Wall Street Breakfast: Must-Know News

• G-8 discuss stimulus exit strategies. The G-8 finance ministers began drawing up plans to roll back stimulus measures and budget deficits amid continued signs of economic recovery. Officials said it's prudent to consider a 'credible exit strategy,' though the ministers agreed that putting any plans into effect now would be premature, with Geithner and the U.K.'s Darling the most vocal in warning officials not to move too soon. The G-8 ministers also issued their most upbeat outlook since Lehman's collapse in September. (Read the G-8 finance ministers' statement)
• Citi teams up with IFC. Citigroup (C) launched a $1.25B funding tie-up with the International Finance Corporation, the private sector arm of the World Bank. Under the deal, Citi will provide $750M to banks in Asia, the Middle East, Africa and Latin America over three years. The partnership is part of a $50B global trade finance initiative announced by the World Bank in April, and shows the increased willingness by banks to finance trade in emerging markets.
• Unrest in Iran. Clashes broke out in Iran after President Mahmoud Ahmadinejad claimed re-election victory amid allegations of vote-rigging. Ahmadinejad's main challenger, former premier Mir Hossein Mousavi, urged crowds to stay 'calm' despite 'obvious violations' in the voting process which saw Ahmadinejad win 63% of the vote vs. Mousavi's 34% in what was expected to be a tight race.
• Icahn eyes Delphi. Activist investor Carl Icahn is reportedly considering making another attempt to take over bankrupt auto parts supplier Delphi. A bankruptcy judge told Delphi last week to open the sale of its assets to other potential bidders to compete with an offer by Platinum Equity. Icahn's auto-parts company, Federal-Mogul Corp, had held recent discussions with Delphi before the Platinum deal was announced.
• Pfizer looks to emerging mkts. Pfizer (PFE) is looking to reach deals in 'the next few months' to help it raise its share of the $80B drug industry in emerging markets. Pfizer's redirected attentions are part of a larger trend as pharmaceuticals face tougher conditions in more mature markets.
• IBM has its head in the clouds. IBM will begin rolling out some initial products and services for tailored cloud computing this week. Though many large firms and government agencies have thus far been reluctant to go for cloud computing because of security and reliability concerns, IBM hopes to attract customers with the promise of a 70% reduction in PC power needs and a 40% reduction in technical support costs.
• BRIC wants beefed up role. Leaders from Brazil, Russia, India and China will meet this week for their first formal summit. BRIC countries will discuss ways to reshape the world's financial system and ideas for a new reserve currency, with an eye towards playing a larger role on the global stage.
• Cemex's concrete sale. Swiss cement maker Holcim agreed to buy the Australian operations of Mexican rival Cemex (CX) for 2.02B Australian dollars ($1.64B). The deal will close after regulatory approval and a due diligence process.
• Eurozone joblessness rises. Eurozone employment fell 0.8% in Q1, the third quarter in a row of falling employment and the largest decline since records began in 1991. Spain did the worst, with employment falling 3.1% on the quarter and 6.4% Y/Y.

Today's Markets

Overseas markets were mostly weaker Monday.

• Asia: Nikkei -0.95% to 10,040. Hang Seng -2.07% to 18,499. Shanghai +1.67% to 2,790. BSE -2.38% to 14,876.
• Europe at midday: London -1.6%. Paris -1.8%. Frankfurt -2%.
• Futures: Dow -1.2% to 8637. S&P -1.2% to 929. Nasdaq -1.1%.
  Crude -1.3% to $71.11. Gold -0.7% to $934.
  30-year Tsy +0.25%. 10-year +0.22%. 5-year +0.17%. 2-year +0.13%.
  Euro -1.1% vs. dollar. Yen +0.2%. Pound -0.7%.

Monday's Economic Calendar

• 8:30 Fed's Evans speaks on the financial crisis
  8:30 Empire State Mfg Survey
  9:00 Treasury International Capital
  1:00 PM NAHB Housing Market Index

Seeking Alpha editor Eli Hoffmann contributed to this post.

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Comments

[mac123449:]

Time for a plunge.

Jun 15 09:40 AM

[David White:]

On Friday news came out near the end of regular hours that the more moderate candidate for Iranian President, Mousavi, had won. On Saturday President Mamoud Ahmadinejad claimed victory by an approximate 2 to 1 margin. Mousavi is claiming the election was rigged.

At first the Supreme spiritual leader, Ayatollah Ali Khamenei, urged people to unite behind President Ahmadinejad. This morning Ayatollah Ali Khamenei called for an investigation into allegations of election fraud. It is unclear how this investigation will proceed.

Jun 15 09:47 AM

[AndrewBaker:]

Our governments will continue to tell us that all is going well, that the stimulus is working and that we'll be out of recession anytime soon, whenever that will be; and the BRICs will muscle in on getting any changes made such that they come out of it better (and it's interesting that Jim O'Neill, chief economist at Goldman Sachs, invented the term BRIC in 2001 when he forecast that Brazil, Russia, India and China would overtake some of the world's top economies in the first half of the 21st century, becoming building blocks of a new world order), which is what will happen. So ... where's the alpha right now?

My answer is cloud computing.

Who wants to continually update software, back-up data, hold multiple copies of files (which increases the risk of error), integrate data files so that we can analyze, distribute, write about and otherwise do our work, and have to travel to where our computer is housed in order to access it all, when it's possible to work from anywhere we choose in the world without being bothered by any of the above? With cloud computing, you can. A terminal with keyboard and screen is all you need (using anyone's printer, if needed, via bluetooth/infrared). Security issues are highly important, and treated as such, but given this, the ease and simplicity that a dumb terminal system offers means that the best currently small companies in this field will be multi-baggers in a short period of time, with the bigger ones being very profitable also.

Companies to consider include: Amazon, AT&T, Enomoly,Google, GoGrid, Microsoft, Net Suite, Rackspace, RightScale, Salesforce.com, and my personal best choice, VMWare.

Disclosure of Interest: I hold VMWare, and may hold all or any of the others in the future.

Jun 15 10:27 AM

[Sovestor:]

Market will go back up tomorrow. USD strength is not a sign of weakness for US stocks. On the contrary, it shows increasing demand for US Dollar now to invest in undervalued US-denominated assets in the US sooner or later.

Jun 15 11:42 AM

[bbowen7:]

Re: Geithner and Darling's warning for the G8 to not adopt prudent fiscal policies too soon: As the Obama administration says, "A good crisis is a terrible thing to waste", and until the healthcare and energy initiatives get passed, we've got to keep the crisis alive.

There are three parts of the cycle at work here - a major recession as part of the business cycle (reaching bottom); massive economic stimulus (just starting to be implemented); future massive spending on the Left's agenda (on the horizon). Obama needs to merge the three in the public's mind to be successful.

Jun 15 12:47 PM

[Joseph Sherman:]

BRIC wants beefed up role. - How will this change what "Made in Brazil", "Made in Russia", "Made in India", and "Made in China" mean in the future?

Jun 15 04:33 PM

[backtoreality:]

joe...

what bric means is ..cheap junk,,,made with cheap foriegn labor.

I had to buy 3 potato peelers.all made in china....from 3 different hardware stores..before i got one strong enough to peel a potato without bending.

why can't they make a potato peeler.??? because poor people in bric countries never saw, and don't know what a potato peeler is.....when you live in a poor country..you eat the potato peels.


On Jun 15 04:33 PM Joseph Sherman wrote:

> BRIC wants beefed up role. - How will this change what "Made in Brazil",
> "Made in Russia", "Made in India", and "Made in China" mean in the
> future?

Jun 15 05:13 PM