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Morning @ Cantor
Morning
@ Cantor 8/16
Today’s
Stories From Cantor Fitzgerald
Sal
Catrini (908) 517-5067
PLEASE
NOTE: Sal Catrini is out today.
Any
questions or Comments please call Brian Young 212-610-3629
CONTENTS: All
Headings Are Functioning Links
Sector
News:
Energy, Industrials, Transports, TMT, Materials, Autos, Fins, Real Estate, Consumer, Gaming/Lodging, HC, Europe Trading Wrap,
Asia Trading Wrap
Investment
Banking Wrap:
M&A, Money Raising
o US Stock Futures
o
S&P Futures down 1.4 to 1074.7
o
USD down 0.31 in the session
o
‘Mr. Yen’ Says Japan
Can’t Stem Currency’s Rise as U.S. Falters- BBG
§
“What
we are seeing is not appreciation of the yen but weakness of the dollar,
reflecting concerns that the U.S. economy may falter,” Eisuke Sakakibara,
formerly Japan’s top currency official, said yesterday on the Fuji television
network.
§
“There
is a chance the yen will reach an all-time high and stay at that level for the time
being.”
o
Treasury Yields: U.S. 10-Year Yield Reaches 16-Month Low; Global Buying
May Rise- BBG
o
Treasury
10-year yields fell to their lowest level in more than 16 months before a
government report that economists said will show global purchases of U.S. financial
assets increased in June.
o Two-year rates were
three basis points away from a recordlow as the Federal Reserve prepared to buy
Treasuries this week as part of its plan to spur the slowing economy by keeping
borrowing costs low.
o Commodities
o
Gold up 7.9 to 1224, Copper up 0.37%, Crude up 0.28 to 75.67
o
Russian grain ban angers traders- FT
§
Expected
to run at least until the end of the year, the ban has cast a shadow over
Russia’s many new grain terminals and raised questions about the country’s
reliability as a global grain power.
o Overseas Action
o
Europe markets: FTSE 100: (0.57%); DAX: (0.36%); CAC 40: (0.83%)
§
European
markets reversed initial modest gains as the concerns over the outlook for
economic growth out weighted constructive updates from Hochtief (HOT.GR) and
H&M (HMB.SS) and continuing M&A news- SA
o
Asian Markets: Nikkei
(0.61%); Hang Seng +0.19%; Shanghai Composite +2.11%
§
Asian
equity markets echoed mild selling pressure in US indices late on Friday as
well as disappointing Q2 growth data from Japan, where economic recovery
appears to be grinding to a stop.- TTN
o
Data:
§
JAPAN Q2 PRELIM GDP Q/Q:
0.1% V 0.6%E; ANNUALIZED: 0.4% V 2.3%E (both q/q and y/y match 5-quarter low
seen in Q3 2009);
§
JAPAN NOMINAL GDP Q/Q:
-0.9% V -0.3%E; GDP DEFLATOR Y/Y: -1.8% V -1.8%E
§
Euro-Zone July CPI M/M: -0.3%
v -0.4%e; Y/Y: 1.7% v 1.7%e ; CPI Core Y/Y: 1.0% v 1.0%e
§
India July Wholesale Prices Y/Y: 10.0% v
10.4%e
o
China's
Economy Is Set to Top Japan's- WSJ
o
China says milk powder is safe- WSJ
o
China must keep yuan stable to help trade - Economic Times
§
China
must keep the yuan basically stable as part of a policy kit to support the
country's international trade
o
India: to Top China as Fastest Growing Economy, Chetan Ahya
Says- BBG
§
India
may become the world’s fastest growing major economy by 2015 outpacing China,
as the nation doubles infrastructure investment and adds six-fold more workers
than its northern neighbor
o
Japan: Growth Slows Down Sharply Amid Yen Worries- CNBC
§
Japan's
economic growth slowed markedly in April-June and analysts predict further
slowdown, adding to policymakers' difficulties as they grapple with deflation
and a rise in the yen that threatens an export-reliant recovery.
o
UK: Bankers
threaten to move abroad over bonus restrictions- Telegraph
§
Anger
about the Financial Services Authority's (FSA) strict implementation of the G20
code on pay follows the Treasury's decision to impose a bank tax unilaterally,
and has raised questions about whether the UK is the right place to be
headquartered.
o
UK: 2010 to witness lowest equity trading volumes for
eight years- Independent
o
South Korea Calls for Unity Tax as North Slams Drills- BBG
§
South
Korean President Lee Myung Bak called for a special tax to cover the costs of
eventual Korean unification as North Korea threatened to respond to a
U.S.-South Korea military drill with “the severest punishment.”
o
Ireland’s Honohan
Sees Slow European Recovery- Reuters
§
“The
story is a rather slow recovery despite the rather encouraging news from
Germany,” he said. He said he saw few signs of “excesses” emerging in asset
prices
o
European exchanges face existential crisis-
Financial News
§
The
London Stock Exchange, Deutsche Börse and NYSE Euronext face unprecedented
levels of competition in the areas that used to generate the bulk of their
revenues, begging the question: “What is the point of a stock exchange?”
