Markets rally as Greek government totters. Stocks and the euro made gains premarket after Bloomberg reported an official from Greece's ruling PASOK party as saying that Prime Minister George Papandreou may withdraw his referendum proposal. More defections by PASOK MPs have left Papandreou's party without a majority in Parliament, and his leadership of the government teetering. Many scenarios are possible, but one sees Papandreou losing a confidence vote on Friday, meaning the euro-referendum is off and elections for a new government are on.
GSK to pay $3B to settle U.S. probes. GlaxoSmithKline (NYSE:GSK) has agreed to pay $3B, for which it has already set aside provisions, to settle civil and criminal claims by the U.S. government. The claims focus on GSK's sales and marketing practices, the Medicaid Rebate Program, and the development and marketing of diabetes drug Avandia. GSK hopes to complete the agreement with the U.S. in 2012. Despite the scale of the payment, GSK shares were just -0.2% premarket, with Helvea analysts saying the news reduces uncertainty about the company's liabilities.
30 companies avoided income tax in 2008-2010. GE (NYSE:GE), El Paso (EP) and Honeywell (NYSE:HON) are among 30 large and profitable U.S. corporations that paid no income taxes in 2008-2010, a study shows. The report, from the advocacy group Citizens for Tax Justice and the Institute on Taxation & Economic Policy, examined 280 Fortune 500 companies, and found that very few paid the statutory corporate income tax rate of 35%, with the average being 18.5%.
MF faces $633M customer shortfall. Despite telling a judge it can account for all its clients' cash, MF Global (MF) faces a shortfall of $633M in customer funds, futures exchange operator CME Group has estimated. CME said MF avoided detection because it transferred the funds from segregated customer accounts after a CME audit last week. Reuters reports that regulators still don't know where the money is and why they can't find it. Authorities began to raise concerns about MF's European sovereign debt exposure, which led to its collapse, as early as June. As for the wider impact, Ben Bernanke said it is limited.
Groupon may raise IPO price. Groupon is due to price its IPO today, when it could sell shares at $1-$2 above the $16-$18 range it originally planned after receiving strong demand. At $20 a share, the daily discount company would be valued at $12.7B. Books closed yesterday and trading is set to begin tomorrow. With Groupon to sell just 4.7% of its stock, one wit asks on Twitter, "if a company comes public with less than 5% of its shares in the float, is it even a public company?"
Judge OKs Sprint's lawsuit vs. AT&T/T-Mobile deal. A judge yesterday authorized Sprint (NYSE:S) to go ahead with a part of its lawsuit to block AT&T's (NYSE:T) $39B purchase of T-Mobile USA (OTCQX:DTEGY), allowing the claim that the deal would make it harder for smaller carriers to obtain in-demand devices such as smartphones. Sprint will now gain access to confidential AT&T legal filings. However, the judge dismissed all of Sprint's other claims, including its assertions that AT&T and Verizon Wireless (NYSE:VZ) would be able to increase Sprint's expenses for roaming and infrastructure services.
Fed holds off on further action. The FOMC is considering ways it could give clearer policy guidance and buying more mortgage debt to spur growth, Ben Bernanke said yesterday. However, it still voted 9-1 to hold a steady policy course. With the Fed downgrading its growth forecasts - it expects GDP to rise by just 1.6%-1.7% this year - and raising its unemployment projections, the lone dissenter was Charles Evans, who wants more easing. That's a "huge change," said strategic investor Dennis Gartman, as until now the dissenters have been hawks. "If you thought QE3 was on the table, it’s not," Gartman declared.
Apple admits software bug hits iPhone battery life. Apple (NASDAQ:AAPL) has confirmed to All Things Digital that some customers are experiencing poor battery life with their iPhones due to iOS5 bugs. "We will release a software update to address those (bugs) in a few weeks," Apple said.
Russia on track to join WTO. Russia has cleared a major hurdle on its way to join the WTO by agreeing an important trade deal with Georgia. If Russia gains acceptance into the organization, it will mark a significant milestone as economists estimate the move will add 3% to its economy in the medium-term and 11% in the long-term.
In Asia, Japan -2.2% to 8640. Hong Kong -2.5% to 19243. China +0.2% to 2508. India +0.1% to 17482.
In Europe, at midday, London -0.1%. Paris +0.8%. Frankfurt +1.1%.
Futures at 7:00: Dow +0.2%. S&P +0.1%. Nasdaq -0.2%. Crude +0.2% to $92.67. Gold +0.3% to $1734.60.
Thursday's economic calendar:
Chain Store Sales
8:30 Initial Jobless Claims
8:30 Productivity and Costs
10:00 ISM Non-Manufacturing Index
10:00 Factory Orders
10:30 EIA Natural Gas Inventory
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Earnings Results: Companies that beat EPS expectations last night and today include Avis Budget Group (CAR), Kraft (KFT), Lincoln National (LNC), News Corp. (NWS), Qualcomm (QCOM), Murphy Oil (MUR), Tesla Motors (TSLA), Whole Foods Market (WFM).
Those in line include CenturyTel (CTL).
Notable earnings before Thursday's open: AGU, ANF, ANR, APA, ARIA, BEAM, CNQ, CVS, DNR, DTV, DUK, EGO, EL, FIG, FTR, HCN, K, LAMR, LXP, MFA, MFC, MGA, MGM, MT, NNN, NRG, NYX, PCG, PGN, PNM, PPL, REGN, RGLD, SE, SLE, SNI, SPR, SRE, SU, TDC, TEL, TS, VRX, WNR, XEC
Notable earnings after Thursday's close: AIG, BKD, CBS, CHK, CIM, DVA, FLR, GNW, GXP, HANS, HME, ITMN, KFN, LYV, MCHP, MDRX, NGD, PKI, PSA, SAPE, SBUX, SGEN, SUN, SWKS, TIE, VNO, VSEA, WR, WRC
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