- Toyota slapped with heavy fine. Regulators are fining Toyota (NYSE:TM) $16.4M for allegedly hiding gas-pedal problems from safety officials for four months. The fine is the largest allowed by law against an automaker, and far exceeds the previous record of $1M. Transportation Secretary Ray LaHood said "we now have proof that Toyota failed to live up to its legal obligations. Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families." Regulators are still investigating Toyota's other recalls, and additional fines are possible. TM -0.5% premarket (7:00 ET).
- Another Toyota recall. South Korea is ordering the recall of 13,000 Toyota cars for potential defects that could trap the gas pedal under the floor mat. Toyota, which for weeks had insisted the vehicles it sold in South Korea didn't have safety problems, apologized to South Korean consumers for the "inconvenience."
- Peabody raises Macarthur bid... Peabody Energy (BTU) raised its bid this morning for Australia's Macarthur Coal, after its earlier unsolicited offer of A$3.3B ($3B), or A$13 per share, was rebuffed. The new bid would give Macarthur shareholders A$14 per share in cash, valuing Macarthur at A$3.56B. Macarthur said it will consider the new offer and advised shareholders to take no action until the board makes a recommendation.
- ...while Noble pushes forward on Gloucester. Noble Group (OTCPK:NOBGF) is trying to become Macarthur Coal's largest shareholder by acquiring the 12.3% it doesn't already own of Gloucester Coal, which has agreed to be acquired by Macarthur. Just hours before Peabody Energy's (BTU) improved offer for Macarthur, Noble moved to secure its Gloucester ownership by offering A$127M ($117.5M), or A$12.60/share, for the remaining stake, and issued two unusually fiery and informal press releases (I, II) attacking Peabody's offer for Macarthur. Macarthur shareholders are scheduled to vote on the Noble/Gloucester deal at an April 12 shareholder meeting, which may now be delayed in light of Peabody's improved bid. (Read Peabody's response to Noble's press release)
- Greece wants to change EU aid deal. Greek officials reportedly want to change the terms of an EU aid deal reached last month in order to bypass IMF involvement. Sources said Greece is concerned the IMF will impose tough conditions in exchange for aid that "might cause social and political unrest." Instead, the Greek government will try to arrange a clearer European mechanism that would sidestep the IMF. Said one Greek official: "There is a strong chance that Greece might be forced to ask for financial support after all, despite official statements to the contrary, and it is essential that the terms and conditions be clear." Separately, Greece is marketing itself as an emerging economy and is targeting U.S. investors in a $5B-10B bond sale to help cover its May borrowing requirement of about €10B ($13.4B). It will be Greece's first issuance in the U.S. in nearly two years.
- Aussie rate hike. Australia's central bank raised its benchmark rate 25 basis points to 4.25%, the fifth increase out of the last six meetings. Reserve Bank of Australia Governor Glenn Stevens downplayed concerns that the higher rates are already hurting consumer spending, and signaled further increases.
- Regulators take closer look at Schlumberger-Smith merger. Schlumberger (NYSE:SLB) said yesterday its proposed merger with Smith International (SII) will receive a second look by antitrust regulators, ensuring several more months of scrutiny. The companies still expect the deal to close in the second half of this year.
- Maguire offer lifts shares. Maguire Properties (NYSE:MPG-OLD) rose 9.4% yesterday after former CEO and founder Robert Maguire offered to assume the loans on three of the company's office buildings that he says may wind up in default. Maguire said the move would free up over $60M in cash that the company would otherwise be forced to spend paying down debt on the buildings. The offer will be discussed at a board meeting later today.
- Daimler-Renault-Nissan alliance moving forward. Daimler (DAI), Renault (OTC:RNSDF) and Nissan (OTCPK:NSANY) are expected to announce as soon as tomorrow their plans to cooperate on small cars and exchange minority stakes in each other, and Renault's board will reportedly meet today to finalize the matter. The pact could create "billions of euros" in savings. Rumors of the alliance have been widely reported by financial media.
- Shell, PetroChina say no approval yet for Arrow bid. Royal Dutch Shell (NYSE:RDS.A) and PetroChina (NYSE:PTR) denied a media report that they had already received regulatory approval for their proposed A$3.45B ($3.2B) acquisition of Australia's Arrow Energy. A spokesman for the Shell/PetroChina joint venture vehicle said an application was filed with the Foreign Investment Review Board last week, and that the foreign investment watchdog usually takes between one to four months to decide on takeover applications. RDS.A -0.5% premarket (7:00 ET).
- U.K. elections called for next month. British Prime Minister Gordon Brown asked Queen Elizabeth today to dissolve parliament on April 12, setting the stage for a general election on May 6. Polls show the gap is quite small between Brown's Labour party and the opposition Conservatives; a hung parliament could give the already-downtrodden pound a further shellacking and hurt financial markets by leaving Britain unable to effectively rein in its record deficit. The move will also delay the Bank of England's Monetary Policy Committee meeting from May 5-6 to May 7 and 10. The pound is -0.9% against the dollar (7:00 ET).
- Apartment rents start to rebound. Apartment rents rose 0.3% nationwide in Q1, ending five consecutive quarters of declines and suggesting the worst may be over as "deterioration seems not to have just been arrested but reversed." The increase came during what is usually a seasonally weak period for apartments, indicating improvements may be even more pronounced in Q2 and Q3. The apartment vacancy rate remained at an all-time high of 8%.
- In Asia, Nikkei -0.5% to 11282. Shanghai flat at 3159. BSE flat at 17941. Hang Seng closed.
- In Europe at midday, London +0.6% to 5779. Paris +0.6% to 4057. Frankfurt +0.2% to 6250.
- Futures: Dow -0.1%. S&P -0.2%. Nasdaq -0.2%. Crude -0.3% to $86.34. Gold -0.8% to $1124.70.
Tuesday's Economic Calendar
7:45 ICSC Retail Store Sales
8:55 Redbook Chain Store Sales
12:00 PM Fed's Kocherlakota: 'Economic Recovery and Balance Sheet Normalization'
1:00 PM 3-Year Note Auction
2:00 PM FOMC Minutes
5:00 PM ABC Consumer Confidence Index
Seeking Alpha editors Eli Hoffmann and Jason Aycock contributed to this post.
Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.