- Economics
today:
o
Aug Empire Manufacturing at 08.30 ET
o
Jun TIC Flows at 09.00 ET
o
Aug NAHB Housing Market Index at
10.00 ET
- Earnings:
o
Companies
due to report before the bell include: LOW, SYY
o
Companies
due to report after the close include: A, URBN
o Top M&A
o
Chile's LAN, Brazil's TAM To Create Airline Giant- DJ
o
GENZ Genzyme has little leverage to play hardball-
Reuters
o
BAC Bank of America weighs reducing BLK Blackrock stake-
WSJ
§ The paper said that the bank has concluded
that its 34 percent share of BlackRock Inc isn't a core asset
o
Aviva holding out for an offer of at least £8B for its
general insurance division-- London Times
o Vedanta to buy stake in Cairn India for $8.5-9.6bln- Reuters
§ India-focused miner Vedanta Resources (VED.L)
said it will buy 51-60 percent of Cairn India for about $8.5-9.6 billion in
cash to be funded with debt and cash
o Top $ Raising
o
As Summer Fades, Dreams of IPOs to Come- WSJ
§ As the IPO market heads off for summer vacation this week, bankers and
investors are left to ponder what the new-issuance landscape will look like
when deals begin lining up again after Labor Day.
o
Hulu getting ready for IPO this fall – NYT
o
AgBank confirms greenshoe as IPO hits record $22.1
billion- Reuters
§ Agricultural Bank of China (AgBank) said on
Sunday it had fully exercised an over-allotment option for the Shanghai portion
of its initial public offering, taking total proceeds from the offer to $22.1
billion, making the IPO the world's biggest
o
BofA, Citi added as lead GM IPO underwriters- Reuters
o
The Double Dip could be coming soon- CNBC
o
Treasury markets: There have also been hints that some of the buying
pressure on 10-year Treasuries looks forced or mechanical, related to hedging
by mortgage-bond investors- Barron’s
o
http://online.barrons.com/article/SB50001424052970203880104575419343943747982.html
o
Credit Markets: Google Leading a Revival in Commercial Paper- BBG
o
Google
Inc., owner of the most popular Internet search engine, and Germany’s Merck
KGaA are leading a revival in commercial paper as nonfinancial companies grab
the biggest share of the $1.1 trillion U.S. market from banks since 2002 amid
lower borrowing costs
o
'Junk' Bonds
Hit Record- WSJ
o
U.S.
companies issued risky "junk" bonds at a record clip this week,
taking advantage of keen investor appetite for returns amid declining interest
rates and tepid stock markets.
o
C Citigroup to Start
Dark Pool Trading in Singapore- BBG
o
Citigroup,
the third-biggest U.S. bank, says it will start so-called dark pool electronic trading
in Singapore early next year to meet growing demand in Asia.
o
The
bank is expanding its regional footprint after its off-exchange trading in
Australia increased to a record A$1.5 billion ($1.3 billion) in June from about
A$700 million to A$800 million a year earlier
o
Stimulus
spending slow to take shape-
WPO
o
While
the majority of the stimulus package's tax cuts and aid to states and the
unemployed has been spent, the third of the package devoted to investments in
public infrastructure, health care and other areas is being spent more slowly
o
Venture
Capital competition rising due to ‘super angels’- WSJ
o
Much
of the venture-capital industry is undergoing a shakeout. But a growing breed
of start-up investors dubbed "super angels" is rapidly raising new
money—and ratcheting up competition with established venture capitalists in the
process.
o
The future
of 3D- FT
o
It
was hailed as the great saviour of the film industry, but since 3D technology
propelled Avatar to a record-breaking $2.73bn box-office haul, fears are
growing that Hollywood is endangering its profitable new format
o
GE capital
to be under stricter oversight- WSJ
o
The Power of
Payouts - A Barron's screen turns up 13 big companies with
inexpensive stocks, healthy dividends and the ability to keep paying
shareholders- WSJ
o
States Are
Lacking in Health Law Authority- NYT
o
Faced
with the need to review insurance rates and enforce a panoply of new rights
granted to consumers, states are scrambling to make sure they have the
necessary legal authority to carry out the responsibilities being placed on
them by President Obama’s health care law
o
FHA Gets
Tougher on Mortgages- WSJ
o
Unlike Last Effort, New Basel Process Zips Along-
American Banker
o
While
the Basel II process dragged on for years, international and domestic
regulators appear intent on delivering a new set of capital and liquidity
standards on time
o
Tech: AAPL Apple's Ad Service Off to Bumpy Start- WSJ
o
Tech: AAPL Apple manager indicted on kickback charges
o
U.S. Seeks
Boost in Asia Presence-
WSJ
o
The
U.S. is seeking to strengthen its presence in Asia in an effort to boost U.S.
exports and provide a counterbalance to China's increasing dominance in the
region.
o
Pakistan Aid: U.N. Chief Urges Donors To Speed Aid to Pakistan-
WSJ
o
Freights taking a hit- WSJ
o
Kass calls financials attractive- CNBC
o
CNBC discusses whether tax cuts would jumpstart
economy
o
Lease Accounting: Rulemakers
plan global overhaul- Reuters
o
U.S.
