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Morning @ Cantor

Market Commentary

Morning Comment

Pado's Perceptions

News

o Fed's Lacker says US recovery looks sustainable from Business Spectator

� Says weak housing, employment won't derail recovery.

o China vows policy stability, backs euro from Business Spectator

o No Catastrophes From Europe Stress Tests Expected: Juncker from DealBook

� There should be no "big catastrophes" from stress tests on European banks but the reviews should be tough, the chairman of euro zone finance ministers, Jean-Claude Juncker, was quoted as saying, Reuters said

o IMF chief sees European banks safe in stress tests

� (Reuters) - Stress tests being conducted in the European Union will show that all the major European banks have sufficiently capital, International Monetary Fund chief Dominique Strauss-Kahn told a French television station.

o Stress Tests Won�t Force Share Sales at Big Banks, Goldman Says - BBG

� Stress tests of European banks aren�t likely to force major publicly listed lenders to bolster their capital by selling new shares, analysts at Goldman Sachs Group Inc. said.

� �We do not expect large listed European banks to raise equity as a result of the stress tests,� London-based Goldman Sachs analysts, including Jernej Omahen and Frederik Thomasen, wrote in a report to clients dated today.

� Overseas Action

o European stocks up half percent

� Leading: Manufacturing +1.55%...Mining +1.46%...Auto Parts +1.34%...Auto Manufacture +1.23%

� Lagging: Electric -1.20%...Pharma -0.62%...Water -0.53%...Building Materials -0.49%

� After the well is capped and oil has stopped flowing, BP is the 6th best performer in Europe +3.77%.

o Asian Markets: Nikkei (2.86%); Hang Seng (0.03%)..shanghais flattish

� China gives little indication of pushing back stimulus exit - TTN

� Stronger yen hurts Japan

� Agricultural Bank of China (601288.CH/1288.HK) led banks higher, rising 2% on its trading debut in Hong Kong vs a 1% rise from its offer price when it debuted in Shanghai yesterday

o Data:

� Euro Zone Trade Balance: -�3.4B v -�500Me

� CHILE CENTRAL BANK RAISES OVERNIGHT RATE TO 1.50% VS 1.00%

o Economics today:

� CPI m/m (Jun) SA Consensus (0.1%) at 08:30 ET

� ex-food & energy (Jun) SA Consensus 0.1% at 08:30 ET

� TIC Flows (May) at 09:00 ET

� U. of Michigan Confidence (Jul-Prelim) SA Consensus 74.5 at 09:55 ET

o Earnings:

� Companies due to report before the bell include: BAC, C, COL, FHN, GCI, GE, GPC, GPC, MAT

o AAPL anncmt at 1PM ET Today

o Vote on Jobless Benefits Will Follow Swearing-In for Byrd's Successor from Roll Call

� The successor to the late Sen. Robert Byrd (D-W.Va.) will be sworn in Tuesday afternoon, and the chamber will then hold a procedural vote on an unemployment insurance measure, Senate Majority Leader Harry Reid said Thursday.

o Reid Says Obama to Sign Financial Overhaul Next Week: BBG

TODAY�S BIG STORIES

� Top M&A

o SMTB Smithtown Bancorp to be acquired by People's United (PBCT); PBCT announces Q2 earnings

� Top $ Raising

o RLD RealD 12.5M-share offering priced at $16/share through JPMorgan and Piper Jaffray��

� offering was expected to be only 10.8M shares priced in the range of $13-15/share.

o QLIK Qlik Technologies 11.2M-share IPO priced at $10/share through Morgan Stanley, Citi, and JPMorgan

� �offering was expected to price in the range of $8.50-9.50/share.

o Agricultural Bank of China (601288.CH/1288.HK) led banks higher, rising 2% on its trading debut in Hong Kong vs a 1% rise from its offer price when it debuted in Shanghai yesterday

o Station Casinos Can Send Bankruptcy Exit Plan to Vote - BBG

� Station Casinos Inc., the biggest U.S. gambling company in bankruptcy, can send its reorganization plan to creditors for a vote, a judge ruled

� U.S. Bankruptcy Judge Gregg Zive in Reno, Nevada, said today that the disclosure statement for the company�s plan contains enough information for creditors to decide whether to support it

o Harrah�s� Bloomberg) -- Harrah�s Entertainment Inc., the world�s biggest casino owner, expects to list some shares publicly in coming months because of the deal owners Apollo Management LP and TPG struck with billionaire John Paulson.

� Credit Markets:� Bank Bonds Beat Industrials as Bill Advances � BBG

o Bank bonds are outperforming debt from industrial companies by the most since March as investors wager the biggest overhaul of Wall Street regulations since the Great Depression won�t cripple profits at financial firms

o U.S. bank bonds returned 1.35 percent this month, the second-best performing class of investment-grade debt after tobacco companies, compared with a gain of 0.5 percent for industrial companies

� Fed Watch:

o Fed's Balance Sheet Grows; Money Supply Falls � CNBC link on latest week�s data reported thurs night �.

� Fed reports balance sheet assets of $2.344T on Wednesday, +$8.7B w/w and +$269.3B y/y�

o Fed Nominees Support Expanded Duties from DealBook

� President Obama's three nominees to the board of the Federal Reserve said they were prepared to help the central bank handle its vastly expanded duties to ensure financial stability and oversee financial institutions

� Money Flows:� Investors More Interested in Buying Corporate Debt Than Equity. Corporate Bond Funds Get 0.4% of Assets in Past Week, While U.S. Equity Funds Lose 0.1% of Assets.

o What is striking is how much retail investors prefer corporate debt to equity. The U.S. equity funds we track daily lost 0.1% of assets in the past week, while the Corporate bond funds we track daily received 0.4% of assets. This big disparity occurred even though the average U.S. equity fund�s 1.3% gain in the past two weeks trounced the performance of the average Corporate bond fund, which suffered a loss of 0.1%. TRIMTABS

o So far this year, U.S. equity fund flows have been virtually flat, while Corporate bond funds have posted an inflow of 7.1% of assets, almost as much as the 8.2% of assets that has flowed into Treasury bond funds.

� Money Flows:�

o June Equity Fund Inflows $2.8 Bil; Taxable Bond Fund Inflows $16.9 Bil

o xETFs - Equity Fund Outflows -$4.6 Bil; Taxable Bond Fund Inflows $11.9 Bil

o per AMG

� Economists Express More Optimism Than General Public � WSJ

o Economists surveyed by The Wall Street Journal are more optimistic about the direction of the economy than the general public, though they are revising down forecasts for growth and jobs for the next 12 months.

o The majority (64%) of the 55 economists polled�not all of whom answer every question�said that the economy would get better over the next 12 months and 9% said it would get worse; the rest said it would stay about the same. In contrast, the latest WSJ/NBC News poll found 33% of the general public expected the economy to improve and 23% think it will get worse.

o http://online.wsj.com/article/SB10001424052748703722804575368871006939294.html?mod=WSJ_hps_LEFTWhatsNews

� Yuan Likely to Track Euro, Former Treasury Official Keidel Says - BBG

� China�s yuan is likely to track the euro more closely now that its peg to the dollar has been relaxed, said Albert Keidel, a former Treasury Department official and a senior fellow at the Atlantic Council

� Keidel, former acting director of the Treasury�s Asia office, said Chinese policy makers may decide to tie the yuan, also known as the renminbi, to a basket of currencies. If so, he said, the Chinese currency would follow movements in the euro, if not as closely as it previously tracked the dollar

� �Since the euro is quite low historically after the Greece scare, and it�s started to move up again, we�ve seen the renminbi strengthen a tiny bit,� Keidel said yesterday at an Atlantic Council forum in Washington. �If then we see problems with Greek and other debt and the euro tanks again, we might even see a very mild� devaluation of the yuan against the dollar

Deflation is a true danger confronting the world

o Deflation is excruciatingly difficult to reverse. Because of that, the U.S. Federal Reserve and the European Central Bank should make it clear that they would act to fend off deflation, according to The Economist. The problem is that the central banks have taken a lot of assets onto their books and driven interest rates close to zero, so traditional tools aren't going to be as effective as before. "Governments need to be acutely aware of this as they calibrate their austerity plans," The Economist notes. The Economist (15 Jul.)

