Wednesday morning headlines

Stocks open sharply lower: More turbulence this morning as investors try wrapping their arms around a very confused market. Dow is down 330 points.

Today it's France: Quelle horreur! President Nicolas Sarkozy returns to Paris in August, so you know it's serious. Problem is too much debt and overly optimistic forecasts. (WSJ)

Stock drop hits state budget hard: That's because so much of California's tax revenues are dependent on wealthy individuals - and they've been losing lots of money on Wall Street. If revenues fail to meet projections, the state will have to make further cuts in December. (Sacramento Bee)

Improving jobs picture: Chapman University's employment index is expected to increase in the third quarter to over 100, indicating positive jobs growth. But economist Esmael Adibi still expects a double-digit unemployment rate. (OC Register)

Disney tops earnings expectations: Television did well (especially ESPN), movies did poorly, and theme parks remain a question mark. (AP)

Gundlach to testify in high-profile case: At issue is whether the former high flier of L.A. money management firm TCW stole confidential data and proprietary trading systems from their old employer in order to start a competing firm. (NYT)

Murdoch to answer questions: We'll see how much he talks about phone-hacking during the News Corp. conference call early this afternoon. Company will be releasing earnings today. (All Things Digital)

Visa pushing for chips: The credit card servicer says that the old magnetic strip is not secure enough. But retailers are pushing back because chips are more expensive. From the WSJ:

The debate over chip-enabled cards has been a chicken-and-egg issue for years. Many merchants say they don't want to invest in the new technology if banks won't issue the cards. The banks, meanwhile, say they don't want to invest in the cards because newer technology, such as mobile-device payments, will leapfrog the need for the chip-enabled plastic.

THQ lays off 200: The Agoura Hills-based video game company is closing two studios in Australia and cutting back at another one in Phoenix. Sales of THQ's newly released titles fell far short of expectations. (LAT)

CIM buys Old Spaghetti Factory building: The Hollywood developer is planning a retail, office and residential project city officials had approved for the previous owners, Washington Real Estate Holdings. LAT says the transaction is valued at $20 million..

Grocery workers plan protest: They'll be at three Ralphs stores today in anticipation of another strike authorization vote. The contract covering Southern California grocery workers expired in March. (NBCLA)