>>> US Early premarket gappers

Early premarket gappers
Gapping up: TKMR +34.9%, LOCO +3.9%, HSBC +3.1%, DHI +2.9%, INFY +2.8%, TSEM +2.8%, ANIP +2.4%, EVR +1.7%, X +1.1%, GSK +1%, GPRO +1%, AAPL +0.8%, LOGI +0.8%, HLF +0.6%, SNY +0.5%

Gapping down: ZGNX -7%, ARMH -2.2%, TWTR -1.2%, CCL -1.2%, UBS -1%, CVX -0.9%, GOLD -0.9%, JPM -0.8%, JPM -0.8%, RIG -0.6%, DB -0.6%, MCD -0.3%

(BFW) *BANCO ESPIRITO SANTO SUBORDINATED CDS QUOTED AT 500 BPS: CMA

BFW 08/04 09:54 *BANCO ESPIRITO SANTO SUB CDS QUOTED AT 24% UPFRONT LAST WEEK
BN 08/04 09:53 *BANCO ESPIRITO SANTO SUB CDS QUOTED AT 24% UPFRONT LAST WEEK
BN 08/04 09:53 *BANCO ESPIRITO SANTO SUBORDINATED CDS QUOTED AT 500 BPS: CMA
*BANCO ESPIRITO SANTO SUBORDINATED CDS QUOTED AT 500 BPS: CMA
2014-08-04 09:54:24.204 GMT

--BRIAN SWINT

-0- Aug/04/2014 09:54 GMT

>>> BES PL - Banco Espírito Santo has been split into “good” and “bad” banks as

BES PL - Banco Espírito Santo has been split into “good” and “bad” banks as part of a €4.9bn rescue of the distressed Portuguese lender that protects taxpayers and senior creditors but leaves shareholders and junior bondholders holding only toxic assets. The rescue, which will destroy much of the value of investments made by equity and subordinated debt holders, is seen as a test case for a tougher stance by EU regulators, who have promised to protect taxpayers from the cost of bailing out mismanaged banks.

>>> PostNL Reports Q2 Op Underlying cash €60M v €23M y/y, Rev €1.02B v €1.0Be

PostNL Reports Q2 Op Underlying cash €60M v €23M y/y, Rev €1.02B v €1.0Be

- Reaffirms FY14 underlying cash op income €260-290M (prior €260-290M from July 7th) 
- Reaffirms FY15 targets 

- Parcels volume: +8.2% y/y 
- Netherlands mail volue -11.2% y/y 
- Underlying cash operating margin 6.7% v 2.3% y/y 

- CEO: "In the second quarter the strong performance of Mail in the Netherlands was further supported by price increases, mix effects and some incidentals. "International saw revenue growth, but some challenges remain: in Germany and in the United Kingdom we are awaiting regulatory ruling for fair competition. Parcels performed as expected, based on volume growth on the back of a growing e-commerce market and moderate growth in the business market. We focus on innovation to consolidate our leading position. Extra services that we started were amongst others evening delivery. In the quarter, Parcels saw its subcontractor costs increase and, due to a change in customer mix, the average price slightly decline. "Overall, the first half year was strong and reflects the learning curve we experienced in restructuring the company and the supportive and cooperative mindset of all our employees to adapt to the changing environment. All this fuels my confidence that we will achieve our 2015 targets."

(BFW) Draghi Says Communication is Core Element of Central Bank Policy

BFW 08/04 06:06 *DRAGHI SAYS MONETARY POLICY COMMUNICATION IS CONSTANT CHALLENGE
BFW 08/04 06:02 *ECB PRESIDENT DRAGHI COMMENTS IN HANDELSBLATT OPINION ARTICLE
BFW 08/04 06:02 *DRAGHI SAYS COMMUNICATION CORE ELEMENT OF CENTRAL BANK POLICY
Draghi Says Communication is Core Element of Central Bank Policy
2014-08-04 06:17:17.685 GMT


By Jeff Black
Aug. 4 (Bloomberg) -- European Central Bank President Mario
Draghi says in guest article in Handelsblatt that move to
publish account of ECB minutes from next year will help to
explain policy.
* “At the moment we are working on trial runs to find the
right format. Ultimately, we want to make these summaries
comprehensible for the interested general public. Only that
way can they have their full impact”
* “Central bank communication these days is a core element of
monetary policy, and in fact it is itself a monetary policy
instrument”
* NOTE: Draghi Says ECB to Change Frequency of Monetary Policy
Meetings {NSN N84ZEJ6K50Y3<Go>}


Link to Company News:{2539Z GR <Equity> CN <GO>}

For Related News and Information:
First Word scrolling panel: {FIRST<GO>}
First Word newswire: {NH BFW<GO>}

