Frontrunning: October 3
- No Joy on Wall Street as Biggest Banks Earn $63 Billion (Bloomberg)
- And more good news: IMF’s Blanchard Says Crisis Will Last a Decade (Reuters)
- Hobbit Returns to Find Middle Earth Has Become Expensive (Bloomberg)
- Freddie's Foreclosure Plan Hits Roadblock (WSJ)
- Who will buy the FT? Pearson CEO Scardino Will Step Down as Fallon Takes Over (BBG)
- Jeremy Lin Said to Be in Talks With Harvard on Licensing Deal (Bloomberg)
- Jon Weil tears apart the NYAG "prosecution" - Eric Schneiderman Will Have to Do Better Than This (BBG)
- Portugal Offers to Exchange Bonds as It Seeks Debt Market Access (Bloomberg)
- Is unlimited growth a thing of the past? (FT-Martin Wolf)
- European Bank Capital Results Overtaken by Tougher Global Rules (Bloomberg)
- China’s Slowdown Reverberates as ADB Cuts Forecasts (Bloomberg)
- Tokyo has no plan to extend currency swap deal with Seoul (Reuters)
Overnight Media Digest
BLOW FOR BRITAIN'S NUCLEAR REVIVAL
A Franco-Chinese consortium has walked away from the race to build Britain's new generation of nuclear reactors.
MILIBAND INVOKES 'ONE NATION BRITAIN'
Britain's opposition leader Ed Miliband cast himself as a humble man of the people on Tuesday in a confident speech at the Labour party conference.
US STEPS UP PROBES ON INSIDER TRADING
U.S. authorities have increased the number of new investigations into insider trading by almost half in the past year.
FSA TO TIGHTEN UP LISTING RULES
Rules aimed at cracking down on dominant shareholders and reverse takeovers have been set out by the City of London watchdog.
DEUTSCHE TELEKOM EYES DEAL FOR US UNIT
Deutsche Telekom is in talks about merging its T-Mobile USA subsidiary with rival MetroPCS.
L&G INVESTMENT ARM TARGETS PAY MASTERS
Legal & General has stepped up efforts to crack down on excessive pay by voting against 18 remuneration committee chairmen.
PE GROUPS EYE BANK DEAL IN EUROPE
Blackstone has set up a joint venture for financial services deals with London-based Anacap Financial Partners.
EU REVIEW WANTS BANKING TRADING RINGFENCED
Europe's biggest banks must detach their risky trading activities from their retail operations, according to conclusions of an EU review.
EU DRAFT URGES CONTRACTS FOR EURO STATES
Euro zone countries would have to sign binding contracts with Brussels, committing them to detailed fiscal reform, according to a draft EU agenda.
FRENCH REVOLT AGAINST NEW TAX GOES VIRAL
French President Francois Hollande faced divisions in his party on Tuesday over a 2013 budget crucial to his credibility with euro zone partners.
* The parent company of T-Mobile USA, the struggling cellphone service provider, is in talks to buy MetroPCS Communications Inc as it fights to compete against two bigger rivals.
* Autos in the United States flew off the lot at the highest sales rate in four years in September, adjusted for seasonal variations, according to the research firm Autodata.
* Spain's 17 regional governments agreed to stick to budget deficit targets set by the central government, giving Prime Minister Mariano Rajoy some breathing space.
* Facebook Inc Chief Operating Officer Sheryl Sandberg told marketers the company was focused on proving the promise of advertising.
* A European Union panel recommended banks be forced to split traditional lending from riskier trades as a way to safeguard the financial system.
* In an address to the nation after a 40 percent fall in the value of Iran's currency over the last week, Mahmoud Ahmadinejad said his country was facing a "psychological war" waged by the United States.
* Better Place, an electric vehicle infrastructure company, said on Tuesday that it had replaced Shai Agassi, its charismatic chief executive and founder, with Evan Thornley, the company's top executive in Australia.
THE GLOBE AND MAIL
* British Columbia Premier Christy Clark has issued a veiled threat to withhold electricity needed to operate controversial oil sands pipelines if the projects do not meet her demands.