� Buffett warns Obama U.S. economy only halfway back from Reuters

o President Barack Obama heard a sobering message from Warren Buffett when he asked for the investment guru's views about the economic recovery, according to an interview Obama gave NBC News on Thursday

� OPEC lifts demand for its oil for first time in three years from Telegraph

o OPEC, the 12-country oil cartel, expects demand for its petroleum products to increase for the first time in three years in 2011.

� Greenspan: Bush tax cuts should expire � The Hil link

o Former Federal Reserve Chairman Alan Greenspan said the ballooning budget deficit was the reason

� Interest rates won't rise yet, says Bank of England policymaker from Telegraph

o It would be wrong to raise interest rates now because the risk of only weak growth over a prolonged period is real, David Miles, a Bank of England policymaker said

� NYC Jobs:� Street jobs lift Gotham from NY Post

o New York City's unemployment rate fell for the sixth straight month in June -- fueled by job creation on Wall Street and by retailers, the state Labor Department said yesterday. The turnaround in the financial sector, which added 2,400 jobs last month, pushed dn the Big Apple unemployment rate...

� China to steer steady policy, backs euro zone from Reuters

o BEIJING (Reuters) - China will stick with the policies that cooled economic growth last quarter and will keep faith with the euro despite Europe's debt problems, Premier Wen Jiabao said on Friday.

� John Mack joins China's CIC as advisor from FT.com

o China Investment Corp, the country�s main sovereign wealth fund, has appointed John Mack, chairman and former CEO of Morgan Stanley, to its 14-member international advisory council

� Investors plan to flee funds of funds �

o More than a third of investors in funds of hedge funds plan to cut out the industry in future and move towards direct investment in single-name hedge fund managers, according to the results of a new survey, the FT reports. The single biggest reason for moving out of funds of funds cited by the poll�s respondents � who included pension funds, asset managers, banks, family offices and endowments � was fees. Pensions & Investments says the 2008 financial crisis could well have proved the tipping point for fund of funds.

� Basel Committee Agrees Bank Capital Buffer Strategy from CNBC

o global committee of banking supervisors published draft rules on Friday that will force banks to build up extra buffers of capital in good times but did not divulge what level of funds they would be required to hold.

o The committee said it was on track to deliver a complete package of capital and liquidity reforms, including design and calibration, in time for the November 2010 G20 leaders summit in Seoul.

� Fin reform:� Impact to Reach Beyond Wall Street from WSJ.com

o Key questions for business and consumers will remain unresolved until details of the new regulations are written

� Financial Transaction Tax Might Fix Host of Ills: Ralph Nader - BBG

o Why is Congress running away from a financial transactions tax? The intensifying struggle on Capitol Hill over revenue, spending and deficits, coupled with the widely felt, reckless behavior of Wall Street, would seem to provide an ideal atmosphere to debate a major source of new income that also helps to restrict rampant speculation

o A bill to impose such a tax, introduced by Democrat Representatives Peter DeFazio and Peter Welch, is going nowhere.

� GS Goldman Sachs has reached a settlement with SEC

o WSJ column says shares may may approach 1.5 times book value, or $200.

o GS WSJ looks at Goldman Sachs's settlement with SEC

o GS Goldman Sachs upgraded to buy from neutral at Bank of America Merrill Lynch; target increased to $182 from $160

o GS Goldman Sachs upgraded to outperform from perform at Oppenheimer..tgt 213

o Goldman Sachs reports 2Q10 earnings next Tuesday, July 20.

o Goldman SEC Settlement Vote Split Along Party Lines

o Goldman's Fine: 10.2 Market Days of Earnings from DealBook

o The news that Goldman Sachs had struck a settlement deal with the Securities and Exchange Commission was viewed by many on Wall Street as a something of a victory for the firm's chief, Lloyd C. Blankfein. NYT

� Citigroup and AIG classified certain repos as sales from Reuters

o BANGALORE (Reuters) - Citigroup Inc and AIG classified more than $11 billion in loans as sales in the second half of 2009, masking the companies' risk levels, filings with the U.S. Securities regulator showed.

� Citigroup said in a letter to the U.S. securities regulator it had unintentionally classified as much as $9.2 billion of repurchase agreements as sales at one point, when they should have been shown as borrowings, Reuters reported.

o In its letter dated April 13 to the U.S. Securities and Exchange Commission, which was made public on Thursday, Citi said the third quarter of 2009 had the largest amount of repurchase agreements accounted for as sales.

� BP issues Gulf of Mexico Update: Well integrity test is continuing on MC252 well. It is expected that no oil will be released to the ocean during the test. Even if no oil is released during the test, this will not be an indication that oil and gas flow from the wellbore has been permanently stopped

� Tech busy today:�

o AMD +4.5% (earnings) ..� numbers look good across the board.. strong margin results

o GOOG -4.2% ..

� GOOG- mixed Q on good top line growth from outperformance in Google websites and network partners. EPS was hurt by higher opex and capex numbers due to the ramping of the display business and the addition of 1200 employees in the Q. Paid clicks and cost per click increased y/y. In mobile GOOG said sale of android devices increased from 65k a day to 160k a day in the Q. GOOG still sees its emerging businesses (Display, mobile, and Apps) as �billion dollar opportunities.�

o GOOG on Macro: Company said there was no impact on its business in Q2 from the widely publicized macro headwinds. Google added that is confident about the future and that is why it is ramping up its investments. Russia, Brazil and India were highlighted as some of the outsized growers.

o PLCM -10.6% (earnings) � PLCM- Beat and raise Q2� some believe guidance, although better, could still be conservative

o E-gaming:� NPD reports June software sales of $531.3M, (15%) y/y vs Street (11.7%) - VentureBeat

o AAPL conf call today�.AAPL Apple doesn't plan to recall iPhone 4 -- WSJ

o Video Games:� NPD

o Sony Ericsson reports.. Sony Ericsson Q2 tops forecast, keeps outlook

� Sony Ericsson- better Q on strong ASP performance

o India�s Tata Consultancy (TCS.IN) jumped on beating estimates for Q1.

� We�re seeing that demand from the U.S. is very strong,� � per BBG

� Tata Consultancy joins smaller rival Infosys Technologies Ltd. in signaling demand for information-technology services is strengthening in the U.S

� Consumer:� MAT Mattel reports Q2 results � mixed

� Trucks:� JBHT JB Hunt Transport reports Q2 EPS better

� media:� GCI:� Expectations are that when Gannett , the largest U.S. newspaper publisher by total circulation, reports second-quarter results on Friday, it will show its rate of decline improving further.� WSJ

� VVUS -57.5% (FDA panel votes against recommending approval for Qnexa)

o OREX -11% (in reaction to FDA Qnexa votes)

o VVUS Vivus will hold conference call related to FDA Qnexa votes

� Is a Big Tax Break for Plaintiffs� Lawyers on the Way?� WSJ

o The U.S. Chamber of Commerce�s Legal Newsline reported on Wednesday that the U.S. Department of Treasury may be about to grant plaintiffs� attorneys long-sought tax write-offs for the costs associated with fronting contingency-fee lawsuits.

o http://blogs.wsj.com/law/2010/07/15/is-a-big-tax-break-for-plaintiffs-lawyers-on-the-way/

� Americans Blame Bush, Not Obama, for Deficit, Jobs, Afghan War - BBG

o Democrats, facing a U.S. electorate angry about the economy and other issues, still have one political asset: George W. Bush

o �The former Republican president is blamed more than President Barack Obama for the budget deficit, unemployment and illegal immigration, according to a Bloomberg National Poll conducted July 9-12

o �Most surprising is that 60 percent say Bush is primarily responsible for the current situation in Afghanistan. Just 10 percent point to Obama, who has ordered 51,000 additional troops to that country since taking office, doubling the number deployed by Bush.

