Morning @ Cantor
Morning @ Cantor 7/1
Today’s Stories From Cantor Fitzgerald
Sal Catrini (908) 517-5067
EARLY US LANDSCAPE****
· US Stock Futures..SPs flattish ..near session highs….Euro stocks steadily creeping off lows, dn 1.15% at 7am et…Dollar weaker….peripheral spreads mostly better in EU
· EUR hits new highs... ECB Lends 111 Billion Euros to Smooth Loan Expiry
· Bad news still being digested…Stocks, Metals, Oil Fall on China Manufacturing miss and Spain’s Rating move by Moody’s yesterday
· Crude dn 80c
· gold flattish
o ECB Lends 111 Billion Euros to Smooth Loan Expiry - BBG
§ The European Central Bank said it will lend banks 111.2 billion euros ($136.5 billion) for six days to help them cope with the expiry of its landmark 12-month loan today
§ ECB said 78 banks asked for the six-day funds at the benchmark interest rate of 1 percent. Banks today need to repay 442 billion euros in 12-month loans, the biggest amount ever awarded by the ECB. Banks asked for 131.9 billion euros in three-month loans yesterday, less than economists expected.
§ “Together with yesterday’s operation, the funding needs come in on the high side of estimates. However, the banks that are overly reliant on the ECB are on the periphery of Europe, it’s not stress across the board.” BBG quote
o 3-Month Euribor Rises To 0.782% Vs 0.767% Wednesday
o German bankers prepare for possibility of emergency capital injections – FT
o Sweden Central bank (Riksbank) raised interest rates by 25bps to 0.50%; as expected
o NYSE Margin Debt Plunges 9.8% in May, Biggest Decline since November 2008 and Outpacing S&P 500’s 8.2% Drop. Trimtabs
o Equity Mutual Fund Cash Edges Up to 3.6% of Assets in May from 3.5% in April - Trimtabs
o Spanish bond auction….went OK….per BBG ..EUR extends rally, spain bonds firm..EUR near 1.23
o Mexico Lowers Warning To Tropical Storm From Hurricane For Alex - NHC
o Tropical Storm Warning Lifted In Texas – NHC
· Asian Markets: Nikkei (2.04%); Hang Seng (closed); Shanghai Composite (1.02%)
o Nikkei falls 2% despite good Tankan
o China’s Shanghai Composite Index dropped for a seventh consecutive session, losing 1% percent and bringing its retreat this year to 28 percent
· EU stocks: (per Steve Pope)
o After 2 hours of European trading the equity markets are lower between 1.06% and 2.07%, largest decline is in the French CAC 40.
o The markets are concerned over the fall in Chinese manufacturing growth and the prospect that Moody's may cut Spains Aaa rating. The latter point is rediculous as a downward driver as (1) it was expected and (2) both S&P and Fitch have made this move already.
o The Spanish 5 year auction of €3.5Bn went relatively well as the Bid to Offer cover was 1.7X (2.35X last time a 5 year came on May 6th). The yield was 3.657% as against 3.532% in May. The spread over 5 year german paper is steady at +228bps from +229bps on Wednesday.
o German Retail Sales increased in May when unemployment declined. In May the sales data gain 0.4% m/m after a fall of 0.5% m/m in April.
· Fed officials see soft recovery and more uncertainty
o (Reuters) - Jitters that financial strains may derail the U.S. economic recovery mean the Federal Reserve will be in no rush to end its ultra-low interest rates, comments by officials of the U.S. central bank suggested on Wednesday.
o One senior Fed official went as far as acknowledging that falling inflation could spur the central bank to further ease financial conditions, and another policy maker would not rule out additional measures to stimulate growth.
o Cites Lockhart, Evans and Duke
· Jim Rogers Sees Bond Market Bubble Developing
o Bond markets are a bubble waiting to burst because the world economy is facing even worse problems after central banks flooded markets with cash to try to get out of the crisis, famous investor Jim Rogers told CNBC Thursday
o http://www.cnbc.com/id/38031568
· Yen Nears Level of Kan’s ‘Verbal Intervention’
o Bloomberg) -- The strength of the yen, the world’s best-performing developed-nation currency, may prompt Japanese government officials to verbally intervene to weaken it in order to protect exporters.
· Swedish Riksbank Raises Main Rate to Cool Recovery
o Bloomberg) -- Sweden’s Riksbank raised the main lending rate a quarter-point from a record low in a split decision to cool economic growth and forecast more increases through 2011 than it previously predicted.
· China sets yuan mid-point at 6.7858
o The People's Bank of China has set the yuan's daily mid-point at a post-revaluation high of 6.7858 against the US dollar after the yuan ended at a post-revaluation closing high of 6.7814 on Wednesday, amid mixed signals from the United States on China's currency policy. Reuters
· Obama Says U.S. Will Keep Up Pressure on China Over Currency - BBG
o In summary, the healthcare spending and the Social Security will consume an increasing portion of the budget and will push the national debt up sharply unless lawmakers act, CBO Director Douglas Elmendorf warned
· Deficit Panel Stresses Spending Cuts
o Democrats on a blue-ribbon deficit-reduction panel suggested spending cuts would likely have to outweigh tax increases if the nation is to seriously tackle its ballooning financial obligations
o While praising Democrats' recent health-care overhaul for expanding access to services, Mr. Bowles also emphasized the need to find significant savings
o http://online.wsj.com/article/SB10001424052748704334604575339272679764964.html?mod=rss_whats_news_us&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wsj%2Fxml%2Frss%2F3_7011+%28WSJ.com%3A+What%27s+News+US%29&utm_content=Google+Reader
· U.S. groups urges Senate to reject China forex bill Reuters
o A broad coalition of U.S. business groups urged senators on Wednesday not to approve a bill that would allow the United States to use import duties against China's exchange rate policy.
· BoE Miles: Says there is no need for interest rate hike at this time despite inflation being uncomfortably high – ttn
· Germany : Telegraph's Ambrose Evans-Pritchard comments on Wednesday's presidential elections in Germany; Noted, after it was reported that Chancellor Merkel's candidate for president, Wulff, lost the first two rounds of voting in the electoral college, equity markets declined, as the development was an effective no confidence ruling in the Christian Democrat-Liberal coalition
· Data
o China PMI, HSBC indices show weakness .. but sharp drop in inflationary pressures may reassure policymakers that the risk of credit-fuelled overheating is f— per CNBC
§ Chinese Economy Cools as Tightening Bites
§ Purchasing Managers' Index, which fell to 52.1 in June from 53.9 in May. The reading, the weakest since February, fell short of the median forecast of 53.1 in a Reuters poll of 10 economists.
§ A separate survey compiled for HSBC fell more steeply to a 14-month low of 50.4 from 52.7 in May.
o Japans Tankan .. Japan Business Mood Best in 2 Years, Capex Up
o Monster Online Job Index Jumps Sharply
o Sweden Central bank (Riksbank) raised interest rates by 25bps to 0.50%; as expected
o Germany May Retail sales +0.4% m/m vs consensus +0.4%.
o France May Producer Prices 4.3% y/y vs consensus 4.5%, 0.0% m/m vs consensus 0.2%.
o France Jun Final Manufacturing PMI 54.8 vs preliminary 54.9.
o Germany Final Manufacturing PMI 58.4 vs preliminary 58.1. Eurozone June Final Manufacturing PMI 55.6 vs consensus 55.6.
o UK June Manufacturing PMI 57.5 vs consensus 57.5
· Money Raising:
o AgBank offering 10 times oversubscribed: report from Business Spectator
o IPO Filings Hit Post-2007 High Amid Losses; LBO Firms Seek Cash
§ HCA Inc., Zipcar Inc. and 89 other companies filed with the Securities and Exchange Commission last quarter to sell $23.6 billion of shares, data compiled by Bloomberg
o Some IPOs pulled this week…takes attention off of successful Tesla IPO
o Yesterday and IPO Withdrawal … MX MagnaChip Semiconductor Corp 7.5m share IPO expected to price 6/30 via Barclays, GS, and DB: Price Talk $15.50-17.50
· Withdrew IPO citing adverse market conditions
o WLS Welsh Property Trust 38.5m share IPO expected to price this week (wk of 6/27): Pricce talk $8.50-10.50.
