US prosecutors and BNP Paribas SA are likely to reach an
agreement which will force the bank to pay between $8 and $9
billion in penalties for violating US sanctions.
The Wall Street Journal
reported that the two sides have agreed to broad terms which
include the bank's admission of guilt and a ban on its operations
in US dollars in addition to the financial penalty. BNP was accused
of covering up its dealings with Sudan by routing billions of
dollars through various bank accounts in East Africa and the Middle
The ongoing investigation has heightened tension between the US
and France as French President Francois Hollande has said the
penalty being sought is "unfair" and not commensurate with the
In other news around the markets:
After months of tepid growth, the Chinese economy finally saw a
bright spot when PMI figures showed that the nation's factory
activity picked up as the government's "mini-stimulus" began to
make an impact. China's HSBC Flash Manufacturing Purchasing
Managers' Index rose to 50.8 in June, the first time the nation's
PMI score has surpassed the 50 point mark that indicates growth
since December. General Electric overcame the final obstacle in its
efforts to purchase Alstom SA's energy assets after Paris made a
deal with Bouygues SA to buy up to a 20 percent stake in Alstom on
Sunday. On Friday, GE revamped its offer to buy Alstom's energy
assets in order to give the French government more control over the
company's future. Following the revised bid, Alstom's board
officially accepted GE's offer on Saturday as the government
continued to negotiate with Bouygues over becoming Alstom's largest
shareholder. As the crisis in Iraq worsened over the weekend,
Iran's Supreme Leader Ayatollah Ali Khamenei condemned US offers to
help end the nation's uprising, saying that the Iraqi government is
capable of handling the situation, and that US intervention is
unwarranted. Meanwhile, Sunni militants headed towards Baghdad
after taking control of Syrian border posts. After a seven-day
ceasefire was declared in Ukraine on Friday, Ukrainian forces and
pro-Russian separatists raised their weapons once again just two
days later. Reports of fighting between the two sides on Sunday
proved that there is still work to be done before the crisis is
resolved. Russian President Vladimir Putin has urged the Ukrainian
government to hold talks with the rebel forces while his
counterpart, Ukrainian President Petro Poroshenko is asking for
Putin's support on the peace plan that he announced on Friday.
Asian markets began the week mixed; the NIKKEI was up 0.13
percent, the KOSPI rose 0.35 percent and the Shenzhen composite
rose 0.61 percent. However, the Hang Seng index was down 1.68, the
Shanghai composite fell 0.11 percent and New Zealand's NZ 50 was
down 0.37 percent.
European markets were down across the board; the UK's FTSE fell
0.46 percent, the eurozone's STOXX 600 lost 0.56 percent, Italy's
MIB was down 1.31 percent, the German DAX fell 0.81 percent and
France's CAC 40 fell 0.74 percent.
Crude futures rose as problems in Iraq continued to stoke supply
worries. Brent futures were up 0.47 percent and WTI futures gained
0.30 percent. Gold and silver were down 0.05 percent and 0.50
percent respectively while industrial metals were mixed. Copper
gained 0.82 percent and zinc was down 1.11 percent, but aluminum
lost 0.16 percent and tin was down 0.11 percent.
The euro was on the decline Monday morning, losing 0.14 percent
against the dollar, 0.38 percent against the yen and 0.18 percent
against the pound. The dollar was also lower, down 0.23 percent
against the yen and 0.30 percent against the Canadian dollar.
Notable earnings released on Friday included:
) reported first quarter EPS of $0.76 on revenue of $3.75 billion,
compared to last year's EPS of $0.64 on revenue of $3.31 billion.
Darden Restaurants (NYSE:
) reported fourth quarter EPS of $0.84 on revenue of $2.32 billion,
compared to last year's EPS of $1.01 on revenue of $2.30 billion.
Stocks moving in the Premarket included:
) was up 0.35 percent in premarket trade after gaining 3.99 percent
last week. General Electric (NYSE:
) rose 0.22 percent in premarket trade following news that Alstom
SA formally accepted its bid. NVIDIA (NASDAQ:
) was down 1.22 percent in premarket trade after falling 3.12
percent last week. Carnival Corp (NYSE:
) fell 1.13 percent in premarket trade after gaining 0.77 percent
Notable earnings expected on Monday include:
Micron Technology (NASDAQ:
) is expected to report third quarter EPS of $0.68 on revenue of
$3.87 billion, compared to last year's EPS of $0.04 on revenue of
$2.32 billion. Sonic Corporation (NASDAQ:
) is expected to report third quarter EPS of $0.29 on revenue of
$149.77 million, compared to last year's EPS of $0.26 on revenue of
Monday kicks off a busy week for PMI data with Services and
Manufacturing PMI figures due out from Germany, France, the
eurozone. Also notable will be the US' release of existing home
sales and Hong Kong's CPI.
For a recap of Friday's market action, click .
Tune into Benzinga's #PreMarket Prep show today to hear Lydia
Idem Finkley, Lawrence McMillan, Michael Pachter and Anka Metcalf
© 2014 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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