(BFW) Big Question for Brazil Mkts Post-Cup Concerns Protests: SocGen

Big Question for Brazil Mkts Post-Cup Concerns Protests: SocGen
2014-07-09 03:19:55.621 GMT


By Grant Clark
     July 9 (Bloomberg) -- In very short term, SocGen sees
smaller impact of “humiliating” World Cup defeat on Brazilian
asset prices than some anticipate, strategist Eamon Aghdasi
writes in e-mailed note.
  * Bad news is investors will shift back to reality of economic
    woes; good news is there could be “more buzz” regarding
    Rousseff’s political vulnerability, possibility for new
    economic stewardship next year
  * Bigger question is whether protests akin to a year ago
    return in weeks ahead after tournament provided respite from
    smoldering civil frustrations
  * An adverse scenario is turbulent protests and Rousseff’s
    popularity staying intact, “an unfortunate combination of
    structural worries and diminished hope for new policies”
  * Political trends in terms of demonstrations, electoral polls
    take on somewhat greater significance
  * SocGen remains cautious in general; recommends Pre-DI 16s17s
    steepeners and holding a bias to sell BRLMXN
  * Recommendations in part motivated by concern that any
    disturbance in current low volatility, relatively stable
    U.S. rates market environment could shake investors’
    appetite for yield, willingness to overlook Brazilian
    economic realities
  * Related story: Why UBS Says Brazil’s 7-1 Trouncing Is
    Bearish for Stock Market


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

To contact the reporter on this story:
Grant Clark in Singapore at +65-6212-1101 or
gclark@bloomberg.net
To contact the editors responsible for this story:
Jan Dahinten at +65-6212-1164 or
jdahinten@bloomberg.net

(BFW) Liberum Says Funds Managers See Pickup in M&A, Lists Targets

Liberum Says Funds Managers See Pickup in M&A, Lists Targets
2014-07-09 05:38:59.225 GMT


By Gaurav Panchal
     July 9 (Bloomberg) -- Liberum says 85% of fund managers it
surveyed in July expect material pickup in small and mid cap.
companies being taken over in next 12 months.
  * Says 95% of CFOs are expecting M&A levels to increase over
    next 6 months, cites Deloitte, DataStream
  * Says confidence is rising, interest rates are low, organic
    growth remains scarce
  * M&A in U.K. indices has remained stubbornly subdued, just 1%
    of FTSE 250 market cap was taken out in 2013 vs. a mid cycle
    average of 4%: Liberum
  * Lists most likely targets: Asos, AstraZeneca, Balfour
    Beatty, Bovis Homes, Costain, CSR, HaloSource, Hyder, ITV,
    Johnson Matthey, Jupiter Fund Management, Mothercare, New
    Britain Palm Oil, Spectris, Syngenta, Tarsus, UBM

Link to Company News:{ASC LN <Equity> CN <GO>}
Link to Company News:{AZN LN <Equity> CN <GO>}
Link to Company News:{BBY LN <Equity> CN <GO>}
Link to Company News:{BVS LN <Equity> CN <GO>}
Link to Company News:{COST LN <Equity> CN <GO>}
Link to Company News:{CSR LN <Equity> CN <GO>}
Link to Company News:{HAL LN <Equity> CN <GO>}
Link to Company News:{HYC LN <Equity> CN <GO>}
Link to Company News:{ITV LN <Equity> CN <GO>}
Link to Company News:{JMAT LN <Equity> CN <GO>}
Link to Company News:{JUP LN <Equity> CN <GO>}
Link to Company News:{MTC LN <Equity> CN <GO>}
Link to Company News:{NBPO LN <Equity> CN <GO>}
Link to Company News:{SXS LN <Equity> CN <GO>}
Link to Company News:{TRS LN <Equity> CN <GO>}
Link to Company News:{UBM LN <Equity> CN <GO>}

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

To contact the editor responsible for this story:
Gaurav Panchal at +44-20-7392-0511 or
gpanchal2@bloomberg.net

>>> BAT rumoured to be closing in on Reynolds American buyout at USD 75 per shar

BAT rumoured to be closing in on Reynolds American buyout at USD 75 per share or more 

British American Tobacco (BAT) is increasingly rumoured to be poised to buy out its NYSE-listed competitor Reynolds American, The Daily Mail reported. The market report said BAT's London-quoted stock has dropped to 3555.5p, down 19.5p, in anticipation of a multi-billion-pound spend to acquire the 58% Reynolds American stake it does not yet have.

