Market Levels
• US: Dow Futures: 13150.00 (0.05%), S&P 500 Futures: 1415.20 (-0.06%), NASDAQ Futures: 2631.25 (-0.18%)
• Europe: CAC: 3599.61 (-0.10%), DAX: 7509.29 (-0.11%), FTSE: 5910.56 (-0.06%).
• Asia-Pacific: Australia: 4557.90 (0.13%), China: 2083.77 (1.05%), Hong Kong: 22276.72 (0.38%), India: 5908.90 (0.03%), Japan: 9533.75 (0.07%).
• Metals: Gold: 1718.00 (0.73%), Silver: 33.42 (0.89%), Copper: 3.71 (0.37%)
• Energy: Crude Oil: 86.65 (0.84%), Natural Gas: 3.44 (-3.04%)
• Commodities: Corn: 7.30 (-2.09%), Soya Bean: 14.67 (1.31%), Wheat: 8.56 (-0.32%)
• Currency: EUR/USD: 1.2934 (0.05%), GBP/USD: 1.6089 (0.31%), USD/JPY: 82.2000 (-0.35%)
• 10 year US Treasury: 1.606% (-0.015)
Market and Economic News Update
U.S. stock-index futures largely unchanged: U.S. stock-index futures are pointing to a flat open on Monday as investors focused on the budget talks on Capitol Hill. Meanwhile, President Barack Obama is scheduled to speak in Detroit, and investors will be watching for any clues from the President on the progress of the looming “fiscal cliff.” On Sunday, President Obama and Republican Speaker of the House of Representatives John Boehner met at the White House to talk about how to avert billions in automatic tax hikes and spending cuts set to start in the new year, but the two sides didn’t provide further details.
European markets fall: European markets reversed from lows made earlier in the session, but are still down in trade amid political uncertainty in Italy, after Prime Minister Mario Monti said he will step down before his term ends. Elsewhere, Greece’s offer to buy back around 30 billion euros ($38.7 billion) in bonds has been extended for an extra day, according to reports by Reuters. The German DAX (INDEXDB:DAX) was trading 0.1 percent lower at 7509.29, the FTSE 100 (INDEXFTSE:UKX) lost 0.1 percent to 5910.56 and the CAC 40 (INDEXEURO:PX1) shed 0.1 percent to 3599.61. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was down 0.6 percent.
Asian markets close higher: Asian markets ended higher on Monday as investors welcomed positive economic data from China. Industrial output in the country rose 10.1 percent in November from the year-ago period, while retail sales gained 14.9 percent. Japanese economy, however, contracted for the second straight quarter in July-September, government data showed on Monday. The NIKKEI 225 (INDEXNIKKEI:NI225) gave up gains made earlier in the day to end 0.1 percent higher at 9,533.75 points. The HANG SENG INDEX (INDEXHANGSENG:HIS) finished 0.4 percent higher at 22,276.72 , while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) jumped 1.1 percent at 2083.77. The S&P/ASX 200 (INDEXASX:XJO) index added 0.1 percent to 4,557.9 points. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index fell 0.2 percent.
Stocks in Focus
American International Group, Inc. (NYSE:AIG)
American International Group, Inc. (NYSE:AIG) has agreed to sell 80.1 percent of its airplane leasing unit, International Lease Finance Corp., to a Chinese investor group, for about $4.2 billion. The consortium, led by Weng Xianding, chairman of New China Trust, have the option to buy another 9.9 percent, New York-based American International Group, Inc. (NYSE:AIG) said today in a statement. The deal is expected to close in the second quarter of 2013, and ILFC would remain as a U.S. corporation. American International Group, Inc. (NYSE:AIG) is up percent in early morning trade.
McDonald’s Corporation (NYSE:MCD)
McDonald’s Corporation (NYSE:MCD) reported better-than-expected November sales at established restaurants, both globally and in each individual region, reversing the decline it reported for October. McDonald’s Corporation (NYSE:MCD) said global sales at restaurants open at least thirteen months rose 2.4 percent in November. Analysts were expecting a 0.17 percent rise. U.S. sales were up 2.5 percent versus estimates of a 0.4 percent drop, while European sales rose 1.4 percent compared to estimates of a 0.1 percent gain. McDonald’s Corporation (NYSE:MCD) has seen sales growth slow as the company faces an uncertain global economy and heightened competition from rivals offering coupons. Investors sent McDonald’s Corporation (NYSE:MCD) shares up 2 percent in pre-market trading on Monday.
BEAM Inc (NYSE:BEAM)
Diageo plc (LON:DGE) (NYES:DEO) has held talks with Japanese drinks group Suntory Holdings Ltd. about acquiring bourbon whisky maker BEAM Inc (NYSE:BEAM) for more than $10 billion (6.2 billion pounds), Britain’s Sunday Telegraph reported, citing unidentified sources. Diageo plc (LON:DGE) (NYES:DEO) held the discussions with the Osaka-based company in the spring and summer, though a deal was unlikely in the near future, sources told the newspaper. BEAM Inc (NYSE:BEAM), the maker of Jim Beam, Maker’s Mark and Canadian Club liquor, already has a distribution tie-up with Suntory.
