Inflation falls in Germany, Italy and the U.K. CPI reports from Germany, Italy and the U.K. showed that inflation dropped in October, providing further strength to those who believe that central-bank policy should continue to be accommodative. In Germany, CPI slowed to the lowest rate since August 2010, easing to +1.2% on year from +1.4% previously. Italian inflation edged down to +0.8% from +0.9%. In both countries, CPI shrank on month. In Britain CPI weakened to +2.2% from +2.7% and dropped closer to the Bank Of England's target of 2%.
Vodafone's core profit falls 4.1%. Vodafone's (VOD) H1 EBITDA dropped 4.1% to £6.6B but topped consensus of £6.4B, while revenue rose 1.2% to £22.03B. In Q2, service revenue dropped 4.9%, due to regulator-imposed price cuts and strong competition in Italy, Spain, Germany, Turkey and Britain. The U.K. telecom carrier intends to invest £7B by March 2016 in order to improve its network. Shares were +1.1% premarket.
China sees bigger role for markets. China's government has pledged to allow markets to play a "decisive" role in allocating resources as part of "comprehensively deepening reforms" that the country's leaders have been discussing at a major four-day meeting that ended today. In the past, China had said that markets would play a "basic" role, so the new language seems to represent an upgrade. China's leaders are aiming for "decisive results" by 2020.
Top Stock News
T-Mobile US could raise almost $2B in stock offering. T-Mobile US (TMUS) plans to offer 66.15M shares, which could bring in proceeds of $1.96B based on yesterday's closing price of $29.67. The number four U.S. carrier intends to use the money for "general corporate purposes," including capex and opportunistic spectrum purchases. T-Mobile US has been spending aggressively to expand its 4G network - with the goal of neutralizing Verizon's (VZ) and AT&T's (T) head start - and to grow its retail presence. Shares were -2.6% premarket.
Vale selling Norsk Hydro holding for $1.8B. Vale (VALE) has sold a 19.6% holding in Norwegian aluminum-maker Norsk Hydro (OTCQX:NHYDY) for 10.18B Norwegian kroner ($1.66B). If a greenshoe option is exercised, Vale will have sold its entire 21.6% interest for $1.82B, or little more than half the $3.53B value of the stake when the Brazilian mining company acquired it in 2011. The divestment is part of Vale's strategy of selling non-core assets, putting projects on hold, and focusing on its more profitable iron-ore operations.
News Corp.'s revenues disappoint, shares drop. News Corp.'s (NWSA) revenues fell a greater-than-expected 3% to $2.26B in FQ1 - the first quarter after the company split from Fox (FOX) - hurt by a sharp fall in sales at its Australian newspapers. Adjusted EPS of $0.03 also missed consensus. Still, News Corp. swung to a net profit of $27M from a loss of $92M last year, although that hasn't stopped shares from sliding 1.55% premarket.
New trial starting in Apple vs Samsung battle. Apple (AAPL) and Samsung (OTC:SSNGY) are back in court in the U.S. over how much the latter should pay for breaching Apple's patents. Jury selection started last Tuesday and is expected to last a week. In August 2012, the jury in a previous trial awarded Apple over $1B, a sum that the judge later reduced to $600M after vacating $450M because she was unclear about how the amount was calculated. The latest trial is over how much more Samsung needs to pay.
Top Economic & Other News
Obamacare enrollment miles away from goals. Fewer than 50,000 people had reportedly managed to enroll in private insurance plans via the government's problem-plagued HealthCare.gov Web site as of last week. The number represents less than 10% of the 500,000 people that had been projected. Twelve of the 14 states that are operating their own exchanges have signed up 49,000. The total is therefore also well below the initial target, which was 800,000. The Congressional Budget Office's prediction of 7M enrollments by March seems like a distant dream.
Bank of France forecasts growth in final quarter. The Bank of France has predicted Q4 GDP growth of 0.4%, and said that its business-climate indicator for industry rose to 99 in October from 97 in September. The services sector indicator held steady at 93. Business leaders are confident that industrial and services activity will continue to expand in November. However, the CAC 40 was -0.4% at the time of writing.
Alpha-Rich Stock Movers and Great Calls
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In Asia, Japan +2.2% to 14589. Hong Kong -0.7% to 22901. China +0.8% to 2127. India -1% to 20282.
In Europe, at midday, London -0.3%. Paris -0.3%. Frankfurt -0.3%.
Futures at 6:20: Dow -0.1%. S&P -0.2%. Nasdaq -0.2%. Crude -0.25% to $94.90. Gold -0.1% to $1280.
Ten-year Treasury Yield +4 bps to 2.8%.
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