>>> Asian Update

Asian Market Update: Samsung Electronics Q1 profit boosted by chip segment; China officially announces easing of property curbs

***Economic Data*** - (NZ) NEW ZEALAND MAR TRADE BALANCE (NZ$): 920M V 900ME (5th straight month of trade surplus) - (KR) SOUTH KOREA MAR CURRENT ACCOUNT BALANCE: $7.3B V $4.5B PRIOR; GOODS BALANCE: $8.0B V $5.4B PRIOR

Market Snapshot (as of 03:30 GMT): - Nikkei225 closed, S&P/ASX -0.6%, Kospi -0.2%, Shanghai Composite +0.2%, Hang Seng +0.5%, Jun S&P500 +0.2% at 1,869, Jun gold -0.3% at $1,295, Jun crude oil flat at $100.85/brl

***Highlights/Observations/Insights*** - Samsung Electronics posted its final Q1 results that were largely above consensus and company's preliminary estimates (Reports Q1 Final Net KRW7.5T v KRW6.8Te, Op profit KRW8.5T v KRW8.40T prelim, Rev KRW53.7T v KRW53.0T prelim), however shares are moderately lower. Analysts pointed to the decline in operating profits for the 2nd consecutive quarter as well as a flat projection for 2014 CAPEX, with subsequent reports indicating the expenditures had risen in 8 out of the past 10 years. Operating profit growth was the highest in the chip segment, rising to KRW1.95T v KRW1.07T y/y, while profits in TV and display segments fell. Broader Korea's Kospi is also down modestly despite the saber-rattling by the North. Pyongyang was reported to have established a launch firing area near western sea border, prompting Seoul to warn it would respond if artillery from the North fell into South territory

- Down Under, New Zealand posted its 5th consecutive month of trade surpluses. Exports were up 15% y/y, imports up 13%, and overall exports of dairy products up an impressive 45%, despite some large declines in prices as reported in the recent Fonterra Global Dairy Trade auctions. Australia is leading regional indices lower despite an upgrade in output projections from Oil Search and M&A activity with ROC-Horizon Oil merger of equals. Australia PM Abbott warned there is a need to address significant budget problems, suggesting the possibility of an increase in tax rates.

- China's Shanghai Composite has come off its overnight lows after falling to its worst levels in over a month. Official confirmation of easing property curbs in Guangxi Province - the first formal shift after weeks of press speculation - has helped to improve sentiment, despite a report of additional 22 pre-IPO disclosures received by the China Securities Regulatory Commission (CSRC). Separately, PBoC announced its 21st consecutive net drain - its single operation for the week ahead of the May 1st holiday period.

- Markets in Tokyo were closed in observance of Showa Day, as traders brace for tomorrow's BOJ policy statement, accompanying update on projections for growth/inflation, and a large set of corporate earnings announcements.

***Fixed Income/Commodities/Currencies*** - (AU) Australia MoF (AOFM) sells A$500M in indexed 2018 Bonds; avg yield: 0.9530%; bid-to-cover: 3.96x - (CN) PBoC to drain CNY50B in 28-day repos (21st consecutive drain); Injects net CNY91B this week v drained CNY2B prior - USD/CNY: (CN) PBoC sets yuan mid point at 6.1556 v 6.1565 prior setting (strongest setting since Apr 14th; 5th consecutive firmer setting)

***Equities*** US markets: - AMKR: Reports Q1 $0.09 v $0.01e, R$696M v $679Me; +6.1% afterhours - BWLD: Reports Q1 $1.49 v $1.35e, R$367.9M v $363Me; +5.3% afterhours - N: Guides FY14 $0.24-0.26 v $0.26e, R$540-545M v $540Me (prior $0.24-0.26, R$535-540M); Guides Q2 $0.02-0.03 v $0.04e, R$130-132M v $132Me; +2.0% afterhours - HIG: Reports Q1 $1.18 v $0.93e, R$2.86B v $2.81Be; +1.8% afterhours - HLF: Reports Q1 $1.50 v $1.30e, R$1.26B v $1.23Be; Terminates dividend in favor of stock buyback; Announces $216M (3.6% of market cap) increase in share repurchase program; -0.7% afterhours - UCTT: Reports Q1 $0.27 v $0.29e, R$144.2M v $138Me; -18.0% afterhours

Post Afterhours close: - JEC: Reports Q2 $0.63* v $0.89e, R$3.18B v $3.33Be - NOK: Announces €5B capital structure optimization program (including special dividend and buyback for €2.25B), to resume ordinary dividend at €0.11/share; Confirms new CEO

