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Opening Bell: 09.03.14

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Credit Suisse Said to Be Investigating Two Equities Traders (Bloomberg)
Zoe Henderson and Andrew Davis, who runs the desk, are being probed, said the person, who asked not to be identified because they weren’t authorized to speak publicly. Both remain employees of the bank, the person added. Henderson has been listed as inactive on the Financial Conduct Authority’s register since Feb. 13 and Davis since Aug. 4. Henderson was accused by the bank of improperly sharing client communications with her husband, an equities trader at Royal Bank of Canada, through electronic chat rooms, the Wall Street Journal reported earlier today, citing unidentified people with knowledge of the matter. Henderson has told Credit Suisse her actions didn’t penalize clients and were normal practice, the newspaper said. Her husband, Toby Henderson, remains in his job and hasn’t been accused of wrongdoing, the Journal said.

Former NSA Chief Says JPMorgan Hack May Be a Warning (Bloomberg)
Keith Alexander, the NSA director from 2005 until last March, said he had no direct knowledge of the attack though it could have been backed by the Russian government in response to sanctions imposed by the U.S. and EU over the crisis in Ukraine. “How would you shake the United States back? Attack a bank in cyberspace,” said Alexander, a retired U.S. Army general who has started his own cybersecurity company to sell services to U.S. banks. “If it was them, they just sent a real message: ‘You’re vulnerable.’”

IEX, Upstart Trading Platform, Raises $75 Million in New Financing (Dealbook)
Until March, few outside of Wall Street had heard of IEX, an upstart stock-trading platform aimed at tempering the advantages of big financial firms and their superfast computers. Then Michael Lewis came along. Thanks in part to attention brought in by Mr. Lewis’s book “Flash Boys,” which profiled the team behind IEX, the trading platform has raised $75 million in a new round of financing. That money will help the start-up become a full-fledged stock market. Several investors — the venture capital firms Spark Capital and Bain Capital Ventures; Massachusetts Mutual Life Insurance and the mutual fund manager Franklin Templeton; and the Netscape co-founder James H. Clark and the casino billionaire Steve Wynn — participated in the round.

Celebrity hacking clouds Apple's upcoming product launch (Reuters)
Apple has often displayed uncanny timing, with its well-orchestrated end-of-year iPhone releases. But the leak of racy celebrity photos in the past few days put the company in the unusual position of having to mend its image just days before a highly anticipated Sept. 9 product launch. Nude photos of Hollywood celebrities, including Oscar-winning actress Jennifer Lawrence, posted on Internet forums by unknown hackers has sparked condemnation from stars and their publicists, and prompted an investigation by the Federal Bureau of Investigation. In the wake of the breach, cybersecurity experts and mobile developers have called out inadequacies in Apple’s and, more generally, cloud-services security. Thousands have taken to Twitter to express their frustrations with the company. Some security experts faulted Apple for failing to make its devices and software easier to secure through two-factor authentication, which requires a separate verification code after users log in initially. The process requires several steps and more than rudimentary knowledge of a phone's workings.

2 Economic Reports Point to Strengthening 3rd Quarter (NYT)
American manufacturing activity hit its highest point in nearly three and a half years last month and construction spending rebounded strongly in July, providing further signs that the economy entered the third quarter on strong footing. The upbeat data, released on Tuesday, added to reports on employment and housing that have suggested growth remains sturdy, despite a slowdown in consumer spending in recent months. “Things continue to fall into place for our view that growth should accelerate in the year’s back half,” said Dan Greenhaus, chief strategist at BTIG, an institutional brokerage firm.

Passion on the Playa: The Best Burning Man Missed Connections (Daily Intel)
"I lost you at burning man, w4m - w4m - 30: Your name is David, your playa name goblin? You said you chose it yourself. You live in SF, you grew up as Christian. We met at the bar in the deep playa- they ran out of cocktails. We rode to robot heart together and then you went to get a smoke and I couldn't find you again. Me: dressed in a belly dancing outfit and something on top to warm me up. Long wavy hair. Please find me again.

Liquidity Rules Coming to Wall Street (WSJ)
The new liquidity rules, the first of which will be voted on by the Federal Reserve and the Federal Deposit Insurance Corp. Wednesday, are aimed at preventing the kind of funding crises that helped topple Bear Stearns and Lehman Brothers. But they could alter Wall Street in fundamental ways, including depressing earnings and crimping lending. The rules will require firms to load up on ultrasafe assets, which analysts warn may create a drag on banks' earnings since those assets deliver lower returns. Industry officials and other observers say the rules may also lessen banks' appetite for lending when the economy strengthens, since the firms are diverting money they might otherwise lend.

Netflix Reaches Global Licensing Pact With Warner Bros. for 'Gotham' (WSJ)
Netflix has struck a deal with Time Warner Inc.'s Warner Bros. to secure streaming rights in the U.S. and international markets for "Gotham," a TV show that tells of the city before Batman, and is one of the fall's most anticipated new dramas, according to people familiar with the matter. The deal, which grants Netflix rights to the show in all of the streaming service's territories around the world, is the latest in a series of high-profile content acquisitions by the company. Netflix is looking to complement its growing roster of original programming and win rights to popular shows in overseas markets as it undertakes an expansion in Europe. Netflix, for example, also has rights in international territories to "Better Call Saul," a prequel to AMC's "Breaking Bad" that will air next year. Last month, Netflix won the streaming rights to "The Blacklist," a high-rated NBC drama.

Under Armour inks deals with Gisele Bundchen (NYP)
The move is the latest in Under Armour’s aggressive campaign to lure fitness-obsessed women away from rivals, including down-on-its-luck Lululemon. The Baltimore-based retailer’s shares rose more than 4 percent to $71.13 on the Tuesday announcement, adding nearly $600 million to its market capitalization. Over the past 12 months, Under Armour’s stock has nearly doubled, giving the company a market value of more than $15 billion. Bündchen, who reportedly raked in $47 million in modeling gigs and endorsements last year, is joining the high-paid ranks of Under Armour endorsers — which happens to include her husband, Tom Brady.

Why a Breakup of Citigroup Is Still a Good Idea (Dealbook)
Now cleaned up and well capitalized, Citi’s market capitalization is about $160 billion – though any loyal shareholders are still nearly 90 percent worse off than in 2005. And the bank continues to be prone to the stumbles that have proved characteristic since Sanford I. Weill, Mr. Prince’s predecessor, stitched the behemoth together. This year, for example, Citi revealed an embarrassing fraud at its big Mexican subsidiary, Banamex. Although not material to Citi’s capital, the $400 million swindle rekindled concerns that the bank’s sprawl makes it too complex to manage. That’s one reason the Federal Reserve subsequently thwarted Citi’s plans to increase its dividend. Slicing Citi into more manageable pieces would be one way to soothe regulators at home and abroad, not to mention American taxpayers fearful of another bailout in the future.

Snoop Dogg stops by Chicago couple's wedding, poses with bride and groom (NYDN)
After Neesha Ghadiali and and Joe Scheller tied the knot at the Hard Rock Hotel Chicago, their wedding photographer, who works for Allusion Photography, caught sight of Snoop Dogg exiting a limo. When Scheller’s mother told the photographer she was “Snoop’s biggest fan,” the shooter approached a member of the star's entourage to request that Snoop come by and say hello, Sherry Hagerman, the president of the photography company, told the Daily News. “They had a great conversation and a ton of laughs inside the bar,” she said. “Snoop was a blast to be around, and a really great person for making the day of Neesha and Joe a bit more special.”