>>> Chateau de Pommard sold to Michael Baum

Chateau de Pommard sold to Michael Baum -

Michael Baum, a US businessman working in the Silicon Valley, has acquired Chateau de Pommard, the French privately-owned winery located in the Burgundy region, from owner Maurice Giraud, French daily Le Figaro reported. The unsourced report said that Chateau de Pommard, which generates annual revenues of EUR 6m, was acquired in 2003 by Giraud, who is now 73 years old.


Source Le Figaro

>>> Asian Update

Asian Market Update: China property prices continue to fall; Greenback stays bid after FOMC

***Economic Data***
- (CN) CHINA AUG NEW HOME PRICES M/M: PRICES RISE IN 1 OF 70 CITIES V 2 PRIOR; Y/Y: PRICES RISE IN 48 OF 70 CITIES V 65 PRIOR; all-70 new home prices m/m: -1.1% v -1.2% prior; y/y: 0.5% v 2.5% prior
- (JP) JAPAN AUG MERCHANDISE TRADE BALANCE: -¥948.5B V -¥1.03TE; ADJ TRADE BALANCE: -¥924.2B (lowest deficit in 3 months) V -¥985.2BE
- (NZ) NEW ZEALAND Q2 GDP Q/Q: 0.7% (1-year low) V 0.6%E; Y/Y: 3.9% V 3.8%E

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 +1.1%, S&P/ASX -0.3%, Kospi -0.7%, Shanghai Composite +0.2%, Hang Seng -0.6%, Dec S&P500 flat at 1,994

***Commodities/Fixed Income/Currencies***
- Dec gold -1.0% at $1,223/oz, Oct crude oil -0.6% at $93.90/brl, Dec copper -0.2% at $3.13/lb
- SLV: iShares Silver Trust ETF daily holdings rise to 10,589 tonnes from 10,559 tonnes prior (highest since Oct 2013)
- (CN) PBoC to drain CNY10B in 14-day repos (16th consecutive drain); Injects net CNY8B this week v drained CNY5B in prior week
- (JP) BOJ offers to buy ¥400B in 5-10yr JGB, ¥100B in 10-25yr JGB, and ¥30B in JGB with maturity over 25-yr
- JGB: (JP) BOJ Apr-Jun flow of funds report: Japan GPIF, other public pension funds sold net ¥1.1T in long-term govt in Apr-Jun - financial press
- USD/CNY: (CN) PBoC sets yuan mid point at 6.1490 v 6.1450 prior setting (weakest setting since Sept 8th)

***Market Focal Points/Key Themes***
- USD/JPY hit new 6 year highs above ¥108.70, EUR/USD fell to 14-month lows below $1.2840, and AUD/USD hit 6-month lows below $0.8940 in the wake of mixed FOMC statement / updated projections / Yellen press conference. The Fed retained "considerable time" and "underutilization of labor" catch-phrases, but the hawkishly-predisposed Fisher joined Plosser's dissent. Staff projections lowered 2014 and 2015 GDP forecasts, but new median rate forecasts for 2017 and the long term (blue dots) stretched out to mid-4pct. Moreover, expectations for first rate hike in 2015 were reported by 14 members (12 prior), while those of first hike in 2016 are now 2 vs 3 prior. Finally, Fed chair Yellen in her press conference said its not fair to call Fed's forward guidance as calendar-based, and that the Fed will move sooner if it sees the need to do so, presumably conveying more data dependence. Tracking firmer USD, spot gold hit an 8-month lows below $1,225/oz.

- China property sector figures took another turn for the worse. Aug new home prices m/m declined in 68 cities (record high) of 70 vs 64 prior. M/M decline of -1.1% was also 4th consecutive decline, while y/y growth slowed sharply to just 0.5% from 2.5% prior. Also of note out of China, PBoC offered yield in its CNY10B open market operations was set at 3.5% - down from 3.7% and widely interpreted as another sign of an easing bias. Shanghai Composite reversed its initial slide to trade higher by 0.5% once the repo rate offer yield was announced.

- New Zealand Q2 GDP came in at a 1-year low of 0.7%, albeit slightly better than expected. Among the notable components, private consumption expenditure rose 1.2% v 0.1% prior, but exports slumped by -2.9% after rising 2.8%. NZD/USD traded off the lows on the release, rising about 30pips above $0.8110.

- Japan trade deficit was not as severe as feared, coming in at a 3-month lows, with exports down -1.3% v -2.6% expected. Shipments to the US are down 4.4% despite the weak JPY and exports to China fell 0.2% after rising 2.3%, but exports to Europe remained positive at +5.6%.

- Ahead of tomorrow's vote, Scotland referendum polls are still narrowly favoring the NO camp. YouGov poll on Scotland independence referendum stayed at 48% Yes / 52% No forecast. According to Survation poll, the NO vote (including undecided) moved up by 1pt to 53%.