Yahoo! Inc. (NASDAQ:YHOO)
Yahoo! Inc. (NASDAQ:YHOO) and NBC Sports Group announced a deal on Monday that will see the two companies promote each others sports content. Yahoo! Inc. (NASDAQ:YHOO) and NBC, owned by Comcast Corporation (NASDAQ:CMCA), will work together on news and events coverage on the internet as well as on television, but will maintain separate websites and independent newsrooms. The collaboration will give Yahoo! Inc. (NASDAQ:YHOO) access to NBC’s video content, live sports coverage and big name television personalities. Yahoo! Inc. (NASDAQ:YHOO) also has a content sharing agreement with ABC News.
Arris Group, Inc. (NASDAQ:ARRS)
Cable-equipment maker Arris Group, Inc. (NASDAQ:ARRS) and U.K.-based Pace plc (LON:PIC) emerged as the lead bidders for Google Inc (NASDAQ:GOOG)’s Motorola Home unit, Bloomberg reported on Sunday. Google Inc (NASDAQ:GOOG) had acquired the business as part of its $12.5 billion purchase of Motorola Mobility Holdings Inc. in May, and received multiple offers on December 7. Google Inc (NASDAQ:GOOG) was looking to fetch about $2 billion for the unit, a person familiar with the situation told Bloomberg. Google Inc (NASDAQ:GOOG) and Arris Group, Inc. (NASDAQ:ARRS) could not be reached for comment.
Delta Air Lines, Inc. (NYSE:DAL)
Delta Air Lines, Inc. (NYSE:DAL) and Virgin Atlantic will form a joint venture on trans-atlantic flights once Delta Air Lines, Inc. (NYSE:DAL) buys Singapore Airlines’ 49 percent stake in the British carrier, according to a Reuters report. Delta Air Lines, Inc. (NYSE:DAL) and Virgin are planning to unveil a code-sharing agreement, allowing the carriers to sell flights on the other airline and share revenues from ticket sales. Virgin Atlantic has 19 flights a week between the US and the UK, the making it the second-biggest operator of transatlantic flights out of London’s Heathrow airport. Delta Air Lines, Inc. (NYSE:DAL) offers only 10 such flights. Singapore and Delta Air Lines, Inc. (NYSE:DAL) are still in talks over the sale of the stake, and a deal is expected as early as this week, according to people close to the talks. Delta Air Lines, Inc. (NYSE:DAL) was inactive in pre-market trading.
Ingersoll-Rand PLC (NYSE:IR)
Dublin-based industrial conglomerate Ingersoll-Rand PLC (NYSE:IR) said it will spin off its security-technology division, as part of an agreement with activist investor Nelson Peltz’s Trian Fund Management LP. Ingersoll-Rand PLC (NYSE:IR) also increased its quarterly dividend to 21 cents per share dividend and announced a buyback of $2 billion shares. The security technology unit, which makes mechanical and electronic locks, represents the smallest of Ingersoll-Rand PLC (NYSE:IR)’s business segments, with a revenue of $1.63 billion in 2011. Trian Fund Management LP has 7.3 percent stake in Ingersoll-Rand PLC (NYSE:IR), and Nelson Peltz was named to the board in August.
Intermec Inc. (NYSE:IN)
Information management solutions provider Intermec Inc. (NYSE:IN) is being acquired by Honeywell International Inc. (NYSE:HON) for $600 million in cash or $10 a share. Intermec Inc. (NYSE:IN), which employs close to 2,200 people and operates more than 65 offices globally, said the deal provides the best possible outcome for its shareholders. Intermec Inc. (NYSE:IN) said that in light of the deal, it is suspending the search for a permanent chief executive. Honeywell International Inc. (NYSE:HON) said earnings will rise to $4.78 to $4.99 a share in 2013, excluding the impact of the Intermec Inc. (NYSE:IN) acquisition, from an estimated $4.47 a share this year. Intermec Inc. (NYSE:IN) shares shot up $1.87, or 23.5 percent, to $9.83 in early morning trade.
Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA)
Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA)’s new experimental leukemia drug has seen positive results from a 12-month clinical trial. Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) said the trial eliminated bone marrow cancer in nearly half the patients, who had stopped responding to other drugs. Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) earlier this year presented interim results from the trial of the drug, ponatinib, and the U.S. FDA agreed to an expedited review in October. The federal regulator agency is slated to decide by March 27 whether Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) can start selling the drug in the United States.
Economic Calendar for Monday, December 10, 2012:
11:00 A.M. ET: 4-Week Bill Announcement
11:30 A.M. ET: 3-Month Bill Auction
11:30 A.M. ET: 6-Month Bill Auction
