Frontrunning: April 17
- Boston bomb probe looking at pressure cooker, backpacks (Reuters), Boston Bomb Clues Surface (WSJ) Forensic Investigators Discover Clues to Boston Bombing (BBG)
- China local authority debt ‘out of control’ (FT)
- Gold Wipes $560 Billion From Central Banks as Equities Rally (BBG)... or the same impact a 2% rise in rates would have on the Fed's balance sheet
- More Wall Street leakage: Stock Surge Linked to Lobbyist (WSJ)
- China's bird flu death toll rises to 16, government warns of spread (Reuters)
- Chinese official endorses monetary easing (FT)
- As global price slumps, "Abenomics" risks drive Japan gold bugs (Reuters)
- North Korea rejects US call for talks (FT)
- IMF Renews Push Against Austerity (WSJ)
- India Gains as Gold Plunge Boosts Scope for Rate Cuts (BBG)
- Germany set to approve Cyprus aid (FT)
- Easing Is an Issue as G-20 Meets (WSJ)
- Tesco to Exit U.S. After First Profit Drop in About 20 Years (BBG)
Overnight Media Digest
* Procter & Gamble Co is planning to add weeks to the amount of time it takes to pay its suppliers, a shift that could free up as much as $2 billion in cash for the consumer products giant, people familiar with the matter said.
* Stephen Feinberg and other partners of the private equity firm Cerberus Capital Management LP that put gun manufacturer Freedom Group Inc up for sale after the Newtown, Connecticut school shootings last year are forming a bid for the gun company, although they remain prepared to sell it to a higher bidder, according to people familiar with the matter.
* AMR Corp's American Airlines canceled or delayed at least 1,950 flights after losing access to a key computer system, a hit to the airline's reputation as it prepares for a complicated merger with US Airways Group Inc that poses the risk of similar disruptions.
* The Food and Drug Administration blocked generic versions of the original OxyContin from coming to market late Tuesday, a sign of support that new safeguards with the highly abused pain drug are working.
* A healthcare lobbyist, who is a former congressional aide, provided a key tip to a political-intelligence firm about a coming change in government policy. The firm's subsequent alert to Wall Street clients sparked a surge in trading.
* The head of the Federal Aviation Administration gave the clearest public indication yet that regulators and Boeing Co are progressing toward an end to the three-month worldwide grounding of the company's 787 jet.
* Yahoo Inc's first-quarter profit rose 36 percent, but revenue fell 7 percent from a year earlier as the firm's core online-advertising business deteriorated.
* Intel Corp's bottom line continued to suffer from the sagging personal computer market in the first quarter, but the numbers and the company's outlook for the current period were less gloomy than some analysts feared.
* Proxy adviser Glass Lewis & Co recommended that MetroPCS Communications Inc shareholders vote in favor of a merger with Deutsche Telekom AG owned T-Mobile USA, shifting course after the terms of the deal were improved.
* A Federal Bureau of Investigation raid brought the headquarters of Pilot Flying J, North America's largest truck-stop chain, to a standstill this week. The investigation appears to be part of a broader probe of rebate payments owed to Pilot's trucking customers, Chief Executive Jimmy Haslam III said Tuesday.
Chinese regulators approved Glencore's $64 billion merger with Xstrata after the former said it would sell its Las Bambas copper project in Peru.
An influential advisory group has asked investors in Credit Suisse to block the Swiss bank's plan to issue shares for employee bonuses. As they further investigate Monte dei Paschi di Siena, Italian police have frozen 1.8 billion euros ($2.36 billion) worth of assets belonging to a unit of Nomura Holdings.
The International Monetary Fund told UK Finance Minister George Osborne to consider pursuing a less severe austerity drive in the face of a weak private sector.
Following widespread raids on the homes of Credit Suisse clients, the bank's employees are being investigated for allegedly helping German citizens avoid taxes.
Goldman Sachs Group reported higher-than-expected first-quarter earnings, driven by strong debt underwriting, but warned of a weak deals pipeline.
Dell has eased its strained relations with billionaire Carl Icahn - to a certain degree - by allowing the activist investor to communicate freely with other shareholders. BlackRock noted its investors' return to stock markets, as clients withdrew $2.6 billion from bond funds while contributing a net $34 billion into equities in the first quarter.
The European parliament rejected a proposal to prop up prices in Europe - the world's largest carbon market - in a vote on Tuesday, sending it plunging to a new record low.
* Goldman Sachs Group Inc reported a first-quarter profit of $2.19 billion, or $4.29 a share, up 5 percent from the year-ago period and driven by investment banking and lending, but the bank faces many market and regulatory challenges.
* Fairway's initial public offering got off to a strong start Tuesday evening, with the U.S. grocery chain pricing its shares at $13 each, above the expected range, according to a person briefed on the matter. It raised $177.5 million, valuing the whole company at $536.1 million.
* A judge has approved a settlement between the hedge fund SAC Capital Advisors and securities regulators that allows the firm to pay a $602 million fine to resolve a civil insider trading case without admitting any guilt, but he conditioned his ruling on a pending ruling from the Federal Appeals Court.
