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Frontrunning: April 30

Tyler Durden's picture




 
  • Headline of the day goes to... Cold weather seen temporarily slowing U.S. economy (Reuters)
  • Americans Want to Pull Back From World Stage, Poll Finds (WSJ)
  • U.S. Plans to Charge BNP Over Sanctions (WSJ)
  • What about Jay Carney: Putin Threat to Retaliate for Sanctions Carries Risks (BBG)
  • Fed expected to take further step toward ending bond buying (Reuters)
  • A Fed-Watcher’s Guide to FOMC Day: Steady Taper, Green Shoots (BBG)
  • Alstom accepts 10 billion euro GE bid for its energy unit (Reuters)
  • BOJ projects inflation exceeding 2 percent, keeps bullish view intact (Reuters)
  • In Drug Mergers, There's One Sure Bet: The Layoffs (WSJ)
  • Orbital Sciences Soars Out of Musk’s Shadow in Space Race (BBG)
  • London Travel May Ease as Subway Commuters Brave Walkout (BBG)

 

Overnight Media Digest

WSJ

* Americans in large numbers want the United States to reduce its role in world affairs even as a showdown with Russia over Ukraine preoccupies Washington, a Wall Street Journal/NBC News poll finds. In a marked change from past decades, nearly half of those surveyed want the United States to be less active on the global stage, with fewer than one-fifth calling for more active engagement. (r.reuters.com/kyv88v)

* Federal prosecutors are planning to criminally charge BNP Paribas SA for doing business with countries subject to U.S. economic sanctions, including Iran, Sudan and Cuba. If the government goes ahead with charges against the parent of the Paris-based bank, it could lead to the first guilty plea by a bank in decades. (r.reuters.com/huv88v)

* French industrial conglomerate Alstom on Wednesday decided to review a 12.35 billion euro ($17.12 billion) acquisition bid made by General Electric for its power equipment division by the end of the month, giving GE a lead over rival Siemens. Alstom's board unanimously acknowledged the "strategic and industrial merits" of the GE offer. (r.reuters.com/suv88v)

* Johnson & Johnson, the largest maker of a device used in a popular uterine surgery, said it has suspended sales of the tools called power morcellators amid concerns about their potential to spread a rare but deadly cancer. (r.reuters.com/jev88v)

* Energy Future, the former TXU, filed for one of the biggest bankruptcies on record, surrendering to a misguided bet on natural-gas prices and a debt load of over $40 billion. (r.reuters.com/puv88v)

* In an unprecedented move, the National Basketball Association commissioner on Tuesday banned the owner of the Los Angeles Clippers from running his team or associating with the league for life, after recordings of his racist comments became public, causing outrage on the court and sending advertisers fleeing. Commissioner Adam Silver also levied a $2.5 million fine against Clippers owner Donald Sterling. (r.reuters.com/kev88v)

* Chinese pork producer WH Group scrapped what could have been the world's biggest initial public offering in a year when investors balked at the high price. The failed IPO stands in contrast to the success eight months ago when WH Group, then known as Shuanghui International Holdings, bought Smithfield Foods in the biggest-ever Chinese acquisition of a U.S. company. (r.reuters.com/xuv88v)

 

FT

France's Alstom accepted General Electric's $12 billion-plus all-cash offer for its energy arm, but the engineering company left the door open for a rival bid from Germany's Siemens.

Barclays will say next week that it is creating a "bad bank", hoping to transform its struggling investment banking operations that were dealt a further blow with the exit of the highly regarded head of its U.S. business.

Russia's state-controlled gas giant Gazprom said it was taking steps to mitigate the impact of possible further Western sanctions as it posted a 7 percent drop in net profit last year.

Twitter's stock fell 11 percent, its lowest since the microblogger's initial public offering, when it failed to overcome a trend of slow user growth, shaking investor confidence that it could ever grow to the size of Facebook .

