Wall Street Breakfast: Must-Know News

by: Wall Street Breakfast
Wall Street Breakfast
Seeking Alpha's flagship daily business news summary, gives you a rapid overview of the day's key financial news. It is published before 7:00 AM ET every market day and delivered to over 900,000 email subscribers.

Markets fall as China cuts GDP target. China has lowered its GDP target to 7.5% from the 8% goal that's been in place since 2005. Speaking at the annual meeting of the National People’s Congress, Premier Wen Jiabao added that the nation needs to shift to a more sustainable and efficient economic model, indicating China will cut its reliance on exports and capital spending in favor of increased consumption. The announcement sent global equity markets lower and came as figures showed that China's services PMI contracted in February.

India bans cotton exports. India, the world's number two producer of cotton, has banned all exports of the commodity, effective immediately. No explanation of the embargo was offered. Cotton futures jumped 4.5% to $0.92 a pound premarket.

BP could face $17.6B in fines after reaching deal with plaintiffs. BP (NYSE:BP) has agreed to an uncapped settlement with thousands of plaintiffs in the Deepwater Horizon oil spill trial, estimating its costs will come to $7.8B. The announcement came ahead of a delayed trial, which was set to begin today. The focus is now shifting to the criminal and civil fines BP faces, with the latter potentially reaching $17.6B.

Greek default looking increasingly likely. Greece is on course to default, as it looks set to fall short of the 95% agreement it needs from private creditors to secure its bond swap, The Daily Telegraph reports. Athens is ready to use collective action clauses ((NASDAQ:CAC)) to impose the deal if it receives 66% approval, which is likely to prompt ratings agencies and the ISDA to declare default.

Russian shares rise after Putin's victory. Russia's blue-chip Micex index was +0.7% midday in Europe after Vladimir Putin claimed an unsurprisingly overwhelming victory in the presidential election. While the opposition plans another mass rally in Moscow today and the poll drew charges of vote-rigging - Putin won a dictator-style 99.7% of the vote in Chechnya - the "market will now focus on whether Putin will deliver on his economic and political promises," says Renaissance economist Ivan Tchakarov.

North Korea may have tested nuclear bomb for Iran. Western intelligence agencies detected two nuclear weapons tests in North Korea during 2010, Welt Online reports, with one or both of them possibly being conducted for Iran. The news comes ahead of a crucial meeting between President Obama and Israeli Prime Minister Binyamin Netanyahu today, when the two will reportedly try to resolve their differences over where their "red line" should be.

Fed becoming more optimistic. Not only is further stimulus off the table, but the Fed is likely to emerge from next week's policy meeting with a slightly more upbeat view of the economy, The Wall Street Journal reports. The fast decline in unemployment has taken Fed officials by surprise, and it could mean more underlying strength in the economy than other data would indicate.

AIG to sell $6B of AIA shares. AIG (NYSE:AIG) is selling around $6B of AIA shares to help repay its government bailout. AIG will hold about 19% of AIA after the stock sale.

Credit Suisse to buy back $4.4B in securities. Credit Suisse (NYSE:CS) plans to repurchase up to 4B Swiss francs ($4.4B) in outstanding public tier 1 and tier 2 securities. The buyback is part of the bank's efforts to conform to the new Swiss and Basel III global capital adequacy rules.

AMD to take $703M charge on deal amendment. AMD (NYSE:AMD) has amended its wafer-supply agreement with Globalfoundries and will take a one-time charge of $703M in Q1. AMD's Q1 2012 non-GAAP gross margin guidance of around 45% and the 2012 non-GAAP gross margin guidance of 44%-48% remain unchanged.

Apple store passes 25B downloads. More than 25B apps have been downloaded from Apple's (NASDAQ:AAPL) store since it was first launched four years ago, the company said yesterday. Apple, which has paid out $4B to developers after taking its 30% cut, said last week that its app economy had created 210,000 U.S. jobs. Meanwhile, Senator Charles Schumer has asked the FTC to investigate claims that apps downloaded to Apple and Android (NASDAQ:GOOG) devices steal private contacts and photos, and post them online without consent.

Wells Fargo looks to expand overseas. While other banks consolidate their bases and exit international positions, Wells Fargo (NYSE:WFC) has drafted plans to expand its overseas operations and wants to move into 20 markets worldwide. Wells sees scope to grow significantly as mid-market U.S. companies eye expansion opportunities abroad, said Richard Yorke, the bank's global chief.

Glencore unlikely to strengthen Xstrata offer. Glencore (OTCPK:GLCNF) has said its $37B takeover of Xstrata (OTC:XSRAY) is "fair" for all shareholders at current levels, dashing hopes of a sweeter offer.

By Yigal Grayeff and the Market Currents team

Today's Markets:
In Asia, Japan -0.8% to 9699. Hong Kong -1.4% to 21265. China -0.6% to 2445. India -1.6% to 17363.
In Europe, at midday, London -0.5%. Paris -0.7%. Frankfurt -1.1%.
Futures at 7:00: Dow -0.4%. S&P -0.4%. Nasdaq -0.4%. Crude -0.45% to $106.22. Gold -0.6% to $1699.20.

Monday's economic calendar:
10:00 Factory Orders
10:00 ISM Non-Manufacturing Index
1:20 PM Fed's Fisher: 'The State of the Economy'

Notable earnings before Monday's open: AG, ARCO

Notable earnings after Monday's close: PAY

For full real-time earnings coverage, please click here.

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