***Equities***
US markets:
- HNSN: Study finds Sensei Robotic System associated with statistically significant improved success rates compared with manual persistent AF Ablation; +13.9% afterhours
- UNFI: Reports Q4 $0.67 v $0.65e, R$1.76B v $1.74Be; +3.1% afterhours
- STLD: Guides Q3 $0.42-0.46 (ex acquisition) v $0.37e; +2.6% afterhours
- FEYE: Signs agreement with Mandiant to Deliver Industry's First Global Security as a Service Solution; +0.1% afterhours
- PIR: Reports Q2 $0.10 v $0.13e, R$418.6M v $427Me; -10.0% afterhours
- FLXN: Announces Clinical Hold of FX006 Phase 2b Clinical Trial in Osteoarthritis of the Knee; -22.6% afterhours

Notable movers by sector:
- Consumer Discretionary: Oroton ORL.AU +7.1% (FY14 results)
- Materials: Arrium Ltd ARI.AU -35.9% (capital raise); Jiaozuo Wanfang Aluminum Manufacturing 000612.CN -4.2% (aluminum futures lower)
- Energy: AWE Ltd AWE.AU +13.7% (shareholder raises stake)
- Industrials: Kubota Corp 6326.JP ++3.7% (analyst action)
- Technology: Asahi Glass 5201.JP +1.5% (press speculation on Op profit); Sony Corp 6758.JP -9.8% (cuts guidance, halts dividend)
- Healthcare: Guangdong Taiantang Pharmaceutical 002433.CN +1.1% (acquires medical e-commerce business)
- Utilities: Korea Electric Power Corp 015760.KR +5.1% (sells HQ site)

(MergerMarket) United Technologies hunting 'large scale M&A' though good targets

United Technologies hunting 'large scale M&A' though good targets scarce

United Technologies (NYSE:UTX) is looking for larger acquisitions but sees a dearth of good opportunities, according to CFO Greg Hayes.

During the Q&A session of the Morgan Stanley Laguna conference on Tuesday (16 September), Hayes was asked how he saw the current M&A pipeline.

"Not terribly robust ... We continue to look for opportunities to do large scale M&A. And I make that large scale comment specifically because, at USD 65bn, you've got to do bigger deals to move the needle," he replied.

Hayes noted that the company would continue to do smallish deals on the technology front and on the Otis portfolio side.

"But really the target here is, where can we help move the needle to help us in these two core markets that we operate in on the commercial aerospace side and commercial buildings?" he said.

Hayes explained that for a USD 15bn Aerospace Systems business, it was tougher to do deals, and there were not many engine companies for sale. While he added that there were more opportunities on the commercial side, valuation was an issue because of rising equity prices.

In the face of high multiples, cost synergies were key, Hayes noted.

"We want to find deals where we can generate real hard cost synergies like we did with Goodrich. When you can create value through cost synergies, you can afford to pay some of these multiples that are out there," he said. "USD 500m of synergies on Goodrich creates 5bn of value to the shareowners. We want to find more deals like that, probably not at 18bn, but bigger deals. But I would tell you right now, there's not much in the pipeline of that ilk."

Earlier in the session, as part of a longer reply to a question about share buybacks, the CFO noted the difficulty in bringing back cash from overseas and said the company had over USD 5bn of "trapped foreign cash."

During the first half of 2014, United Technologies spent USD 84m on a number of small acquisitions, primarily in its commercial businesses.

United Technologies has five main business segments: Otis; UTC Climate, Controls & Security; Pratt & Whitney; UTC Aerospace Systems; and Sikorsky. The company refers to Otis and Climate, Controls & Security as its "commercial businesses," while Pratt & Whitney, UTC Aerospace Systems and Sikorsky are the aerospace businesses.

In September 2013, the company formed UTC Building and Industrial Systems, a new organizational structure consisting of Otis and Climate, Controls & Security. Those two businesses continue to report their financial results as separate segments.

The CFO's remarks at this week's conference mostly echoed those from previous months. On the 1Q14 earnings call in April, as this news service reported at the time, Hayes said he did not expect to make any large buys this year but would continue to look.

While United Technologies has used various advisors in recent years for both acquisitions and disposals, Goldman Sachs and Deutsche Bank have been used more than once for sizeable transactions since 2010. For legal, Wachtell, Linklaters, and Cleary Gottlieb have advised on multiple deals during the past few years, according to the Mergermarket M&A database.

Hartford, Connecticut-based United Technologies has a market capitalization of USD 99bn.

>>> US Close Dow +0,15% S&P +0,13% Nasdaq +0,21% Russel +0,26%

Closing Market Summary: Dollar Jumps Following FOMC Directive

The major averages ended the midweek session with slim gains after showing some intraday volatility in reaction to the release of the latest policy directive from the Federal Open Market Committee. The S&P 500 added 0.1%, while the relative strength among small caps sent the Russell 2000 higher by 0.3%.