§ IPO pulled citing market conditions.
o ISLE Isle of Capri postpones common stock offering
· M&A
o EMR Power transmission and industrial automation giant ABB Ltd. (ABB) Thursday threw in the towel in a bidding war over U.K. industrial company Chloride Group PLC (CHLD.LN), increasing the chances of success for a rival offer by Emerson Electric Co. (EMR) of the U.S – press releases
· Securities underwriting posts a 33% drop for Q2
o Stock and bond sales by investment banks totaled $1.36 trillion in the second quarter, a 33% decline compared with the same period last year. The amount is the lowest quarterly total since late 2008, according to Dealogic. JPMorgan Chase retained its No. 1 position among underwriters, with more than $245 billion in new issues in the first six months of 2010. Bank of America Merrill Lynch and Barclays Capital round out the top three. The Wall Street Journal (01 Jul.)
· Barclays falls 3% on soft I-bank revenue outlook – BBG ; Analysts may use the comments “as an excuse to notch down forecasts,”
o investment banking conditions in May and June have been softer,” because of lower capital markets and mergers and acquisitions business
· UBS upgrades FDX, UPS
· Smurfit-Stone Container Corp., the second-largest U.S. maker of corrugated packaging, emerged from Chapter 11 bankruptcy and will begin trading tomorrow on the New York Stock Exchange under the symbol SSCC.
· EADS: Airbus subsidies illegal - WTO
· GOOG Reuters) - China's foreign ministry said on Thursday it had no comment on Google's decision to end automatic rerouting of users to its uncensored Hong Kong search portal, but that all Internet operators had to abide by local laws
· AIG’s Benmosche Said to Threaten to Resign Unless chairman Golub Quits - BBG
o During a June 25 meeting of New York-based AIG’s board, Benmosche, 66, demanded more control over the divestiture of the company’s main Asia unit, including making top-level management changes
· Home health nursing company Amedisys,. (AMED) said Wednesday that it has received notice of a formal investigation from the Securities and Exchange Commission or SEC pertaining to the company. – may be old news to mkt per Jeffries
· Rio, BHP Shares Pare Losses After Report of Tax Deal – BBG
o BHP Billiton Ltd. and Rio Tinto Group pared losses in Sydney trading after a report on the Age and Sydney Morning Herald websites of a breakthrough in talks on a planned mining profits tax that prompted the ousting last week of former Prime Minister Kevin Rudd.
· Demand positive: Maersk Rejects Cargos, Cosco Imposes Levy on Container Shortage - BBG
o Maersk has reactivated idled vessels to help relocate empty containers and ordered new boxes after a larger than expected jump in shipping demand squeezed supplies
o “It’s the first time in many years that we are seeing consistent equipment shortages in many areas of Asia,”
· MAN CEO Expects 2011 To Be "Much Better" Than 2010 – DJ
· Financial reform…
o House Sends Finance Overhaul to Senate – WSJ link
§ The House agreed to a sweeping rewrite of the nation's financial regulations, moving the initiative one step closer to becoming law. The focus now shifts to the Senate.
o Members switch votes on Wall St. overhaul - The Hill
§ Democratic efforts to overhaul Wall Street drew stronger support Wednesday than in December. The legislation passed Wednesday on a 237-192 vote, with three Republicans in support and 19 Democrats opposed. In December, an earlier version of the legislation passed 223-202, with no Republicans in support and 27 Democrats opposed. Read more
o The U.S. financial-regulatory bill, approved by the House of Representatives yesterday, may still be compromised in the Senate, which postponed its vote until after the week-long July 4 recess. The delay may give opponents of the legislation time to persuade undecided lawmakers to vote against the measure. BBG
· Senate adjourns for July Fourth without passing unemployment benefits extension The Hill
o The vote failed 58-38 on the two-pronged measure that included a $34 billion six-month extension of unemployment benefits. Read more
· China general says open to U.S. defense boss visit Reuters
o A Chinese general said on Thursday that U.S. Defense Secretary Robert Gates was welcome to visit China at an "appropriate" time, possibly signaling a desire to soften military tensions between the two powers.
- Economics:
- Challenger Job Cuts (Jun) at 7:30 ET
- US Initial Jobless Claims (for w/e 26-Jun) SA Consensus 455K at 08:30 ET
- US Continuing Claims (19-Jun) SA Consensus 4.52M at 08:30 ET
- ISM Manufacturing (Jun) SA Consensus 59.0 at 10:00 ET
- US Pending Home Sales (May) SA Consensus (12.5%) at 10:00 ET
- ISM Prices Paid (Jun) Consensus 71.0 at 10:00 ET
- US Construction Spending (May) SA Consensus (0.8%) at 10:00 ET
- Natural Gas Inventories released at 10:30 ET
- Jun domestic vehicle sales will be reported throughout the day
- Earnings:
- Reporting before the bell: MXB, STZ
- Reporting after the close: DMAN, FC, FLOW
· Reid to Meet With Obama, Bidenfrom Roll Call - Breaking News
o Senate Majority Leader Harry Reid (D-Nev.) will meet with President Barack Obama and Vice President Joe Biden on Thursday afternoon, the White House indicated Wednesday. Roll call
· Obama to Discuss Oil-Spill Response, Plans Thursday, U.S. Says – BBG
o President Barack Obama will meet with senior government officials tomorrow to review the BP Plc oil spill and discuss plans for the future, according to the Joint Information Center on the spill.
· The Treasury will also announce the size of next Thursday's 10 year TIPS auction today
TODAY’S BIG STORIES
· Equity Wrap:
o We saw a little bit of everything in terms of action, there was money coming into the market but it is very tired and again, and most has been deployed from what I see. Quant’s were buying some stuff earlier on the dip, not sure if covering shorts or not but like I said, by day’s end, shorts were pressing their names
o Breadth to the market had 2 declining issues for every 1 advancing issue, while internally here, sell names outnumbered buy names. Technically, keep an eye on 1,029 which was November 2nd 2009 low and then , 1014 (38.2% Fibonacci level b/t oct '07 high and mar '09 low), 1000 (round number)
o S&P futures were up 6 to 9 points in the early going on news that European Banks only needed $161B from the ECB to carry them through the next three months (expectations were that the demand would be as much as twice that amount). With the 8:15 release of the ADP Employment change (up 13k vs. an expected 60k- private sector), S&P’s immediately gave up all those gains. Once the cash market opened, the bulls pushed prices back to the preopening highs, only to be turned back when Moody’s placed Spain’s Aaa credit rating under review for possible downgrade (Fitch and S&P have already done so). S&P’s spent the balance of the session in decline, falling 20 points from the high, to end the day at the lows , off about 1%. For the quarter, the S&P 500 fell about 12%; it is now off 15% from its 4/23/2010 peak. Michael Darda, chief economist for MKM partners commented that the “earnings yield” for the S&P 500 now stands at 8.8% (assuming $92 of earnings); this is the highest level relative to Investment Grade debt since the 1970’s.
o Technically, much has been made of an 8 month head and shoulders chart pattern; we ended the session just under the neckline (target projected on a significant break of the neckline is about 850 for the S&P cash index). Another formation getting attention is a “bear cross”, where a declining 50 Day MA crosses below a declining 200 day MA; that event could take place over the next few days should prices continue their decline.
