Good morning, New York…
FT ALPHAVILLE
Ring around the clearer, acts like a mirror. Default! default! They all fall down: It was only two or three years ago that CCPs were still in the political pixiedust phase. Sprinkle a little on the most hyped up over-the-counter derivatives market and one can be seen to be doing something important. Nevermind that CCPs, acting as counterparties to each side of a given trade, would become the newest Too Big To Fail institutions. Questions around resolution mechanics, should a CCP have a serious wobble, could be sorted out later. Welcome to “later”, Lisa writes.
Dr Copper, ‘telling us the party’s over…’: With the S&P 500 making a fresh run higher, Paul thought it would be rude not to share the latest thoughts of Albert Edwards, SocGen’s Ice Age bear. Rather than gawping stocks, he reckons we should be mindful of the red metal.
NEWS
Three of the eurozone’s five largest economies will bust through EU-mandated deficit limits this year as the bloc’s recession continues to deepen, according to highly anticipated European Commission forecasts published on Friday. In addition to the anticipated breaches by France, Spain and the Netherlands, the currency union’s third-largest economy, Italy, will come within a hair’s breadth of missing the limit of 3 per cent of economic output, with a 2013 deficit forecasted at 2.9 per cent. (Financial Times)
Barack Obama has nominated as commerce secretary Penny Pritzker, the Chicago businesswoman and heiress to the Hyatt hotel empire who helped finance his rise to the White House. The choice of Ms Pritzker was announced as Mr Obama rounded out his second-term cabinet appointments on Thursday before a three-day trip to Mexico and Costa Rica. (Financial Times)
Twitter has fuelled speculation that it is preparing for an initial public offering by naming Cynthia Gaylor, a Morgan Stanley investment banker who has worked on deals for Facebook, LinkedIn and Zynga, as its head of corporate development. (Financial Times)
Intel has promoted 30-year veteran Brian Krzanich to the role of chief executive, as the world’s largest chipmaker by sales navigates a post-PC world dominated by smartphones and other mobile devices. The Silicon Valley company’s chief operating officer will succeed Paul Otellini at this month’s annual meeting, becoming only the sixth person to lead Intel in its 45-year history. (Financial Times)
LinkedIn shares fell more than 10 per cent in after-hours trading after the professional social networking company beat Wall Street expectations on first-quarter profits but issued revenue guidance for the second quarter that was well below analysts’ forecasts. LinkedIn said its growth would be harmed in the second quarter as it adopts a new approach to advertising featuring more self-service tools and mobile products. (Financial Times)
Profits at BNP Paribas dropped 45 per cent in the first three months of the year after investment banking revenues fell sharply. France’s largest bank by assets and revenues reported a net income of €1.58bn in the first quarter, beating the average expectation of €1.53bn in an analyst poll by Thomson Reuters. (Financial Times)
Court hears of ‘sweetheart’ Goldman tax deal: The deal between HM Revenue & Customs and Goldman Sachs was agreed partly to avoid “major embarrassment” to George Osborne, the chancellor, a court heard on Thursday. A legal challenge brought by UK Uncut, the tax campaign group, began scrutinising HMRC and Goldman’s settlement of a lengthy tax dispute. (Financial Times)
Slovenia issued $3.5bn of bonds on Thursday, ameliorating concerns that the small Alpine country will have to be bailed out by the eurozone to pay for its banking sector clean-up. The bond sale was initially delayed after Moody’s downgraded Slovenia’s credit rating by two notches to “junk” on Tuesday, arguing that deteriorating government finances and a wilting banking sector increased the chance of requiring an international rescue. (Financial Times)
Markets: It’s a patchy end to a twitchy week across markets as traders await a crucial guide to the health of the world’s biggest economy, the US jobs report. Worries about global growth linger, but these are counteracted by the assumption that asset prices will continue to gain support from central bank strategies to boost recovery. (FT’s Global Market Overview)