Notable movers by sector: - Consumer Discretionary: Bright Dairy & Food 600597.CN +4.7% (Q1 results) - Materials: Luoyang Glass 1108.HK +4.2% (Q1 results) - Energy: China Petroleum & Chemical Corp 386.HK -1.2% (Q1 results); Oil Search OSH.AU +1.0% (raises FY production guidance); Senex Energy SXY.AU -6.7% (Q3 production results) - Industrials: China Shipbuilding Industry Company 601989.CN -1.6% (FY13 results); First Tractor 38.HK -2.2% (Q1 results); Guangzhou Automobile Group 2238.HK +3.3% (Q1 results); Daewoo Engineering & Constr 047040.KR +6.4% (Q1 results) - Technology: Samsung Electronics 005930.KR -1.8% (Q1 final results); Gree Electric Appliances 000651.CN +3.6% (Q1 results)

>>> US Close Dow +0,53% S&P +0,32% Nasdaq-0,03%

Closing Market Summary: Stocks End Mixed as Momentum Names Weigh

The stock market began the new week on a mixed note despite showing early strength. Weakness among small-cap names resulted in the underperformance of the Russell 2000 (-0.6%) and the Nasdaq Composite (-0.03%), while the S&P 500 settled higher by 0.3%.

Equity indices climbed out of the gate, emboldened by M&A activity in the heavily-weighted health care sector (+0.6%). The third-largest group served as an early leader with help from Pfizer (PFE 32.04, +1.29), which jumped 4.2% after confirming its interest in AstraZeneca (AZN 77.01, +8.35). Also of note, Forest Laboratories (FRX 89.50, -0.34) agreed to acquire Furiex Pharmaceuticals (FURX 103.05, +22.90) for $1.1 billion.

Even though the health care sector rallied at the open, the broader market was unable to build on the strength as weakness in momentum names—including biotechnology—outweighed the early optimism. The iShares Nasdaq Biotechnology ETF (IBB 223.06, -0.90) spent the entire session between its 20- and 200-day moving averages before settling just above the 200-day average.

Elsewhere, other momentum names that have been volatile throughout April, remained unable to stage a rebound, which suggests the retreat in early April may not have fully run its course. For example, Amazon.com (AMZN 296.58, -7.25), Facebook (FB 56.14, -1.57), LinkedIn (LNKD 148.06, -10.11), and Yelp (YELP 55.55, -2.08) all lost between 2.4% and 6.4%. Interestingly, the losses in high-beta tech names did not scare investors away from large caps. Apple (AAPL 594.09, +22.15), IBM (IBM 193.14, +3.51), and Microsoft (MSFT 40.87, +0.96) advanced between 1.9% and 3.9%.

The relative strength of large cap issues was on display within the Dow Jones Industrial Average (+0.5%), which outperformed throughout the session as 22 of 30 components posted gains.

However, not all large caps displayed comparable strength as the financial sector (-0.6%) lagged throughout the session. Bank of America (BAC 14.95, -1.00) fell 6.3% after announcing an adjustment to its estimated regulatory capital ratios, which will require the bank to submit a new capital plan to the Fed. The stock ended near its session low, while the financial sector was able to reclaim the bulk of its losses during the afternoon as equity indices rallied off their lows.

Treasuries spent the entire session in the red, ending near their lows. The 10-yr note lost ten ticks, pushing its yield up to 2.70%.

Participation was above average as 804 million shares changed hands at the NYSE floor.

Economic data was limited to the Pending Home Sales report for March, which increased 3.4% while the consensus expected an increase of 1.0%. Today's reading followed last month's revised decrease of 0.5% (from -0.8%).

Tomorrow, the Case-Shiller 20-city Index (consensus +13.0%) will be released at 9:00 ET, while the Consumer Confidence survey for April (consensus 83.6) will be reported at 10:00 ET.

* S&P 500 +1.1% YTD  * Dow Jones Industrial Average -0.8% YTD  * Nasdaq Composite -2.5% YTD  * Russell 2000 -3.8% YTD

RTR - Allergan eyes new takeover bid for Shire

(Reuters) - Allergan Inc (AGN.N), facing an unsolicited bid from Valeant Pharmaceuticals International Inc (VRTX.O), is preparing to approach Shire Plc (SHP.L) again about a potential takeover after being rebuffed in recent months, people familiar with the matter said on Monday.

Allergan, the maker of Botox with a market capitalization of nearly $50 billion, is trying to stay independent. It held talks in recent months with Shire about a potential takeover that did not pan out, Reuters reported last week.

The U.S. dermatology drugmaker, which has since received a $47 billion takeover offer from Valeant teamed up with activist investor Bill Ackman, is still interested in a tie-up with Shire and planning a fresh approach to the $32 billion Irish drugmaker, said the people familiar with the matter.

Allergan could come back for a bid as soon as in the next few days, one person added. The plan has yet to be finalized and could change, cautioned the people, who asked not to be named because the matter is not public.

