- Chrysler Ch. 11 imminent. Talks between Chrysler lenders and the Treasury broke down Wednesday, making it all but certain that the automaker will file for bankruptcy today. Government officials say everything is in place to ensure the company makes it through court quickly, possibly in as little as a few weeks. Even as the automaker prepares for a likely bankruptcy, Obama said he's hopeful Chrysler will be able to push forward with a Fiat alliance.
- GM bondholders prep counteroffer. General Motors' (GM) bondholders plan to reject GM's April 27 debt exchange offer, and to present a counteroffer that would give them control of the automaker. Sources say the counteroffer proposes that bondholders and a UAW retiree medical fund both exchange all their claims for equity stakes of 58% and 41% respectively. Common shareholders would be left with 1% ownership. A committee representing bondholders will present the alternative plan to the auto task force today. Shares +3.9% premarket (7:00 ET).
- FOMC: recession is easing. As expected, the FOMC kept rates steady at 0-0.25%. The committee pointed to signs of economic improvement, and forecast a gradual recovery amid market weakness: "Although the economic outlook has improved modestly since the March meeting, partly reflecting some easing of financial market conditions, economic activity is likely to remain weak for a time. Nonetheless, the Committee continues to anticipate that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will contribute to a gradual resumption of sustainable economic growth in a context of price stability." Even as the FOMC took note of some 'green shoots' in markets, it left the door open to boosting emergency financial programs if necessary. (Read the FOMC statement)
- 100+ PPIP applications. More than 100 firms applied to participate in PPIP, the Treasury's toxic-asset purchase program. At least five will get preliminary approval by May 15, at which point they can begin raising the expected minimum of $500M in private capital. (Read the Treasury's statement)
- Lewis ousted as chairman. A shareholder proposal removed Bank of America (BAC) CEO Ken Lewis from his position as chairman of the board, a possible precursor to his eventual replacement as CEO. The proposal passed narrowly, with 50.34% of the vote. Board member Walter Massey will assume the chairman's post.
- State Street probed over mortgage securities. Massachusetts' top securities regulator launched a probe into whether State Street Corp (STT) misled pension funds over the risk level of certain investments. In particular, regulators are investigating whether State Street represented mortgage-backed securities as low-risk vehicles, and whether funds marketed as safe held 'potentially inappropriate' derivatives, swaps and other securities. A State Street spokeswoman declined to comment.
- FBI probes Freddie losses. The FBI is reportedly investigating possible accounting violations at Freddie Mac (FRE), trying to determine whether the mortgage giant improperly delayed the recognition of billions of dollars of losses. The losses, incurred from 2001-2004, were connected to derivatives contracts and are due to be gradually recognized in quarterly earnings statements over the next several years.
- IBM offers pre-stimulus financing. IBM (IBM) is offering $2B in financing to customers who want to invest in broadband and healthcare technologies but are waiting to receive government stimulus funds. Since much of the government funding won't reach companies until 2010 or later, IBM sees this as a way to "jump-start those investments and jump-start the benefits."
- Budget approved. Congress approved a $3.5T budget outline for 2010, which includes special funds to pay for sweeping changes in health care, education and energy. Democrats said their budget outline will cut the deficit by more than 50% in five years. Republicans argued the reduced deficit projections omit costs, such as disaster relief, from future-year expenditures.
- IACI goes match-making. IAC/InterActiveCorp (IACI) is in talks to buy Yahoo Personals, Yahoo's (YHOO) online dating service. Yahoo has considered selling the matchmaking site in the past, and CEO Carol Bartz has expressed her interest in selling or shuttering non-core businesses. The dating site could be worth around $500M.
- Time Warner, AOL prepare to part. Time Warner (TWX) said it's preparing to move ahead with a spinoff of all or part of its struggling AOL unit, and a decision is expected 'very soon.' The company also plans to buy back Google's (GOOG) 5% stake in AOL.