WH Group has pulled the plug on its $2 billion Hong Kong float after failing to attract sufficient demand, even though the Chinese pork producer had already halved the size of the fundraising last week.

 

NYT

* Americans in large numbers want the United States to reduce its role in world affairs even as a showdown with Russia over Ukraine preoccupies Washington, a Wall Street Journal/NBC News poll finds. In a marked change from past decades, nearly half of those surveyed want the United States to be less active on the global stage, with fewer than one-fifth calling for more active engagement. (r.reuters.com/kyv88v)

* Federal prosecutors are planning to criminally charge BNP Paribas SA for doing business with countries subject to U.S. economic sanctions, including Iran, Sudan and Cuba. If the government goes ahead with charges against the parent of the Paris-based bank, it could lead to the first guilty plea by a bank in decades. (r.reuters.com/huv88v)

* French industrial conglomerate Alstom on Wednesday decided to review a 12.35 billion euro ($17.12 billion) acquisition bid made by General Electric for its power equipment division by the end of the month, giving GE a lead over rival Siemens. Alstom's board unanimously acknowledged the "strategic and industrial merits" of the GE offer. (r.reuters.com/suv88v)

* Johnson & Johnson, the largest maker of a device used in a popular uterine surgery, said it has suspended sales of the tools called power morcellators amid concerns about their potential to spread a rare but deadly cancer. (r.reuters.com/jev88v)

* Energy Future, the former TXU, filed for one of the biggest bankruptcies on record, surrendering to a misguided bet on natural-gas prices and a debt load of over $40 billion. (r.reuters.com/puv88v)

* In an unprecedented move, the National Basketball Association commissioner on Tuesday banned the owner of the Los Angeles Clippers from running his team or associating with the league for life, after recordings of his racist comments became public, causing outrage on the court and sending advertisers fleeing. Commissioner Adam Silver also levied a $2.5 million fine against Clippers owner Donald Sterling. (r.reuters.com/kev88v)

* Chinese pork producer WH Group scrapped what could have been the world's biggest initial public offering in a year when investors balked at the high price. The failed IPO stands in contrast to the success eight months ago when WH Group, then known as Shuanghui International Holdings, bought Smithfield Foods in the biggest-ever Chinese acquisition of a U.S. company. (r.re* Federal prosecutors are nearing criminal charges against some of the world's biggest banks, according to lawyers briefed on the matter, a development that could produce the first guilty plea from a major bank in more than two decades. In doing so, prosecutors are confronting the popular belief that Wall Street institutions have grown so important to the economy that they cannot be charged. (r.reuters.com/duv88v)

* The TXU Corp, the Texas energy giant that was taken over in a record-shattering buyout in 2007, finally collapsed into a long-awaited bankruptcy early Tuesday. On the surface, the long, slow decline of the company, renamed Energy Future Holdings , has caused few ripples, though it is the state's largest electricity generator and provides power to 3 million customers. (r.reuters.com/fuv88v)

* British bank Barclays Plc said that Hugh McGee, head of its business in the United States, will leave on Wednesday, becoming the latest in a series of senior executives to depart in the last two years. (r.reuters.com/guv88v)

* Wal-Mart Stores Inc plans to add a new consumer service to its arsenal of offerings on Wednesday, teaming up with a website that helps customers to review prices at several insurance companies and contrast them with their current auto insurance. (r.reuters.com/juv88v)

* In an effort to end what he sees as another way into borrowers' accounts, Benjamin M. Lawsky, New York State's top financial regulator, is sending cease-and-desist letters to 20 companies suspected of making illegal payday loans, 12 of which appear to use debit card information to do so. (r.reuters.com/kuv88v)

* In a pair of unanimous decisions, the Supreme Court on Tuesday made it easier for the winning side in patent cases to recover its legal fees from the loser. The decisions were welcomed by some technology companies, which said the rulings would help address what they say are abusive and coercive lawsuits brought by "patent trolls," or companies that buy patents not to use them but to collect royalties and damages. (r.reuters.com/zuv88v)ters.com/xuv88v)

 

China

CHINA SECURITIES JOURNAL

- Sources told reporters that new detailed standards regarding the regulation of IPOs, in particular pertaining to underwriting, subscription processes and private equity should be released in the near future.

