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
Apple, China Mobile sign iPhone deal. Apple (NASDAQ:AAPL) and China Mobile (NYSE:CHL) have finally inked a long-awaited agreement for the latter to sell iPhones, the WSJ reports. Apple will now have access to the carrier's 700M subscribers, seven times the size of Verizon's (NYSE:VZ) base. A rollout of the phones is expected this month, although there's no word of the iPad in the report. The news comes after the Chinese government issued 4G licenses yesterday. Apple's shares were +1.5% premarket.

GM to scale down Chevy sales in Europe. GM (NYSE:GM) plans to end mainstream sales of Chevrolet cars in Europe by the end of next year and focus on its Opel and Vauxhall brands, although the company will still sell Chevrolets in Russia. GM will also focus on "iconic" Chevy products in Europe such as the Cadillac. The shift, which comes amid falling Chevy sales, will cost GM $700M-1B, most of which the firm will book this quarter and in H1 2014.

Top Stock News
JPMorgan warns 465K card holders of data breach by hackers. JPMorgan (NYSE:JPM) has said hackers may have accessed the personal data of 465,000 holders of prepaid cash cards. The bank believes that "a small amount" of information was stolen, although not money or critical personal details such as social security numbers, birth dates and email addresses. The 465,000 affected customers represent 2% of the 25M people who hold the cards.

Siemens enjoys turnaround at infrastructure and cities ops. Siemens (SI) expects profit margins at its struggling infrastructure and cities division to rise to about 7% of sales this FY from 1.6% a year earlier. The improvement in the performance of the business is due to restructuring and a clearer focus on high-margin contracts.

AT&T eyes $2.75B Verizon spectrum. AT&T (NYSE:T) is reportedly thinking about bidding for spectrum licenses owned by Verizon Wireless (VZ), which bought the assets for $2.4B and may receive up to $2.75B in any deal. An AT&T bid could put it up against T-Mobile US (NASDAQ:TMUS), whose marketing strategy has included targeting its larger rival in the companies' battle for customers.

Costco's FQ1 sales rise 5%. Costco's (NASDAQ:COST) net revenues grew 5% to $24.47B in FQ1, with comparable sales rising 3%. Excluding the negative impact of gasoline price deflation and foreign exchange, comparable turnover climbed 5%.

DOJ plans more mortgage fraud cases in New Year. The Department of Justice intends to bring cases against several financial institutions next year for what it says is mortgage-bond fraud, Attorney General Eric Holder told Reuters yesterday. While Holder said that the DOJ would use JPMorgan's (JPM) $13B agreement as a template, he didn't provide details about which banks are in his crosshairs. Firms that have acknowledged that they are under investigation include Bank of America (NYSE:BAC), Citigroup (NYSE:C) and Goldman Sachs (NYSE:GS).

Ford could see halo effect from new Mustang. While (GM) scales back Chevrolet in Europe, the age-old battle between the Ford (NYSE:F) Mustang and the Chevy Camaro takes a new twist today, with Ford unleashing the redesigned Mustang on global markets. By market share, Camaro has raced past Mustang, but the iconic car also has a "halo" effect that has helped the Ford brand.

Top Economic & Other News
Japan OKs ¥18.6T stimulus package. As flagged, Japan's cabinet has approved an ¥18.6T ($182B) stimulus plan to offset a hike in sales tax that is due to go into effect in April. However, there's a bit of smoke and mirrors in play, as much of the package includes investment that was already scheduled. The cabinet expects the measures to add 1% point to GDP and create around 250,000 jobs, although economist Hiroshi Miyazaki isn't as optimistic.

WTO credibility at stake as nations struggle to reach deal. U.S. and European officials hope a deal can be struck at a meeting of the World Trade Organization's 159 members, which is taking place in Bali, even though India has said it won't compromise on subsidizing food for the poor. A draft agreement for what are known as the Doha round of talks would let the country provide the subsidies for another four years, but it wants to be able to continue its policy indefinitely. A failure to finalize a pact this week could seriously damage the WTO's stature, officials have warned.

China bank ban leads to Bitcoin selloff. The People's Bank of China has banned banks from trading in Bitcoin (BITCOIN), explaining that the virtual currency doesn't have "real meaning," nor the same legal status as a formal currency. The move is also probably tied to Beijing's desire to regulate the yuan, although private individuals remain free to trade Bitcoins. The currency was -15.8% at $1,000 at the time of writing.

Moody's ups outlook on Spain to stable. Moody's has joined S&P and lifted its outlook on Spain to stable from negative, citing three reasons: indications of a "sustained rebuilding" of the economy and an improved outlook for the medium term; a "material decrease" in risks to Spain's market access and to contagion from other parts of the eurozone; and a significant fall in contingent liabilities in the banking sector. Moody's also affirmed its rating on Spain at Baa3.

OPEC maintains crude output cap at 30M bpd. As expected, OPEC has agreed to keep its daily oil production limit at 30M barrels, due to uncertainty about the outlook for supply and demand. However, there are factors that could force prices to fall from the relatively stable level of $100 a barrel. Iran plans to increase output as quickly as possible if and when international sanctions are lifted, while U.S. shale supply continues to rise and new oil from Kurdistan could boost Iraqi exports.

Alpha-Rich Stock Movers and Great Calls
1) On Monday, Joe Springer called Tonix Pharmaceuticals (NASDAQ:TNXP) a potential "multi-bagger" with massive market potential. Shares are +37.1% since. Read article »
2) On October 21, BPD Research cited the diverse pipeline at OncoMed Pharmaceuticals (NASDAQ:OMED) as a catalyst for significant upside. After partnering with Celgene on a key drug this week, OncoMed is +97.7% to date. Read article »

Alpha-Rich Stocks To Watch
1) Veeva Systems (NYSE:VEEV) is SaaS's biggest bubble and tech's best short, writes Suhail Capital. Read article »
2) Ashleigh Rogers says Stonegate Mortgage (NYSE:SGM) could double, thanks to organic growth, acquisitions, and scale. Read article »

Alpha-Rich articles are the best long and short ideas on Seeking Alpha. SA PRO subscribers receive early access to these Alpha-Rich articles, which often move markets. For more information about SA PRO and becoming a subscriber, click here.

Today's Markets:
In Asia, Japan -1.5% to 15177. Hong Kong -0.1% to 23713. China -0.2% to 2247. India +1.2% to 20958.
In Europe, at midday, London flat. Paris -0.1%. Frankfurt +0.1%.
Futures at 6:20: Dow -0.1%. S&P flat. Nasdaq +0.1%. Crude +0.4% to $97.59. Gold -1.1% to $1233.60.
Ten-year Treasury Yield -1 bps at 2.83%

Today's economic calendar:
Chain Store Sales
7:30 Challenger Job-Cut Report
8:30 Initial Jobless Claims
8:30 GDP Q3
8:30 Corporate Profits
9:45 Bloomberg Consumer Comfort Index
10:00 Factory Orders
10:30 EIA Natural Gas Inventory
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

Notable earnings before today's open: CONN, DG, FRAN, JOSB, KR, MEI, RY, SOL, TD, TITN

Notable earnings after today's close: AMBA, COO, DMND, FIVE, FNSR, PSUN, ULTA, ZUMZ

See full real-time earnings coverage »

Wall Street Breakfast is sent out by email for free -- Get it now »

About this article:

Tagged: , , Wall St. Breakfast
Want to share your opinion on this article? Add a comment.
Disagree with this article? .
To report a factual error in this article, click here