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Initial claims: Prior 341k, Market Expects 358k, Actual 362k

CPI: Prior 0, Market Expects 0.1%, Actual 0.0%

Core CPI: +0.3%

“The Federal Reserve, saying economic growth had “paused” in recent months, announced Wednesday it will continue its $85 billion monthly bond buying and hold interest rates near zero until unemployment falls to at least 6.5 percent.

The central bank decision, which followed a two-day meeting, had been widely expected, especially after a surprising decline in U.S. economic growth for the fourth quarter.

Earlier Wednesday, the government announced that GDP unexpectedly suffered its first decline since the 2007-09 recession, falling at a 0.1 percent annual rate after growing at a 3.1 percent clip in the third quarter. (Read More: GDP Shows Surprise Drop)

Markets showed relatively little reaction to the GDP report, in part because it reinforced expectations that the Fed will continue to provide stimulus as long as the economy is weak. Stocks were slightly lower after the Fed decision….”

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“Apple Inc’s manufacturing partner Foxconn Technology Group has frozen hiring at a Shenzhen plant that makes gadgets including the iPhone 5 and put the brakes on recruiting for other factories across China, but said the move was not linked to any single client.

Foxconn runs a network of factories across the world’s No. 2 economy that make products for tech companies from Hewlett Packard to Dell. It sought to pour cold water on a Financial Times report that it had imposed a hiring freeze while it slows production of Apple’s latest smartphone.

“Due to an unprecedented rate of return of employees following the Chinese New Year holiday compared to years past, our company has decided to temporarily slow down our recruitment process,” the company said in a statement.

“This action is not related to any single customer and any speculation to the contrary is false and inaccurate.” …”

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“To separate analysts posted reports this morning, arguing that Google‘s stock will go to $1,000 per share.

CLSA said it moved its price target due to Google ability to charge more for clicks on its ads.

And here is Bernstein Research analyst Carlos Kirjner argument, via Forbes:

“We believe mass adoption of smart phones, tablets and the mobile Web is a large value creation opportunity for Google,” Kirjner writes in a research note. “In other words, we disagree with the most popular Google bear case….”

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“(Reuters) – Chesapeake Energy Corp said on Wednesday its internal investigation of the financial dealings of outgoing chief executive Aubrey McClendon found no “intentional” wrongdoing, but authorities and analysts said the issue was far from over.

The company’s statement also said a review by its board of directors found Chesapeake “did not violate antitrust laws” as it acquired oil and gas rights in Michigan in 2010.

The company did not say how it reached its conclusions and did not release a full report of itsinvestigation, and state and federal investigations of the company continue.

The U.S. Securities and Exchange Commission is examining McClendon’s financial transactions, while the Department of Justice and the attorney general in Michigan are investigating whether Chesapeake violated antitrust laws.

“The importance of independent – rather than internal – investigations cannot be emphasized enough in a case involving antitrust bid-rigging allegations,” said a spokeswoman for Michigan Attorney General Bill Schuette. “Our thorough, independent investigation into these serious allegations will continue.”

A series of Reuters investigations last year triggered civil and criminal probes into the second-largest U.S. producer of natural gas. Big shareholders Carl Icahn and Southeastern Asset Management took control of the board in June after McClendon was stripped of the chairmanship of the company he co-founded in 1989….”

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“(Reuters) – When former Wells Fargo & Co Chief Executive Dick Kovacevich joined Norwest Bank in 1986, he had reservations about its private equity investments as he did not think it was the kind of business a bank needed to be in. He got over it.

“I was skeptical, met with the people and became convinced that they absolutely knew what they were doing and that this was a business we could manage and do well,” said Kovacevich, who became CEO of Wells Fargo when it merged with Norwest in 1998, and retired as chairman of the fourth-largest U.S. bank in 2009.

U.S. lawmakers shared Kovacevich’s skepticism about private equity when they crafted the Dodd-Frank financial reform bill in 2010. In a section of the law known as the “Volcker Rule,” they blocked banks from making big bets with their capital, including sizable investments in private equity funds, fearing taxpayers would be left on the hook when wagers soured.

The fine print of the Volcker Rule – named for former Federal Reserve Chairman Paul Volcker – is expected to be finalized as soon as this year. Major banks such as Bank of America Corp and Citigroup Inc are already pulling back from private equity investments ahead of the rules.

