Bank regulators are expected to finalize rules today that would require banks to hold capital against every asset on their books, and approve of a "liquidity-coverage ratio", which would require large banks to load up on ultra-safe assets to fund their operations for 30 days. The new rules have Wall Street concerned due to the likely harm to earnings and lending restrictions, although regulators say the policies will create a safer financial system.
Russian stocks are soaring following President Poroshenko's and Vladimir Putin's permanent ceasefire agreement in the Donbass region of eastern Ukraine. It wasn't immediately clear if Russia now acknowledges direct involvement in Ukraine due to the ceasefire. The dollar-denominated RTS index is up 3.9% at 1223.41, while its ruble-based peer MICEX is 2.5% higher at 1,435.04. Earlier this morning, the FTSE hit a 14-year high, rising 1% to 6,897.
Meanwhile, the European Commission will debate Wednesday to what areas to impose new sanctions against Russia, before sending the list to national capitals for approval at the end of the week. New restrictions proposed include expanding the ban on Russian companies accessing the European capital markets and the blacklist of dual-use goods, denying use of European oil companies for deep-sea drilling, and possibly boycotting Russia from hosting the 2018 World Cup.
Coinciding with the sale of its last tobacco product today, CVS Caremark (NYSE:CVS) is unveiling its new corporate name: CVS Health. CVS said in February that it would rid all of its 7,700 stores of tobacco products by Oct. 1, but in the end decided to eliminate them one month ahead of schedule. Although the move will cost the retail chain $2B in annual sales, CVS is banking that the distinction can help it win business in other parts of the company.
BP is trying to remove the administrator of compensation payments under its settlement for the 2010 Gulf of Mexico oil spill, accusing him of a “clear-cut conflict of interest” that he had failed to fully disclose. In a filing to the U.S. court in New Orleans hearing the case over the spill, BP (NYSE:BP) says emails reveal that Patrick Juneau had previously “advocated vigorously on behalf of individual and business claimants seeking compensation from BP for alleged spill-related injuries."
JPMorgan is in talks to sell its oil-supply agreement with Philadelphia Energy Solutions to Bank of America (NYSE:BAC). Operated as a joint venture between Sunoco and the Carlyle Group (NASDAQ:CG), Philadelphia Energy Solutions is one of the largest refineries in the country, processing 330K barrels of crude a day. Under the terms of the current agreement, JPMorgan (NYSE:JPM) supplies the refinery with crude oil and credit and receives refined fuel products that it can trade.
The FBI has not yet found evidence that suggests the hacker(s) who successfully breached the computer system at JPMorgan Chase (JPM) attained similar successes against other big U.S. banks, reports the WSJ. A source says that the JPMorgan incident was at first conflated with suspicious activity related to other banks, but as the investigation continued, the threats appeared to be separate.
Home Depot is working with law enforcement officials to investigate a potential breach of customer credit card and debit card information. Early reports indicate the breach occurred in late April and could involve over 2,000 stores. Home Depot (NYSE:HD) says it is looking into what it called "unusual activity" and if it confirms a breach occurred, it will immediately notify customers.
After returning as executive chairman of Luxottica following the exit of CEO Andrea Guerra, founder Leonardo Del Vecchio says he is now eyeing acquisitions and plans to double the group’s revenues to more than €14B over the next decade. Del Vecchio sees much of the desired revenue increase coming from Luxottica's (NYSE:LUX) organic growth but is looking for acquisitions "that does something different for us."
The British government is signing a £3.5B ($5.8B) defense contract with General Dynamics (NYSE:GD) for 589 new armored vehicles, the army's largest order for such vehicles in over 30 years. The vehicle deliveries are planned to start in 2017 and will be the army's first fully digitalized armored vehicles.
German internet service provider United Internet, has agreed to acquire full control of Versatel, a company which owns Germany's second-largest fiber optic cable network. United Internet (OTC:UDIRY), which announced it was considering the takeover last month, will now acquire the 74.9% of Versatel it didn’t already own from KKR (NYSE:KKR) for €586M ($769M) in cash.
Danaher has appointed Thomas Joyce as President and CEO, implementing its succession plan sooner than expected. Danaher (NYSE:DHR) initially announced the succession plan in April, indicating that then-CEO Lawrence Culp would retire next March, but Chairman Steven Rales says the transition has proceeded well and the board determined Joyce is ready to take the reins.
After receiving antitrust approval in Japan, Lufthansa Cargo (OTCQX:DLAKY) and All Nippon Airways are forming a freight services joint venture between Europe and Japan to reduce the costs of a stuttering cargo market. Lufthansa Cargo said earlier in the year that it intends to launch its first partnership deal in 2014, with a second to follow in 2015. This past July, Lufthansa entered talks with United Continental's (NYSE:UAL) cargo operations.
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In Asia, Japan +0.4% to 15728. Hong Kong +2.3% to 25318. China +1% to 2289. India +0.4% to 27135.
In Europe, at midday, London +0.8%. Paris +1.2%. Frankfurt +1.3%.
Futures at 6:20: Dow +0.3%. S&P +0.3%. Nasdaq +0.3%. Crude +0.8% to $93.62. Gold +0.3% to $1268.20.
Ten-year Treasury Yield +3 bps to 2.46%
Today's economic calendar:
7:00 MBA Mortgage Applications
7:45 ICSC Retail Store Sales
8:15 ADP Jobs Report
8:30 Gallup U.S. Job Creation Index
8:55 Redbook Chain Store Sales
10:00 Factory Orders
2:00 PM Fed's Beige Book
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