o (Billy Clark and team)
· Treasury’s Wrap:
o The Treasury market made new recent highs overnight with 2s trading to .59% and 10s through 2.93% but these levels could not be sustained as the New York session opened with the whole curve backing up closer to yesterdays closes. A worse than expected ADP employment report, only 13K jobs created versus an expected 60K gave a quick bid, but Treasuries settled down rather quickly trading range bound throughout the morning session. After Treasuries trended lower in the early afternoon, the news that Moody's will review its rating of Spain, month end/half year end buying and weaker equities all contributed to Treasuries once again firmly bid throughout the late afternoon and into the close. At 3PM Treasuries finished mixed with a flatter curve (2/10s flatter by 2.4bps at 233 2/30s flatter by 4.6bs at 329bps). The long end was the best performer with large long dated principle buying aiding the sector.
o Tomorrow the market will look towards the weekly claims data, challenger job cuts, ISM and pending home sales, with many investors awaiting the government payroll report on Friday. We look to buy pullbacks in the market favoring a small curve flattener.
o The Treasury will also announce the size of next Thursday's 10 year TIPS auction Thursday
o Primary Dealer
· Credit Markets: Auto-Loan Debt Sales Rise on Faith in Consumers
o Sales of securities backed by car and truck loans are rising even as corporate debt issuance declines in a show of faith in consumers by fixed-income investors
o Automakers and their finance subsidiaries sold $30 billion of the debt this year, a 45 percent increase from $20.7 billion in the same period of 2009, Barclays Capital data show. U.S. corporate bond sales fell 30 percent to $500.3 billion from $716.1 billion, according to data compiled by Bloomberg.
· Money flows: Retail Investors Regain Appetite for Bonds. Bond Funds Get $6.3 Billion in Week Ended June 23 and Estimated $3.2 Billion on Following Four Days. Short-Term Bond Funds Clear Favorites, Attracting 3.2% of Assets in Past Month – TRIMTABS
· Equity Mutual Fund Cash Edges Up to 3.6% of Assets in May from 3.5% in April. Consistently Low Levels Supporting TrimTabs Demand Index.
o Cash as a percentage of equity mutual fund assets edged higher to 3.6% in May from 3.5% in April. The cash level increased slightly because the 8.9% plunge in equity mutual fund assets was even greater than the 8.4% drop in cash holdings. TRIMTABS
· jobs Monster Online Job Index Jumps Sharply – CNBC link
o US Job Availability Jumps Sharply vs Year Ago
o Monster Worldwide Inc [MWW 11.65 -0.46 (-3.8%) ], an online careers and recruiting firm, said its employment index rose to 141 points in June from 134 in May.
o The current month's reading is 20.5 percent above the 117 mark a year ago, the highest year-on-year growth reading since September 2006.
o "While substantial job creation has yet to occur to reduce the existing levels of unemployment and underemployment, job availability is improved from where it was a year ago." said Jesse Harriott, a senior vice president at Monster Worldwide.
· jobs Temporary Jobs Show Little Faith in U.S. Recovery - BBG
o Normally a harbinger of gains in permanent employment, a surge in temporary staffing signals U.S. companies lack faith in the sustainability of the recovery
o hiring of temporary workers climbed 16.4 percent in the 12 months to May, the biggest year- over-year gain since 1994, according to Labor Department figures. Payrolls at companies dropped 0.8 percent over the same period, a difference of 17.2 percentage points that is the largest in records dating back to 1990
· jobs Senate Democratic leaders introduced their long-awaited small-business jobs bill on Tuesday - and in an indication of how urgently legislators viewed the matter, the Senate voted to begin debating the measure even before its details were finalized.
o http://dealbook.blogs.nytimes.com/2010/07/01/senate-takes-up-small-business-jobs-bill/
· jobs Poor behave 'rationally' by avoiding work and claiming benefits, Iain Duncan Smth says - from Telegraph Finance
o Welfare claimants who avoid work because it pays to stay on benefits are behaving in a "frankly pretty rational" manner, Iain Duncan Smith has said.
· Senate panel will vet Fed nominees July 15 Reuters
o The Senate banking panel said on Wednesday it has scheduled hearings on the nominations of Janet Yellen to serve as Vice Chairman of the Federal Reserve and of two others to become members of the Fed Board of Governors
· California budget deadline passes without a budget from Los Angeles Times –
o No deal between Gov. Arnold Schwarzenegger and state legislators was imminent. State employees and others who depend on government money brace for the fallout.
o California begins a new budget year Thursday without a spending plan in place and with no agreement imminent between state legislators and Gov. Arnold Schwarzenegger on how to close a $19.1-billion deficit.
· Poll: Favorable views of health reform law increasing among Americans from Wash Post Politics
o The health-care overhaul gained popularity from May to June, according to a new tracking poll.
· Tea party influence swaying centrists - POLITICO
o Local tea
parties wield influence in the home states of usually reliable moderates.
· Clinton may seek to ease worry about U.S.-Russia thaw
o WASHINGTON (Reuters) - U.S. Secretary of State Hillary Clinton visits five countries once firmly in the Soviet Union's grip this weekend in part to try to allay fears that better U.S.-Russian relations may come at their expense.
· Iran Arms Syria With Radar
Iran has shipped a radar system to Syria that may undercut Israel's ability to launch a surprise attack on Iran's nuclear facilities.
COMPANY NEWS WITH MACRO IMPLICATIONS
· Stocks mentioned on CNBC's Mad Money with Jim Cramer - TheStreet.com
+ DD, PPG, BMY, and MMM are way too cheap right now. F, GIS
TECH MEDIA TELECOM SECTORS
· XRTX- better Q as strong customer demand continued in the Q especially in networking storage solutins. The company also issued strong guidance for Q3 expecting the solid demand to continue. XRTX continues to benefit from the fall of the UK pound vs the USD.
· MITL- slightly better Q4 and guides higher. Management noted strong demand for IP Telephony products throughout the Q, and also says it does not see a slowdown in Europe.