To contact the reporter on this story:
Jeff Black in Frankfurt at +49-69-92041-205 or
jblack25@bloomberg.net

To contact the editor responsible for this story:
Christoph Rauwald at +49-69-9204-1146 or
crauwald@bloomberg.net

>>> Asian Update

Asian Market Update: Portugal bails out BES; China non-manufacturing PMI slows

***Economic Data*** - (CN) CHINA JULY NON-MANUFACTURING PMI: 54.2 V 55.0 PRIOR (6-month low; 2nd consecutive decline) - (AU) AUSTRALIA JUN RETAIL SALES M/M: 0.6% (5-month high) V 0.3%E; Q2 RETAIL SALES EX INFLATION Q/Q: -0.2% V -0.5%E - (AU) AUSTRALIA JUL TD SECURITIES INFLATION M/M: 0.2% V 0.0% PRIOR; Y/Y: 2.6% V 3.0% PRIOR - (AU) AUSTRALIA JUL ANZ JOB ADS M/M: 0.3% V 4.4% PRIOR - (NZ) NEW ZEALAND JUL ANZ COMMODITY PRICE M/M: -2.4% (5th consecutive decline) V -0.9% PRIOR

***Index Snapshot (as of 02:30 GMT)*** - Nikkei225 flat, S&P/ASX -1.4%, Kospi -0.1%, Shanghai Composite 0.8%, Hang Seng +0.4%, Sept S&P500 +0.4% at 1,925

***Commodities/Fixed Income/Currencies*** - Dec gold -0.1% at $1,294, Sept crude oil flat at $97.89/brl, Sept Copper flat at $3.22/lb - (JP) BOJ offers to buy ¥300B in 1-3yr JGB, ¥200B in 3-5yr JGB, ¥100B in 10-25yr JGB and ¥30B in JGB with maturity over 25-yr - (KR) South Korea sells KRW800B in 30-yr bonds; Avg yield: 3.360% - (KR) South Korea sells KRW1.745T in 3-yr Bonds; avg yield: 3.525%; bid-to-cover: 4.28x - USD/CNY: (CN) PBoC sets yuan mid point at 6.1661 v 6.1681 prior setting (first firmer setting 4 sessions)

***Market Focal Points/Key Themes*** - Sentiment in Asia is mixed, reflecting lukewarm response to a somewhat disappointing employment data in the US on Friday and conflicting developments around the world over the weekend. Currency market volatility also remains limited, as USD pared its recent post-GDP/Fed gains after the miss on the jobs figures. EUR/USD traded just above $1.3440, USD/JPY was up about 10pips above ¥102.60, and AUD/USD hit a high of $0.9330 after retail sales from Australia.

- China non-manufacturing PMI slowed for the 2nd consecutive month, hitting a 6-month low of 54.2. Most notably, employment and new export orders subindices fell into contraction while new orders were essentially flat. Also out of China, State Information Center think tank offered its projections for the 2nd half of the year, forecasting GDP at 7.4% v 7.4% in H1, CPI at 2.5% v 2.3% in H1, exports up 7.5% v 0.9% in H1, and industrial output at 8.9% v 8.8% in H1. The center also noted the property market would continue to decline, echoing the latest from China Index Academy which reported July residential property prices falling for the 3rd consecutive month.

- In other key economic data, Australia put out better than expected retail sales for June but much slower growth in job advertisements for July. RBA policy statement during tomorrow's session is not expected to differ materially from last month, with persistent AUD strength and subpar growth likely remaining on the agenda.

- In Europe, Banco Espirito Santo was granted a EUR4.9B bailout by the Portuguese central bank. Authorities will withdraw BES from trading, setting up a good bank and a bad bank meant to reassure depositors and protect senior bondholders while inflicting the most pain on shareholders and subordinated creditors. The 'good' bank (called Novo Banco) is expected to hold the firm's deposit-taking assets, and its core tier 1 ratio would be above the minimum requirement. In Germany, the IFO warned Q2 GDP would shrink toward zero due to Ukraine crisis and sanctions on Russia, down from 0.8% in Q1 and 0.3% prior Q2 forecast. Vice Chancellor Gabriel acknowledged the new economic sanctions against Russia will hurt Germany's economy, but they are necessary for the sake of peace in Europe.

- Russian economy is also bending under sanctions - the latest data from the Energy Ministry showed some sequential declines in energy production. Russian Foreign Ministry has formally accused EU of withdrawing a ban on supplying Ukraine with military technology and equipment. Pro-Russian separatists also reportedly renewed their calls for Russia to send troops to their aid as Ukraine army surrounds the rebel stronghold of Donetsk. Some reports did indicate there was more Russian military presence on Ukraine border.