� 2012 POLL: Obama trails against Romney, Gingrich, Huckabee; tied with Palin...

o No, this is not coming from Rasmussen or an internal GOP poll, but from the normally Democrat-sympathetic Public Policy Polling. PPP pitted Barack Obama against five potential Republican challengers for the 2012 presidential campaign, and the only one Obama beat was � Jan Brewer. Even that, PPP admitted, resulted from Brewer�s lack of name recognition. The headline, though, is Sarah Palin�s dead heat with the President

o trails Mitt Romney 46-43, Mike Huckabee 47-45, Newt Gingrich 46-45, and is even tied with Sarah Palin at 46

o It�s not that any of the Republican candidates are particularly well liked. Only Huckabee has positive favorability numbers at 37/28. Romney�s at 32/33, Gingrich at 32/42, Palin at 37/52, and Brewer at 17/20

o http://hotair.com/archives/2010/07/15/ppp-obama-palin-tied-4646-in-2012-polling/

China's sweetened deal on government contracts could aid U.S. firms

o China submitted a revised proposal to join a World Trade Organization agreement on government contracts. China's plan would open the door for U.S. companies to bid on Chinese government projects. Deputy U.S. Trade Representative Demetrios Marantis said the offer includes "significant improvements" compared with a 2007 proposal. China Daily (Beijing) (16 Jul.)

� Australia� Labor government will call an election tomorrow for 28-Aug

� Iran scientist was longtime informant from Reuter

o The Iranian nuclear scientist who says he was abducted a year ago by U.S. agents was an informant for the CIA inside Iran for several years, The New York Times reported on Thursday, citing U.S. officials.

� Afghanistan� (Reuters) - Secretary of State Hillary Clinton heads to Afghanistan next week for a crucial conference that U.S. officials hope will clarify the long-term goals of an expensive, unpopular and increasingly uncertain war.

� U.K. Is �Junior Partner� to U.S., Cameron Says Before Visit - BBG

o David Cameron, preparing for his first visit to the U.S. as U.K. prime minister, said he sees Britain as America�s �junior partner.�

o ��President Obama and I have a very good relationship, we get on well,� Cameron told Time magazine in an interview published today before next week�s trip to Washington. �I believe in the special relationship. Britain is, of course, the junior partner. I hope we bring things to that relationship.�

CANTOR TRADING RECAP

� Equity Recap

o Overnight, S&P futures fell a bit, perhaps in reaction to weaker than expected economic data from China (GDP, CPI, Industrial Production and Retail Sales all light). By 6:00 am, prices were back to flat and rising; at 8:30, we were again testing resistance at 1100. With the 8:30 release of domestic economic data, however, prices abruptly reversed and fell over 22 points. The only bullish statistic was the Initial Claims number (at 429k, the first print significantly below 450k in quite some time); this may have been due, however, to an anomaly in the Auto Industry (lack of normal seasonal factory shutdowns). Continuing Claims for Unemployment came in 234k worse at 4681k. The month over month PPI was -0.5% vs. an expected -0.1%, adding to deflation worries. In manufacturing, Industrial Production was a bit better, rising 0.1% vs. an expected decline of 0.1%. Both the Empire and Philadelphia Manufacturing Indices missed by a significant margin. At 1076.80, S&P�s turned back up and managed a slow rally until 3:00. Prices then faded, and it briefly looked as if the bears had a shot of taking out the lows. With word that AAPL would not recall the iPhone4, along with reports of an imminent settlement between GS and the SEC, and finally news from BP that NO oil is currently leaking, prices again reversed and we had a 14 point rally into the bell.

o There was little change in any of the 10 S&P groups: Utilities moved the most, up 0.6% (interest rates down again, with the long bond again rallying more than 1 point). The US Dollar again weakened, with the Euro rallying 1.5% to just shy of $1.30. Every commodity I track rose, except for Oil (off 42c, or .055%). Most of the big individual stock moves came after the bell: GOOG fell $21, or 4.2%, after reporting earnings, while GS rallied $8, or 5.5%, to 153.40. The settlement between GS and the SEC was announced after the bell: $550mm ($250mm to the aggrieved parties, $300mm to the US Treasury). The largest gainer during the regular session was NTY, which rose $16.27, or 43%, on news that it would be bought by Carlisle Group for $3.8B.

o Billy Clark and Team

� Investment Grade Recap

o IG spreads were mixed to slightly softer today in some of the best volume all week as we continue to have better buyers across the board.� Spreads are going out off their intra-day lows but still a little softer on the day.� The GOM was softer by a half point to a point in the morning but is going out over a point better on BP stopping the flow of oil into the gulf.� More positive at the end of the day with Goldman settling with the SEC for $550 million, and JPM beat before the market opened.

o We traded a good mix of names today � EOG, PCG, DHR, APC, BPLN, among others.� More off the run names like DHR, SWK, and CBE have seen a good amount of buy interest and we remain axed buyers of the that type of paper, 4-10yrs.� UTX 4.50 20 still trading about as tight as anything in my sectors, +54-49/10yr today for a true ten year.

o Economic data was far from pretty today with the New York Fed summing it up best, as �the pace of growth in business activity slowed substantially� and the capital expenditures index dropped to its lowest level in a year.� The survey came in at 5.08 v 18.00 expected and v 19.57 last month.

o Should be interesting how we are when we walk in tomorrow on the heels of the late day positives, still few are giddy about spreads and I do not hear the word �cheap� too often with spreads where they are, more buyers of need because of the amount of cash to be put to work.� Still at some of these levels it is hard to see how much tighter the higher quality can go.� Only new issues today were JPM in a two part $4+BN deal and Bank of Nova Scotia in a $2.5BN deal.

o Michael Salemo

CMBS Recap

o Selling remains very light with only $185mm in BWICs; however, seeing a pickup in buy interest with the focus on Tier 1/2 paper throughout the credit curve.� We remain positive on CMBS up in cleaner credits (dupers, '05/'06 AMs, '05 AJs and seasoned credit).� Seeing a pickup in Tiering with Tier 2 paper finally out performing GG10s.� GG10s were a couple bps better on the day finishing +370/$98-24.

o In the AM/AJ space $24mm in BWICs off of which we bought $5.5mm WBCMT 05-C21 AJs (89-08/90-00 mkt).� We continue to be in search of Tier 1/2+ AM paper.� In a slow growth environment/low rates, '06 AMs with 8+% yield seems like a good return.� On the negative side, MSC 06-IQ12 AMs got hit with an interest shortfall due to a massive loss on Hew Horizon's Apts.� Though it looks like a one month phenomenon, shortfalls will be the stroy of '10/'11, especially in '07 AJs.��

o Geordie Walker

Rates Commentary

o The Treasury market opened up well bid overnight but quickly erased much of these gains as the New York session opened. A poor overall showing of data today, PPI significantly tamer than expected -.5% MoM versus an expected -.1%, Empire manufacturing 5.08 vs. expected 18, and Philly Fed 5.1 versus an expected 5.1 coupled with yesterday's FOMC minutes and the post auction relief rally all aided in the US Treasury market well bid and almost a straight shot higher throughout the morning session, the 2 year note traded at a record low yield of .58%. Treasury market settled in once the afternoon session started trading a tight range near its intraday highs throughout. At 3PM the market was higher in price across the curve with the intermediate through long end leading the market higher as their yields were all ~7bps lower on the session.