and international accounting rule makers are planning to propose an overhaul of
lease accounting as soon as Tuesday, in a move expected to affect some $1.2Tr in
leased assets
o
Cities
Seek Control of Schools- WSJ
o
As
cities come under increasing pressure to fix failing schools, more are trying
to take matters into their own hands—or at least those of their mayors
o
HPQ Board Said to
Turn Against Hurd After Surprise Settlement- BBG
o
The
board’s trust in Hurd also was undermined after a probe found he tried to
conceal a relationship with his accuser, a former actress named Jodie Fisher
who worked for HP as an event organizer
o
Afghanistan’s
Withdrawal Deadline May Change, Petraeus Says- BBG
o General David
Petraeus said the July 2011 deadline for the withdrawal of troops from
Afghanistan is “conditions based” and could change depending on his assessment
of progress
o
Beware $1 Trillion
Lying Under Chinese Mattress: William Pesek- BBG
o
Last
week, we learned China’s households hide as much as 9.3 trillion yuan ($1.4
trillion) of income not reported in official figures -- 80 percent of it by the
nation’s wealthiest. This massive pile of stashed cash is equal to about 30
percent of gross domestic product
o
The
good: it lends credence to the domestic-demand story for Chinese growth. It
turns out, the average urban disposable household income is 32,154 yuan, or 90
percent more than official figures. The bad: China’s rich-poor gap may be much
bigger than we realize.
o
IT Firms Howling As V Visa Fees Leap- WSJ
o
The
measure, signed into law by President Barack Obama on Friday, is expected to
raise operating costs for outsourcing firms that use large numbers of
foreign-born employees to serve their U.S. customers.
o Macro negative:
o
Time to Fear the Hindenburg Omen?- CNBC (Friday Article)
§
There
is disagreement about whether the NYSE is giving the right signal. Some
analysts claim it is citing their data, and others not
o
China
favoring Euro over Greenback-
BBG
o
Baby Boomers
threatening the economy-
WSJ
§
America's
baby boomers—those born between 1946 and 1964—face a problem that could weigh
on the economy for years to come: The longer it takes for the economy to
recover, the less money they'll have to spend in retirement
o
US 'Virtually Certain' to Fall Into A New Recession: Rosenberg- CNBC
§
The
US economy is almost certainly headed back into a double dip, and economists
aren't seeing it because they're using "the old rules of thumb" that
don't apply this time
o
Growth angst drifts back to U.S. shores-
Reuters
§
After
worrying about Europe for several months, economists are now turning their
focus back to the United States, where high unemployment and a historic housing
slump just won't go away
o
Budd Says Double-Dip
Recession Is a Possibility in U.K.- BBG
§
Alan
Budd, who stepped down as chairman of the U.K. Office for Budget Responsibility
last week, said growth remains his most likely forecast for the economy, with a
double-dip recession still possible
o Macro Positive:
o
The
average credit score rose to 704 in July- CNBC
o
Detroit
Goes From Gloom to Economic Bright Spot- CNBC
§ After a dismal period of huge losses and deep cuts that culminated in the
Obama administration’s bailout of General Motors and Chrysler, the gloom over
the American auto industry is starting to lift.
o
Japanese-style deflation fears bode well for US-
FT
o Political Stories:
o
Obama
Strongly Backs Islam Center Near 9/11 Site- CNBC
§ President Obama delivered a strong defense of a proposed Muslim community
center and mosque near ground zero in Manhattan, using a White House dinner
celebrating Ramadan to proclaim that “as a citizen, and as president, I believe
that Muslims have the same right to practice their religion as anyone else in
this country.”
o
Obama's Mosque Remarks Reverberate-
WSJ
§ A number of Republicans on Sunday folded the president's remarks into their
election-year narrative that Mr. Obama, a former constitutional scholar, is out
of touch with the American citizenry
o
Heated Rhetoric Gets No Vacation in Congress-
WSJ
§ Congress's hot August recess has begun with rhetoric to match, with
Democrats pummeling Republicans for wanting to trim Social Security, and
Republicans hammering Democrats for favoring tax increases.
o
Crist leads 3-way Senate race in Florida-
Reuters
§ Florida Governor Charlie Crist has a slight edge over Republican Marco
Rubio and either possible Democratic candidate in a three-way U.S. Senate race
in November, according to a poll released on Sunday.
o
Democrats Urge Kennedy to Regain Senate Seat- WPO
§ Some Democrats are urging Victoria Reggie Kennedy, the widow of the late
U.S. Senator Edward Kennedy, to try to win back her late husband’s Senate seat
from the Republicans
o
Republicans See Gains
in Governors’ Races as Funding Hits Peak- BBG
§ Republicans, fueled by record fundraising, are poised to win most of the
state governorships in November, which would give them an advantage in
congressional redistricting and a new pool of talent for national office
o
Democrats uncertain about approach to midterms- WPO
§ The Democrats passed the stimulus package. They passed health-care and
Wall Street overhauls and revamped the financing system for higher education.
Their other main priorities, on immigration and energy, appear to be headed
nowhere.
