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Posts Tagged ‘Reuters’
Frontrunning: May 22
Wednesday, 22 May 2013 06:29
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  • Apple Bonds Stick Buyers With $280.6 Million Loss as Rates Climb (BBG)
  • Iceland Freezes EU Plans as New Government Shuns Euro Crisis (BBG)
  • “Transparent Fed” – Ben Bernanke meets privately with Darrell Issa (Politico)
  • Bank of Japan vows market steps to curb bond turbulence (Reuters) holds policy (FT)

    • (Read more…)

  • Stockholm riots spread in third night of unrest (FT)
  • Dudley Says Decision on Taper Will Require 3-4 Months (BBG)
  • Senate panel passes immigration bill; Obama praises move (Reuters)
  • Italy to outline youth jobs plan as government struggles (Reuters)
  • Apple CEO Tim Cook, Lawmakers Square Off Over Taxes (WSJ)
  • Google Joins Apple Avoiding Taxes With Stateless Income (BBG)
  • Sony Board Discussing Loeb’s Entertainment IPO Proposal (BBG)
  • Vote Strengthens Dimon’s Grip (WSJ), Dimon performance well choreographed (FT)

 

Overnight Media Digest

WSJ

* Federal investigators apparently accessed records of calls to and from a phone number at Fox News Channel in their leak investigation of a former state department contractor, according to a court document.

* Insecticide sales are surging after years of decline, as American farmers plant more corn and a genetic modification designed to protect the crop from pests has started to lose its effectiveness.

* Starwood Capital Group is in talks to buy seven U.S. shopping malls from Westfield Group for more than $1 billion, a deal that would mark the latest in a flurry of big ticket acquisitions of retail property. Starwood’s talks with Westfield aren’t yet in the final stages and still could collapse, according to people familiar with the matter.

* A lawsuit brought by auto dealers has put a chill on the potential sale of R.L. Polk & Co, owner of the used-car shopping tool Carfax, according to people familiar with the matter. Polk, which provides car companies and consumers with data on autos, attracted interest from some potential corporate buyers as well as a host of private equity firms, including buyout giants Carlyle Group LP and KKR & CO LP, the people said.

 

FT

Apple Inc Chief Executive Tim Cook defended the technology company’s tax practices, saying Apple did not depend on “tax gimmicks” as U.S. senators grilled him over charges that the company avoided billions of dollars in taxes on international profits.

A majority of JPMorgan Chase & Co shareholders voted to let Jamie Dimon keep his chairman title, handing him a decisive victory over shareholder activists who wanted to strip him of the role.

BP has stepped up appeals against what it says are unjustified compensation payments under the settlement it reached with those affected by the 2010 Gulf of Mexico oil spill.

Europe’s banking regulator has broadened its bonus cap rules to bring in far more bankers within the scope of the regulation.

G4S Chief Executive Nick Buckles has stepped down with a 16 million pound package following a series of embarrassments, raising shareholder fears over the future direction of the company.

Some of Royal Dutch Shell’s shareholders called for a rethink of the company’s Alaska plans amid questions over the company’s troubled drilling programme there.

 

NYT

* Other countries have long been annoyed by Irish tax laws, but the benefit to the struggling country’s economy means the rules are unlikely to change.

* Tim Cook came to Capitol Hill prepared to face down senators furious over evidence that Apple Inc had avoided paying billions in taxes, but he left having won many of them over.

* James Bullard, a member of the Federal Reserve’s policy committee, warned Europe of becoming trapped in the economic stasis from which Japan is only now emerging.

* Microsoft’s new Xbox game console also serves as a home entertainment hub, a response to the rising popularity of mobile devices for playing games.

* A lawyer argued that Rajat Gupta, found guilty of leaking boardroom discussions, should be granted a new trial because a judge erroneously admitted wiretapped conversations.

 

Canada

THE GLOBE AND MAIL

* Civic leaders are adding to a chorus of calls on Toronto Mayor Rob Ford to clear the air about allegations of drug use amid growing concern that the scandal has derailed council’s business of governing.