· GOOG: China Plan May Stoke Exodus to Baidu, Clients Say- BBG
· GOOG: China says has no comment on Google rerouting move- Reuters
· MSFT: scraps new Kin social-networking smartphone. Blames Low Sales, High Price for Failure- BBG
· Mobile: Carriers Go to Battle Over Faster Networks- All Things Digital
· http://ptech.allthingsd.com/20100630/carriers-go-to-battle-over-faster-networks/?mod=ATD_rss
· Piracy: Feds disable websites accused of movie piracy- AP
· WPO: 2 Suitors for Newsweek Are Said to Be Ruled Out- NYT
· The Washington Post Company has rejected overtures from the owners of Newsmax, the monthly conservative magazine, and Thane Ritchie, an Illinois hedge fund manage
· http://www.nytimes.com/2010/07/01/business/media/01newsweek.html
· Vivo: Telefonica primed to fight Portuguese veto on Vivo- Reuters
· LGF: Witching Hour comes and goes for Icahn’s Lions Gate Bid- Dealbook
· Panasonic Ups LCD Stake- WSJ
· AMZN Amazon to acquire online store Woot- Reuters
· AMZN cuts the giant Kindle DX price to $379 from $489 and includes better-contrast display- silicon valley Insider
· IBM buys stake in China's Bright Oceans for $50m- reuters
· Facebook: Elevation Invests Another $120m in Facebook as that IPO Looks More Distant- Tech Crunch
· DRAM: contract quotes likely to decline in July and August- Digtitimes
· Wireless Charging: market set to expand by factor of 65 by 2014- iSuppli
· AMD may see tight chip supply from TSMC in 2H10- Digitimes
· AMD's chip supply from Taiwan Semiconductor Manufacturing Company (TSMC) may face shortages in the second half as Nvidia has already placed a large amount of orders to TSMC in March and April and may squeeze AMD's order out of the already fully-loaded capacity
· PCs: Global all-in-one PC shipments to surpass 11 million units in 2010- Digitimes
· ANAD, RFMD, SWKS,TQNT Needham initiates RF Micro Devices initiated buy with $6.50 target; Skyworks initiated buy with $24 target; TriQuint Semiconductor initiated buy with $9 target; Anadigics initiated hold
· IDT IDT Corp names Samuel Jonas as COO effective 24-Jun - 8-K
· CYDE CyberDefender files $40M mixed shelf
· CTXS Citrix Systems discloses it reached a settlement in principle with IRS regarding income tax deficiencies asserted in prior RAR
· KOSS Koss releases restated financials for 2008-09
· YHOO Yahoo! announces new $3B share repurchase program
· LEE Lee Enterprises files $750M mixed securities shelf registration
· MENT Mentor Graphics holder Carl Icahn discloses a 10.84% stake in an amended 13D filing; up from 9.49% stake disclosed on 22-Jun
· NETL, PSEM, SMSC, VLTR Noble Financial initiates Standard Micro initiated buy with $27 target; Volterra Semiconductor initiated buy with $27 target; Pericom Semiconductor initiated buy with $11 target; Netlogic Microsystems initiated hold with $30 target
· LDK LDK Solar discloses additional provisions not originally contained in 4Q09 results
· NOK Nokia upgraded to neutral from reduce at West LB Equity Markets - SA London
· NOK Nokia upgraded to accumulate from reduce at Svenska Handelsbanken, target remains €7. - SA London
· MICC Millicom, local partner in Honduras reach agreement giving Millicom full control of subsidiary Celtel
· ACN, STO Accenture signs five-year business-process-outsourcing contract to manage Statoil’s accounts-payable processes
· IBM, Roche Holding, IBM agree to develop nanopore-based sequencer that will directly read and decode human DNA
ENERGY
· BP BP reports ~6,085 barrels of oil collected during first 12 hours of 30-Jun
· COP ConocoPhillips completed the sale of 50% partnership interest in CFJ Properties - Flying J truck stops to Pilot Travel Centers for $626M
· HOKU Hoku Corp receives $28.3M loan from China Construction Bank
· ITC ITC Holdings receives siting approval for phase II of KETA transmission line project
· HOKU, STP Hoku and Suntech amend supply agreement
· PVX Provident Energy Trust announces the ex-distribution date for Provident's post Pace Oil and Gas stock distribution on the NYSE
· PIKE Pike Electric buys Klondyke Construction LLC
· MTRX Matrix Service to construct tankage for Cederated Co-operatives near Carseland, Alberta, Canada
· CLNE, RSG Clean Energy to supply LNG fuel to Republic Services solid waste truck fleets serving 55 California cities
· PBR NY Times notes some concerns over the government recapitalization plan for Petrobras
· STO StatoilHydro signs ISS frame agreements
· BP BP may sell its 60% stake in Pan American Energy - Daily Mail
· BP BP returns to banks to get more money - FT
· BP BP trying to close internal independent safety watchdog agency – CNN
INDUSTRIALS
· BA: Boeing’s U.S. Allies See Tanker Boost in Airbus Case - BBG
o Boeing Co.’s bid for a $35 billion contract to build aerial tankers may gain U.S. political momentum after the World Trade Organization ruled that European governments provided illegal aid to Airbus SAS.
o The WTO’s decision spurred Boeing allies in Congress to urge the Pentagon yesterday to penalize a tanker bid from Airbus parent European Aeronautic Defence & Space Co. Analysts such as Dan Solon of London-based Avmark International also said the case would make it easier for U.S. lawmakers to oppose Airbus.
· RMX RMX Holdings, inc. forms special committee
· Indonesia wants to buy billions of dollars of F-16s, C-130Hs - Jakarta Post
· RA RailAmerica to acquire Atlas Railroad Construction for ~$24M in cash
· NLC Nalco comments on EPA dispersant test results
· KSU, UNP Raymond James initiates Kansas City Southern initiated strong buy with $46 target; Union Pacific initiated outperform with $80 target
· GENC Gencor Industries CFO Ray Adams resigned effective 25-Jun
· SWHC Smith & Wesson reports Q4 EPS
· SSD Simpson Manufacturing to sell the assets of Simpson Dura-Vent
· SHIP Seanergy Maritime Holdings CEO purchases 50K shares at $1.25/sh
· PRGN Paragon Shipping announces sale of one Kamsarmax contract, to acquire two 3,400 TEU containerships
· SI Siemens upgraded to add from neutral at West LB Equity Markets - SA London
TRANSPORTS
· UBS upgrades FDX, UPS
· Bloomberg) -- British Airways Plc’s cabin-crew union will depart from its previous stance by putting the company’s latest pay offer to members without recommending they reject it
· Demand positive: Maersk Rejects Cargos, Cosco Imposes Levy on Container Shortage - BBG
o Maersk has reactivated idled vessels to help relocate empty containers and ordered new boxes after a larger than expected jump in shipping demand squeezed supplies
o “It’s the first time in many years that we are seeing consistent equipment shortages in many areas of Asia,”
· MAN CEO Expects 2011 To Be "Much Better" Than 2010 – DJ
· CNI Canadian National Railway reports weekly carloads (week ended 26-Jun), total carloads +34.8% to 94,381; last week's increase was +26.9%.
· WERN, HTLD, JBHT, KNX Piper Jaffray initiates JB Hunt Transport initiated overweight with $42 target; Werner Enterprises initiated overweight with $28 target; Heartland Express initiated neutral with $17 target; Knight Transportation initiated neutral with $23 target
· BRKB Berkshire Hathaway's Burlington Northern reports weekly carloads (week ended 26-Jun) ; total carloads and intermodal +10.9% to 174,373; last week +14.4%
· Bombardier wins $101M contract from Delhi Motor Rail Corp - Canadian Press
MINERS/STEEL Etc
· MGN Mines Management reports Q1 EPS
· ECL Ecolab launches first EPA-approved, ready-to-use hard surface disinfectant effective against clostridium difficile
· SCHN Schnitzer Steel reports Q3 EPS
· "Significant progress" made on resources super profits tax - The Age
· Rio, BHP Shares Pare Losses After Report of Tax Deal – BBG
o BHP Billiton Ltd. and Rio Tinto Group pared losses in Sydney trading after a report on the Age and Sydney Morning Herald websites of a breakthrough in talks on a planned mining profits tax that prompted the ousting last week of former Prime Minister Kevin Rudd.
· Chalco drops US$2.4bn Australia plan – FT link
o China’s Chalco, the world’s second-largest aluminium producer, has pulled out of a US$2.4bn deal to develop a bauxite refinery in Australia, blaming a drop in aluminium prices and difficult global conditions
· Fortescue wants wider input before tax deal from Business Spectator
AUTOS
· F WSJ notes the potential bull case for Ford
· Ford dividends ?? Bloomberg) -- Ford Motor Co., which caught up yesterday on preferred stock dividends it missed for 14 months, may resume payouts on the common stock as soon as 2012, according to data compiled by Bloomberg.
· French new light commercial vehicle registrations +10.9% in Jan-June – DJ s, citing CCFA
o French new light commercial vehicle registrations rise +14.9% in June
o French new passenger car registrations rise +5.4% in Jan-June
o French new passenger car registrations (1.2%) in June
· Credit Markets: Auto-Loan Debt Sales Rise on Faith in Consumers
o Sales of securities backed by car and truck loans are rising even as corporate debt issuance declines in a show of faith in consumers by fixed-income investors
o Automakers and their finance subsidiaries sold $30 billion of the debt this year, a 45 percent increase from $20.7 billion in the same period of 2009, Barclays Capital data show. U.S. corporate bond sales fell 30 percent to $500.3 billion from $716.1 billion, according to data compiled by Bloomberg.
