Good morning. Here’s what you need to know.
- Asian indices were up in overnight trading with the Hang Seng up 2.08%. European stocks are up, but a bit less so, while US markets have opened negative.
- European leaders announced a €109 billion Greek bail-out, with a ‘selective default’. Under the deal private bondholders would be expected to contribute €37 billion. Sarkozy also spoke about the establishment of the European Monetary Fund. Click here for a guide to who would get slammed if Greece defaults >
- European markets are rallying after leaders approved the Greek bail-out. France is up nearly 1% on the news and Germany is up over 0.5%. Meanwhile yields on two-year Greek debt dropped to about 26% today from just under 34% yesterday.
- Ratings agency Fitch has said it will declare Greece to be in ‘restricted default’ on its debt, because of the conditions of the new bailout. It however said it will assign new ratings of a ‘low speculative grade’ only after its bond exchange is completed. Click here to see the 20 banks praying for the bailout to work >
- Some good economic data for debt ridden eurozone. Industrial orders for May came in at 3.6% beating expectations of a 0.8% rise.
- General Electric posted Q2 operating earnings of $0.35 a share, on revenue of $35.6 billion, beating estimates. The company reported that it is optimistic on the second half of the year and beyond.
- As the August 2 debt ceiling deadline looms, President Barack Obama and Speaker of the House John Boehner are said to be near reaching a $3 trillion deficit reduction deal that includes limited, if any, revenue increases. President Obama now needs to convince Democrats to agree to the deal. Click here to see 14 scary facts about the national debt >
- Access Industries, Sony Music Entertainment and Vivendi SA are all interested in buying all or parts of EMI Group Ltd. for anywhere between $2.5 billion – $4 billion, according to analyst estimates. Citigroup took control of EMI this year after British financier Guy Hands’ Terra Firma defaulted on a loan.
- In more earnings news, Xerox Corp. posted Q2 GAAP earnings of $0.22 per share on revenue of $5.6 billion. The company raised its full-year 2011 GAAP earnings expectations to $0.91 – $0.96 per share. Meanwhile, Schlumberger Ltd reported 64% jump in second quarter profits, posting earnings of $0.98 a share on revenue of $9.62 billion.
- A UK MP has written to the board of News Corp, calling for Rupert Murdoch and James Murdoch to be suspended over the phone hacking scandal that has plagued the company. Meanwhile, two News of the World executives have challenged James Murdoch’s testimony before the UK parliament.
- BONUS – Penelope Cruz was spotted filming a Woody Allen movie in Rome.