Wall Street Breakfast: Must-Know News

by: SA Editor Yigal Grayeff
SA Editor Yigal Grayeff
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.

Intel in reorganization of mobile ops. Intel (NASDAQ:INTC) is consolidating four units responsible for developing a variety of chips for mobile/portable devices into a single division. Intel hopes the move will put it on a better footing in the fast-growing market for smartphone/tablet application processors, where ARM-based (NASDAQ:ARMH) solutions reign supreme. Apple/Palm vet Mike Bell, who previously worked on the iPhone, will help lead the group.

Authorities find missing MF Global cash. Regulators have discovered where the MF Global (OTC:MFGLQ) funds went, Jill Sommers, who's heading the CFTC's review of the bankrupt brokerage, has said. Now it's a matter of working out which transactions were legitimate and which weren't before money can be returned to customers.

Lam to buy Novellus for $3.3B in stock. Chip equipment company Lam Research (NASDAQ:LRCX) has agreed to acquire Novellus Systems (NASDAQ:NVLS-OLD) in an all-stock transaction valued at $3.3B as the firms looks to challenge Applied Materials (NASDAQ:AMAT). Novellus stockholders will receive 1.125 shares of Lam for each of their shares, valuing Novellus at $44.42 a share, or about 12.5% above its closing price yesterday.

Chevron says it hasn't received $10.7B Brazil lawsuit. Chevron (NYSE:CVX) said it hasn’t received any formal notice of a Brazilian lawsuit against the oil giant and Transocean (NYSE:RIG) seeking $10.7B in damages from an oil spill last month. Reports said the companies have been asked to suspend operations in Brazil by prosecutors. The move could be a major blow for each, with tapping the lush oil fields located off Brazil's shore part of both firms' strategic plans.

SEC mulls appeal of Rakoff's Citi ruling. In what would be a high risk strategy, the SEC is considering appealing Judge Jed Rakoff's rejection last month of a proposed $285M settlement between the agency and Citigroup (NYSE:C), The Wall Street Journal reports. The SEC could of course use the verdict to try to negotiate a tougher settlement with Citigroup, but it hasn't done that so far.

EU banks will need to raise €200B. European banks will need to raise almost €200B in new capital, or cut their balance sheets by nearly 20%, in order to meet Basel III requirements that start taking effect in 2013, a new study from Boston Consulting Group shows. With credit markets increasingly tight, this would be no small feat. (U.S. and Asian banks face a collective shortfall of less than €70B.)

PMI falls in China and Europe. Flash PMI figures in China and the eurozone, including Germany, rose this month from November but the regions are still contracting. Regarding Germany, the reading is "a step in the right direction," said Markit economist Tim Moore, "but not enough to rescue what has been a subdued final quarter of 2011." Regarding China, "The growth momentum remains weak with additional downside risks from exports and the property market not yet fully filtering through," said HSBC's chief China economist.

RIM faces supply glut. RIM (RIMM), which reports FQ3 earnings after the close today, may be facing a supply glut of as many as 3.1M BlackBerrys and is expected to cut its sales target for the device. Analysts are also worried about pressure on margins, and a lackluster product line. The Street forecasts adjusted EPS of $1.19 and revenue of $5.26B.

SNB pledges to buy "unlimited quantities" of forex. The euro was lower against the Swiss franc despite the Swiss National Bank reiterating that the franc is still too high and should continue to weaken over time. The SNB is prepared to buy forex in "unlimited quantities," it said, and left in place its floor of 1.2 francs to the euro. At midday in Europe, the rate was 1.23 francs.

Nokia to launch U.S. fightback with bargain-priced Lumia. Nokia (NYSE:NOK) plans to re-enter the U.S. smartphone market with the launch of the Lumia 710, which T-Mobile (OTCQX:DTEGY) will sell at $50 each starting in January. That's a huge discount on the Lumia's €270 ($351) retail price in Europe.

Time running out to prevent government shutdown. House Republicans have introduced a $915B bill that would keep major government departments and services operating beyond the weekend, when temporary funding measures expire. A tentative agreement had been reached on Monday, but has hit problems as the White House also wants a deal on extending the payroll tax cut and unemployment benefits.

WTO warns on protectionism. The economic crisis threatens to increase protectionism, WTO Director General Pascal Lamy said, creating a "vicious circle where crisis erodes the capacity of governance to cooperate well." This will therefore make it more difficult to begin a recovery. "I’m afraid we have to expect difficult times for the world economy at large," Lamy said.

Apple plans R&D center in Israel. Apple (NASDAQ:AAPL) intends to join dozens of multinational companies and open an R&D center in Israel, its first such center outside of its California headquarters, Globes reports. The speculation comes as VP of R&D Ed Frank visits the country and adds to a report that Apple is in advanced talks to buy Israeli flash storage firm Anobit.

Today's Markets:
In Asia, Japan -1.7% to 8377. Hong Kong -1.8% to 18027. Shanghai -2.1% to 2181. India -0.3% to 15836.
In Europe, at midday, London +0.6%. Paris +0.8%. Frankfurt +0.8%.
Futures at 7:00: Dow +0.4%. S&P +0.5%. Nasdaq +0.3%. Crude +0.5% to $95.44. Gold +0.3% to $1591.60.

Thursday's economic calendar:
8:30 Producer Price Index
8:30 Initial Jobless Claims
8:30 Empire State Mfg Survey
8:30 Current Account
9:00 Treasury International Capital
9:15 Industrial Production
10:00 Philly Fed Business Outlook
10:30 EIA Natural Gas Inventory
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

Earnings Results: Companies that beat EPS expectations last night and today include Scholastic (NASDAQ:SCHL), VeriFone (NYSE:PAY).

Those in line include Nordson (NASDAQ:NDSN), Pier 1 Imports (NYSE:PIR).

For full real-time earnings coverage, please click here.

Notable earnings before Thursday's open: DFS, FDX, PIR, RAD

Notable earnings after Thursday's close: ACN, ADBE, RIMM

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