Here’s what you need to know this morning:
- China has increased the reserve requirements for its banks by 50bps, in an effort to quell rapid growth and speculation in the country. Asian stocks have tumbled on the news. For background on the China bubble see here.
- Continental (CAL) and United Airlines (UAL) have officially merged creating the largest carrier in the world. The company is to be valued at $6.8 billion at the time of merger, though unions and the U.S. government must still approve the deal.
- Norsk Hydro is set to buy the Brazilian aluminium manufacturing business of Vale for $4.9 billion in a stock and cash agreement. The deal is seen by Norsk Hydro as a long term play on the aluminium market, with an impact that will be felt for 100 years.
- Mining stocks are experiencing downward pressure this morning, as the Australian government announced a 40% tax on industry gains for the purpose of funding its beleaguered medical system. BHP and Rio Tinto have been some of the hardest hit by the announcement.
- As more details of the EU-IMF support measures for Greece come to light, it has been revealed that Greek sovereign debt will be accepted as full collateral for loans, taking the stress off both the sovereign and banks holding Greek debt.
- Private equity firms Warburg Pincus and Silverlake Partners are set to announce the buyout of Interactive Data Corp, or IDC, from its parent company Pearson. The deal is valued at $3.1 billion and would see Pearson give up its 61% stake in the firm.
- Goldman Sachs is planning on changing the way it conducts business with institutional clients in an effort to preemptively deal with the SEC’s charges against the firm. New rules would require Goldman to confirm with clients their understanding of the risks involved in their purchases.
- It has emerged that BP, the company at the centre of the Louisiana oil spill storm, will only be on the line for $75 million of any lawsuits involved with the spill. This is because the U.S. government set up a fund to pay out in the event of such a spill in the 1980s, protecting corporations. See amazing pictures of the explosion here >
- The cost of cleanup for the BP (BP) oil spill is now being estimated at $14 billion. Both BP and the other investor in the well, Anadarko Petroleum, have seen their share prices drop as a result of the rising costs and negative headlines.
- The manhunt for the would be Times Square bomber continues with some security footage pointing towards a single suspect in the case. The bomb, which failed to detonate Saturday evening due to faulty construction, has been claimed by the Pakistani Taliban.
- Bonus: Jessica Simpson attended this weekend’s White House Correspondent’s dinner, and made hints she might have a new boyfriend. No word yet in whether or not another MTV series is on the way featuring their exploits.
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