* Without more support for industry investment in research and development, Canada will be hard-pressed to keep up with international competitors and will risk an erosion of its economic wellbeing, a report on the state of the nation’s science and technology landscape by the Science, Technology and Innovation Council has revealed.

Reports in the business section:

* The damage to the ground immediately surrounding an oil car that derailed on Tuesday and spilled some of its contents in rural Saskatchewan is apparently contained. On Tuesday morning, five tank cars carrying crude oil and operated by Canadian Pacific Railway Ltd derailed outside the town of Jansen, Saskatchewan.

NATIONAL POST

* Federal NDP Leader Tom Mulcair says he was contacted by the provincial police anti-corruption squad in Quebec to discuss a suspected 17-year-old bribe offered to him. Mulcair says he never reached out to the police himself because he had no proof a bribe was actually being offered at a 1994 meeting with the now controversial ex-mayor of Laval, Quebec, Gilles Vaillancourt.

* Canada is investigating allegations that Eritrea’s diplomatic mission in Toronto has continued soliciting money for the East African regime’s military despite being warned by the Department of Foreign Affairs to stop.

FINANCIAL POST

* Gold mining stocks have been decimated in recent months, but Jamie Sokalsky does not think investors should expect any corresponding uptick in merger and acquisition activity. Speaking at the Bloomberg Canada Economic Summit, the chief executive of Barrick Gold Corp said there is a general “anti-M&A” mood in the gold space right now, and that investors don’t even ask him about it much anymore.

* Concerns are being raised that efforts to improve efficiency at Canadian Pacific Railway are contributing to a series of accidents at the railroad in recent months, including two more this week.

 

China

CHINA SECURITIES JOURNAL

– The China Securities Regulatory Commission should focus on its key duties of regulating the market and delegate unnecessary duties to other departments gradually, its Chairman Xiao Gang said on Tuesday.

SHANGHAI SECURITIES NEWS

– A major gold deposit with estimated reserves of 53 tonnes was discovered in Yili Valley of China’s northwestern Xinjiang province, government data showed. Total gold resources at the field are expected to exceed 100 tonnes, with a potential value of about 20 billion yuan ($3.26 billion).

CHINA DAILY

– Local government officials said Dongguan in Guangzhou province remains a top destination for processing trade businesses, despite recent closures in the city being blamed on the continued strength of the yuan.

– The Shanghai government plans to allow cold-processed poultry meat to return to the market by the end of May as there have been no new confirmed cases of the H7N9 virus in China for more than a week, giving the poultry industry a chance to recover.

SHANGHAI DAILY

– Cosco Pacific Ltd, the container-terminal arm of China’s biggest shipping group, agreed to sell its stake in the world’s largest shipping-container manufacturer to its parent for $1.22 billion, according to a Hong Kong Stock Exchange filing.

– Three rice mills in central China’s Hunan province are being investigated after cadmium was found in their rice last week, local authorities said last week. The mills were ordered to recall their products and suspend business operations, according to a statement released by the county government.

 

Corporate Finance

* Australia’s Westfield Group is in talks to sell seven U.S. shopping malls to private real estate investment company Starwood Capital Group for more than $1 billion, a source said on Wednesday.

* Roche Holding AG teamed up with Sigma-Aldrich Corp to make an unsuccessful bid for Life Technologies Corp earlier this year, people familiar with the matter said.

* U.S. prosecutors are considering charging Steven Cohen’s SAC Capital Advisors as a criminal enterprise engaged in a long pattern of insider trading in stocks, according to a person familiar with the matter.

* Telecom Italia SpA is mulling spinning off its mobile unit along with its fixed-line network to bring new investors on board, three people, including a senior political source, told Reuters on Tuesday.

* Singapore state investor Temasek Holdings Pte Ltd has paid $500 million for a stake of around 10 percent stake in financial data provider Markit Group, a person familiar with the transaction said.

* Britvic Plc’s new chief executive is set to lay out plans for the soft drinks maker to continue as a standalone company, casting further doubt on its proposed merger with A.G. Barr Plc, Sky News reported, citing people close to Britvic.

