EU group agrees on fiscal pact without U.K. EU stocks and U.S. futures were higher premarket after 23 EU nations agreed to tighten their fiscal coordination, with EU countries also agreeing that central banks would loan the IMF €200B ($267B) to lend to distressed members. However, the U.K. wielded its veto to prevent a new treaty after not receiving protection for its financial sector, and warned that the new bloc would not be able to use EU resources. This raises doubts about whether the eurozone will be able to enforce its new fiscal rules.
TI, Altera shares slump following warnings. Texas Instruments (NYSE:TXN) was -6.4% premarket and Altera (NASDAQ:ALTR) fell 6.1% post-market last night after issuing earnings warnings. TI cut its guidance for EPS to $0.21-$0.25 and for revenue to $3.19B-$3.33B, blaming "lower demand across a wide range of markets," save for wireless application processors. Altera said Q4 revenue will dive a quarterly 13%-16% - worse than a prior forecast of a 7%-11% drop - due to macroeconomic issues and weaker-than-expected customer sales.
Toyota issues profit warning as well. Toyota (NYSE:TM) has sharply downgraded its earnings outlook for the fiscal year ending in March, due to a strong yen and the recent flooding in Thailand. The company now expects a net profit of ¥180B ($2.3B) vs. August's projection of ¥390B, revenue of ¥18.2T vs. ¥19T, and sales of 7.38M vehicles vs. 7.6M. Shares -1.9% premarket.
Wal-Mart probes employees for bribery. Wal-Mart (NYSE:WMT) has begun an internal investigation into whether some of its workers violated the Foreign Corrupt Practices Act, and has disclosed the matter to the Justice Department. Wal-Mart said it "cannot reasonably estimate the potential liability, if any, related to these matters," but it doesn't expect a "material adverse effect."
Moody's downgrades three French banks. Moody's has cut the long-term ratings of BNP Paribas (OTCQX:BNPQY), Credit Agricole (OTCPK:CRARY) and SocGen (OTCPK:SCGLY), citing the impact of funding constraints and deteriorating macroeconomic fundamentals on the French banks.
Japan seeks to penalize Citi and UBS. Japanese regulators are looking to impose penalties on Citigroup (NYSE:C) and UBS (NYSE:UBS) after their employees allegedly attempted to manipulate the Tokyo interbank offered rate.
Trade deficit widened in October, economists estimate. U.S. October trade figures are due out this morning, with economists expecting that the deficit widened to $44B from September's $43.1B, helped by increased consumer spending. Longer term, though, Bank of America economist Neil Dutta reckons that "the story is still one of rising exports and an ongoing narrowing of the trade gap."
Chinese data points to further cooling. Chinese inflation slowed more than expected to 4.2% in November from 5.5% previously, while its industrial output growth fell to 12.4% from 13.2%. The numbers potentially open the door for further stimulus by Beijing.
Household wealth falls the most since 2008. Americans got poorer in Q3 2011 as the net worth of households and non-profit groups fell by $2.4T to $57.4T, representing the sharpest drop since after Lehman's bankruptcy in September 2008. The latest decline was due to the falling values of stocks, pension funds and homes.
Lloyds CEO has to reapply for his job. Lloyds (NYSE:LYG) CEO Antonio Horta-Osorio, who is on medical leave for stress, is going through such a thorough vetting process that he is effectively having to reapply for his job, The Financial Times reports. The board, which is due to meet next Thursday, is undecided amid shareholder concern about Horta-Osorio's ability to return to work.
Zynga IPO demand looking good. Zynga (NASDAQ:ZNGA) has received enough orders to cover the 100M shares it's selling in its IPO, Bloomberg reports. IPO advisor Lise Buyer said that while Zynga is "off to a promising start," it's too early to draw conclusions. "An indication in the book is not a commitment. If the eurozone falls apart on the 9th, all bets are off."
Spotify takes on Panda. Spotify has unveiled a radio service that will offer "unlimited stations" and "unlimited skips." Until now, Spotify has largely operated in the market where users own the songs they listen to, but this latest move brings Spotify into head-to-head competition with Pandora (NYSE:P).
Samsung beats Apple in Australia round. Samsung (OTC:SSNLF) has won the latest Australian round of its global patent battle with Apple (NASDAQ:AAPL) after the country's High Court lifted a ban on selling the Galaxy tablet, with the decision coming just in time for Christmas. However, a French court yesterday rejected Samsung's bid to block sales of the iPhone 4S in France.
In Asia, Japan -1.5% to 8536. Hong Kong -2.7% to 18586. China -0.6% to 2315. India -1.7% to 16213.
In Europe, at midday, London +0.8%. Paris +1.9%. Frankfurt +1.6%.
Futures at 7:00: Dow +0.8%. S&P +0.8%. Nasdaq +0.75%. Crude +0.6% to $98.93. Gold +0.7% to $1726.00.
Friday's economic calendar:
8:30 Trade Balance
9:55 Reuters/UofM Consumer Sentiment
Earnings Results: Companies that beat EPS expectations last night and today include Esterline (NYSE:ESL), Cooper Companies (NYSE:COO).
Those in line include Smith & Wesson (NASDAQ:SWHC).
Those that missed forecasts include Pall (NYSE:PLL).
For full real-time earnings coverage, please click here.
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