Frontrunning: May 28
- Yellen Concerned by Housing Slowdown She Has Scant Power to Cure (BBG)
- Because snow in Q1? Citigroup’s CFO Says Trading Revenue Could Slide 25% (BBG)
- Banks Raise Caution Flag on Trading (WSJ)
- The answer is yes: Hilsenrath asks if BOJ’s Kuroda Awakening to His Limits? (WSJ)
- Google Develops Prototype Cars for Fully Autonomous Driving (WSJ)
- Amazon Expects Lengthy Hachette Dispute (WSJ)
- Ukraine Faces Hurdles in Restoring Its Farming Legacy (NYT)
- Tencent $1 Billion Game Shows Global Hunt for Mobile Hits (BBG)
- GE offer for Alstom has improved, French official says (Reuters)
- More than 50 rebels killed as new Ukraine leader unleashes assault (Reuters)
- To Make a Killing on Wall Street, Start Meditating (BBG)
Overnight Media Digest
* Google Inc's co-founder Sergey Brin said it has developed prototype cars for fully autonomous driving. In a promotional video, Google showed off one of the prototypes, a two-seater vehicle that resembles a gondola on wheels. It has no steering wheel, accelerator pedal or brake pedal. Instead, the car relies on its own sensors and software to do the work. (http://r.reuters.com/nan69v)
* General Electric Co is willing to partner with French government in a possible alliance, Chief Executive Jeffrey Immelt told French lawmakers Tuesday as he tried to win their support for the company's $17 billion bid for Alstom SA's power equipment business. (http://r.reuters.com/san69v)
*Pilgrim's Pride Corp swooped in with a $5.5 billion offer for Hillshire Brands Co, maker of Jimmy Dean sausage and Ball Park hot dogs, a surprise bid that could upend Hillshire's plan to expand its supermarket sway by buying Pinnacle Foods Inc. (http://r.reuters.com/van69v)
* After a turbulent few months marked by a management shake-up, lackluster performance and client withdrawals, Pacific Investment Management Co is turning to a familiar face to help soothe nervous investors. The money manager, based in Newport Beach, California, said it had rehired Paul McCulley, a former senior executive. (http://r.reuters.com/wan69v)
* Amazon.com Inc said Tuesday it does not expect a quick resolution of a contract dispute with Hachette Book Group that has led to Amazon restricting the sale of some Hachette titles. (http://r.reuters.com/xan69v)
* Congress should require data brokers to tell consumers more about how they collect and use information and give consumers greater control over their personal data, the Federal Trade Commission said on Tuesday. (http://r.reuters.com/zan69v)
Google could face specially created "cyber courts" as Berlin looks at a range of mechanisms to settle disputes concerning individuals seeking to protect their privacy and search engines.
Spanish government failed to protect citizens from recent housing crash because of which many are left with heavy debts, according to a report by Human Rights Watch, an international non-governmental organization.
Britain's fraud office has launched a formal criminal investigation into GlaxoSmithKline, posing a new challenge to the drugmaker, which already faces claims of bribery in China and four other countries.
Siemens said it was preparing to make an official bid for for Alstom SA, and defeat rival offer by General Electric, in its bid to create two European leaders in power generation and rail.
M&G, the investment unit of Prudential Plc, and ING Investment Management rank among the insurers leading a push in real estate investment as both the companies pump millions into the property market.