* A boutique carmaker led by former General Motors Co executive Bob Lutz and China’s largest auto parts supplier made an offer this month to buy cash-strapped “green” car company Fisker Automotive, people familiar with the matter said.

* Chevron Corp is in advanced talks to sell most of its downstream assets in Egypt and Pakistan, three sources said, with the planned disposals seen raising around $300 million for the U.S. oil major.

* Finnish paper firm Ahlstrom Oyj is set to secure European Union approval for the merger of its label unit with Munksjo to form the world No. 1 speciality paper maker after agreeing to sell a German business, a person familiar with the matter said on Tuesday.

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

Bristol-Myers (BMY) upgraded to Buy from Neutral at Citigroup
CVR Energy (CVI) upgraded to Neutral from Underperform at Macquarie
Cree (CREE) upgraded to Buy from Neutral at Sterne Agee
Roche (RHHBY) upgraded to Buy from Neutral at Citigroup
Terex (TEX) upgraded to Overweight from Equal Weight at Barclays
Volcano (VOLC) upgraded to Overweight from Equal Weight at First Analysis

Downgrades

Caesar’s Entertainment (CZR) downgraded to Neutral from Outperform at Credit Suisse
Carnival (CCL) downgraded to Neutral from Overweight at HSBC
Chart Industries (GTLS) downgraded to Hold from Buy at BB&T
Dick’s Sporting (DKS) downgraded to Market Perform from Outperform at BMO Capital
EPIQ Systems (EPIQ) downgraded to Market Perform from Outperform at William Blair
EQT Corporation (EQT) downgraded to Hold from Buy at Societe Generale
InterXion (INXN) downgraded to Neutral from Buy at Goldman
Joy Global (JOY) downgraded to Equal Weight from Overweight at Barclays
Newcastle (NCT) downgraded to Market Perform from Outperform at Keefe Bruyette
Rosetta Resources (ROSE) downgraded to Neutral from Outperform at Cowen
SodaStream (SODA) downgraded to Neutral from Overweight at JPMorgan
UBS (UBS) downgraded to Underperform from Market Perform at Keefe Bruyette
Warner Chilcott (WCRX) downgraded to Market Perform from Outperform at Leerink

Initiations

Chart Industries (GTLS) initiated with an Outperform at Raymond James
Coca-Cola (KO) initiated with a Market Perform at BMO Capital
Cott Corp. (COT) initiated with a Market Perform at BMO Capital
Dr Pepper Snapple (DPS) initiated with a Market Perform at BMO Capital
Galena Biopharma (GALE) initiated with an Outperform at JMP Securities
Monster Beverage (MNST) initiated with an Outperform at BMO Capital
PepsiCo (PEP) initiated with an Outperform at BMO Capital
Popular (BPOP) initiated with an Outperform at Wells Fargo

HOT STOCKS

Saks (SKS) rallied after NY Post reported Goldman Sachs (GS) hired for possible sale
Merck (MRK) announced $5B share repurchase
Moody’s placed Carnival’s (CCL) A3 rating on review for possible downgrade
Ford (F) raised North American capacity by 200,000 units, reduced summer shutdown, added jobs
NetApp (NTAP) reducing workforce by 900, expects $50M-$60M charge
BNY Mellon (BK) plans to increase Wealth Management sales force by 50%

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
Toll Brothers (TOL), Dycom (DY), NetApp (NTAP), Intuit (INTU)

Companies that missed consensus earnings expectations include:
Staples (SPLS)

Companies that matched consensus earnings expectations include:
Compuware (CPWR), Analog Devices (ADI)

