TheChek News Flow

US Market closed on High on back of Yellen Dovish comments (Senate banking committee statement)...Snapchat Spurned $3 Billion Acquisition Offer from Facebook (WSJ)...CSCO -10% after Hours after disappointing numbers, EPS beat but the top line was shy of estimates, as Cisco also announced a 11% market cap share repurchase authorization. Q2 guidance on the conference call was atrocious, sending shares to its lows around $21.50..VIX @ 12.52 -2.3%...Brazil+0.82%...Japan preliminary Q3 GDP slowed to a 3-quarter low but beat estimates by a decimal at 0.5%. Delving into the data, exports contracted 0.6% and private consumption slowed to 0.1% from 0.6%, while private residential investment was much stronger at 2.7% v 0.4% prior...In China, PBoC once again deferred its Thursday open market operations, leading some to suggest the central bank will only conduct its money market activity once a week. Short-term rates tightened, with overnight Shibor rising to 2-week highs...Nikkei +2.12%...Shanghai +0.6%

Eur$ 1.3465 S&P Fut +0.25% European Fut +0.95%

* GERMANY Q3 PRELIMINARY GDP Q/Q: 0.3% V 0.3%E; Y/Y: 1.1% V 1.0%E * FRANCE Q3 PRELIMINARY GDP Q/Q: -0.1% V 0.0%E; Y/Y: 0.2% V 0.3%E

Keep an eye on :

- ABLX BB : Ablynx 9-Month Net Loss EU18.9 Mln Vs EU22.3 Mln Loss - AH NA : Ahold to Distribute EU1b to Shrholders, Sells Slovakia Unit, Reverse stock split in Q1 14 - AKER NO : Aker 3Q NAV NK21.8b; Says Detnor Should Monetize Non-Core Assets - AR4 GY : Aurelius 9M Cons. Sales Rise 24%; Sees Profit in 2013 - AWDR NO : Awilco Drilling 3Q Net $36.6m Beats Est. $31m - BALN VX : Baloise Says On Course to Meet Operational, Financial Targets - BAMNB NA : BAM 9-Month Rev Drops to EU5b From EU5.07b - B5a GY : Bauer Posts 9M Net Loss; Sees Return to Profit in 2014 - BC8 GY : Bechtle 3Q EPS Rises 34%; Refines 2013 Outlook - BNP FP : BNP Paribas acquires remaining 25% from Belgian gov. For €3.23bn - CAP FP : CSCO -10% in after hours on Earnings - EAD FP : EADS 3Q Ebit In-Line; Confirms Profit Forecast, Cuts FCF Plan - EVS BB : EVS Broadcast 3Q Net Falls 50%, Maintains 2013 Sales Guidance - OGZD LI : Gazprom 2Q Net RU202b Beats Est. RU201b - KBC BB : KBC to Provision Extra ~EU775m in Ireland; Adj. Net Beats Ests. - KGH PW : KGHM 3Q Net 518m Zloty; Analyst Est. 506.4m zloty - KGX GY : Kion 9-Month Adj. Ebit EU301m, Est. EU300m; Confirms Forecast - SDF GY : K+S 3Q Ebit I Beats Ests., Sees 2013 Profit at More Than EU600m, Sees 2013 Capex of EU800m, EU375m for Legacy Project - MRK GY : Merck KGaA 3Q Rebif Rev. EU460m, Down 7.9% Y/y, Raises 2013 Forecast on Cost Reduction Measures - KN FP : Natixis CEO Mignon Plans Coface IPO by June 2014, Les Echos Says - NDX1 GY : Reports Q3 Net profit €5.3M v €15.6M y/y; Rev €1.05B, +47% y/y Reaffirms outlook - Raises intake target - NOVN VX : Novartis Reports Positive Trial Results for Avian Flu Vaccine - OPHR LN : Temasek's Pavilion Energy Pays $1.3Bln for Tanzania Gas Stake - POST AV : Austrian Post 3Q Sales and Ebit Miss Analyst Estimates - RWE GY : RWE Sees 2014 Recurrent Net Below Estimates, 9M Recurrent Net Misses; Sees 2014 Significantly Lower - SAZ GY : Salzgitter 3Q Sales, Ebit Miss Estimates, Confirms 2013 Outlook - SAP GY : CSCO -10% after Hours on Earnings - SBMO NA : trading update YTD 2013 Directional1 revenues up 25% to US$2.6 billion, IFRS revenues up 40% to US$3.4 billion - SW FP : Sodexo Sees FY14 Gains in Organic Sales Growth, Operating Margin - TLX GY : Talanx 3Q Net Misses Est., Sees 2014 Net of at Least EU700m - TEF SM : Telefonica will not exercise call option to take 100% control of Telco until 2015 - TIT IM :Telecom Italia Agrees to Sell Telecom Argentina Assets for $960m to Fintech - TKA AV : Telekom Austria 3Q Ebitda In Line, Confirms Forecast - TESB BB : Tessenderlo Cuts 2013 Forecast; Plans to Omit Dividend Payout - ZURN VX : *ZURICH INS. TO MISS RELATIVE COMBINED RATIO IMPROVEMENT TARGETm