- Visa beats forecast on cost cuts, debit use. Visa (V) posted better-than-expected quarterly results (see details below) as the company increased prices and cut costs. The company also benefited from consumers' increased reliance on debit cards The number of Visa-branded cards grew 8% globally to more than 1.7B, while the number of transactions processed on its network climbed 9%.
- Starbucks to focus on value. Starbucks (SBUX) narrowly beat expectations for quarterly earnings (see details below) on cost cuts. Trying to re-brand itself for the economic times, Starbucks plans to launch a multimillion dollar campaign challenging the view that coffee is an expensive luxury. The company will also selectively lower prices on some of its popular drinks while slightly raising prices on larger, more complex beverages.
- MGM finds project financing. MGM Mirage (MGM) and Dubai World reached an agreement with lenders to fully finance their $8.5B CityCenter project in Las Vegas, and Dubai World dismissed its lawsuit against MGM. The project is on track to open in December 2009.
- Apple builds chip-design team. Apple (AAPL) is shifting strategy with plans to build its own team for chip design. The company hopes the move will shield Apple's work from rivals and lead to the development of exclusive features for its gadgets.
- GDP worse than expected. Advanced Q1 GDP was -6.1% vs. consensus of -4.7% and last quarter's -6.3%. Personal consumption increased 2.2% vs. consensus of +0.9% and prior -4.3%. The price index rose 2.9% vs. consensus of +1.8% and prior +0.5%.
- BoJ holds rates steady. Bank of Japan kept its benchmark rate unchanged at 0.1%. The bank will release its economic outlook today, and will likely forecast a deeper contraction than the 2% drop predicted three months ago.
Earnings: Thursday Before Open
- Alliant Energy (LNT): Q1 EPS of $0.30 misses by $0.24. (PR)
- Ashland (ASH): FQ2 EPS of $0.64 beats by $0.34. Revenue of $2.0B (-3.4%) vs. $2.1B. (PR)
- BorgWarner (BWA): Q1 EPS of -$0.12 beats by $0.08. Revenue of $819.5M (-45.3%) vs. $854M. (PR)
- Cardinal Health (CAH): FQ3 EPS of $0.97 beats by $0.02. Revenue of $24.9B (+8.9%) vs. $24.0B. (PR)
- Celgene (CELG): Q1 EPS of $0.44 beats by $0.01. Revenue of $601M (+29.9%) vs. $602M. (PR)
- CIGNA (CI): Q1 EPS of $0.69 misses by $0.22. Revenue of $4.8B (+4.5%) in-line. (PR)
- CMS Energy (CMS): Q1 EPS of $0.30 in-line. Revenue of $2.1B (-3.6%) in-line. (PR)
- Colgate-Palmolive (CL): Q1 EPS of $0.97 beats by $0.01. Revenue of $3.5B (-5.7%) vs. $3.6B. (PR)
- Comcast (CMCSA): Q1 EPS of $0.27 beats by $0.04. Revenue of $8.4B (-5%) vs. $8.8B. (PR)
- Covidien (COV): FQ2 EPS of $0.69 misses by $0.16. Revenue of $2.7B (+11.3%) vs. $2.6B. (PR)