NEWSPAPERS/WEBSITES

  • Since the financial crisis, bonds backed by a single loan have been less common than securities made up of a group of unrelated loans. But the market for loans on commercial properties has changed in recent months and is booming again–$12.1B so far this year–the Wall Street Journal reports
  • Big phone companies (SAP, T, TEF, VZ, VOD, CCO) have begun to sell the vast amounts of data they gather about their subscribers’ locations, travels and Web-browsing habits. The information provides a powerful tool for marketers but raises new privacy concerns, the Wall Street Journal reports
  • Apple’s (AAPL) ability to shelter billions of dollars of income from tax has depended on an unusual loophole in the Irish tax code that helps the country compete with other countries for investment and jobs. Apple channeled profits into Irish-incorporated subsidiaries that had no declared tax residency anywhere in the world, Reuters reports
  • The dollar languished well below last week’s 4 1/2-year high against the yen today, ahead of testimony from the Fed Chairman Bernanke after two regional Fed presidents hinted that the central bank will continue its bond-buying scheme, Reuters reports
  • Samsung (SSNLF) and LG Electronics are reworking their strategies for high-end TVs after spending billions of dollars on a new display technology that’s behind schedule and costs nearly $10,000 a set. The misstep has created an opening for Sony (SNE), Sharp (SHCAY) and Chinese maker Skyworth Digital, Bloomberg reports
  • Apple’s (AAPL) bonds have lost $280.6M of market value since buyers snapped up $17B of the iPhone maker’s debt last month, declining as yields climb from record lows, Bloomberg reports

SYNDICATE

Aeterna Zentaris (AEZS) may sell up to 2.5M common shares for up to $4.6M
Alcobra (ADHD) 3.125M share IPO priced at $8.00
Baltic Trading (BALT) files to sell common stock
CVR Partners (UAN) files to sell 12M shares for CVR Energy interests
Cadiz (CDZI) files to sell 9.69M shares of common stock for holders
Ironwood (IRWD) 10.5M share Secondary priced at $13.00
M/A-COM (MTSI) files to sell 9.24M shares of common stock for holders
NPS Pharmaceuticals (NPSP) 6M share Secondary priced at $14.53
PGT (PGTI) 11M share Secondary priced at $7.75
Portola Pharmaceuticals (PTLA) 8.423M share IPO priced at $14.50
Sensata (ST) announces 12.5M common share offering by selling holders

    



 
South African Strike Season Is Back As Ten Workers Are Shot By Rubber Bullets
Tuesday, 21 May 2013 08:40
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It was a year ago that escalating labor tensions in the country of South Africa ground its mining sector to a halt, when demands from striking workers for wage hikes were met with aggressive retaliation in the form of rubber bullets first and then very real ones, leading to a tragic collapse in the already tenuous relationship between foreign corporations and domestic labor unions. Also notably, back then collapse in production of such commodities as platinum and gold was not all that confusing for the market, and led to price surges on the realization what far lower supply means for equilibrium prices. Yet while the days of violent labor escalation appear to be back, this time the Newer Normal has established itself by representing that a drop in industrial and precious metal production is somehow price negative. In (Read more…) when it comes to commodities, everything has become a negative catalyst, very much the way every update in the equity world is positive for “values.”

So since Bernanke is intent on representing the complete collapse between physical supply dynamics and spot paper prices as bearish, we anticipate a major takedown in all metals once the algos grasp that the South African violence is back on the radar screen. Reuters reports that following news that the South African gold mining union demands a wage hike up to 60%, “ten striking South African miners were taken to hospital on Tuesday after being hit by rubber bullets, police said, as labor strife swells in mines and factories ahead of mid-year pay negotiations.”

So much for calm negotiations.

Auto maker Mercedes-Benz said a two-day wildcat stoppage at its East London plant had ended but the National Union of Metal Workers of South Africa (NUMSA) squashed any relief with an immediate demand for a 20 percent pay rise.

 

“If our demands are not met we will have no option but to go to the streets,” NUMSA national treasurer Mphumzi Maqungo told Reuters.

 

The currency extended its two-week slide after police confirmed that security guards had fired rubber bullets at stone-throwing wildcat strikers at a chrome mine near the platinum belt town of Rustenburg, 120 km (70 miles) northwest of Johannesburg.

 

The mining firm, Germany’s Laxness, said the guards had fired rubber bullets in self-defence into the ground in front of protesters.

“Strike season” appears to have come early in South Africa this year:

Last week, the platinum firm Lonmin suffered a wildcat walkout at Marikana shortly after an unknown gunman shot dead a senior union official in a bar, and the National Union of Mineworkers said it would push for a pay rise of a staggering 60 percent for some categories of miner.

