Good morning. Here’s what you need to know.
- Concerns over Greece hit markets hard, Asian markets plummeted in overnight trading with the Hang Seng off 4.21%. Europe is lower and U.S. futures opened sharply lower. Even gold is seeing a sell-off today.
- Greek officials have said that the country only has cash to operate until October and Germany appears to be preparing for a Greek default. Yields on two-year Greek notes exploded over 60% for the first time. Prime minister George Papandreou however gave a speech on reforms and said Greece was determined to stay in the Eurozone and avoid default. Now here is a quick guide to who gets crushed if Greece defaults >
- Austerity cuts and weak global demand hurt Italian industrial production. Output fell 0.7% month-over-month in July, after a 0.8% fall the previous month. A €54 billion austerity plan passed to appease the European Central Bank is likely to further weaken industrial production. Here is the sad story of how Italy got to be such a wreck >
- European banks have taken a major hit from investor concerns over Greece’s sovereign debt. France is off over 4% again dragged down by financials, with Societe Generale off 8.37%, BNP Paribas down 13.56% and Natixis down about 6%. Soceiete Generale said it would cut costs and sell assets worth €4 billion to boost its capital holdings. Check out the 16 strongest banks in the world >
- The McGraw Hill Companies has announced that it is splitting into 2 public companies, McGraw Hill Markets, which will focus on capital and commodities markets, and McGraw Hill Education. It is also accelerating the pace of its share repurchases to $1 billion.
- In M&A news, Broadcom Corporation is buying NetLogic Microsystems for $3.7 billion and NetLogic’s shareholders are expected to receive $50 per share. Meanwhile, American Colfax Corporation is buying British Charter International for $2.4 billion in cash and shares, after beating out rival bidder Melrose.
- One of the most controversial companies around right now, Bank of America, is presenting at an investor conference in New York today. People will be listening for commentary on layoffs, the state of its legal woes, and of course the economy.
- President Obama is sending his $447 billion jobs plan to Congress today and is expected to reveal how he will be funding the plan. Meanwhile, Republican candidates will meet for another presidential debate in Tampa today.
- Over the weekend China posted a narrower than expected trade surplus of $17.7 billion. Exports grew 24.5% year-over-year in August, from 20.4% the previous month, while imports jumped 30.9% year-over-year in August, from 22.9% in July.
- Meanwhile demand for Italian debt weakened over concerns over the crisis in Europe. Italy sold €11.5 billion of treasury bills, and borrowing costs rose with yields on one-year notes surging to 4.153% up from 2.959%. Check out the eerie similarities between Italy and Greece >
- BONUS – Jennifer Lopez was spotted on a dinner date with Bradley Cooper in New York.
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