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.

Top Stories
PC shipments plunge. Global PC shipments slumped 13.9% on year to 76.9M units in Q1, estimates IDC, which blamed the introduction of Microsoft's (NASDAQ:MSFT) Windows 8 for the drop. "The Windows 8 launch not only didn't provide a positive boost to the PC market, but appears to have slowed (it down)," IDC said. H-P (NYSE:HPQ) was the market leader even though its share fell to 15.7%, while Lenovo (OTCPK:LNVGY) came in at number two and Dell (DELL) at number three.

Japanese car makers recall 3.4M vehicles. Four Japanese car makers have recalled 3.4M vehicles globally due to a malfunctioning inflator in the front-seat airbags, which are made by Takata (OTC:TKTDF), although no injuries or deaths have been reported. Toyota (NYSE:TM) is recalling 1.73M cars, Honda (NYSE:HMC) 1.14M, Nissan (OTCPK:NSANY) 480,000 and Mazda (OTCPK:MZDAY) 45,500. Takata's shares slumped 9% in Tokyo, although Toyota's rose 2.5% in U.S. premarket trading.

Top Stock News
MetroPCS receives improved bid from Deutsche Telekom. MetroPCS (PCS) shares increased 2.4% in post-market trading after Deutsche Telekom (OTCQX:DTEGY) made a "best and final offer" for merging the prepaid carrier with T-Mobile USA. The new bid would reduce the combined company's debt by $3.8B to $11.2B, cut the interest rate on the debt by 50 bps, and extend the lockup on DT's stake in the new entity by six months to 18 months.

Dow, S&P close at record highs - again. Stock futures were mixed premarket after the Dow Jones and S&P 500 again hit record highs yesterday. Investors took comfort from the minutes of the latest FOMC meeting, which said that participants "generally judged" that the macroeconomic benefits of the bond purchase program outweigh the costs and risks. The Nikkei continued its BOJ-induced surge, jumping 2% to 13,549.16, its highest close since July 2008.

Noble to double in size - CEO. Noble Energy (NYSE:NBL) CEO Charles Davidson has predicted that the company will double in size in the next five years in terms of production, cash flow and reserves. Davidson is in Israel to mark the recent start of gas output from the Tamar field, in which Noble is one of the operators. Davidson also said that a natural gas pipeline from Israel to Turkey has been explored.

Senators agree to gun-control deal. Senators yesterday agreed on a bipartisan compromise to expand criminal background checks of gun buyers in a deal that should facilitate a debate on the Senate floor, although it's expected to meet opposition in the House. The measure calls for checks for Internet sales and those between private parties at gun shows, but not on non-commercial person-to-person deals. Stocks on watch today include Smith & Wesson (SWHC) and Sturm, Ruger (NYSE:RGR), which slumped 4.1% in AH trading.

Ex-Apple execs follow Ron Johnson out the door. Three former Apple executives who were hired by ousted J.C. Penney (NYSE:JCP) CEO Ron Johnson have reportedly left the department-store company. The departures are COO Mike Kramer, who received a compensation package of $33.4M when he joined JCP, Chief Talent Officer Daniel Walker, who got $20.2M, and Chief Creative Officer Mike Fisher.

GM eyes high growth in Africa. Annual vehicle sales in Africa will climb almost 20% to 2M in the next two years, GM (NYSE:GM) predicts, as a growing middle class trade up their motorbikes and jalopies for new cars. GM sold 180,000 vehicles in Africa last year, mostly in the north and south. That leaves the countries in between, which is where the car maker sees a "huge opportunity for growth."

Government could sell TVA. The White House will consider selling the Tennessee Valley Authority as part of a strategic review, the administration said yesterday in its budget proposal. A sale would help the government chip away at its debt, although the idea has already sparked opposition from a senior GOP Senator. The TVA earned a net profit of $60M last year on revenues of $11.2B.

Top Economic & Other News
Banks, lobbyists got FOMC minutes a day before everybody else. The Fed accidentally sent the minutes of the latest FOMC meeting on Tuesday afternoon to 150 e-mail addresses that included bankers and lobbyists. Once Fed officials realized the mistake, they published the minutes yesterday morning, well ahead of the scheduled time. Still, the leak raises questions about how the Fed handles sensitive information. The big banks that enjoyed the Fed advantage include JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), Nomura (NYSE:NMR) and Citigroup (NYSE:C).

Kuroda: BOJ inflation target "flexible." Bank of Japan Governor Haruhiko Kuroda said today that the BOJ's target of hitting inflation of 2% within two years is "flexible," as is the case at other central banks. The BOJ could modify its policy according to a number of factors, such as GDP, employment and asset markets. Kuroda also said the BOJ has taken all "necessary" and "possible" measures to achieve its inflation goal.

Obama signs $109B sequester order for 2014. President Obama yesterday signed a $109B sequester order for FY 2014, with discretionary spending set to drop by $91B to $967B, the lowest amount since 2004. The signing came just hours after Obama introduced a budget that would replace those sequester cuts.

China's forex reserves surge. China's foreign exchange reserves climbed by $130B to $3.44T in Q1, the largest quarterly rise for almost two years. The inflow helped boost credit growth, with total new financing surging 58% on year to 6.2T ($1T). Bank loans rose 16% but those in the "shadow-banking" system, which have caused much concern, more than doubled.

Greek unemployment continues to climb. Greek unemployment rose to yet another record high of 27.2% in January from 25.7% in December as the country's depression continued unabated. Youth unemployment hit 59.3%, up from 51% a year earlier.

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Today's Markets:
In Asia, Japan +2% to 13549. Hong Kong +0.3% to 22101. China -0.3% to 2220. India +0.7% to 18542.
In Europe, at midday, London +0.3%. Paris +0.5%. Frankfurt +0.5%.
Futures at 7:00: Dow +0.1%. S&P +0.05%. Nasdaq -0.1%. Crude -0.1% to $94.55. Gold -0.1% to $1558.80.

Today's economic calendar:
Chain Store Sales
6:00 Fed's Plosser: Economic Outlook
8:30 Initial Jobless Claims
8:30 Import/Export Prices
9:45 Bloomberg Consumer Comfort Index
10:30 EIA Natural Gas Inventory
1:00 PM Results of $13B, 30-Year Note Auction
3:00 PM Consumer Credit
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

Notable earnings before today's open: PIR, RAD

See full real-time earnings coverage »

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