§ http://www.washingtonpost.com/wp-dyn/content/article/2010/08/15/AR2010081503232.html
o
Senators Say Economy Will Be Top Issue in U.S. November
Vote- BBG
§ With a 9.5 percent unemployment rate and slow job growth, President
Barack Obama’s party is “the underdog,” Democratic National Committee Chairman
Tim Kaine said.
o Fed watch stories:
o
The Fed
Can't Solve Our Economic Woes- WSJ
o Crisis Watch
o Will China
leapfrog France as a nuclear superpower?- FT
o U.S.-South Korea drills anger North, worry China-
Reuters
§ The U.S. and South Korean
militaries will stage their second joint exercise in less than a month from
Monday, fuelling tensions with the prickly North and angering regional power
China.
o China Not Threatened by U.S. Carrier Exercises, Scholar Says-
BBG
§ China should not feel threatened
by exercises later this year in the Yellow Sea involving a U.S. aircraft
carrier, a scholar at China’s National Defense University said.
§ The U.S. regularly sent aircraft
carriers through the straits separating mainland China from Taiwan in the past
“but didn’t dare to do anything against China
o U.S. urges vigilance in sanctions on Iran shipping-
Reuters
§ Writing in the Financial Times,
Treasury Undersecretary Stuart Levey said Iranian tactics to evade sanctions
included repainting or renaming ships, falsifying shipping documents and
assigning vessel ownership to front companies outside Iran
o Hamas and secular groups, oppose direct talks with
Israel- Reuters
§ Two secular Palestinian
organizations joined Hamas on Sunday in calling on President Mahmoud Abbas not
to bow to U.S. pressure to resume direct peace talks with Israel, which they
described as dangerous
o US issues arms deal ultimatum to Turkey- FT
§ President Barack Obama has
personally warned Turkey’s prime minister that unless Ankara shifts its
position on Israel and Iran it stands little chance of obtaining the US weapons
it wants to buy.
o
Top Real Estate Stories:
o
Jump in Refis May Lead to Weaker Home Sales Later- American
Banker
§
A surge of refinancings at record
low interest rates today could mean a dearth of homebuyers applying for
mortgages tomorrow
§
http://www.americanbanker.com/issues/175_156/jump-in-refis-1024097-1.html
o
House prices face rollercoaster ride- FT
§
Global housing markets have broadly
staged a modest recovery over the past year. But the improvement in many
countries is already showing signs of running out of steam, and there are fears
that markets that bounced back from the house price crash of 2006-07 are again
approaching tipping point
§
http://www.ft.com/cms/s/0/cd3b5ec4-a886-11df-86dd-00144feabdc0.html
o
Treasury Fixing Home-Finance Juggles Limitless
Bailout, Economy- BBG
§
The U.S. Treasury Department,
hosting a summit tomorrow on how to repair the mortgage-finance system, may get
a blunt message from stakeholders in an industry tied to 15 percent of the
country’s economy: Don’t screw it up
o
London House-Price Drop Wipes Out 2010 Gains, Rightmove Says-
BBG
§
London home sellers cut 17,000
pounds ($26,500) off their asking prices on average in August, wiping out gains
recorded in the first half of the year
§
Reports from Nationwide Building
Society and Halifax also signal that the U.K.’s housing recovery is faltering,
while Rightmove said a squeeze in the availability of credit may limit price
gains
o Equity Recap
o
Overseas
markets gave us a steady playing field to start with being mixed to higher
coming in this morning giving investors an opportunity to buy on the dip and
press the shorts, but it seems most wanted to play it safe going into the
weekend. Economic data looked was mixed, confidence was higher but retail sales
were lower, we’re still hard pressed to find a reason to add on anything substantial
in this market. Volume was very light and buyers were scarce, had some quant’s
and vanilla’s adding on lightly, hedgies peppering the market with some shorts,
but the action all around was nothing to brag about. Lower across the board on
the major index’s down 3-5% - most of the action we saw internally was focused
on electronic and health technology spaces with the financials and energy
bringing up the rear. JWN fell more than 7% after saying expenses increased in
the second quarter, JCP and KSS were both lower as well down 3.2% on the
retailer number, LLY fell 2.5% after losing patent protection on a product, DYN
surged 63% after news they would be acquired by Blackstone, ADSK was up 2.5% as
well on better numbers. Internally buy and sell names were pretty much even,
the breadth of the market had almost 1 ¼ declining issues for every 1
advancing.
o
Many
are starting to hear about the "The
Hindenburg Omen” again. Hindenburg Omen is not a guarantee of a
crash, and the five criteria that must be met for a Hindenburg trigger
typically need to reoccur within 36 days for reconfirmation. Yet the statistics
are startling: "Looking back at historical data, the probability of a move
greater than 5% to the downside after a confirmed Hindenburg Omen was 77%, and usually
takes place within the next forty-days." The last Hindenburg Omen occurred
during the lows of 2009.
o
Billy
Clark and Team
o Converts recap
o
We’re
deep into the summer trading volumes now. 5 names were half of today’s volume.
