Tuesday Pre-Market News (12/06/11): S&P Might Downgrade EU

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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:

  • Barclays Equity Mkt Outlook: 2012 S&P 500 price target at 1330 and update our EPS estimates for 2011 to $97 and for 2012 to $103. We still expect 6% earnings growth in 2012 http://bit.ly/sN3dnc
  • S&P Could Downgrade EU Economies: S&P may strip Europe’s biggest economies of their AAA rating (put Germany, France, Finland and 12 other Eurozone nations on watch) http://bloom.bg/vmkeVO
  • Paulson Adds DLPH: On December 2, hedge fund manager John Paulson disclosed a 15.8% stake in the common shares of Delphi Automotive PLC (NYSE:DLPH) http://bit.ly/uRmhOq
  • Lowes Reiterates Guidance: LOW reiterates their guide given on Nov 11th ahead of Day 2 of the Analyst Day, expect more color on LT guide today during presentations
  • Hussman Funds on Recession: John P. Hussman,Ph.D., is out this morning with his weekly market commentary titled, “Have We Avoided a Recession?”.  He makes some very interesting points on the global and US economic activity of the recent weeks http://bit.ly/vfZI2z
  • Barclays Initiation of Software: Barclays initiates on 20 Software names.  CTXS, N, INFA, CRM, and 16 others.  Bottom line—software industry is still young and outgrowing GDP.  Themes to currently play: SaaS, Big Data and the Cloud.  Favorite stocks: CTXS, VMW, CRM and PMTC.
  • Jeremy Grantham’s 3Q Letter: GMO’s Jeremy Grantham is out with his latest piece titled, “The Shortest Quarterly Letter Ever.” His main point in the letter is that there is “No Market for Young Men.”http://bit.ly/ruoLj8
  • Europe Can Get Out of Crisis: China reaffirmed its confidence in Europe’s “wisdom and ability” to resolve the eurozone debt crisis, Vice-Premier Li Keqiang said on Monday while meeting Scottish First Minister Alex Salmond http://bit.ly/vaXPZm
  • Hungry for Yield: “Recent turmoil sent the dividend-bond yield spread back into positive territory, a level not reached since the height of the latest financial crisis (and prior to that, the late 1950s). Analysis screens for co’s whose (synthetic) 5-year debt is yielding less than their expected dividend yield. Long high quality dividend yields, fund position with synthetic bonds” (Citi Research)

M&A Watch:

  • WSJ reports that NFL near deals worth $3.2B/yr for 8-yrs, +60% on current deals w/ Fox (NWSA), NBC (CMCSA) and CBS. Together w/ deals w/ ESPN (DIS) and DTV, the league would be getting $6B in media fees per year
  • FAF filed to withdraw from the process to purchase CLGX
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

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