* Restoring Ukraine's farming legacy will be crucial to the success of the country's newly elected president, Petro Poroshenko, as such efforts would go a long way toward fixing Ukraine's economy and reducing its dependence on Russia. (http://r.reuters.com/fym69v)
* The Federal Trade Commission on Tuesday called on Congress to protect consumers against the unchecked collection and sharing of their digital data by providing people with tools to view, suppress and fix their information. (http://r.reuters.com/hym69v)
* Google Inc has begun building a fleet of 100 experimental electric-powered vehicles that will dispense with all the standard controls found in modern automobiles. (http://r.reuters.com/kym69v)
* After Mohamed El-Erian's surprising departure in March, Pimco has now brought back a prominent former executive, Paul McCulley, to help the asset management firm reassure skeptical investors and bolster its intellectual credentials. (http://r.reuters.com/rym69v)
* Since 2000, the Securities and Exchange Commission has sought to ensure equal access to that commodity through a rule known as Regulation FD. The rule generally requires that if a company disclosed material information to one person, it must do so to all. Yet even with that requirement and with the flood of information that is out there, some investors still appear to be getting premier access. (http://r.reuters.com/tym69v)
* The World Bank, a famously bureaucratic institution, is undergoing its first restructuring in nearly two decades. The overhaul is intended to keep it relevant at a time when even the poorest countries can easily tap the global capital markets. (http://r.reuters.com/gen69v)
* A task force convened by the Obama administration issued the most detailed study yet of blight in Detroit on Tuesday and recommended that the city spend at least $850 million to quickly tear down about 40,000 dilapidated buildings. (http://r.reuters.com/hen69v)
THE GLOBE AND MAIL
* A candidate in the Alberta Progressive Conservative leadership race is promising to change land-use rules that have angered some rural voters. Jim Prentice told the Medicine Hat News that he would rewrite the Land Stewardship Act if he becomes premier and would be more careful about private property rights. (http://r.reuters.com/dep69v)
* Skin cancer, one of the most preventable forms of the disease, is also one of the fastest-rising in Canada, according to a new report from the Canadian Cancer Society that notes the death rate for all cancers combined continues to fall for most age groups. (http://r.reuters.com/cep69v)
Reports in the business section:
* Royal Bank of Canada, the country's largest mortgage lender, is offering real estate agents C$1,000 for referring five first-time home buyers, as competition among banks for first-time buyers has heated up. (http://r.reuters.com/fep69v)
* Toronto Liberal Member of Parliament John McKay was secretly recorded criticizing party leader Justin Trudeau over his edict that prospective MPs must follow the party's pro-choice position on abortion. (http://r.reuters.com/qep69v)
* Councillor Doug Ford indicated on Tuesday that his brother, Toronto Mayor Rob Ford, intends to stay in the mayoral race when he returns from addiction treatment. (http://r.reuters.com/zep69v)
* It is becoming increasingly difficult for families to own a home in Canada and affordability is expected to get worse going forward, according to the Royal Bank of Canada. (http://r.reuters.com/kup69v)
* Canada's biggest financial institutions have agreed to voluntarily reduce service costs for those that need to save the most following discussions with a federal government eager to push its "consumers-first agenda". (http://r.reuters.com/pup69v)
CHINA SECURITIES JOURNAL
- Zhou Xiaochuan, governor of the People's Bank of China (PBOC), said the economy was in an "unusually intricate" situation and local branch offices needed to implement a prudent monetary policy to ensure economic stability and strengthen financial regulation.
- Song Liping, general manager of Shenzhen Stock Exchange, said the exchange would continue to promote and extend China's ChiNext board.
21st CENTURY BUSINESS HERALD
- Miao Jianming, president of China Life Insurance (Group) Co, said the company was going to get licences to start payment, securities and financial services, paving the way for the firm to become a full-fledged financial services company.
SHANGHAI SECURITIES NEWS
- Data from the China Insurance Regulatory Commission showed investments by insurers into stocks and equity funds reached 822 billion yuan ($131.6 billion) in the first four months of this year, accounting for just 10 percent of their total investment portfolio, which is a one-year low.
- The government will release a detailed list of administrative fees for micro-sized and small enterprises as it seeks to alleviate the financial burden of a group of companies that are a source of economic dynamism, an official said on Tuesday.
- Shanghai plans to establish 8-10 smart parks with top-class technologies such as cloud computing and Big Data by 2015 as it looks to lead the sector nationwide, the city's information technology regulator said.
- Stabilising and developing Xinjiang is the primary goal, the newspaper said in a commentary.
BARCLAYS: INDEPENDENT SCOTLAND LIKELY TO GET NEW CURRENCY
An independent Scotland would be twice as likely to adopt its own currency as continue using the pound, according to an analysis produced yesterday by Barclays for its investors.
M&S'S SWANNELL HIRED TO OVERSEE GOVERNMENT ASSET SALES
Robert Swannell, the chairman of Marks & Spencer and City veteran, has been hired to help the Government speed up the sale of billions of pounds of state assets.
MORRISONS ASKS SUPPLIERS TO PAY FOR PRODUCTS TO MEET REGULATIONS
Morrison Supermarkets Plc is asking suppliers to cover the cost of ensuring products meet regulations in the latest of a series of payment demands as the supermarket faces falling profits.
UK CINEMA CHAINS BAN ADS ON SCOTTISH INDEPENDENCE REFERENDUM
The UK's major cinema chains have banned all adverts on the Scottish independence referendum after customers inundated them with complaints.
RIO TINTO CUTS MONGOLIAN MINING JOBS
Rio Tinto is planning to cut about 300 jobs from its troubled project in Mongolia, further testing its turbulent relationship with the government.
TSB PARKS ITS TANK ON THE BIG BANKS' LAWN
The chief executive of TSB Banking Group <IPO-TBS.L> declared that his company would do more to change the face of high street banking in Britain than any other challenger bank as he set out ambitious expansion plans in the wake of its 1.5 billion pound flotation next month.