Still seeing small profit taking in some of the credit names that have provided
most of the returns this year. While some of the credit names are for sale,
money is moving into volatility names. Customer buys slightly outnumbered
customer sells today. Qwest announce that they are extending their tender for
their converts as only 7% were tendered. They are offering a 3 point premium
over parity with a 117 top on the tender. With the stock at these levels,
investors are not finding that an appealing offer.
o
Tom
Fazio
o
Rates Commentary
o
Treasury market opened up the New
York session higher with the curve modestly changed. Today's data came in
all close to expected CPI MoM .3% versus expected .2%, ex food and energy .1%
as expected, retail sales .4% vs. expected .5% but last month was revised
better by .2% and later in the morning University of Michigan confidence 69.6
versus an expected 69.0. The Treasury market was extremely quiet
with a curve flattening theme materializing throughout mainly as the long end
sector rallied on short covering and real money buying. At 3PM the Treasuries
finished mainly higher in price with the long end the best performer, 2/10s
flattened by 5.7bps trading at 215.5 5/30s flattened by 6.6bps trading at
241bps and 10/30s flattened by 2.1bps trading at 118.3.
o
Next week the Fed will conduct two
coupon passes in the 8/14-7/16 sector Tuesday and 8/16-5/20 sector Thursday.
The Treasuries will also announce the next round of auctions which will include
2s, 5s, 7s and 30 year TIPS.
o
Primary
Dealer
SECTOR NEWS WITH MACRO IMPLICATIONS
o
Changes in the latest
Investor's Business Daily 100 List:
Added: IT, SLH, BBD, SRCL, AAP, UGP,
LSTZA, AGU, FCFS, MMP, CCE, ASPS, OPEN, ISLN, ARUN, KRA, ALK. Deleted: CAAS, ARMH, BOFI, AAPL, NETL,
ACTL, KSU, NRGP, EMC, CISG, SOA, DLB, XLNX, EL, RHT, GDI, LXK.
o
CHNG China Natural Gas
reports Q2 EPS
o
BIOF BioFuel Energy
reports Q2 EPS
o
RLD, DLB, IMAX Financial Times
discusses the future of 3D films RealD (RLD), Dolby Labratories (DLB), and Imax
(IMAX) are all leveraged to 3D films.
o
GE WSJ discusses
General Electric's GE Capital, and the potential stricter government oversight
it may face
o
GE GE Capital hopes to
open internet bank in UK within 18 months - Sunday Times
o
GY Aerojet's Ramjet
propulsion engine successfully meets Coyote high diver mission requirements-
Breitbart
o
ADG Allied Defense
reports Q1 EPS
o
CNAM China Armco Metals
reports Q3 EPS
o
BEST Shiner International
reports Q2 EPS
o
BEZ Baldor Electric
files mixed securities shelf of indeterminate amount
TECH/MEDIA/TELECOM
o
GOOG Google close to
acquiring Like.com - TechCrunch
o
Technology
Trader does not see Cisco (CSCO)
shares gaining much ground until there is a sign that corporate IT shows signs
of buying, instead of being unusually conservative, as CEO Chambers commented
last week. –Barron’s
o
Plugged
in: believes Apple (AAPL) should declare
its intentions regarding its $46B cash hoard. –Barron’s
o
Gadget
of the Week: believes the Amazon (AMZN)
Kindle 3 is a serious contender in the e-Book market. –Barron’s
o
RIMM Research In Motion
offered information to Indian government that would allow it to track down
messages sent via RIMM's email service--WSJ
o
AAPL Apple employee
accused of accepting more than $1M in exchange for confidential information to
Apple suppliers in Asia-- NYT
o
EMMS JS Acquisition once
again extends tender offer to purchase Emmis Communications- PR
o
GLW Corning to acquire
Plaslab S.A.S- PR
o
SBSA Spanish Broadcasting
reports Q2 EPS
o
GOOG, IBM, KO, TWX,
VIA.B
Barron's interview: Morris Mark, president of Mark Asset Management;
Highlighted picks of Mark's firm include: Google, IBM, and Coca-Cola; in all 3
he sees quality at no premium. GOOG: notes that management is constantly
improving its product; Disney: trades at a premium compared to Time Warner and
Viacom but not nearly the premium he feels it deserves. –Barron’s
o
PX Praxair announces
price increases for gases and facility fees effective 1-Sep
o
BW Brush Engineered
Materials shareholder GAMCO discloses 5.6% stake in 13D filing
o
Streetwise:
Michael Santoli believes the bond market is telling us that economic growth
expectations are in peril, and the stock market is ignoring it as a grave risk.
–Barron’s
o
The
Striking Price: discusses the high correlation in stocks right now and the
recent trend to buy index options to hedge stock positions. –Barron’s
o
D.C
Current: discusess the potential outcome of the SEC/CFTC report on the 'Flash
Crash' of May. –Barron’s
o
Economic
beat: says the real growth of GDP will likely be halved at its estimated 27-Aug
release. –Barron’s
o
Fund
of Information: discusses the new SEC rule proposal regarding 12b-1 fee.
–Barron’s
o
Barron's
picks 13 big companies with inexpensive stocks and healthy dividends; Barron's
list includes: Utilities: Entergy (ETR),
NextEra Energy (NEE), CMS Energy (CMS) and Sempra Energy (SRE); Defense contractors: Lockheed
Martin (LMT) and Raytheon (RTN); Oil producers: Chevron (CVX) and ConocoPhillips(COP);
Health-care outfits: Johnson & Johnson (JNJ) and Abbott Laboratories (ABT).