· Toyota weighs recall of up to 270,000 cars – FT link
o Toyota says it is considering steps to eliminate possible engine failure in up to 270,000 Lexus and Crown models, as it continues to ramp up its safety oversight
· Mazda CEO eyes China JV with max stake
o from Business Spectator
o Automaker awaiting regulatory approval for 50% holding in venture. 1 Jul 2010 1:38 PM
· BMW may invest $1 billion in Mexican auto suppliers, minister says
o from Automotive News Breaking News Feed
o BMW AG, the world's largest maker of luxury cars, may invest more than $1 billion in Mexico to prepare local auto-parts companies to boost supplies to its U.S. plants, Mexican Economy Minister Gerardo Ruiz Mateos said.
·
FINANCIALS
· Financial reform…
o Members switch votes on Wall St. overhaul - The Hill
§ Democratic efforts to overhaul Wall Street drew stronger support Wednesday than in December. The legislation passed Wednesday on a 237-192 vote, with three Republicans in support and 19 Democrats opposed. In December, an earlier version of the legislation passed 223-202, with no Republicans in support and 27 Democrats opposed. Read more
o The U.S. financial-regulatory bill, approved by the House of Representatives yesterday, may still be compromised in the Senate, which postponed its vote until after the week-long July 4 recess. The delay may give opponents of the legislation time to persuade undecided lawmakers to vote against the measure. BBG
o Delayed Senate vote might lead to a watered-down financial bill
§ The U.S. Senate's decision to postpone a vote on financial-reform legislation until after the July 4 recess might put the bill at risk, analysts said. The move gives critics more time to persuade undecided senators to vote against the overhaul. "While the odds are that a week doesn't change anything, certainly [Republican Sens. Olympia] Snowe, [Susan] Collins and [Scott] Brown are going to get lots of visits over that week from their local community bankers and anyone else who has an interest in this," said Mark Calabria, a former staff member of the Senate banking committee. The House approved the bill Wednesday. Bloomberg (01 Jul.) , The Wall Street Journal (01 Jul.) , The New York Times (free registration) (30 Jun.)
· Securities underwriting posts a 33% drop for Q2
o Stock and bond sales by investment banks totaled $1.36 trillion in the second quarter, a 33% decline compared with the same period last year. The amount is the lowest quarterly total since late 2008, according to Dealogic. JPMorgan Chase retained its No. 1 position among underwriters, with more than $245 billion in new issues in the first six months of 2010. Bank of America Merrill Lynch and Barclays Capital round out the top three. The Wall Street Journal (01 Jul.)
· Barclays falls 3% on soft I-bank revenue outlook – BBG ; Analysts may use the comments “as an excuse to notch down forecasts,”
o investment banking conditions in May and June have been softer,” because of lower capital markets and mergers and acquisitions business
· FDIC Hikes Reserve Ratio Minimum by 20 Basis Points
· from American Banker
· Bankers and some lawmakers reacted with a mix of uncertainty and outrage on Wednesday after the conference committee opted to raise deposit insurance premiums on large institutions in an effort to pay the costs of the regulatory reform bill.
· MS may hire 500 bankers in lending push – BBG
· Buffett's Berkshire May Have to Post $8 Billion Collateral – CNBC link
· AIG CEO Threatened to Quit if Chairman Stays: Report– CNBC link
· AIG’s Benmosche Said to Threaten to Resign Unless chairman Golub Quits - BBG
o During a June 25 meeting of New York-based AIG’s board, Benmosche, 66, demanded more control over the divestiture of the company’s main Asia unit, including making top-level management changes
· Stress Tests, and Germany's Unlisted Banks - NYT
o German officials seeking to bolster confidence in the financial system by releasing the results of banking stress tests may heed calls to shine a light into the accounts of Germany's state-owned lenders.
· PBIB Porter Bancorp completes $27.0M stock offering in private placement through Sandler O'Neill
· WSH Willis Re says that Chile earthquake, Australia storm have little impact on property catastrophe pricing
· IBCA Intervest Bancshares files $46M equity offering through Sandler O'Neill
· KFS Kingsway Financial appoints Larry Swets President and CEO; as was previously announced on 16-Apr
· WTNY Whitney Holding upgraded to market perform from underperform at Keefe, Bruyette & Woods, target decreased however to $10.
· MTB M&T Bank initiated sector perform at RBC Capital; target is $89.
· MENT Mentor Graphics holder Carl Icahn discloses a 10.84% stake in an amended 13D filing; up from 9.49% stake disclosed on 22-Jun
· CSE CapitalSource initiated buy at Sterne, Agee, target is $6.60
· CNO CNO Financial Group announces financial settlement of regulatory matter
· NTRS Northern Trust completes outsourcing of Hermes Fund Managers investment operations
· STD WSJ notes the concerns being raised over Banco Santander's recent spending
· $500B not burning a hole in private equity's pocket - NY Post
· AIG American International Group CEO Robert Benmosche threatened to resign last week - WSJ
o
REAL ESTATE
· Homebuyer credit extension heads to Obama
o from Economic news - CNNMoney.com
o First-time
homebuyers will have until Sept. 30 to close on their purchases and land an
$8,000 tax credit under a bill passed by the Senate late Wednesday._files/image001.gif){kind=small}
· Manhattan Apartment Market Healing - WSJ
o The Manhattan apartment market showed distinct signs of recovery during a busy second quarter, with a modest rise in prices and a large jump in sales, according to new data.
o The number of days that apartment listings lingered on the market also dropped as sales picked up. Although the number of listings rose slightly, offerings of more expensive apartments fell as that segment improved.
o One report, by Prudential Douglas Elliman showed that Manhattan apartment sales were up 79.9% from the second quarter last year. The median price at $899,000 was up 7.6% from a year earlier and 3.6% from the previous quarter.
o It put the average sale price for a Manhattan apartment at $1.43 million in the second quarter, up 9.1% from a year ago, and up 0.4% from the first quarter
· GYRO Gyrodyne announced court opinion requiring $98.7M payment for appropriated land
· IRET Investors Real Estate Trust reports Q4 FFO
· SKT Tanger Factory initiated buy at KeyBanc, target is $48
· CUZ Cousins Properties CFO James Fleming to retire
· EXL Excel Trust acquires five properties for $71.7M
· Fannie, Freddie trip up a program to increase homes' energy efficiency
o An Obama administration program to help U.S. homeowners finance energy-saving improvements is running into problems from Fannie Mae and Freddie Mac. The government-backed mortgage companies sent letters to lenders about the Property Assessed Clean Energy program, convincing them that mortgages on homes financed under the program wouldn't be purchased by Fannie or Freddie. As a result, many local programs promoting the energy retrofits are being shut down or put on the back burner until the matter is clarified. The New York Times (free registration) (30 Jun.)
·
·
CONSUMER
· Debenhams reported gross transaction volume +8.9%; like-for-like sales -0.4% over the 42 weeks. Gross margin for the year is expected to exceed previous guidance. Remained positive Q3 performance
· CKR CKE Restaurants stockholders approve merger agreement with Apollo Management
· ABM ABM Industries subsidiary ABM Janitorial Services acquired all of the outstanding shares of Diversco, Inc
· PHH PHH Corp amended revolving credit agreement on 25-Jun
· AEO American Eagle signs multi-year franchise agreement with Fox-Wizel
· NAV Navistar enters supply agreement with Turkish bus manufacturer Otokar
· ALCO Alico names Ken Smith COO
· SKS Saks initiated buy at CRT Capital, target is $8.70.
· UFI Unifi, Inc expects to record Q1 charge relating to partial redemption of notes
· CSV Carriage Services acquires Fuller Funeral Homes and Cremation Services in Naples and Cape Coral, Florida
· WCC WESCO International announces the acquisition of Potelcom Supply, Inc.
