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Thursday, March 28, 2024

Frontrunning: December 10

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

  • New Normal headlines: Global stocks up on hopes of China policy easing (Reuters)
  • China inflation eases to five-year low (BBC)
  • U.S. Lawmakers Agree on $1.1 Trillion Spending Bill (WSJ)
  • U.S. Braced for Blowback as CIA Report Lays Bare Abuses (BBG)
  • CIA tortured, misled, U.S. report finds, drawing calls for action (Reuters)
  • CIA Made False Claims Torture Prevented Heathrow Attacks (BBG)
  • Oil Resumes Drop as Iran Sees $40 If There’s OPEC Discord (BBG)
  • OPEC Says 2015 Demand for Its Crude Will Be Weakest in 12 Years (BBG)
  • Greek yield curve inverted as politics raise default fears (Reuters)
  • Bentleys Woo China to London as Russians Pack for Home (BBG)
  • New Leak Shows Scope of Luxembourg Corporate-Tax Deals (WSJ)
  • Man charged with trying to take U.S. military documents to China (Reuters)
  • China’s Former Energy Chief Gets Life in Jail for Bribery (BBG)
  • Ukraine needs expanded IMF programme (Reuters)
  • Why Texas Is Now Home to Bargain-Hunting Japan Oil Buyers (BBG)
  • Optimism Waning at Japan Inc. (WSJ)
  • Phibro to Shut Down U.S. Business (WSJ)
  • Burt Malkiel: Walk Away from 2015 Know-It-Alls (BBG)

 

Overnight Media Digest

WSJ

* House and Senate lawmakers reached an agreement on a nearly $1.1 trillion bill to fund most of the government through September and avert a shutdown, aides said. (http://on.wsj.com/135p0MD)

* The Keystone XL pipeline was touted as a model for energy independence and a source of jobs when TransCanada Corp announced plans to build the 1,700-mile pipeline six years ago. But the crude-oil pipeline’s political and regulatory snarls since then have emboldened resistance to at least 10 other pipeline projects across North America. (http://on.wsj.com/1wbG4Lw)

* The Securities and Exchange Commission told policy-research firm Marwood Group that it intends to recommend bringing civil charges against the company, in what would be the first action against the policy-research business since Congress sought to rein in the flow of market-moving information from Washington to Wall Street. (http://on.wsj.com/12LdCnL)

* The Navy is testing a new laser it is developing by using it on targets such as drones and small boats in the Persian Gulf. Top Navy leaders say the laser could become a critical defense on a future generation of warships and offers great potential as a precise and economical weapon. A single shot from the laser could bring down a drone or blow up the engine of a small boat, officials said. (http://on.wsj.com/1sbqhwS)

* State Department investigators discovered numerous security deficiencies in global hot spots when reviewing U.S. diplomatic facilities in 2012 and 2013, suggesting problems were more widespread than previously known. Inspections of five newly opened compounds in 2012 found failings that included deviations from security standards, along with design, construction and maintenance flaws. (http://on.wsj.com/1Ads0Al)

* U.S. prosecutors are investigating employees of Standard Chartered PLC and may file criminal charges against some individuals as officials examine whether the bank violated the terms of a 2012 settlement over transactions involving Iran and other countries, according to people familiar with the matter. (http://on.wsj.com/1B5wdr1)

 

FT

* Hungary granted a Russian state owned company energy contracts worth 6 billion euros ($7.43 billion) , a deal which critics say will make Hungary dependent on Russia for decades.

* Michael Bloomberg replaced Matt Winkler, the founding editor at his news service, with Economist Editor-in-chief John Micklethwait. Matt was responsible for creating the Bloomberg news service for the group 25 years ago.

* German carmaker BMW and rival Volkswagen announced surprise changes to top management on Tuesday, with the veteran CEO of BMW Norbert Reithofer stepping down a year early.

* Tesco slashed its profit forecasts for the fourth time in six months as its new boss Dave Lewis took charge of the former retail powerhouse which has seen its share price halve in the last year.