It also includes: Bemis (BMS), Intel
(INTC), and McGraw-Hill (MHP); Barron's notes that history shows
that shares of companies making major investments in dividends outperform those
that make big stock repurchases. –Barron’s
o
GOOG, IBM, KO, TWX,
VIA.B
Barron's interview: Morris Mark, president of Mark Asset Management;
Highlighted picks of Mark's firm include: Google, IBM, and Coca-Cola; in all 3
he sees quality at no premium. GOOG:
notes that management is constantly improving its product; Disney: trades at a
premium compared to Time Warner and Viacom but not nearly the premium he feels
it deserves. –Barron’s
o
HSBC Holdings: Reviewing
their headquarters location in London starting next year; Eyeing possible move
abroad to avoid increasing taxes - Independent
o
RBS.LN Royal Bank of
Scotland may need to take over Liverpool FC - Sunday Times
o
FMBI First Midwest Bank
acquires deposits and loans of Palos Bank and Trust company in FDIC-facilitated
transaction
o
SUPR Superior Bancorp
reports Q2 EPS
o
NNI NelNet announces
agreement in principle regarding lawsuit
o
AWH Allied World
announces repurchase of founding shareholder's warrant from the Chubb
Corporation
TRANSPORTS
o
TAM and Lan Airlines
agree to merger - Reuters
o
WFMI WSJ is positive on
Whole Foods--WSJ
o
SYUT China's Health
Ministry rules out milk powder as cause of onset of puberty in 3 infant girls--
WSJ
o
ADS.GR Barron's notes that
continued success at Reebok could help Adidas gain market share and boost
earnings sharply in coming years
–Barron’s
o
CSTR Barron's sees
Coinstar's DVD rental group as a major film player –Barron’s
o
JCI Barron's cover
article notes that Johnson Controls could outperform significantly in coming
years –Barron’s
o
Supermarkets
in England to be barred from using property deals to freeze out competitors-
London Times
o
BXC Cerberus extends
cash tender offer for Bluelinx Holdings to 3-Sep
o
PNCL Pinnacle Airlines
releases Jul operational results for Mesaba Aviation
o
BGS B&G Foods files
$600M mixed securities shelf
o
CKXE CKX INC reports Q2
EPS
o
JAX J. Alexanders Corp
reports Q2 EPS
o
ELY Callaway Golf
estimates charges associated with reorganization of Chicopee golf ball
facilities
o
MDRX Allscripts-Misys
announces 25M share secondary offering for Misys through Credit Suisse,
Barclays, JPMorgan, UBS per previously announced agreement
o
INO Inovio
Pharmaceuticals reports Q2 GAAP EPS
o
OTIX OTIX Global reports
Q2 EPS ($0.38) from 10-Q; unclear if comparable to Reuters ($0.80) -- 1
estimate
o
WPI Watson
Pharmaceuticals announces FDA approval of ella; intends to launch Q4
o
CBPO China Biologic
Products reports Q2 GAAP EPS
o
BSMD BioSphere Medical
reports Q1 EPS
o
CYCC Cyclacel
Pharmaceuticals convertible exchangeable preferred stockholders request special
meeting to elect directors
REAL ESTATE
o
CSA Cogdell Spencer
enters $40M equity distribution agreement with Citi and KeyBanc
o
CRE Care Investment
Trust announces completion of sale of control to Tiptree Financial Partners;
expiration of cash tender offer
o
Energy
o
Cairn Energy + 3.25%. Agrees to sell 51% of Cairn India to Vedanta (+ 6%).
o
Gulfsands – 4.3%. No oil at Tunisia site.
o
Metals&Mining
o
Petropavlovsk + 2%. Talk of HK IPO of iron ore unit (DJ)
o
Xstrata +0.5%, demand for coking coal robust.
Japan
o
Hong Kong
o
China
o
INVESTMENT
BANKING
INVESTMENT BANKING
WRAP
M&A
o BAC Bank of America weighs reducing BLK Blackrock stake- WSJ
o The paper said that the bank has concluded
that its 34 percent share of BlackRock Inc isn't a core asset
o Still, no talks have been held about details
of how it might happen, and the bank may keep the 64.7 million common and
preferred shares of BlackRock that it owns
o http://www.reuters.com/article/idUSN1521626220100815
o Vedanta to buy stake in Cairn India for $8.5-9.6bln- Reuters
o India-focused miner Vedanta Resources (VED.L)
said it will buy 51-60 percent of Cairn India (CAIL.BO) for about $8.5-9.6
billion in cash to be funded with debt and cash
o http://www.reuters.com/article/idUSLDE67F07420100816
o Pension group Paternoster put up for sale- FT
o Paternoster, the specialist pensions business
set up by former Prudential executive Mark Wood, has been put up for sale, with
its original backers facing the potential loss of more than half their £500m
equity investment
o http://www.ft.com/cms/s/0/f7804268-a89e-11df-86dd-00144feabdc0.html
o Rival bidders line up for Dana Petroleum- Telegraph
o A Canadian oil company and an energy group
from India are studying the possibility of entering the takeover battle for
London-listed Dana Petroleum
o Oil & Natural Gas Corporation (ONGC),
India's biggest exploration company, was also tipped as one of the most likely
acquirers. ONGC has a track record of successfully carrying out public UK
merger and acquisition transactions
o GENZ Genzyme has little leverage to play hardball- Reuters
o Biotechnology company Genzyme Corp may be
holding out for more money from suitor Sanofi-Aventis, but will find it
difficult to persuade investors it is better off on its own.
