Wednesday November 9th, 2011

Every morning the Street of Walls team puts out an update on market levels, today’s top stories, and active M&A deals.

Morning Market Levels:

  • S&P futures are down -30 points to 1,243
  • Europe: DJ Euro Stoxx -2.5%, FTSE -2.2%, CAC -2.3%, DAX -2.6%, Spain -2.2%, Italy -3.6%
  • Asia: Japan 1.2%, Hong Kong 1.7%, India -1.2%, Australia 1.2%
  • USD (DXY) up 1.20%
  • Gold up 0.59% to $1,798.3
  • Silver down -0.58% to $34.9
  • Copper down -1.33% to $348.8
  • Crude down -1.84% to $95.1
  • Corn down -0.19% to 659.3
  • Wheat down -1.10% to $649.8
  • 10yr Treasury yields are up, trading at 1.98%
  • S&P current trading at 12.88x current year P/E

Today’s Top Stories:

  • Italy Debt Markets Very Weak: 10yr yields up 65-70bp (7.4%); 2-10 inverts; BTP/bund spread +73bp (568bp); WSJ says EU drawing up contingency plans
  • AAPL Trimming Orders: Apple has informed upstream suppliers of parts and components for iPhone 4S to delay part of their shipments for the fourth quarter of 2011 to the first quarter of 2012 as sales of the iPhone 4S have not been as strong as those concluded in the pre-sales period and also due to shortages in the supply of some key components, according to sources at the iPhone 4 supply chain http://bit.ly/rxmqV2
  • 65% Change of Banking Crisis: “There is a 65 percent chance of a banking crisis between November 23-26 following a Greek default and a run on the Italian banking system, according to analysts at Exclusive Analysis” http://bit.ly/ut04Z7
  • Deutsche CEO Warns of Crisis: “I don’t think you’ll see a [disorderly] default in any country. You’ll always have a voluntary burden-sharing” (FT)
  • College Tuition Price War: The president of the University of Charleston told CNBC Tuesday the West Virginia college will cut tuition 22 percent next year to draw students who might otherwise be unable to afford college http://bit.ly/rSCy06
  • 10am Highway Bill Today: “The Senate EPW Cmte will vote on a two-year reauthorization of highway spending. The current program expired in late 2009, and has been temporarily extended since then. The most recent extension expires in March 2012.   The Senate bill would maintain current funding levels for two more years, despite the projected shortfall in gasoline tax revenues compared with projected spending levels” (Goldman Research)
  • Lone Pine Buys WYN: Stephen Mandel, Jr.’s Lone Pine Capital disclosed a 5.4% ownership of the outstanding common stock of Wyndham Worldwide Corporation (NYSE:WYN) and a 5.5% ownership of the outstanding common stock of Netease.com, Inc. (Nasdaq:NTES) on Nov. 7th http://bit.ly/t4IXE5
  • Adobe Cutting Jobs: Cutting 750 jobs, guides lower on earnings announced yesterday after the close

Economic Calendar:

  • Wednesday: Wholesale Inventories
  • Thursday: Import Price Index, Trade Balance, Initial Jobless Claims, Monthly Budget Statement
  • Friday: U. of Mich Confidence

M&A Watch:

  • Alibaba Group, Softbank said to be talking with PE funds about making bid for all of Yahoo! without co.’s blessing (BBG)
  • Sony said to be negotiating to buy Big Machine Label Group; Big Machine may fetch >$200m (BBG)
  • Julius Baer said in lead to buy stake in Bank Sarasin held by Rabobank; may pay 35-45 Swiss francs per shr (BBG)
Disclosure: I do not have a position in any stocks mentioned in this article, do not have a plan to initiate a position within the next 72 hours.
Disclaimer:  The information, opinions, material, and any other content provided in this article is for informational purposes only and is not to be used or considered an offer or solicitation to buy or sell securities, investment products, financial instruments, or to participate in any particular investment strategy. The information, opinions, material, and any other content provided in this article does not constitute as a recommendation or as advice to buy or sell securities, investment products,  financial instruments, or to participate in any particular investment strategy.