Every morning the Street of Walls team puts out an update on market levels, today’s top stories, and active M&A deals.
Today’s Top Stories:
- Tilson’s Recommended Readings: For anyone looking to break into the hedge fund industry, here is a good resource for MUST-READS for any to-be hedge fund analysthttp://bit.ly/vUqV8c
- EU P/E Multiples Lowest Since 1980s: expect stocks to go higher about 10-15% given that equity risk premium priced into market is near 2009 peak and P/E valuations near their lowest levels since the 1980?shttp://bit.ly/tV5RBD
- Italy is Insolvent: The International Monetary Fund may be forced to classify Italy as insolvent during the first half of 2012… IMF economists described a debt-to-GDP ratio of 120 percent as “the maximum level considered sustainable for a market access country” (BBG)
- Corporate Credit: CDX.IG, HY and LCDX tightened -5.5bp, -45bp (+$1.5) and -22bp (+$0.75) yesterday. Closing marks were 127bp, 723bp ($91.75) and 441bp ($92.75)
- Investors Leave Stocks & Go To Bonds: Worldwide, investors have taken $34 billion out of equity funds this year and put $75 billion into bonds http://bit.ly/tPUbAL
- Strong Holiday Sales: ace of holiday sales seems pretty decent as evidenced by updates from ShopperTrak (raised its sales forecast from +3% to +3.7) http://bit.ly/trH0mW
- BAC’s Mortgage Problems: is close to settling a U.S. Justice Department investigation into whether its mortgage lender unit Countrywide Financial violated fair-lending practices (Dow Jones)
- Earnings this AM: NKE +3% great quarter, WAG -3% misses top and bottom line, TEVA +0.5% announces $3B sh buyback, ORCL -10% big miss across almost all segments, JBL -7% in-line EPS but revs and guidance light
Economic Calendar:
- Wednesday: Existing Home Sales
- Thursday: Chicago Fed Survey, GDP, Personal Consumption, Initial Jobless Claims, U. of Mich Confidence, Leading Indicators, House Price Index
- Friday: Durable Goods Orders, Personal Income, New Home Sales
M&A Watch:
- Weekly M&A Trends: Announced M&A volumes improved by 55.1% to $50.2 billion. 4Q11 volumes are averaging 9% below the 3Q11 average weekly volume http://bit.ly/shSgxN
- DFG getting bought by Tokio Marine in cash deal = $2.7B