- Israel has met with growing condemnation from UK, EU, and even US officials after another bombardment of a UN shelter in Gaza resulting in civilian casualties. PM Netanyahu announced another humanitarian ceasefire (deemed unilateral by Hamas) and also indicated that the military will reduce some of its presence in Gaza, as IDF is already nearing completion of tunnel destruction. Netanyahu was quick to point out the military offensive was not being suspended entirely.

***Equities*** US markets: - GSK: Private equity groups said to be considering a $10B plan to purchase older drug brands from GSK and Sanofi and merge them - FT - JPM: Said to have reached proposed $4.5B MBS settlement deal for most trusts - financial press - BRK.B: Reports Q2 Net EPS attributable to shareholders (Class A shares) $3,889 v $2,763 y/y; Rev $49.8B v $44.7B - filing - EVR: To acquire ISI Group and remaining 40% interest in Evercore's institutional equities business - ANIP: Acquires Vancocin Capsules and Additional Vancomycin Assets from Shire; sees immediate accretion

Notable movers by sector: - Consumer Discretionary: Kikkoman Corp 2801.JP -1.8% (Q1 results); Treasury Wine Estates TWE.AU +4.4% (confirms revised bid from KKR) - Financials: China Everbright Bank 601818.CN +4.9%, Everbright Securities 601788.CN +1.7% (Everbright Group to restructure) - Materials: Atlas Iron AGO.AU +1.9% (production plan update) - Energy: Roc Oil ROC.AU +7.1% (receives bid from Fosun); Anton Oilfield Services Group 3337.HK -5.2% (H1 guidance) - Industrials: AVIC Aircraft 000768.CN +4.1%, Xi'An Aero-Engine 600893.CN +1.7%, China Spacesat 600118.CN +0.9% (Japan govt names 158 remote islets); Gem-Year Industrial 601002.CN +9.2% (private placement plan); Fuji Heavy Industries 7270.JP +1.5% (Subaru US sales results); Ibiden 4062.JP +2.5% (Q1 results); Otsuka Corp 7004.JP -2.9% (Q1 results) - Technology: Beijing VRV Software Corp 300352.CN +1.6% (many android phone attacked by mobile virus in China); Rohm 6963.JP +6.3% (Q1 results); Otsuka Corp 4768.JP -4.2% (H1 results) - Healthcare: Guilin Layn Natural Ingredients 002166.CN +6.9%, Shandong Lukang Pharma 600789.CN +10.1% (Ebola getting more attention)

>>> What to look at this week end.


Keep an eye on :
- ARM LN : ARM Sees Chance of Royalties on $60bn Worth of Chips: Times
- BES PL : BES Will Be Recapitalized With State Aid, SIC Reports
- CBK GY : German Banks Are Targets for Southern Peers, RHJ Tells Spiegel
- DAI GY : Daimler to Cut Some Auto-Parts Prices in China by Average 15%
- DBK GY : Deutsche Bank May Seek Damages From Breuer in Kirch Case: Welt
- DBK GY : German Banks Are Targets for Southern Peers, RHJ Tells Spiegel
- DLG GY : Dialog Semiconductor interested in small technology companies, large buys possible (translated)
- GSK LN : Private Equity Firms Weighing $10b Drug Brands Purchase: FT
- HSBA LN : HSBC Asks Govt, BOE for Delay to Bank Ring-Fencing Changes: Sky
- ILD FP : T-Mobile execs deem Niel offer serious, amid regulatory concerns about Sprint proposal
- LHA GY : Lufthansa Says ISIS-Controlled Space to Be Avoided
- NOBN SW : Nobel Biocare Holder Ronner ‘Not Involved’ in Takeover Talks:FuW
- NOVN VX : Novartis Chairman Sees Risk From Swiss Immigration Vote: Blick
- SAN FP : Private Equity Firms Weighing $10b Drug Brands Purchase: FT
- SAN FP : France May End Pharmacy Monopoly on Selling Some Drugs, JDD Says
- SY1 GY : Symrise Ready for More Buys Next Year, CFO Tells Boersenzeitung
- TEF SM : Telefonica May Have Hired Banks for GVT Bid, Repubblica Reports
- TIT IM : Telecom Italia Renegotiates Revolving Credit Lines, Sole Says
- UNA NA : Unilever CEO Foresees Unavoidable Job Cuts: WirtschaftsWoche
- VONN SW : Vontobel CEO Says Acquisition Must Have CHF10b-CHF20b AuM: FuW
- VIV FP : Telefonica May Have Hired Banks for GVT Bid, Repubblica Reports