Frontrunning: July 5
- Egypt Girds for Muslim Brotherhood Protests (WSJ)
- SAC Capital's Steven Cohen Expected to Avoid Criminal Charges (WSJ)
- SAC insider-trading probe could last years (Reuters)
- RBI seen selling dollars around 60.59 levels: dealers (Reuters)
- China signals will cut off credit to rebalance economy (Reuters)
- Egypt army arrests key Muslim Brotherhood figures (BBC)
- Rise in Steel Prices Alarms Buyers (WSJ)
- Draghi-Carney Seek Independence Day Break From Bernanke (BBG)
- Samsung Warns Results Will Miss Forecasts (WSJ)
- Russia Prosecutor Seeks 6 Years in Jail for Putin Critic Navalny (BBG)
Overnight Media Digest
* The leader of Egypt's military ousted President Mohammed Morsi from office and replaced him with the head of the country's constitutional court-a move the presidential palace quickly branded a "complete military coup.
* Egypt's swift political turn cast sudden scrutiny on the country's new interim president - Adly Mansour, the head of Egypt's Supreme Constitutional Court, a position he assumed just two days earlier.
* The Obama administration's surprise decision to delay penalties for some employers who don't offer health insurance led to a new debate Wednesday over whether the move could undermine efforts to expand access to health insurance for individuals.
* The Securities and Exchange Commission has frozen the assets of a group of unnamed traders who earned $4.6 million in potentially illegal profits by trading in Onyx Pharmaceuticals Inc before the cancer drug-maker rejected an unsolicited acquisition offer from rival Amgen Inc
* Portuguese political leaders worked to preserve the country's strained governing coalition late Wednesday, after the resignations of a pair of key ministers touched off a deep swoon in European financial markets and hinted at a reawakening of the euro zone's debt crisis.
* Four months after Samsung Electronics launched the Galaxy S4 smartphone, brokerages are downgrading the company's stock and cutting their shipment and earnings forecasts, noting that sales of Samsung's high-end smartphone are expected to be disappointing based on component orders placed for the third quarter.
* Two gauges of the labor market showed steady, if unspectacular, strength Wednesday, ahead of a payroll report Friday that could signal the immediate future of one of the Federal Reserve's easy-money policies.
* The Food and Drug Administration plans to issue a new rule by September that would allow generic-drug companies to make changes in their labeling, a step that could open the generic drug makers up to liability if their drugs injure patients.
* Stadium food vendor Aramark Corp is preparing to return to the public markets with an initial public offering, according to people familiar with the company's thinking, paving the way for one of the country's largest closely held companies to return to public ownership.
Both the European Central Bank and the Bank of England on Thursday gave markets guidance on low future interest rates.
New car sales in Britain posted their sixteenth straight monthly increase in June as strong consumer confidence fuelled private demand.
Former UBS trader Tom Hayes, at the center of a global probe into the manipulation of Libor, will indicate how he wishes to plead to eight criminal charges as early as October.
The Labour party's election coordinator, Tom Watson, quit his post on Thursday in a dispute over an attempt by union Unite to influence candidate selection.
Barclays Chief Executive Antony Jenkins has sought to mend ties with regulators after appearing last week to threaten to cut lending if they persisted with new leverage demands.
Two ex Rolls-Royce employees in the United States are challenging a court order holding them back from releasing information which, according to them, exposes potentially serious defects in the company's engine manufacturing process.
* Answering critics who said they were running out of ways to promote growth and lending, the European Central Bank and the Bank of England on Thursday did something neither had done before, committing themselves to keeping interest rates low indefinitely.
* After years of lowering book prices, Amazon is offering smaller discounts on some books. Authors and small publishers said this put some books beyond an audience's reach.
* The first Soviet republic to reclaim its independence was Lithuania. But more than two decades later, the energy industry of this European Union member still feels like an outpost of a creaking empire run from Moscow.
* China wants to use Shanghai as a platform for financial overhauls, including interest rate liberalization and full convertibility of China's currency.
* The International Monetary Fund and Pakistan reached a provisional agreement on Thursday on a $5.3 billion bailout package that aims to bolster Pakistan's flagging economy and its perilously low foreign exchange reserves.
* Nestlé and Danone will trim their prices on some infant formula after China began an investigation of price fixing by sellers of the milk.
THE GLOBE AND MAIL
* A man charged in connection with a terrorist plot on Canada Day wrote increasingly vitriolic messages over the past year, including anti-Semitic conspiracy theories and violent threats in defense of Islam. Online messages by John Stewart Nuttall, who was arrested with Amanda Korody on July 1 in Abbotsford, British Columbia, appear to begin in September, 2012, and continue over the following months.
* A memorial garden dedication takes place Sunday at the site of one of Canada's worst aviation disasters, a former farm field that for decades continued to yield bits of human remains and wreckage. On Sunday, July 5, 1970, an Air Canada Flight 621 en route from Montreal to Los Angeles crashed near Toronto's international airport just northwest of the city, killing all 100 passengers and nine crew.
