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Michaels Stores draws up IPO plans. Michaels Stores, the largest arts-and-crafts retailer in North America, is reportedly intending to carry out an IPO. The listing would come six years after Michaels was taken private for over $6B by a consortium of P-E firms that included Blackstone Group (NYSE:BX) and Bain. Michaels has hired investment banks and plans to file a registration document in April.

U.K. in talks to sell third of RBS holding. The British government is in negotiations to sell up to a third of its 82% stake in RBS (NYSE:RBS) to Abu Dhabi, the BBC reports, although sources caution a deal isn't imminent. Based on RBS's market cap of $49.8B, the deal could be worth around $13.5B.

EU probes United Tech's $16.5B Goodrich purchase. The European Commission has opened an in-depth investigation into United Technologies' (NYSE:UTX) $16.5B acquisition of Goodrich (NYSE:GR) amid worries that the purchase could hurt competition for engine controls and AC power generators. United Tech remains publicly sanguine, saying it's confident it will close the deal by mid-year despite the EC extending the deadline for a decision until August.

1.87M jobs at risk as highways deadline looms. The GOP last night pulled a House vote on a 90-day extension of funding for U.S. highways and transit projects, which expires on Saturday, after it became clear it wouldn't pass. Democrats want the House to vote on a 2-year, $109B Senate measure that was approved this month. Failure to extend the funding could affect up to 1.87M jobs.

News Corp. hacking may have extended to NDS. News Corp. (NASDAQ:NWS) might have another hacking scandal on its hands: a BBC program alleges that set-top software firm NDS, which is 49%-owned by News Corp. and is due to be acquired by Cisco (NASDAQ:CSCO), cracked the smart card codes of ONdigital, a one-time rival to News Corp.-affiliated BSkyB (BSYBY.PK). NDS then gave the codes to pirates, who used them to make thousands of counterfeit smart cards, with the subsequent illegal viewing contributing to ONdigital's bankruptcy.

Rio Tinto mulls sale of $2.6B diamond ops. Rio Tinto (NYSE:RIO) is considering selling its diamond assets because the mines may no longer fit its strategy. The unit could be worth nearly $2.6B.

Enbridge, Enterprise plan U.S.-Canada pipelines. Enbridge (NYSE:ENB) and Enterprise Products Partners (NYSE:EPD) are planning to build new pipelines that will transport up to 850K barrels of crude oil a day from Canada to refineries along the Gulf Coast by mid-2014. The pipelines will compete with TransCanada's (NYSE:TRP) troubled Keystone project, if it ever gets approved.

AIG predicts $5B-$10B profit for taxpayer from bailout. The taxpayer could end up making a profit of $5B-$10B once AIG (NYSE:AIG) repays the estimated $45B it still owes the government for its bailout, CEO Bob Benmosche told Jim Cramer yesterday. In March alone, the Treasury has gained back over $14.6B of its investment in AIG, including $6B from the sale of shares.

EPA to seek CO2 limits on new power stations. The EPA will propose, possibly today, the first ever standards for limiting CO2 emissions from new electricity plants, Reuters reports. The rules are likely to be politically divisive and could hurt companies that generate most of their power from coal, such as Southern Co (NYSE:SO) and American Electric Power (NYSE:AEP).

Symantec ends Huawei JV over U.S. fears. Symantec (NASDAQ:SYMC) is expected to complete the dissolution of its joint venture with Huawei Technologies in the next two weeks. The New York Times reports that Symantec is concerned that the JV would prevent it from gaining access to classified U.S. government information about cyber-threats.

Hirai to retain control of Sony's TV ops. Incoming Sony (NYSE:SNE) CEO Kazuo Hirai is to maintain direct charge of the company's ailing TV division, indicating the priority he's placing on turning it around. Hirai has already pulled off such a trick with Sony's PlayStation business.

Apple under attack Down Under over 4G claims. Australia's consumer watchdog says Apple (NASDAQ:AAPL) made misleading claims about 4G capability when promoting its new iPad in the country. Regulators plan to apply to the Federal Court in Melbourne tomorrow on the allegation that Apple breached consumer law.

Today's Markets:
In Asia, Japan +2.4% to 10255. Hong Kong +1.8% to 21047. China -0.1% to 2347. India +1.2% to 17257.
In Europe, at midday, London +0.1%. Paris +0.2%. Frankfurt +0.7%.
Futures at 7:00: Dow flat. S&P +0.05%. Nasdaq +0.1%. Crude +0.2% to $107.26. Gold +0.5% to $1693.40.

Tuesday's economic calendar:
7:45 ICSC Retail Store Sales
8:55 Redbook Chain Store Sales
9:00 S&P Case-Shiller Home Price Index
10:00 Consumer Confidence
10:00 State Street Investor Confidence Index
10:00 Richmond Fed Mfg.
10:00 Budget Hearing (Geithner)
10:00 Hearing: Fed's aid to Eurozone (Dudley)
12:35 PM Fed’s Rosengren: Economic Outlook
12:45 PM Bernanke: 'The Federal Reserve and the Financial Crisis'
3:45 PM Fed’s Duke: 'Building Sustainable Communities'

Earnings Results: Companies that beat EPS expectations last night and today include Apollo Group (NASDAQ:APOL), Lennar (NYSE:LEN). Notable earnings before Tuesday's open: LEN, MKC, WAG. Notable earnings after Tuesday's close: PVH. For full real-time earnings coverage, click here.

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Source: Wall Street Breakfast: Must-Know News