Up

*BEIERSDORF RAISED TO BUY VS SELL AT DZ BANK *BOOKER GROUP RAISED TO CONVICTION BUY VS NEUTRAL AT GOLDMAN *FLYBE RAISED TO OVERWEIGHT VS NEUTRAL AT HSBC *GULF KEYSTONE RAISED TO OVERWEIGHT VS NEUTRAL AT HSBC *KAZMUNAIGAS RAISED TO BUY VS NEUTRAL AT GOLDMAN *KPN RAISED TO BUY VS HOLD AT ING *MAERSK RAISED TO NEUTRAL VS UNDERPERFORM AT CREDIT SUISSE *SAINSBURY RAISED TO BUY VS NEUTRAL AT CITI *VODACOM GROUP RAISED TO BUY VS NEUTRAL AT UBS *UNICREDIT CUT FROM CONVICTION BUY AT GOLDMAN, STILL A BUY

Down

*BREMBO CUT TO NEUTRAL VS BUY AT UBS *E.ON CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS *KABEL DEUTSCHLAND CUT TO NEUTRAL VS OUTPERFORM AT EXANE *MAPFRE CUT TO EQUALWEIGHT VS OVERWEIGHT AT MORGAN STANLEY *TERNA CUT TO NEUTRAL VS OUTPERFORM AT CREDIT SUISSE *TESCO CUT TO SELL VS NEUTRAL AT GOLDMAN *TOD'S CUT TO UNDERPERFORM VS BUY AT BOFAML *TRYG CUT TO SELL VS HOLD AT BERENBERG

PT changes

*INTESA PT RAISED TO EU1.7 VS EU1.6 AT NOMURA; KEPT AT NEUTRAL *Pirelli PT Raised to EU11 vs EU9.5 at Deutsche Bank *TOD’S PT CUT TO EU102 VS EU105 AT DEUTSCHE BANK; KEPT AT HOLD *TOD’S PT CUT TO EU101 VS EU104 AT UBS; KEPT AT SELL

Initiation

*AEROFLOT RATED NEW OVERWEIGHT AT JPMORGAN; PT RUB74.11 *ARSEUS NV RATED NEW BUY AT JEFFERIES, PT EU28

Country Sector Stock Call

*LONG KPN, TELENET, SHORT BELGACOM, MOBISTAR, ING SAYS *BOOKER GROUP RAISED TO CONVICTION BUY VS NEUTRAL AT GOLDMAN *UniCredit Exits Conviction Buy at Goldman on Lower Top-Line Ests

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BN 11/14 07:02 *PAVILION ENERGY TO COMPLETE TANZANIA GAS PURCHASE IN Q1 2014 BN 11/14 07:02 *PAVILION SAYS IS FIRST SINGAPORE CO. TO INVEST IN TANZANIA GAS BN 11/14 07:02 *FIRST TANZANIA GAS DELIVERY EXPECTED 2020, PAVILION SAYS BN 11/14 07:02 *TANZANIA BLOCKS ESTIMATED TO HOLD 15 TCF, PAVILION SAYS BN 11/14 07:01 *TEMASEK'S PAVILION BUYS $1.3B TANZANIA GAS STAKE FROM OPHIR BN 11/14 07:01 *TEMASEK'S PAVILION BUYS TANZANIA GAS STAKE FROM OPHIR

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*TEMASEK’S PAVILION BUYS $1.3B TANZANIA GAS STAKE FROM OPHIR 2013-11-14 07:01:45.810 GMT

--JAN DAHINTEN

-0- Nov/14/2013 07:01 GMT

Telecom Italia: Telefonica will not exercise call option to take 100% control of Telco until 2015

Telefonica has no intention of increasing its stake in Telco, the holding that controls Telecom Italia, until February 2015, Telefonca CEO Cesar Alierta said in a long interview with Italian language daily Il Sole 24 Ore. Alierta acknowledged that Telefonica had the right to take complete control of Telco from 1 January 2014 but would not do so until the Telco shareholder pact ran out in February 2015.

