A Better Beige Book; Japan's Daiichi Swipes Generic Drug Titan; Big Lots "Highly Motivated" to Expand; Corn Hits Another Record; Caterpillar Raises Dividend 17%; Russian Partners to Sue BP; Martha Loses CEO; Office Supply Merger;
- The U.S. Federal Reserve released its Beige Book yesterday (Wednesday), a look at the economic conditions in the central bank's 12 regions. Overall economic activity was slower in April and May. "Three Districts described economic activity as softer, weaker, or lower, with an additional four Districts reporting slower, sluggish, or modest economic growth. The remaining five Districts of Philadelphia, Cleveland, Atlanta, St. Louis, and San Francisco described activity as stable or little changed in recent weeks," the report read. While it is clear the economy is slowing, it has yet to experience a true contraction, clearing the way for the Fed to intensify its focus on inflation rather than recession.
- Japanese drugmaker Daiichi Sankyo Co. said it will buy a controlling stake (50.1%) of India's biggest pharmaceutical company, Ranbaxy Laboratories Ltd., (OTC:RBXLY) for up to $4.6 billion, Bloomberg reported. The addition of the fast-growing generic-brand company reflects the shifting tides in the pharmaceutical industry, as brand-medicine providers are losing considerable market share to generic drug providers.
- As retail sales have soured in the past year, U.S. liquidator retailer Big Lots Inc.'s (BIG) Chief Executive Steve Fishman said the company is "highly motivated" to expand its stores by up to one-third, Reuters reported. The Columbus-based company currently has 1,353 in 47 states, and expansion is contingent on the real estate market cooling down for better location prices, Fishman said.
- U.S. corn futures climbed more than 4% to a record high for the fifth consecutive trading session yesterday (Wednesday) as flooding expanded in the Midwest, the Associated Press reported. July 2009 Corn contracts soared to a record $7.56-1/4, surpassing the record of $7.35 set in during Asian trading hours. By midday, U.S. corn for July 2008 delivery had hit $7.03-1/4 per bushel. Corn prices on the Chicago Board of Trade have surged 80 percent over the past year.
- Caterpillar Inc. (CAT) yesterday (Wednesday) declared a regular cash dividend of 42 cents per share, a 17% increase to its prior payout of 36 cents per share, The Associated Press reported. The dividend is payable Aug. 20 to stockholders of record on July 21.
- Four Russian billionaires who co-own the troubled joint venture TNK-BP will take legal action against their partner BP PLC (BP) in two separate cities - Stockholm and Moscow, Reuters reported. The decision comes in the wake of failed discussions concerning the fate of TNK-BP President Robert Dudley. The Russians said they decided to act after BP failed to agree to a set of specific demands by a Wednesday deadline. One of these was that the venture's American manager should be fired.
- Shares of Martha Stewart Living Omnimedia Inc. (MSO) dropped 6% after President Chief Executive Officer Susan Lyne announced her resignation yesterday (Wednesday). Two high-level executives will replace her, MarketWatch reported. The stock lost 48 cents to close at $7.50.
- Office supply giant Staples Inc. (SPLS) has finally come to an agreement with Corporate Express NV (ADR: CXP) to purchase the Dutch firm for $4.8 billion. Corporate Express Chief Executive Officer Peter Ventress will become president of Staples International, a new position that will oversee Staples' business outside of the United States and Canada. He will report to Ron Sargent, Staples' president and CEO, The East Bay Business Times reported.