But Wells Fargo is taking a different path. The bank invests in buyouts and venture capital deals largely on its own, with capital only from Wells Fargo itself and some employees. By avoiding equity from outside investors, the bank is considered to be engaging in “merchant banking,” an activity that is likely to be exempt under the Volcker Rule, lawyers and people familiar with the matter said.

Wells Fargo’s private equity investments show how even button-down, staid banks are looking for loopholes in financial regulations as they seek to boost their profits….”

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“HOUSTON (AP) — Linn Energy is buying the drilling company Berry Petroleum Co. for stock worth about $2.5 billion.

Linn, an oil and gas producer, says the deal announced Thursday will broaden its presence in California, Texas and the Rockies and boost its production.

As part of the transaction, a Linn affiliate will issue 1.25 shares for each outstanding Berry share. That values Denver-based Berry’s stock at almost $46.24 per share, a 19.8 percent premium to Berry’s closing price on Wednesday.

The companies value the deal at $4.3 billion including assumed debt.

The combined company will be based in Houston.

The companies’ boards unanimously approved the deal. It still needs approval from the companies’ shareholders. The acquisition is expected to close by June 30.

Berry’s stock jumped more than 8 percent in premarket trading.”

“Wal-Mart Stores Inc. (WMT), the world’s largest retailer, projected first-quarter profit that trailed analysts’ estimates as an increase in the payroll tax curtails spending among its lower-income shoppers.

Earnings per share in the current quarter will be $1.11 to $1.16, the Bentonville, Arkansas-based company said today in a statement. Analysts projected $1.19, the average of 18 estimates compiled by Bloomberg.

Chief Executive Officer Mike Duke is working to keep prices low after a payroll-tax break expired Dec. 31, causing Americans to pay 2 percentage points more in Social Security taxes. The increased tax bite got Wal-Mart’s February sales off to the worst monthly start in seven years after disappointing results in January, according to executives’ e-mails obtained byBloomberg News.

“The low-end consumer is facing significant headwinds, including higher payroll taxes, delayed tax refunds, higher healthcare contributions, rising gas prices, and poor weather,”Deborah Weinswig, an analyst at Citigroup Inc. in New York, wrote in a report before the results were released.

Wal-Mart fell 0.7 percent to $68.75 at 7:20 a.m. in New York. The shares had gained 1.4 percent this year through yesterday….”

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“West Texas Intermediate oil dropped for a second day, extending the biggest decline in three months. U.S. crude stockpiles gained for the sixth week in seven, according to the American Petroleum Institute.

March futures fell 2.3 percent when they expired yesterday, the steepest drop since Nov. 20. U.S. crude inventories gained 2.96 million barrels last week to 372 million, the highest level since December, according to API data issued yesterday after futures settled. A government report today may show supplies rose 2 million barrels, according to a Bloomberg survey. TheFederal Reserve signaled it may consider slowing the pace of asset purchases, according to minutes of the Jan. 29-30 meeting.

“The much-needed correction has taken some steam off the overbought market,” said Andrey Kryuchenkov, a commodities analyst at VTB Capital in London, who forecast last week that oil prices would drop. “Short-term fundamentals simply do not justify sustained gains.”

WTI for April delivery slid as much as $1.67 to $93.55 a barrel in electronic trading on the New York Mercantile Exchange, the lowest since Jan. 16, and was at $93.87 at 11 a.m. London time. The March contract fell to $94.46 yesterday. The volume of all futures traded is 108 percent above the 100-day average.

Brent for April settlement tumbled as much as $1.48 to $114.12 a barrel on the London-based ICE Futures Europe exchange. Volume was more than 80 percent more than the 100-day average. The European benchmark grade was at a premium of $20.50 to WTI futures, compared with $20.38 yesterday. The gap expanded to $23.18 on Feb. 8, the widest since Nov. 26.

Fuel Stockpiles

Oil is extending losses in New York after breaching technical support yesterday, according to data compiled by Bloomberg. Futures settled below $95 a barrel, the trough between a “double-top” that formed after advances stalled near $98 on Jan. 31 and Feb. 13. The price gap is about $3, signaling crude may fall to around $92 in a so-called reversal. Losses tend to accelerate when chart support fails.

U.S. gasoline stockpiles slid by 122,000 barrels last week to 232.6 million barrels, API data show. The Energy Department is projected to show separately a decline of 900,000 barrels, according to the median estimate of 11 analysts in a Bloomberg News survey before its report is released today.

