Today the Spanish government made a formal request for more financial aid for its struggling banking sector. In a letter to Euro group Chairman Jean-Claude Juncker, who is also Luxembourg's prime minister, Spain's Economy Minister Luis de Guindos asked for up to 62 billion euros ($77 billion) in financial assistance for the recapitalization of the Spanish banks that require it.
This move was expected as yields on the Spanish 10-year bonds have been under tight scrutiny as they hover around the alarming 7% line.
Members of Germany, France, Italy and Spain on Friday agreed on a set of growth-enhancing policies equal to about 125 billion euros, or 1% of Eurozone gross domestic product. The European summit takes place later this week and investors are expecting less and less to come from the meeting.
In a bit of good news that doesn't seem to be impacting the sell-ridden market today, new single family home sales grew 7.6% to their highest level in two years. New sales were at a seasonally adjusted 369,000-unit annual rate, almost 20% higher year-over-year, but still a far cry from where sales should be in a healthy economy.
Here are some companies making headlines today.
Chesapeake Energy Corp. (NYSE: CHK) is in the news again and this time for anti-trust violations. Reuters reported today that Chesapeake, led by CEO Aubrey McClendon, conspired with its top competitor Encana Corp. (NYSE: ECA) to suppress land prices. The two companies apparently agreed through numerous emails to avoid bidding against each other at public land auctions to drive land prices for oil and gas fields down.
If these reports are true Chesapeake and Encana violated both federal and state anti-trust laws.
Shares of Chesapeake were down more than 9% by noon and Encana shares were down more than 5%.
Shire PLC (ADR) (Nasdaq: SHPGY), the maker of Adderall XR for attention deficit hyperactivity disorder patients, is suffering its biggest loss in seven years as the U.S. Food and Drug Administration approved a generic version of the drug.
Analysts, led by Brian Bourdot at Barclays Plc, have already cut their earnings forecasts as Adderall is the company's second biggest selling drug.
"We had expected Adderall XR's contribution to decline over time, but generic entry comes two years earlier than we had anticipated," Bourdot and colleagues wrote in a note to clients. They rate the stock equal weight.
Shares of Shire were down more than 10% today as of noon.
Watson Pharmaceuticals (NYSE: WPI) is on the other side of this news as they received permission to produce the generic form of Adderall made by Actavis Group Hf. Watson agreed to buy Actavis in April and the stock rose more than 2% today following the reports.
Overland Storage ( Nasdaq: OVRL) is today's biggest gainer as the San Diego-based data management and protection company announced that reports stating that no infringement occurred on both of Overland's asserted patents are inaccurate.
The International Trade Commission (ITC) released an Initial Determination affirming Overland's asserted patents, but found that European autoloader manufacturer BDT had not violated the Tariff Act of 1930 which governs ITC actions.
Overland Storage's lead counsel said in a press release, "It has been reported that Judge Bullock's Initial Determination found no infringement of both of Overland's asserted patents. Although we cannot yet disclose any of the details of the full Initial Determination, I can tell you that those reports are inaccurate."
Overland plans to continue its lawsuit against BDT both in the ITC and in federal district court. As of noon Overland Storage stock was up over 22% on a day when all the indexes are down. The Dow Jones today was down 176 points, or 1.40% by noon and the S&P 500 was off almost 25 points or 1.88%.
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