Economy
Hours after Kiev granted "special status" to eastern regions of the country and granted them limited self rule, Ukraine and the EU ratified their long awaited association and free trade agreement, which sparked the Ukrainian revolution last February. Following the signing, President Poroshenko announced that by ratifying the agreement, the country had set course for its membership into the EU. However, Ukraine postponed the deal's implementation until December 2015, facing immense pressure from Russia.
According to new figures from the Census Bureau, inflation-adjusted income for the median U.S. household rose by just 0.3% in 2013, no higher than a quarter of a century ago. This translates into the median household edging up just $180 last year to $51,939, highlighting another year of stagnant incomes. The poverty rate fell from 15% to 14.5%, the first decrease since 2006, but it is still two percentage points higher than it was before the recession.
Stocks
Sony is warning of a ¥230B ($2.2B) net loss for its current fiscal year, compared with its previous forecast for a ¥50B loss, after being hit with a ¥180B ($1.7B) impairment charge in its mobile communications segment. In addition, the Japanese electronics maker says it will also not pay a dividend this business year. The announcement marks the sixth downward revision under Sony (NYSE:SNE) CEO Kazuo Hirai, who promised to revive the firm's troubled electronics division when appointed to the post in 2012.
New York Attorney General Eric Schneiderman has defended his position over the Barclays (NYSE:BCS) dark pool lawsuit, calling the bank's motion to dismiss the case "misguided." Schneiderman reasserted allegations that Barclays misled customers by favoring its own dark pool when routing client orders and chose high frequency traders over other investors. The bank will have until Oct. 12 to respond, after which the case will go to trial if a settlement isn't reached.
Credit Suisse has received a letter from the U.S. Fed asking the bank to immediately address the issues with its underwriting and sale of leveraged loans. The bank already received warnings last year regarding its involvement with the risky deals, which carry too much debt or offer too few protections for lenders. The new letter raises concerns over Credit Suisse's (NYSE:CS) practices and suggests that regulators continue to be concerned with the bank's lending activities.
A top AT&T executive says the company is open to acquisitions in Mexico, where America Movil (NYSE:AMX) has said it would sell off parts of operations to cut its market share to avoid a regulatory crackdown, WSJ reports. AT&T's (NYSE:T) attention is focused on closing the $49B deal for DirecTV (NASDAQ:DTV), but Chief Strategy Officer John Stankey says Mexico is a fast-growing market of interest to the company, and that AT&T has the wherewithal to do other deals if opportunities arise.
Microsoft says it is raising its quarterly dividend by 11% to $0.31/share and has appointed two new directors to replace two board members who decided not to seek re-election. The latest changes bring in Kraft Foods (NASDAQ:KRFT) CFO Teri List-Stoll and Visa (NYSE:V) CEO Charles Scharf to Microsoft (NASDAQ:MSFT), effective Oct. 1.
Alibaba options are expected to be listed on the CBOE (NASDAQ:CBOE) and the International Securities Exchange starting from Sept. 29. Contract specifications for Alibaba options will be determined when the new listing is certified by the Options Clearing Corporation prior to trading. Alibaba (Pending:BABA) stock is scheduled to begin trading on the NYSE this Friday.
Activist investor Trian Fund Management is seeking public support to force DuPont (NYSE:DD) to break itself up, after more than a year of unsuccessful private efforts. Trian says Dupont's overly complex corporate structure is a large weight for the company's seven business lines, and makes it difficult for investors and the company to assess their prospects. As it launches its new campaign, Trian says its plan would cut annual costs by $2B-$4B.
The new head at Cadillac is planning the luxury car leader's revival, following a 4.7% sales slump this year through the end of August. Johan de Nysschen, who joined GM (NYSE:GM) this month from Nissan's (OTCPK:NSANY) Infiniti, is preparing a multi-pronged strategy, including cutting back on production, decreasing dealership count and expanding its portfolio to include more utility vehicles. De Nysschen is also considering a "halo car" to boost the brand's image.
Sky Deutschland's supervisory and executive boards have advised shareholders against a takeover offer by British Sky Broadcasting (OTCPK:BSYBF), saying the offer "doesn't reflect the long-term potential nor the internal value of Sky Deutschland (OTC:SKDTF)." Previously, BSkyB agreed to acquire 21st Century Fox's (NASDAQ:FOX) Sky Italia and 57% stake of Sky Deutschland for £4.9B ($8.3B) in cash, to create a European pay-TV giant with approximately 20M subscribers.
Rackspace says it is no longer looking for a buyer, after rejected offers and declaring its commitment to remain independent. The company has also named Taylor Rhodes as CEO, replacing Graham Watson, who will now be appointed non-executive chairman. Rhodes joined Rackspace (NYSE:RAX) in 2007 and has been president since February.
NASA has awarded Boeing and SpaceX contracts to build "space taxis" to ferry astronauts to the International Space Station, ending U.S. dependence on Russia for rides. Total potential contract value is $4.2B for Boeing (NYSE:BA) and $2.6B for SpaceX. The future spacecraft will launch from the Kennedy Space Center – Cape Canaveral complex.
Endo has submitted a proposal to acquire Auxilium for $28.10 per share in cash. The total value of the transaction would be $2.2B, a 31% premium to yesterday's closing price. In June, Auxilium agreed to take control of biotechnology firm QLT in a $345M stock deal. The purchase hasn’t yet closed, but Endo says its offer doesn’t include the deal for QLT. Endo International (NASDAQ:ENDP) is up 5.9% premarket; Auxilium Pharmaceuticals is up 41.6%.
7:00 MBA Mortgage Applications
8:30 Consumer Price Index
8:30 Current Account
10:00 NAHB Housing Market Index
11:00 EIA Petroleum Inventories
2:00 PM FOMC Announcement
2:00 PM FOMC Forecast
2:30 PM Chairman Press Conference
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