US stocks slid today as oil topped the dubious $100 a barrel mark. Meanwhile on the Europe front, the Greek government faces a confidence vote and Italian bond yields went back up to 6.99%.
More downsizing is expected in the financial sector as Wall Street is still suffering from the 3 year old financial meltdown.
Don Mattingly, the Los Angeles Dodgers manager who was my favorite New York Yankee in his career from 1982-1995, can't seem to get a break with this ongoing Fox Sports/LA Dodgers war over the pending sale of the esteemed franchise. Despite not being able to acquire players with Major League Baseball ceasing the franchise, Mattingly still led the Dodgers to a respectable 82-79 record despite the constant financial chaos.
Here are the top financial stories of the day:
1) Stocks fall broadly as oil tops $100 a barrel-From AP
Stocks fell broadly in midday trading Wednesday as the price of oil topped $100 a barrel for the first time since July.
The jump in the price of crude could weaken the already U.S. fragile economy by raising costs for gas, heating oil and airline fuel. Oil futures jumped 2.7 percent to $102 a barrel as U.S. supplies dropped and a deal for a new pipeline threatened to cut them even more.
Stocks fell on Wednesday in another low volume day, with selling accelerating late in the session on more warnings about the potential impact of the euro zone's debt crisis on the economy and the banking system.
Based on the latest available data, the Dow Jones industrial average was down 190.11 points, or 1.57 percent, at 11,906.05. The Standard & Poor's 500 Index was down 20.77 points, or 1.65 percent, at 1,237.04. The Nasdaq Composite Index was down 46.06 points, or 1.71 percent, at 2,640.14.
U.S. economic reports were mixed. Output at the nation's factories, utilities and mines rose at the fastest pace in three months in October, the Federal Reserve said. Production of autos and parts surged 3.1 percent.
Consumer prices largely held steady last month. The Consumer Price Index dropped 0.1 percent in October, led by a steep decline in gas prices. An index of builder sentiment rose to the highest level since May 2010, but is still well below a level consistent with a strong housing market.
Concerns lingered about Europe's debt crisis as well. Greece's new prime minister, Lucas Papademos, faces a confidence vote later Wednesday. His government must pass unpopular austerity measures to receive the next round of emergency loans.
The vote comes one day after reports that the European Union economy grew by just 0.2 percent between July and September, a sign that Europe may be headed for a recession. Together, the countries in the European Union are the world's largest economy and a key source of revenue for companies in the Standard and Poor's 500 index.
Borrowing rates remained dangerously high for Italy and other large European countries like Spain and France, the latest signal that Europe's debt woes could be spreading from smaller countries like Greece and Portugal and into the industrial core of the region.
The yield on Italy's benchmark 10-year government bond was 6.99 percent, a level widely seen as unsustainable. Comparable rates for Spain and France were 6.37 percent and 3.69 percent. That's far above the 1.81 percent rate that Germany, Europe's strongest economy, has to pay to borrow money on debt markets.
In corporate news, Target Corp. gained 0.1 percent after sales growth and an improvement in its credit card business helped the retailer beat Wall Street's profit estimates. Abercrombie & Fitch Co. plunged 14 percent after the company reported earnings that fell far short of Wall Street's expectations. The company said rising costs for cotton and other commodities cut into profits.
Dell Inc. dropped 2.5 percent after the company said late Tuesday that its revenues will be held back by an industry-wide shortage of hard drives.
2) Citi to Shed 1% of Its Workers; BNP Paribas Plans to Cut 7%-From The New York Times
The ax continues to fall on Wall Street.
Citigroup is drawing up plans to eliminate about 3,000 jobs, or 1 percent of its global work force, and on Wednesday, BNP Paribas announced plans to cut about 1,400 jobs, or 7 percent of its staff.
While Citigroup has not settled on a final number, the staff reductions could exceed 3,000, with roughly a third coming from its securities and banking unit, said one person with direct knowledge of the plans who spoke anonymously because the numbers were not final. Citigroup has already notified some employees who will lose their jobs in the coming months. The timing of the layoffs is also uncertain, and could take place throughout the next year.