NATIONWIDE BIG WINNER FROM SEVEN-DAY SWITCH
Britain's biggest building society Nationwide will emerge on Wednesday as one of the principal winners from a new system designed to encourage customer mobility when it discloses that it opened more than 420,000 current accounts last year.
MORTGAGE APPROVALS DECLINE FOR THIRD MONTH
High street banks have reduced the number of mortgage approvals for the third month in a row, despite their total value reaching a six-year high. The British Bankers' Association said 12.2 billion pounds in loans were activated in April.
Fly On The Wakk 7:00 AM Market Snapshot
No major domestic economic reports are scheduled today.
Auxilium (AUXL) upgraded to Buy from Neutral at MKM Partners
DreamWorks Animation (DWA) upgraded to Hold from Sell at Topeka
FormFactor (FORM) upgraded to Buy from Neutral at B. Riley
The Pantry (PTRY) upgraded to Outperform from Neutral at Macquarie
Twitter (TWTR) upgraded to Buy from Neutral at Nomura
Vince Holding (VNCE) upgraded to Buy from Hold at KeyBanc
Williams-Sonoma (WSM) upgraded to Overweight from Neutral at Piper Jaffray
Dollar General (DG) downgraded to Hold from Buy at Deutsche Bank
Live Nation (LYV) downgraded to Neutral from Buy at Sterne Agee
Lowe's (LOW) downgraded to Sell from Hold at Canaccord
Nautilus (NLS) downgraded to Neutral from Buy at B. Riley
Vodafone (VOD) downgraded to Hold from Buy at Berenberg
Coca-Cola Enterprises (CCE) initiated with a Neutral at ISI Group
Delek US (DK) initiated with a Buy at BofA/Merrill
Nimble Storage (NMBL) initiated with a Neutral at Macquarie
Veeva (VEEV) initiated with an Overweight at JPMorgan
Waste Management (WM) initiated with an Outperform at Imperial Capital
Valeant (VRX) raises proposal for Allergan by $10.00 per share to $58.30 per share; adds new CVR related to DARPin sales which would provide up to approximately $25.00 per share of additional value
Valeant (VRX) to sell filler, toxin assets to Nestle (NSRGY) for $1.4B in cash
LoJack (LOJN) CFO Donald Peck to leave the company; Casey Delaney named Acting CFO
PetroLogistics (PDH) agrees to be acquired by Flint Hills for $14.00 per unit
Sanofi (SNY), Eli Lilly announce licensing agreement for Cialis OTC
Workday (WDAY) sees Q2 revenue $173M-$178M, consensus $171.5M
Qihoo 360 (QIHU) sees Q2 revenue $300M-$305M, consensus $270.18M
MiMedx (MDXG) raises lower end of Q2 revenue view to $22.5M-$23.5M from $21.5M-$23.5M
FormFactor (FORM) raises Q2 revenue guidance to $65M-$69M from $62M-$66M
Wet Seal (WTSL) sees Q2 adjusted EPS (9c)-(12c), consensus (4c)
Companies that beat consensus earnings expectations last night and today include:
Toll Brothers (TOL), Seadrill (SDRL), Qihoo 360 (QIHU), Workday (WDAY)
Companies that missed consensus earnings expectations include:
America's Car-Mart (CRMT)
Companies that matched consensus earnings expectations include:
Wet Seal (WTSL)
Apple (AAPL) expected to announce purchase of Beats for $3B this week, NY Post says
Broadcom (BRCM) extends market share to 49% in worldwide STB market, DigiTimes says
Facebook (FB) asks for EU review of WhatsApp deal, WSJ reports
GE (GE) sweetens bid for Alstom with job pledge, Reuters says
Google (GOOG) unveils self-driving car without steering wheel, Re/code reports
Microsoft (MSFT) CEO says not selling search to Yahoo, Re/code reports
Pfizer (PFE) looks like a buy after dropping bid for AstraZeneca, Barron's says
Xerox (XRX) beats out HP for $500M NY Medicaid contract, Bloomberg says
3D Systems (DDD) announces offering of 5.95M shares of common stock
ARAMARK (ARMK) launches 20M share common stock offering for holders
BioCryst (BCRX) files to sell $100M in common stock
Brookdale (BKD) announces secondary offering by affiliates of Fortress Investment
Cache (CACH) commences public offering of $14M of common stock
Health Care REIT (HCN) files to sell 1.8M shares of common stock
Installed Building (IBP) files to sell 8.1M shares of common stock for holders
Rexnord (RXN) launches 15M share common stock offering for holders
Strategic Hotels (BEE) commences 34M share common stock offering
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