Greece will miss deficit targets. The Greek cabinet approved the draft 2012 budget yesterday, and will present it to parliament today, but while the government agreed to an additional €6.6B ($8.8B) of austerity measures demanded by the troika, the country won't meet its deficit target this year. Greece's 2011 deficit is now expected to be 8.5% of GDP vs. its 7.6% target; for 2012, the deficit is set to fall to 6.8%, still above the 6.5% target. The news has sent Asian and European shares tumbling, though Greece says it's optimistic about the next tranche of aid.
NY Fed puts European banks in focus. The NY Fed may ask European lenders for more detailed reports on their liquidity positions, sources say, as the U.S. increases its monitoring of the European debt crisis. Regulators have already held informal talks with the banks, and the additional details could include information on forex and credit-default swaps.
ACI Worldwide buys S1. ACI Worldwide (NASDAQ:ACIW) will acquire online banking software developer S1 (NASDAQ:SONE) for a blended value consisting of $6.62 per share in cash and .1064 shares of ACI stock, meaning a cash payment of $360M, closing a deal in the works since July. The combined company "will be well positioned to address both emerging and developed payments markets," they say.
Alibaba lines up for Yahoo. Speaking to a U.S. audience late Friday, Alibaba (OTC:ALBCF) CEO Jack Ma said "we are very interested" in pursuing Yahoo (NASDAQ:YHOO) - the "whole" company - adding that Alibaba has held talks with other potential buyers about deal options. The possibility that Yahoo could fall under Chinese control raises some privacy concerns and could prompt an uproar among U.S. lawmakers and privacy watchdogs. YHOO +6.3% premarket (7:00 ET).
Kodak denies bankruptcy rumors. Eastman Kodak (EK) is +41% premarket (5:00 ET). The jump follows Kodak's statement that despite a recent draw-down from its credit line and rumors about restructuring, it has no intention of filing for bankruptcy: "It is not unusual for a company in transformation to explore all options and to engage a variety of outside advisers, including financial and legal advisers."
French bank worries won't go away. Shares of embattled Franco-Belgian lender Dexia (OTC:DXBGF) plunged as much as 12% following a Moody's report questioning its liquidity. Dexia has €3.4B exposure to Greece - the most of any European bank - although Moody's is more worried about its ability to borrow. Other French bank stocks aren't faring much better on worries about Greece missing its deficit targets. Recently, Credit Agricole (OTCPK:CRARY) was -5%; SocGen (OTCPK:SCGLY) -7%. BNP Paribas (OTCQX:BNPQY) -6%.
Eurozone mfg. contracts, again. Eurozone PMI came in at 48.5 vs. August's 49 and the flash estimate of 48.4 - a 25-month low and the 2nd consecutive month the reading is showing a contracting manufacturing sector. Only Germany's PMI held above the 50 mark.
Citigroup faces Japan probe. Japanese regulators are reportedly investigating Citigroup (NYSE:C) for possible violations in connection to the marketing of financial products. If found guilty, Citigroup would face its third major punishment in Japan in the last seven years, including the possible suspension of some operations for a given period of time.
Barclays, BofA may exit Archstone. Barclays (NYSE:BCS) and BofA (NYSE:BAC) are reportedly considering selling their stakes in apartment company Archstone. The two stakes total 53% of Archstone, and are worth a combined $2B-3B.
IMF sees more downside risk. Downside risks to the global economy have increased "as of late," said IMF Deputy Managing Director Zhu Min this morning, including the possibility that the U.S. economy could further weaken and that the eurozone debt crisis could spin out of policymakers' control. Countries need to begin "significant deficit reduction," some more urgently than others.
Q3 wrap. A volatile Q3 saw the S&P 500 drop 14%, and ended with investors worried that what once looked like a "soft patch" on the road to recovery is instead a harbinger of a global double dip. The result has been a flight to safety, though it hasn't been quite so clear what that entails, as even gold suffered some spectacular losses in Q3, falling 12% in the span of one week. Investors also turned to cash and government bonds, primarily in the U.S. and Germany, despite yields lower than the inflation rate.
Asia: Japan -1.8%. Hong Kong -4.4%. China closed. India -1.7%.
Europe at midday: London -2.1%. Paris -2.5%. Frankfurt -2.5%.
Futures at 7:00: S&P -0.21%. 10-yr +0.08%. Euro -0.16% vs. dollar. Crude -0.85% to $78.53. Gold +2.3% to $1659.55.
No notable earnings today.
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