Opening Bell: 06.02.11

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SAC Capital Said to Face Insider Trading Inquiry (DealBook)
...the S.E.C.’s investigation into trading by SAC appears to be much broader. In addition to the inquiry into trading in health care stocks — trades that took place from at least 2007 through 2010 — the agency is examining SAC’s use of expert network firms, companies that connect Wall Street investors with outside experts in various industries, the person briefed on the matter said.

Goldman Accused of Withholding Lehman Emails (Deal Journal)
Lehman Brothers is accusing Goldman Sachs of intentionally delaying turning over emails in a bankruptcy probe of whether a secret Wall Street campaign helped short sellers profit at Lehman’s expense from the investment bank’s implosion. In a Tuesday filing with the U.S. Bankruptcy Court in Manhattan, Lehman said that despite agreeing last month to search for certain terms in emails from 37 proprietary trading-desk custodians, Goldman has only searched 11 custodians’ messages.

Geithner to meet Republican skeptics on debt limit (Reuters)
U.S. Treasury Secretary Timothy Geithner meets an influential group of freshman Republican lawmakers on Thursday to try to improve chances that Congress will increase his borrowing authority and prevent a government default.

Belarus to seek IMF bail-out (FT)
Belarus has said it will seek a $3.5bn-$8bn bail-out from the International Monetary Fund to try to ease a financial crisis that has forced a sharp devaluation and sparked panic buying of some goods. Such a move would be a significant volte-face by authoritarian president Alexander Lukashenko, who had sought support from Russia and other former Soviet states and recently lashed out at foreign interference in the Belarus economy.

E. coli: Russia bans import of EU vegetables (BBC)
Russia has banned the import of all fresh vegetables from the European Union because of the E. coli outbreak centred on Germany. The country's chief medical officer said EU-produced vegetables would be seized across Russia…The EU regarded the Russian ban as "disproportionate" and would be lodging a protest, European Commission spokesman Frederic Vincent said. He added that the total value of EU exports of fresh fruit and vegetables to Russia was 3-4bn euros a year, with Spain, France, Germany and Poland the biggest exporters. Russia banned vegetable imports from Germany and Spain earlier this week.

Big Banks Cash In on Commodities (WSJ)
A group of 10 large banks—including Goldman Sachs Group Inc., Morgan Stanley, J.P. Morgan Chase & Co., Citigroup Inc., Bank of America Corp. and Barclays PLC—saw their commodities revenues increase by 55% in the first quarter, according to Coalition, a firm that analyzes the performance of investment banks…Commodities trading is a bright spot for institutions that face new regulatory clampdowns on practices that previously fattened bank profit margins, such as trading with their own capital and slapping customers with hefty "overdraft" fees.

Shark! Dorsal fins from two 18-footers sighted near Long Island beach (NYDN)
A seal carcass also washed up near the East End beach, but it was unclear if it had been killed by the sharks, officials said. Cloudy skies made it difficult to confirm the exact species of the large predators, but authorities closed the West Hamptons Dunes beach after they saw the dorsal fins poking from the ocean surface.

Andreessen: It's Not A Bubble (Digits)
Netscape co-founder turned Silicon Valley venture capitalist Marc Andreessen wants to make clear that there is no bubble in tech. In an interview at the D9: All Things Digital conference late Wednesday, Andreessen said when asked if there’s a bubble in tech that “we don’t think there is.” The 39-year-old, who now runs venture-capital firm Andreessen Horowitz with partner Ben Horowitz, cited several reasons for his conviction, including the fact that there are currently “a very large number of people who think there’s a bubble–which makes us think there isn’t a bubble.” Andreessen added that “generally if everyone’s upset, that’s a good sign. But if people are euphoric, then I’m scared.”

Citigroup Said to Shut $400 Million Proprietary Fund as Ahmed Has New Role (Bloomberg)
The company closed the Quantitative Strategies fund after announcing in April that Shakil Ahmed, the fund manager, would become head of electronic market-making for New York-based Citigroup, according to the person, who declined to be identified because the matter is private. Ahmed also is co-head of electronic trading.

Flip creator gets into the grilled cheese business, Sequoia invests (Venturebeat)
Jonathan Kaplan, who previously led the company that created the Flipcamera, just announced his new project on-stage at the D9 conference — and it’s a grilled cheese company… The company has even raised venture funding from famed firm Sequoia Capital — Kaplan wouldn’t specify how much, but he said it was enough to open 20 stores, which cost between $500,000 and $1 million. So if you do the math, that’s at least $10 million.

Asian markets shed high frequency trading inhibitions (Reuters)
After years of resistance, the lucrative practice of high frequency trading is growing across Asia, driven by market demand, stock exchange consolidation and greater acceptance among regulators.

Bidder Emerges for Borders Bookstores (WSJ)
Private-equity firm Gores Group is in discussions to purchase more than half of Borders Group Inc.'s remaining stores out of bankruptcy, said people familiar with the matter, in a deal that would keep the bookstore chain operating as a going concern. Borders, which filed for Chapter 11 bankruptcy protection in February, has been soliciting offers for the company amid mounting losses and tense discussions with publishers that ship books to the chain.

In Wake of Natural Disasters, Insurers Brace for Big Losses (NYT)
Based on nearly two dozen interviews with farmers, business owners, analysts and government officials, private insurance companies are likely to experience at least $10 billion in insured losses this year, mostly associated with the tornadoes and the flooding along the Mississippi, based on property damage, lost inventory, business interruption and disrupted crop plantings.

Cowgirls Abandon Mares for Stick Ponies in Herpes Outbreak (ABC)
The contestants in a Utah rodeo queen contest had to abandon their mares and ride toy stick ponies -- all because of an equine herpes outbreak.

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