 

South Africa’s car makers saw minor labor disruptions in 2012 but investors fear a repeat of the wage-related strikes that crippled the sector in 2010 as the economy was struggling to emerge from recession.

 

Car industry bosses said they would not entertain NUMSA’s latest demands, setting the stage for a showdown when a three-year wage deal worth around 10 percent a year expires at the end of next month.

 

“It is common cause that the employers will not settle at 20 percent,” said Thapelo Molapo, chairman of the Automobile Manufacturing Employers’ Organisation.

Ironically, the local instability has translated into a plunge in the local currency which recently printed at 9.50 to the dollar, the weakest since early 2009, and with the slide accelerating another 6% in the past two weeks, inflation in South Africa is set to accelerate even more, pushing for even higher wage demands, which will be met with even more hostility and resistance out of local foreign companies.

“There is no way people are going to carry on putting their money in here when there are impending strikes in one of the biggest sectors in South Africa,” said Kyle Dutton, a broker at Mercato Financial Services in Johannesburg.

While for now it is the automotive sector that has seen the bulk of the wage “negotiations”, expect this to spill over to all other industries, and specifically the critical mining sector, where South Africa is a sizable producer for both platinum and gold. We can’t wait to see just how the spin machine justifies the halt of their production with more double digit drop in gold and/or silver, both of which are now trading with the forced credibility of pennystocks, and where 10% daily trade ranges are the real new normal.

    



 
Frontrunning: May 21
Tuesday, 21 May 2013 06:48
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  • IMF Tells Central Europe to Spend More (WSJ)
  • Tornadoes Blast Oklahoma (WSJ)
  • Frenetic search for survivors as 91 feared dead in tornado-hit Oklahoma (Reuters)
  • JPMorgan investors on edge over vote on Dimon; what if they win? (Reuters)

    • (Read more…)

  • Wealthy bank depositors to suffer losses in EU law (Reuters)
  • Yen Slips as Amari Backtracks (BBG)
  • Japan Ready for More Yen Weakness Despite Recent Comments (WSJ)
  • IRS officials back on Capitol Hill hot seat over targeting (Reuters)
  • Li Keqiang pledges China boost to India trade (FT)
  • Europe’s Recession Sparks Grass-Roots Political Push (WSJ)
  • Obama and Xi to meet in effort to calm growing US-China rivalry (FT)
  • Berlin plans to streamline EU but avoid wholesale treaty change (FT)
  • France must reform or face punitive measures – EU’s Oettinger (Reuters)
  • Tumblr’s 26-Year-Old Founder Celebrates $1.1 Billion Deal (BBG)
  • SocGen Joins UniCredit in Warsaw as Equity Sales Surge (BBG)

 

Overnight Media Digest

WSJ

* JPMorgan Chase & Co is preparing for a shake up of its board even if every director wins re-election at Tuesday’s shareholder meeting and James Dimon keeps his dual job as chairman and chief executive.

* Even in the fast growing realms of the consumer Internet, some businesses are best served by old fashioned consolidation. GrubHub and Seamless, two nationwide startups used for ordering restaurant takeout by smartphone and computer, said they would merge. GrubHub Chief Executive Matt Maloney, who will lead the combined company, declined to discuss valuation.

* Here is a glimpse at the future of finance. When Deutsche Bank AG set out to win a role on Apple Inc’s $17 billion bond, it eschewed Wall Street’s traditional tactics. Instead of flying well-groomed bankers to Cupertino, California, to charm Apple’s top executives with powerpoint presentations, Deutsche relied on iTunes. The German bank has handled the back office work for Apple’s online store in recent years, according to people familiar with the situation.

* Aware that it needs China’s sweet tooth, Hershey Co is rolling out a Chinese brand designed for the world’s fastest growing candy market. In a first launch beyond the U.S. market, Hershey is unveiling on Tuesday a candy known in English as the Lancaster and in Chinese as Yo-man. Hershey will officially open its Shanghai-based Asia Innovation Center on Wednesday. It will be company’s second-largest research and development center world-wide.