- Digital Realty Trust (DLR): Q1 EPS of $0.70 beats by $0.03. Revenue of $149M (+30.2%) vs. $147M. (PR)
- Dominion Resources (D): Q1 EPS of $0.97 beats by $0.09. Revenue of $4.8B (+9.8%) vs. $4.1B. (PR)
- Dow Chemical (DOW): Q1 EPS of $0.12 beats by $0.33. Revenue of $9.1B (-38.7%) vs. $11.7B. Shares +1.4% premarket (6:50 ET). (PR)
- Eastman Kodak (EK): Q1 EPS of -$1.34 misses by $1.01. Revenue of $1.5B (-29.4%) vs. $1.6B. (PR)
- Entegris (ENTG): Q1 EPS of -$0.34 misses by $0.09. Revenue of $59M (-60.2%) vs. $71M. (PR)
- EQT Corp. (EQT): Q1 EPS of $0.55 misses by $0.01. Revenue of $260M (-1.6%) vs. $310M. (PR)
- ExxonMobil (XOM): Q1 EPS of $0.92 misses by $0.03. Revenue of $64.03B (-45.2%) vs. $54.03B. Shares +0.6% premarket. (AP)
- GrafTech International Ltd (GTI): Q1 EPS of $0.04 beats by $0.03. Revenue of $134M (-53.8%) vs. $153M. (PR)
- International Paper (IP): Q1 EPS of $0.08 beats by $0.12. Revenue of $5.7B (+0%) vs. $6.3B. (PR)
- Iron Mountain (IRM): Q1 EPS of $0.20 beats by $0.08. Revenue of $723M (-3.5%) vs. $722M. (PR)
- KBR (KBR): Q1 EPS of $0.48 beats by $0.05. Revenue of $3.2B (+27%) vs. $2.9B. (PR)
- Kellogg (K): Q1 EPS of $0.89 beats by $0.10. Revenue of $3.2B (-2.7%) in-line. (PR)
- Kimco Realty (KIM): Q1 EPS of $0.43 misses by $0.01. Revenue of $194M (+2.7%) vs. $191M. (PR)
- LKQ Corp. (LKQX): Q1 EPS of $0.23 beats by $0.02. Revenue of $518M (+5.3%) vs. $523M. (PR)
- LM Ericsson Telephone (ERIC): Q1 EPS of $0.54 misses by $0.17. Revenue of $49.6B (+12.2%) vs. $42.3B. Shares -5.8% premarket (6:50 ET). (PR)
- Motorola (MOT): Q1 EPS of -$0.10 beats by $0.01. Revenue of $5.4B (-27.9%) vs. $5.55B. Shares -16% premarket (7:00 ET). (PR)
- Mylan Laboratories (MYL): Q1 EPS of $0.33 beats by $0.05. Revenue of $1.2B (+12.6%) in-line. (PR)
- Newell Rubbermaid (NWL): Q1 EPS of $0.20 beats by $0.12. Revenue of $1.2B (-16%) in-line. (PR)
- Newmont Mining (Holding Company) (NEM): Q1 EPS of $0.44 beats by $0.02. Revenue of $1.55B (-20.1%) vs. $1.40B. (PR)
- Noble Energy (NBL): Q1 EPS of $0.59 beats by $0.15. Revenue of $441M (-57%) vs. $598M. (PR)
- NRG Energy (NRG): Q1 EPS of $0.70 beats by $0.25. Revenue of $1.7B (+27.3%) vs. $1.2B. (PR)
- NYSE GROUP (NYX): Q1 EPS of $0.43 beats by $0.04. Revenue of $1.1B (+0.2%) in-line. (PR)
- OfficeMax (OMX): Q1 EPS of $0.23 beats by $0.07. Revenue of $1.91B (-17%) vs. $1.95B. (PR)
- Omnicare (OCR): Q1 EPS of $0.64 beats by $0.03. Revenue of $1.6B (+0.3%) in-line. Shares +3.3% premarket (8:10 ET). (PR)
- Oshkosh Corporation (OSK): FQ2 EPS of -$0.24 misses by $0.04. Revenue of $1.3B (-26.9%) vs. $1.5B. (PR)
- Owens Corning (OC): Q1 EPS of $0.04 beats by $0.08. Revenue of $1.1B (-20.6%) vs. $1.2B. (PR)
- Patterson-UTI Energy (PTEN): Q1 EPS of $0.11 misses by $0.03. Revenue of $296M (-41.3%) vs. $319M. (PR)
