Wall Street urged Fed to act on eurozone. Wall Street executives recommended to Fed officials at a private meeting in September that central banks should make a joint effort to address the eurozone debt crisis. The suggestions included boosting the global economy by buying securities, a move that may yet happen as many investors believe yesterday's swap announcement was a prelude to additional action. Coordinated lending to European banks wasn't among their proposals.
Zynga targets $10B market cap in IPO. Internet games company Zynga plans to raise $900M in its IPO by offering its shares at $8-$10 each, which would give it a market cap of up to $10B, Bloomberg reports. That would represent as much as 9.8X the firm's trailing 12-month sales vs. around 3X for peer Activision (NASDAQ:ATVI) and 2X for Electronic Arts (ERTS). Zynga intends to sell a maximum of 10% of its outstanding shares, which are due to be priced on December 15.
Spain, France bond sales avoid disaster. Spain and France held decent bond auctions today, with the latter's borrowing costs slipping in a sale of 10-year notes. Spain sold €3.75B of bonds, the top end of its range, with demand rising to 2.69 times the amount sold. However, the average yield rose to 5.544%, the highest in at least six years and up from 4.848% on similar notes auctioned at the beginning of November.
AT&T, Deutsche Telekom explore JV to pool assets. In a sign that AT&T (NYSE:T) may be giving up hope on a fully-fledged merger with T-Mobile, The Wall Street Journal reports that Ma Bell has held preliminary talks with T-Mobile parent Deutsche Telekom (OTCQX:DTEGY) about forming a JV to pool their network assets. Such a deal could lower AT&T's operating costs and improve its spectrum, but wouldn't provide the retail benefits of a merger.
Borrowing by small firms continues to rise. The Thomson Reuters/PayNet Small Business Lending Index rose 20% to 98.1 in October, up from 12% growth in September and the 15th monthly double-digit increase. Delinquencies fell to a record low. With changes in the index tending to precede those for the broader economy by 2-5 months, the trend points to an improvement in the wider picture.
China, eurozone factory activity contracts. China's official PMI dropped to 49 in November from 50.4 in October, indicating that activity at its big manufacturers fell for the first time in nearly three years. The picture in the eurozone was even more gloomy, where PMI sank to 46.4 from 47.1, contracting at the sharpest pace in 28 months. Not a single country came in above 50, "highlighting the broadening-out of the downturn from the periphery to the core."
Watchdog: SEC failed to pursue probe of massive fraud. In its semi-annual report to Congress, the SEC's watchdog detailed an anonymous tip explaining how agency staffers discovered a "massive fraud" by a hedge fund manager and never pursued it. The complaint also alleges that the SEC's examination staff pointed out that the person in question "was listed as one of the top 25 people responsible for the 2008 financial crisis by Time magazine."
Blackstone, Alibaba, others eye joint Yahoo bid. Blackstone (NYSE:BX), Bain Capital, Softbank (OTCPK:SFTBF) and Alibaba (OTC:ALBCF) are in talks about making a bid for all of Yahoo (NASDAQ:YHOO), Bloomberg reports, and would value the portal at more than other offers. Yahoo’s board reportedly met yesterday to discuss proposals for a minority stake from bidders including Silver Lake and TPG Capital.
Sasol mulls $4.5B chemical plant in Louisiana. Sasol (NYSE:SSL) could invest up to $4.5B to build a factory that would use low-cost natural gas to make ethylene and related chemicals in Louisiana. The South African company, which aims to complete a feasibility study by June 2013, joins Dow Chemical (NYSE:DOW), Shell (NYSE:RDS.A) and others in studying whether to build ethane crackers in the U.S.
Japan formulating yet another extra budget. In a step unprecedented since postwar reconstruction, Japan is putting together a fourth additional budget, which will probably amount to at least ¥2T ($26B). However, the government doesn't intend to issue extra bonds. Japan has already allocated ¥18T in three packages this year in an attempt to solidify its recovery from the March earthquake in the face of the strong yen, the eurozone crisis and the Thai floods.
Feds set to file more insider-trading charges. Federal authorities are poised to file insider-trading charges against individuals who have worked at three prominent investment firms - Neuberger Berman, Diamondback Capital Management, and Level Global Investors - all of which have managed billions of assets, reports say. If brought, the charges would represent a notable widening of a probe into how public company employees pass along confidential information.
In Asia, Japan +1.9% to 8597. Hong Kong +5.6% to 19002. China +2.3% to 2387. India +2.2% to 16483.
In Europe, at midday, London +0.4%. Paris -0.5%. Frankfurt -0.5%.
Futures at 7:00: Dow -0.1%. S&P -0.3%. Nasdaq flat. Crude -0.3% to $100.06. Gold flat at $1749.90.
Thursday's economic calendar:
Chain Store Sales
8:30 Initial Jobless Claims
10:00 ISM Manufacturing Index
10:00 Construction Spending
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 Aeropostale (NYSE:ARO), Finisar (NASDAQ:FNSR), La-Z-Boy (NYSE:LZB).
Those that missed forecasts include Guess? (NYSE:GES).
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