Eurozone exits recession as Germany, France, Portugal grow. Eurozone GDP expanded 0.3% on quarter in Q2, signaling an end to the region's recession. The growth represented a recovery from contraction of 0.3% in Q1 and topped consensus of +0.2%. Germany expanded again in Q2 after GDP was flat in Q1, boosted by domestic demand, fixed capital formation and a trade surplus. France exited recession, as did - most surprisingly - Portugal, whose economy grew 1.1%.
Carl iCahn stake in Apple worth over $1.5B. Carl Icahn's holding in Apple (AAPL), which he disclosed yesterday via Twitter, is worth over $1.5B, the WSJ reports. What Icahn - or as one wag on Twitter indicated, should it be iCahn? - wants is money, specifically for Apple to borrow cash to repurchase shares now. "This is a no-brainer to go buy stock in a company that can go borrow at a low rate," Icahn told the paper. "Even without earnings growth, we think it ought to be worth $625." Apple closed +4.75% yesterday at $489.57.
Top Stock News
Barclays CFO to leave six months early. Barclays (BCS) CFO Chris Lucas will leave the bank this week rather than in February, as planned, due to deteriorating health. Tushar Morzaria, who has been recruited from JPMorgan (JPM) to replace Lucas, will take over in October. Lucas' hastened departure comes as Barclays attempts to raise £5.8B through a rights issue in order to plug a £12.8B capital hole that was identified by the Bank of England. Shares were -0.4% premarket.
More problems found on 787. The glitches keep on turning up on the Boeing (BA) 787, with All Nippon Airways detecting an electrical wiring fault in fire extinguishers for engines of three Dreamliners. The carrier is analyzing whether the problem would have caused the extinguishers not to work properly in the event of a fire.
Court quashes approval of Liberty Global's €3.16B German purchase. A higher regional court in Duesseldorf in Germany has overturned the authorization by the country's cartel office of Liberty Global's (LBTYA) €3.16B ($4.2B) acquisition of KabelBW and ordered the regulator to have another look at the deal. The cartel office had approved the transaction at the end of 2011, imposing some tough conditions due to Liberty Global owning UnityMedia, Germany's second-largest cable operator.
Powerful KPN foundation concerned about America Movil bid. An independent foundation that has the ability to prevent America Movil's (AMX, AMOV) €7.2B acquisition of KPN (OTC:KKPNF) has expressed concern about the deal. "There is considerable uncertainty about America Movil's intentions," the foundation said, citing a lack of information, "including (about) KPN's intention to sell its German subsidiary E-Plus." The latter is due to be acquired by Telefonica (TEF).
Bloodletting continues at Zynga in major restructuring. New Zynga (ZNGA) CEO Don Mattrick has outlined a major restructuring in which COO David Ko, CTO Cadir Lee and HR chief Colleen McCreary are leaving the company. In a move that faintly resembles the revamp at Mattrick's former employer, Microsoft (MSFT), Mattrick is splitting Zynga's operations into three divisions: Functional; Studios; and Tech, Live Ops & Publishing. The departure of the executives follows an avalanche of management exits and layoffs over the past year.
RadioShack looking to refinance debt to avoid restructuring. RadioShack (RSH) is reportedly looking to refinance its debt with cheaper loans by the end of 2013. The struggling electronics chain has taken a beating as sales have lagged over the past year, but it believes it can avoid a restructuring if it can pay off its existing lenders and secure more favorable borrowing terms from new ones. Shares rose 4.4% in AH trading.
Hong Kong markets closed due to typhoon. Bourse operator Hong Kong Exchanges & Clearing canceled trading today due to the first typhoon of the year. The storm also caused flights to be scrapped. Elsewhere, Japanese shares closed 1.3% higher following a late surge, although Chinese stocks dropped 0.3%. European equities were mixed despite the eurozone's exit from recession, while U.S. stock futures were flat-to-lower.
Top Economic & Other News
BOE voted 8-1 in favor of forward guidance. The Bank of England's Monetary Policy Committee voted 8-1 in favor of adopting forward guidance, which includes a proposal not to raise interest rates from 0.5% until unemployment has dropped to 7% from 7.8% currently, subject to conditions related to inflation and financial stability. Some policy members believe there is a "compelling" case to restart bond purchases, although they held off calling for more QE in order to assess the effect of forward guidance.
U.K. unemployment stuck at 7.8%. As expected, U.K. unemployment held steady at 7.8% in April-June, the same rate as in January-March. The number of unemployed fell 4,000 to 2.51M. With the needle not moving despite GDP growth of 0.6% in Q2, BOE interest rates may well be staying at 0.5% for a while to come.
Alpha-Rich Stock Movers and Great Calls
1) Last Wednesday, Wall Street Advisors raised questions about ExamWorks' huge debt load and negative tangible book value, making the case for a strong short trade. Shares are -7.3% since. Read article »
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Alpha-Rich Stocks To Watch
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In Asia, Japan +1.3% to 14050. Hong Kong closed. China -0.3% to 2100. India +0.7% to 19368.
In Europe, at midday, London +0.1%. Paris +0.4%. Frankfurt +0.2%.
Futures at 6:20: Dow -0.1%. S&P -0.15%. Nasdaq flat. Crude -0.7% to $106.10. Gold +0.1% to $1322.10.
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