 

NYT

* DreamWorks Animation said on Tuesday that it would introduce a television network in 19 Asian territories, including South Korea, Taiwan and Hong Kong. (http://nyti.ms/1AdwTtl)

* Citigroup Inc gave investors a taste of its fourth-quarter results on Tuesday, detailing an expected $2.7 billion legal charge related to multiple investigations facing the bank. (http://nyti.ms/1sbhiM1)

* The board overseeing a $7 billion nationwide public-safety communications network paid “no systematic attention to potential conflicts of interest” among its members, several of whom have financial ties to the telecommunications industry, according to a report released on Tuesday by the Commerce Department’s inspector general. Members of the board of FirstNet, as the network is known, did not file timely public financial disclosure reports, the report said. (http://nyti.ms/1yxIypG)

* The Federal Reserve, fearing complacency six years after the financial crisis, moved on Tuesday to preserve the efforts that have strengthened large banks. The Fed proposed a rule that would increase capital requirements for the nation’s eight largest banks, including JPMorgan Chase & Co and Goldman Sachs Group Inc. (http://nyti.ms/1wZsUTD)

* North Dakota regulators on Tuesday ordered producers pumping oil from the Bakken shale field to begin removing flammable natural gas liquids from their product before shipment in an effort to prevent deadly explosions involving trains. (http://nyti.ms/1sbuT6d)

 

China

CHINA SECURITIES JOURNAL

– China’s stock market is still a bull market and short-term sharp fluctuations do not signal an end to the upward trend and should allow investors an opportunity to re-arrange their position, the newspaper said in a front page commentary.

– The China Insurance Regulatory Commission (CIRC) will encourage large insurance companies and private funds to set up professional health insurance companies, said Xiang Junbo, chairman of the CIRC.

SECURITIES TIMES

– China’s regulators have asked brokerages to check the impact of Tuesday’s 5 percent slump in the stock market on their business operations and to send up a report with their views on near-term stock market movements.

SHANGHAI DAILY

– A pilot scheme set to be introduced this month will allow both domestic and foreign law firms operating in Shanghai’s free trade zone to provide cross-border legal services. In the past, companies were required to employ both a Chinese and foreign law firm to conduct such businesses as foreign lawyers are prohibited from directly participating in China’s legal affairs.

CHINA DAILY

– Chinese aquaculture farmers are demanding compensation of more than 141 million yuan ($22.80 million) against oil firms ConocoPhillips and CNOOC Ltd. for their “losses and suffering” following an oil spill in June 2011 at the Penglai oilfield. ConocoPhillips has a 49 percent stake in the field, which is 51 percent owned by CNOOC, China’s top offshore oil and gas firm.

 

Britain

The Times

SUPREME COURT LEAVES BP STUCK IN OIL SPILL

BP has lost in its latest attempt to cap its liabilities over the Gulf of Mexico oil spill. The U.S. Supreme Court threw out its legal challenge against a multibillion-dollar compensation scheme yesterday. (http://thetim.es/1ufeBmU)

BRITAIN BRACED FOR WEATHER BOMB BLITZ

Winds reaching 80 mile per hour were predicted last night as forecasters warned that Scotland, Northern Ireland and parts of northern England and Wales can expect severe gales until tomorrow. The rapid cyclogenesis known as a “weather bomb” is a deep low pressure system moving slowly eastwards between Scotland and Iceland. (http://thetim.es/1wwgFyd)

The Guardian

NEW SCOTLAND YARD IS BOUGHT FOR 370 MILLION POUNDS BY DEVELOPER

Possibly the world’s most famous police headquarters, New Scotland Yard in London, has been sold for 370 million pounds ($580 million) to a Middle East investor who plans to replace the 1960s block with luxury apartments. (http://bit.ly/1zquYDu)

PORTUGUESE BRICKLAYERS PAID 1,000 POUNDS A WEEK DUE TO SHORTAGE OF UK WORKERS

Building firms are having to hire bricklayers from Portugal, paying them 1,000 pounds a week, because of a shortage of workers from the UK. One in three large construction firms in London are having to turn down bidding opportunities because of a shortage of skilled workers, said the employment group Manpower. (http://bit.ly/1wb12ZK)

The Telegraph

BG TO SELL AUSTRALIA GAS PIPELINE FOR $5 BILLION

BG Group Plc has sold a gas project in Australia for $5 billion , as the UK-listed energy giant focuses on exploration amid falling profits. The British company has offloaded a liquefied natural gas pipeline in Queensland to APA Group. (http://bit.ly/1vLUZMt)