Equities spent the first half of the session near their flat lines as participants stuck to the sidelines ahead of the FOMC statement, which conveyed no changes to the Fed's current policy course. The indices surged after the statement crossed the wires, but returned near their flat lines by the close.

As expected, the Fed reduced the monthly pace of its asset purchases by $10 billion to $15 billion, setting expectations for the program to be wound down at the next meeting. Furthermore, the Fed maintained the "considerable time" language in its forward guidance, suggesting the first rate hike remains somewhat distant. On that note, the economic projections that were also released indicated the Fed sees the fed funds rate at 1.375% at the end of 2015.

The policy statement weighed on Treasuries (10-yr yield +3 bps to 2.62%), while giving a boost to the greenback. The Dollar Index (+0.6%) climbed to its best level since last June at the expense of other major currencies. Notably, the dollar/yen pair soared from the 107.15 area to 108.30.

Seven of ten sectors posted gains with materials (+0.6%) ending in the lead. The growth-sensitive sector was underpinned by steelmakers after U.S. Steel (X 45.61, +4.20) boosted its guidance. The Market Vectors Steel ETF (SLX 49.20, +0.43) advanced 0.9%.

Meanwhile, the other commodity-linked sector—energy (-0.5%)—ended at the bottom of the leaderboard following its recent outperformance. The sector narrowed its week-to-date gain to 1.4% and was pressured by a 0.6% decline in the price of crude oil ($94.33/bbl).

Elsewhere, the remaining cyclical sectors ended on a mixed note. Financials (+0.4%), industrials (+0.4%), and technology (+0.2%) displayed relative strength, while consumer discretionary (unch) ended a bit behind the broader market.

The industrial sector outperformed from the start with better than expected earnings from FedEx (FDX 159.71, +5.05) providing support. Shares of FDX jumped 3.3%, while the broader Dow Jones Transportation Average gained 1.0%. Airlines bucked the trend, which was a bit surprising considering the decline in the price of crude. Delta Air Lines (DAL 38.94, -0.58) and JetBlue Airways (JBLU 11.20, -0.21) lost 1.5% and 1.9%, respectively.

Also of note, the discretionary sector finished just behind the market, but that masked the strength among homebuilders. The industry group rallied in reaction to better than expected results from Lennar (LEN 41.40, +2.27). The stock surged 5.8%, while the iShares Dow Jones US Home Construction ETF (ITB 24.13, +0.54) settled higher by 2.3%.

Today's participation was ahead of recent averages with more than 650 million shares changing hands at the NYSE.

Economic data included CPI, NAHB Housing Market Index, Q2 Current Account Balance, and the weekly MBA Mortgage Index:
  • The CPI report for August revealed a 0.2% decline, while the consensus expected an unchanged reading 
    • This was the first decline in total CPI since April 2013, driven by a 2.6% decline in the energy index 
  • Core CPI, meanwhile, was flat against a 0.2% uptick expected by the consensus 
  • The NAHB Housing Market Index for September rose to 59 from 55, while the consensus expected an increase to 56 
  • The current account deficit for the second quarter totaled $98.50 billion while the consensus expected the deficit to hit $114.50 billion 
    • The first quarter deficit was revised to $102.10 billion from $111.20 billion 
  • The weekly MBA Mortgage Index jumped 7.9% to follow last week's 7.2% drop 
Tomorrow, weekly Initial Claims (consensus 305K) and August Housing Starts (consensus 1045K)/Building Permits (expected 1054K) will be released at 8:30 ET, while the Philadelphia Fed survey for September (consensus 23.5) will cross the wires at 10:00 ET.
  • Nasdaq Composite +9.2% YTD 
  • S&P 500 +8.3% YTD 
  • Dow Jones Industrial Average +3.5% YTD 
  • Russell 2000 -0.8% YTD

(MergerMarket) Apple’s smartwatch foray may start the clock on more M&A, sources

Apple’s smartwatch foray may start the clock on more M&A, sources say 

The unveiling of Apple’s (NASDAQ: AAPL) smartwatch lends credibility to the fledgling category and it is likely to spur increased consolidation of wrist wearables, according to industry sources.

“It shows the entire consumer world that these emerging categories are real – not a flash in the pan,” said Jef Holove, general manager of Basis, a fitness and wellness band that Intel (NASDAQ: INTC) acquired for approximately USD 100m in March. Basis launched its next-generation smartwatch the same week as Apple.