 

FT

The U.S. Senate accused Apple Inc of paying little or no taxes to governments around the world by using loopholes and Irish units that are not tax residents of any country.

Actavis said it would by rival Warner Chilcott in a $5 billion deal that would see the combined company become the world’s third-largest generic drug company by sales.

ENRC’s co-founders, who are bidding to take control of the miner, are likely to be able to buy the company for a low price, analysts said.

India’s Essar Oil will sign a loan-for-oil deal with state-run China Development Bank under which the bank will provide the company with a loan in exchange for oil shipments to PetroChina.

The European Commission is seeking new information from trading houses, including Glencore, as part of its probe into the manipulation of energy price benchmarks.

 

NYT

* Yahoo’s $1.1 billion proposed acquisition of Tumblr is a huge coup for the young founder of the even younger start-up and a splashy move by Marissa Mayer to shake up her company. It also heralds a larger shift in social media. Facebook arguably invented modern social networking, and is still the king. But increasingly its approach is seen as passive and outdated as people flock to sites like Tumblr where they can be more actively engaged in creating personal, expressive content to share – and which could potentially translate to advertising dollars.

* Even as Apple became the nation’s most profitable technology company, it avoided billions in taxes in the United States and around the world through a web of subsidiaries so complex it spanned continents and went beyond anything most experts had ever seen, Congressional investigators disclosed on Monday.

* SAC Capital Advisors is bracing for another round of withdrawal requests as fears grow that insider trading investigations could further damage Steven Cohen and his firm.

* Courts are looking to Urban Dictionary, a crowd sourced website, as one way to define words on which a case may turn.

* While companies weigh bids for Hulu and industry heavyweights complain that TV Everywhere isn’t going much of anywhere, another way to watch time-shifted television is quietly gaining traction: video-on-demand, or VOD.

* The Obama administration and the European Union have each decided to negotiate settlements with China in the world’s largest anti-dumping and anti-subsidy trade cases involving China’s roughly $30 billion a year in solar panel shipments to the West, officials and trade advisers in Beijing, Brussels and Washington said.

* Last week’s disclosure by Ronald Machen Jr, the United States attorney for the District of Columbia, that his office had secretly seized telephone records of Associated Press reporters as part of a leak investigation surprised and shocked many people. But to some on Wall Street, Machen’s involvement in a phone records case had a familiar ring. They recalled the case of Allied Capital, a formerly high-flying business development company based in Washington whose shares collapsed in 2009. Two years earlier, Allied had admitted that one of its investigators had stolen the phone records of a prominent hedge fund manager who had been critical of the company’s accounting practices. The chief outside lawyer counseling Allied was Machen, then a partner at WilmerHale.

* Japan’s Prime Minister Shinzo Abe’s economic shock therapy, which combines a flood of cheap cash, fiscal stimulus and deregulation, is getting early results.

 

Canada

THE GLOBE AND MAIL

* When Toronto city council meets Tuesday morning to formally kill the proposal for a downtown casino, it will end for good what was once a pet project for mayor Rob Ford.

The meeting will also be the first time the beleaguered mayor must face his council colleagues since accusations he was videotaped smoking crack cocaine surfaced last week. (http://link.reuters.com/heg38t)

Reports in the business section:

* Alaska proposed a multiyear, multimillion dollar plan aimed at determining the true oil and gas potential in the Arctic National Wildlife Refuge. State officials hope the plan will reinvigorate and reshape the debate over whether to drill on the refuge’s coastal plain. (http://link.reuters.com/peg38t)

NATIONAL POST

* Canadian Prime Minister Stephen Harper will head to South America this week to suss out membership in a new trading bloc he has been working to join for many years.

The Pacific Alliance was formed by Chile, Colombia, Mexico and Peru in 2011 and Canada took a spot on the sidelines the next year, along with several other countries as observers. (http://link.reuters.com/reg38t) (Compiled by Avik Das in Bangalore)

 

China

PEOPLE’S DAILY

- Chinese Premier Li Keqiang’s visit to India, his first foreign trip since taking office in March, has enhanced the strategic partnership of the two countries, the ruling Communist Party’s newspaper said in a report.