PETROL TO DROP TO 1 POUND A LITRE, SAYS GOLDMAN SACHS

Kevin Daly, senior economist at Goldman Sachs, said the falling oil price would boost consumer confidence even as wage growth remains weak and uncertainty clouds the global growth outlook. (http://bit.ly/1waZT5O)

Sky News

TOP EXECUTIVES QUIT WOODFORD FUNDS VENTURE

Two of Woodford Investment Management’s executives Nick Hamilton, chief operating officer and Gray Smith, the chief legal and compliance officer who were instrumental in backing Neil Woodford have quit his asset management start-up less than a year after its launch. (http://bit.ly/1wcEFmB)

TESCO REFUSES EXECUTIVES APPEAL OVER SACKING

A number of senior managers who left Tesco after profits were overstated by 263 million pounds ($412.12 million) have been told by the retailer that they have no right to appeal over their departures. (http://bit.ly/1wuOwHL)

The Independent

MANCHESTER UNITED SHARES: EDWARD GLAZER PUTS THREE MILLION SHARES IN OLD TRAFFORD CLUB UP FOR SALE

Edward Glazer, one of Malcolm Glazer’s six children, has put three million shares in Manchester United Plc up for sale, little more than six months after his father’s death, and stands to recoup in the region of $45 million. (http://ind.pn/1BxiP1Z)

UKIP GENERAL SECRETARY SUSPENDED OVER SEX HARASSMENT CLAIM BY HIGH-PROFILE CANDIDATE NATASHA BOLTER

UK Independence Party has been plunged into a fresh crisis after one of its most high-profile female candidates quit the party over sex harassment claims against its general secretary. Natasha Bolter, an Oxford-educated former Labour party activist, claims that she was propositioned by the party’s general secretary Roger Bird on the day she was interviewed as a prospective candidate. (http://ind.pn/164lQK5)

 

 

Fly on The Wall Pre-Market Buzz

ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
Treasury budget statement for November at 14:00–consensus deficit $63.0B

ANALYST RESEARCH

Upgrades

American Airlines (AAL) upgraded to Overweight from Equal Weight at Barclays
American Eagle (AEO) upgraded to Outperform from Market Perform at BMO Capital
BP (BP) upgraded to Buy from Hold at Deutsche Bank
Bemis (BMS) upgraded to Outperform from Market Perform at BMO Capital
Bio-Techne (TECH) upgraded to Buy from Neutral at Janney Capital
Burger King (BKW) upgraded to Outperform from Sector Perform at RBC Capital
EV Energy (EVEP) upgraded to Buy from Hold at Stifel
Genesco (GCO) upgraded to Neutral from Sell at Goldman
Sunesis (SNSS) upgraded to Buy from Hold at Cantor
United Continental (UAL) upgraded to Overweight from Underweight at Barclays

Downgrades

Allegiant Travel (ALGT) downgraded to Underweight from Overweight at Barclays
Brinker (EAT) downgraded to Hold from Buy at Miller Tabak
Cascade Microtech (CSCD) downgraded to Neutral from Buy at B. Riley
Disney (DIS) downgraded to Hold from Buy at Topeka
Goldman Sachs (GS) downgraded to Neutral from Positive at Susquehanna
M&T Bank (MTB) downgraded to Underperform from Market Perform at Raymond James
PetroChina (PTR) downgraded to Hold from Buy at Jefferies
Pinnacle West (PNW) downgraded to Neutral from Buy at SunTrust
Royal Dutch Shell (RDS.A) downgraded to Hold from Buy at Deutsche Bank
Steven Madden (SHOO) downgraded to Neutral from Buy at Goldman
Webster Financial (WBS) downgraded to Hold from Buy at Evercore ISI