Further consolidation of wrist wearables is considered likely as Apple and other large original equipment manufacturers (OEMs) such as Samsung (KRX: 005930), Motorola (NYSE: MSI) and LG Electronics (KRX: 066570) accrue a bigger share of the market, the industry sources said. Google (NASDAQ: GOOG), Amazon (NASDAQ: AMZN) or Microsoft (NASDAQ: MSFT) don’t yet have offerings of their own and consequently could be pushed into making an acquisition, noted Myriam Joire, product evangelist for Palo Alto, California smartwatch pioneer Pebble. Pebble could draw interest from Amazon and Microsoft, while Garmin (NASDAQ: GRMN), known for its global positioning system (GPS) navigation products, has a line of wearable fitness trackers whose niche athlete following could attract Google, she said.

With a wave of new smartwatches hitting the market this year, startups such as FitBit and Jawbone could feel pressure as newer products do what fitness bands can do plus a whole lot more, Joire said.

“The smartwatch is doing to the fitness band what the smartphone did to the Flip camera,” she said, referring to the digital video camera division that Cisco shuttered in 2011 two years after acquiring it.

Price erosion could force fitness bands into obsolescence in two or three years, Joire predicted.

A strategic partnership between Pebble and MisFit, a maker of wearable wellness and medical bands, is indicative of where product evolution is going, she said. Misfit’s specialized algorithms and user interface are being integrated into Pebble’s watch, she said, although some features available on MisFit’s Shine fitness band, such as sleep tracking, won’t be rolled out on Pebble until later. MisFit also appears committed to its own wearable devices, as evidenced by this week’s debut of a USD 50 fitness band called MisFit Flash, which sells for half the price of Shine.

Indeed, the fleeting battery life found in the majority of smartwatch lines and their higher price point leave room for both fitness bands and smartwatches – at least for the foreseeable future, the industry sources agreed. While Pebble boasts a week-long battery life in its USD 150 starter model, Apple’s least expensive smartwatch will retail for USD 349 and its battery will require a nightly charge.

“Just because Apple gets in a category doesn’t mean everyone else is going to die,” said Adam Jackson, CEO of Doctor On Demand, a healthcare IT company partnering with Apple. “It’s still early in the game for wearables.”

Fitness bands and smartphones “will borrow aspects of each other” over time, added Holove at Basis. Garmin’s new “vivosmart” is an example of this type of hybrid, as it includes Bluetooth-linked smartphone notifications, a hidden OLED screen, and several sensors for fitness tracking and alerts.

Still, there is a long way for wearables to go before winners and losers can be declared, the industry sources agreed. Google’s smartwatch platform, Android Wear, only opened up to OEMs on 18 March and while there is plenty of hype around Apple’s new watch lines, they won’t come to market until 2015. Plus, it remains to be seen if mainstream consumers beyond the tech cognoscenti in Silicon Valley will buy any of the wrist wearables, the sources said.

Between 2012 and 2013, the global smartwatch industry grew tenfold, reaching a market volume of USD 700m, according to a trade group. By the end of this year, the industry is projected to hit USD 2.5bn.

>>> Fed Chair Yellen: The 'considerable time' statement remains appropriate, the

Fed Chair Yellen: The 'considerable time' statement remains appropriate, the committee remains comfortable with it, is highly conditional on economic data - Q&A 
- There has been little change in the overall economic assestment since the June meeting
- Reiterates there is no mechanical interpretation of what 'considerable time' means, reiterates interpretation will be data dependent
- Not fair to describe Fed's forward guidance as being calendar based
- Projected path of labor market is only partly dependent on the growth outlook
- There is relatively little upward movement in the interest rate path
- Slow pace of wage increases reflects slack in the labor market
- The recovery has been slower over the past five years than prior recoveries
- It is not clear that there is a gap between market expectations of future rates and Fed expectations

>>> Fed watcher Hilsenrath (WSJ): In addition to retaining "considerable time" l

Fed watcher Hilsenrath (WSJ): In addition to retaining "considerable time" language, Fed unveiled new details how it would manage mechanics of interest rate rise when its time arrives 
- Says the "exit strategy" introduces new instruments that will help the Fed move short-term rates once officials decide the economy can manage tighter credit.
- By laying out exit strategy, Fed took new steps toward winding down easy policy.
- Fed avoided the more dramatic step of signalling when rates would start to go up because economy is not yet sufficiently strong.
- Fed's growth projections through 2016 were all marked down.-
Growth projections through 2017 also shows Fed is less convinced economy can sustain 3% growth rates.

>>> Fed watcher Hilsenrath (WSJ): In addition to retaining "considerable time" l

Fed watcher Hilsenrath (WSJ): In addition to retaining "considerable time" language, Fed unveiled new details how it would manage mechanics of interest rate rise when its time arrives 
- Says the "exit strategy" introduces new instruments that will help the Fed move short-term rates once officials decide the economy can manage tighter credit.
- By laying out exit strategy, Fed took new steps toward winding down easy policy.
- Fed avoided the more dramatic step of signalling when rates would start to go up because economy is not yet sufficiently strong.