* In a major policy move, the Food and Drug Administration said on Tuesday that it would not approve generic versions of the powerful narcotic OxyContin, the painkiller that symbolized a decade-long epidemic of prescription drug abuse.
* After fierce industry lobbying and internal bickering, the Securities and Exchange Commission is moving closer to overhauling the money market fund industry. Just days after Mary Jo White became its chairwoman, the agency's spokesman, John Nester, said on Tuesday that "the staff expects to have something for the commission's consideration in the near future."
* AMR Corp unit American Airlines was forced to ground all of its flights for several hours on Tuesday after a nationwide problem with its computer systems. By late afternoon, its computers were back up and its operation were slowly coming back to life.
* Google Inc is recruiting developers to build apps for its Internet-connected glasses, but it is being unusually restrictive as it slowly introduces the new technology to a wary public.
* A jury in Chicago rejected claims on Tuesday that the orthopedics unit of Johnson & Johnson inappropriately marketed an artificial hip, which the company recalled in 2010.
* The U.S. Justice Department's top antitrust enforcer said on Tuesday that he supported limits on how much of the nation's airwaves a single wireless company could hold, a condition that could keep AT&T Inc and Verizon Communications Inc from bidding on certain blocks of airwaves during auctions
THE GLOBE AND MAIL
* Canadian singer Rita MacNeil, known as Cape Breton's first lady of song, has died at the age of 68. Her website says she died Tuesday night from complications following surgery.
* The federal Conservative government will stop funding the Health Council of Canada created to ensure common standards for healthcare across provinces and territories - a move that critics say will fragment the national system of medicare.
Reports in the business section:
* A group of Alberta municipal politicians and energy companies is urging that more oil and gas be processed in the province, reviving a long simmering debate on how best to leverage the Alberta boom.
The launch of the campaign, dubbed Alberta Plus, included the release of a report by Ronald Schlenker, a senior instructor in economics at the University of Calgary. His report argues that upgrading and refining more of Alberta's petroleum products before exporting them - known as a "value-added" approach - could create 18,000 new jobs and boost the provincial gross domestic product by billions of dollars.
* Alberta regulators have accused Sherry Hagerty, a former employee of Pembina Pipeline Corp, of illegal insider trading, alleging she advised her husband to buy shares of Provident Energy Ltd after she learned her employer was considering a takeover bid for the gas company.
* Four months after bill C-377 was passed by the House of Commons that would require labor unions to disclose detailed financial information, including how much they spend on political activities, it has run into opposition in the Senate.
* The federal government is changing the software on the full-body scanners used to provide security at airports so they no longer produce a complete outline of a traveler's body.
Transport Canada says the new technology, already in use in the United States and the Netherlands, will increase privacy while still ensuring security.
* SNC Lavalin Group Inc is moving to protect its reputation in Algeria, a key market in which it has operated for years despite the threat of terrorist attacks.
Canada's largest engineering firm this week sent an open letter to the media in the North African nation, insisting it is co-operating with law enforcement authorities in several countries that have opened investigations into its business and repeating that anyone who has committed illegal acts should be brought to justice.
* The latest global report card on Canada's economy is cautionary and firm: weaker growth could mean budget balancing efforts and higher lending rates will need to be put on hold.
The outlook for Canada's economy has weakened significantly in the past few months, falling further behind the United States and still below many other industrialized nations.
CHINA SECURITIES JOURNAL
- New loans are expected to fall in April after a sharp rise in March, according to unnamed banking industry insiders.
- A total of 21 listed steel companies had released their annual report by Wednesday. The reports show a total loss of 7.7 billion yuan in 2012 compared with a total profit of 9.8 billion yuan in 2011.
SHANGHAI SECURITIES JOURNAL
- Yi Xianrong, economist at the Chinese Academy of Social Science's Institute of Financial Research, argues in an editorial that the risk from China's shadow banking system has been exaggerated and that shadow banking is an important catalyst for financial innovation.
CHINA BUSINESS NEWS
- China's Public Security Bureau arrested two bond-fund managers for unspecified financial crimes, one from Citic Securities Co Ltd and the other from Wanjia Asset Management.
- The Standing Committee of the National People's Congress will consider a revision to China's consumer protection law when it meets from April 23 to April 25. If approved, it would be the first revision in 20 years.
- The People's Liberation Army has released a "white paper" that contains previously classified information on the strength and composition of its ground, air, and naval forces.
- Over 92 percent of children born outside China's family planning law in Shanghai were children of migrant women, according to the Shanghai Population and Family Planning Commission, which is launching a campaign to combat violations of the law.
- Chinese President Xi Jinping on Tuesday sent condolences to his U.S. counterpart Barack Obama over the bombings at the Boston Marathon.
