- Total SA (NYSE ADR: TOT) will pay up to $2.25 billion for a 25% stake in Chesapeake Energy Corp.'s (NYSE: CHK) assets in the Barnett Shale natural gas field in North Texas, Total said yesterday (Monday). Total will pay $800 million for the stake, and up to $1.45 billion for as long as six years by funding 60% of Chesapeake's costs in the field. The Barnett Shale field is the biggest producer of natural gas in the United States and accounted for 52% of Chesapeake's third-quarter output.
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Top AIG Lawyer Quits Over Pay Restrictions, Gets Millions in Severance; Biggs & Faber: S&P 500 Has Room to Run, Dollar Will Rebound; Consumer Confidence Rises for Second Month in a Row; U.S. Home Prices Unchanged in October; China Audit Finds $35 Billion in Fraud by Officials; GM Holds Fire Sale on Remaining Pontiacs and Saturns; Oil Moves Closer to $79
Outgoing American International Group Inc. (NYSE: AIG) General Counsel Anastasia Kelly will get "several million dollars" in severance after she quit over federal pay curbs, people familiar with the matter told The Wall Street Journal . Kelly was entitled to the money under AIG's severance plan, which says certain executives can resign and collect severance if their pay is significantly reduced, the people said. Kelly's pay stood to take a large hit after the Obama administration "pay czar" Ken Feinberg capped annual salaries at $500,000 for executives at companies that received billions in bailout money. The exact amount of severance was not specified.
Hedge fund manager Barton Biggs and contrarian investor Marc Faber both said in an interview with Bloomberg Television that the dollar and the U.S. equity market may gain up to 10% in the next two years. "History would suggest that after such a severe economic shock like we've just had that the odds are that we're going to have a pretty good burst of growth in 2010, 2011," Biggs said. "I don't see any reason why we can't have a further rally in the dollar and a further rally in stocks. And my guess is that the next move in both could be on the order of 10%." Both Biggs and Faber recommended investors buy U.S. stocks on March 9, 2009 when the Standard & Poor's 500 Index was at its lowest point in 12 years.
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Fannie, Freddie Get Blank Checks; Holiday Retail Sales Rise 3.6%; Fed to Banks: Set Up CDs with Us; Health Care Bill Likely to Resemble Senate Version; JPMorgan Sues Former Bank Exec; Oil Tops $79 for First Time in Four Weeks
- In what's been called a "perplexing" move by one analyst, the U.S. Treasury lifted a $200 billion cap on the amount of taxpayer dollars that can be injected into ailing mortgage firms Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) , providing unlimited support to them. The Treasury put into $60 billion into Fannie and $51 billion into Freddie, and were unlikely to need more than the $200 billion cap, wrote Keefe, Bruyette & Woods Inc. analyst Bose George in a note to investors yesterday (Monday). George views the Treasury's move as a way to more aggressively prop the U.S. housing market, and said the government could step up efforts of its Home Affordable Modification Program (HAMP), a mortgage-modification program designed for homeowners who can no longer afford them. But so far, HAMP and other government props have failed to stop a continuing wave of foreclosures, as Money Morning reported last fall. Shares of the firms, both government-sponsored enterprises (GSE) skyrocketed in trading yesterday. Fannie was up 20.95% to close at $1.27, while Freddie gained 26.98% to close at $1.60.
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Nikkei Hits Three-Month High; Obama to Small Banks: Step Up the Lending; Tax Credit Fuels 7.4% Gain in November Home Sales; OPEC Leaves Oil Output Unchanged; WSJ: Apple Approaches CBS, Disney About Internet Television Service; Report: Computer Hackers Stole Millions of Dollars from Citi; Federal Court Upholds Ruling on Patent Infringement by Microsoft; Buffett Adds Comcast COO to Berkshire Board
A weaker yen and strong technology stocks helped Japan's Nikkei 225 finish 1.9% higher at 10,378.03 yesterday (Tuesday), the highest level in three months. Most shares of tech companies gained after Barclays Capital (NYSE ADR: BCS) upgraded its rating on Intel Corp. (Nasdaq: INTC) from overweight to market weight on Monday. "The U.S. dollar strength is undoubtedly helping out the Nikkei," Cameron Peacock, an analyst at IG Markets told MarketWatch.com. "With Japan being such an export-focused economy, the weaker yen is a real positive for Japanese companies' earnings."
