TODAYS PRIMER
Peter Schacknow, Senior Producer, CNBC Breaking News Desk
Wall Street will have an abbreviated trading session ahead of tomorrow’s July 4th holiday, with the closing bell set to ring three hours early at 1 p.m. New York time. Though Monday’s mixed session would ordinarily be nothing to write home about, the selloff that many had anticipated following Friday’s rally did not occur. The Nasdaq Composite’s two-day gain of 3.6 percent is its best such performance in seven months.
U.S. automakers will be out with June sales figures throughout the morning, with overall sales expected to be up by nearly 21 percent over a year ago. We’ll also get May factory orders from the government at 10 a.m. New York time, with economists expecting a 0.1 percent rise following an April drop of 0.6 percent.
There are no corporate earnings set for release today, and very few for the rest of this holiday-shortened trading week.
Barclays (BCS) is our lead stock to watch this morning, with CEO Bob Diamond quitting in the wake of the Libor manipulation scandal that saw the bank fined more than $450 million by U.S. and U.K. regulators. That comes a day after chairman Marcus Agius stepped down from his position.
Microsoft (MSFT) will take a $6.2 billion non-cash charge to write down goodwill in its online services division. Most of that writedown is related to its 2007 purchase of aQuantive, an online ad agency, for $6.3 billion. Such writedowns are required by accounting rules if the value of an investment or an acquisition has diminished.
Chesapeake Energy (CHK) is in the news for multiple reasons: Investor Carl Icahn told CNBC’s Fast Money that the company is a “very undervalued asset” and that he wouldn’t sell his shares now.
Separately, Reuters is reporting that Chesapeake, along with Canada’s Encana, (ECA), are the targets of a Justice Department probe involving possible bidding collusion between the two in Michigan land deals two years ago.
Forest Labs (FRX) has responded to a letter sent by Icahn to the company yesterday, which accused the board of putting chairman/CEO Howard Solomon’s interests ahead of shareholders. The drugmaker says it is “not surprised by Mr. Icahn’s theatrical display of self-serving rhetoric”.
Apple (AAPL) won another interim victory in its ongoing legal battle with Samsung, with a judge rejecting a Samsung request to lift a ban on U.S. sales of its Galaxy Tab 10.1. A patent trial involving the two is set to begin July 30.
General Motors (GM) and Facebook (FB) are said to be in talks to return GM to Facebook as a paid advertiser, according to the Wall Street Journal. That comes a few months after a GM executive said Facebook ads had little impact and that GM would stop advertising on the social networking site.
The Journal also reports that Navistar (NAV) will announce it’s backing away from pollution reduction technology that has hurt its sales and caused conflict with federal regulators.
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