Crude supplies at Cushing, Oklahoma, the delivery point for futures traded on the New York Mercantile Exchange, increased 546,000 barrels to 50.8 million, according to the API….”

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“BAE Systems Plc (BA/), Europe’s largest arms maker, said it will buy back shares worth as much as 1 billion pounds ($1.5 billion) over three years after demand outside the U.S. and the U.K. helped swell its cash reserves.

BAE gained as much as 6.2 percent, the most since Sept. 12, the day that merger plans were announced with European Aeronautic, Defence & Space Co. BAE said it’s left those plans behind, and the company will embark on its buyback program today, underpinned by net cash of 387 million pounds. Earnings before interest, tax and amortization fell 6.4 percent to 1.89 billion pounds last year, beating analysts’ estimates….”

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“Allianz SE (ALV), Europe’s biggest insurer, said fourth-quarter net income more than doubled after profit from property and casualty insurance unexpectedly rose and year-earlier writedowns weren’t repeated.

Net income advanced to 1.22 billion euros ($1.6 billion) from 492 million euros in the fourth quarter of 2011, the Munich-based company said in an e-mailed statement today. Allianz was expected to earn 1.15 billion euros, according to the average estimate of 11 analysts in a Bloomberg survey.

“I am encouraged by our healthy growth in premiums, especially by recoveries in key European markets,” Chief Financial Officer Dieter Wemmer said in the statement. “This development shows that we are an attractive risk partner.”

European insurers such as Allianz, Axa SA (CS) and Prudential Plc (PRU) benefited from higher prices for some of their products last year after earnings in 2011 were hurt by record losses from natural catastrophes. A recovery in financial markets also helped bring an increase in investment income, outweighing the impact of lower interest rates.

Operating profit in property and casualty insurance rose to 1.26 billion euros in the fourth quarter from 1.09 billion euros a year earlier, beating the 941 million-euro median estimate of 11 analysts surveyed by Bloomberg. Gross written premiums increased 4.7 percent in 2012 as a whole.

The company will propose paying a dividend of 4.50 euros a share from last year’s profit, Diekmann said.

Profit Forecast

Allianz expects to have an operating profit of 9.2 billion euros this year, plus or minus 500 million euros. Operating profit was 9.5 billion euros last year, which matched a target for more than 9 billion euros, the company said….”

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“The euro declined below $1.32 for the first time in six weeks after an industry report showed services and manufacturing in the region shrank at a faster pace in February than economists forecast.

The 17-nation currency fell for a third day versus the yen on speculation the European Central Bank will have to keep borrowing costs lower for longer to help spur a recovery. The Dollar Index rose to a five-month high before the release of U.S. leading indicators and a regional manufacturing gauge that may add to evidence the economy is gathering momentum. The pound slid to a 2 1/2-year low against the dollar.

“The outlook in the euro area remains weak,” said Melinda Burgess, a foreign-exchange strategist at Royal Bank of Scotland Group Plc in London. “ECB policy will have to be looser and this will weigh on the euro.”

The euro fell 0.7 percent to $1.3185 at 7:01 a.m. New York time after dropping to $1.3168, the lowest level since Jan. 10. The common currency dropped 1.5 percent to 122.44 yen. The yen strengthened 0.7 percent to 92.88 per dollar.

RBS forecasts the euro will decline to $1.30 by the end of March and as low as $1.19 over the coming year, Burgess said.

The Dollar Index (DXY), which IntercontinentalExchange Inc. uses to track the greenback versus the currencies of six U.S. trading partners, gained 0.4 percent to 81.375 after rising to 81.508, the highest level since Sept. 5.

Industrial Output….”

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“Euro-area services and manufacturing contracted at a faster pace than economists forecast in February as the economy struggled to recover from the deepest recession in almost four years.

A composite index based on a survey of purchasing managers in both industries in the 17-nation currency bloc decreased to 47.3 from 48.6 in January, London-based Markit Economics said today. Economists had forecast a reading of 49, according to the median of 22 estimates in a Bloomberg survey.Germany’s services measure declined more than forecast to 54.1, while its factory gauge rose above 50, indicating expansion in that industry.

The data reinforce indications that the euro-area economycontinued to contract in early 2013 after the recession worsened in the fourth quarter. The European Central Bank forecasts gross domestic product will decline 0.3 percent this year.