Initiations

3D Systems (DDD) initiated with an Underperform at Longbow
AutoZone (AZO) initiated with a Buy at Nomura
C.H. Robinson (CHRW) initiated with a Neutral at Nomura
CSX (CSX) initiated with a Buy at Nomura
CVS Health (CVS) initiated with a Neutral at Citigroup
Canadian National (CNI) initiated with a Neutral at Nomura
Carrizo Oil & Gas (CRZO) initiated with a Buy at Canaccord
CenterPoint Energy (CNP) initiated with a Neutral at Nomura
Con-way (CNW) initiated with a Neutral at Nomura
Cornerstone OnDemand (CSOD) initiated with a Buy at BofA/Merrill
Depomed (DEPO) initiated with an Outperform at RBC Capital
Dollar General (DG) initiated with a Buy at Citigroup
Dollar Tree (DLTR) initiated with a Neutral at Citigroup
EMC (EMC) initiated with a Neutral at JPMorgan
Expeditors (EXPD) initiated with a Neutral at Nomura
Genesee & Wyoming (GWR) initiated with a Neutral at Nomura
Hudbay Minerals (HBM) initiated with an Overweight at Barclays
J.B. Hunt (JBHT) initiated with a Buy at Nomura
Kroger (KR) initiated with a Buy at Citigroup
Lundin Mining (LUNMF) initiated with an Overweight at Barclays
NetApp (NTAP) initiated with a Neutral at JPMorgan
Norfolk Southern (NSC) initiated with a Neutral at Nomura
Qlik Technologies (QLIK)initiated with a Buy at BofA/Merrill
Rentokil (RTOKY) initiated with a Neutral at UBS
ServiceNow (NOW) initiated with a Buy at BofA/Merrill
Stratasys (SSYS) initiated with a Neutral at Longbow
Suburban Propane (SPH) initiated with a Hold at Stifel
Tableau (DATA) initiated with a Buy at BofA/Merrill
Union Pacific (UNP) initiated with a Buy at Nomura
Viper Energy (VNOM) initiated with a Buy at Stifel
Walgreen (WAG) initiated with a Buy at Citigroup
Werner (WERN) initiated with a Neutral at Nomura

COMPANY NEWS

BP (BP) sees $1B in group-wide restructuring charges over coming year
BG Group (BRGYY) agreed to sale of Australian pipeline for $5B
Yum! Brands (YUM) CEO said ‘firmly committed to double-digit EPS growth in 2015’
Broadcom (BRCM) increased dividend to 14c, authorized $1B stock repurchase plan
Korn/Ferry (KFY) increased share repurchase plan to $150M
AMD (AMD) announced that it is transferring its stock exchange listing to The Nasdaq (NDAQ) Stock Market from The New York Stock Exchange (ICE), effective after market close on December 31

EARNINGS
Companies that beat consensus earnings expectations last night and today include:
Costco (COST), NCI Building Systems (NCS), Analogic (ALOG), HealthEquity (HQY), Korn/Ferry (KFY), CHC Group (HELI)

Companies that missed consensus earnings expectations include:
Toll Brothers (TOL), Mitcham Industries (MIND), Krispy Kreme (KKD), Freshpet (FRPT), Streamline Health (STRM)

Yum! Brands (YUM) sees FY14 mid-single-digit adjusted EPS growth, consensus $3.24
Yum! Brands (YUM) sees FY15 EPS growth at least 10%, consensus $3.78
Korn/Ferry (KFY) sees Q3 EPS 43c-49, consensus 46c
Broadcom (BRCM) raises Q4 revenue view to $2.075B-$2.15B, consensus $2.09B

NEWSPAPERS/WEBSITES
JPMorgan (JPM) faces $22B capital hole under new Fed rules, Financial Times reports
Bose products to return to Apple (AAPL) stores, 9to5Mac reports
HBO (TWX) plans to launch web-only service in April, Fortune reports
HBO (TWX) CTO Berkes to exit cable network, Variety reports
HSBC (HSBC) fires London-based head of currencies trading, WSJ reports
Apple (AAPL) to establish R&D center in Japan, Nikkei reports 
Abercrombie & Fitch (ANF) still not a ‘buy,’ Barron’s says

SYNDICATE
Agios Pharmaceuticals (AGIO) files to sell $175M of common stock
Brixmor (BRX) files to sell 5.6M shares for holders
Cross Country Healthcare (CCRN) files to sell 3.52M shares for holders
Gramercy Property Trust (GPT) files to sell 45M shares of common stock
Kite Pharma (KITE) files to sell 3M shares of common stock

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