- Profits in a total of 2,473 listed companies hit 2.24 trillion yuan ($357.94 billion) in 2014, rising 14.68 percent from a year earlier, Wind Information data showed.

SHANGHAI SECURITIES NEWS

- Profits at listed Chinese companies beat expectations in 2013, rising over 14 percent.

SHANGHAI DAILY

- The Supreme Court ruled that all parole and early-release hearings involving officials imprisoned for graft must be open to the public.

 

Britain

The Telegraph

ROLLS-ROYCE IN TALKS WITH SIEMENS OVER SALE OF GAS TURBINE BUSINESS

Siemens is in talks to buy Rolls-Royce's gas turbine and compressor business for 900 million pounds ($1.52 billion), but the German firm looks set to miss out on Alstom's energy assets. (http://link.reuters.com/cet88v)

CO-OP DISMISSES BOARD MEMBER FOLLOWING LEAKS

The Co-operative Group has dismissed one of its board members following a series of leaks which led to the departure of former Chief Executive Euan Sutherland. (http://link.reuters.com/bet88v)

SCOTTISH INDEPENDENCE WILL TRIGGER MASS EXODUS OF FINANCIAL SERVICES

Scottish households will see a double-digit decline in living standards if the country votes to become independent, as secession triggers a mass exodus of the financial services industry, according to a respected think-tank. (http://link.reuters.com/zys88v)

'UK SHOULD GET OUT OF THE EU,' SAYS FORMER FRENCH PM

Britain should leave Europe because it is killing the European Union dream, a former French Prime Minister has said. In a blistering attack, Michel Rocard, a grandee of the French Socialist Party who served as premier under Francois Mitterrand, identified Britain as the source of all the EU's problems.

CUBA ACCUSES UK OF BEING ANTI-CAPITALIST OVER PLAIN PACKAGING PLANS

Cuba has accused Britain of being anti-capitalist and threatening free trade with its plans introduce plain packaging on cigarettes and cigars. (http://link.reuters.com/kat88v)

The Guardian

BARCLAYS' MOST SENIOR BANKER IN U.S. TO LEAVE

Barclays most senior banker in the U.S. is to leave, triggering fears of an exodus of staff as the business prepares for another restructuring of its controversial investment banking arm. (http://link.reuters.com/wat88v)

VINCE CABLE REBUTS CLAIM GOVERNMENT MASSIVELY UNDERVALUED ROYAL MAIL

Vince Cable has continued to contest claims that the government significantly undervalued Royal Mail, costing taxpayers 750 million pounds on the day of the postal service was privatised in October. (http://link.reuters.com/zat88v)

ANGLO IRISH BANK PAIR AVOID PRISON DESPITE BEING FOUND GUILTY

Two former Anglo Irish Bank executives have been spared jaily despite being found guilty of handing out illegal loans from the financial institution at the heart of Ireland's economic collapse. (http://link.reuters.com/xat88v)

STING OF ZERO-HOURS CONTRACTS REVEALED

Almost three in 10 people on zero-hours contracts are unable to work as many hours as they would like, according to a study, which shows that many of the UK's lowest paid people are gaining little benefit from the accelerating recovery. (http://link.reuters.com/vat88v)

The Times

PFIZER RAMPS UP PRESSURE AS ASTRA BID WINS SUPPORT

The head of Pfizer has jetted into London to begin a whistlestop tour of City institutions as the U.S. drugs company scrambles to drum up support for a hostile 58.7 billion pound takeover of AstraZeneca. (http://link.reuters.com/det88v)

