MORNING COFFEE

Bank and financial stocks are all over the news this morning.

SEC Wants To Widen BofA Suit.  The SEC requested court permission to expand its lawsuit against Bank of America (BAC), arguing that in addition to misleading shareholders on bonus payments at Merrill Lynch, BofA also failed to disclose Merrill's 'extraordinary losses.' The request was denied, but could be brought up in a separate case. 

Banks To Pay Clawback Fees.  President Obama may propose a fee on banks to help reduce the deficit. The proposal will may be included with Obama's budget plans, which are due to be released next month. The new fees could bring in as much as $120 billion from financial institutions that received a government bailout.  Many believe any such fees would be passed on to consumers.

Cuomo Wants Bank Bonus Info.  New York Attorney General Andrew Cuomo requested information on 2009 bonus plans from eight major TARP recipients, including Bank of America (BAC), Bank of New York Mellon (BK), Citigroup (C), Goldman Sachs (GS), JPMorgan Chase (JPM), Morgan Stanley (MS), State Street (STT) and Wells Fargo (WFC). In a statement Mr. Cuomo said pay should be "based on incentives that build strong institutions, not built on incentives that bring the nation to its knees economically and are based on short-term, fictional profits."

Alcoa (AA) kicking off the Q4 earnings season yesterday by missing their earnings estimates by 83.33%.  The company reported earnings of $0.01, the Street estimate was for $0.06 per share. The company saw lower sales in the construction, aerospace, commercial-building and gas-turbine markets, but said most of the loss stems from restructuring special items and tax charges.

Cadbury (CBY) posted strong 2009 results, with operating profit up +27% to £808M ($1.3B) and sales up +11% to £6B. Cadbury management once again urged investors to reject Kraft's (KFT) “wholly inadequate” hostile bid.

Infosys Technologies (INFY): Reported earnings of $0.59 beating estimates by $0.08 on revenue of $1.23B +5% vs. $1.17B. The company also issued upside guidance for Q4: EPS of $0.56 vs. $0.51 consensus; revenue of $1.24-1.25B vs. $1.19B consensus. Additionally they updated their full year guidance for FY10: EPS of $2.26 vs. $2.14 consensus; revenue of $4.75-4.76B vs. $4.66B consensus.

·         Futures: Dow -0.6%. S&P -0.6%. Nasdaq -0.7%. Crude -0.9% to $81.77. Gold -0.2% to $1,148.40.

·         Asia, Nikkei +0.75% to 10,879. Hang Seng -0.4% to 22,327. Shanghai+1.9% to 3,274. BSE -0.6% to 17,423.

·         Europe at midday, London -1.1%. Paris -1.1%. Frankfurt -1.2%.