Wall Street Breakfast: Must-Know News

by: Rachael Granby
Rachael Granby
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.

  • Alcatel-Lucent fills top spots. In an effort to create a cohesive management team and shore up its finances, Alcatel-Lucent's (ALU) board has chosen two Europeans to fill top positions in the Franco-American company. Ben Verwaayen, a Dutchman who previously headed BT Group, will become the new CEO, and Frenchman Philippe Camus, formerly an aerospace executive, will serve as the firm's non-executive chairman. The choice of two Europeans indicates that Alcatel-Lucent is looking to end trans-Atlantic tensions that have caused problems since the merger two years ago of France's Alcatel and U.S. Lucent Technologies.
  • KDB, Lehman get serious. Korea Development Bank [KDB] is now in advanced talks with Lehman (LEH) to buy up to 25% of the investment bank for up to $6B. Earlier talks between state-run KDB and Lehman had stalled after Korean officials had discouraged the deal. Though still concerned, Korean officials have taken a step back and said they won't oppose or support any deal until the pricing details are known. If talks stall once again, Lehman may look to China's CITIC Securities or Middle East sovereign wealth funds for an alternative buyer.
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  • Oil falls on limited Gustav damage. Crude oil fell 7.8% to $106.40 (4:14am), its lowest trading price in five months. The price drop comes as U.S. Gulf Coast producers and refiners prepare to re-start production after Hurricane Gustav passed by without causing major damage to oil companies' infrastructure. Signs of weakening global demand and a rising dollar have also helped depress oil prices, which have fallen 28% from their July 11 high of $147.27 per barrel.
  • New study favors surgery over stents. According to a study released yesterday, bypass surgery is a better choice than a heart stent for seriously ill patients. The study, sponsored by Boston Scientific (NYSE:BSX), deals a major blow to the leading stent maker's efforts to make a scientific case that heart stents are the better option for the sickest heart patients. Analysts expect the study's outcome to lower sales for stent makers.
  • Google goes Chrome. Google (NASDAQ:GOOG) continues to take the battle to Microsoft (NASDAQ:MSFT) and has announced plans to launch its own web browser, Chrome. An early version of Chrome will be available for download starting today, and Google claims that it makes web browsing faster and makes it easier to run applications without dowloading software. Chrome will compete directly with Microsoft's Internet Explorer browser, which has a 72% market share amongst web users.
  • Japanese firm to buy U.S. pharmaceutical. On Monday, Japanese pharmaceutical manufacturer Shionogi (OTC:SGIOF) announced a definitive agreement to acquire U.S. peer Sciele Pharma (SCRX) for approximately $1.1B, or $31 per share, representing a 61% premium on Sciele's share price. The acquisition gives Shionogi immediate access to the U.S. market and increases its product pipeline. The deal follows similar moves by Takeda (OTC:TKPHY) and Daiichi Sankyo (OTCPK:DSKYF).
  • Aussie banks lower rates. Australia's central bank reduced borrowing costs, leading Australia's four biggest commercial banks to announce plans to cut interest rates on variable home loans. The banks will pass on the full quarter point interest rate cut, which should help homeowners who are facing a 22-year low in housing affordability. The benchmark interest rate was lowered to 7% from a 12-year high.
  • Brown boosts housing funds. U.K. Prime Minister Gordon Brown wants to accelerate a $1.8B spending plan aimed at reversing Britain's worst housing slump in at least 18 years. Brown's plan would tap some of the $11.7B earmarked for social-housing programs over the next three years and would shift the funds so that more is used this year. The money would be used to help people buying new homes or struggling to meet their mortgage payments.

Today's Markets

  • Asia markets closed mixed. Nikkei -1.75% to 12,609. Hang Seng +0.65% to 21,042. Shanghai -0.9% to 2,305. BSE +3.8% to 15,050.
  • In Europe at midday, London +0.5%. Paris +0.8%. Frankfurt +1.2%.
  • U.S. futures at 7:00 AM: Dow +0.75%. S&P +0.7%. Nasdaq +0.93%. Crude -6.4% to $108.07 (low: $105.46). Gold -2.85% to $811.40.

Tuesday's Economic Calendar

Seeking Alpha editor Eli Hoffmann contributed to this post.

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