>>> US Gapping up

Gapping up

In reaction to strong earnings/guidance: DNDN +9.4%, PERI +7.5%, MGA +3.2%, (light volume).

Metals/mining stocks trading higher: AU +5.2%, IAG +5.1%, EGO +5.1%, HMY +4.6%, KGC +4.2%, GG +4%, GOLD +3.8%, AG 3.5% (First Majestic Silver promotes Salvador Garca to the role of Chief Operating Officer starting July 1, 2014 ), RGLD +3.3%, CDE +2.7%, SLW +2.6%, GDX +2.4%, GLD +1.6%, SLV +1.5%.

Other news: NQ 10.8% (following late sell-off on Friday), PCC 6.2% (declares special dividend and announces that it will transfer to NASDAQ Global Market), ARRY 5.8% (rovides Clinical Update On ARRY-502 For Asthma At Scientific Meeting; ARRY-502 met the primary endpoint in the trial, Secondary efficacy endpoints also achieved statistical significance), CNAT 5.2% (Conatus Pharma extends liver disease reach with Phase 2 NAFLD/NASH trial ), GALE 4.8% ( launches Galena Patient Services), ASNA 3.3% (favorable mention on Friday's Mad Money), SGMO 3.3% (still checking), LO 1.9% (still checking), STO 1.7% (reported that Zafarani reservoir in Tanzania Block 2 successfully tested), WPRT 1.2% (Westport and Delphi (DLPH) Sign Joint Development Agreement to Commercialize Natural Gas Injector Technology), ISIS 1.1% (Earns $1 Million from GSK for Advancing ISIS-TTR Rx), JOSB 0.8% (Men's Wearhouse Announces Non-Disclosure Agreement With Jos. A. Bank).

Analyst comments: ASPX +6.9% (initiated with an Outperform at BMO Capital Mkts ), RVNC +5.2% (initiated with an Outperform at BMO Capital Mkts, initiated with a Overweight at Piper Jaffray; initiated with an Outperform at Cowen), ACMP +0.6% (upgraded to Buy at Wunderlich)

>>> Billionaire Potanin Offers RU2.5b to Former Wife in Divorce Deal

$70mil look very low for an oligarch who's ranked by forbes as 86th healthy man, 8th in russia with a net worth of $12.6bil

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

Billionaire Potanin Offers RU2.5b to Former Wife in Divorce Deal 2014-03-03 12:50:10.205 GMT

By Yuliya Fedorinova March 3 (Bloomberg) -- Billionaire Vladimir Potanin filed claim with Moscow court to split assets with ex-wife, his lawyer Marina Ivanova says by phone. * Pre-court hearings start March 13, she says * Natalia Potanina may get 2.5b rubles in cash, property, Ivanova says * NOTE: Potanin got divorce last month, may pay 8.5m rubles/mo. as child support to ex-wife: IFX NSN N1K41F6KLVRB <GO> * NOTE: Billionaire Vladimir Potanin Moves Some of His Assets to Charity NSN N0MFVG6VDKIR <GO>

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

--Editor: John Viljoen

To contact the reporter on this story: Yuliya Fedorinova in Moscow at +7-495-771-7707 or yfedorinova@bloomberg.net

To contact the editor responsible for this story: John Viljoen at +44-20-7673-2472 or jviljoen@bloomberg.net

>>> NYTimes discusses energy sector report that shows power grid is not setup we

--> Could impact PANW, FEYE, FTNT CHKP IMPV

Report Calls for Better Backstops to Protect Power Grid From Cyberattacks { http://nyti.ms/1fBWXrF}

WASHINGTON — Despite rising anxiety over the possibility of a cyberattack on the power grid, the industry and government are not set up well to counter the threat, according to a report produced by leading energy security experts. Companies are reluctant to share information with one other, a critical step in reducing vulnerability, because they are afraid of being accused of failing to comply with cybersecurity rules, committing antitrust violations or giving away proprietary information, the report found.

And the federal rules intended to protect the electric system from cyberattack are inadequate because they do not give companies an incentive to continually improve and adapt to a changing threat, according to the report, which was released on Friday.

The report was produced by the Bipartisan Policy Center, a Washington nonprofit group, and led by Michael V. Hayden, the former director of the C.I.A.; Curt Hébert Jr., a former chairman of the Federal Energy Regulatory Commission; and Susan Tierney, a former assistant secretary of energy and former utility regulator in Massachusetts. The experts also found that while the government had focused on the high-voltage power grid, less work has been done on the lower-voltage distribution system, which could cause problems that would propagate up the chain.

Cyberwarfare is “a domain that favors the attacker,” Mr. Hayden said in a panel discussion on Friday about the report. But he said the United States could reduce its vulnerability and improve its ability to recover. He even quoted a line spoken by John Wayne in the movie “Sands of Iwo Jima”: “Life is tough, but it’s tougher if you’re stupid.”

Most hacking against utilities is done by people trying to steal financial data, including that of customers, but experts fear an act of war, or what Mr. Hayden called “recreational espionage.”