Fly On The Wall 7:00 am Market Snapshot
AngloGold (AU) upgraded to Buy from Hold at Deutsche Bank
Eagle Bancorp (EGBN) upgraded to Outperform from Market Perform at Keefe Bruyette
Eagle Materials (EXP) upgraded to Buy from Neutral at Longbow
Gold Fields (GFI) upgraded to Buy from Hold at Deutsche Bank
NCR Corp. (NCR) upgraded to Buy from Neutral at Compass Point
Yahoo (YHOO) upgraded to Buy from Neutral at BofA/Merrill
Cirrus Logic (CRUS) downgraded to Buy from Strong Buy at Needham
DreamWorks (DWA) downgraded to Negative from Neutral at Susquehanna
ITC Holdings (ITC) downgraded to Hold from Buy at Deutsche Bank
Pepco Holdings (POM) downgraded to Underperform from Neutral at Credit Suisse
AMC Networks (AMCX) initiated with an Outperform at Bernstein
Ascent Media (ASCMA) initiated with an Overweight at Piper Jaffray
Casey's General Stores (CASY) initiated with a Neutral at Goldman
DISH (DISH) initiated with a Hold at Stifel
DirecTV (DTV) initiated with a Buy at Stifel
Group 1 Automotive (GPI) initiated with a Neutral at Credit Suisse
Qihoo 360 (QIHU) initiated with an Overweight at Barclays
Scripps Networks (SNI) initiated with a Market Perform at Bernstein
SunCoke Energy (SXCP) initiated with a Buy at BB&T
Wesco Aircraft (WAIR) initiated with a Sell at UBS
Workday (WDAY) initiated with an Outperform at Wedbush
lululemon (LULU) initiated with an Overweight at Barclays
Atlas Energy (ATLS) announced Atlas Pipeline's (APL) $1B acquisition of Eagle Ford business
Intel (INTC) said confident in ability to achieve financial growth in 2H13
Rite Aid (RAD) shareholder Jean Coutu Group sold 72.5M shares at $2.20 average
Tesco (TSCDY) confirmed plans to exit U.S.
CSX (CSX) sees EPS growth of 10%-15% through FY15 off FY13 base
Announced 7% quarterly dividend increase to 15c per share and new $1B buyback
AdCare (ADK) said CFO resigned, annual report delayed beyond deadline
American Airlines (AAMRQ) said computer systems “back up and running,” Bloomberg reports
Toyota (TM) announced Toyota, Lexus U.S. hybrid sales account for 1.95M out of 5M global sales
Companies that beat consensus earnings expectations last night and today include:
BNY Mellon (BK), PNC Financial (PNC), WNS Holdings (WNS), Mattel (MAT), Linear Technology (LLTC), United Rentals (URI), Yahoo (YHOO), Interactive Brokers (IBKR), CSX (CSX)
Companies that missed consensus earnings expectations include:
Textron (TXT), First Cash Financial (FCFS), American Midstream Partners (AMID), Boston Private Financial (BPFH), Cathay General (CATY), Badger Meter (BMI), E2open (EOPN), Intel (INTC)
Companies that matched consensus earnings expectations include:
Fulton Financial (FULT)
- BlackRock (BLK) CEO Laurence Fink said tougher regulation could be coming for the $2.6T money-market-fund industry, in which BlackRock is a major player, the Wall Street Journal reports
- Procter & Gamble (PG) plans to add weeks to the time it takes to pay its suppliers, which could free up as much as $2B in cash, sources say. P&G could use that cash to fund investments in new factories overseas or to help pay for stock buybacks. That highlights how America's biggest companies continue to build on the cash management practices they adopted in the wake of the credit crisis, the Wall Street Journal reports
- John Paulson said Dish Network’s (DISH) $25.5B bid for Sprint Nextel (S) is a compelling offer, a vote of confidence that could help Dish beat rival suitor SoftBank Corp. (SFTBF), Reuters reports
- The Swiss government is considering a possible solution to the dispute with the U.S. over Swiss banks accused of helping wealthy Americans evade taxes, Reuters reports
- The Cypriot government plans to sell part of its gold reserves within the next months, a decision that needs to be approved by the country’s central bank, said Finance Minister Haris Georgiades, Bloomberg reports
- European car sales (VLKAY, DDAIF) are falling to a 20-year low after German concerns over the ongoing debt crisis sent demand plunging last month in the region’s biggest economy and removed the main buffer protecting automakers. Q1 deliveries in the region slid 9.7% to a record low 3.1M cars,
- Bloomberg reports
Atlas Pipeline Partners (APL) announces offering of 10.3M common units
Berry Plastics (BERY) files to sell 16.5M shares of common stock for holders
BioScrip (BIOS) announces common stock offering
Boston Private Financial (BPFH) to repurchase preferred stock held by Carlyle Group
ChemoCentryx (CCXI) 5M share Secondary priced at $12.00
CombiMatrix (CBMX) files to sell 452,440 shares of common stock for holders
Fairway Group (FWM) 13.65M share IPO priced at $13.00
Performant Financial (PFMT) files to sell 6.5M shares of common stock
- advertisements -