“When you’re in the midst of the recession, and some would argue, a depression in some places like Greece, it’s hard to be optimistic,” Robert Savage, chief strategist at New York-based currency fund FX Concepts, said today in a Bloomberg Television interview. The PMI data “are highlighting the problem.”

The euro-area services index fell to 47.3 in February from 48.6 in January, its steepest drop in 10 months, today’s data showed. The manufacturing gauge slipped to 47.8 from 47.9. Markit will publish the final reading for the factory index on March 1 and the services and composite measures on March 3.

German Manufacturing

In Germany, Europe’s biggest economy, the services measure fell to 54.1 in February from 55.7 last month, the sharpest decline since August. The German manufacturing gauge rose to 50.1, moving into expansion for the first time in a year. France’s services gauge fell to 42.7 this month from 43.6 in January, while its manufacturing index increased to 43.6 from 42.9, today’s data showed….”

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“Sony Corp. (6758) unveiled the PlayStation 4, its first video-game console in seven years, introducing new cloud and social-media features as Chief Executive Officer Kazuo Hirai seeks to reignite sales.

Andrew House, CEO of Sony’s PlayStation unit, announced the product yesterday at an event inNew York. Consumers will be able to see what friends are playing and take over games in progress from others, and will eventually be able to stream older titles. The console will go on sale for the year-end holiday season, Sony said, without announcing prices.

The PlayStation 4 makes its debut amid an industry shift toward mobile play on smartphones and tablets, raising the question of whether gamers will shell out several hundred dollars for a new device. The console will allow self- publishing, mimicking the open architecture of smartphones that encourages smaller developers to create titles for the growing ranks of casual players. Sony fell as much as 2.1 percent.

“This enhanced PlayStation experience is simply not revolutionary to overcome big disruptions facing the industry,” Amir Anvarzadeh, a Singapore-based manager for Asia equity sales at BGC Partners Inc. (BGCP), said in an e-mail. “Sony’s heavy emphasis on the social aspect of PS4 seems a bit too ambitious to deliver on.”

Sony, Nintendo…”

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“China’s stocks fell, sending the benchmark index to its biggest loss since November 2011, on speculation more restrictions on the property industry will hurt demand for bank loans and construction materials.

A gauge of Shanghai developers slid 2.1 percent, poised for the biggest weekly drop since July, after the government told local authorities to halt real-estate speculation using measures such as home-price control targets and the expansion of a property tax. Anhui Conch Cement Co. (600585) slumped 5.4 percent. China Construction Bank Corp. (939), the largest mortgage lender, lost 2.9 percent. Jiangxi Copper Co. and PetroChina Co. led declines for metal and energy stocks after minutes from the Federal Reserve’s last meeting showed debate over further stimulus action….”

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“The Australian dollar declined, following yesterday’s biggest one-day drop in almost a month, as Asian stocks extended equity losses worldwide, curbing demand for higher-yielding assets.

The so-called Aussie slid versus its Japanese counterpart following a global commodities rout.New Zealand’s currency, known as the kiwi, dropped for a second day after central bank Governor Graeme Wheeler said yesterday he’s ready to intervene in foreign-exchange markets, prompting a surge in the local dollar’s volatility to a five-month high. Both South Pacific currencies fell as China told local authorities to “decisively” curb real estate speculation.

“There’s a bit of negative risk sentiment out there, so Aussie and kiwi have come under some pressure,” said Peter Dragicevich, a Syndey-based currency economist at Commonwealth Bank of Australia, the nation’s largest lender. “We expect them to bounce back over the next week or so.”

The Australian dollar lost 0.2 percent to $1.0233 as of 4:46 p.m. in Sydney after declining 1 percent to $1.0256 yesterday in the biggest drop since Jan. 24. The Aussie will rebound to $1.08 by Dec. 31, Dragicevich said. It bought 95.62 yen from 95.97 in New York.

Australia’s 10-year yield fell five basis points, or 0.05 percentage point, to 3.54 percent after touching a nine-month high of 3.61 percent yesterday.

The MSCI Asia Pacific Index (MXAP) of shares declined 1.6 percent. The Standard & Poor’s 500 Index tumbled 1.2 percent in New York yesterday, the largest drop since Nov. 14. The S&P GSCI Spot Index of 24 raw materials lost 1.1 percent, the most since Dec. 6, while the Thomson Reuters/Jefferies CRB Index declined 0.6 percent yesterday.

Volatility Spike…”

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