- Pennsylvania Real Estate Investment Trust (PEI): Q1 EPS of $0.71 beats by $0.03. Revenue of $73M (-0.8%) vs. $67M. Shares +1.2% premarket (8:10 ET). (PR)
- Pride International (PDE): Q1 EPS of $0.87 beats by $0.01. Revenue of $549M (+1.7%) vs. $555M. (PR)
- Procter & Gamble (PG): FQ3 EPS of $0.84 beats by $0.04. Revenue of $18.4B (-8%) vs. $18.9B. Shares +2.1% premarket (8:00 ET). (PR)
- Rayonier (RYN): Q1 EPS of $0.33 beats by $0.04. Revenue of $274M (-0.3%) vs. $286M. (PR)
- Regal Entertainment Group (RGC): Q1 EPS of $0.14 misses by $0.02. Revenue of $666M (+6.2%) vs. $651M. (PR)
- Sepracor (SEPR): Q1 EPS of $0.85 beats by $0.16. Revenue of $330M (+2.9%) vs. $329M. (PR)
- Spirit AeroSystems (SPR): Q1 EPS of $0.45 beats by $0.05. Revenue of $887M (-14.4%) vs. $859M. (PR)
- Starwood Hotels & Resorts Worldwide (HOT): Q1 EPS of $0.14 beats by $0.10. Revenue of $1.1B (-23.7%) in-line. (PR)
- Taiwan Semiconductor Manufacturing (TSM): Q1 EPS of $0.01 beats by $0.02. Revenue of $1.2B (-57.9%) vs. $1.1B. Shares +4.5% premarket (8:00 ET). (PR)
- The Travelers Companies (TRV): Q1 EPS of $1.34 beats by $0.03. Revenue of $5.7B (-8.0%) vs. $6.1B. (PR)
- Tyco International (TYC): FQ2 EPS of $0.55 beats by $0.14. Revenue of $4.15B (-14.7%) vs. $4.2B. (PR)
- Viacom(B): Q1 EPS of $0.29 beats by $0.03. Revenue of $2.9B (-6.8%) vs. $3.0B. (PR)
- Watson Pharmaceuticals (WPI): Q1 EPS of $0.58 beats by $0.09. Revenue of $667M (+6.5%) vs. $638M. Shares +6.0% premarket (8:05 ET). (PR)
- Xcel Energy (XEL): Q1 EPS of $0.38 beats by $0.01. Revenue of $2.7B (-11%) vs. $3.1B. (PR)
Earnings: Wednesday After Close
- AFLAC (AFL): Q1 EPS of $1.22 beats by $0.06. Revenue of $4.82B (+12%) in-line. Total investments and cash of $61.7B down 1.7% Y/Y. Shares -2% AH. (PR)
- Agnico-Eagle Mines (AEM): Q1 EPS of $0.35 beats by $0.26. Revenue of $111M (-10.5%) vs. $72M. Shares +1.7% AH. (PR)
- Akamai Technologies (AKAM): Q1 EPS of $0.43 beats by $0.03. Revenue of $210M (-1%) in-line. Announces $100M share repurchase. Shares +5.1% AH. (PR)
- Annaly Capital Management (NLY): Q1 EPS of $0.56 beats by $0.01. Shares +1.1% AH. (PR)
- Assurant (AIZ): Q1 EPS of $1.17 misses by $0.26. Revenue of $2.09B (-4.1%) vs. $2.24B. Shares -3.7% AH. (PR)
- Biomed Realty Trust (BMR): Q1 FFO of $0.51 beats by $0.06. Revenue of $94M (+39.4%) vs. $85M. (PR)
- Boston Properties (BXP): Q1 FFO of $1.36 beats by $0.11. Revenue of $377M (+1.6%) vs. $366M. (PR)
- CB Richard Ellis Group (CBG): Q1 EPS of -$0.03 misses by $0.05. Revenue of $890M (-27.7%) vs. $983M. Shares -0.15% AH. (PR)
- Cliffs Natural Resources (CLF): Q1 EPS of -$0.07 beats by $0.07. Revenue of $465M (-6%) vs. $528M. Shares -2.5%. (PR)
