Global Markets Roiled by Nikkei’s 7.3% Slide (AP)
Several reasons have been blamed for the 7.3 percent fall in the Nikkei index to 14,483.98, including a spike in Japanese government bond yields and unexpectedly weak Chinese manufacturing figures.

Euro-Zone Business Activity Falls Again (WSJ)
Markit Economics said its composite purchasing managers’ index for the euro zone—a measure of activity in the services and manufacturing sectors—rose to 47.7 from 46.9 in April, a stronger outcome than that forecast by economists but still below the level of 50 that separates growth from contraction. Speaking after the surveys were released, a member of the European Central Bank’s governing council said he didn’t expect the euro zone’s economy to pick up in the near future. “From my personal view, I don’t see at the moment any indication of a significant improvement in the economic situation for the immediate future,” said Ewald Nowotny, who is also governor of the Austrian central bank.

Wall Street Seeks Dodd-Frank Changes Through Trade Talks (Bloomberg)
U.S. bankers and insurers are trying to use trade deals, which can trump existing legislation, to weaken parts of the Dodd-Frank Act designed to prevent a repeat of the 2008 financial crisis. While the companies say they are seeking agreements that preserve strong regulations and encourage economic growth, their effort is drawing fire from groups who argue that Wall Street wants to make the trade negotiations a new front in its three-year campaign to stop or alter the law.

In a Plus for Electrics, Tesla Repays a Big Federal Loan Early (DealBook)
“Today’s repayment is the latest indication that the Energy Department’s portfolio of more than 30 loans is delivering big results for the American economy while costing far less than anticipated,” Ernest Moniz, the energy secretary, said in a statement. … The Energy Department on Wednesday said that losses on its loans were equivalent to 2 percent of its $34 billion portfolio.

Rating agencies under fire again (FT)
… for not upgrading RMBS fast enough.

For Philadelphia Bicyclist, a Cat Is His Co-Pilot (AP)
“People are thrilled to see the guy with the cat ride his bike down the street,” Saldia said. But online commenters have been less kind, questioning whether the unharnessed cat is safe. Saldia noted he is equally vulnerable while riding in the city and takes necessary precautions. “I’m very confident that the cat would be better off in an accident than I would be, so I’m not worried about taking her out,” he said.
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Bernanke Expected to Deliver Dovish Message (CNBC)
Bernanke appears before the Joint Economic Committee at 10 a.m. EDT, and at 2 p.m., the minutes of the last Fed meeting will be released. “The doves are taking back the reins. The hawks had their day in the sun,” said George Goncalves, Treasury strategist at Nomura Americas. “I think the bond market is going to be happy because Bernanke’s going to reiterate his dovishness, and he’s still cautious, but he’s constructive on the economy,” said Goncalves. “I think all markets are going to be pleasantly surprised tomorrow. I think the minutes might introduce some volatility because there’s definitely tension at the Fed about when to stop and when to do more.”

Instant Bloomberg not going to fade away yet (FT)
The biggest challenge in persuading banks to change their messaging habits, Mr Hod admits, is that “many of their clients are talking to them on Bloomberg”. Other questions any rival chat system must answer include who will own and secure sensitive messaging data, and what regulatory oversight will it allow. … Two rival executives said the record of failed past attempts meant they doubted that threats to Bloomberg’s messaging dominance would emerge overnight. But just as Facebook usurped MySpace, one said, Bloomberg’s community could also one day switch to a new social network.

Sony Board to Discuss Third Point Plan (WSJ)
Under pressure from an activist investor to take part of its entertainment business public, Sony Corp. said it plans to discuss the proposal with its board. “The proposal from Third Point, Dan Loeb is something that we should discuss thoroughly at a board meeting and then we’ll decide Sony’s stance,” Chief Executive Kazuo Hirai said in a briefing Wednesday to lay out his strategic vision for the company. “Therefore, we are now going to start the discussion and we are still at the starting stage.”

BoJ holds amid signs of economy ‘picking up’ (FT)
The Bank of Japan kept its monetary settings on hold on Wednesday, judging that the huge stimulus unveiled in April will be enough to spur price gains in the world’s third-largest economy. In its statement, the central bank said its decision to stand pat – which was widely anticipated by investors – came amid signs of “positive movements” in economic activity in Japan, supported by the bank’s pledge in April to double the country’s monetary base within two years to achieve a 2 per cent rate of inflation.

Buffett, With His Magic Touch, May Be Irreplaceable (DealBook)
The ability to make acquisitions on favorable terms is a testament to Mr. Buffett’s personality and skills as a deal maker. It also highlights an almost unsolvable problem for his company, Berkshire Hathaway, and its shareholders. When its 82-year-old chief executive is gone, who will negotiate such sweet deals? … Mr. Buffett has a unique ability to not only score a low acquisition price, but he can scare off competitors and attract other investors. Boards of target companies also appear to run into his grasp.