Reports in the business section:
* Prices for cellphone services - including voice and data - have decreased since last year in Canada, a new study says. A typical package of mobile phone services - including voice, text, call display and voice mail features - has fallen by about 13 per cent year over year, said the study, commissioned by Industry Canada and the CRTC.
* Staunch Quebec independentiste Michel Brule announced on Thursday his long-shot candidacy for the November election. The book publisher, writer, and ex-bar owner says he doesn't expect English-speaking Montrealers to vote for him - and says he isn't working to get their support, anyway.
* A young Canadian woman, Tasha Brown, and eight other boaters who were rescued Wednesday far off the coast of Honduras spent days adrift, thinking no one was looking for them, the woman's mother said.
* Alberta is putting its money where its mouth is, agreeing to pay up to C$5 billion ($4.76 billion) over 20 years to get crude to Canada's East Coast.
* Housing sales in the Greater Toronto Area were down by less than 1 percent in June compared with the same month a year ago, while the average selling price was up by 4.7 percent at $531,374, according to a report by Toronto Real Estate Board.
CHINA SECURITIES JOURNAL
- China's central government has earmarked 100 million yuan ($16.3 million) for the development of food safety monitoring projects in 24 regions including Shanxi, Inner Mongolia, Chongqing and Sichuan in 2013, which follows Beijing's recent decision to allocate 2.579 billion yuan for agricultural development loans this year.
SHANGHAI SECURITIES NEWS
- China is studying measures, including an expansion of the property tax pilot programme, setting up of a nationwide information network and a uniform real estate registration system as part of efforts to control home prices in the long run.
- China's A share IPO market will, at the earliest, restart at the end of August, said Zhaofeng, greater China managing partner of international accounting firm Ernst & Young, after discussions with customers.
- Swedish furniture group Ikea has teamed up with Chinese solar firm Hanergy Holdings Group on a grid-connected solar power generation project for all of Ikea stores. The move is part of Ikea's plan to promote energy efficiency and reduce emissions.
- Sales of medium to high-end homes in Shanghai rose significantly in the first half of the year although prices were relatively stable. Purchases of homes costing more than 30,000 yuan per square metre rose 84 percent in the first six months of the year, compared with the period year, according to Shanghai Deovolente Realty Co.
Fly On The Wall 7:00 Am Market Snapshot
African Barrick Gold (ABGLY) upgraded to Buy from Reduce at Nomura
Randgold Resources (GOLD) upgraded to Neutral from Reduce at Nomura
SABMiller (SBMRY) upgraded to Buy from Hold at Societe Generale
Seadrill (SDRL) upgraded to Buy from Neutral at BofA/Merrill
Unilever (UN, UL) upgraded to Buy from Hold at Societe Generale
Zoetis (ZTS) upgraded to Buy from Neutral at BofA/Merrill
Mead Johnson (MJN) downgraded to Equal Weight from Overweight at Morgan Stanley
SAP (SAP) downgraded to Hold from Buy at Deutsche Bank
Brookfield Infrastructure (BIP) sold its 42% interest in Australasian distribution business for about $410M
Acacia Research (ACTG) CEO Paul Ryan to retire, Matthew Vella named successor
- Steel prices (X, AKS) in the U.S. are rising and not necessarily because the market is improving. Unforeseen events have unexpectedly helped boost prices 10% in recent weeks to their highest levels since early January, and have taken an estimated 4% of total U.S. supply off the market in the last three months, the Wall Street Journal reports
- Pressured to find new sources of revenue as ticket prices remain depressed, airlines (AAMRQ, UAL, DAL, JBLU, LUV) for years have been tacking on baggage fees and charging for meals that used to be free. Now, the fees are continuing to multiply and increase, the Wall Street Journal reports
- Telecom Italia (TI) ended contacts with Hutchison Whampoa (HUWHY) on merging their Italian mobile businesses, and will focus on a plan to spin off its fixed-line network, Reuters reports
- GM (GM) is banking on a no-frills "people mover," the Chevrolet Spin, to help it make inroads into the Japanese-dominated Indonesian car sector, one of Asia's hottest auto markets, Reuters reports
- Citigroup (C) won dismissal of a Hong Kong lawsuit by former private banking client Natamon Protpakorn seeking $17.9M for damages from currency bets liquidated when the bank closed her positions, Bloomberg reports
- In the contest to land NBA star Dwight Howard, it’s not just the Houston Rockets versus the Los Angeles Lakers, it’s Comcast (CMCSA) against Time Warner Cable (TWC), giving the winner a boost to their sports networks, Bloomberg reports
Restoration Hardware (RH) files to sell 10M shares of common stock
lululemon (LULU) files automatic mixed securities shelf
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