Rumours yesterday suggested BAT might be prepared to pay more than USD 75 per share to take its current 42% stake to full ownership, the item reported. It noted that Reynolds American shares were trading at USD 61.40 early yesterday, 8 July.

A standstill arrangement prevents BATS from bidding at the moment but will expire in three weeks, leaving BATS free to move, the report said. It added that a BAT acquisition of Reynolds American would scupper any hopes the Winston Salem, North Carolina-based tobacco group might have of buying its rival Lorillard - a transaction which rumours have suggested might be worth more than USD 20bn.


Source Daily Mail

>>> Asian Update

Asian Market Update: Asian stocks down on US markets; China Jun inflation eased; Alcoa beats forecasts to kickoff start of earnings Wed, 09 Jul 2014 0:06 AM EST

***Notable Economic Data*** - (CN) CHINA JUN CPI Y/Y: 2.3% V 2.4%E - (CN) CHINA JUN PPI Y/Y: -1.1% V -1.0%E (28th month of decline; smallest decline in 8 months) - (AU) AUSTRALIA JUL WESTPAC CONSUMER CONFERENCE INDEX: 94.9 V 93.2 PRIOR; M/M: 1.9% V 0.2% PRIOR - (KR) SOUTH KOREA MAY MONEY SUPPLY L M/M: 1.2% V 0.5% PRIOR; M2 M/M: 0.5% V 0.4% PRIOR - (KR) SOUTH KOREA JUN BANK LENDING TO HOUSEHOLD (KRW): 488.9T V 485.3T PRIOR (record high) - (JP) JAPAN JUN MONEY STOCK M2 Y/Y: 3.0% V 3.0%E; M3 Y/Y: 2.4% V 2.5%E - (NZ) NEW ZEALAND JUN RETAIL CARD SPENDING M/M: 0.0% V 0.2%E; TOTAL CARD SPENDING M/M: 0.5% V +1.8% PRIOR - (UK) UK JUN BRC SHOP PRICE INDEX Y/Y: -1.8% V -1.4% PRIOR (14th month of decline) - (US) API PETROLEUM INVENTORIES: CRUDE: -1.7M v -2Me, GASOLINE: +0.1M v -0.5Me, DISTILLATE:-0.5M v +1.5Me

***Index Snapshot (as of 02:30 GMT)*** - Nikkei225 -0.4%, S&P/ASX -1.0%, Kospi -0.5%, Shanghai Composite -0.2%, Hang Seng -1.3%, Sept S&P500 flat at 1,961

***Commodities/Fixed Income/Currencies*** Aug gold +0.3% at $1,320, Aug crude oil flat at $103.39/brl, Sept copper -0.1% at $3.25/lb - (CN) PBoC sets yuan mid-point at 6.1565 v 6.1626 prior (strongest yuan setting since Jul 1st) - (CN) PBoC gauges demand for 14-day reverse repos, 14-day and 28-day repos as well as 91-day bill sales - (JP) BOJ offers to buy ¥110B in JGB with maturity lower than 1-yr, ¥400B in 5-10yr JGB - (CN) China Ministry of Finance (MOF) sells 1-yr bonds, avg yield 3.54% v 4.04% in Jan - US financial press - (AU) Australia MoF (AOFM) sells A$700M in 2.75% bonds due 2024; Avg yield: 3.5370%; Bid-to-cover: 3.1x

***Market Focal Points/Key Themes*** - The Asian bourses fell once again as Wall Street continued to selloff on concerns of overvaluation while Chinese inflation eased to 2.3% down from the prior month's reading of 2.5%. The June inflation data was less than the expected 2.4% and well short of the 3.5% percent annual target set by the government.