Vatican denies claims Pope Francis performed public exorcism (AP)
Is Pope Francis an exorcist? The question has bubbled up ever since Francis laid his hands on the head of a young man in a wheelchair after celebrating Sunday Mass in St. Peter’s Square. The young man heaved deeply a half-dozen times, shook, then slumped in his wheelchair as Francis prayed over him. The television station of the Italian bishops’ conference reported Monday that it had surveyed exorcists, who agreed there was “no doubt” that Francis either performed an exorcism or a prayer to free the man from the devil. The Vatican was more cautious. In a statement Tuesday, it said Francis “didn’t intend to perform any exorcism. But as he often does for the sick or suffering, he simply intended to pray for someone who was suffering who was presented to him.”
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Apple’s Web of Tax Shelters Saved It Billions, Panel Finds (NYT)
Thanks to what lawmakers called “gimmicks” and “schemes,” Apple was able to largely sidestep taxes on tens of billions of dollars it earned outside the United States in recent years. Last year, international operations accounted for 61 percent of Apple’s total revenue. … “There is a technical term economists like to use for behavior like this,” said Edward Kleinbard, a law professor at the University of Southern California in Los Angeles and a former staff director at the Congressional Joint Committee on Taxation. “Unbelievable chutzpah.”

JPMorgan investors on edge over vote on Dimon; what if they win? (Reuters)
Investors say that while Dimon, 57, may need more oversight after the bank posted $6.2 billion in losses from failed derivative trades last year, they do not want him to quit. Among big bank CEOs, Dimon ranks first for stock returns and has been praised for leading the bank through the financial crisis with no quarterly losses and a strong balance sheet. If Dimon were to leave, the bank’s shares could fall as much as 10 percent and erase about $20 billion of market value, according to Mike Mayo, a bank analyst with brokerage CLSA. JPMorgan also has no ready replacement for Dimon, Mayo wrote in a research note, adding that the two lieutenants best positioned to succeed him – Matt Zames, 42, and Mike Cavanagh, 47 – seem to be about three years short of being ready for the job.

SAC Capital Aims to Stem Withdrawal Requests (DealBook)
“I’m very comfortable and confident having my money with him,” said Ed Butowsky, managing partner of Chapwood Investments in Dallas, a firm that invests client money in SAC. “All I know is that the returns are coming in nice, and my clients are happy.”

Funds Get Active Over Director Pay (WSJ)
Current pay structures don’t give directors enough of a stake in making sure the company does well, and boards need to be more creative about tying their compensation to performance, said John Wakeman, a vice president and portfolio manager at mutual-fund giant T. Rowe Price Group Inc. “If bad people are going to be on these boards, we’ve got to stop it,” said Mr. Wakeman. “We owe it to our fund holders.”

Buffett Jets Chief Says U.S. Leads Private-Flight Rebound (Bloomberg)
The U.S. is leading a recovery in demand for private flights while Europe remains weighed down by economic weakness, the head of billionaire Warren Buffett’s jet-management company said. “The U.S. from our perspective is coming back and doing relatively well,” Jordan Hansell, chief executive officer of Berkshire Hathaway Inc.’s NetJets, said by phone yesterday from Geneva, where he is attending the European Business Aviation Convention & Exhibition. “Europe has remained difficult.”

Poor li’l rich kids: Posh schools scold parents who send nannies (NYP)
Wealthy New Yorkers are shunning their parental duties — choosing instead to send nannies to their children’s private schools to take part in everything from “safety patrol” to accompanying the kids on their entrance interviews. … “Now the schools are getting angry — and other parents are getting angry. They don’t want to work the school bake sale with someone’s paid employee,” Uhry said. … But one Upper East Side mom whose daughter attends The Birch Wathen Lenox School sniffed that she pays the school $40,000 a year — and can’t be bothered with such menial duties. “These schools are exorbitantly expensive, they hit you up for school fees, donations, and then they want your time?” she huffed. “I have three kids at three different schools. If I can send my nanny, I’m happy to do it.”
Former Horace Mann admissions director Dana Haddad said schools now accept nannies at admissions interviews because kids tend to perform better in front of them. “When I was a director of admissions and children would act up, I would tell parents, ‘Don’t worry, send them back with the nanny,’ ” said Haddad.
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Hedge Fund Owner Gets Subpoena to Testify (DealBook)
By subpoenaing Mr. Cohen, the government indicated that it was pursuing a case against SAC itself. Federal guidelines discourage prosecutors from soliciting grand jury testimony from the target of an investigation, which suggests that Mr. Cohen was being treated as if he were a potential witness against his own fund. While the authorities have not settled on a strategy, according to the lawyers and executives briefed on the case, they are pursuing an avenue that could possibly lead to an indictment against SAC, accusing it of allowing traders to carry out illicit activity over years.

