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Spain unveils another €65B of austerity. Spanish PM Mariano Rajoy has announced an extra €65B of savings as part of an attempt to achieve his country's slightly relaxed deficit targets. The measures add to €45B of austerity that Rajoy has already pushed through, and include VAT rises, and local-government reforms. The fear is that the cuts will only add to Spain's recessionary vortex.

Profit warning pounds hhgregg shares. hhgregg (NYSE:HGG) was crushed 21% in post-market trading after the retailer cut its outlook for FY13 EPS to $0.90-$1.05 from prior guidance of $1.12-$1.27, and forecast that same-store sales will fall even more than it originally anticipated. hhgregg cited lower-than-expected sales in its video (i.e. TV) category for the warning. Best Buy (NYSE:BBY) fell 4.35% in sympathy.

Another futures broker collapses after client funds go missing. Farmers will again be hit after the collapse yesterday of Iowa-based futures broker PFGBest, which was forced to freeze client accounts following accusations that it misappropriated customer funds. The shortfall now exceeds $200M. "It's deja vu all over again," said John Roe, a co-founder of a group set up to help MF Global customers.

Top Stock News
Pfizer, GSK HIV drug outperforms in Phase III. Shionogi-ViiV Healthcare, a joint venture involving GlaxoSmithKline (NYSE:GSK), Pfizer (NYSE:PFE) and Shionogi, today said a Phase III trial of its dolutegravir HIV treatment suggests it might be more effective than Gilead's (NASDAQ:GILD) and Bristol-Myers Squibb's (NYSE:BMY) Atripla drug.

DirecTV cuts access to Viacom channels in dispute over fees. DirecTV's (NASDAQ:DTV) almost 20M subscribers last night lost access to 17 Viacom (NASDAQ:VIA) networks, including Nickelodeon, MTV and Comedy Central, after the satellite broadcaster dropped the channels because of a failure by the two companies to forge a new deal over carriage fees. The dispute follows a fight between Dish Network (NASDAQ:DISH) and AMC Networks (NASDAQ:AMCX) in June.

Chinese watchdog admits error over Mead baby formula. "Sorry, we made a mistake," a Chinese consumer watchdog said today - or words to that effect - for a test which showed that Mead Johnson's (NYSE:MJN) baby formulas contained banned additives. The report sent Mead's shares diving yesterday before they recovered somewhat to close -4.3%. What's Chinese for "class-action suit?"

Blackstone to leave the office. Looking to take advantage of a recovering market, Blackstone (NYSE:BX) is preparing to sell its portfolio of office buildings, the WSJ reports. The assets - with a value of as much as $22B - may also be packaged and listed as a REIT. A price of $20B would give Blackstone about an $8B profit on the properties.

Duke fired Johnson for being autocratic. Duke Energy (NYSE:DUK) sacked Bill Johnson after its merger with Progress Energy partly because of his autocratic leadership style, CEO Jim Rogers told a hearing of the North Carolina Utilities Commission yesterday. There were also concerns about Progress' nuclear assets and the utility's poor performance since the deal was announced 18 months ago.

JPMorgan sharpens its claws. JPMorgan (NYSE:JPM) is planning to claw back millions of dollars in stock from individuals connected with the CIO trading loss, the WSJ reports, including former CIO boss Ina Drew and "London whale" Bruno Iksil. The clawback could be announced as soon as Friday, when the bank reports earnings.

Barclays shareholders want external chairman. Three of Barclays' (NYSE:BCS) top 10 investors have said they want an outsider appointed as chairman, potentially undermining plans for deputy chairman Sir Michael Rake to succeed Marcus Agius.

Amazon tests smartphone. The Amazon (NASDAQ:AMZN) smartphone rumors heat up, with the WSJ reporting that the company is testing a device with a 4-5 inch screen with Asian component suppliers. Mass production may begin in late 2012.

Xstrata delays vote on Glencore merger. Xstrata (OTC:XSRAF) has set Sept. 7 as the new date for a shareholder vote on Glencore's (OTCPK:GLCNF) $26B takeover. It's a deadline of sorts for negotiations with Qatar, which is demanding improved deal terms. Xstrata's shareholders had been scheduled to meet tomorrow.

Top Economic & Other News
Californian cities dropping like flies. San Bernadino is set to become the third California city to file for bankruptcy protection in the last month after officials said it faced an imminent financial crisis. San Bernadino, which will join Stockton and Mammoth Lakes, hopes to restructure its finances while in Chapter 9, but a concerned municipal bond market may have other plans.

China could fall back on Keynesianism - again. Chinese Premier Wen Jiabao yesterday indicated that the government could increase spending to counter its slowing economy. "Growth-stabilizing policies," said Wen, "include boosting consumption and diversifying exports, but currently, what is important is to promote a reasonable growth in investment."

Report highlights social cost of crisis in eurozone. Around 3.5M jobs have been lost in the eurozone since the 2008 financial crisis, a report from the International Institute for Labour Studies shows, and a further 4.5M are at risk. If eurozone leaders fail to make job creation a priority, the region's 11% unemployment could rise sharply, "fueling social unrest and eroding citizen's confidence in national governments, the financial system and European institutions."

Editors' Picks
Angie's List And Merrill Lynch: Partying Together Like It's 1999
Going For Profits Off The 'Crack Spread'
Best Buy's Transformation - More Like Circuit City

Today's Markets:
In Asia, Japan -0.1%. Hong Kong +0.1%. China +0.5%. India -0.7%.
In Europe, at midday, London flat. Paris -0.2%. Frankfurt +0.5%.
Futures at 7:00: Dow +0.4%. S&P +0.4%. Nasdaq +0.35%. Crude +1.6% to $85.24. Gold flat at $1579.30.

Today's economic calendar:
7:00 MBA Mortgage Applications
8:30 International Trade
10:00 Wholesale Trade
10:30 EIA Petroleum Status
1:00 PM Results of $21B, 10-Year Note Auction
2:00 PM FOMC minutes

Notable earnings after today's close: MAR

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Source: Wall Street Breakfast: Must-Know News