o The much anticipated CPI report will be released tomorrow with expectations for -.1% MoM, 1.2% YoY. Given today's PPI, the continued growth concerns, and tomorrow's tame expectations we remain positive on Treasuries favoring the long end to outperform.

o Primary Dealer

o BP stops leak from stricken gulf well

o BP issues Gulf of Mexico Update: Well integrity test is continuing on MC252 well. It is expected that no oil will be released to the ocean during the test. Even if no oil is released during the test, this will not be an indication that oil and gas flow from the wellbore has been permanently stopped

o Oil Majors' Search for Growth Is Costly � WSJ link

o CAM Cameron International upgraded to Conviction Buy from neutral at Goldman Sachs

o DNX.LN Dana Petroleum provides exploration & drilling update

o Energy tax increases probably coming in Russia � FT

o Cramer removes SandRidge Energy (SD) from the Sell Block, noting that short-selling pressure is set to subside with the upcoming closing of the company's acquisition of Arena Resources (ARD). He adds that analysts are also likely to step up and recommend the combined entity. He goes on to praise management for its diversification strategy just as competition in the natural gas market is heating up.

o Goldman Sachs upgrades MUR; downgrades HES

o BP BP accelerates asset sale - FT

o SE Spectra Energy to acquire Bobcat Gas Storage assets and development project for $540M

o SCUEF Storm Cat Energy announces resignation of CEO Joseph Brooker effective 31-Jul��

o OKE ONEOK, Inc increases quarterly dividend by 4.5% to $0.46 from $0.44

o EEE Evergreen Energy Inc names William Gibson chairman

o Energy tax increases probably coming in Russia � FT

o U.S. is moving toward more jobs in green manufacturing, Obama says

� President Barack Obama said only 2% of U.S. jobs are in green manufacturing, but he has policy to change that. He said at the groundbreaking of a battery plant in Holland, Mich., that the country is headed in the right direction, with the manufacturing sector rebounding. The Grand Rapids Press (Mich.) (15 Jul.) , The Washington Post (16 Jul.) , Detroit Free Press (15 Jul.)

o OMNI �announces expiration of "Go Shop" provision of merger agreement with Wellspring

o BP Spill Undermines SunPower, Vestas as Bill Delayed - BBG

� SunPower Corp. and Vestas Wind Systems A/S, the biggest solar-panel supplier in the U.S. and the world�s largest wind turbine maker, are losing more than Big Oil from BP Plc�s spill in the Gulf of Mexico

� Their shares have fallen as much as 22 percent since the leak began April 20, compared with a 12 percent decline in the 52-member Bloomberg World Oil & Gas Index that includes BP.

INDUSTRIALS

o Boeing, Airbus Rival Seeks Bragging Rights from WSJ.com

� Canada's Bombardier, long known as a maker of small planes for short hauls, will soon face a key test as it takes on Boeing and Airbus in the market for midsized jets

o Airbus, Boeing �Cozy� Duopoly Starts to Crack as Rivals Attack - BBG

� For more than a decade, Airbus SAS and Boeing Co. had only each other to watch

� Now rivals from Canada, China and Russia are developing models to break into the narrow-body segment, dominated by about 10,000 Airbus A320s and Boeing 737s in operation and 4,000 on order. The single-aisle jet market will likely reach $1.68 trillion over the next 20 years, Boeing estimates

� �This cozy world of just the two of us is almost over,�

� Boeing Chief Executive Officer Jim McNerney said in an interview. �We�re still going to compete like crazy. If you think you had to meet promises with two guys, think about when you�ve got five.�

o Wesley Bush is steering Northrop Grumman in a new direction from L.A. Times

� In the six months since Wesley Bush's first day as CEO, and with this week's announcement that he may abandon the shipbuilding business, military giant Northrop Grumman has become a very different company

� Since taking the helm of Northrop Grumman Corp. in January, Wesley G. Bush hasn't wasted any time shaking up one of the world's largest military contractors.

o Komatsu to double FY output on Asia demand - BBG

o AVII +34.9% (DoD contract)

o VMI Valmont reports Q2 EPS

o ORN Orion Marine Group announces project award of ~$26M

o TGP Teekay LNG Partners to sell ~1.7M units to an institutional investor for ~$51M

o BEST Shiner International CFO Jeffrey Roney resigns

o PWX Providence and Worcester confirms certain matters with respect to MBTA and Motive Power

o KBR KBR announces contract award

o TNK Teekay Tankers makes accretive investment in first priority ship mortgage loans

o FTEK Fuel-Tech names David Collins as CFO

o NOC Northrop Grumman changing under Wesley Bush's leadership - LA Times

o HON Honeywell gets antitrust clearance from FTC to acquire Sperian

o Chloride Group provided interim statement and noted that sales were ahead of the prior year

TRANSPORTS

o Trucks:� JBHT JB Hunt Transport reports Q2 EPS better

� JBHT reported� EPS of $0.40 ..above Consensus $0.35e. Upside driven BY BETTER volumes, yields/pricing�and better operating margins

TECH/MEDIA/TELECOM

o GOOG- mixed Q on good top line growth from outperformance in Google websites and network partners. EPS was hurt by higher opex and capex numbers due to the ramping of the display business and the addition of 1200 employees in the Q. Paid clicks and cost per click increased y/y. In mobile GOOG said sale of android devices increased from 65k a day to 160k a day in the Q. GOOG still sees its emerging businesses (Display, mobile, and Apps) as �billion dollar opportunities.�

o AMD- better Q2 on strong top line growth. Revs got a big boost from strong graphics chip sales and notebook processor sales. The strong demand created a good pricing environment which cause margins to be better in the Q. AMD stated it will delay the launch of its Llano mainstream CPU-GPU �Fusion� platform from early 1H11 to late in 2H11 as its foundry partners have been experiencing yield issues on the 32-nanometer process node. Guidance still looks strong as mgmt called for season (5-10%) growth in the Q. the move to 32nm hurt EPS in Q2 and may continue to do so in Q3 on higher opex numbers

o Tata Consultancy- better Q as outsourcing continues to increase. Top line growth and better margins helped to drive the Q. Tata says it looks as though things a turning as tech firms are seeing an increase in spending. Mgmt said demand in the US is very strong. The company is in talks to add 15 �large� services contracts according to mgmt. TCS has raised its gross employee hiring target for FY11 from 30,000 to 40,000.

o Sony Ericsson- better Q on strong ASP performance. currency effects and better product mix helped to drive ASPs. The strong ASP performance helped to offset weaker units in the Q. GMs were a slight disappointment in the Q.

o FCS- Beat and Raise Q. strong rev growth drove the beat although surprisingly FCS PC sales came in weaker than expected. FCS paid down $27m of debt in the Q and plans to pay down another $122m in Q3. Orders were strong in Q2 inparticular in the Autos, Handsets, and consumer segments which helped to drive the top line growth,

o PLCM- Beat and raise Q2. Another story of top line growth and margin beats driving above analyst expectations. Voice was the big positive providing 7.5% growth q/q. With voice performing better some believe guidance, although better, could still be conservative and have room to the upside.

o NPD Gaming data

� Industry: U.S. video game industry sales in June fell 6% to $1.1b from $1.17b a year ago, but all categories were up from May�s levels

� Hardware: MSFT�s Xbox 360 and SNE�s PS3 drove hardware sales up 88% and 85% YoY respectively. NTDOY�s Wii sales rose 17% YoY

