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Frontrunning: September 20

Tyler Durden's picture




 
  • Obama, Romney tiptoe around housing morass as they woo voters (Reuters) ... just as ZH expected
  • Poll Finds Obama in Better Shape Than Any Nominee Since Clinton (Bloomberg)
  • Romney on Offense, Says Obama Can’t Help Middle Class (Bloomberg)
  • Fed’s Fisher Says U.S. Inflation Expectations Rising (Bloomberg)
  • Citigroup Warns Irish Investors to Plan for Losses (Bloomberg)
  • Central Banks Flex Muscles (WSJ)
  • China says U.S. auto trade complaint driven by election race (Reuters)
  • Brussels sidesteps China trade dispute (FT)
  • How misstep over trading fractions wounded ICAP's EBS (Reuters)
  • Ex-CME programmer pleads guilty to trade secret theft (Reuters)
  • Income squeeze will persist, says BoE (FT)
  • South African miners return to work, unrest rumbles on (Reuters)
  • Indians strike against reform plans (FT)
  • High $A puts AAA rating at risk (AFR)

Overnight Media Digest

WSJ

* Bank of America Corp is accelerating a broad cost-cutting plan and has set a target of shedding 16,000 jobs by year's end - cuts that would see the company relinquish its title as U.S. banking's largest employer.

* U.S. prosecutors are seeking more time to complete their investigation of alleged interest-rate fixing, while banks ensnared in the probe are trying to turn the clock to their advantage as they battle lawsuits claiming damages from rate-rigging.

* Google Inc is expected to surpass rival Facebook Inc in selling online "display" advertisements in the U.S. this year, according to a new estimate by research firm eMarketer Inc.

* Nasdaq OMX Group Inc defended its plan to compensate firms that say they lost money in the Facebook stock-market debut, firing back at objections by UBS AG , Citigroup Inc and others to the exchange's proposal.

* Liberty Global Inc is poised to launch a tender offer for the nearly 50 percent of Telenet Group Holding NV that it doesn't already own, according to people familiar with the matter, in a deal that would value the Belgian cable company at roughly $5.2 billion.

 

FT

ROSNEFT SEEKS $15 BILLION FOR BP MOVE

Rosneft is seeking $15
billion in financing for a potential deal to buy a 50 per cent stake in
BP's troubled Russian oil venture.

RULING BOOSTS FIGHT AGAINST TAX AVOIDANCE

The
government has won an important legal victory in its fight against
stamp duty avoidance, in a blow to similar schemes used to dodge an
estimated 170 million pounds ($275.79 million) of tax.

BRUSSELS SIDESTEPS CHINA TRADE DISPUTE

The
European Union has stalled a controversial trade case against Chinese
telecommunications companies, defusing a row with Beijing on the eve of
Premier Wen Jiabao's last summit with European leaders.

BAE-EADS DEAL ON SUMMIT AGENDA

Francois
Hollande and Angela Merkel will seek to agree a joint position on
Saturday on the 35 billion euro combination of EADS and BAE Systems to
create the world's largest defence and aerospace company by revenue.

UK IN PUSH TO RELAX TECH LISTING RULES

A
push to make it easier for high-growth companies to list in London will
be launched by the government on Thursday in an attempt to bolster the
capital as Europe's technology hub.

UKRAINE AGREES $3 BILLION LOAN-FOR-CORN DEAL

Ukraine
is set to sign an unusual loan-for-crops contract with China that will
see Kiev access $3 billion in credit lines in exchange for supplies of
corn, a commodity that Beijing has started to import in large
quantities.

BANKS TO CHARGE LESS ON DIRECT LINE IPO

Banks
handling the flotation of Royal Bank of Scotland's insurance arm are to
charge less than normal as they seek to breathe life into a moribund
market for stock market launches.

TESCO CHIEF STANDS BY U.S. ARM FRESH & EASY

Philip
Clarke, chief executive of Tesco, appeared to stand by its lossmaking
U.S. business as the head of Britain's biggest retailer pledged to lead a
"revolution" in online retailing.

 

NYT

* On Wednesday, Apple Inc released a software update for the iPhone that, among other changes, replaces the Google Inc maps that have been on the phone since 2007 with Apple's own maps.

* The chief executive of BP Plc, Robert Dudley, met with President Vladimir Putin of Russia in an effort to resolve a long-running business dispute in Russia.

* Continuing its foray into new lines of business, Starbucks Corp is introducing a single-cup coffee machine that will allow consumers to make their own lattes at home with real milk.

* The European Commission said on Wednesday that it was prepared to drop its investigation into the fixing of e-book prices by Apple and four European publishers after the companies agreed to let online retailers like Amazon.Com Inc sell e-books at a discount for two years.