LABOUR WANTS LAW CHANGE TO BLOCK HOSTILE TAKEOVERS

Britain's Labour party is examining changes to the law to give company boards greater powers to block hostile foreign takeovers. Chuka Umunna, the shadow business secretary, wants greater powers to "stop the rush" towards takeovers amid the unfolding attempt by Pfizer, the U.S. pharmaceutical giant, to snap up AstraZeneca. (http://link.reuters.com/qat88v)

 

 

Fly On The Wall 7:00 AM Market Snapshot

ECONOMIC REPORTS

Domestic economic reports scheduled today include:
ADP employment report for April at 8:15--consensus 210K
Q1 real GDP at 8:30--consensus up 1.1%
Chicago business barometer for April at 9:45--consensus 56.9
FOMC meeting announcement at 14:00

ANALYST RESEARCH

Upgrades

Aspen Technology (AZPN) upgraded to Buy from Hold at Summit Research
Beazer Homes (BZH) upgraded to Buy from Neutral at Sterne Agee
Cerner (CERN) upgraded to Buy from Neutral at UBS
Compass Minerals (CMP) upgraded to Overweight from Neutral at JPMorgan
El Paso Pipeline (EPB) upgraded to Neutral from Underperform at BofA/Merrill
Highwoods Properties (HIW) upgraded to Buy from Hold at Stifel
Parker-Hannifin (PH) upgraded to Equal Weight from Underweight at Morgan Stanley
Pioneer Energy (PES) upgraded to Buy from Hold at Wunderlich
S&T Bancorp (STBA) upgraded to Outperform from Market Perform at Keefe Bruyette
Semiconductor Manufacturing (SMI) upgraded to Buy from Neutral at BofA/Merrill
StanCorp (SFG) upgraded to Equal Weight from Underweight at Morgan Stanley
Texas Capital (TCBI) upgraded to Buy from Hold at Deutsche Bank
Trinity Biotech (TRIB) upgraded to Buy from Neutral at Roth Capital
Waddell & Reed (WDR) upgraded to Outperform from Market Perform at Keefe Bruyette
Xylem (XYL) upgraded to Buy from Hold at Stifel

Downgrades

ABB (ABB) downgraded to Neutral from Buy at BofA/Merrill
ABB (ABB) downgraded to Sector Perform from Outperform at RBC Capital
AGCO (AGCO) downgraded to Neutral from Overweight at Piper Jaffray
ARM Holdings (ARMH) downgraded to Neutral from Buy at Citigroup
Cloud Peak (CLD) downgraded to Market Perform from Outperform at BMO Capital
Coach (COH) downgraded to Neutral from Buy at Citigroup
Corning (GLW) downgraded to Neutral from Overweight at HSBC
Dresser-Rand (DRC) downgraded to Underweight from Equal Weight at Morgan Stanley
eBay (EBAY) downgraded to Neutral from Overweight at Atlantic Equities
MarkWest Energy (MWE) downgraded to Equalweight from Overweight at Barclays
Nordstrom (JWN) downgraded to Hold from Buy at McAdams Wright
Orbital Sciences (ORB) downgraded to Hold from Buy at KeyBanc
Regional Management (RM) downgraded to Market Perform from Outperform at BMO Capital

Initiations

Aflac (AFL) assumed with a Market Perform at Keefe Bruyette
Michael Kors (KORS) initiated with a Buy at Janney Capital
Navient (NAVIV) initiated with a Buy at Compass Point
Sallie Mae Bank (SLMVV) initiated with a Buy at Compass Point

