Monday morning headlines

Stocks sharply higher: Promising news from Europe is behind the early surge. Dow is up 250 points.

European leaders promise to recapitalize: "Everything necessary" will be done to ensure that banks have enough capital, said Germany's chancellor Angela Merkel. She and French president Nicolas Sarkozy say that a comprehensive response to the debt crisis would be finalized by the end of the month. From Bloomberg:

"Maybe they're still running one step behind, but they are at least discussing the right things," said Carsten Brzeski, an economist at ING Group in Brussels. Underscoring the urgency, directors of Franco-Belgian Dexia SA (DEXB) began dismantling the lender, the first victim of the debt crisis at the core of Europe. Belgium announced early today it would pay 4 billion euros ($5.4 billion) to take over the local consumer-lending unit as part of the process.

Netflix abandons spinoff plan: The movie rental service has decided to keep its DVD-by-mail and online streaming services together under one name and one Web site. From the NYT:

Ingrid Chung of Goldman Sachs credited Netflix management for "listening to its customers (finally) and working to fix its relationship with customers." Richard Greenfield, a media analyst for BTIG Capital, said in an email message that Monday's announcement was the "necessary reversal of a bad decision." "The key remaining question," he said, "is why did they make the Qwikster decision in the first place?"

iPhone 4S breaks record: Apple says first-day pre-orders last Friday topped 1 million. (AP)

Big dip in venture financing: Only $1.72 billion was raised in the third quarter, a 53 percent drop from a year earlier and the lowest level since 2003. Investors are worried about the uncertain market for public offerings. (DealBook)

Brown signs Dream Act: The legislation allows illegal immigrants going to the state's public colleges and universities to apply for financial aid and merit-based scholarships. Dream Act supporters will push for illegal immigrants to become eligible for driver licenses. (ABC News)

Slew of bill signings, vetoes: The governor had a busy weekend, acting on tax credits for movie production, alcohol sales at automated checkout stands, and the use of tanning salons. (LAT)

Hotel Bel-Air reopens Friday: After a two-year renovation, only about a dozen employees will be coming back. From the LAT:

"In essence, the dedicated employees who took the Hotel Bel-Air from a four-star to five-star resort have been thrown out like the old furniture," said union President Thomas Walsh. The union plans to fire back with noisy demonstrations and a call on Hollywood actors and directors to boycott the famed hotel. The labor group has already sent out 2,000 postcards warning hotel neighbors to expect a ruckus. "We want to come back to work," the postcard said. "But we've been ignored."

Port of Long Beach acquires trade center: Purchase price of the 27-story building on Ocean Boulevard is $130 million. The sale would be one of the largest in L.A. County this year. (LAT)

More A380s out of LAX: Korean Air will offer three weekly flights aboard the world's largest passenger aircraft between L.A. and Seoul. Daily flights begin Oct. 29. (Daily Breeze)