� Software: sales were down 15% YoY.TTWO�s Red Dead Redemption was the best selling game in the month, but ATVI�s upcoming release of Starcraft 2 could spark a turnaround in software sales

o AAPL, HPQ, PALM: Apple attempted to purchase Palm, was outbid by HP- AppleInsider

o AAPL: has no plans for iPhone 4 recall- AppleInsider

o AAPL: iPhone 4 antenna issues due to 'weakness' in software, may be fixable - NYT

o AAPL, Foxconn: Foxconn denies receiving Apple labor cost subsidy- National Business Daily

o ERTS Electronic Arts exiting France's Ubisoft- Reuters

o NWSA MySpace acquiring Threadbox's team and assets - VentureBeat

o CVC, T Rainbow Media reaches carriage agreement with AT&T

o DOX Amdocs initiated equal-weight at Barclays Capital; target is $33.

o VOD Vodafone may pay $750M over fair market price to buy part of Essar Group's stake in Indian JV - Business Standard

o TSM Taiwan Semiconductor to hire 8K people, half engineers, for new chip plant in Taichung - WSJ, citing executive

o DRAM: Contract quotes for DDR3 chips drift lower in early July- Digitimes

o DRAM: DDR1 sees significant demand in spot market- inSpectrum

o PCBs: Global PCB industry to grow more than 12% in 2010- Prismark

MATERIALS

o North American Steel Mills Cutting Output from TheStreet.com

� North American steel mills are cutting production in response to decreased order levels in response to fears of a surge in imports on the back of a potential slowdown in Chinese steel consumption.

o TCK Teck Resources reported that work continues at the Greenhills mine's coal dryer building

o MTX Minerals Technologies CFO John Sorel to be succeeded by VP, Business Development and Treasury, Douglas Dietrich

o MSB Mesabi Trust declares a distribution of $0.80 per unit of beneficial interest

o MT ArcelorMittal upgraded to hold from sell at UniCredit - SA

AUTOS

o GM's IPO May Require Hefty Incentives from BusinessWeek

o Nissan Motor to halt production in US, after all � FT

o Striking workers at Honda China supplier demand apology from Reuters

� Striking workers at a plant supplying parts to Honda Motors' China operations have issued a long list of demands for returning to work, aiming to win better conditions commensurate with China's rising economic clout.

o Toyota to Build Brazil Plant from WSJ.com

� Toyota will build a second auto assembly plant in Brazil, speeding up its shift in focus toward emerging markets as recalls limit its growth potential in the U.S.

o TXIC -4.6% (unable to publish f09 financials by extended 15-Jul deadline)

FINANCIALS

o Reid Says Obama to Sign Financial Overhaul Next Week: BBG

o US Senate passes landmark financial reform � FT link

o KKR shares in low-key market launch � FT link

o Basel Committee Agrees Bank Capital Buffer Strategy from CNBC

� global committee of banking supervisors published draft rules on Friday that will force banks to build up extra buffers of capital in good times but did not divulge what level of funds they would be required to hold.

� The committee said it was on track to deliver a complete package of capital and liquidity reforms, including design and calibration, in time for the November 2010 G20 leaders summit in Seoul.

o Financial Transaction Tax Might Fix Host of Ills: Ralph Nader - BBG

� Why is Congress running away from a financial transactions tax? The intensifying struggle on Capitol Hill over revenue, spending and deficits, coupled with the widely felt, reckless behavior of Wall Street, would seem to provide an ideal atmosphere to debate a major source of new income that also helps to restrict rampant speculation

� A bill to impose such a tax, introduced by Democrat Representatives Peter DeFazio and Peter Welch, is going nowhere.

o Lobbying shifts to regulators after Congress passes the financial bill

� With congressional action finished on the biggest overhaul of financial regulation in the U.S. since the 1930s, the financial industry is turning its attention to regulatory agencies that would implement the rules. Major lobbying organizations that represent the financial sector said they plan to work closely with the agencies. Sen. Christopher Dodd, D-Conn., chairman of the Senate banking committee, said there is always the possibility that Wall Street lobbyists would weaken the legislation in the rule-making process. Bloomberg (16 Jul.)

o Fin reform:� Impact to Reach Beyond Wall Street from WSJ.com

� Key questions for business and consumers will remain unresolved until details of the new regulations are written

o GS Goldman Sachs has reached a settlement with SEC

� Goldman settles Abacus with the SEC �� FT link

� WSJ column says shares may may approach 1.5 times book value, or $200.

� GS Goldman Sachs reiterated buy at Deutsche Bank; the target is $205.

� GS WSJ looks at Goldman Sachs's settlement with SEC

� GS Goldman Sachs upgraded to buy from neutral at Bank of America Merrill Lynch; target increased to $182 from $160

� Goldman Sachs reports 2Q10 earnings next Tuesday, July 20.

� Goldman SEC Settlement Vote Split Along Party Lines

� Goldman's Fine: 10.2 Market Days of Earnings from DealBook

� The news that Goldman Sachs had struck a settlement deal with the Securities and Exchange Commission was viewed by many on Wall Street as a something of a victory for the firm's chief, Lloyd C. Blankfein. NYT

o Citigroup and AIG classified certain repos as sales from Reuters

� BANGALORE (Reuters) - Citigroup Inc and AIG classified more than $11 billion in loans as sales in the second half of 2009, masking the companies' risk levels, filings with the U.S. Securities regulator showed.

o Citi Explains How It Hid Risk � WSJ link�Wall Street "window dressing

� In its letter dated April 13 to the U.S. Securities and Exchange Commission, which was made public on Thursday, Citi said the third quarter of 2009 had the largest amount of repurchase agreements accounted for as sales.

o Citigroup Eyes More Asian Expansion� - WSJ

� Citigroup� plans to open 70 retail branches in Asia over the next year and announce a Chinese brokerage venture by December, a top executive said, highlighting how emerging markets are increasingly central to the U.S. bank's global business.

� http://online.wsj.com/article/SB10001424052748703722804575368781341607338.html?mod=ITP_moneyandinvesting_2

o J.P. Morgan's Growth Story Unfinished � WSJ

� Missing was a sense the bank was seeing a return to growth in lending. Plus, it failed to quantify for investors the impact of financial-overhaul legislation passed by the Senate on Thursday.

� That is why investors didn't see the results as the kind of turning point for banks that many have long awaited.

� http://online.wsj.com/article/SB10001424052748704682604575369320315857094.html?mod=ITP_moneyandinvesting_11

o BofA on Front Lines of Financial Overhaul � WSJ link

� With the passage of the financial overhaul, Bank of America is refocusing its relationship with�and hoping to make money from�its tens of millions of consumer-banking customers.

o People's United Buys Two Banks in the Northeast from American Banker

� The Bridgeport, Conn., company announced late Thursday that it reached agreements to buy Smithtown Bancorp in Hauppauge, N.Y. and LSB Corp. in North Andover, Mass.

o AIG Taiwan unit buyers make more concessions-paper from Reuters

� TAIPEI, July 16 (Reuters) - The buyers of AIG's Taiwan life insurance unit have offered more concessions to Taiwanese regulators in their push to break a deadlock that has stalled the $2.2 billion deal for over eight

o BBT Barron's Weekday Trader is positive on BB&T Corp

o PCBC Pacific Capital Bancorp appoints Mark Olson CFO

o PBCT, LSBX People's United Financial to acquire a RiverBank, a subsidiary of LSB Corp

o PBCT People's United Financial reports Q2 EPS

o SMTB, PBCT Smithtown Bancorp to be acquired by People's United for $4.00/sh��

o GNV GSC Investment reports Q1 EPS

o ANGO AngioDynamics reports Q4 EPS

o TCAP Triangle Capital invests $5.5M in Hatch Chile Co

o RBS Three bidders in final round for Royal Bank of Scotland's Global Merchant services division � FT

o No Catastrophes From Europe Stress Tests Expected: Juncker from DealBook

� There should be no "big catastrophes" from stress tests on European banks but the reviews should be tough, the chairman of euro zone finance ministers, Jean-Claude Juncker, was quoted as saying, Reuters said

o IMF chief sees European banks safe in stress tests

o Stress Tests Won�t Force Share Sales at Big Banks, Goldman Says - BBG

� Stress tests of European banks aren�t likely to force major publicly listed lenders to bolster their capital by selling new shares, analysts at Goldman Sachs Group Inc. said.