COMPANY NEWS

Exelon (EXC) to acquire Pepco Holdings (POM) for $27.25 per share in cash
GE (GE) offered $13.5B enterprise value to acquire businesses of Alstom Thermal (ALSMY)
Alstom (ALSMY) says 'considering' acquisition of Energy unit by GE (GE)
Twitter (TWTR) reported monthly active users 255M as of March 31
eBay (EBAY) announced that it repatriated $9B worth of cash, on which it took a $3B charge in Q1
Southern Company (SO) to take $380M charge in Q1 for cost of Kemper County plant
Microsoft (MSFT), BesTV to bring Xbox One to China in September
Auxilium (AUXL) cut its FY14 revenue view to $380M-$420M from $450M-$490M, consensus $484.11M, and cut its net income view to ($15M)-$0 from $45M-$50M

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
eBay (EBAY), Twitter (TWTR), Wi-LAN (WILN), Pinnacle Entertainment (PNK), Barrick Gold (ABX), Hyatt Hotels (H), WellPoint (WLP), ICON plc (ICLR), Euronet (EEFT), Flushing Financial (FFIC), Aegion (AEGN), RF Micro Devices (RFMD), Genworth (GNW), SM Energy (SM), Green Plains (GPRE), Panera Bread (PNRA), HCC Insurance (HCC), Silicon Image (SIMG), Trinity Industries (TRN), Concur (CNQR), NuVasive (NUVA), Aspen Technology (AZPN), GFI Group (GFIG), C.H. Robinson (CHRW), Dun & Bradstreet (DNB), Nanometrics (NANO), RenaissanceRe (RNR), Cascade Microtech (CSCD), M/A-COM (MTSI), Marriott (MAR), Columbia Sportswear (COLM), U.S. Steel (X), RPX Corp. (RPXC), LogMeln (LOGM), Dolby (DLB), Anika Therapeutics (ANIK), Owens-Illinois (OI), EXCO Resources (XCO), National Instruments (NATI), Hanover Insurance (THG), Rex Energy (REXX), Riverbed (RVBD), Calix (CALX),  Newfield Exploration (NFX), Huron (HURN), SolarWinds (SWI), EZCORP (EZPW), Blackstone Mortgage (BXMT), Cray (CRAY), Fiserv (FISV),  Dynamic Materials (BOOM), Seagate (STX), Edison International (EIX), Plantronics (PLT)

Companies that missed consensus earnings expectations include:

DreamWorks Animation (DWA), AMC Entertainment (AMC), Ingredion (INGR), Carlyle Group (CG), Olympic Steel (ZEUS), Regis (RGS), ClickSoftware (CKSW), Exelon (EXC), Allot Communications (ALLT), AXIS Capital (AXS), Heritage Oaks (HEOP), Watts Water (WTS), Virtus Investment Partners (VRTS), First Financial Bancorp (FFBC), Willis Group (WSH), FEI Company (FEIC), Usana (USNA), Franklin Electric (FELE), Corporate Executive Board (CEB), Cloud Peak (CLD), ZELTIQ (ZLTQ), CAI International (CAP), Power Integrations (POWI), Vistaprint (VPRT), Trulia (TRLA), Vanguard Natural (VNR), Town Sports (CLUB), Cempra (CEMP)

Companies that matched consensus earnings expectations include:
Radware (RDWR), AudioCodes (AUDC), Timmins Gold (TGD), Mueller Water (MWA), Correction: Celadon Group (CGI), Inphi (IPHI), TECO Energy (TE), Ikanos (IKAN), Verisk Analytics (VRSK), HFF Inc. (HF), Bravo Brio Restaurant (BBRG), Epiq Systems (EPIQ), Big 5 Sporting (BGFV), Chemed (CHE), Express Scripts (ESRX), Acadia Healthcare (ACHC)

NEWSPAPERS/WEBSITES

U.S. close to filing criminal charges against large banks (BNPQY, CS), NY Times says
Sanofi (SNY) working with Evercore on drug sale, Reuters reports
Morgan Stanley (MS) planning a retail banking push, FT reports
GE (GE) bid of over $12B for Alstom (ALSMY) energy assets accepted, WSJ reports
GE (GE) says discussions with France on Alstom (ALSMY) offer 'productive,' Reuters says
Sotheby's (BID) board members agreed with Loeb's critiques, WSJ says
Bayer (BAYRY) offers assets, cash for Merck (MRK) OTC unit, Bloomberg says

