United Tech to sell pump unit for $3.46B. United Technologies (NYSE:UTX) has agreed to sell its Hamilton Sundstrand industrial products businesses to BC Partners and The Carlyle Group (NASDAQ:CG) for $3.46B. United Tech put the pump unit on the block, along with three other non-core assets, as part of a plan to repay a portion of the short-term debt incurred to finance its $16.5B acquisition of Goodrich.
Western Digital surges after beating the Street. Western Digital's (NYSE:WDC) FQ4 earnings slayed analyst estimates as net profit surged nearly 5-fold to $745M, or $2.87 a share, boosted by the company's $3.9B acquisition of Hitachi Global Storage Technologies. Revenue almost doubled to $4.75B. Western Digital provided 2013 guidance that was above consensus, demonstrating its quick recovery from the Thai flood disruptions. Shares jumped 19.5% post-market, taking some of its peers higher with it.
Alcatel-Lucent plans more job losses after swinging to loss. Alcatel-Lucent (ALU) intends to eliminate another 5,000 jobs, or around 6% of its workforce, as part of a program to save an additional €750M. The move comes after ALU swung to a Q2 net loss of €254M from a profit of €43M a year earlier. Revenue fell 7.1% to €3.55B, hurt by sharp falls in cellular spending in North America and Western Europe. Shares were -7.8% premarket.
Top Stock News
Zynga gets zynged after miserable earnings report. Zynga's (NASDAQ:ZNGA) shares plunged 37% premarket after Q2 earnings missed expectations and the Internet-games company gave 2012 guidance that was also below forecasts. Zynga swung to a loss of $22.8M from a profit of $1.4M a year earlier and adjusted EPS came in at $0.01. Revenue climbed 19.1% to $332.5M. Average daily bookings per user fell sharply, a sign Zynga is struggling to monetize mobile games and new Facebook (NASDAQ:FB) titles.
Siemens profit rises but misses forecasts. Siemens (SI) FQ3 net income rose to €823M from €462M but missed consensus due to a negative €443M pretax effect related to its Osram lighting unit. Revenue grew 10% to €19.5B. Siemens is scrapping plans to sell shares in Osram and will instead offer a "dividend in kind spinoff," whereby it will allocate shares in the unit to existing Siemens shareholders.
LVS profit sinks in the sands. Las Vegas Sands' (NYSE:LVS) Q2 net profit slumped 35% to $397.7M even though revenue rose 10.1% to $2.58B, with the bottom line hurt by a lower hold on table games play, as well as higher operational and legal expenses. Revenue missed consensus, as did adjusted EPS of $0.44. The only bright spot was Macau, the world's largest gambling center, where profits increased 9.6%. Shares fell 6.7% in AH trading.
Facebook to post first post-IPO earnings. Facebook (FB), Amazon (NASDAQ:AMZN) and Starbucks (NASDAQ:SBUX) are due to report earnings after the bell today. Facebook is expected to post Q2 EPS of $0.12 on revenue of $1.15B; Amazon's Q2 EPS is estimated to have fallen to $0.02 from $0.41 as Jeff Bezos continues his capital intensive plans for world-wide domination, with revenue seen jumping 30% to $12.89B. Starbucks' FQ3 EPS is predicted to have climbed to $0.45 from $0.36 and revenue 13.6% to $3.33B.
Lloyds sent Libor subpoenas. Lloyds (NYSE:LYG) has received subpoenas from authorities investigating the Libor scandal and is a defendant in a number of lawsuits connected to the affair. However, Lloyds hasn't yet set aside provisions to cover any penalties, although Liberum Capital estimates the bank could be liable for as much as £1.5B. Today, Lloyds (LYG) reported an unexpected H1 net loss of £641M, which was lower than a loss of £2.28B a year earlier.
Microsoft to integrate LinkedIn into Outlook. The next version of Microsoft Outlook (NASDAQ:MSFT), shipping as part of Office 2013, will feature tight LinkedIn (NYSE:LNKD) integration. The tie-up should further cement LinkedIn's dominant status in professional social networking, and might also help if the company rolls out a private networking solution to compete with Jive (NASDAQ:JIVE) and (ironically) Microsoft's Yammer, as some expect it to.
Asset managers weight up Libor action. BlackRock (NYSE:BLK), Fidelity Investments and Vanguard Group are trying to assess how Libor manipulation may have hurt their clients and whether to take legal action over the rate-rigging. The three firms collectively manage over $7T.
Merck cancer drug could be used to cure AIDS. Merck's (NYSE:MRK) Zolinza drug for a rare form of cancer may also one day be used to help cure AIDS. While existing treatments hold the disease at bay, they don't kill HIV-infected cells, which can remain hidden and then later re-emerge if treatment is stopped. However, Zolinza reactivated those cells in eight patients - the first step to expelling the virus from the body.
Nomura CEO, COO fall on their swords. Nomura (NYSE:NMR) CEO Kenichi Watanabe and COO Takumi Shibata have resigned following the third insider-trading scandal at the bank in the four years that Watanabe was leading it. Koji Nagai, the head of the securities unit, is becoming the new CEO. Meanwhile, Nomura said FQ1 net profit fell to 1.89B yen ($24.2M) from 17.7B last year.
Top Economic & Other News
Iranian nuclear program struck by thunder. The latest cyber-attack on Iran's nuclear program has apparently taken a musical-turn, with a computer worm not only shutting down the "automation network" at the Natanz and Fordo facilities, but also prompting some of the computers to play the AC/DC song "Thunderstruck" at full volume in the middle of the night.
In Asia, Japan +0.9% to 8443.1. Hong Kong +0.1% to 18893. China -0.5% to 2126. India -1.2% to 16640.
In Europe, at midday, London +1.1%. Paris +2.3%. Frankfurt +1.2%.
Futures at 7:00: Dow +1%. S&P +1.1%. Nasdaq +1.15%. Crude +1.1% to $89.94. Gold +0.6% to $1622.70.
Today's economic calendar:
8:30 Durable Goods
8:30 Initial Jobless Claims
9:45 Bloomberg Consumer Comfort Index
10:00 Pending Home Sales
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
1:00 PM Results of $29B, 7-Year Note Auction
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Notable earnings before today's open: ABB, ABC, ABX, AGCO, ALKS, ALU, AMLN, AZN, BC, BMS, BSX, BWA, CAM, CELG, CL, CME, CMS, CNX, COV, DAN, DDD, DNKN, DOW, DPS, EQT, ESV, FLIR, FNP, GG, GNC, GTI, HOT, HSY, IMAX, IP, IPG, IRM, IVZ, JNS, KMB, LINE, MCO, MHP, MJN, MMM, MYL, NBL, NEE, NOV, ORI, OXY, PCP, PCS, PHM, PLD, POT, PTEN, RCL, RTN, S, TKR, UAL, UTX, VTR, WEC, WM, WPI, XOM, ZMH
Notable earnings after today's close: AMGN, AMZN, APKT, ARBA, CA, CB, CBL, CERN, CINF, CLWR, CSTR, DECK, EXPE, FB, FBHS, GILD, HGSI, IM, INFA, KEG, KLAC, LEG, MCK, MXIM, PFG, QLGC, QLIK, RGC, RSG, SBUX, SPF, TLAB, UHS, VRSN
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