REAL ESTATE

o JPMorgan Chase Driving a Harder Bargain in Mortgage Short Sales from American Banker

o JPMorgan Chase is taking a hard line with some borrowers who want to sell their homes for less than they owe on the mortgage and avoid foreclosure.

o California median home sale price slides in June from L.A. Times

o The 2.9% drop from May to $270,000 reflects a shift to sales in less expensive markets and is still a 9.8% increase from a year earlier, housing data firm says.

o California's median home sale price fell 2.9% in June compared with May even as sales picked up with buyers closing on purchases made during a spring season fueled by state and federal tax credits

o DRE Duke Realty upgraded to neutral from underperform at RW Baird ($10.85) Target remains $11.

o CUZ Cousins Properties upgraded to outperform from neutral at RW Baird ($6.38)� Target increased to $9 from $8.

o CRE Care Investment Trust announces commencement of self-tender offer

o VNO Vornado Realty Trust initiated buy at UBS; target is $89.

o CUZ Cousins Properties increases quarterly dividend to $0.09 from $0.02954

o Treasury plans to propose in 2011 an overhaul of housing finance

o Neal Wolin, deputy secretary of the U.S. Treasury Department, told participants at a conference that the government will propose an overhaul of housing finance early next year. The Treasury decided against trying to push the measure, including a reform of Fannie Mae and Freddie Mac, into legislation to overhaul financial regulation to avoid bogging it down. "We will undertake this work in parallel with the work of implementing the financial-reform bill," Wolin said. "It is obvious that the housing-finance system cannot continue to operate as it has in the past." Reuters (15 Jul.)

CONSUMER

o E-gaming:� NPD reports June software sales of $531.3M, (15%) y/y vs Street (11.7%) - VentureBeat

o MBA CIBT Education files for $15M offering through Maxim and Barrington

o TXIC Tongxin International says it is unable to publish its f09 consolidated financials by the extended deadline of 15-Jul

o OME Omega Protein announces fish catch statistics

o DUCK Duckwall-ALCO Stores CFO Donny Johnson resigns, effective 13-Aug

o PG, AVP, CL, CLX Morgan Stanley initiates Avon Products initiated overweight with $34 target; Colgate-Palmolive initiated equal-weight; Clorox initiated equal-weight; Procter & Gamble initiated equal-weight

o CAW CCA Industries reports Q2 EPS

o SAI SAIC receives two contracts valued at more than $10M by the Kingdom of Jordan

o CASY Casey's General reports June sales results

o FIZZ National Beverage Corp reports Q4 EPS

o JOEZ +6.2% (earnings) JOEZ Joe's Jeans reports Q2 EPS

o Burberry to buy out Chinese franchises from Financial Times

� Luxury fashion group will take direct control of 50 stores for �70m from Kwok Hang Holdings, its Hong Kong-based master franchisee

o Wal-Mart plans to raise �100B in 5-yr and 10-yr samurai bonds

GAMING, LODGING, & LEISURE

o Station Casinos Can Send Bankruptcy Exit Plan to Vote - BBG

� Station Casinos Inc., the biggest U.S. gambling company in bankruptcy, can send its reorganization plan to creditors for a vote, a judge ruled

� U.S. Bankruptcy Judge Gregg Zive in Reno, Nevada, said today that the disclosure statement for the company�s plan contains enough information for creditors to decide whether to support it

HEALTHCARE

o VVUS Vivus will hold conference call related to FDA Qnexa votes

o CBST Cubist Pharmaceuticals guides full year revenue - conf. call

o ELN Elan Corporation reaches agreement in principle for settlement of investigation of past Zonegran sales and marketing activities

o AVII AVI BioPharma awarded new contract with US DoD

o OHI Omega Health increases quarterly dividend by 12.5% to $0.36 from $0.32

o ATHN Athenahealth initiated market perform at Wells Fargo

o IMA Inverness Medical changes name to Alere

o DYII Dynacq Healthcare reports Q3 EPS

o ADLR Adolor will restructure; reduction in force of 30 employees

o CBST Cubist Pharmaceuticals reports Q2 EPS

o GSK WSJ expresses muted joy over GlaxoSmithKline's pending settlement of Avandia's future

o ABT� Cramer highlights Abbott Labs (ABT), noting that the stock is down just over 11% this year on concerns about declining healthcare budgets in Europe, where the company gets nearly a quarter of its revenues. According to Cramer, such concerns are already baked into the company's guidance. He is also positive on the company's product pipeline and its acquisitions in emerging markets. He goes on to cite the stock's attractive valuation and 3.7% dividend yield.

o ELN: Shares of Elan slipped in Dublin trade as the Irish drugmaker said after Thursday's close that it's set aside $206.3 million to cover an expected but not finalized settlement with the United States Attorney's Office for the District of Massachusetts with respect to the previously disclosed U.S. Department of Justice's investigation of sales and marketing practices for Zonegran, an antiepileptic prescription medicine that Elan divested in 2004

o Merck KGAA (MRK GR) CEO Karl-Ludwig Kley told the FT Deutschland that Merck will put on hold undertaking further buys for the next 6-18 months in order to pay off debt and secure its investment grade credit rating following its EUR 5.2bn acquisition of Millipore.

OTHER

� Stocks mentioned on CNBC's Mad Money with Jim Cramer - TheStreet.com�

+ ABT, SD, NFLX, BAC, BIDU, INTC, ALB, COP, DIS, GIS and CBOE

- EDU and AEZ

EUROPE TRADING WRAP

ASIA TRADING WRAP

o Japan

�

o Hong Kong

�

o China

�

INVESTMENT BANKING

M&A

o BP speeds up $20bn asset sale to boost funds- FT

� BP has accelerated the sale of up to $20bn worth of assets as it attempts to ease concerns about its financial health after the Gulf of Mexico oil spill

� A senior BP figure said the company could �easily� raise $20bn (�15.5bn) from disposals, twice its original target

� http://www.ft.com/cms/s/0/0c1751fa-9051-11df-ad26-00144feab49a.html

o BP Asset Buyers May Face Suits as It Raises Money to Pay Claims- BBG

� Laws prohibiting fraudulent transfers could allow victims to sue a buyer to recover money deemed essential to pay claims, and successor liability could leave a purchaser with BP�s obligations, if BP files for bankruptcy

� A proposed change to federal bankruptcy laws could force a buyer to wait for BP to get approval from victims for the sale, or persuade a judge it will have enough assets to pay claims in full.

o OMNI �announces expiration of "Go Shop" provision of merger agreement with Wellspring

o V.C. Investments Climb 53% in 2Q- Dealbook

� Venture capitalists funneled more money into U.S. startups in the second quarter, indicating continuing confidence that the economy is on the mend

� A study scheduled for release Friday shows that startup investments in the April-June period climbed 53 percent from the same three months in 2009 to $6.5 billion. This is the most money invested in startups since the third quarter of 2008

� http://dealbook.blogs.nytimes.com/2010/07/16/v-c-investments-climb-53-in-2q/

o FFN Penthouse owner offers $210 mln for PLA Playboy- Reuters

� The owner of Penthouse magazine on Thursday offered to buy rival Playboy Enterprises for $210 million, making a bid that was 13 percent above the buyout proposal from Playboy's iconic founder Hugh Hefner earlier this week.

