market update

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

Today’s Top Stories:

  • Larry Fink Says Buy Equities: Blackrock’s L Fink says investors should be 100% in equities due to attractive valuations and the potential for higher returns.  “I don’t have a view that the world is going to fall apart, so you need to take on more risk,” he said in an interview with Bloomberg Television in Hong Kong today. “You need to overcome all this noise. When you look at dividend returns on equities versus bond yields, to me it’s a pretty easy decision to be heavily in equities.” http://bloom.bg/x7guTI
  • Banks are Reserved for Settlement: Reuters says the nation’s biggest banks are largely reserved for the cost of the $25B foreclosure settlement.  “If they’re not fully reserved, I’ve got to believe the industry is pretty close (Reuters)
  • CIT Redeeming Notes: announced that it will redeem all of its nearly $4 billion of remaining 7% Series A Second-Priority Secured Notes
  • RBS CEO Considered Leaving: Stephen Hester said he considered resigning from the company over the bonus outcry (London Telegraph)
  • New Bonus Plan at RBS: on Tues talked about a new “special plan” bonus pool it will use to retain key employees (FT)
  • Citi on OPEN: “Mixed but solid fundamental trends: 21% yoy rev growth in Q4 implies a 7-pt deceleration vs Q3?s organic growth rate of 28% yoy on a 2-pt tougher comp” (Citi)
  • DB Said to Limited Bonuses: Deutsche Bank AG, Germany’s largest lender, told employees it will impose a 200,000 euro ($266,000) cap on bonuses paying out this year, said three people with knowledge of the discussions (BBG)
  • Jana Decreases MHP Stake: Jana Partners disclosed that it decreased its ownership to 2.8% of the outstanding common shares of McGraw-Hill (NYSE:MHP) which is planning a spin-off event for its businesses in 2012 http://bit.ly/y3EXYA
  • Greece Update: Greek PM negotiations with party leaders continue; Athens missed another deadline to secure second aid package
  • Recent IPO: Caesars completed IPO that gives casino chain market value $1.13b

M&A Watch:

  • Weekly M&A Trends: This week saw some big jumps in Debt underwriting and M&A activity. Announcedinvestment banking M&A increased +22% from the prior week to $34bn, M&A volumes are still very low for the start of the year http://bit.ly/vZUMkZ
  • Amazon.com, Viacom may announce web-video deal this week – Reuters says; watch Netflix
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.
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