Monday's Early Headlines
- Obama Budget Pushes Deficit to Record Level -- President Obama unveiled his budget Monday designed to combat job woes in he U.S. The budget, which carries a price tag of $3.83 trillion, will push the deficit to a record $1.56 trillion. The deficit would remain above $1 trillion next year, although proposals were made for a tax boost for the wealthy and a three-year freeze on government spending outside of military and homeland security.
- Toyota Gas Pedal Fix to Begin This Week -- Toyota (TM) said Monday it would begin fixing accelerator pedals in recalled cars this week. Toyota is recalling up to 9 million cars worldwide, including 2.3 million in the U.S and Canada, and has halted production of eight cars in the U.S., while it sought to determine how to fix the problem. Toyota said Monday parts to reinforce the pedals are already being shipped to dealers and dealer training has begun. "We know what's causing the sticking accelerator pedals, and we know what we have to do to fix it," said Jim Lentz, president and chief operating officer of Toyota Motor Sales U.S.
- Citigroup to Sell Private-Equity Unit: Report -- Citigroup (C) plans to sell or split off its $10 billion Citi Private Equity unit as part of the bank's effort to reduce debt, according to a Bloomberg report. The unit's managers have discussed buying Citi Private Equity themselves along with new partners or with other financing, the report said. Citigroup's decision to sell Citi Private Equity was made last year, before President Barack Obama in January proposed banks be forced to unload their private-equity firms and hedge funds, the people familiar with the matter said, Bloomberg adds.
- Disney Reportedly Seeks Sales of Miramax -- Disney (DIS) is seeking a buyer for what remains of its beleaguered Miramax film unit which could fetch in excess of $700 million, The New York Times reports. The sale could come within a few months, said a mergers and acquisitions expert with knowledge of the process
- Amazon Gives In to Higher E-Book Prices -- Amazon.com (AMZN) has agreed to sell electronic versions of its books at prices it considers too high, giving in to publisher Macmillan. Amazon over the weekend pulled titles from Macmillan off its Web site because of a pricing dispute after Macmillan and other publishers worked out a new e-book pricing scheme for Apple's (AAPL) new iPad. Amazon said Sunday it was in "strong disagreement" with MacMillan's plan to sell e-books at $12.99 to $14.99 when first released, with prices dynamic over time.
Monday's Earnings Roundup
- Exxon Mobil (XOM) posted a fourth-quarter profit of $1.27 a share, falling from the year-ago quarter but better than the Thomson Reuters average estimate of $1.19 a share. Revenue in the quarter climbed to $89.8 billion from $84.7 billion, compared to the average analyst target of $86.19 billion.
- Humana (HUM) reported a fourth-quarter profit of $1.48 a share, matching the Thomson Reuters average estimate. Revenue climbed nearly 2% to $7.63 billion, although that was below the consensus of $7.78 billion. Looking ahead, Humana offered better-than-expected earnings guidance for the first quarter and it upped its earnings guidance range for 2010, although the new range of $5.15 to $5.35 a share was still below the $5.40 consensus target.
- Gannett (GCI) will also post quarterly results early Monday, with analysts expecting a profit of 64 cents a share on revenue of $1.45 billion, according to Thomson Reuters.