o If Genzyme rejects Sanofi, the maker of drugs
for rare and chronic diseases would have to justify to its shareholders that it
can do a better job of resolving its manufacturing problems and providing
stronger returns on its own.
o http://www.reuters.com/article/idUSN1322203220100813
o Britain's RSA gets $7.8 billion backing from banks- Reuters
o RSA (RSA.L) has secured backing from three
major banks for at least 5 billion pounds ($7.8 billion) in equity if the
British insurer can pursue its bid for Aviva's (AV.L) non-life unit in the UK,
Canada and Ireland
o http://www.reuters.com/article/idUSTRE67F04L20100816
o South Africa's Aspen to buy Sigma drugs arm for $804 million- Reuters
o Sigma's shares jumped as much as 7 percent on
the deal, in a broader market that was down 1.1 percent, as the sale moved it
closer to resolving its debt woes.
o http://www.reuters.com/article/idUSTRE67F04G20100816
o Suzlon may sell RE power pie for $500 million- Economic Times
o The transaction will be done through a mix of
fresh issue of shares by REpower and stake sale by Suzlon. Suzlon owns 90.7% in
REpower and the funds from the stake sale could be used by the Indian
wind-turbine maker to pare its total debt of around `10,000 crore,
o Britax Childcare up for sale by Carlyle- Telegraph
o The company has hired Rothschild to advise it
following approaches from potential trade and financial bidders
o OT says Ramadan may be delaying Djezzy talks- Reuters
o Orascom said in May it would start talks to
sell the unit, its top revenue earner, to the government after Algeria refused
to let Orascom sell Djezzy to South Africa's MTN (MTNJ.J). But talks have yet
to begin
o http://www.reuters.com/article/idUSTRE67E0PL20100815
o Advent plans to sell or spin off Takko- FT
o US. private equity firm Advent International
plans to sell or spin off Takko Fashion, one of Germany's fastest-growing
clothing chains valued at about 1.25b euros ($1.6b)
o http://www.reuters.com/article/idUSTRE67E1AG20100815
o Aviva holding out for an offer of at least £8B for its general
insurance division-- London Times
o http://www.thetimes.co.uk/tto/business/industries/banking/article2686507.ece
o RBS preparing to take control of Liverpool FC: report- London Times
o The Royal Bank of Scotland is preparing to
take over Liverpool Football Club as the search for a buyer looks increasingly
likely to end in failure
o http://news.yahoo.com/s/afp/20100815/sp_soccer_afp/fblengprliverpoolsale
o Tsingtao to buy 45 percent stake in Xihu Beer- Economic Observer
o Tsingtao Brewery, China's best known beer
brand, plans to purchase a 45 percent stake in Hangzhou Xihu Beer Asahi Co for
up to 2 billion yuan ($294.4 million)
o http://www.reuters.com/article/idUSTRE67F02R20100816
o Synergies to add $3 bln to new LAN-TAM group- Reuters
o A merger between Brazil's TAM and Chile's LAN
airlines would generate synergies likely to add some $3 billion in value to the
new group
o http://www.reuters.com/article/idUSN1420342620100814
o China consortium may bid for 30pct stake in AIA- Reuters
o consortium of leading Chinese companies
including Industrial and Commercial Bank of China, China Life Insurance, plans
to bid for a 30 percent stake in American Insurance Group Ltd's Asia life
insurance business
o http://www.reuters.com/article/idUSTOE67F01R20100816
o GOOG Google To Acquire Like.com After Leaving Them At The Altar In
2005- TechCrunch
o In late 2005 Google was on the verge of
acquiring a company called Riya – the first real attempt at image facial
recognition and tagging for consumers. Google eventually walked away from Riya,
and the company trudged on
o In 2009 the Riya product was shut down, but
the company had already refocused its efforts on ecommerce – using the Riya
core technology to let people search visually by seeing images that are similar
to other images. Like.com was born
o http://techcrunch.com/2010/08/15/google-to-acquire-like-com-after-leaving-them-at-the-altar-in-2005/
o Wuhan Steel, ArcelorMittal discuss iron ore tie-ups- Reuters
o China's Wuhan Iron and Steel Group is in talks
with ArcelorMittal (MT.N), the world's top steelmaker, on the joint development
of overseas iron ore
o http://www.reuters.com/article/idUSTOE67F06K20100816
o Australia's AWB says gets $1.1 bln bid from Agrium- Reuters
o Australia's AWB (AWB.AX) said on Monday it had
received a A$1.2 billion ($1.07 billion) takeover bid from Canadian fertilizer
maker Agrium Inc (AGU.TO), threatening to trump an earlier offer from GrainCorp
(GNC.AX).