CHINA SECURITIES JOURNAL

- China is expected to further increase supervision of local government debt to prevent risk of defaults.

- Chinese wine makers have applied to the Ministry of Commerce to launch an anti-dumping investigation into sales by European counterparts in China.

SHANGHAI SECURITIES NEWS

- Experts believe the Chinese currency yuan has the potential to rise further in the near term as China steps up exchange rate reforms. Driven by strong capital inflows into China, the central bank has guided the yuan to a slew of record highs since early April.

- Bank stocks are still being favoured by Chinese investors and have led a recent rally in China’s stock market, although foreign investors have been withdrawing from the Chinese sector.

CHINA DAILY

- China’s marine economy will account for 13 percent of the country’s GDP by 2020, a government think-tank said on Monday. The China Institute for Marine Affairs said the sector would be worth more than 10 trillion yuan ($1.63 trillion) by then.

- Many of China’s first-tier cities are “barely suitable for living”, according to a report released on Sunday by a top Chinese think-tank. Beijing, Shanghai and Guangdong all failed to make the list of “habitable cities”.

SHANGHAI DAILY

- The number of weddings in Shanghai skyrocketed more than 800 percent to 3,766 on Sunday alone, as happy couples flocked to tie the knot. May 20 is seen as an auspicious date in China.

Corporate Finance

* Charlie Ergen, the chairman of U.S. satellite company Dish Network Corp, has offered to buy bankrupt broadband company LightSquared Inc’s wireless airwaves, a source close to Ergen told Reuters. Bloomberg reported the offer to be valued at $2 billion, citing people familiar with the bid.

* U.S. private equity firm Riverstone Holdings LLC is planning to invest as much as $1 billion in a new commodities venture run by Deutsche Bank AG former head of commodities David Silbert, the Financial Times reported.

* India’s Essar Oil Ltd will sign a $1 billion loan deal with China on Tuesday that sources with knowledge of the matter said would be backed by supply of refined products to top state oil producer PetroChina Co Ltd.

* Specialty chemicals producer Rockwood Holdings Inc’s pigments businesses have attracted offers from buyout firms including Blackstone Group LP and Advent International Corp, several people familiar with the matter said.

* Italian motorway operator Atlantia SpA is close to selling its transmission towers to U.S. investors for almost 100 million euros ($128.56 million), a source close to the matter said on Monday.

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

American Tower (AMT) upgraded to Outperform from Neutral at Macquarie
BlackRock (BLK) upgraded to Outperform from Neutral at Macquarie
Con-way (CNW) upgraded to Buy from Hold at Wunderlich
Cubist (CBST) upgraded to Hold from Sell at Cantor
Felcor Lodging (FCH) upgraded to Buy from Neutral at SunTrust
IntercontinentalExchange (ICE) upgraded to Outperform from Neutral at Macquarie
Stifel Financial (SF) upgraded to Market Perform from Underperform at Wells Fargo
T. Rowe Price (TROW) upgraded to Outperform from Market Perform at Bernstein
Wet Seal (WTSL) upgraded to Buy from Hold at KeyBanc

Downgrades

Acquity Group (AQ) downgraded to Neutral from Buy at Roth Capital
Beazer Homes (BZH) downgraded to Neutral from Buy at Sterne Agee
CME Group (CME) downgraded to Neutral from Outperform at Macquarie
Carnival (CCL) downgraded to Neutral from Buy at UBS
Coach (COH) downgraded to Equal Weight from Overweight at Morgan Stanley
Deutsche Bank (DB) downgraded to Neutral from Overweight at JPMorgan
First Republic Bank (FRC) downgraded to Hold from Buy at Jefferies
Franklin Resources (BEN) downgraded to Neutral from Outperform at Macquarie
Life Technologies (LIFE) downgraded to Underperform from Outperform at CLSA
Oil States (OIS) downgraded to Neutral from Buy at Sterne Agee
Raymond James (RJF) downgraded to Market Perform from Outperform at Wells Fargo
VF Corp. (VFC) downgraded to Market Perform from Outperform at Wells Fargo
WellCare (WCG) downgraded to Neutral from Buy at Goldman