The White House will seek to remove bureaucratic barriers that prevent community banks from lending so they can help businesses seize "enormous opportunities" for growth, U.S. President Barack Obama told the heads of a dozen small lenders yesterday (Tuesday). The president encouraged the bankers to keep the nascent recovery of the U.S. economy going by increasing their lending to small businesses and supporting the financial reform measures being proposed on Capitol Hill.
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
GM Hires Former Microsoft CFO; French Drug Maker Buys U.S. OTC Firm; Ford Looks to Reduce Workforce by 41,000; Galleon's Rajaratnam Pleads Innocent; China Backs Out of Investment In U.S. Gold Miner; Gold Falls Amid Interest-Rate Speculation; Recovery Hopes Send Treasury Yield Curve to Record High
- General Motors Co. hired Microsoft Corp. (Nasdaq: MSFT) Chief Financial Officer Chris Liddell to the same position, GM said yesterday (Monday). Liddell replaces Ray Young, who will be transferred to China as the automaker's vice president of international operations. "Chris will lead our financial and accounting operations on a global basis and will report directly to me," said GM Chairman and Interim Chief Executive Officer Ed Whitacre."We're also looking to his experience and insights in corporate strategy as a member of the senior leadership team in helping our restructuring efforts." Liddell, who already announced his Dec. 31 departure from Microsoft, will begin at GM sometime next month.
- French drug maker Sanofi-Aventis SA (NYSE ADR: SNY) has agreed to buy U.S. consumer healthcare group Chattem Inc. (Nasdaq: CHTT) in a deal valued at roughly $1.9 billion in cash, or $93.50 per share, a premium of 34% to Chattem's Friday closing price. The deal should give Sanofi a presence in the over-the-counter U.S. drug market. "It looks for me an interesting deal to generate a lot of synergies," Landesbank Baden- Wü rttemberg analyst Timo Kuerschner, told Reuters.
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Investment News Briefs
Senate Approves Bernanke Nomination; Commodities, Markets Fall as Dollar Gains; Citi Shares Fall After Lower-Than-Expected Price for Stock Sale; Weekly Jobless Claims Rise; Whitney Reduces EPS Estimates for Goldman, Morgan Stanley; Report: AIG Asian Subsidiary to Have Hong Kong IPO; RIM Beats Estimates on BlackBerry Shipments; Palm Q2 EPS Misses Wall Street Expectations
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Sovereign Fund Attempts to End $7.5 Billion Citi Share Purchase; Credit Suisse to Pay U.S. $536 Million Penalty; Cohen: U.S. Economy to Slow in 2010; Roy Disney Dead at 79; Former TPG, Lazard Employees Sued by SEC for Insider Trading; Galleon Group Founder Indictment Alleges Fraud, Conspiracy; Comcast Launches Online TV Service
- The Abu Dhabi Investment Authority (ADIA) is trying to call off a deal it made to buy $7.5 billion of Citigroup Inc. (NYSE: C) stock at eight times yesterday's (Wednesday) price, saying Citi misled it about the investment, Bloomberg News reported. The sovereign fund alleged "fraudulent misrepresentations" and seeks more than $4 billion in damages if the deal is upheld, ADIA said in an arbitration claim. Citi calls ADIA's claims "entirely without merit."
- Switzerland's Credit Suisse Group AG (NYSE ADR: CS) will pay the U.S. government $536 million for conducting business with Iran and other sanctioned countries, prosecutors said yesterday (Wednesday). The bank moved more than $1.6 billion through the U.S. financial system on behalf of Iran, Sudan, Myanmar, Cuba and Libya, documents filed in federal court and obtained by Reuters showed.
- U.S. housing starts rebounded sharply, rising 8.9% to a seasonally adjusted 574,000 units on an annualized basis in November, the Commerce Department said. Economists polled by MarketWatch.com were expecting a pace of 563,000. "We now expect both starts and permits to rally significantly further over the next few months, though the big test for the market will come in the spring," said Ian Shepherdson, chief U.S. economist at High Frequency Economics Ltd.