o http://www.reuters.com/article/idUSSYU01047820100815
o Ruling on Mexico's Televisa-Nextel deal delayed- Reuters
o Mexico's telecommunications regulator Cofetel
delayed until next week a controversial vote on whether to allow leading
broadcaster Televisa entry into the mobile phone business
o http://www.reuters.com/article/idUSN1322478620100814
$ RAISING
IPOs
o AgBank confirms greenshoe as IPO hits record $22.1 billion- Reuters
o Agricultural Bank of China (AgBank) said on
Sunday it had fully exercised an over-allotment option for the Shanghai portion
of its initial public offering, taking total proceeds from the offer to $22.1
billion, making the IPO the world's biggest
o http://www.reuters.com/article/idUSTRE67E0K820100815
o BofA, Citi added as lead GM IPO underwriters- Reuters
o Initial paperwork for the IPO is now expected
to be filed with the U.S. Securities and Exchange Commission early next week,
several sources familiar with the situation said.
o http://www.reuters.com/article/idUSTRE67B4JW20100814
o As Summer Fades,
Dreams of IPOs to Come- WSJ
o
As the IPO market heads off for summer vacation this
week, bankers and investors are left to ponder what the new-issuance landscape
will look like when deals begin lining up again after Labor Day.
o http://online.wsj.com/article/SB10001424052748703321004575427954141892006.html
o U.S. video viewing site Hulu plans an IPO- Reuters
o The company, which streams popular shows like
"Glee" and "Modern Family," is in talks with investment
banks to go public as soon as this fall
o http://www.reuters.com/article/idUSTRE67F0X120100816
o Pre-sale float considered for Center Parcs- FT
o Blackstone, the private equity group, is
exploring the creation of a listed vehicle to help structure the sale of the
majority of its Center Parcs business to M&G Investments
o http://www.ft.com/cms/s/0/5b0d6976-a6f8-11df-90e5-00144feabdc0.html
PRICINGS
o Initial Offerings
o
LRP Legacy Healthcare
Properties Trust
Inc 8.75m share IPO expected to price 8/19 via Jefferies and Stifel: Price Talk
$20
o Secondary Offerings
o
No secondaries currently scheduled to price next week
NEWS
o RSA secures £5bn
backing from banks- FT
o
RSA has commitments from three leading investment
banks that they could raise at least £5bn in equity for the UK’s largest
general insurer if it can pursue its bid for the UK, Canada and Ireland
operations of Aviva’s general insurance division
o
http://www.ft.com/cms/s/0/dc2162aa-a893-11df-86dd-00144feabdc0.html
o
Utilities: BEZ Baldor Electric files mixed securities shelf of
indeterminate amount
o
Consumer: BGS B&G Foods files $600M mixed
securities shelf
o
Healthcare: MDRX Allscripts-Misys announces 25M
share secondary offering for Misys through Credit Suisse, Barclays, JPMorgan,
UBS
o
TODAY’S EVENTS
o
China
Entrepreneurs Real Estate Fund Forum - Aug 15, 2010 - Aug 16, 2010
o
Engineering
Conferences International: Nanofluids Fundamentals and Applications II
Conference - Aug 15, 2010 - Aug 19, 2010
o
Hart
Energy's Crude Oil to Biofuels:Trends Impacting Global Fuels - Aug 16, 2010
o
Lazard
Capital Markets MAGIC Retail & Apparel Conference - Aug 16, 2010 -
Aug 18, 2010
o
Nine
Dot Nine Interactive Pvt Ltd.: CTO Forum - Aug 15, 2010 - Aug 18, 2010
o
SuccessFactors:
SuccessConnect - Gold Coast - Aug 15, 2010 - Aug 16, 2010
o
TDWI
Business Intelligence Executive Summit - Aug 16, 2010 - Aug 18, 2010
o
TDWI
World Conference - Aug 15, 2010 - Aug 20, 2010
o
Terrapinn
Education Outlook Australia Conference - Aug 16, 2010 - Aug 18, 2010
o
The
Center for Business Intelligence Annual Forum on Tracking State Laws and
Aggregate Spend - Aug 16, 2010 - Aug 18, 2010
o TODAY’S EVENTS
o
Shareholder
Meetings
§
IGC,
DLNO
o ECONOMICS
o
0830
Empire State Manufacturing Survey
o
0900
Treasury International Capital Data
o
1000
NAHB Housing Market Index
o EARNINGS
o Autos
·
SUP,
CALI
o Materials
·
GFRE,
ONP, VAL
o Consumer/Retail/Education
·
NWY,
URBN, LOW, ARKR, DRJ, HAST, NLS, CPY, SYY, YUII, GLOI
o
Energy
·
PUDA,
IOC, AXAS, FEEC, PEIX
o Financials
·
DFR,
FMD
o Gaming, Lodging,
& Leisure
·
RICK
o Healthcare
·
GTF,
SVA, CMED, CONM, APNC, CPIX, EMIS
o Industrials/Homebuilders
·
XNN,
CCLTF, AXPW, ENSL, NEWN, SOPW, A, DGLY, ICXT, RINO, CWS, NFEC, WUHN
o
Tech/Telecom
·
AZPN,
BITS , WYY, EMKR, INVE, BEAC, PWRD, LONG, ITCD, SBAY, DIET, HOLL, VITC, KITD,
ONSM, TKOI
***All
eco data from Bloomberg and DJ
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information purposes only. It is not intended to form the basis of any
investment decision, should not be considered a recommendation by Cantor or any
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