Yahoo Is Planning to Buy Tumblr for $1.1 Billion (NYT)
For Yahoo and its chief executive, Marissa Mayer, buying Tumblr would be a bold move as she tries to breathe new life into the company. The deal, the seventh since Ms. Mayer defected from Google last summer to take over the company, would be her biggest yet. It is meant to give her company more appeal to young people, and to make up for years of missing out on the revolutions in social networking and mobile devices. Tumblr has over 108 million blogs, with many highly active users.

Enron No Lesson to Traders as EU Probes Oil-Price Manipulation (Bloomberg)
Shell, London-based BP and Statoil ASA, three of Europe’s biggest oil explorers, are under investigation for potential manipulation of prices in the $3.4 trillion-a-year global crude market. The involvement of McGraw Hill Financial’s Platts, which publishes pricing data, hearkens back to other pricing scandals including Enron, and more recently, Libor. “We’re making exactly the same mistakes we did with Enron, just with a different commodity,” Robert McCullough, an energy consultant, said by telephone from Portland, Oregon. “The same manipulation we saw in electricity and gas pricing is what we’re seeing in oil.”

Gold Slump Hits Silver (WSJ)
Falling appetite for the safe haven of gold has pushed the metal down 20% since the start of the year as inflation fears faded and global growth improved. In Asia, investors have zeroed in, especially on Japan where the central bank’s aggressive easing measures have kick started an economic recovery and pulled up shares. The biggest moves on Monday were felt in silver, which dropped 9% in the first 10 minutes of Asian trading, touching its lowest level since September 2010. It later recouped some losses to trade down 3.9%. Silver is less liquid than gold and therefore more susceptible to such sharp moves. Spot gold fell 1.2% to $1,344 a troy ounce, and is off 8.9% since the beginning of May.

Barbie eyeing a Manhattan penthouse in search for new dream home (NYP)
Barbie is moving from her California mansion and embarking on a quest for new digs that could land her in a posh penthouse with Central Park views, makers of the doll say. Toymaker Mattel has hired a team of top-notch interior designers to create three “dream houses” — in New York, California and India — and will announce its choice in August. … Barbie’s VP of marketing, Lori Pantel, said the story reflects the doll’s evolution as an independent woman. “As a workingwoman with over 135 careers, Barbie is proud to have a Manhattan home,” Pantel said. “It’s a glamorous work space to host movers and shakers.”
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To Buy Bonds or Not to Buy: Fed Hawks, Doves Air Views (WSJ)
The presidents of the Dallas, Richmond and Philadelphia Federal Reserve banks, long skeptics of the wisdom of the bond buying, said this week that they would like to see the purchases scaled back immediately. And San Francisco Fed President John Williams, who has been enthusiastic about the merits of the program, said Thursday that he is still prepared to reduce the size of the purchases “as early as this summer.” The president of the Boston Fed, meanwhile, suggested that there is a case that the Fed should be doing even more to boost the economy.

Dell Profit Missing Estimates Boosts CEO’s Buyout Plan (Bloomberg)
Profit excluding some items fell to 21 cents a share for the period that ended May 3, from 43 cents a year earlier, Round Rock, Texas-based Dell said in a statement yesterday. Analysts on average had projected 35 cents, according to estimates compiled by Bloomberg. Revenue (DELL) declined 2.4 percent to $14.1 billion, beating analysts’ average $13.5 billion projection. The plunge in profit lends credence to a plan by Chief Executive Officer Michael Dell and Silver Lake Management LLC to take the company private in a $24.4 billion leveraged buyout. … “The Icahn solution gets less attractive, and the bird in the hand looks better than the one in the bush,” said Chris Whitmore, an analyst at Deutsche Bank AG in San Francisco, who has a hold rating for the shares.

How Elliott and Hess Settled a Bitter Proxy Battle (DealBook)
[T]he company began announcing steps intended to raise its stock price, including selling its gas stations, raising its dividend and announcing a stock buyback. It also replaced the slate of directors up for re-election this year — including Mr. Kean and Mr. Nunn — with a group that includes John Krenicki Jr., a former vice chairman of General Electric. Later, the company agreed to separate the roles of chairman and chief executive, both currently held by Mr. Hess, the son of the founder. (The board on Thursday named Mark Williams, one of its new directors, as nonexecutive chairman.) And the Hess family agreed to support a proposal in which directors would be re-elected every year, rather than every three years.