- Citrix Systems (CTXS): Q1 EPS of $0.32 beats by $0.01. Revenue of $369M (-2.1%) vs. $359M. Announces up to $300M share buyback. Shares +5.1% AH. PR)
- Covance (CVD): Q1 EPS of $0.63 beats by $0.02. Revenue of $441M vs. $429M. Sees full-year EPS of $2.50-2.70 vs. consensus of $2.88. Shares flat AH. (PR)
- Crown Castle International (CCI): Q1 EPS of $0.02 beats by $0.08. Revenue of $403M (+8.7%) vs. $392M. Shares +7% AH. (PR)
- Duke Realty (DRE): Q1 FFO of $0.50 in-line. Revenue of $238M (+5%) vs. $219M. Sees full-year FFO of $1.85-2.15 vs. $1.81. Shares flat AH. (PR)
- Equity Residential (EQR): Q1 FFO of $0.57 beats by $0.02. Revenue of $515M (+2.5%) vs. $523M. Shares flat AH. (PR)
- Express Scripts (ESRX): Q1 EPS of $0.86 beats by $0.04. Revenue of $5.42B (-1.2%) in-line. Full-year guidance in-line. Shares +1.3% AH. (PR)
- First Solar (FSLR): Q1 EPS of $1.99 beats by $0.48. Revenue of $418M (+112.4%) vs. $403M. Shares +13.4% premarket. (PR)
- Flextronics International (FLEX): FQ4 EPS of $0.03 misses by $0.01. Sees FQ1 revenue of $5-6B vs. $6.2B consensus. Shares -3.3% AH. (PR)
- Genco Shipping (GNK): Q1 EPS of $1.32 beats by $0.06. Revenue of $96.7M (+5.4%) vs. $96M. Shares +0.5% AH. (PR)
- Green Mountain Coffee Roasters (GMCR): FQ2 EPS of $0.50 beats by $0.14. Revenue of $193M (+60%) vs. $178M. Sees full-year EPS of $1.47-1.53 vs. $1.31. Shares +20.4% AH. (PR)
- Harman International (HAR): FQ3 EPS of -$0.84 misses by $0.40. Revenue of $598M (-42.1%) vs. $668M. Suspends dividend. Shares -4.7% AH. (PR)
- JDS Uniphase (JDSU): FQ3 EPS of -$0.03 in-line. Revenue of $281M vs. $285M. Sees FQ4 revenue of $265-285M vs. consensus of $290M. Shares -12% AH. (PR)
- Kaiser Aluminum (KALU): Q1 EPS of $0.81 vs. consensus of $0.42. Revenue of $266M (-33.4%) vs. $277M. Shares +1.7% AH. (PR)
- LSI Logic (LSI): Q1 EPS of -$0.03 beats by $0.01. Revenue of $482M vs. $469M. Shares -0.2% AH. (PR)
- Northeast Utilities (NU): Q1 EPS of $0.60 beats by $0.05. Revenue of $1.59B (+4.8%) in-line. Shares -4.9% AH. (PR)
- Oceaneering International (OII): Q1 EPS of $0.80 beats by $0.12. Revenue of $435M (-0.2%) vs. $461M. Shares flat AH. (PR)
- O'Reilly Automotive (ORLY): Q1 EPS of $0.47 beats by $0.07. Revenue of $1.16B (+80.1%) in-line. Shares +3% AH. (PR)
- Owens-Illinois (OI): Q1 EPS of $0.55 beats by $0.19. Revenue of $1.52B (-22.5%) vs. $1.66B. Shares +11.3% AH. (PR)
- ProLogis (PLD): Q1 EPS of $0.66 misses by $0.04. Revenue of $455M vs. $245M. Shares -3.5% AH. (PR)
- Realty Income (O): Q1 EPS of $0.45 misses by $0.01. Revenue of $82.9M vs. $81.9M. (PR)
- Ryland Group (RYL): Q1 EPS of -$1.76 misses by $0.74. Revenue of $265M (-36.3%) vs. $235M. Shares -1.8% AH. (PR)