 

Canada

THE GLOBE AND MAIL

* The Canadian economy may still be in the doldrums, but a three-year freeze on salaries for members of Parliament and senators is set to expire in just five months.

* A leading conservation group has recruited a phalanx of well-known Canadians to join its fight against the proposed Northern Gateway pipeline, in a bid to counter past claims by the Harper government that many pipeline opponents are "radical" activists.

Reports in the business section:

* Most Canadians have paid cash in order to avoid the sting of taxes - and they don't feel bad about it either, according to a new poll.

NATIONAL POST

* The accused killer who allegedly ruined the Parti Quebecois election-night celebration surfaced again Wednesday - speaking out from his jailhouse just as the new government was being sworn in.

FINANCIAL POST

* Next to the debate generated across Canada by the proposed takeover of oil producer Nexen Inc by CNOOC Ltd, Thursday's special shareholders meeting in Calgary to approve the transaction is expected to be a matter of only a few words.

European Economic Summary:

  • France Flash Manufacturing PMI 42.6 – lower than expected. Consensus 46.4. Previous 46.0.
  • France Flash Services PMI 46.1 – lower than expected. Consensus 49.5. Previous 49.2.
  • Germany Flash Manufacturing PMI 47.3 – higher than expected. Consensus 45.2. Previous 44.7.
  • Germany Flash Services PMI 50.6 – higher than expected. Consensus 48.5. Previous 48.3.
  • Euro Area Flash Manufacturing PMI 42.6. Previous 46.0.
  • Euro Area Flash Services PMI 46.1 – lower than expected. Consensus 49.5.Previous 49.2.
  • UK Retail sales Ex Autos -0.3% m/m 3.1% y/y. Previous 0.0% m/m and 3.3% y/y.

Fly on the Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

Adobe (ADBE) upgraded to Outperform from Sector Perform at RBC Capital
American Water (AWK) upgraded to Conviction Buy from Neutral at Goldman
Cellcom Israel (CEL) upgraded to Equal Weight from Underweight at Barclays
DreamWorks (DWA) upgraded to Neutral from Sell at Janney Capital
Limited (LTD) upgraded to Outperform from Neutral at Credit Suisse

Downgrades

AMCOL International (ACO) downgraded to Neutral from Buy at Sterne Agee
AllianceBernstein (AB) downgraded to Underperform from Neutral at BofA/Merrill
Citigroup (C) downgraded to Neutral from Buy at UBS
Clean Harbors (CLH) downgraded to Neutral from Outperform at RW Baird
Coach (COH) downgraded to Neutral from Outperform at Credit Suisse
EnerNOC (ENOC) downgraded to Hold from Buy at Capstone
GT Advanced (GTAT) downgraded to Sector Perform from Outperform at Pacific Crest
Goldman Sachs (GS) downgraded to Neutral from Buy at UBS
Iconix Brand (ICON) downgraded to Hold from Buy at Benchmark Co.
Internap (INAP) downgraded to Sector Perform from Outperform at RBC Capital
Kenexa (KNXA) downgraded to Market Perform from Outperform at Raymond James
Marriott (MAR) downgraded to Neutral from Overweight at JPMorgan
Morgan Stanley (MS) downgraded to Neutral from Buy at UBS
NV Energy (NVE) downgraded to Neutral from Buy at Goldman
Norfolk Southern (NSC) downgraded to Market Perform from Outperform at Wells Fargo
Questcor (QCOR) downgraded to Hold from Buy at Jefferies
St. Jude Medical (STJ) downgraded to Neutral from Buy at Mizuho
U.S. Steel (X) downgraded to Neutral from Buy at Nomura

Initiations

Aeterna Zentaris (AEZS) initiated with a Buy at Roth Capital
Basic Energy (BAS) initiated with a Hold at Wunderlich
Generac (GNRC) initiated with an Outperform at BMO Capital
Key Energy (KEG) initiated with a Hold at Wunderlich
MethylGene (MYLGF) initiated with a Buy at Roth Capital
Palo Alto (PANW) initiated with a Sector Perform at Pacific Crest
Patterson Companies (PDCO) initiated with a Buy at WallachBeth
Patterson-UTI Energy (PTEN) initiated with a Buy at Wunderlich
Plexus (PLXS) initiated with a Hold at Stifel Nicolaus
Steris (STE) initiated with a Buy at BofA/Merrill
Tetra Technologies (TTI) initiated with a Buy at Wunderlich
Tyco (TYC) initiated with an Overweight at Barclays

