Good morning. Here’s what you need to know.
- Markets in Asia were mixed in overnight trading. The Japanese Nikkei advanced 1.7 per cent, but the Shanghai Composite fell 0.1 per cent. European markets are up across the board, with France currently leading the way, up 1.5 per cent. In the United States, futures point to a positive open.
- The EU and Cyprus negotiated a deal at the last minute late Sunday night to bail out the tiny island nation’s struggling banking system. The two largest Cypriot banks will undergo a restructuring in which uninsured depositors will take a hit, but those with less than 100,000 euros in their accounts will be spared from any sort of levy. This time around, the Cypriot parliament doesn’t even have to approve the deal.
- The Austrian Press Agency quoted Austrian finance minister Maria Fekter as saying that Laiki, the second largest bank in Cyprus, would be wound down today as it no longer has any liquidity. Today is a bank holiday, but Fekter said banks could re-open as soon as Tuesday with liquidity support from the ECB.
- In a note published last night, Moody’s analyst Sarah Collins argued that the damage that has been done to the Cypriot economy from the financial crisis of the past week means that even with a completed deal and a “best-case scenario,” Cyprus still remains at risk of default. Collins said this also meant the country’s membership in the euro area going forward would remain an open question.
- The stream of commentary from Wall Street on the Cyprus deal also struck a decidedly negative tone. Société Générale economist Michala Marcussen guarantees a recession, predicting a drop of 20 per cent in real GDP in Cyprus over the next four years. UBS economist Paul Donovan declares “contagion risks are alive and well.” And Citi currency strategist Steven Englander says it’s still bad news for Europe and the euro.
- Carl Icahn and Blackstone are both looking to play spoiler in Michael Dell’s bid to take Dell Inc. private. The two submitted separate preliminary bids late last week, and a special committee on the company’s board is evaluating the proposals to see if either will be better than the $24.4 billion deal put together by Michael Dell and Silver Lake.
- Chinese electric car company BYD – partly owned by Warren Buffett – saw earnings drop 94 per cent in 2012, citing a slowdown in economic growth in China. A subsidiary of Berkshire Hathaway owns a 9.56 per cent stake in the company.
- The Dallas Fed’s monthly survey of regional manufacturing activity is due out at 10:30 AM ET. Economists expect the headline index to rise to 3.7 from last month’s 2.2 reading, indicating an accelerating pace of growth in manufacturing output there. Follow the data LIVE on Business Insider starting at 10 AM ET >
- Federal Reserve Chairman Ben Bernanke will speak at a conference at the London School of Economics this afternoon at 1:15 PM ET. The title of the event is “What should economists and policymakers learn from the financial crisis?” Speaking with Bernanke will be IMF Chief Economist Olivier Blanchard, Harvard professor Larry Summers, former Bundesbank Chairman Axel Weber, and Bank of England Governor Mervyn King.
- Florida Gulf Coast University made history last night in its 81-71 win over San Diego State University, becoming the first 15-seed to ever reach the Sweet 16 round of the NCAA men’s basketball playoff. FGCU knocked off 2-seed Georgetown in the first round on Friday.
- ALSO: Ashley Greene lost one of her two dogs to a fire in her condo on Friday.
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