- Oil falls as Gaddafi regime teeters. Oil is down for a change, following reports from Asharq Al-Awsat and Al Jazeera that a negotiator has met with rebel leaders to declare Gaddafi's willingness to step down and leave Libya in return for his and his family's wealth and safety. Libyan state television has denied reports of the negotiations. Meanwhile, sources said Morgan Stanley (NYSE:MS) has stopped trading oil with Libya, and Exxon (NYSE:XOM), Marathon Oil (NYSE:MRO) and Conoco (NYSE:COP) have either cut off or greatly reduced their Libyan dealings in order to comply with U.S. sanctions. Qatar's oil minister said OPEC could ramp up supplies if need be, but at present, "figures show us there is no problem with supply - it is all speculation and psychology." Crude futures, which were down as much as 1% earlier this morning, are now -0.3% to $105.16 (7:00 ET).
- Urban Outfitters' earnings miss. Shares of Urban Outfitters (NASDAQ:URBN) plummeted in extended trading yesterday, after the company's Q4 earnings report showed the apparel retailer fell short of both earnings and revenue expectations (see details below, plus earnings transcript). Gross margins fell to 39.7% from 41.7% because of markdowns that were meant to clear out seasonal inventory and because of higher shipping costs due to an increase in international direct-to-consumer sales. Urban Outfitters posted sales growth in nearly every quarter of the recession, and this earnings miss, the first in two years, follows a muted Q3 performance. In after-hours trading, URBN -12%.
- New CEO for Hospira. Hospira (NYSE:HSP) announced late yesterday that Michael Ball would become the company's new chief executive officer and a member of the board, effective March 28, ending the CEO search that began last summer. Ball, who is currently the president of Allergan (NYSE:AGN), will succeed Christopher Begley, Hospira's founding CEO. Begley will assume the role of executive chairman.
- Icahn considers Federal-Mogul sale. Carl Icahn is reportedly in the early stages of exploring a sale of Federal-Mogul (NASDAQ:FDML), just over three years after the auto parts supplier emerged from bankruptcy. Icahn holds a 76% stake in Federal-Mogul and has hired financial advisers to sound out potential buyers, but sources say the company hasn't yet launched a formal sale process. In yesterday's trading, FDML +6.4%.
- Barnes & Noble fails to draw interest. Barnes & Noble (NYSE:BKS) is having a hard time selling itself, sources said, and it has pulled back on its efforts to find a buyer. Though the bookseller has a successful e-reader to its name and rival Borders recently filed for bankruptcy, insiders say there is simply "no strategic (bidder) out there that would want them. They could appeal to private equity, but there's been no rabid interest so far." A Barnes & Noble spokeswoman declined to comment, other than to say the sale process is 'ongoing.' Shares slid as much as 6% yesterday before closing -3.4%.
- Boeing nabs new Dreamliner orders. In a boost for Boeing and its much-delayed Dreamliner program, two major Chinese airlines announced today that they would order several new jets. Air China (OTCPK:AIRYY), the nation's flagship carrier, announced orders for five 747-8 Intercontinentals, while Hong Kong Airlines ordered 38 planes, including 30 787-9 Dreamliners, two 787-8 VIP aircraft and six 777 Freighters. Boeing's Dreamliner program, now more than three years behind schedule, has orders for 843 planes from 56 customers, and Boeing plans to begin final upgrades on at least six of the aircraft in the coming days and weeks.
- Starbucks brings Via to China. Starbucks (NASDAQ:SBUX) is bringing Via, its instant single-serving coffee packets, to China, Hong Kong and Taiwan, as of April 6. Though Starbucks already has coffee stores in China, the launch marks Starbucks' entrance into the Chinese market as a consumer packaged-goods company. The launch is an acceleration of Starbucks' expansion strategy for consumer goods; as recently as November, CEO Howard Schultz said Chinese consumers needed more time to develop their taste for coffee and that he had no plans to introduce Via in China.
- Auto recalls from major players. Yesterday saw recalls from three major automakers, and while the size of each recall was relatively small, the announcements further erode consumer confidence in the quality of certain automakers' products. Honda (NYSE:HMC) recalled 35,000 vehicles to fix a problem with the electrical system, Toyota (NYSE:TM) recalled 22,000 vehicles to address faulty tire pressure monitoring systems, and Chrysler recalled around 20,000 vehicles over steering issues.
- SEC faces capacity gap. The SEC needs another 400 employees just to manage its current workload, according to a preliminary internal review led by Boston Consulting Group. The capacity gap means the SEC "will be unable to complete the requirements of Dodd-Frank while maintaining its current activities." SEC Chairman Mary Schapiro said last month that the agency needs a larger budget and 800 more workers to meet the demands of the financial reform law. The full report is due March 14.
Earnings: Monday After Close
- Urban Outfitters (URBN): Q4 EPS of $0.45 misses by $0.07. Revenue of $668M (+14% Y/Y) misses by $6M. Shares -11.9% AH. (PR, earnings call transcript)
- In Asia, Japan +0.2% to 10525. Hong Kong +1.7% to 23712. China +0.1% to 3001. India +1.2% to 18440.
- In Europe, at midday, London +0.0%. Paris +0.2%. Frankfurt +0.3%.
- Futures at 7:00: Dow +0.2%. S&P +0.3%. Nasdaq +0.1%. Crude -0.1% to $105.34. Gold flat at $1434.90.
Tuesday's Economic Calendar
7:30 NFIB Small Business Optimism Index
7:45 ICSC Retail Store Sales
8:55 Redbook Chain Store Sales
10:00 IBD/TIPP Economic Optimism
10:00 Nomination Hearing: Peter Diamond for Fed Board
1:00 PM Results of $32B, 3-Year Note Auction
- Notable earnings before Tuesday's open: DKS
- Notable earnings after Tuesday's close: FMCN FNSR, STP
The SA Currents team contributed to this post.
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