NEW YORK (Reuters) - Discover Financial Services Inc (DFS.N: Quote, Profile, Research, Stock Buzz), the fourth-biggest U.S. credit card company, and card networks Visa Inc (V.N: Quote, Profile, Research, Stock Buzz) and MasterCard Inc (MA.N: Quote, Profile, Research, Stock Buzz) have settled an antitrust lawsuit, a court official and MasterCard said on Tuesday, sending Discover's shares up over 16 percent.
In 2004, Discover had filed a lawsuit against MasterCard and Visa seeking roughly $6 billion in damages, as it contended the card networks had harmed its business by preventing their member banks from issuing credit cards for Discover's network.
Visa and MasterCard had already agreed to settle a similar lawsuit with American Express Co (AXP.N: Quote, Profile, Research, Stock Buzz) for about $3.9 billion.
A clerk for Judge Barbara Jones in U.S. District Court in Manhattan said she had no details other than that the parties had reached a settlement. Jury selection starting on Tuesday for a trial before Jones had been canceled.
"MasterCard Inc today confirmed that it has reached an agreement in principle to settle its outstanding litigation with Discover Financial Services Inc," said MasterCard's spokeswoman Sharon Gamsin. "The parties are working on settlement documentation; details of the terms of the settlement will follow."
Representatives for Visa and Discover could not immediately be reached for comment.
U.S. courts have ruled that efforts by Visa and MasterCard, the world's two biggest credit card companies, to restrict banks from working with rivals was anti-competitive and broke antitrust law.
Shares of Discover jumped 16.7 percent to $12.37, while Visa stock was down 2.9 percent to $57.14 and MasterCard was off 0.2 percent to $173.19 in late morning trading on the New York Stock Exchange.
(Reporting by Grant McCool, additional reporting by Martha Graybow and Juan Lagorio; editing by Gerald E. McCormick)
source:. http://www.reuters.com/article/marketsNews/idUSN1432271920081014
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Tuesday, October 14, 2008
Short-selling "vital" to markets - new WFE head
MILAN, Oct 14 (Reuters) - Short-selling is a "vital" tool for markets and should not be demonised, the incoming chairman of the group representing the world's exchanges said on Tuesday.
"Short-selling is recognised as a viable and vital (instrument) of the market," William Brodsky, who is also chief executive of the Chicago Board Options Exchange (CBOE), told a news conference.
Speaking after a two-day meeting of the World Federation of Exchanges (WFE), Brodksy cited panic and confusion sown by the global financial crisis for the recent bans on the short-selling of certain stocks in a number of countries.
"We must be very careful not to demonise short-selling," he said. "It is a very important part of a complicated market structure."
Investors short sell a company's shares by selling borrowed shares in the hope their price will fall. They then buy back those shares more cheaply to make a profit.
Bank and financial stocks have been among those that have suffered the most from short-selling in recent months and bans have been imposed to stop their free-fall in several countries.
In the United States, the ban on more than 950 companies with business in financial services expired last week.
The Securities and Exchange Commission (SEC) and the Nasdaq (NDAQ.O: Quote, Profile, Research, Stock Buzz) and the New York Stock Exchange (NYX.N: Quote, Profile, Research, Stock Buzz) markets are considering a temporary ban on short-selling a particular stock if it falls by more than a certain percentage, a source briefed on the matter told Reuters on Oct. 10.
The WFE's outgoing chairman, Massimo Capuano, head of Borsa Italiana, told the news conference he understood the need for the ban for exceptional situations.
Ahead of its meeting in Milan on Sunday, the WFE, whose members account for more than 97 percent of world stock market capitalization, issued a statement saying market trading must not be suspended as a way to cope with the crisis.
It later welcomed the coordinated effort by industrialised countries to recapitalise banks and implement other measures to safeguard the stability of the global financial system.
"The WFE wants to be a strong contributor in the solution for the crisis," Brodksy said.
(Reporting by Gilles Castonguay and Sabina Suzzi; Editing by Andrew Macdonald)
source:. http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSLE35629120081014?pageNumber=2&virtualBrandChannel=0
"Short-selling is recognised as a viable and vital (instrument) of the market," William Brodsky, who is also chief executive of the Chicago Board Options Exchange (CBOE), told a news conference.
Speaking after a two-day meeting of the World Federation of Exchanges (WFE), Brodksy cited panic and confusion sown by the global financial crisis for the recent bans on the short-selling of certain stocks in a number of countries.
"We must be very careful not to demonise short-selling," he said. "It is a very important part of a complicated market structure."
Investors short sell a company's shares by selling borrowed shares in the hope their price will fall. They then buy back those shares more cheaply to make a profit.
Bank and financial stocks have been among those that have suffered the most from short-selling in recent months and bans have been imposed to stop their free-fall in several countries.
In the United States, the ban on more than 950 companies with business in financial services expired last week.
The Securities and Exchange Commission (SEC) and the Nasdaq (NDAQ.O: Quote, Profile, Research, Stock Buzz) and the New York Stock Exchange (NYX.N: Quote, Profile, Research, Stock Buzz) markets are considering a temporary ban on short-selling a particular stock if it falls by more than a certain percentage, a source briefed on the matter told Reuters on Oct. 10.
The WFE's outgoing chairman, Massimo Capuano, head of Borsa Italiana, told the news conference he understood the need for the ban for exceptional situations.
Ahead of its meeting in Milan on Sunday, the WFE, whose members account for more than 97 percent of world stock market capitalization, issued a statement saying market trading must not be suspended as a way to cope with the crisis.
It later welcomed the coordinated effort by industrialised countries to recapitalise banks and implement other measures to safeguard the stability of the global financial system.
"The WFE wants to be a strong contributor in the solution for the crisis," Brodksy said.
(Reporting by Gilles Castonguay and Sabina Suzzi; Editing by Andrew Macdonald)
source:. http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSLE35629120081014?pageNumber=2&virtualBrandChannel=0
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