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.

Facebook plans IPO for May. Facebook (NASDAQ:FB) intends to hold its IPO in May, The Wall Street Journal reports, with the company planning to release another amended S-1 prior to its offering after filing one on Tuesday. The speculation adds to reports that Facebook has halted the trading of its shares on secondary exchanges.

German jobless rate hits record low. German unemployment dropped to 6.7% in March, the lowest since comparable records began in 1998, from 6.8% in February. The decline came despite the eurozone debt crisis and indicates that the German economy may be recovering from its dip. And while new orders fell 16% in February on an annual basis, industry group VDMA expects production to pick up again in H2.

Sanctions bite as Iranian oil exports fall sharply. By the end of March, Iran's oil exports are expected to have fallen by 300,000 barrels a day from last month, an almost 14% drop from 1.9M bpd, according to oil-shipping specialist Petro-Logistics. Iran's exports are likely to further shrink if President Obama decides by Friday, as expected, that markets can adjust to less Iranian oil.

Roche caves in and raises Illumina bid. Roche (OTCQX:RHHBY) has increased its hostile offer for Illumina (NASDAQ:ILMN) by 15% to $51 a share, or to around $6.7B, hoping to close a deal more quickly with shareholders that have thus far been unimpressed by Roche's first offer. Illumina's stock closed at $49.88 yesterday, above the initial $44.50 a share proposal. Illumina was +2.3% premarket.

Businesses left hanging as Justices mull Obamacare. After three days of arguments, uncertainty exists about how the Supreme Court will rule on the constitutionality of the overhaul of the $2.6T healthcare system. A decision to void the revamp would upend years of corporate planning, with insurers, for example, having to abandon programs to bring in millions of new customers. A decision is due in June.

Analysts hope to hear how Heins can revive RIM. RIM (RIMM) is due today to report its first quarterly earnings results since the appointment of Thorsten Heins as CEO two months ago, with analysts forecasting that FQ4 EPS slumped 55% to $0.81 and that revenue dropped 19.1% to $4.53B. While expectations are exceptionally low, investors are hoping, in the words of Morgan Stanley's Ehud Gelblum, "to hear if [Heins] has a plan," because "it is hard to figure out how they turn this around."

Japan infected by American gridlock disease. Japan's government will draft a stop-gap budget for the first time in 14 years as lawmakers struggle to pass a spending bill before the new fiscal year starts on Sunday. A proposed sales tax increase is one of the main points of contention. The stop-gap measure will total ¥3.6T ($43.4B), and will pay for spending and government costs for the first six days of April.

Japan retail sales strengthen optimism about economy. While Japan’s parliament struggles with the budget, the economy continues to show signs of recovery, with retail sales rising 3.5% on year in February, the largest gain since August 2010. The figures were boosted by a 21.4% jump in automobile sales. "Today’s report adds to evidence that Japan’s economy will return to growth this quarter," BNP Paribas economist Azusa Kato said.

TEPCO teeters on the edge of insolvency. TEPCO (OTCPK:TKECF) faces bankruptcy unless the government approves a ¥1T ($12.2B) injection. The company's capital has fallen to ¥620B from almost ¥2T before the Fukushima disaster.

Tomorrow arrives as the sun comes out for Annie's. Shares in organic foods maker Annie's (NYSE:BNNY) soared 89% on their debut yesterday, showing that frenzied enthusiasm for IPOs exists outside the Internet sector. Despite the huge rise from Annie's listing price of $19 a share, Jim Cramer reckons that the company's tremendous growth potential and its position in an attractive niche market make it a safe buy.

EU finmins to bump up rescue fund. EU finance ministers are expected to agree tomorrow to run the ESM and EFSF rescue programs side-by-side, effectively bumping the so-called firewall to €700B. They also appear ready to allow €240B in untapped funds from the EFSF to be available for another year, raising said wall temporarily to €940B.

Shades of Enron as House panel gets nowhere with MF execs. MF Global (OTC:MFGLQ) executives yesterday frustrated Congressmen in a hearing about the firm's collapse, with key figure Edith O'Brien pleading the fifth, as expected, and then three others pleading ignorance. "This reminded me of a hearing we had…on Enron," where no one would admit to anything, said Rep. Michael Capuano.

Hawker Beechcraft gets ready for crash landing. Hawker Beechcraft, the aircraft manufacturer bought by Goldman Sachs' (NYSE:GS) P-E arm and Onex Corp (OTCPK:ONEXF) for $3.3B in 2007, is preparing to file for bankruptcy protection in the next several weeks, Reuters reports. Hawker has struggled to compete with larger rivals amidst the economic downturn.

S&P 500 to become Fossil-ized. Fossil (NASDAQ:FOSL), a provider of fashion accessories, will be added to the S&P 500 to replace Medco Health (NYSE:MHS) after it's acquired by Express Scripts (NASDAQ:ESRX), provided regulators don't get in the way.

Today's Markets:
In Asia, Japan -0.7% to 10115. Hong Kong -1.3% to 20609. China -1.4% to 2252. India -0.4% to 17059.
In Europe, at midday, London -0.8%. Paris -1.1%. Frankfurt -1.1%.
Futures at 7:00: Dow -0.25%. S&P -0.3%. Nasdaq -0.3%. Crude -0.5% to $104.92. Gold -0.1% to $1656.30.

Thursday's economic calendar:
8:30 GDP Q4
8:30 Initial Jobless Claims
8:30 Corporate Profits
10:30 EIA Natural Gas Inventory
10:30 Fed's Lacker: 'Credit Markets Symposium conference'
11:00 KC Fed Manufacturing
12:15 PM Fed's Lockhart: European Economic Crisis
12:45 PM Bernanke: 'The Aftermath of Crisis'
1:00 PM Fed's Plosser: Economic Outlook
1:00 PM Results of $29B, 7-Year Note Auction
3:00 PM USDA Ag. Prices
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
6:45 PM Fed's Lacker: Economic Outlook

Earnings Results: Companies that beat EPS expectations last night and today include Red Hat (NYSE:RHT), Verint Systems (NASDAQ:VRNT). Notable earnings before Thursday's open: BBY. Notable earnings after Thursday's close: RIMM, TIBX. For full real-time earnings coverage, please click here.