Infant cured of HIV. A 2 1/2 year-old infant appears to have been cured of HIV following aggressive treatment soon after birth with the drugs lamivudine and zidovudine, which are sold by a joint venture between GlaxoSmithKline (GSK), Pfizer (PFE), ViiV Healthcare and Abbott Laboratories’ (ABT) Kaletra. The news could revolutionize the way babies with HIV are treated. "It’s proof of principle that we can cure HIV infection," says Johns Hopkins’ Deborah Persaud. (Report)
BOJ governor nominee will do whatever it takes to end deflation. Haruhiko Kuroda, the Bank of Japan’s prospective governor, has ratcheted up expectations for the central bank’s first meeting under his leadership on April 3-4, telling a parliamentary hearing that "we will do whatever we can do" to end deflation. Kuroda’s comments helped Japanese shares touch 53-month highs before pulling back and closing at +0.4% to 11652.
Chinese shares tumble on government property action. Chinese shares closed sharply lower, led by real-estate developers, after Beijing intensified its three-year campaign to curb rising prices by ordering larger deposits and a stricter enforcement of sales taxes. The move caught the market unawares, says asset manager Yuming Ying. "Before these policies, the central government released guidelines which were not clear and people thought that the government was losing control over the property market," he says.
Top Stock News
HSBC 2012 pretax profit -6% to $20.6B. HSBC’s (HBC) 2012 pretax profit slipped 6% to $20.6B and came in below consensus, with earnings hurt by $1.9B of fines for breaching U.S. anti-bribery compliance laws and $1.4B for mis-selling financial products in the U.K. Underlying revenues rose 7% to $63.5B, boosted by decent growth at the bank’s Global Banking & Markets and Commercial Banking units. Despite the fall in profit, HSBC increased its 2012 dividends 10% to $0.45 a share, although its stock price still fell 2.7% premarket.
Las Vegas Sands denies breaking bribery law. Las Vegas Sands (LVS) has hit back at reports that it admitted violating the anti-bribery provisions of the Foreign Corrupt Practices Act in an SEC filing on Friday. Instead, LVS said, its audit committee found probable breaches of accounting provisions, which "could range anywhere from a single transaction recorded incorrectly to other errors in the accounting records."
Pratt finds testing fraud at United Tech unit. Pratt & Whitney has disclosed that it discovered a scheme in 2011 at fellow United Technologies (UTX) subsidiary Carmel Forge to allegedly falsify metallurgical test results in certain aircraft engine forgings to make it appear as if they met Pratt’s extra-high internal standards even if they didn’t. While the scheme affected tens of thousands of parts, United Tech and FAA investigations found that the components haven’t posed a safety risk.
Swiss voters OK "anti-fat cat" initiative. As expected, Swiss voters have approved an "anti-fat cat" initiative that allows investors to hold binding votes every year on executive compensation at listed companies, and enable them to block large payouts at the start and end of a manager’s employment. Executives who break the new law could face hefty fines and up to three years in jail. Companies that will be affected include Novartis (NVS), Nestle (NSRGY.PK), UBS (UBS) and Credit Suisse (CS).
Samsung seeks to reduce patent award even further. Samsung plans to "seek further review" of the remaining $598.9M it has to pay Apple (AAPL) in their patent dispute despite Judge Lucy Koh slashing the award by $450.5M from the original $1.05B. "The Court identified an impermissible legal theory on which the jury based its award," Koh said in explaining her decision.
Wal-Mart takes aim at Amazon Marketplace. Wal-Mart (WMT) U.S. CEO Bill Simon is "anxious" to compete with Amazon’s (AMZN) Marketplace for independent merchants, identifying the offering as the tech giant’s "number one weapon." Wal-Mart launched its own Marketplace four years ago but it only has six outside retailers while Amazon’s has 2M. Other players ramping up their efforts include eBay (EBAY) and Google (GOOG).
Top Economic & Other News
Italy could be heading for new election. Another election could be needed in Italy following the impasse that was created in last week’s poll, a top aide to left-of-center Democratic Party leader Pier Luigi Bersani said. The comments came ahead of a meeting of eurozone finance ministers in Brussels today, when the discussion may well include Portugal, Greece – which is losing its developed-market status in Russell Indexes – and Cyprus, as well as Italy.
China set to complete handover of power. China has begun a week and a half of political pageantry that will complete the handover of power to new leadership, with Xi Jinping set to replace Hu Jintao as President and Li Keqiang to take over from Wen Jiabao as Premier. Observers will be watching the extent of any bureaucratic reorganization as an indicator of Beijing’s appetite for reforms, such as with the hugely powerful railways ministry.
China passes U.S. as world’s top oil importer. China has tentatively passed the U.S. as the biggest importer of oil in the world, with EIA data showing that China’s incoming shipments hit 6.12M bpd in December and those of the U.S. fell to 5.98M bpd, the lowest since February 1992. It’s worth pointing out that tax maneuvering may have distorted December data, while U.S. imports tend to recover in January. However, with U.S. production surging, it may not be long before China’s new status is cemented.
Central banks expected to lay groundwork for more easing. It’s set to be a busy week for central banks, with policy committees in the eurozone, Japan, U.K., Australia and Canada due to meet. With economic indicators remaining tepid, if not worse, analysts expect the banks to lay the groundwork for further easing. "If any central banker surprises by being neutral, their currency is going to appreciate," says Citigroup’s Greg Anderson.
In Asia, Japan +0.4% to 11652. Hong Kong -1.5% to 22538. China -3.6% to 2273. India -0.2% to 18878.
In Europe, at midday, London -0.6%. Paris -0.2%. Frankfurt -0.6%.
Futures at 7:00: Dow -0.3%. S&P -0.3%. Nasdaq -0.4%. Crude -0.1% to $90.56. Gold +0.2% to $1575.
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