SYNDICATE

CAI International (CAP) files to sell 3M common shares for holders
Enstar Group (ESGR) files to sell 2.61M ordinary shares for holders
HD Supply (HDS) files to sell 30M shares of common stock for holders
Liquid Holdings (LIQD) files to sell 10M shares of common stock for holders
Seaspan (SSW) files to sell 3.63M common shares for holders
Wet Seal (WTSL) files to sell 28.61M common shares for holders
ePlus (PLUS) 1.573M share Secondary priced at $50.00

 

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Wed, 04/30/2014 - 07:53 | 4711279 Infinite QE
Infinite QE's picture

Americans Want to Pull Back From World Stage

 

Ha. Don't they realize that THEY don't have a voice? It really is time to get the 200 or so people who are running this show into a boat, send it out into the ocean and sink it.

Wed, 04/30/2014 - 08:28 | 4711344 svayambhu108
svayambhu108's picture

Americans in large numbers want the United States to reduce its role in world affairs even as a showdown with Russia over Ukraine

That's impossible, is not befetting giving up on weapons of mass distraction.

 

Wed, 04/30/2014 - 07:58 | 4711286 El Hosel
El Hosel's picture

Gee Wally, Do you think precious Metals will get slammed ahead of the FOMC?

http://finviz.com/futures_charts.ashx?t=SI&p=d1

Wed, 04/30/2014 - 08:09 | 4711304 Heiman Van Rock...
Heiman Van Rockerchild's picture
Senate committee okays Stanley Fischer for federal reserve.

"Fischer is a dual US-Israeli citizen who until last year served as the governor of Israel's central bank."

"The 70-year-old was also deputy managing director at the International Monetary Fund, from 1994 to 2001, and prior to that served as chief economist for the World Bank."

"The paper made Fischer a central figure in New Keynesian economics."(aka market rigging!)

"He is a member of the Bilderberg Group and attended the Swiss 2011 Bilderberg conference in St. Moritz, Switzerland."

Is it any more clear. "Give me control of a nation's money and I care not who makes it's laws" -- Mayer Amschel Bauer Rothschild.

The political systems and infrastructure of the world is now in control by a few, they are waging war on the people of the world. If the people do not stand up and resist we are doomed. It doesn't take much to extrapolate what is in store for the people.

Wed, 04/30/2014 - 08:11 | 4711307 Edward1290
Edward1290's picture

the world has gone mad...............

''A piece of Texas could become the "new Israel" if one US politician has his way, claiming that all sides in this type of deal would win. Congressional candidate Allan Levene is proposing to create a second entity of Israel on the eastern coast of the southern state, Texas. He has high hopes of calling the place "new Israel."
Read more: http://voiceofrussia.com/2014_04_30/US-politician-wants-to-create-New-Israel-state-in-Texas-claims-all-sides-will-win-4215/
Wed, 04/30/2014 - 08:12 | 4711314 Its_the_economy...
Its_the_economy_stupid's picture

words escape me

Wed, 04/30/2014 - 08:31 | 4711354 q99x2
q99x2's picture

Green Shoots for Obama's impeachment.

Wed, 04/30/2014 - 10:59 | 4712032 bagehot99
bagehot99's picture

Green shoots five years into a recovery is pretty uplifting too; I'm saying BUY

Wed, 04/30/2014 - 08:41 | 4711368 dizzyfingers
dizzyfingers's picture

http://cnsnews.com/commentary/patrick-j-buchanan/treating-putin-pariah  On Treating Putin as Pariah

""the demonization of Putin is not a policy. It is an alibi for the absence of one."

Do NOT follow this link or you will be banned from the site!