- Also out of China, US Treasurer Lew and Sec Kerry attended the 6th round of US-China Strategic and Economic Dialogue where both nations addressed the importance for a bilateral relationship. The US continued to urge exchange rate reform. However, expectations are seen to be modest as there is little hope for progress on key areas such as territorial concerns and cyber issues.

- The consumer sentiment in Australia continued to recover, but remained weaker than average as the Westpac Confidence Index rose 1.9% to 94.9. Westpac's chief economist Bill Evans said, 'This is another disappointing result for the Index. We had expected a stronger bounce back in the Index following its 7% tumble in the aftermath of the Commonwealth Budget in May.'

***Equities*** US markets: - AA: Reports Q2 $0.18 v $0.13e, R$5.84B v $5.63Be; +1.1% afterhours - IP: Board approves $1.5B buyback program (7% of market cap); flat afterhours - SIMG: Lowers rev guidance; Q2 R$58.5-60.5M v $73.5Me (prior R$71-76M); -13.8% afterhours

Notable movers by sector: - Consumer Discretionary: Tian Ge Interactive 1980.HK +5.5% (IPO starts trading); Navitas NVT.AU -31.9% (extends partnership) - Financials: GF Securities 000776.CN +0.2% (H1 guidance) - Materials: Jiangxi Wannianqing Cement 000789.CN +2.1% (H1 guidance); Northern Star Resources NST.AU +8.3% (Jun gold production results) - Industrials: Qingdao TGOOD Electric 300001.CN +10.0% (H1 guidance); Hangzhou Xingyuan Filter Technology 300266.CN +3.5% (awarded order) - Technology: Tencent Holdings 700.HK -2.8% (tech companies listed in US traded lower earlier today); Netposa Technologies 300367.CN +6.8% (H1 guidance)

Samsung Severely Undervalued With Cash 35% of Mkt Cap: Bernstein

+------------------------------------------------------------------------------+

Samsung Severely Undervalued With Cash 35% of Mkt Cap: Bernstein 2014-07-08 22:16:57.961 GMT

By Sarah Gill July 9 (Bloomberg) -- Samsung best positioned for long term; common and pref shrs remain undervalued: Bernstein analyst Mark Newman in a note. * Memory business likely to account for increasing part of oper. profit going fwd * Most important stk driver is going to be what it does with cash, ongoing restructure of Samsung Group; both may give upside to shrs, timing unclear * Cash may be used for buybacks and/or divs. * Est. Samsung shipped 75m smartphone units in 2Q, down 20% q/q, flat y/y * Rates Samsung outperform * 2m won PT implies ~25% discount to sum of the parts value, is based on 9x 2015 est. P/E * Samsung 48 buys, 5 holds, 1 sell, avg. PT 1,663,659 won: Bloomberg data * Samsung shrs down 5.6% YTD vs KOSPI Index -0.2%, KOSPI Electrical and Electronic Equip Index +1.5%

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

To contact the reporter on this story: Sarah Gill in sydney at +61-2-9777-8641 or sgill23@bloomberg.net To contact the editor responsible for this story: Jan Dahinten at +65-6212-1164 or jdahinten@bloomberg.net

>>> US After Hours

After Hours Summary: AVAV +5.5%, AA +1.1%, GIMO -28.8%, TCS -16.0%, SIMG -12.0%, BOBE -2.4% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: AVAV +5.5%, AA +1.1%

Companies trading higher in after hours in reaction to news: LJPC +2.7% (announced planned initiation of Phase 3 registration program for LJPC-501 in resistant hypotension; application for orphan drug designation filed), C +0.9% (CNBC reporting that co is near a multi billion dollar settlement with the U.S. government over mortgages)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: GIMO -28.8%, TCS -16.0%, SIMG -12.0%, BOBE -2.4%