* The plan to share buildings for British and Canadian embassies in the future has sparked criticism from those who accuse Ottawa of merging its diplomatic brand with Britain - and questions about whose flag would fly over shared embassies.
Reports in the business section:
* The federal government eliminated the approval of 30-year amortization periods on government-backed mortgages in June - and the decision's impact can now be seen most vividly in the cooling off of Greater Vancouver's market, with sales falling for everything from entry-level homes to luxury houses, Bank of Montreal senior economist Sal Guatieri said Tuesday.
* A group of disabled former Nortel employees who saw their benefits slashed after the company's demise have filed a lawsuit seeking $60-million from the two trust companies charged with administering the onetime telecommunications giant's health fund.
* The 35-acre former Molson Brewery site, once home to Barrie, Ontario's biggest employer, and later the country's largest indoor grow-op, worth an estimated $8.9 million, sits fallow, ragweed sprouting up in the former parking lots.
It is owned by Fercan Developments Inc, whose principal is Toronto property developer Vince DeRosa. But federal prosecutors assert the property is the proceeds of crime; a forfeiture hearing, with its goal of seizing it for the Crown, is under way this week in Newmarket, Ontario.
* Nearly a year after Ontario's air ambulance service descended into scandal, interim president Ron McKerlie says Ornge has stepped "out of the shadows."
Since late last year, Ornge has grappled with a series of revelations about generous executive perks, chronic understaffing, inadequate equipment and excessive delays.
* Air Canada unveiled its plans Tuesday for a new integrated leisure group made up of its Air Canada Vacations division and its new low-cost carrier.
* Automakers reported another strong month of sales in September with cars and trucks flying off dealership lots across the country at near historic highs. Carlos Gomes, Scotiabank senior economist, said the overall market for autos grew 6 percent year-over-year in Canada in September led by a 12 percent surge in sales for import brands.
European economic update:
- Sweden Services PMI 47.3 – lower than expected. Consensus 50.3. Previous 50.8.
- Spain Services PMI 40.2 – lower than expected. Consensus 42.0. Previous 44.0.
- Italy Services PMI 44.5 – higher than expected. Consensus 44.0. Previous 44.0.
- France Services PMI 45.0 – lower than expected. Consensus 46.1. Previous 46.1.
- Germany Services PMI 49.7 – lower than expected. Consensus 50.6. Previous 50.6.
- Euro Area services PMI 46.1 – higher than expected. Consensus 46.0. Previous 46.0.
- Euro Area Composite PMI 46.1 – higher than expected. Consensus 45.9. Previous 45.9.
- UK Services PMI 52.2 – lower than expected. Consensus 53.0. Previous 53.7.
Fly On The Wall 7:00 AM Market Update
American Axle (AXL) upgraded to Outperform from Sector Perform at RBC Capital
Assurant (AIZ) upgraded to Buy from Neutral at Goldman
CSX (CSX) upgraded to Market Perform from Underperform at Bernstein
DineEquity (DIN) upgraded to Buy from Neutral at Janney Capital
Norfolk Southern (NSC) upgraded to Market Perform from Underperform at Bernstein
Thoratec (THOR) upgraded to Buy from Neutral at UBS
Ann Inc. (ANN) downgraded to Neutral from Buy at SunTrust
Embraer (ERJ) downgraded to Neutral from Outperform at Cowen
Express (EXPR) downgraded to Neutral from Buy at SunTrust
Heartland Payment (HPY) downgraded to Sell from Hold at Stifel Nicolaus
Hill-Rom (HRC) downgraded to Equal Weight from Overweight at Morgan Stanley
Mosaic (MOS) downgraded to Neutral from Buy at Lazard Capital
Nationstar Mortgage (NSM) downgraded to Neutral from Buy at Sterne Agee
Potash (POT) downgraded to Neutral from Buy at Lazard Capital
Texas Instruments (TXN) downgraded to Sector Perform from Outperform at Pacific Crest
Aegerion (AEGR) initiated with an Overweight at JPMorgan
Agree Realty (ADC) initiated with a Buy at Wunderlich