Not even the public utility commissions are well set up for the new problems, the report said. Regulated utilities can add security costs to the expenses for which they bill their customers, if the regulators find the expenditures “prudent,” but “many regulators lack the expertise to make these judgments,” the report said. And many entities on the grid are unregulated, in a competitive market, which may make it hard for them to recover their costs. But the report painted cybersecurity in a way that parallels vaccination for disease; wider participation helps both individuals and the community.

The report recommended establishing an organization like the one set up after the Three Mile Island accident in 1979 by the nuclear industry, the Institute of Nuclear Power Operations, to conduct peer-to-peer audits, and disseminate best practices.

Outside experts who were not involved with the report endorsed some of its findings. Samuel P. Liles, associate professor at Purdue, where he works in the Cyber Forensics Laboratory, said that sharing best practice was “a hit or a miss,” although threat information was shared.

At the Utilities Telecom Council, a trade association of electric and water utilities, Nadya Bartol, a cybersecurity expert, said the report was correct in asserting that utilities might not always come forward with helpful information.

“If utilities say, ‘I have this vulnerability,’ they might get fined if that’s a violation,” she said. And they may hesitate to talk about their vulnerabilities because, “if I put it out in the public space, I will get hacked more.”

The report also raised the issue that public utility commissioners, who decide which utility expenses are “prudent” and thus eligible to be passed on to customers, have trouble determining the value of such investments. At the National Association of Regulatory Utility Commissioners, a nationwide organization of state commission members, Miles Keogh, the co-author of a paper on evaluating such investments, said commissioners should approach the problem as a management audit, and not get into the details of security. The normal forum for determining prudence, a rate case, “is “a great place to argue about stuff, but not to take on terra incognita issues,” he said.

NYT : NJOY, E-Cigarette Maker, Receives Funding Valuing It at $1 Billion

Link to article : {http://nyti.ms/1lur5b1}

NJOY, E-Cigarette Maker, Receives Funding Valuing It at $1 Billion

Even as electronic cigarettes draw the scrutiny of regulators around the world, investors are seeing potential in the fledgling industry.

This week, the electronic cigarette maker NJOY received a $70 million capital injection from a group of investors including Brookside Capital and Morgan Stanley Investment Management, in the latest vote of confidence for a fast-growing industry.

The company, based in Scottsdale, Ariz., boasts several entrepreneurial investors including Sean Parker, the co-founder of the now-defunct Napster, and Peter Thiel, one of the founders of PayPal.

The private round of funding values the company at around $1 billion, according to a person briefed on the financials, and comes as regulators in Europe and the United States are looking to legally define parameters for the industry. Earlier this week, the European Parliament approved regulations in the European Union for the industry that could be copied in other countries.

Related Links
European Parliament Approves Tough Rules on Electronic Cigarettes (Feb. 26, 2014)
Electronic cigarettes, or e-cigs for shorthand, are being marketed as an alternative to real cigarettes. They simulate tobacco cigarettes, but operate as battery-powered devices that deliver nicotine and/or flavoring through a liquid solution. Atomizers create the same sensation a smoker gets from blowing smoke.

But the industry has come under scrutiny from some health officials who say the safety of e-cig products has not yet been proved. Others raise concerns that a boom of e-cigs products will revitalize the appeal of cigarettes.

NJOY, whose e-cig products are sold in more than 90,000 stores in the United States, and more than 40,000 outlets across Europe, has marketed itself as a technology company that is trying to defeat a health epidemic rather than prolong its demise.

“We believe that only an independent company can have as its corporate mission the extraordinary technological and important objective to make cigarettes obsolete,” said Craig Weiss, chief executive of NJOY. Mr. Weiss, who is a patent lawyer and former hedge fund manager, compared the initiative and its ambition to putting a man on the moon.

His brother Mark, also a lawyer, founded NJOY in 2006 after a trip to China inspired him to enter the electronic cigarette market. During his trip, he visited a trade show where e-cigs, so large they looked like cigars, were being showcased.

“It seemed to him that this was the future of smoking,” said Mr. Weiss, who took over as president of NJOY in 2010.

It is a view not shared by the Europe, which ruled this week that advertising for e-cigarettes would be banned in 28 nations. The new rules, which will be enforced in 2016, also set limitations for the amount of nicotine e-cigarettes can contain and will force e-cigarette makers to include health warnings on the product.

In the United States, the Food and Drug Administration has categorized e-cigarettes as “tobacco products” but has not yet determined any rules for them. But pressure has been building from lawmakers to take a harder line and begin immediate regulatory oversight.

For now, sales of e-cigarettes continue to soar. Industry experts estimate that the market is worth nearly $2 billion. although that is just a fraction of the $80 billion-a-year tobacco industry in the United States. Analysts at Wells Fargo recently estimated that e-cigarettes could replace regular cigarettes within the next decade.

