ECB likely to dash hopes of bond-buying. Today marks the beginning of another crucial few days for the EU, starting with an ECB policy decision in which it's expected to cut rates to a record low of 1% from 1.25% and unveil a new package of bank aid. The European Banking Authority will then say how much banks will need to raise to absorb losses from eurozone bonds, while the latest do or die EU summit will start in the evening. Markets have "febrile expectations" that the ECB will launch a money-printing bond-buying bazooka, but it's unlikely to happen. If that's the case, there could be more carnage.
Corzine faces House grilling. After staying silent amid all the furor surrounding MF Global's (OTC:MFGLQ) collapse, Jon Corzine is appearing today at a House committee hearing to speak about his role in the fiasco. He has written a prepared statement (.pdf) in which he apologizes for the firm's failure but it's otherwise unclear at the time of writing whether he will answer questions or invoke the Fifth Amendment.
Central banks prepare for the end of the euro. While eurozone chief Jean-Claude Juncker today said the euro "is in no way at risk," some European central banks have reportedly started to weigh their options for a partial, or complete, eurozone breakdown. Ireland, for example, is said to be considering whether it needs to stock up on printing presses in case it must print new notes, while the Swiss are considering alternate currencies to use as a franc reference point.
BOE holds steady. As expected, the Bank of England is taking a wait-and-see approach, maintaining its benchmark rate at 0.5% and keeping its asset purchase program at £275B.
Costco CEO Sinegal signs off with profit rise. Costco's (NASDAQ:COST) FQ1 EPS rose to $0.73 from $0.71 as revenue increased 12.5% to $21.18B but the company missed expectations, with an increase in membership fees and strong gasoline prices offset by one-time charges. Founder and CEO Jim Sinegal is in his last month of leading Costco before he will be replaced by COO Craig Jelinek in January.
SEC lets large investors stay in stealth mode. Fifty investors have this year used SEC rules to conceal their stakes in certain companies as they look to avoid "substantial harm" to their competitive positions. In addition to Warren Buffett when he bought IBM (NYSE:IBM) shares, Ralph Whitworth used special disclosure exemptions for big investors to cloak his purchases of H-P (NYSE:HPQ) stock, with Carl Icahn, Nelson Peltz and Deutsche Bank (NYSE:DB) hiding investments as well.
Panel cancels insider vote. A House committee last night canceled a vote on measures to ban Congressmen from insider trading just a day after scheduling it. The GOP's Spencer Bachus said the reason for the move was a bi-partisan desire for more time to study the issue.
Boeing workers approve contract deal. Boeing (NYSE:BA) machinists last night ratified a landmark four-year contract extension following weeks of talks. The agreement is likely to lead to the dismissal of a high-profile complaint filed by labor against Boeing in April.
Power of ratings agencies on the wane? The biggest U.S. banks will have to end their reliance on ratings agencies to assess the risk of their assets under proposed rules aimed at weakening the influence of the agencies. Some analysts reckon the regulations could reduce the demand for the services of S&P (MHP), Moody's (NYSE:MCO) and Fitch (OTC:FMLCF), although their power might already be on the wane given the little market reaction to S&P's EU warnings this week, including yesterday.
Exxon: Natural gas to replace coal as top power fuel. Exxon's (NYSE:XOM) closely-watched outlook report is due out later today. Among the predictions: By 2025, natural gas will replace coal as the leading fuel for generating electricity in the U.S., and will be the world's No. 2 fuel source overall, while global energy demand will grow 30% by 2040.
GOP likely to block appointment of financial consumer chief. The Senate is due to vote today on who will be the first director of the Consumer Financial Protection Bureau, but don't expect an answer anytime soon. Republicans say they have the votes to block the Democrat's choice of former Ohio AG Richard Cordray. The problem, says the GOP, isn't Cordray himself but how the bureau is designed, and gridlock is likely until changes are made.
Chevron to invest $33B on capital and exploration next year. Chevron (NYSE:CVX) yesterday unveiled a $32.7B capital and exploratory spending program for 2012, roughly the same amount as this year. Gas is the focus, with U.S. projects in the Gulf and Marcellus Shale, and the continuation of a multi-year LNG facility in Australia.
Alibaba searches for treasure trove. Alibaba (OTC:ALBIY) is reportedly looking for up to $4B in debt financing for a deal to buy back the 40% of the company owned by Yahoo (NASDAQ:YHOO). Analysts say Yahoo's stake is worth at least $9B.
Centenarian chairman to retire. Sir Run Run Shaw, the Chairman of Television Broadcasts (OTCPK:TVBCF) and producer of Blade Runner, is to retire after over 40 years at Hong Kong’s biggest television company. He is a mere 104 years old.
In Asia, Japan -0.7% to 8665. Hong Kong -0.7% to 19108. China -0.1% to 2330. India flat at 16488.
In Europe, at midday, London +0.4%. Paris -0.1%. Frankfurt +0.2%.
Futures at 7:00: Dow flat. S&P -0.1%. Nasdaq +0.1%. Crude +0.4% to $100.92. Gold -0.1% to $1743.50.
Thursday's economic calendar:
7:00 BOE Rate Decision
7:45 ECB Rate Decision
8:30 Initial Jobless Claims
10:00 Wholesale Trade
10:30 EIA Natural Gas Inventory
12:00 PM Quarterly Flow of Funds Report
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Earnings Results: Companies that beat EPS expectations last night and today include G-III Apparel (GIII), Pacific Sunwear (PSUN).
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