Day Traders Steer Tesla Higher (WSJ)
The whipsaw trading can complicate longer-term investors’ efforts to assess companies’ prospects and create volatility that draws the ire of corporate managers. … Such traders in recent years have targeted the shares issued by companies including Netflix, Green Mountain Coffee Roasters and Priceline.com. In 2010, Chipotle Mexican Grill hit the radar screen of day traders. Its share price quadrupled over the next two years while trading volume nearly doubled. At its peak, the stock was trading at 47 times projected future earnings, according to FactSet, more than double that of McDonald’s Corp. and Taco Bell operator Yum Brands Inc.

Hedge Fund Billionaire William Ackman, Investor Group in Contract to Buy a New York Penthouse for Over $90 Million (WSJ)
Mr. Ackman does not plan to move in, a person familiar with the plans said, and the group views the penthouse as an investment.

For Sale: A Video of Toronto Mayor Rob Ford Smoking Crack Cocaine (Gawker)
Rob Ford, Toronto’s conservative mayor, is a wild lunatic given to making bizarre racist pronouncements and randomly slapping refrigerator magnets on cars. One reason for this is that he smokes crack cocaine. I know this because I watched him do it, on a videotape. He was fucking hiiiiigh. It’s for sale if you’ve got six figures.
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JPMorgan presses Bloomberg on reporters’ access to data (Reuters)
The largest U.S. bank is seeking logs for five years of what precisely Bloomberg journalists accessed concerning the use of terminals by JPMorgan employees, a bank official said. Bloomberg has about 2,400 journalists worldwide. JPMorgan said it is also seeking “confirmation” of controls that Bloomberg has put in place to stop future breaches.

JPMorgan Shareholders Are Denied Access to Results (DealBook)
The firm that is providing tabulations of the JPMorgan vote stopped giving voting snapshots to the proposal’s sponsors last week. The change followed a request from Wall Street’s main lobby group, the firm says. … Lyell Dampeer, a senior executive at Broadridge, said his firm was required to give real-time results to companies, and for years Broadridge gave that same information to proposal sponsors. But late last week, he received a call from an employee of the Securities Industry and Financial Markets Association, Wall Street’s main lobby group, requesting that Broadridge cut off access to organizations that are sponsoring proposals, he said. Sifma represents JPMorgan and other big banks and brokerage firms.

What’s a CEO Worth? More Firms Say $10 Million (WSJ)
Compensation awarded to CEOs of 300 U.S. companies rose a median 3.6% to $10.1 million, the analysis found. The total includes salary and annual bonuses, plus the value of restricted stock and stock options at the time they were granted. The companies surveyed, all of them public, with revenue exceeding $7.5 billion, were the largest to file proxy statements between May 1, 2012 and April 30, 2013. … Last year’s relatively modest increase in CEO compensation followed a 2.3% bump in 2011.

Hedge Funds Dump Apple, Jump into Hess, Dell Fights in Q1 (CNBC)
Yesterday was 13F day.

Funds bet Greece will survive and thrive (FT)
This further fuelled an already eye-catching rally in Greece’s restructured bonds, sending the 10-year bond yield tumbling 74 basis points to well below the 9 per cent mark, the lowest in three years. The Athens stock exchange rallied to the highest since August 2011. The Greek debt management agency is even talking of issuing bonds next year, a prospect that not so long ago would have seemed highly optimistic. Now bankers and investors say selling shorter-term bonds would be feasible.

Wife of ‘Rain Man’ Libor Trader Starts to Talk on Twitter (WSJ)
Tom Hayes, the former UBS and Citigroup trader known to colleagues as “Rain Man” for his brainy but socially awkward demeanor, has been mostly silent since the U.S. Justice Department charged him last December with trying to manipulate Libor. … Recently, though, someone in Mr. Hayes’s corner has started speaking up: his wife, Sarah Tighe Hayes. A few days ago, she started tweeting under the handle @SarahTigheHayes. Mixed in with tweets about soccer and child-care are a handful of posts in which she has shared with her eight followers her thoughts about Libor and what she sees as the U.S. justice system’s propensity for overkill.

Twitter CEO Costolo on Improv, VCs and Burritos (PEHub)
“Out in the Midwest, you don’t have to worry about ‘I have to get them better burritos or they’re going to go somewhere else,” he says. “You have to worry about that stuff here.” … As for venture capitalists, another group disproportionately represented in Silicon Valley, Costolo was decidedly tongue-in-cheek. Asked what he likes most about VCs, Costolo replied: “They pick up the check at dinner.” Asked what he likes least about VCs, he had a one-word answer: “Dinner.”
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