Kong flat at 23091. China -0.3% to 2311. India -0.2% to 19646.
In Europe, at midday, London flat. Paris -0.5%. Frankfurt -0.3%.
Futures at 7:00: Dow -0.1%. S&P -0.1%. Nasdaq -0.2%. Crude -0.3% to $91.69. Gold +0.1% to $1577.60.

Today's economic calendar:
No events scheduled.

Notable earnings before today's open: CSIQ, DKS, RENN

Notable earnings after today's close: CASY, CQB, CVI, DMND, FCEL, HEK, HMIN, PWRD, XNPT

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Source: Wall Street Breakfast: Must-Know News