By Yigal Grayeff and the Market Currents team
Blackstone closes in on $16B fund. Blackstone (NYSE:BX) will finish raising over $16B for a new fund this month, Reuters reports, making it the 6th-largest private equity fund ever. Blackstone's success will come despite P-E capital raising falling slightly to $263B in 2011, showing that investors are becoming more choosy about where they put their money.
Kodak faces Chapter 11. Eastman Kodak (EK) plans to file for bankruptcy protection if efforts in the next few weeks to sell a horde of digital patents fall flat, The Wall Street Journal reports. Sources say a February filing could involve a $1B debtor-in-possession financing arrangement to keep the firm afloat.
PepsiCo mulls slashing 4,000 jobs. PepsiCo (NYSE:PEP) is reportedly considering cutting around 4,000 jobs, or 1% of its workforce, in order to boost its earnings. The company may also reduce its pension contributions, which it views as more generous than its peers.
RBS may cut 10,000 jobs. RBS (NYSE:RBS) CEO Stephen Hester is considering slashing 10,000 jobs and implementing a £1B-£2B restructuring plan as the lender retreats from investment banking. The bank will probably focus the cuts on its equity business, where it has never competed well against industry leaders. Once complete, the moves will return RBS to what it once was - a retail and corporate finance bank.
Two finalists vie for RBS's $7.5B air-leasing unit. RBS is also selling its aircraft-leasing unit in an auction that could attract up to $7.5B, Reuters reports, with the finalists being China Development Bank and Japan's Sumitomo Mitsui (NYSE:SMFG). Wells Fargo (NYSE:WFC) and a Macquarie (OTCPK:MQBKY) led group have dropped out; RBS could disclose the winner next week.
Seagate surges on revenue guidance. Seagate (NASDAQ:STX) jumped 7.4% in post-market trading after it forecast FQ2 revenue of $3.1B-$3.2B and FQ3 revenue of $4.2B-$4.5B, well above consensus estimates. Gross margins are also predicted to surge. Seagate was expected to profit handsomely from its minimal exposure to the hard-drive industry disruptions caused by the Thai flooding; now we know by how much.
Spain wants banks to set aside €50B. Moving away from a "bad bank" plan that was floated a few weeks ago, Spain is going to require its banks to set aside €50B of their own money as a provision against ailing property assets. Economy Minister (and former Lehmanite) Luis de Guindos said the issue is "manageable" and nowhere near the magnitude of Irish lenders, whose difficulties sunk their country's national budget.
Nokia eyes new chairman. Nokia (NYSE:NOK) may nominate board member Risto Siilasmaa to succeed Jorma Ollila as chairman, Finnish newspaper Helsingin Sanomat reports. The nomination committee is expected to recommend a candidate later this month. Shares were +2.2% premarket following an upgrade from Credit Suisse.
JAL looks to raise $13B in IPO. Japan Airlines (JAL) plans to raise up to ¥1T ($13B) this year in what would be the world's biggest IPO since GM's listing in 2010, Bloomberg reports. JAL, which exited bankruptcy last year, expects to make a profit this FY after cutting staff, planes and loss-making routes.
China weakens the yuan. China unexpectedly set the yuan weaker against the dollar this morning, temporarily dragging down currencies in the region. The dollar/yuan central parity was set at 6.3115, significantly above yesterday's all-time low of 6.3001. The move reverses the central bank's policy last year of allowing the renminbi to strengthen and could further agitate the U.S.
China's trade surplus declined in 2011. China's 2011 trade surplus fell to $160B from $183.1B in 2010, with the figure as a share of GDP dropping to around 2% from 3.1%. That should please the U.S., which has been urging China to keep the ratio below 4%. Separately, China's services PMI held steady at 52.5 in December, capping off the seventh consecutive year of expansion for the sector.
Seed shortage could hit corn planting. A shortage of corn seed, production of which may have fallen 25%-50%, could hamper the 2012 planting season and bring a second year of volatility to corn prices. However, Monsanto (NYSE:MON), DuPont (NYSE:DD) unit Pioneer Hi-Bred and other large seed companies remain sanguine about supplies.
In Asia, Japan -0.8% to 8489. Hong Kong +0.5% to 18813. China -1.0% to 2148. India -0.2% to 15857.
In Europe, at midday, London -0.6%. Paris -0.9%. Frankfurt -0.9%.
Futures at 7:00: Dow -0.6%. S&P -0.7%. Nasdaq -0.6%. Crude -0.8% to $102.36. Gold -0.1% to $1610.40.
Thursday's economic calendar:
Chain Store Sales
7:30 Challenger Job-Cut Report
8:15 ADP Jobs Report
8:30 Initial Jobless Claims
10:00 ISM Non-Manufacturing Index
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Earnings Results: Companies that beat EPS expectations last night and today include Mosaic (NYSE:MOS).
Those that missed forecasts include Texas Industries (NYSE:TXI).
For full real-time earnings coverage, please click here.