Top Pre-Market Stories: Macy’s Sues Martha Stewart, Berkshire Hathaway’s Benefit

Deutsche Bank (NYSE:DB) was downgraded last night by JP Morgan from Overweight to Neutral. There are a few reasons for this move. First, the fact that Deutsche Bank would be guaranteed a bailout by the European Central Bank has been diminished, as the ECB has its own refinancing issues to contend with. In addition, JP Morgan believes that Deutsche Bank’s valuation is too high compared to its competitors, and that its risk-reward ratio warrants a downgrade.

Macy’s (NYSE:M) is suing Martha Stewart in the New York Supreme Court. This is because J.C. Penney (NYSE:JCP) purchased a large stake in Martha Stewart Living Omnimedia (NYSE:MSO) in December, and also planned to build Martha Stewart shops within its stores in 2013. However, Macy’s says a 2006 agreement gives Macy’s exclusive rights to Martha Stewart products through 2018.

Berkshire Hathaway (NYSE:BRKA) (NYSE:BRKB) surely will benefit from the Obama Administration’s decision to prohibit the construction of the Keystone oil pipeline from Canada. A State Department analysis concluded that railroads can handle any increased oil production from Canada through 2030. Berkshire Hathaway just purchased Burlington Railroad, which will have more business without the oil pipeline. While any pipeline surely would be a cheaper alternative, this is a contentious political issue.

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