By Yigal Grayeff and the Market Currents team
Fitch threatens Italy but reassures France. Fitch has warned that it could downgrade a number of eurozone countries, including Italy, by one or two notches by the end of the month. The agency called Italy the greatest risk to the euro amid the sovereign-debt crisis. However, Fitch said it won't cut France's AAA credit rating during 2012 unless there's a major economic shock.
Alcoa swings to net loss. Alcoa (AA) got the Q4 earnings season off to a disappointing start, missing expectations with an adjusted EPS loss of $0.03 vs. a profit of $0.24 last year despite revenue rising to $6B from $5.65B. Nonetheless shares were +1.9% premarket. The company, a bellwether for the economy, suffered from falling aluminum prices, and higher energy and transport costs. Looking ahead, CEO Klaus Kleinfeld predicted that production cutbacks would lead to an aluminum supply shortage, while demand would increase 7%.
BBVA may take €1B hit on U.S. unit. Spain's BBVA (BBVA) may need to take a goodwill adjustment for its U.S. unit, with a possible negative impact of €1B, because of the deteriorating macroeconomic outlook and the new regulatory framework.
Siemens warns on results. Siemens (SI) has called its full-year guidance "very ambitious" and warned it may miss its earnings target as global weakness throttles investment by its customers. Siemens expects industrial demand to remain slow in H1 2012 but sees a significant rebound starting in H2. Shares were -1.7% premarket.
Philips also warns on earnings. Philips (PHG) said it will take a Q4 charge because of weak European markets, particularly at its lighting division, and warned that its healthcare unit will report lower sales growth due to delays in delivering orders. The company is due to report results on January 30.
And Q4 guidance sends Juniper lower. Juniper (JNPR) dropped 3.6% in post-market trading after warning it expects Q4 revenue of $1.1B-$1.2B and EPS of $0.26-$0.28, largely below consensus of $1.19B and $0.34 respectively. In what appears to be a vindication of negative comments made last month by UBS, Juniper blamed the shortfall on weak service provider demand, particularly in the U.S.
Geithner set for fruitless trip to China. Timothy Geithner arrives in Beijing today as part of a trip to Asia, and not only are his hosts unlikely to heed any calls for faster yuan appreciation, they also aren't expected to be too enthusiastic about any plea to cut back on Iranian oil. "China will be less OK with it than Japan," said Near East Policy's Matthew Levitt, "But neither wants to be seen as rogue."
China's imports slow. China's import growth fell to a two-year low in December with an annual rise of 11.8%. Exports increased 13.4%, causing the trade surplus to widen to $16.5B.
DOJ seeks to extend mortgage deal with banks. The Justice Department is reportedly reaching out to various banks to gauge their interest in joining a wide-ranging mortgage settlement that is in the works with five major servicers. The banks probably include HSBC (HBC), PNC (PNC), MetLife (MET), SunTrust (STI) and U.S. Bancorp (USB).
MF Global Treasurer seeks protection. MF Global (OTC:MFGLQ) Treasurer Edith O’Brien, who is central to the search for the missing client money, is reportedly refusing to meet with investigators and has asked first for immunity from prosecution. O’Brien has often testified as an expert at the CFTC; her specialty: the protection of customer money at futures firms.
Wither CES? The CES officially kicks off today, although Farhad Manjoo argues on Slate that for all the breathless headlines, the year's marquee consumer electronics show now turns up few product launches worthy of excitement. Major announcements from Apple (AAPL), Amazon (AMZN) and others happen elsewhere, and reporters are left to talk up "bogus trends" involving products consumers aren't crazy about. Still, Nokia (NOK) last night introduced its new flagship device, the Lumia 900 smartphone. See Market Currents here for more news.
Tim Cook in the money. While Steve Jobs' total compensation in 2011 was a mere $1, that for CEO Tim Cook was $378M. Most of Cook's compensation was made up of restricted Apple (AAPL) stock that vests over the next ten years.
In Asia, Japan +0.4% to 8422. Hong Kong +0.7% to 19004. China +2.7% to 2286. India +2.2% to 16165.
In Europe, at midday, London +1.1%. Paris +2.3%. Frankfurt +2.4%.
Futures at 7:00: Dow +0.8%. S&P +0.9%. Nasdaq +0.85%. Crude +1.5% to $102.86. Gold +1.6% to $1633.30.
Tuesday's economic calendar:
7:30 NFIB Small Business Optimism Index
7:45 ICSC Retail Store Sales
8:55 Redbook Chain Store Sales
10:00 Wholesale Trade
1:00 PM Results of $32B, 3-Year Note Auction
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