· CBK Christopher & Banks reports Q1 EPS
· APOL Apollo Group reports Q3 EPS
· WMG, VIA Warner Music lets MTV sell ads for its online music videos - LA Times
· WPO Washington Post tells two bidders for Newsweek not to bother - NYT
· ISLE Isle of Capri postpones common stock offering
· JACK Jack In The Box enters new credit agreement
GAMING, LODGING, & LEISURE
· GET Barron's Weekday Trader is positive on Gaylord Entertainment
· H Hyatt Hotels initiated hold at Hudson Square, target is 443.
HEALTHCARE
· AMED Home health nursing company Amedisys (AMED) said Wednesday that it has received notice of a formal investigation from the Securities and Exchange Commission or SEC pertaining to the company.
· **AMED...Jeffries defends (says already priced in) ...Amedisys Says It is Target of U.S. SEC Investigation
· WellPoint unit tries lower hike in California MarketWatch
o Rebuffed by regulators two months ago, WellPoint Inc.'s California health insurance unit is taking another stab at a rate hike in the Golden State, seeking a lower increase than before.
· DNDN Dendreon comments on CMS National Coverage Analysis
· MYRX Myriad Pharmaceuticals will change its name to Myrexis; effective 1-Jul
· JAZZ Jazz Pharmaceuticals quantifies 2010 net income impact from debt refinancing
· MEDQ MedQuist names Anthony James as Co-COO effective 24-Jun - 8K
· PVCT Provectus Pharmaceuticals files $50M equity shelf
· MRX Medicis upgraded to outperform from market perform at Bernstein, target is $28.
· GPRO Gen-Probe receives European CE mark for molecular test to detect common sexually transmitted disease Trichomonas vaginalis
· HNT Health Net awarded Network Services Contract
· MELA MELA Sciences secondary offering priced this morning was for 2.2M shares
· DNDN Dendreon trading sharply lower after hours
· CTIC Cell Therapeutics to provide update on financial and regulatory developments tomorrow in 8:30 ET conference call; Dial-in: 1-877-941-6010 (US) 1-480-629-9772 (International)
· CPSI Computer Programs & Systems names Chairman David Dye as interim VP and CFO
· THLD Threshold Pharmaceuticals initiates a randomized, controlled, phase 2 clinical trial evaluating th-302 in patients with advanced pancreatic cancer
· SONO SonoSite completes acquisition of Visualsonics
· DNDN CMS opens national coverage analysis of treatments such as Dendreon's Provenge
· ENMD EntreMed has filed to effect a 1-for-11 reverse stock split
· WLP LA Times reports that WellPoint's Anthem re-files for California rate hikes
· SNTS Santarus announces launch of prescription Zegerid authorized generic and company restructuring
· EXEL Exelixis confirms departure of George Scangos; names Michael Morrissey as president and CEO
· NHWK NightHawk Radiology completed settlement transaction with St. Paul Radiology
· MATK Martek Biosciences announces restructuring plans for Winchester KY manufacturing site
· BIIB Biogen Idec confirms that it has named George Scangos as CEO
· CBST Cubist Pharmaceuticals enrolls first patient in CXA-201 phase 2 study in complicated intra-abdominal infections
· ARNA Eisai to exclusively market Arena Pharmaceuticals's lorcaserin for obesity and weight management in US following FDA approval
· CELG WSJ notes concerns over the price of Celgene's deal for Abraxis BioScience
· ENDP Endo Pharmaceuticals submits complete response to FDA's 19-Oct Compolete Response letter for Fortesta (testosterone gel)
· CTIC Cell Therapeutics to retire all remaining 2010 convertible debt
· ACL, NVS Novartis says expects to close the transaction for majority ownership of Alcon in late Q3 or Q4 of 2010
· SNY Rifapentine is granted orphan drug status by European Commission for treatment of tuberculosis
· AMED Amedisys receives notice of formal investigation by SEC
· AEZS Aeterna Zentaris files $85M equity shelf registration
From our EU/London desk
· Energy
· Transocean (-4.7%) US investigate tax practises.
· Wood Grp (-1.3%) trading update.
· Wellstream (12%), warns on 2H.
· Mining
· Australian Govt likely to make announcement tomorrow on mining tax.
· Russian miner Polyus may seek London listing (mkt cap $10bln)
· Rio Tinto (-0.25%)
· BHP (-1%).
· Vedanta (-0.5%), Outperform rating at Credit Suisse.
· Anglo American (-1.4%) Posco + Kepco looking at 2 coal assets (DJ)
· Chemicals
· Arkema ( +0.3%), guiding Q2 higher
·
· Tate and Lyle Plc has agreed to sell all EU sugar refining operations to American Sugar efining Inc for £211m or $315m.
·
· Yesterday the Portuguese government used its "Golden Share" to block the sale by Portugal Telecom to Telefonica (Spain) of its share in Vivo, the largest cekllular phone operator in Brazil. Vivo has 35% of the Brazilian market and it is seen as a hot growth area. Telefonica have extended the €7.15Bn offer as it hopes the EU will overturn the veto.
·
· EADS: Airbus subsidies illegal – WTO- S&P
· Deutsche Post says business better again- S&P
· HEINEKEN to buy back shares worth EUR 150m - S&P
· Stolt-Nielsen 2Q EBIT above forecast- S&P
· Vestas achieves half its FY target in 1H10- S&P
· Portuguese govt blocks TELEFONICA bid for Vivo- S&P
· DEBENHAMS: 42-week LFL falls 0.4%, sees strong margins- S&P
· ORTH PORTS: 1H numbers to be well ahead last year - S&P
· GREENE KING: FY PTP rises 3.8% - S&P
· PAI and Carlyle drop out of race for UNILEVER's Findus- S&P
· WELLSTREAM: Sees slower recovery in 2H- S&P
· WOOD GROUP: Macondo will not affect FY performance - S&P
Asia Market Recap
· Japan
• NKY -2.04%, TPX -1.55%
• NKY fell tracking US overnight lead and after China reported slower manufacturing growth. Turnover on the TPX rose to 1.33 trillion yen from 1.10 trillion yen yesterday
• Stocks fell across most sectors led by tech, telecom, exporters, material and industrials
• Exporters fell on a strong yen: autos -2.56%, CE -2.67%. Sony (6758) -3.65% said it is recalling 535,000 Vaio personal computers because they may overheat due to temperature control defect. Honda (7267) -3.27% after report the automaker will recall 165 Civic and Stream models in China due to airbag defects. Toyota (7203) -2.27% after the Nikkei reported the carmaker may recall one of its top-of-the-line sedans, Lexus LS460, on concerns that its engines may stall
• Machinery -1.97% after China manufacturing PMI fell in June signaling slowing growth
• Shippers -2.45% as the Baltic Dry Index extended fall
• Steelmakers: Nippon Steel (5401) -2.03%, JFE (5411) -3.17% and Sumitomo Metal Industries (5405) -4.93%. The steelmakers plan a combined 686B yen in spending on plant and equipment during this fiscal year, -0.8% YoY
• Best performing sectors on the TPX: rubber products +0.91%, electric power & gas -0.41%, pharma -0.52%; worst performing sectors: nonferrous metals -3.24%, iron & steel -2.85%, transport equipment -2.58%
• Tokyo Tatemono (8804) -3.61% after the property developer said its 1H net income totaled 1.5B yen, 57% less than forecast
• Softbank (9984) -4.39% after the company said its affiliate Yahoo Japan (4689) -3.23% was ordered to pay a 26.5B yen extra taxes during the quarter ended June 30
• Shinsei Bank (8303) -1.32% after receiving a business improvement order from Japan’s financial regulator
• Bridgestone (5108) +1.13% on Goldman upgrade
· Nikkei today
• Japan Tankan survey: shows improving sentiments amongst manufacturers. Helped by a rebound in exports, large companies are picking up business spending which will help the broader economy
· -Business conditions for large manufacturers rose to 1 in 2Q from -14 last quarter, beating consensus -4. Outlook rose to 3 from -8 last quarter beating consensus 0
· -Business conditions for large non-manufacturers rose to -5 for 2Q from -14 last quarter beating consensus -7. Outlook rose to -4 from -10, in-line with consensus -3
· -Large companies plan to increase CapEx 4.4% this year, the first gain in 3 years
• New car sales rose 20.6% YoY to 293,537 units in June, the 11th straight mth of increase, as government incentives boosted demand. Passenger car sales rose 21.0% YoY to 265,925 units
TODAY’S EVENTS
DAILY VIEW
Conferences
· Thursday July 1:
o Citi Malaysia Investor Conference- 07/01/10 - 07/02/10 London, GB
o JPMorgan Asia Pacific Conference- 07/01/10 - 07/02/10 London, GB
o SEMI PVJapan Conference- 06/29/10 - 07/01/10 Yokohama, JP
Company Meetings/Other Daily Events
· Thursday July 1:
o Shareholder Meetings
§ MENT
o GIS investor day
o U.S. vehicle sales are seen slipping- Barron’s
o Allianz holds a capital markets day
o Markets are closed in Canada, Hong Kong and Thailand
o Europe's financial-stability facility -- emergency loans for euro-zone countries -- is expected to be activated- Barron’s
Economics
· Thursday July 1:
o 0830 Unemployment Insurance Weekly Claims Report
o 1000 DJ-BTMU U.S. Business Barometer
o 1000 Construction Spending
o 1000 Pending Home Sales Index
o 1000 ISM Manufacturing Report on Business
o 1030 EIA Weekly Natural Gas Storage Report
o 1630 Money Stock Measures
o 1630 Federal Discount Window Borrowings
o Domestic Auto Industry Sales
Earnings
o Industrials/Homebuilders
§ Thursday July 1: FLOW, MSM
o Consumer/Retail/Education
§ Thursday July 1: STZ, FC
o Tech/Telecom
§ Thursday July 1: MEI, MXB, DMAN, UNFY
INVESTMENT BANKING WRAP
M&A
· Private Equity $500B cash stash- NYPOST
o Private-equity firms sitting on $500 billion of uninvested cash and facing a deadline for spending it are nonetheless taking their sweet time making deals -- much to the chagrin of sellers eager to do a deal before capital-gains tax rates rise next year.
