Stocks Catch Cold on Swine Flu Scare

Shares have fallen around the world in early trading Monday as the potential for a global swine flu pandemic rattles investors. Airline stocks have been badly hit, with shares in British Airways dropping 8 percent, the BBC reports. Cruise operator Carnival (CCL) fell 7 percent, and shares in InterContinental Hotels (IHG) were about 5 percent weaker, the Financial Times reports. Quantas and Air China were also hit; so were crude-oil prices, which had been enjoying something of a recovery in recent weeks, Bloomberg reports. One winner was Roche, the company behind the Tamiflu and Relenza anti-flu drugs, which saw its stock rise 4 percent. Market watchers are already having nasty flashbacks to the 2007 SARS epidemic. "The threat of the pandemic will add further weakness to global trade—we saw with SARS tangible percentage points knocked off the [MSCI world equity] index and that was in a buoyant time. Put that in a weaker time and it is likely to be more unpleasant," one analyst told Reuters.

Can Chrysler escape bankruptcy? That's what the teetering automaker and the United Auto Workers are hoping. The two sides agreed tentative concessions to the UAW contract that includes modifications to a collective bargaining agreement and the trust program dedicated to retiree health benefits, CNN Money reports. The union deal is a key component in avoiding filing for bankruptcy, but Chrysler still has to negotiate debt-reduction deals with banks and other secured lenders before a May 1 deadline set by the Treasury Department, the Wall Street Journal reports. The labor deal will increase pressure on banks that don't want to be seen as the bringing down one of the Big Three. "On Friday, the banks softened their stance in the negotiations, offering to trim the $6.9 billion that Chrysler owes them down to $3.75 billion. Previously they had offered only to cut the debt down to $4.5 billion," the WSJ writes. GM (GM), meanwhile, continues to juggle its figures as it prepares to announce its third new business plan in the last four months, the New York Times reports. The plan will probably outline further plant closings and the end of the road for the Pontiac brand. GM's cuts are based on new forecasts that the U.S. auto industry will sell 3.8 million fewer vehicles this year than in 2008, the NYT explains.

Another week, another round in the ongoing Bank of America (BAC) acrimony, and this time it's former Merrill Lynch (MER) top dog John Thain who is hitting back. In an interview with the Wall Street Journal, Thain "claims [BofA] lied about its role in the giant bonuses and losses at [Merrill] that cost Mr. Thain his job in January, after Bank of America bought the troubled brokerage." BofA executives had maintained that a decision to pay nearly $3.62 billion in early bonuses to Merrill employees (ahead of the merger) was Thain's decision alone, but he insists Bank of America Chief Executive Kenneth Lewis agreed in writing that the bonuses could be paid. "Getting fired is one thing. But nobody has the right to say things that they know aren't true," Thain rails to the WSJ. Staying with departures from sullied banks: UBS has "parted company with its head of investment banking" in what the Financial Times says is the "latest sign of the determination of the beleaguered Swiss group’s new management to accelerate the withdrawal from more volatile operations." Jerker Johansson had been in the job for just a year, and the move seems to have been prompted by a broad internal review of UBS's investment banking division.

Will the proposed merger of mega talent agencies William Morris and Endeavor have a Hollywood happy ending, or could it turn into a clash of the titans? the WSJ asks as it profiles a coupling that "could reshuffle the balance of power in the entertainment business." A merged William Morris-Endeavor agency would be a force to reckon with in Hollywood; it could draw on nearly 400 agents and their client rosters (including Adam Sandler, Jack Black, and Russell Crowe) to exact more leverage in negotiating with the television and film studios. Much will depend on how the heads of the two agencies—Ari Emanuel at Endeavor and Jim Wiatt at William Morris—work together. Both men "have larger-than-life reputations in Hollywood, and bringing them under the same roof could add to the combined company's clout, while also raising the possibility for power and personality clashes," notes the WSJ.

Finally, in a week when some digerati claim that Twitter has "jumped the shark" due to its rapid adoption by the cultural mainstream, the WSJ looks at the many companies now experimenting with Twitter for corporate communication and the problems they face. "Blogs and tweets can run afoul of Securities and Exchange Commission regulations on corporate communications. But sanitizing such posts risks hurting credibility with online audiences," it writes.