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Good morning. Here’s what you need to know.
- Everyone’s getting slammed: Asian indices were down in overnight trading with the Shanghai Composite down 2.9%. Major European indices are in the red and U.S. stocks are down.
- S&P has revised downward Italy’s credit rating outlook to ‘negative’ from ‘stable’ over concerns of a political stalemate that could affect the country’s austerity plans. The government meanwhile has dismissed the report. Italy’s FTSE MIB index has fallen nearly 3% on S&P’s warning. Check out the 15 countries most buried in debt >
- Preliminary data released by HSBC showed that Chinese manufacturing fell to a 10-month low in May. Chinese stocks slid after HSBC’s preliminary purchasing managers’ index fell to 51.1 in May, from April’s reading of 51.8. A reading below 50 shows contraction.
- Spain’s ruling Socialist party got pummelled across the country in municipal elections. Voters showed their unhappiness with high unemployment rates and the government’s budget cuts. Prime Minister Jose Luis Rodriguez Zapatero said he planned to stay to the end of his term in March 2012. Now here are photos and videos from the protests in Spain >
- German Chancellor Angela Merkel’s CDU took another battering at local elections on Sunday sliding to third place. A coalition of Social Democrats and Greens won at the Bremen ballot. Don’t miss: A complete overview of the debt situation in Europe >
- Global markets are seeing a huge sell-off on Monday after a week of turmoil on Wall Street uncertainty in Europe. The Nikkei fell 1.52%. In Europe Italy fell 2.7%, Germany is down 1.86% while France is down 1.75%. UK’s FTSE 100 slid 1.6%, while Spain and Greece fell under 1.4%. Here is Whitney Tilson’s presentation on our period of unusual uncertainty >
- Sony Corp. has said it expects to post a huge net loss after a tax charge of $4.4 billion. The company announced that it expects a $3.18 billion net loss for the year ending March 31. Sony has also taken a hit in recent months after Japan’s earthquake and tsunami and a series of hacker attacks this year.
- China Development Bank’s investment unit has purchased a stake in U.S. private equity firm TPG Capital. China has been ramping up efforts to develop its private equity industry as firms are raising funds for local investments.
- Private-equity firm Kohlberg Kravis Roberts & Co L.P. is expected to announce today that it has acquired Ipreo Holdings LLC, a provider of capital-markets data to banks and financial institutions. KKR & Co. L.P. is expected to pay $425 million in cash.
- Three people have been reported dead after an explosion at Foxconn Technology Group’s plant in southwest China. The company assembles Apple products, including the iPhone 4 and iPad 2. Click here for a full guide to the bubble in China >
- BONUS – Katy Perry’s romantic reunion with her husband Russell Brand was cut short after he was deported from Japan.