� To sweeten the deal, Penthouse publisher FriendFinder Networks said Hefner is welcome to retain editorial control of Playboy magazine and to continue to reside in the Playboy Mansion

� http://www.reuters.com/article/idUSN1519411620100715

o Two final bids seen for Australia's Healthscope- Reuters

� Two rival private equity groups are expected to lodge final bids on Friday in a $1.6 billion battle for control of Healthscope

� Bids are expected from buyout firm Kohlberg Kravis Roberts & Co (KKR.N), which lodged an indicative bid at A$5.80 a share, and from a consortium comprising TPG [TPG.UL] and Carlyle [CYL.UL], which lifted an initial bid to A$5.75 a share in May

� http://www.reuters.com/article/idUSSGE66E0MD20100716

o AIG Taiwan unit buyers make more concessions- Reuters

� The buyers of AIG's (AIG.N) Taiwan life insurance unit have offered more concessions to Taiwanese regulators in their push to break a deadlock that has stalled the $2.2 billion deal for over eight months

� http://www.reuters.com/article/idUSTOE66F00T20100716

o Three bidders line up for RBS merchant unit- FT

� Royal Bank of Scotland has three bidders competing in the final round of the auction of its Global Merchant services division, which is centred on the WorldPay payment processing business

� http://www.ft.com/cms/s/0/cc0fbdc6-9047-11df-ad26-00144feab49a.html?ftcamp=rss

o ERTS Electronic Arts exiting France's Ubisoft- Reuters

� U.S. video games producer Electronic Arts Inc (EA) (ERTS.O) is selling out of Ubisoft Entertainment SA (UBIP.PA) six years after buying a big chunk of the world's third-largest independent video games publisher

� A Ubisoft spokesman said EA was selling an unspecified stake in the French company. He would not confirm reports EA was selling its entire 14.8 percent stake

� http://www.reuters.com/article/idUSLDE66F0K120100716

o NAB In Talks On Extending Period To Satisfy Regulator's Concerns On AXA APH Bid- WSJ

� National Australia Bank Ltd. (NAB.AU) said Friday it is in talks with its target AXA Asia Pacific Holdings Ltd. (AXA.AU) and its major shareholder AXA SA (AXAHY) to extend the period for NAB to appease concerns raised by Australia's competition regulator

� http://online.wsj.com/article/BT-CO-20100715-715741.html

o GE selling BAC-Credomatic bank group for $1.9 bln- Reuters

� It is the biggest foreign acquisition ever by a Colombian company. Grupo Aval, controlled by Colombian banking magnate Luis Carlos Sarmiento, disclosed the purchase price to local market regulators

� http://www.reuters.com/article/idUSN1520200620100715

o Candover Says Talks With Potential Buyer Have Ended- BBG

o NWSA MySpace acquiring team and assets of social messaging service Threadbox- Venturebeat.com

� A source close to the matter tipped VentureBeat off on the news, and MySpace has since confirmed the deal with venturebeat

� �We�re thrilled to announce that the talented Threadbox team has joined MySpace. We�re in active discussions about how we can incorporate their innovative technology into our site.�

� http://deals.venturebeat.com/2010/07/15/myspace-acquiring-team-and-assets-of-social-messaging-service-threadbox-exclusive/

o HON Honeywell Receives U.S. Antitrust Clearance for Acquisition of Sperian Protection- PR Hub

� The transaction has already been approved by the French Ministry of Economy, Industry and Employment pursuant to French regulations relating to foreign investments

� The completion of the offer only remains subject to the European Union antitrust clearance and to the successful tender by Sperian's shareholders of shares representing no less than 57% of the fully diluted number of shares

o Paper Excellence buys struggling Howe Sound mill- Reuters

� Paper Excellence BV agreed to buy Howe Sound Pulp and Paper on Thursday in the latest expansion in Western Canada by the Netherlands-based unit of Indonesia's Sinar Mas

� http://www.reuters.com/article/idUSN1523678520100715

o TC Thompson Creek to buy TRX Terrane Metals for C$650 mln- Reuters

� Molybdenum miner Thompson Creek Metals said on Thursday it intends to acquire exploration company Terrane Metals in a deal worth about C$650 million ($625 million) as it moves to diversify its commodity exposure

� http://www.reuters.com/article/idUSN1520049720100715

o CPPIB sees top toll-road prize in Australia bid- Reuters

� CPPIB's multibillion-dollar bid for Australia's Intoll this week took it half way around the world and back to Toronto to take a run at one of the world's top toll road prizes: the Highway 407 expressway north of Canada's richest, biggest city

� The Canada Pension Plan Investment Board, or CPPIB, the country's second-biggest pension manager, offered to pay C$3.5 billion ($3.4 billion) for Sydney-based Intoll Group (ITO.AX), driving up its shares by 30 percent.

� http://www.reuters.com/article/idUSN1521783220100715

o PBCT People's United acquires 2 banks for $156 mln- Reuters

� People's United Financial will buy two lenders for $156 million as the U.S. bank moves aggressively to put to work its excess cash and looks to expand its banking services

� People's United said it will buy Massachusetts-based LSBX LSB Corp for abour $96m and SMTB Smithtown Bancorp for about $60m

� http://www.reuters.com/article/idUSSGE66E0LI20100715

o LIC demands higher offer price for ABB- Economic Times

� Life Insurance Corporation (LIC) is nudging Swiss engineering firm ABB to raise the open offer price made to public shareholders of its� Indian arm

� LIC, which has mostly been a passive investor so far, has asked ABB to raise the open offer price to Rs 950-1,000 per share

� http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/LIC-demands-higher-offer-price-for-ABB/articleshow/6174271.cms

o Essar may get Rs 3,493 crore windfall from VOD Vodafone- Business Standard

� The Ruias of the Essar Group will now be getting around $750 million (about Rs 3,493 crore) more from their telecom joint venture partner, Vodafone Group, over and above the fair market price if they exercise the �put� option for their 33.02 per cent stake.

� http://www.business-standard.com/india/news/essar-may-get-rs-3493-crore-windfallvodafone/401571/

o SE Spectra to buy Bobcat storage facility for $540 mln- Reuters

� Spectra also said it will invest an additional $400 million to $450 million to fully develop the facility by the end of 2015, adding that the facility will have a total gas storage capacity of 46 billion cubic feet

� http://www.reuters.com/article/idUSSGE66E0LU20100715

o Hollywood producer, VC exec win Warriors NBA team- Reuters

� A group led by one of Silicon Valley's top venture capitalists and a Hollywood movie producer said it would buy the Golden State Warriors basketball team for a record $450m

� Joe Lacob and Mandalay Entertainment Group Chairman and Chief Executive Peter Guber, the former chairman of Sony Pictures Entertainment, said their group would buy the long-suffering team from Chris Cohan, beating out other bidders including Oracle Corp (ORCL.O) Chairman Larry Ellison

� http://www.reuters.com/article/idUSN1522557720100715

o Terra Energy to buy assets from Fortress Energy- Reuters

� Terra Energy Corp (TT.TO) said it will buy substantially all of Fortress Energy's (FEI.TO) oil and gas properties, including the Square Creek assets in Western Canada, taking its total current production to nearly 8,000 barrels of oil equivalent per day

� Terra said it will pay C$34.6m ($33.30m) for the Square Creek assets, of which C$25.6 million will be paid in cash and C$9.0m in 5m Terra common shares at C$1.80 each.

� http://www.reuters.com/article/idUSSGE66E0LR20100715

o Crest Nicholson adviser spurns Hugh Osmond bid-FT

� Advisers to Crest Nicholson have told its lenders to reject a 350m pound ($537.3m) takeover approach from Horizon Investments because it undervalues the company

� Morgan Stanley believes Crest Nicholson is worth between 300 million and 500 million pounds

� http://www.reuters.com/article/idUSLDE66E26A20100715

$ RAISING

o With AIA IPO back on, underwriter guessing game begins- Reuters

� One key question is: will AIG keep the same investment banks they had chosen the first time around? Or will they scrap that roster, and start anew?