A representative of Allergan declined to comment, while Shire could not be immediately reached for comment.

A combination of Allergan and Shire would create a pharmaceutical giant with a combined market value of nearly $72 billion and annual sales of more than $11 billion.

Buying Shire would also help Allergan in its defense against Valeant, and Allergan could use Dublin-based Shire as a vehicle for a tax inversion deal that would lower its tax rate.

Shire had rebuffed Allergan's deal overture earlier this year, people familiar with the matter told Reuters last week, and it is not clear if the drugmaker would be open to entering into merger discussions.

In a process known as inversion, U.S. drugmakers seek to relocate their headquarters to other countries with lower tax rates. These companies are eying potential targets that are based in Ireland in particular because of a low 12.5 percent corporate tax rate, compared to 35 percent in the United States.

Generic drugmaker Mylan Inc (MYL.O) is also looking at acquisition targets that are based outside of the United States because of competitive pressures from rivals with a less burdensome tax structure, and it has made an unsuccessful bid for Swedish drugmaker Meda

RTR - Siemens offer for Alstom likely on Tuesday

(Reuters) - Germany's Siemens is due to present its offer for a possible deal with French peer Alstom on Tuesday, according to a source familiar with the matter.

"The Siemens' offer should be confirmed tomorrow during the day," the source said.

He added that the French state believed that Alstom should take the time necessary to examine all the offers on the table.

A spokesman for Siemens in Frankfurt did not confirm the information.

>>> Valeant Pharma shares ticking lower on AGN / SHPG headlines

Valeant Pharma shares ticking lower on AGN / SHPG headlines  

For some background: On Apr 22nd AGN confirmed that it has received an unsolicited proposal from Valeant Pharmaceuticals (VRX) to acquire all of the outstanding shares of the Company for a combination of 0.83 of Valeant common shares and $48.30 in cash per share of common stock of the Company.

RTR - Allergan approached Shire about takeover but rebuffed



(Reuters) - Allergan Inc approached Shire Plc in recent months about a possible takeover but was rebuffed, according to people familiar with the matter, in the latest example of a U.S. drugmaker seeking to buy an overseas rival to lower its tax rate.

The preliminary approach for Shire, which is based in Ireland and has a market value of $33 billion, did not progress to serious discussions between the two companies, the sources said.

Since then Allergan has received an unsolicited $47 billion takeover offer from Valeant Pharmaceuticals International Inc teamed up with activist investor Bill Ackman's Pershing Square Capital Management.

Analysts have suggested one way for the Botox maker to defend against the unsolicited bid would be to acquire foreign drugmakers such as Shire, Jazz Pharmaceuticals Plc or Alkermes Plc.

One of the sources said it was unclear if Allergan would try to revive talks with Shire, or pursue another target as a means to remain independent.

Representatives for Allergan and Shire declined to comment.

In a process known as inversion, U.S. drugmakers are looking to relocate their headquarters to other countries with lower tax rates. These companies are eying potential targets that are based in Ireland in particular because of a low 12.5 percent corporate tax rate, compared to 35 percent in the United States.

Recent deals that have been driven by tax advantages include generic drugmaker Actavis Plc's $8.5 billion acquisition of Dublin-based Warner Chilcott and Perrigo Company Plc's $8.6 billion acquisition of Elan.

Generic drugmaker Mylan Inc is also looking at acquisition targets that are based outside of the United States because of competitive pressures from rivals with a less burdensome tax structure, people familiar with the matter said.

Valeant's offer for Allergan comes amid a flurry of healthcare deals this week including medical device company Zimmer Holdings Inc's $13.4 billion acquisition of rival Biomet; a $20 billion asset swap between Novartis AG and GlaxoSmithKline Pharmaceuticals PLC; and Eli Lilly and Co's acquisition of Novartis' animal health business for $5.4 billion.

Those deals have driven healthcare M&A volumes to $153.3 billion so far this year, the highest year-to-date level since Thomson Reuters has started tracking data. Pharmaceutical deals have accounted for 71 percent of overall healthcare deals.

Valeant has been on a buying spree since 2010 and last year acquired contact lens maker Bausch & Lomb Holdings. Chief Executive Michael Pearson said in January the drugmaker wants to become one of the world's top five pharmaceutical companies by market capitalization by the end of 2016, largely through acquisitions.

Pearson said on Tuesday Allergan Chief Executive David Pyott and the company's board had been unwilling to discuss a merger with Valeant. In a letter to Allergan, Valeant said it would have preferred to negotiate a deal in private.

Allergan said in a statement on Tuesday that it has received the offer, and will carefully consider the proposal and "pursue the course of action that it believes is in the best interests of the company's stockholders."