Alierta also told Il Sole that the Italian members of Telco, Mediobanca, Intesa Sanpaolo and Generali would also remain in Telco until February 2015.

Alierta also said that it would be no problem for Telefonica if Telecom Argentina was not sold off. He noted that Telefonica had no interest in the running of TI's overseas assets, as the Spanish group was focused on turning round TI's domestic operations.

Source Il Sole 24 Ore

Telecom Italia Agrees to Sell Telecom Argentina Assets for $960m Telecom Italia agrees to sell entire controlling interest in Telecom Argentina to Fintech Group. Of total amount $859.5m to be paid as consideration for sale of 68% of voting shares in Sofora held by Telecom Italia and Telecom Italia International; ~15.5m Class B shrs of Telecom Argentina held by Tierra Argentea, representing 1.58% of the outstanding shrs; ~2.35m American Depositary Shares, representing 117,588 Preferred B shrs of Nortel held by Tierra Argentea, equal to 8% of the outstanding Preferred B shrs of Nortel Says remaining $100.5m to be paid pursuant to additional agreements related to the transaction

Asian Market Update: Cisco plummets on earnings; Yellen statement to Senate banking committee sounds dovish, supporting equities; Japan Q3 GDP slows; BOK on hold as expected

***Observations/Insights*** - Shares of Cisco are down over 10%, wrapping up what has been a fairly disappointing earnings season in the tech space. EPS beat but the top line was shy of estimates, as Cisco also announced a 11% market cap share repurchase authorization. Q2 guidance on the conference call was atrocious, sending shares to its lows around $21.50. - Fed chair nominee Yellen will face confirmation hearings in the Senate banking committee on Thursday. Her opening remarks released just after the US close were characteristically dovish, stating unemployment remains too high with inflation running below 2% target and will continue to do so for some time. Dollar briefly sold off on the statement and US equity futures are up about 5 handles, as worries that Yellen will try to strike a more moderate tone to generate consensus among the more hardline inflation hawks appear to have dissipated. Investors had previously speculated the Fed may be entertaining the possibility of a December taper after the stronger than expected jobs figures. - Japan preliminary Q3 GDP slowed to a 3-quarter low but beat estimates by a decimal at 0.5%. Delving into the data, exports contracted 0.6% and private consumption slowed to 0.1% from 0.6%, while private residential investment was much stronger at 2.7% v 0.4% prior. - BOK was on hold as expected at 2.5% for the 6th consecutive meeting. Gov Kim maintained 2.8% GDP target for 2013 and noted that negative domestic output gap would dissipate sometime in H2 of 2014. - In China, PBoC once again deferred its Thursday open market operations, leading some to suggest the central bank will only conduct its money market activity once a week. Short-term rates tightened, with overnight Shibor rising to 2-week highs.

***Economic Data*** - (KR) BANK OF KOREA (BOK) LEAVES 7-DAY REPO RATE UNCHANGED AT 2.50% (AS EXPECTED); SIXTH STRAIGHT PAUSE - (AU) AUSTRALIA NOV CONSUMER INFLATION EXPECTATION: 1.9% V 2.0% PRIOR (*NOTE: Below RBA's 2-3% target range) - (JP) JAPAN Q3 PRELIM GDP Q/Q: 0.5% (3-quarter low) V 0.4%E; NOMINAL GDP Q/Q: 0.4% V 0.4%E; GDP ANNUALIZED Q/Q: 1.9% V 1.7%E; GDP DEFLATOR Y/Y: -0.3% V -0.5%E - (JP) JAPAN SEPT FINAL INDUSTRIAL PRODUCTION M/M: 1.3% V 1.5% PRELIM; Y/Y: 5.1% V 5.4% PRELIM; CAPACITY UTILIZATION M/M: +1.2% V -2.1% PRELIM - (JP) Japan Sept Conference Board Leading Economic Index: 100.1, +1.2% v -0.1% prior - (JP) Japan investors bought net ¥357.1B in foreign bonds last week (5th straight week of net purchases) vs bought net ¥276.6B in prior week (5th straight week of net purchases); Foreign Investors bought net ¥273.1B in Japan stocks v bought net ¥247.9B in prior week - (NZ) NEW ZEALAND Q3 RETAIL SALES EX-INFLATION Q/Q: 0.3% V 0.9%E (1-year low) - (NZ) NEW ZEALAND OCT BUSINESS MANUFACTURING PMI: 55.7 V 54.2 PRIOR - (NZ) NEW ZEALAND NOV ANZ CONSUMER CONFIDENCE INDEX: 128.4 V 122.3 PRIOR; M/M: 5.0% V 2.9% PRIOR - (NZ) NEW ZEALAND OCT NON RESIDENT BOND HOLDINGS: 64.8% V 67.0% PRIOR

