Barclays suffers major breach as 27,000 client files stolen. Hackers have stolen up to 27,000 Barclays (BCS) client files and sold the information to rogue traders who are using the information to pressure investors into scams, the U.K.'s Daily Mail newspaper reports. The data includes earnings, savings, mortgages, health issues, insurance policies, and passport and national insurance numbers. Barclays could now be hit with unlimited penalties for the breach. However, investors seem unworried, with shares +1% premarket.
WSJ: Sprint has second thoughts about T-Mobile deal. Sprint (S) is rethinking its attempt to buy T-Mobile US (TMUS) from Deutsche Telekom (OTCPK:DTEGF) after the Justice Department and the FCC expressed skepticism that the acquisition would be allowed, the WSJ reports. Sprint could still try to purchase T-Mobile, but executives will take their time in order to refine their strategy and antitrust arguments.
NYT: Dimon ensnared in China hiring controversy. A top Chinese insurance regulator asked JPMorgan (JPM) CEO Jamie Dimon for the bank to hire a family friend as a favor at a time that the firm was trying to win lucrative work from insurance companies in China. Dimon replied that the bank would "do what we can," and the applicant received an internship and then a job. However, JPMorgan said Dimon had nothing to do with the decision to recruit the applicant, and a source says he is not suspected of wrongdoing.
Top Stock News
Barclays' adjusted pretax profit £5.2B in 2013. With Barclays (BCS) drowning in headlines about its massive data breach, the bank disclosed that it made an adjusted pretax profit of £5.2B ($8.52B) in 2013, below analyst consensus of £5.4B and 2012's figure of £7.05B. Statutory pretax earnings jumped to £2.9B from £246M. The bank provided no further details, although it will release full results tomorrow. Last month, Barclays said it would take a £330M Q4 charge related to regulatory penalties and lawsuits.
Toyota to follow Ford and GM out of Australia. Toyota (TM) intends to end the production of cars and engines in Australia by the close of 2017, due to high costs, the strong Australian dollar and low economies of scale. Toyota's move is not a huge surprise after the Japanese company warned about the future of its Australian operations last year following the announcement of similar plans by Ford (F) and GM (GM). However, the exit of the auto giants probably means the collapse of Australia's car industry.
Report: Vodafone makes formal bid for Spain's ONO. Vodafone (VOD) has made a formal offer for Spanish cable operator Grupo Corporativo ONO, the Expansion newspaper reports. However, Reuters sources provide conflicting information: one says that talks are continuing, while two others say that no proposal would be made. Vodafone is vying with Liberty Global (LBTYA) to acquire ONO, which has also been considering an IPO. Any deal could be worth an estimated €6.4B ($8.7B) including debt.
Proxy advisory firms back Apple over Icahn's $50B buyback plan. Apple (AAPL) has received a boost after proxy-advisory firms Institutional Shareholder Services and Egan-Jones counseled investors to follow Apple's recommendation and reject Carl Icahn's proposal that the company repurchase $50B in shares. ISS cited Apple's buybacks and dividend payments as a reason for its opinion. The company repurchased $14B in stock in the fortnight after releasing its latest quarter earnings results, and it has acquired $40B over the past year.
Top Economic & Other News
PBOC to tolerate "reasonable interest-rate volatility." The People's Bank of China is prepared to tolerate "reasonable" volatility in money-market interest rates as it attempts to rein in soaring debt in the country. While the PBOC will ensure "appropriate liquidity," it won't fund growth that is dependent on investment and debt. The PBOC's remarks come after repurchase rates spiked to high levels at various points over the past several months, causing ructions in stock markets.
BOF: France returned to growth in Q4; however, recovery weak. The Bank of France has estimated that the country's GDP rose 0.2% in Q4 after a fall of 0.1% in Q3. However, industrial output contracted 0.3% on month in December after rising 1.2% in November and missed consensus that production would show no change.
Japan's current-account gap hits record. Japan's current-account deficit widened to a record ¥638.6B ($6.2B) in December from ¥592.8B in November, partly due to surging imports - particularly of energy - and the weak yen. Consensus was for ¥685.4B. The fear is that the deficit will become permanent and hurt investor confidence in Japan - which would be rather dangerous given the country's massive debt.
Millions earn too little to receive health-coverage help. Around 4.8M people aged 18-64 get no government help to buy medical insurance - because they earn too little to qualify for federal subsidies. However, they earn too much to receive benefits under state programs. The gap is the result of 24 states deciding not to expand Medicaid coverage under the Affordable Care Act. However, some states are revisiting their policies in order to cover the hole, which hospitals see as a threat to their revenues.
"Quit rate" hits post-recession peak. The proportion of workers who voluntarily left their jobs - known as the "quit rate" - rose to a post-recession high of 1.8% in November. That compares with a low of 1.2% in September 2009 but is well under the average of 2.1% from 2000-2006. Some economists, including new Fed Chief Janet Yellen, view the quit rate as an indicator of the state of the labor market. The theory is that many people resign their jobs either because they have a new one or are confident of finding another position.
Top Ideas: Movers and Great Calls
1) On December 30, Helix Investment Research highlighted Crédit Agricole's (OTCPK:CRARY) falling exposure to sovereign debt and its growing retail profits. Shares in the French bank are +11% since. Read article »
2) Mike Arnold wrote in September that boardsport retailer Billabong (OTCPK:BLLAY) had far more value in its turnaround plan than accounting principles allowed it to report. On Friday, investors cheered positive restructuring news and shares rose on heavy volume; the stock is +47% to date. Read article »
Top Ideas To Watch
1) MeetMe (MEET) is posting mobile revenue growth and engagement levels well above peers; Inflection Point Investing says multiple catalysts could lead shares to double. Read article »
2) Fund manager Saj Karsan says investors have misinterpreted temporary problems as a "new normal" at retailer hhgregg (HGG); as margins rebound, the stock should too. Read article »
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In Asia, Japan +1.8% to 14718. Hong Kong -0.3% to 21579. China +2% to 2087. India -0.2% to 20334.
In Europe, at midday, London +0.1%. Paris +0.2%. Frankfurt +0.2%.
Futures at 6:20: Dow -0.2%. S&P -0.3%. Nasdaq -0.1%. Crude -0.4% to $99.44. Gold +0.55% to $1272.70.
Ten-year Treasury Yield -2 bps to $2.67.
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