Japan signals easing intent with BOJ picks. Japanese Prime Minister Shinzo Abe has nominated Asian Development Bank President and uber dove Haruhiko Kuroda as the next Governor of the Bank of Japan. Abe also picked academic Kikuo Iwata, who backs unconventional monetary policy, and BOJ official Hiroshi Nakaso as deputy governors. The nomination of Kuroda, who reckons Japan can hit its 2% inflation target within two years, helped Tokyo stocks to rise sharply even though it was widely expected.
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J.C. Penney sinks after disastrous Q4. J.C. Penney’s (JCP) shares were -14% premarket after the retailer announced Q4 results that badly missed expectations. JCP’s net losses widened almost six-fold to $552M, losses per share were $0.24 and revenue slumped 28.4% to $3.8B, while the company gave no guidance. Internet sales, which really should be a bright spot, plummeted 34%. CEO Ron Johnson admitted to "big mistakes" in his attempts to turn JCP around.
RBS 2012 net loss almost triples to £5.97B; to float Citizens. RBS’s (RBS) 2012 net loss widened £5.97B from £2B in 2011, while revenue slipped 6.3% to £25.79B. The loss was due to a £4.6B accounting charge for changes in the value of RBS’s own credit, a $1.1B charge for the mis-selling of products, and £381M for the bank’s Libor fine. As expected, RBS unveiled plans to partially float its Citizens U.S. unit in two years and to scale down its investment bank. Shares were -3.85% premarket.
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Wal-Mart’s shelf-stocking problems deteriorating. Wal-Mart’s (WMT) long-running inventory problems are "getting worse", U.S. CEO Bill Simon has reportedly told an internal meeting. "We run out quickly and the new stuff doesn’t come in," said Simon, who’s appointed a VP to solve the issue. A Wal-Mart spokesman downplayed Simon’s comments, although Californian department manager Evelin Cruz described them "as dead on."
Groupon shares crater as losses widen. Groupon’s (GRPN) shares plunged 27% premarket following its Q4 earnings yesterday, with losses per share of $0.12 missing by $0.15 even though revenues climbed 30% to $638.3M and were in line. The company’s net loss widened 24% to $81.1M, while it also provided a Q1 sales outlook that was below consensus. The results, which were harmed by Groupon taking a smaller revenue cut and weakness abroad, could prompt renewed calls for the replacement of CEO Andrew Mason.
Renewal of 787 flights remains a dream. Federal Aviation Administrator Michael Huerta has indicated it will be a while before Boeing’s (BA) 787 can return to the air, saying that although the company’s proposed modifications to the plane’s lithium-ion batteries are comprehensive, they’ll require extensive testing and analysis. Earlier today, Boeing presented its plan to Japanese regulators, saying it’s a permanent rather than an interim solution.
GM plan to close German factory gets union acquiescence. GM (GM) has received agreement from Opel’s union to close an aging vehicle factory in Bochum in Germany; GM Vice Chairman Steve Girsky told labor representatives that they would have to sign off on a deal to overhaul Opel’s German operations by today. GM said in December that it intends to end car production at the plant by 2016, and union acquiescence should help the company avoid industrial unrest.
Caterpillar to cut headcount at Belgian plant. Caterpillar (CAT) intends to cut 1,400 out of 3,700 jobs at its Gosselies factory near Charleroi in Belgium. Caterpillar produces hydraulic excavators, loading vehicles and engine parts at the plant.
Shell abandons Arctic drilling plans for 2013. As expected, Shell (RDS.A) has abandoned plans to drill for oil in Alaska’s Arctic waters this year. The decision comes after Shell said it will send its two Arctic offshore rigs to Asia for repairs and upgrades following a series of mishaps, including the grounding of the Kulluk drillship in a storm.
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Eurozone inflation falls towards ECB target. Eurozone CPI dropped to an expected 2% on year in January from 2.2% in December, with inflation now close to the ECB’s target. The decline adds weight to a forecast from Mario Draghi yesterday that CPI will fall to significantly below 2%. He also said the ECB is "far" away from tightening its monetary policy, although a couple of other policy makers were rather more hawkish in remarks they made.
Senate confirms Jacob Lew as Treasury Secretary. The Senate yesterday confirmed Jacob Lew as Treasury Secretary with a vote of 71-26. Lew faces a tough first few months: $85B of automatic spending cuts are due to take effect tomorrow, and then on March 27, a funding measure for U.S. agencies expires. Less than two months after that, the temporary suspension of the government’s borrowing limit is set to end.
In Asia, Japan +2.7% to 11559. Hong Kong +2% to 23020. China +2.3% to 2366. India -1.5% to 18862.
In Europe, at midday, London +0.4%. Paris +0.4%. Frankfurt +0.7%.
Futures at 7:00: Dow +0.1%. S&P +0.2%. Nasdaq +0.2%. Crude -0.1% to $92.67. Gold -0.4% to $1589.80.
Today’s economic calendar:
8:30 Initial Jobless Claims
8:30 GDP Q4
9:45 Bloomberg Consumer Comfort Index
9:45 Chicago PMI
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
12:30 PM Sarah Bloom Raskin: ‘Financial Institutions and Reputational Risk’
3:00 PM USDA Ag. Prices
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
4:30 PM Fed’s Fisher: Economic Outlook
8:00 PM Fed’s Evans: Monetary Policy
Notable earnings before today’s open: AIXG, AWR, BDBD, BKS, BRLI, BRY, CHS, CTRX, CVC, DANG, DPZ, GMXR, GTLS, HK, IRDM, IRM, ISIS, KSS, LKQ, MCGC, MTG, NIHD, OCN, PKT, RDC, RNO, SDRL, SHLD, TD, TTI, VRX, WNR, WPX, WWE
Notable earnings after today’s close: AIRM, AL, ALSK, BID, CLNE, CPNO, CRM, DECK, DRH, ENDP, GPS, GXP, HTGC, JOE, KOG, KYAK, MCP, MDR, MDVN, MENT, MTZ, MXWL, NGD, NOG, OPTR, OVTI, PANW, RNDY, RST, SD, SLXP, SONS, SPLK, SSRI, TEG, TESO, UHS, WR, XTEX, YOKU
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