Companies trading lower in after hours in reaction to news: SLXP -2.8% (to combine with Cosmo Technologies; upon completion of the merger, shareholders of Salix are expected to own slightly less than 80% of the ordinary shares of the new company), RTK -1.3% (filed for ~45.05 mln share common stock offering by selling shareholders), CLUB -0.8% (disclosed an amendment to property sale agreement to permit Purchaser additional time to complete its financing) 

WSJ : Belgium Calls on BNP to Share Lessons Learned from $9 Billion Fine

Belgium Calls on BNP to Share Lessons Learned from $9 Billion Fine
Finance Minister Asks Bank CEO to Explain His Plans

BNP Paribas's headquarters in Paris. The bank has agreed to pay out nearly $9 billion for violating U.S. sanctions against Sudan, Iran and Cuba. Associated Press
BRUSSELS— BNP Paribas SA BNP.FR -2.13% 's largest single shareholder, the Belgian government, has summoned the French bank's chief executive to seek an explanation about the U.S. sanctions case and its $9 billion penalties.

Belgium's Finance Minister Koen Geens expressed concern about the gravity of the charges against BNP Paribas and has asked the bank's CEO, Jean-Laurent Bonnafé, to come and meet him soon in Brussels, according to a statement issued by the ministry on Tuesday.

Mr. Geens "wishes to get a precise understanding of what lessons management and all the responsible parties will learn from what has happened, including matters regarding shareholder transparency," the ministry said.

BNP Paribas, France's largest listed bank by assets, last month pleaded guilty to violating U.S. sanctions against Sudan, Iran and Cuba, as part of an unprecedented settlement that included a year-long ban on the bank's ability to conduct certain U.S. dollar transactions.


BNP Paribas Chief Executive Jean-Laurent Bonnafé delivering a speech during the bank's 2012 results conference in Paris on Feb. 14, 2013. Associated Press
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A spokeswoman for BNP Paribas declined to comment.

The Belgian government's request highlights the pressure on the French bank and its management to explain how it plans to turn the page on what Mr. Bonnafé himself has described as a "difficult situation." The settlement with U.S. authorities has marked an abrupt fall from grace for a bank, which until now had largely dodged the scandals that gave the industry a bad name, such as the U.S. mortgage crisis or the Libor interest-rate rigging.

The country ended up with a stake in the French lender in 2009 when BNP Paribas bought Belgian bank Fortis, 532843.BY +1.38% which had been bailed out by the Belgian government.

The Belgian government has said it wasn't intent on holding on to its 10.3% interest in the bank. "However, a decision to sell this type of holding needs to be taken in a calm atmosphere by a government with a full mandate," said Mr. Geens.

Belgium's current six-party coalition government is in a caretaker role; preliminary talks to form a new government have been continuing since elections in late May.

In the settlement on June 30, U.S. officials laid out in stark terms a sophisticated and long-running scheme BNP Paribas relied on to disguise billions of dollars in financial transactions in violation of American sanctions—despite warnings by some within the firm about the legality, and morality, of the transactions.

In Sudan, the bank acknowledged using regional banks overseas to process more than $20 billion in financial transactions linked to local companies and government agencies at a time when the nation was engaged in what the U.S. and others call genocide.

Mr. Bonnafé expressed "deep regrets" for the French bank's misconduct shortly after U.S. authorities announced the settlement. "The failures that have come to light in the course of this investigation run contrary to the principles on which BNP Paribas has always sought to operate," Mr. Bonnafé said.

The bank said it would set up a special unit in New York to ensure BNP Paribas complies globally with U.S. sanctions. Its New York branch will be responsible for processing and controlling all of the bank's dollar flows in the future.

>>> US Close Dow-0,69% S&P -0,70% Nasdaq -1,35%

Closing Summary: High-Growth Names Weigh on Equity Indices Again
The major averages registered their second consecutive decline that sent the S&P 500 lower by 0.7% with nine sectors ending in the red. Like yesterday, small-cap stocks underperformed with the Russell 2000 and Nasdaq Composite posting respective losses of 1.2% and 1.4%.

