Wall Street Breakfast: Must-Know News

March 22, 2012  |  includes: AAPL, BP, CMCSA, COP, CVX, GLD, GOLD, GOOG, GS, MCD, QQQ, RIG, RIMM,SPY, USO, VZ, XOM

 

Coup in Mali sends Randgold shares reeling. Randgold Resources (GOLD) shares plummeted 15.1% premarket after a military coup in Mali, although CEO Mark Bristow said the company's operations in the country are running normally. Bristow, who is at Randgold’s Loulo complex in the west of the country, 350 km from the capital Bamako, said the situation is calm, although exact details are unclear.

McDonald's CEO Jim Skinner to step down. McDonald's (MCD) CEO Jim Skinner will retire at the end of June after 41 years with the company, with McDonald's President and COO Don Thompson appointed to replace him. Skinner's departure isn't exactly a surprise but comes earlier than many analysts expected.

Chinese, eurozone factory activity worsens. PMI data out of China and Europe indicates that the contraction in factory activity has got worse in March. HSBC's flash estimate of China's PMI fell to 48.1 from 49.7 the previous month, while Markit flash eurozone PMI dropped to 48.7 from 49.3. The numbers suggest that the eurozone has slipped back into a technical recession. The data has spooked EU shares and U.S. stock futures.

Surprise Japanese trade surplus points to recovery. While data from China and the eurozone continues to paint a gloomy picture, Japanese trade figures for February support the government's newly positive outlook. The country posted a surplus of ¥32.9B ($395M) vs. forecasts of a ¥120B deficit and a ¥1.477T deficit in January. Exports fell 2.7% on year, due to sharp falls in sales to China and Europe, but jumped 11.9% to the U.S.

Brazil indicts Chevron, Transocean over oil spill. A Brazilian federal prosecutor has formally filed criminal charges against Chevron (CVX), Transocean (RIG) and 17 of the companies' employees for last November's oil spill, raising the stakes in a legal saga that has added to Chevron's woes in Latin America and threatens to slow Brazil's offshore oil boom.

Oil giants in talks over $40B Alaska-Asia project. BP (BP), Exxon Mobil (XOM) and ConocoPhillips (COP) are discussing a $40B project to export natural gas from Alaska to Asia, sources tell The Financial Times. However, the companies first need to reach an agreement with Alaska's government regarding a North Slope oil and gas field; the government has said the oil giants have been too slow to develop the field, and has sought to revoke their lease.

Student debt exceeds $1T. Student debt may have passed $1T late last year, preliminary data from the Consumer Financial Protection Bureau shows, pushed up by a surge in college attendance, increases in tuition fees, and borrowers falling behind on payments. The debt burden has led to fears about the effect on the housing market.

BrightSource looks to buck dark solar picture in IPO. In spite of the dismal environment for the solar industry and the shares of companies dependent on it, BrightSource Energy, a provider of systems for building solar thermal power plants, plans to sell 6.9M shares for $21-$23 in an IPO under the ticker BRSE. The price range translates into a valuation of $953M-$1.04B. Brightsource's 2011 revenue surged over 11X to $159.1M, while its net loss rose 55% to $110.9M. Google (GOOG) is an investor.

Congress grills telcos over spectrum deals. Verizon (VZ) and Comcast (CMCSA) executives were yesterday grilled at Congressional hearings over Verizon's spectrum purchase/reseller deals with Comcast and other cable companies. Verizon argues it needs the spectrum provided by the agreements, but rivals, consumer groups, and at least a few Congressmen see an attempt to hoard spectrum and/or squash broadband competition.

RIM loses top spot in Canada. Research In Motion (RIMM) has lost its position as the top smartphone producer in its home nation of Canada, according to data compiled by IDC and Bloomberg. The company shipped 2.08M Blackberrys last year vs. Apple's (AAPL) 2.85M units.

Goldman's new muppet show. Will Goldman's (GS) culture change post-Greg Smith? Maybe, maybe not, but sources say the bank has begun scanning internal emails for the term "muppet" and other evidence that clients were referred to disparagingly. CEO Lloyd Blankfein is said to be taking Smith's allegations quite seriously.

Entrepreneurs build start-ups in construction industry. While the term "start-up" usually brings to mind cutting-edge high-tech firms, it turns out that the hottest area for new companies is construction. Entrepreneurs entering the sector accounted for 24% of U.S. entrepreneurial activity last year, when overall business creation dropped about 6%. With recent growth in remodeling and new-home building, workers who lost their jobs during the slump are striking out on their own.

Feedback or story tip? Please direct message WSB editor Yigal Grayeff »

Today's Markets:
In Asia, Japan +0.4% to 10127. Hong Kong +0.2% to 20902. China-0.1% to 2376. India -2.3% to 17196.
In Europe, at midday, London -0.9%. Paris -1.5%. Frankfurt -1.5%.
Futures at 7:00: Dow -0.5%. S&P -0.55%. Nasdaq -0.4%. Crude -1.1%to $106.09. Gold -0.7% to $1638.70.

Thursday's economic calendar:
8:30 Jobless Claims
10:00 FHFA House Price Index
10:00 Leading Indicators
10:00 Hearing: International Harmonization of Wall Street Reform (Tarullo)
10:30 EIA Natural Gas Inventory
12:45 PM Bernanke: 'The Federal Reserve and the Financial Crisis'
1:00 PM Results of $13B, 10-year TIPS auction
4:30 PM Fed Balance Sheet
4:30 PM Money Supply
7:30 PM Fed's Dudley: 'Building the Financial System'

Earnings Results: Companies that beat EPS expectations last night and today include Discover Financial Services (DFS), Dollar General (DG).

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

Notable earnings before Thursday's open: CAG, DG, FDX, GME, IHS, LULU,SIG, UTIW

Notable earnings after Thursday's close: ACN, MU, NKE, SLW