� Bankers said the IPO, which could be completed by year-end, is targeting raising around $15 billion. That would be the biggest ever IPO done solely in Hong Kong.

� http://www.reuters.com/article/idUSTOE66F01820100716

o NetSpend Holdings Files $200M IPO- StreetInsider.com

� NetSpend Holdings, Inc. filed a registration statement with the U.S. Securities and Exchange Commission today for an Initial Public Offering of its Common Stock. The proposed maximum aggregate offering price is $200 million

� http://www.streetinsider.com/IPOs/NetSpend+Holdings+Files+%24200M+IPO/5810099.html

o SMT Smart Technologies shares rise in Nasdaq debut- Reuters

� Shares of digital whiteboard maker Smart Technologies� rose in their debut on Thursday after the offering was increased and backers including private equity firm Apax Partners and chipmaker Intel Corp (INTC.O) sold more shares in the company.

� Shares of Smart, whose interactive whiteboards allow users to write, project, save and share notes, images and websites, closed at $17.05 on Thursday, 0.3 percent above their $17 initial public offering price

� http://www.reuters.com/article/idUSTRE66E3G620100715

o AgBank closes mega IPO with tepid HK debut- Reuters

� Agricultural Bank of China's $19.3 billion IPO limped across the finish line on Friday after a hectic three-month sprint, its modest Hong Kong debut gains reflecting valuations concerns and tough markets

� While the first day performance matched expectations, earlier listings of China's other large banks fared much better.

� http://www.reuters.com/article/idUSTRE66D15V20100716

o Harrah�s Puts Paulson in �Driver�s Seat� for Public Offering- BBG

� Harrah�s Entertainment Inc., the world�s biggest casino owner, expects to list some shares publicly in coming months because of the deal owners Apollo Management LP and TPG struck with billionaire John Paulson

� �This puts Paulson in the driver�s seat� because his hedge fund, New York-based Paulson & Co., can push Harrah�s to register his shares faster than other investors may have preferred

o Molycorp IPO: Tough Sell on Wall Street- TheStreet.com

� For those investors looking for a long-term investment Molycorp (MCP) is the deal for you; however, the esoteric characteristics that encompass this offering, will be a major obstacle for Morgan Stanley to overcome, as the highly technical aspects of this deal can be somewhat difficult to understand

� http://www.thestreet.com/story/10808363/1/molycorp-ipo-tough-sell-on-wall-street.html

o AgBank Said to Ask H.K. I.P.O. Advisers for 36% Cut- Dealbook

� Agricultural Bank of China is negotiating a 36 percent cut in underwriter fees for its $10.5 billion initial stock sale in Hong Kong to reflect talks with corporate investors that the lender handled itself

� The seven arrangers, led by Goldman Sachs, Morgan Stanley and China International Capital, may share about $70 million of the roughly $205 million of gross fees upfront

� http://dealbook.blogs.nytimes.com/2010/07/16/agbank-said-to-ask-h-k-i-p-o-advisers-for-36-cut/

o A Subdued Public Offering for K.K.R.- Dealbook

� The long-awaited public stock listing of Kohlberg Kravis Roberts & Company� went off with a yawn on Thursday

� Shares of the firm�s parent company fell 3 percent on the New York Stock Exchange, closing at $10.20.

� http://dealbook.blogs.nytimes.com/2010/07/16/a-subdued-public-offering-for-k-k-r/

o GM's IPO May Require Hefty Incentives- BBG

� The Wall Street underwriters, likely to be Morgan Stanley (MS) and JPMorgan Chase (JPM), are so keen to participate that they are accepting a 75% discount on their fees

� It's not clear that investors are pining to buy GM 2.0. Instead, it will be that GM's limited record of success�the company just reported its first quarterly profit since 2007�is only the beginning

� http://www.businessweek.com/magazine/content/10_30/b4188031266277.htm?campaign_id=rss_topStories

PRICINGS

o Initial Offerings

o QLIK Qlik Technologies 11.2M-share IPO priced slightly above the range at $10/share

o RLD RealD 12.5M-share offering priced at $16/share through JPMorgan and Piper Jaffray

o Secondary Offerings

o No offerings still on the schedule for this week

NEWS

o Colombia Grupo Aval plans share issue for purchase- Reuters

� Colombia's Grupo Aval GAA.CN said on Thursday that it would fund the purchase of BAC-Credomatic with $1 billion in preferential shares for current shareholders and fund the rest through bonds or loans

o BSX Boston Scientific execs selling shares � WSJ

� Boston Scientific Corp's (BSX.N) Chairman Pete Nicholas and board member John Abele are selling millions of shares from the medical device company they founded decades ago, prompted in part by banks

� http://www.reuters.com/article/idUSN1525463820100716

o APA Apache seeking financing to buy BP assets- Reuters

� Oil and gas producer Apache Corp is seeking $6b to $7b financing to purchase up to $10 billion in assets from BP in a deal that could be announced next week

� http://www.reuters.com/article/idUSTRE66E4IS20100715

o Station Casinos Can Send Bankruptcy Exit Plan to Vote- BBG

� U.S. Bankruptcy Judge Gregg Zive in Reno, Nevada, said today that the disclosure statement for the company�s plan contains enough information for creditors to decide whether to support it

� The company is negotiating with lower-ranking creditors to win their support before voting begins in the next few days

o Education: MBA CIBT Education files for $15M offering through Maxim and Barrington

o Energy: TGP Teekay LNG Partners to sell ~1.7M units to an institutional investor for ~$51M

o Healthcare: AEZS Aeterna Zentaris files $85M equity shelf

TODAY�S EVENTS

Conferences

Friday July 16:

o IncreMental Advantage Management Psychology Seminar - Jul 16, 2010

o amat Nagoya Stock Exchange IR Expo 2010 - Jul 15, 2010 - Jul 16, 2010

� 2:20AM: 363000.T

� 9:30PM: 860100.T

� 9:45PM: MZHIF.PK

COMPANY MEETINGS/OTHER DAILY EVENTS

� Friday July 16:

o Shareholder Meetings

� NEOP, SD, SKPN, TMRK, EXAS, GPR, NTSC, NOVB

o DELL annual General Meeting

o Treasury data on May net foreign purchases of U.S. securities is released.

o C, BAC, and GE all report

o The WTO rules on an EU complaint over alleged U.S. subsidies for Boeing.

o Hong Kong debut of Agricultural Bank of China, a day after shares start trading in Shanghai.

ECONOMICS

� Friday July 16:

o 0830 Consumer Price Index

o 0900 Net Long Term TIC flows

o 0955 University of Michigan Confidence Index

EARNINGS

� Industrials/Homebuilders

o Friday July 16: GE, USAK, COL,

� Consumer/Retail/Education

o Friday July 16: FIZZ, ACU, DIT, MAT, KNL, GPC

� Financials

o Friday July 16: C, MFSF, PBNY, STU, SCHW, BAC, PMIC, AROW, BPOP , CNAF, CPBC, FHN, FSBK, LION, PWOD, WCBO, MXFD, BRKL, CAFI, MTG, UBNK, MNRK, RBCAA, WBS

� Tech/Telecom

o Friday July 16: NENE, Sony Ericsson

� Healthcare

o Friday July 16: RPTP, VIVO

� Real Estate

o Friday July 16: CTO

� Media

o Friday July 16: GCI

� Energy

o ARD and SD have special shareholders meeting July 16^th�..

� The board of Arena continues to recommend that Arena stockholders vote in favor of the merger with SandRidge at the Arena special stockholders meeting scheduled for July 16, 2010

***All eco data from Bloomberg and DJ

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