In some ways, today's session resembled yesterday's affair as stocks began the trading day on a cautious note amid weakness in European equities. Yesterday, a disappointing Industrial Production report from Germany contributed to the cautious posture, while today's losses followed the largest monthly decline in UK's Industrial Production (-0.7%) since January 2013.

With participants receiving another warning sign about the strength of economic growth in the eurozone, the stage was set for another day of profit taking.

The technology sector resisted some of the selling pressure yesterday, but the top-weighted S&P 500 sector lost 1.0% today. The influential sector suffered from losses among components of all sizes, including a 0.6% drop in the shares of Apple (AAPL 95.32, -0.62) after the top-weighted tech stock spiked 2.1% on Monday.

Social media names slumped notably with the likes of Facebook (FB 62.76, -2.53), LinkedIn (LNKD 158.67, -10.58), and Twitter (TWTR 37.41, -2.82) posting losses between 3.9% and 7.0%.

Things looked a bit better among chipmakers as the PHLX Semiconductor Index trimmed its loss to 0.5% after being down as much as 1.0% at the halfway point of the session. Similarly, biotechnology also inched up off its midday low, but the iShares Nasdaq Biotechnology ETF (IBB 253.63, -5.46) still lost 2.1%, which weighed on the health care sector (-0.9%).

On the upside, the utilities sector (+0.6%), which struggled last week, spent the entire session in the green to boost its week-to-date gain to 1.0%.

Utilities notwithstanding, consumer staples (-0.2%), energy (-0.2%), and materials (-0.3%) settled ahead of the broader market, but could not climb into the green. In the materials space, Alcoa (AA 14.85, +0.11) bucked the trend, adding 0.6% ahead of its after-hours earnings report.

Today's weakness in equities translated into strength for the bond market, sending the 10-yr note higher by 15 ticks. For its part, the benchmark yield fell five basis points to 2.56%.

Participation was a bit below average with just under 670 million shares changing hands at the NYSE.

Economic data was limited to the Jobs Openings and Labor Turnover Survey and the Consumer Credit report:
The Job Openings and Labor Turnover Survey for May indicated job openings increased to 4.635 million from 4.464 million
Consumer credit increased by $19.60 billion in May after increasing a downwardly revised $26.10 billion (from $21.80 billion) in April. The consensus expected consumer credit to increase by $16.10 billion
Consumer credit typically goes through large monthly revisions, but any future revision is unlikely to alter the current trend of double-digit credit growth

Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET, while the minutes from the June FOMC meeting will cross the wires at 14:00 ET.


S&P 500 +6.2% YTD
Nasdaq Composite +5.1% YTD
Dow Jones Industrial Average +2.0% YTD
Russell 2000 +0.7% YTD

>>> AA : Reports Q2 $0.18 v $0.13e, R$5.84B v $5.63Be

Reports Q2 $0.18 v $0.13e, R$5.84B v $5.63Be 
- Affirms FY14 global aluminum demand growth +7% (prior +7%) Outlook: Global aluminum demand growth forecast of 7 percent in 2014 reaffirmed; global aluminum deficit increasing; global alumina surplus shrinking Segments: 
- Alumina after tax operating income $38M v $64M y/y 
- Primary metals after-tax operating income $97M v -$32M y/y 
- Global rolled products after-tax operating income $79M v $79M y/y 
- Engineered products and solutions after-tax operating income $204M v $193M y/y 
- Adj EBITDA margin 13.3% v 10.5% y/y 
- CEO: We are taking the downstream business to new profitability heights, capturing midstream demand as auto lightweighting accelerates, while continuing to relentlessly improve upstream performance. Our strategy of building a lightweight multi-material innovation powerhouse and a highly competitive commodities business is driving compelling and sustainable shareholder value.