Initiations

Aetna (AET) reinstated with a Buy at Goldman
BioScrip (BIOS) initiated with a Buy at Jefferies
Cray (CRAY) initiated with a Buy at Sterne Agee
Harris (HRS) initiated with a Hold at Stifel
Hasbro (HAS) initiated with an Overweight at Piper Jaffray
JAKKS Pacific (JAKK) initiated with a Neutral at Piper Jaffray
LeapFrog (LF) initiated with an Overweight at Piper Jaffray
Mattel (MAT) initiated with an Overweight at Piper Jaffray
Sony (SNE) initiated with a Buy at Jefferies
Summer Infant (SUMR) initiated with an Overweight at Piper Jaffray
Taylor Morrison (TMHC) initiated with a Hold at Deutsche Bank

HOT STOCKS

Dish (DISH), Sprint (S) to engage in talks
Softbank (SFTBF) confirmed waiver, expects Sprint (S) deal to close in six weeks
Cadbury Schweppes (CSG) begins modified $125M “Dutch Auction” tender offer
Apple (AAPL) has used Ireland as a tax-haven for the past five years by creating “No-shore” tax entities, said Senator Carl Levin (D-MI)
S&P lowered Dell (DELL) ratings to ‘BBB’ from ‘A-’, remains on watch negative
Carnival (CCL, CUK) lowered FY13 EPS to $1.45-$1.65 from $1.80-$2.10, consensus $1.97
General Cable (BGC) initiated dividend and extended $125M repurchase authorization
DOJ reached settlement with Cinemark (CNK) in Rave Holdings deal
Wausau Paper (WPP) agreed to divest specialty paper business for about $110M
Regeneron (REGN), Bayer (BAYRY), Genentech (RHHBY) resolved certain patent disputes

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
hhgregg (HGG), TiVo (TIVO), Urban Outfitters (URBN)

NEWSPAPERS/WEBSITES

  • JPMorgan Chase (JPM) plans to shake-up of its board even if every director wins re-election at today’s shareholder meeting and James Dimon keeps his dual job as chairman and CEO, the Wall Street Journal reports
  • Mutual-fund firms are joining activist investors in getting more aggressive over demands for change in how board members are paid at U.S. companies. Activist investors have been experimenting more frequently with incentive pay packages for the board members they nominate in proxy fights, the Wall Street Journal reports
  • Specialty chemicals producer Rockwood Holdings’s (ROC) pigments businesses have attracted offers from buyout firms including Blackstone Group (BX) and Advent International, sources say, Reuters reports
  • The Asian prime brokerage unit of Credit Suisse (CS) replaced Morgan Stanley (MS) as the second largest firm servicing the region’s $148B hedge funds industry, according to a survey by AsiaHedge. Goldman Sachs (GS) remains Asia’s top prime broker with 179 clients and total assets under management of $24.6B, Reuters reports
  • Bank managers in the U.S. are less likely to engage in mergers and acquisitions this year as regulators heighten scrutiny on potential deals and sellers wait for higher valuations, according to a KPMG survey, Bloomberg reports
  • PIMCO’s Bill Gross says the bull market for bonds may have ended last month. But investors are staying put. Four years into the biggest rally in U.S. stocks since 2000, bond mutual funds are attracting more money than their equity counterparts, Bloomberg reports

SYNDICATE

Cimatron (CIMT) files to sell ordinary shares
First Potomac (FPO) files to sell 6M shares of common stock
Ironwood (IRWD) files to sell 10.5M shares of common stock
Laclede Group (LG) files to sell 8.7M shares of common stock
NPS Pharmaceuticals (NPSP) files to sell 6M shares of common stock
Oaktree Capital (OAK) files to sell 6M shares of common stock
TCP Capital (TCPC) files to sell 4M shares of common stock
Wesco Aircraft (WAIR) files to sell 15M shares of common stock