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U.S. Stock Futures Retreat on Banking Concern; Sun Tumbles
U.S. Bancorp (NYSE:USB) and SunTrust Banks Inc. (NYSE:STI) slid more than 4.4 percent after Calyon Securities’ Mayo said new government actions to shore up the financial system may not help as much as expected. Sun Microsystems (NASDAQ:JAVA) sank 22 percent as people familiar with the matter said negotiations with IBM (NYSE:IBM) have fallen apart. European equities and crude oil erased gains.
HSBC raises almost $18 billion in rights offering
HSBC Holdings Plc. (NYSE:HBC) said Sunday it raised 12.5 billion pounds ($17.7 billion) in its recent stock rights offering, net of expenses, in a move expected to boost the international banking giant’s capital levels and possibly even fund new acquisitions.
AIG’s CDS Hoard: The Great Unraveling
The white-hot furor over AIG’s (NYSE:AIG) retention bonuses seems to have died down a bit. Last week the House of Representatives passed a watered-down version of the bill that was supposed to tax those payments out of existence. But AIG isn’t leaving the bull’s-eye anytime soon. The Government Accountability Office said on Mar. 31 that AIG should demand concessions from its trading partners and employees.
Citi Appoints Mike Corbat CEO of Citi Holdings
Citigroup Inc. (NYSE:C) named Mike Corbat the permanent chief executive of Citi Holdings, one of the two divisions the struggling banking giant has split its operations into as it looks to make a turnaround. Citigroup’s shares were recently down 1.4% at $2.81. The stock has more than doubled in the last month but has still lost 58% of its value so far this year.
IBM Talks Teeter as Sun Board Splits
Talks between International Business Machines Corp. (NYSE:IBM) and Sun Microsystems Inc. (NASDAQ:JAVA) were on the verge of unraveling Sunday, threatening a potential $7 billion acquisition that would place one of Silicon Valley’s iconic companies under the Big Blue umbrella.
Aerospace Industry Faces Pressure Over Transparency
Northrop Grumman Corp.’s (NYSE:NOC) $325-million settlement last week resolving claims over defective satellite parts has ratcheted up pressure on the U.S. aerospace industry to become more transparent about performance on government space contracts. The long-running Northrop case previously prompted the Air Force and Aerospace Corp., its main outside adviser on space projects, to revamp nondisclosure rules covering certain proprietary data gathered from contractors, according to people familiar with the details.
Gold Drops to 10-Week Low in London as Haven Demand Declines
Gold dropped to a 10-week low in London on speculation the world financial crisis may be easing, reducing the precious metal’s appeal as a haven. Silver fell. Bullion has tumbled 5 percent in three days, wiping out this year’s gains, on expectations government efforts will revive the global economy.
A Boom for Tax Prep
New tax breaks will drive fresh customers to H&R Block (NYSE:HRB), Liberty Tax, and others. But the IRS fears increased fraud in the unregulated industry. The good news for tax preparers could turn into bad news for the IRS, however, as well as an early illustration of what might be many unintended consequences stemming from the stimulus.
AT&T workers to stay on job after contract expires
AT&T Inc.’s (NYSE:T) landline employees will continue to report for work after their contract expired at midnight Saturday, according to a statement Sunday by the union that represents nearly 100,000 of the company’s workers. “For now, employees will continue to report to work, although that can change at any time. Workers are keeping their option to strike open,” the Communications Workers of America said.
MGM Mirage Weighs Sale of Detroit, Gulf Casinos
MGM Mirage (NYSE:MGM) has hired Morgan Stanley (NYSE:MS) to handle the potential sales of two of its steadiest cash cows, MGM Grand Detroit and the Beau Rivage casino in Biloxi, Miss., according to people with knowledge of the matter. MGM Mirage, based in Las Vegas, is under intense pressure to raise cash to meet looming obligations on its $13.5 billion in debt as well as salvage City Center, the troubled $8.6 billion Las Vegas development owned by MGM Mirage and Dubai World that still needs billions in funding.
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