Allegheny Technologies (ATI) initiated with a Buy at Longbow
Avago (AVGO) initiated with a Buy at Capstone
Broadcom (BRCM) initiated with a Buy at Capstone
Brookdale Senior Living (BKD) initiated with a Buy at Deutsche Bank
Capital Senior Living (CSU) initiated with a Buy at Deutsche Bank
EQT Midstream Partners (EQM) initiated with a Buy at Citigroup
Emeritus (ESC) initiated with a Buy at Deutsche Bank
Five Star Quality (FVE) initiated with a Buy at Deutsche Bank
Health Care REIT (HCN) initiated with an Outperform at RBC Capital
Lorillard (LO) initiated with a Buy at CLSA
Marvell (MRVL) initiated with a Hold at Capstone
Michael Kors (KORS) initiated with an Outperform at William Blair
NXP Semiconductors (NXPI) initiated with a Buy at Capstone
NeoGenomics (NGNM) initiated with a Buy at B. Riley
O'Reilly Automotive (ORLY) initiated with an Overweight at Stephens
PerkinElmer (PKI) initiated with an Overweight at JPMorgan
Westport Innovations (WPRT) initiated with a Buy at UBS
Oracle (ORCL) CEO Ellison told CNBC not planning any major acquisitions like NetApp (NTAP)
KBR (KBR) awarded Statoil (STO) contract to conduct LNG studies in Tanzania
Mylan (MYL) sued FDA for approval of generic version of Diovan, Bloomberg reported
Boeing (BA) said air cargo market will expand at 5.2% annual rate over next 20 years
Carlyle Group (CG) purchased 55% stake in Vermillion
CBIZ (CBZ) acquired The Pruett Group
AB Volvo (VOLVY) Buses consolidates manufacture of complete buses in Europe
Companies that beat consensus earnings expectations last night and today include:
Companies that missed consensus earnings expectations include:
Apple's (AAPL) Asian component suppliers have started mass production of a new tablet computer smaller than the current iPad, sources say, as the company tries to stay competitive against rivals such as Google (GOOG) and Amazon.com (AMZN), the Wall Street Journal reports
Shipments of beer in the U.S. are increasing for the first time since 2008 in another sign that consumers are slowly emerging from the recession. Much of the rebound is being driven by small-batch "craft'' brewers, reflecting shifting tastes and forcing dominant players Anheuser-Busch InBev (BUD) and MillerCoors (TAP) to increasingly borrow from upstarts' playbooks. Beer shipments in the U.S. were up 1.9% to 141.4M barrels in the first eight months of 2012 after falling three straight years, according to the Beer Institute, an industry group, the Wall Street Journal reports
Best Buy (BBY) founder Richard Schulze and at least four private equity firms have started examining the books of the consumer electronics chain, early steps toward what could become a potential $11B buyout, sources say, Reuters reports
Carlyle Group (CG) said it bought a majority stake in Vermillion Asset Management, a commodities-trading hedge fund manager with about $2.2B of assets under management,
its biggest move in an expansion that has seen it diversify from private equity into other alternative asset classes, Reuters reports
BlackRock (BLK) CEO Laurence D. Fink, who has been trying to persuade retail investors to get out of cash, said the U.S. is about a year away from having a more robust economy, Bloomberg reports
The government of Macau won’t issue any licenses for new U.S. companies to operate casinos, predicted Gary Loveman, CEO of Caesars Entertainment Corp. (CZR), Bloomberg reports
Antares Pharma (ATRS) files to sell common stock, no amount given
Apollo Commercial (ARI) files to sell 7M shares of common stock
B&G Foods (BGS) 3.63M share Secondary priced at $30.25
BioLineRx (BLRX) files to sell 4.2M American Depositary Shares for holders
Javelin Mortgage (JMI) 7.25M share IPO priced at $20.00
LifeLock (LOCK) 15.7M share IPO priced at $9.00
Luxfer (LXFR) 8M share IPO priced at $10.00
NY Mortgage Trust (NYMT) commences offering of 13.5M shares of common stock
Rigel Pharmaceuticals (RIGL) announces common stock offering, no amount given
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