o One reason behind the troubled auctions is that the shaky economy is making it hard for PE to value these companies. Also, the sellers are not budging from their demands for premium prices while the prospective buyers are looking for bargains.
· BP eyes sale of its Argentinian stake- DailyMail
o Beleaguered energy giant BP has pinpointed a huge stake in an Argentinian oil producer as a prime candidate for a sale aimed at bolstering its finances
o Selling BP's entire 60pc stake in Pan American Energy could bring in more than £6bn - meaning that in one fell swoop it would come close to a target of raising £6.6bn through asset sales this year
o http://www.dailymail.co.uk/money/article-1290970/BP-eyes-sale-Argentinian-stake.html#ixzz0sQB8gPwt
· Oil spill should accelerate offshore driller deals- Reuters
o The offshore oil drilling sector has long been seen as ripe for consolidation. But the conditions created by the oil spill should accelerate deals, as it becomes tougher for smaller drillers to compete.
o http://www.reuters.com/article/idUSN3021816020100630
· WPO- 2 Suitors for Newsweek Are Said to Be Ruled Out- NYT
o The Washington Post Company has rejected overtures from the owners of Newsmax, the monthly conservative magazine, and Thane Ritchie, an Illinois hedge fund manage
o Two wealthy businessmen are moving ahead with their bids: Sidney Harman, the audio equipment magnate, and Fred Drasner, a former publisher of The Daily News of NY
o http://www.nytimes.com/2010/07/01/business/media/01newsweek.html
· ABB Won’t Match EMR Offer for Chloride, Dropping Bidding- BBG
o “While we still see considerable value in the combination of ABB and Chloride and have a high regard for the Chloride management team, we must take a disciplined approach when assessing potential acquisitions,” said the CEO
· URS Agrees to Buy Scott Wilson With Higher Bid as CH2M Bows Out- BBG
o URS Corp., a U.S. engineering- advisory company, agreed to buy U.K.-based Scott Wilson Group Plc after sweetening its offer to about 223 million pounds ($333 million) to trump a competing proposal from CH2M Hill
o Closely held CH2M of Englewood, Colorado, said it withdrew its bid.
· Telefonica primed to fight Portuguese veto on Vivo- Reuters
o Telefonica on Thursday urged the Portuguese government to lift its veto on the sale of a stake in Brazilian mobile group Vivo by Portugal Telecom and signalled it was ready to fight the issue in court
o http://www.reuters.com/article/idUSLDE6600F520100701
· Portugal Telecom seeks clarification on Vivo sale- Reuters
o Portugal Telecom said on Wednesday it will seek legal clarification on a decision by the government to veto the sale of its stake in Brazilian mobile phone company Vivo against the wishes of shareholders
o http://www.reuters.com/article/idUSLDE65T2HS20100630
· M&M eyes BA Boeing in Australia- Business Standard
o The US-based Boeing is present in 17 locations in Australia; its divisions there include aerostructures, commercial aeroplanes and defence products, among others. The facility M&M may buy is either a components or aircraft manufacturing facility.
o Mahindra said “Boeing is one of the companies we are in talks with, but I am not going to comment on any specific deal. We are also in talks with Airbus and others to take advantage of the offset clause.”
o http://www.business-standard.com/india/news/mm-eyes-boeing-in-australia/399972/
· LGF- Witching Hour comes and goes for Icahn’s Lions Gate Bid- Dealbook
o Time is running out for Carl C. Icahn’s hostile tender offer for Lions Gate Entertainment — but do investors really care?
o The $7-a-share offer is set to expire at 11:59 p.m. Eastern time on Wednesday. Mr. Icahn, who extended the offer several times in the past, has said that this time the game is over
o http://dealbook.blogs.nytimes.com/2010/06/30/witching-hour-nears-for-icahns-lions-gate-bid/
· DCP DynCorp Shareholders Approve Buyout- Dealbook
o DynCorp International said Wednesday that shareholders had approved the company’s acquisition by private equity firm Cerberus Capital Management
o Dyncorp said that 88 percent of outstanding shares voted to approve the $1 billion deal the company announced in April. It said it expects the acquisition to close by July 7.
o http://dealbook.blogs.nytimes.com/2010/07/01/dyncorp-shareholders-approve-buyout/
· Panasonic Ups LCD Stake- WSJ
o Panasonic. has gained almost full ownership of a liquid-crystal-display joint venture with Hitachi, as it gears up to better compete with rivals such as Sharp and Samsung
· AMZN Amazon to acquire online store Woot- Reuters
o Amazon.com said it signed an agreement to acquire online store Woot.com, which sells discounted products and operates an online community, for an undisclosed sum.
o The Carrollton, Texas-based company with an irreverent edge offers a new item every day for sale until it is sold out and a new item takes its place.
o http://www.reuters.com/article/idUSN3026000120100630
· IBM buys stake in China's Bright Oceans for $50m- reuters
· COP ConocoPhillips Sells Stake in CFJ Properties Flying J truck stops to Pilot Travel Centers for $626m- BBG
o The sale is consistent with ConocoPhillips’ overall U.S. marketing strategy, which is to minimize company ownership of motor fuel stations while securing long-term markets for refined products from ConocoPhillips refineries
o http://www.reuters.com/article/idUSN3019383220100630
· Santander's Moves Puzzle Investors- WSJ
o Banco Santander SA's stock is down, the cost of insuring its debt against default has jumped and questions about the health of its home market are rampant.