But as e-cigarettes become more popular, major tobacco companies are taking note. Lorillard, the maker of cigarette brands like Newport and Kent, acquired Blu eCigs for $135 million in 2012, and RJ Reynolds, Japan Tobacco International and British American Tobacco have also scooped up stakes in emerging e-cigarette companies.

The presence of such big tobacco firms has caused some critics to question whether e-cigarettes are just a new way to get people hooked on nicotine, an addiction that could lead them to turn to tobacco cigarettes.

To counter that impression, NJOY points to its unusual team of executives that include veterans of the old tobacco industry, as well as scientists and well-respected doctors to help with this image. It recently added former Surgeon General Dr. Richard H. Carmona, who served in the George W. Bush administration, to its board.

With lighter regulation in the United States, many American e-cigarette companies have taken advantage, introducing a flurry of advertising campaigns on television. In 2012, NJOY ran a series of ads in print, television and online with the tagline: “Cigarettes, you’ve met your match.”

The industry has already made strides in popular culture. In the current season of the popular Netflix political series “House of Cards,” the main character, Frank Underwood, is caught by his wife smoking a cigarette. She accuses him of caving in to his addiction.

“No, I’m not,” he tells her, indicating it’s an e-cigarette. He adds, “Addiction without the consequences.”

>>> TOBACCO - MORE CONSOLIDATION - FT Alphaville saying REYNOLDS AMERICAN (RAI

TOBACCO - MORE CONSOLIDATION - FT Alphaville saying REYNOLDS AMERICAN (RAI US) may buy LORILLARD (LO US) / QUICK TAKE
* The journalist suggests that Reynolds American may buy Lorillard for $22bln (implying a 24% premium)
* If confirmed, this news may fuel speculation for more M&A in Tobacco...watch Imperial Tobacco, Swedish Match...
* Our take for BAT: A bid by Reynolds on Lorillard would be 5-6% accretive to BATS.

>>> US Early premarket gappers

Early premarket gappers

Gapping up: NQ +10.8%, PCC +6.2%, PERI +5.6%, AU +5.2%, IAG +5.1%, KGC +4.2%, GG +4%, GOLD +3.8%, CDE +2.7%, SLW +2.6%, GDX +2.4%, ROC +2.2%, LO +1.9%, GLD +1.6%, SLV +1.5%

Gapping down: MTL -21.1%, YNDX -17.3%, MBT -12.9%, CCIH -12.3%, QIWI -9.5%, VIP -8.5%, CETV -7.2%, MT -4.2%, ARIA -3.4%, CTIC -2.3%, JKS -2.2%, C -2.1%, CTB -2.1%, LVS -1.5%, SODA -1.5%, BA -1.3%, IBM -1.1%, NDLS -1%, AAPL -0.8%, MSFT -0.8%, CMCSA -0.8%, HLF -0.5%

WSJ : Japan Display is No Bright Idea for Average Investors

Japan Display is No Bright Idea for Average Investors

Apple AAPL -0.27% iPhone users stare at Japan Display's screens all day. But that doesn't make the company's initial public offering a good deal for ordinary investors.

Japan Display was formed from the wreckage of the loss-making liquid crystal display businesses of Hitachi, 6501.TO -1.99% Toshiba 6502.TO +0.91% and Sony 6758.TO -1.12% in 2012, with investment from a government-backed fund. The company's public listing is a success for the state-led restructuring, implemented in fear that Japan Inc. would lose technological competitiveness.

Combining technology from its three predecessors, the company boasts leading LCD capabilities, especially in compact and power-efficient "low temperature polycrystalline silicon" panels. The restructuring helped the company cleanse itself of "inefficient decision-making" by the former parent companies and created "an appropriately sized workforce," according to offering documents. The smartphone boom of the past few years helped the company get on its feet.

Japan Display excels in the sheer manufacturing prowess needed to crank out highly customized displays on tight production cycles for demanding smartphone makers, says IHS IHS +0.46% analyst Jim Masuda. Apple is its top customer, accounting for 32% of sales, followed by Sony at 10%.

In theory, Japan Display should have among the highest operating profit margins in the industry since it focuses on profitable panels that go into smartphones and tablets rather than larger, less lucrative TV-sized panels. Yet earnings before interest, taxes, depreciation and amortization were 13% of revenue in 2013, less than 18.5% for Korean rival LG Display, 034220.SE -2.46% and 17.3% for Taiwan-based Au Optronics, 2409.TW -1.46% despite these competitors producing more TV-sized panels.

The lower margins may come from having to invest in cutting-edge technology and manufacturing to please a big customer such as Apple. Operating in Japan also likely means the company's basic cost base is higher than in Korea or Taiwan, though the weakening yen should help to a degree. It's also possible that cost synergies resulting from three companies coming together didn't go far enough.

The offering hardly looks cheap. After crediting the company with proceeds from the IPO, shares at the price range announced Monday would go for around 1.3 to 1.5 times book value. LG Display and Au Optronics trade at 0.8 and 0.6 times book, respectively.

Investors would be right to wait to see if Japan Display can translate technological advantages into better profits. "Display me the money" should be their mantra.