HOT STOCKS

Liberty Global (LBTYA) launched voluntary, conditional cash offer for Telenet Group
Northrop Grumman (NOC) increased outstanding share repurchase authorization to $2B
Adobe (ADBE): Building healthy pipeline for potential Creative Cloud paid subscribers
Genie Energy (GNE) extended expiration date for its pending exchange offer of up to 8,750,000 shares of Class B common stock for shares of Series 2012-A preferred stock on a one for one basis, to Wednesday, October 10 at 5:00 p.m., NYC time.
B&G Foods (BGS) to acquire New York Style and Old London brands from Chipita
StubHub (EBAY) said app supports Apple’s (AAPL) Passbook
Pandora (P) CEO sees "large, capable competitors" entering its market
Nidec (NJ) to acquire Kinetek Group and Avtron Industrial Automation

EARNINGS/GUIDANCE

Companies that beat consensus earnings expectations last night and today include:
AAR Corp. (AIR), Apogee Enterprises (APOG), Steelcase (SCS)

Companies that missed consensus earnings expectations include:
IHS Inc. (IHS), Clarcor (CLC), Bed Bath & Beyond (BBBY), Herman Miller (MLHR)

Companies that matched consensus earnings expectations include:
Adobe (ADBE)

NEWSPAPERS/WEBSITES

Massive injections of stimulus into financial markets by the major central banks are creating a domino effect worldwide the globe, prompting governments from Brazil to Turkey to take steps to keep easy money from flooding in and driving up their currencies, the Wall Street Journal reports
Google (GOOG) is expected to pass Facebook (FB) in selling online "display" ads in the U.S. this year, according to a new estimate by research firm eMarketer, the Wall Street Journal reports
Phil Anschutz's sports and entertainment business AEG is creating interest from a number of media firms and private equity firms, including Liberty Media Corp. (LMCA), Guggenheim Partners LLC, Thomas H. Lee Partners LP, Bain Capital LLC and Colony Capital LLC, in a deal that could be worth over $6B, sources say, Reuters reports
The Fed’s move to stimulate the economy by buying mortgage securities is proving to be a boon for three of the biggest players in the bond fund business: Pacific Investment Management Company, DoubleLine Capital and TCW, Reuters reports
Dallas Fed President Richard Fisher said the central bank’s third round of bond purchases will probably fail to create jobs while risking higher inflation. “I do not see an overall argument for letting inflation rise to levels where we might scare the market,” he said, Bloomberg reports
If the major U.S. banks aren’t forced to cut their investment units from traditional banking, they will return to behavior that led to the 2008 credit crisis, said FDIC board member Thomas Hoenig, Bloomberg reports

SYNDICATE

Approach Resources (AREX) 5M share Secondary priced at $30.50
Ascent Solar (ASTI) Technologies 9.17M share Spot Secondary priced at $1.20
Atlas Resource Partners (ARP) files to sell 7.68M common units for holders
Capital Bank Financial (CBF) 5.68M share IPO priced at $18.00
Cheniere Energy Partners (CQP) announces offering of 8M common units
Horizon Pharma (HZNP) announces proposed offering of common stock
National Bank (NBHC) 7.1M share IPO priced at $19.25
Simon Property (SPG) announces offering of 5.87M shares of common for holders
Spirit Realty (SRC) Capital 29M share IPO priced at $15.00
THL Credit (TCRD) announces public offering of 5.3M shares of common stock
Trulia (TRLA) 6M share IPO priced at $17.00

 

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Thu, 09/20/2012 - 08:18 | 2814337 Snidley Whipsnae
Snidley Whipsnae's picture

Fisher doing his best to cover his azz before the explosion...

“I question the efficacy of these large-scale asset purchases,” Fisher said. “What we are doing is not having the impact on employment.”

 

Thu, 09/20/2012 - 09:00 | 2814482 j0nx
j0nx's picture

Hard to believe that anyone in their right mind would think that Obama actually works for the little guy after his record in office and the polishing he gives to the bankers' knobs at our expense. Seriously WTF is wrong with people that they can't see reality? I guess it's just as well that the complete and utter collapse of this country happens under a liberal democrat's reign since liberalism and the democratic brand will be a cursed belief in American homes for the next century after that. At this point I have completely given up on my fellow Americans' ability to grasp the truth and realize what's going on right under their noses. I suppose in the end that makes ME the problem since I am obviously in the minority.

Thu, 09/20/2012 - 09:09 | 2814523 spanish inquisition
spanish inquisition's picture

"Waht? I might need change my position for the "latino" vote? I stand by my earlier remarks. Heck, my parents were in Mexico and they self deported themselves back to the US! ..........

OK,OK. Let them "register" for freedom in specific instances and then we can use the paperwork to deport them later. Let the big donors know"

http://www.bloomberg.com/news/2012-09-20/romney-softens-tone-on-immigration-during-hispanic-voters-forum.html

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