Top 10 News Items for 12/31 to 01/04: Fiscal Cliff Agreement Reached; Job Creation Rises; Transocean, Google Settle

January 4, 2013 4:10 PM EST
1. Big news this week was passage of a deal by the Congress and Senate to avert about $600 billion in tax hikes and spending cuts more commonly known as "the fiscal cliff." House voted 257 to 167, sending the legislation to President Obama for his signature.

Benefiting will the be middle class with an extended tax shield; households making $450,000 or more per year will see taxes go up. Unemployment insurance will also be extended.

For a little more color, click here.

2. Amid high uncertainty that U.S. lawmakers would be able to forge ahead with a deal over the now-passed fiscal cliff, U.S. businesses found enough grit to keep expanding in December.

Nonfarm payrolls rose by 155,000 last month, outpacing expectations for a 152,000 increase and down slightly from a revised-higher 161,000 result in November. Private payrolls rose by 168,000 in December, from a revised 171,000 in November and the consensus of a 155,000 gain.

3. Transocean got a boost Thursday after it announced entering a settlement with the U.S. over the Deepwater Horizon disaster. The agreement settled civil and criminal charges against Transocean. According to the company, it will pay about $1.4 billion in fines, recoveries, and penalties. For more color, click here.

4. The FOMC issued minutes for its December 11 - 12 meeting in Thursday. The most notable part was that a few members though it would be appropriate to slow or stop QE before the end of 2013. The Fed had not really given a specific time frame on when open market activity would end, only that it would keep rates low through the end of 2014.

For the full statement from the Fed, click here.

5. Following a 20-month probe, the FTC and Google (Nasdaq: GOOG) came to a settlement over the inquiry on Thursday. Google will allow competitors to access critical patents and allow more flexibility for advertisers on AdWords. For the full FTC statement and concessions, click here.

In a separate news bit this week, Executive Chairman Eric Schmidt will accompany former New Mexico Governor Bill Richardson on a trip to North Korea. That announcement raised some eyebrows given the strained relationship the U.S. has with the Communist nation.

6. Boeing Co. (NYSE: BA) hit a new 52-week high on Friday ($78.02) following news of a massive 737 MAX order from Aviation Capital Group (ACG) on Wednesday. The order for a total of 60 737s has a book value of $6 billion.

Later, Boeing announced that 2012 was a pretty good year: deliveries of 601 beat expectations, 737 orders surpassed the 1,000 milestone, and its commercial backlog stood at 4,373 aircraft, a company record. The numbers could put it on pace to regain the title of world's largest manufacturer, a title ceded to rival Airbus in 2002.

7. Not the world's largest deal, but still a notable one. Avis Budget (Nasdaq: CAR) announced that it would acquire Zipcar (Nasdaq: ZIP) for $12.25 per share, or total value of about $500 million. The deal might hint of a new branch for the rental car business, something a little more accommodating than being stuck with a rental for 24-hours when you only need it for a few.

8. Warren Buffett's MidAmerican Renewables announced plans to acquire the 579-megawatt Antelope Valley Solar Projects (AVSP) from SunPower (Nasdaq: SPWR), sending solar shares soaring. SunPower is up over 50 percent for the year, LDK Solar (NYSE: LDK) is up 48 percent, ReneSola (NYSE: SOL) is up 20 percent, Suntech Power (NYSE: STP) is up 23 percent, and more.

9. Family Dollar (NYSE: FDO) shares ended about 11 percent lower this week following a first-quarter EPS miss and cut outlook on Thursday. CEO Howard Levine commented, "Early results from our sales-driving initiatives exceeded our expectations in the first quarter, resulting in more gross margin pressure than anticipated. This mix pressure, combined with expected headwinds from insurance expense, resulted in earnings that were at the low end of our guidance." For more on the numbers, click here.

10. U.S. manufacturing expanded for the 43rd consecutive month in December with an uptick in employment as well.

The Institute for Supply Management (ISM) purchasing-managers index (PMI) rose 1.2 points to 50.7 percent last month. The Street consensus called for a reading of 50.5 percent.

The average reading over the last 12 months was 51.7 percent, with a high of 54.8 and low of 49.5 percent.

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Warren Buffett, Nonfarm Payrolls, Federal Open Market Committee, Top 10 News Items for the Week, Barack Obama, Earnings

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