o Yet, Last month, Santander paid $2.5 billion for the remaining 25% of its Mexican business. Last week, it spent $3.16 billion for a portfolio of auto loans from Citigroup Inc.'s U.S. auto-finance unit. It is the sole bidder for 318 U.K. branches of Royal Bank of Scotland Group PLC, for which it is expected to pay around £1.8 billion ($2.71 billion)
· RA RailAmerica Buys Atlas Railroad Construction Company for $21.5m- BBG
o RailAmerica to buy Atlas Railroad Construction and related assets for $21.5m cash plus closing adjustments for working capital est. ~ $2.5m. The deal is Expected to close today
· CKR CKE Restaurant. Announces Stockholder Approval of Merger with Apollo Management- BBG
o Of the shares that were voted at the meeting, approximately 99% were voted to approve the proposal to adopt the merger agreement
· EXL Excel Trust acquires properties for $71.7M- BBG
· SSD Simpson Manufacturing to sell unit's assets for $20 mln- Reuters
o Simpson Manufacturing(a maker of venting systems for gas and wood burning appliances, said it agreed to sell the assets of its subsidiary to Netherlands-based M&G Holding B.V. for about $20 million in cash
o http://www.reuters.com/article/idUSSGE65T0JZ20100630
· Tate & Lyle sells sugar business for £211m- FT
o Tate & Lyle has agreed to sell a large part of its sugars operation to American Sugar Refining of the US for £211m in a deal that cuts many of its historic ties with the business on which the UK group was founded
o http://www.ft.com/cms/s/0/cd56ca0a-8492-11df-9cbb-00144feabdc0.html
· Providence buys Australia's Study Group for $570 mln- Reuters
o U.S. private equity firm Providence Equity Partners has acquired university programme provider Study Group from Australia's CHAMP Private Equity for $570 million
o http://www.reuters.com/article/idUSSGE66006G20100701
· Australia's CHAMP says to buy ATF Services- Reuters
o Australia's CHAMP Private Equity has agreed to buy temporary fencing provider ATF Services from Sydney-based Quadrant Private Equity
o CHAMP, which earlier announced it had sold university programme provider Study Group, did not disclose financial terms
· SocGen in Talks With Econocom With View to Sale of ECS- BBG
o Societe Generale SA said that it’s in exclusive talks with Econocom Group SA with a view to selling its ECS information-systems management unit.
o Econocom’s bid values ECS at 210m euros, Societe Generale said in an emailed statement. Societe Generale would take a 9% stake in Econocom as part of the accord.
· National Envelope gets $140 mln CVO Cenveo buyout bid- Reuters
o NEC Holdings, which said it is the largest U.S. envelope maker and is operating under bankruptcy protection, is the subject of a $140 million takeover bid by rival Cenveo
o http://www.reuters.com/article/idUSN3024556820100630
· E.ON to Sell Stake in Swiss BKW to BKW and Groupe E – BBG
o E.ON Energie AG, a unit of Germany’s largest utility, plans to sell its stake in BKW FMB Energie AG to BKW and Groupe E AG for 526 million euros ($643 million) following a “reassessment” of its strategy.
o BKW is paying 64.30 Swiss francs a share, or 304.3 million francs ($284 million) in a first step. E.ON is selling a total stake of about 21 percent.
· Posco in bid for Anglo American coal assets in Australia- The Australian
o Posco, the world's fourth-largest steelmaker by output, and state-run Kepco are bidding for the Bylong and Sutton Forest exploration assets in the Sydney Basin of New South Wales state, the sources, who declined to be named
· Mazda CEO says wants China JV with 50 pct stake- Reuters
o The head of Mazda Motor said on Thursday he wanted a joint venture in China in which the Japanese automaker would hold the maximum 50 percent allowed instead of the 15 percent it now owns in a three-way venture
o http://www.reuters.com/article/idUSTFD00646420100701
· Sumitomo buys stake in Usiminas unit for $1.93 bln- Reuters
o Usimina, Brazil's largest maker of flat steel, said it is selling 30% of its mining unit to Japan's Sumitomo for $1.93b , in a bid to raise cash to develop its fast-growing iron ore assets
o http://www.reuters.com/article/idUSN3019651420100701
· Fortis tops Khazanah offer for Parkway- Business Times
o Fortis Healthcare, India’s second-biggest hospital owner, offered about S$3.2 billion (US$2.3 billion) for the rest of Singapore’s Parkway Holdings Ltd, topping a partial bid by Malaysia’s sovereign wealth fund.
$ RAISING
IPOs
· AgBank HK offer 10 times oversubscribed by institutions- reuters
o Agricultural Bank of China's Hong Kong share offering has been more than 10 times oversubscribed by institutional investors, signalling their healthy interest in the dual-market listing that could end up being the world's largest ever
o http://www.reuters.com/article/idUSTOE66004E20100701
· IPO Filings Hit Post-2007 High Amid Losses; LBO Firms Seek Cash- BBG
o U.S. companies are getting set for the biggest wave of initial public offerings since the last bull market at the same time that IPOs get canceled at the fastest pace since the collapse of Lehman Brothers Holdings
o Investors in U.S. IPOs lost 7.2 percent so far this year as the Standard & Poor’s 500 Index fell to an almost nine-month low
· WLS Welsh Property Trust IPO pulled on market conditions- Reuters
o Minnesota-based Welsh Property had already shelved its IPO plans earlier this month citing the same reason, then filed revised terms and restarted the process on Monday, and was expected to price on Wednesday after the market close.
· Elevation Invests Another $120 Million in Facebook as that IPO Looks More Distant- Tech Crunch
o Elevation Partners has quietly amassed another huge chunk of Facebook shares on the secondary market. Elevation spent $120 million for five million more Facebook shares
o There are a few good reasons for a company to go public. An IPO can net a company a lot of cash, allow employees to get liquidity on their shares, and give a privately-held company a frequently-priced stock currency it can use for acquisitions. But Facebook has managed to do a lot of that with the secondary market, and it can still control who buys its stock.
· Some IPOs pulled this week…
o Yesterday and IPO Withdrawal … MX MagnaChip Semiconductor Corp 7.5m share IPO expected to price 6/30 via Barclays, GS, and DB: Price Talk $15.50-17.50
1. Withdrew IPO citing adverse market conditions
o WLS Welsh Property Trust 38.5m share IPO expected to price this week (wk of 6/27): Pricce talk $8.50-10.50.
§ IPO pulled citing market conditions.
PRICINGS
· Initial Offerings
o AMAP AutoNavi 8.6m share IPO priced at top of range at $12.50 via GS
o ECT ECA Marcellus Trust 8.8m share IPO priced in the range at $20 via Raymond James and Citi
o MX MagnaChip Semiconductor Corp 7.5m share IPO expected to price 6/30 via Barclays, GS, and DB: Price Talk $15.50-17.50
§ Withdrew IPO citing adverse market conditions
· Secondary Offerings
o ONFC Oneida Financial- to sell 3.94m shares at $8/shr via Stifel Nicolaus & Co.
o SPU SkyPeople Fruit Juice- 5.3 million shares expected to price Wednesday via Rodman & Renshaw LLC.
o ISLE Isle of Capri Casinos- 9 million shares expected to price Thursday via Credit Suisse and Deutsche Bank.
NEWS
· Teachers rejects Maple Leaf Foods rights plan- Reuters
o Ontario Teachers' Pension Plan, the largest stakeholder of Maple Leaf Foods, said on Wednesday it would oppose the Canadian food processor's adoption of a shareholder rights plan, used by companies to protect against takeovers
o http://www.reuters.com/article/idUSN3022022020100630
· Healthcare: PVCT Provectus Pharmaceuticals files $50M equity shelf
· Media: LEE Lee Enterprises files $750M mixed securities shelf registration
· Financials: IBCA Intervest Bancshares files $46M equity offering through Sandler O'Neill
· Tech: CYDE CyberDefender files $40M mixed shelf
· ISLE Isle of Capri postpones common stock offering
· AEZS Aeterna Zentaris files $85M equity shelf registration
· JACK Jack In The Box enters new credit agreement
***All eco data from Bloomberg and DJ
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