- Skechers (SKX): Q1 EPS of $0.18 beats by $0.27. Revenue of $343M (-10.8%) vs. $333M. "We are continuing to monitor our expenses and inventory levels to ensure maximum profitability in this soft economic environment, which we believe will continue to negatively impact our business." Shares +5.6% AH. (PR)
- Smith & Nephew (SNN): Q1 EPS of $0.13 misses by $0.49. Revenue of $865M (-5%) vs. $902M. Shares +0.45% premarket. (PR)
- Starbucks (SBUX): FQ2 EPS of $0.16 beats by $0.01. Revenue of $2.3B in-line. Shares +1.5% AH. (PR)
- STMicroelectronics (STM): Q1 EPS of -$0.31 beats by $0.02. Revenue of $1.66B (+33%) in-line. (PR)
- Taubman Centers (TCO): Q1 EPS of $0.70 beats by $0.12. Revenue of $158M (+0.2%) vs. $146M. Shares -0.3% AH. (PR)
- Teradyne (TER): Q1 EPS of -$0.38 beats by $0.02. Revenue of $121M (+59.4%) in-line. Shares +3.7% AH. (PR)
- Unum Group (UNM): Q1 EPS of $0.62 beats by $0.02. Revenue of $2.45B vs. $2.57B. Shares -0.1% AH. (PR)
- Visa (V): FQ2 EPS of $0.73 beats by $0.09. Revenue of $1.65B (+13.4%) in-line. Affirms full-year outlook - high-single digits in 21009 and the lower range of 11-15% in 2010. Volume growth of $675B down 1% Y/Y. Shares -0.1% AH. (PR)
- Walter Industries (WLT): Q1 EPS of $1.36 beats by $0.51. Revenue of $290M (+20.7%) vs. $316M. Shares +6.6% AH. (PR)
- Whiting Petroleum (WLL): Q1 EPS of -$0.92 misses by $0.20. Revenue of $164M in-line. (PR)
Overseas markets posted strong gains Thursday, and futures are sharply higher.
- Asia: Nikkei +3.94% to 8,828. Hang Seng +3.77% 15,521. Shanghai +0.38% to 2,478. BSE closed.
- Europe at midday: London +2.3%. Paris +1.7%. Frankfurt +2.7%.
- Futures at 7:00: Dow +1.7% to 8260. S&P +1.8% to 885. Nasdaq +1.9%.
- Crude +1.7% to $51.82. Gold -1% to $891. 30-year Tsys -0.22%. 10-year -0.28%. 5-year -0.19%. 2-year -0.05%.
- Euro +0.2% vs. dollar. Yen -0.6%. Pound +0.4%.
Thursday's Economic Calendar
- 8:30 Personal Income and Outlays
8:30 Employment Cost Index
8:30 Jobless Claims
9:45 NAPM Chicago Business Barometer
10:30 EIA Natural Gas Report
3:00 PM Farm Prices
3:45 PM Volcker speaks on US-China cooperation in the global crisis
4:30 PM Money Supply
- Notable earnings before Thursday's open: APA, ASH, AZN, BC, BWA, CAH, CELG, CI, CINF, CL, CLI, CMCSA, CMS, COCO, COV, CTL, D, DLR, DOW, EK, ENTG, EQT, ERIC, EXPE, FAF, GTI, HOT, HP, IP, IRM, K, KBR, KIM, KSU, LKQX, LNT, MRO, MOT, MYL, NBL, NEM, NRG, NWL, NYX, OC, OCR, OMX, OSK, PDE, PEI, PG, PTEN, RGC, RYN, SEPR, SPR, SWY, TRV, TSM, TYC, VIA.B, WMB, WPI, XEL, XOM
- Notable earnings after Thursday's close: ACS, ARBA, BGC, BMRN, CPT, CQB, DLB, ESLR, FISV, FR, HIG, IDTI, IM, MET, MFE, MTW, MXIM, PKI, QLGC, RSG, TEG, VSEA, XRAY
Seeking Alpha editor Eli Hoffmann contributed to this post.
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