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Financial news today, May 6, 2014: U.S. futures were on the rise Tuesday morning on mixed global results and positive forecasts for the national economy. The Organization for Economic Cooperation and Development said it expects U.S. economic growth to rebound strongly in Q2 2014 after the brutal winter weather. The agency also expects inflation to remain in check until mid-2015.
Here's what you need to know to make your Tuesday profitable.
Five Biggest Stories in Today's Stock Market, May 6, 2014:
- Too Big to Jail: The U.S. Justice Department and Attorney General Eric Holder announced that no Wall Street bank is "Too Big to Jail." Federal prosecutors are very close to securing a guilty plea and a $1 billion fine from Credit Suisse Group AG (NYSE: CS) over allegations that the bank helped wealthy Americans evade income taxes. Allegedly, Credit Suisse established a branch in the Zurich International Airport to facilitate tax evasion and failed to report any transactions to the U.S. government. The Justice Department expects a plea in the next few days.
- Here We Go Again: David Einhorn of Greenlight Capital spoke to investors at the Ira Sohn conference yesterday and took direct aim at Athenahealth Inc. (Nasdaq: ATHN), a self-proclaimed cloud-computing company in the health sector. Shares of the company slipped by 12.5% after the hedge fund manager said the stock is "caught up in a bubble." Einhorn, who was profiled in Michael Lewis' "The Big Short," expects shares of the stock to fall by as much as 80% or more.
- Merger Mania: This morning, Merck & Company Inc. (NYSE: MRK) announced plans to sell its consumer care business to Germany's Bayer AG (OTC: BAYRY). The expected $14.2 billion deal would close later this year. Merck expects to see between $8 billion to $9 billion in after-tax money from the deal, and Bayer will firmly secure its position as a global leader in the over-the-counter health products market.
- What Did You Expect: He hates "the rich," but he owns three homes. That's the mentality of French President Francois Hollande. So it wasn't surprising that he took to the nation's national radio station on Tuesday and announced that he disapproved of General Electric's (NYSE: GE) $16.9 billion bid for Alstrom's energy business. Hollande called the deal "unacceptable" and now will look for other offers to meet the government's expectations. Said Hollande: "We want the offers to be improved on jobs."
- Dollar Sinks Against Pound: According to FactSet Research, the British pound struck a level against the dollar that hasn't been reached since 2009 on news that the U.K. service sector is on the rise.
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Full U.S. Economic Calendar May 6, 2014 (NYSE: all times EDT)
- ICSC-Goldman Store Sales at 7:45 a.m.
- Gallup US ECI at 8:30 a.m.
- International Trade at 8:30 a.m.
- Redbook 8:55 a.m.
- 4-Week Bill Auction at 11:30 a.m.
- 3-Yr Note Auction at 1:00 p.m.
- Treasury STRIPS at 3:00 p.m.
- Jeremy Stein speaks at 6:15 p.m.
Key Companies Reporting Earnings May 6, 2014
- Consensus earnings per share for HCP Inc. (NYSE: HCP) is $0.74.
- Consensus earnings per share for NU Skin Enterprises Inc. (NYSE: NUS) is $0.94
- Consensus earnings per share for Office Depot Inc. (NYSE: ODP) is $0.03.
- Consensus earnings per share for Magellan Midstream Partners L.P. (NYSE: MMP) is $0.68.
- Consensus earnings per share for Emerson Electric Co. (NYSE: EMR) is $0.82.
- Consensus earnings per share for DIRECTV (NYSE: DTV) is $1.49.
- Consensus earnings per share for FirstEnergy Corp. (NYSE: FE) is $0.41.
- Consensus earnings per share for AMTEK Inc. (NYSE: AME) is $0.56.
- Consensus earnings per share for Discovery Communications Inc. (Nasdaq: DISCA) is $0.71.
- Consensus earnings per share for NRG Energy Inc. (NYSE: NRG) is $-0.12.
- Consensus earnings per share for HollyFrontier Corp. (NYSE: HFC) is $0.77.
- Consensus earnings per share for Henry Schein Inc. (Nasdaq: HSIC) is $1.13.
- Consensus earnings per share for BCE Inc. (NYSE: BCE) is $0.71.
- Consensus earnings per share for Zoetis Inc. (NYSE: ZTS) is $0.37.
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.