At BNP Paribas, almost 400 jobs will be eliminated in France, with the remaining layoffs coming at the bank's international operations.
The moves reflect the broader austerity measures across Wall Street.
Goldman Sachs has prepared to eliminate about 1,000 jobs, or roughly 3 percent of its work force. The bank also could cut up to $1.45 billion in costs, or 5 percent of its expenses, as DealBook previously reported.
Bank of America, perhaps the most embattled American banking giant, has already shed 3,500 jobs in recent months, and that its only a starting point. The bank, which continues to labor under the weight of its troubled mortgage business, could yet decide on a broader round of job cuts resulting in 30,000 layoffs.
Foreign banks are also trimming their rosters. UBS announced earlier this year that it would eliminate 3,500 jobs over the next next two-plus years, a move to rein in costs at the struggling Swiss bank. Credit Suisse also has plans to cut about 600 jobs in its investment banking operation.
Nomura of Japan said on Wednesday that it had begun a new round of layoffs as part of the bank's attempt to reduce costs by $1.2 billion. A Nomura official declined to give an exact figure, but said the majority of cost savings would come from Europe, where the bank employs about 4,500 people.
3) Dodgers Sue Fox Over Sale of Media Rights-From The Wall Street Journal
The Los Angeles Dodgers sued Fox Sports in bankruptcy court Wednesday for allegedly interfering with the team's bid to sell its valuable broadcast rights.
According to the suit, Fox Sports has violated the shield of bankruptcy protecting the Dodgers by sending a cease-and-desist letter to the firm that is marketing the Dodgers' franchise and media rights.
The team and media rights are going up for sale under a settlement the team recently reached with Major League Baseball.
"The issuance of the Fox letter was intended to interfere with the sale of the Dodgers and their assets in bankruptcy," the team said in the lawsuit, filed with the U.S. Bankruptcy Court in Wilmington, Del.
"It also constitutes an impermissible exercise control over [the team's] property."
Fox Sports has the right to broadcast Dodgers games through the 2013 season.
The Dodgers asked the court to issue a temporary restraining order or injunction against Fox Sports to prevent it from trying to obtain, control or interfere with the Dodgers' current and future media rights.
The team is also seeking damages from Fox Sports for its alleged violation of the automatic stay, which protects companies in bankruptcy from actions taken by creditors.
"Fox's efforts to take possession of property of the [Dodgers] estate and to exercise control over such property violate the automatic stay...are affecting and will continue to affect the estate adversely, including the efforts of the [Dodgers] estate to evaluate, market and potentially dispose of its existing and future media rights," the lawsuit said.
"This is just the latest chapter in the current owner's ongoing scheme to avoid honoring his contractual obligations," said Chris Bellitti, vice president of communications for Fox Sports. "The full truth of this unfortunate situation will soon become apparent to all."
Fox Sports is a unit of News Corp., which also owns The Wall Street Journal.
Earlier this month, the Dodgers agreed to sell the franchise as part of a deal with Major League
Baseball that settled months of bickering over how the bankruptcy would be resolved.
In bankruptcy court last week, Fox Sports attorneys expressed concern that they haven't yet seen a formal settlement. The team has filed a motion with the bankruptcy court to sell the broadcast rights but hasn't yet filed a copy of the settlement or a motion to sell the team itself.
"We are very concerned by what is being described by both the media and by counsel with respect to the supposed settlement terms, and whether they will adequately consider the dignity of contracts implicated by such a settlement," said Fox's lawyer Paul Laurin at a Nov. 8 hearing in the U.S. Bankruptcy Court in Wilmington.
Before the settlement was reached, Fox Sports had sued the Dodgers in bankruptcy to block the proposed sale of its media rights. Last Thursday, the network filed court papers announcing its intention to file an amended lawsuit. It hasn't yet done so.
Harvey Mackay's Moral: Instead of giving myself reasons why I can't, I give myself reasons why I can.
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