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Pre-Market Primer: Bundesbank Spars With ECB Over Bond Purchases


The Germans would prefer that individual governments did the heavy lifting rather than the ECB.

MINYANVILLE ORIGINAL Stock futures are little changed today ahead of the bell, as no major economic indicators are due to come out today.

In Europe, the German Bundesbank voiced its opposition to the European Central Bank's plan to buy sovereign bonds from Spain and other eurozone countries to bring down borrowing costs and reduce the spread between German and peripheral countries' bond yields.

"Decisions on whether to share solvency risks much more widely should be taken by governments and parliaments," the German central bank wrote in a report.

Meanwhile, Spain is asking for a commitment from the ECB that it will carry through the sovereign purchases before it looks for help itself. Despite expectations that Spain will be seeking a fresh bailout soon, the country's 10-year bond yields dropped 21 basis points to 6.23%.

European and Asian stocks rallied, and US equity futures were mixed. Futures on the Dow (^DJI) declined by 0.16% to 13,226.00 and S&P 500 (SPY) futures fell 0.08% to 1,414.00. Nasdaq (^IXIC) futures gained 0.11% to 2,779.00.

Best Buy (BBY) has appointed Hubert Joly to replace interim CEO Mike Mikan. Joly, who is currently serving as CEO of Carlson Restaurants, has a reputation for turning around struggling companies. Best Buy's stock fell over 4% this morning.

Lowe's (LOW) reported a 10% drop in earnings in the second fiscal quarter. The company lowered its forecast for the year's earnings to $1.64 per share from $1.73-$1.83. Same-store sales fell 0.4%. Home Depot reported a 2.1% increase in sales over the same period.

Aetna (AET), the commercial health care giant, said today that it will acquire Coventry Health Care (CVH) for $5.7 billion in cash and equity. Coventry is a major supplier of of Medicare and Medicaid care, which is expected to be in greater demand as the baby boomer generation retires.

Twitter: @vincent_trivett
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