***Fixed Income/Commodities/Currencies*** - (CN) PBoC won't conduct open market operations (OMO) in today's session; Drains net CNY15B this week v drained CNY5B last week; Said to drop Thursday OMO - (CN) Daily Shibor fixings: O/N: 4.1880% v 3.3360% prior (2nd consecutive rise, highest since Oct 31st); 1-week: 4.1930% v 3.6350% prior (2nd consecutive rise, highest since Nov 4th) - (JP) Japan's MoF sells ¥2.45T in 0.2% (0.2% prior) 5-yr notes; Avg yield: 0.193% v 0.230% prior; Bid to cover: 5.03x v 4.83x prior - GLD: SPDR Gold Trust ETF daily holdings fall 2.7 tonnes to 865.7 tonnes (lowest since Feb 2009) - (US) API PETROLEUM INVENTORIES: CRUDE: +599K v +1Me (lowest build in 7 weeks); GASOLINE: -1.67M v -1Me; DISTILLATE: +605K v -1Me

- USD/CNY: (CN) PBoC sets yuan mid point at 6.1315 v 6.1342 prior setting (record high setting for yuan)

- USD/JPY is the biggest mover on the session among the dollar majors as investors cheered slightly better than expected Q3 preliminary GDP with a yen-funded purchase of risky assets. Comments from Fin Min Aso mentioning the possibility of an intervention, presumably to combat the downward pressure from dovish US Fed, also generated a fair amount of yen selling. USD/JPY was up nearly 60pips from the lows, testing 99.70, while EUR/JPY and AUD/JPY rose 50 and 60 pips to as high as 134.30 and 93.20 respectively. In other dollar majors, EUR/USD was contained in 1.3460-90 range despite the initial spike on dovish Yellen comments. NZD/USD shook off weak Q3 retail sales, rising over 70pips above 0.8340 at session's best levels.

***Speakers/Political/In the Papers*** - (CN) China State Council adviser: Expects big move in property taxes within the next 1-2 years - Chinese press - (CN) China's Anhui Province announces reform plan for rural area

- (JP) Japan Fin Min Aso: Japan must always be ready to send signal to markets it can curb excessive, one-sided forex moves - (JP) Japan Chief Cabinet Sec Suga: Domestic economy continues to be on an uptrend - financial press - (JP) Japan Econ Min Amari: Japan economy remains on uptrend with solid domestic demand

- (AU) RBA Board member Ridout: AUD will hurt economy if its strength is sustained - (AU) Australia Senate said to have started debate on legislation to increase debt ceiling - financial press

***Equities*** Market Snapshot (as of 04:30 GMT): - Nikkei225 +2.6%, S&P/ASX +0.7%, Kospi +0.6%, Shanghai Composite +0.4%, Hang Seng +0.9%, Dec S&P500 +0.2% at 1,783, Dec gold +1.3% at $1,284, Dec crude oil flat at $93.89/brl

US markets: - CSCO: Reports Q1 $0.53 v $0.50e, R$12.09B v $12.3Be; board approves additional $15B buyback program (11% of market cap); Guides Q2 Rev -8 to -10% y/y v +4.1%e (implies R$10.9-11.1B v $12.6Be) - conf call; -10.3% afterhours - NTES: Reports Q3 $1.31 v $1.34e, R$410.8M v $386Me; -7.8% afterhours - GWR: Announces Sale of 5.98M Shares of Common Stock by Carlyle Investment Funds (11.6% of shares outstanding); -2.8% afterhours - WDC: Raises quarterly dividend by 20% to $0.30/shr from $0.25/shr - NTAP: Reports Q2 $0.66 v $0.63e, R$1.55B v $1.60Be; +1.0% afterhours

Notable movers by sector: - Consumer discretionary: Mizuno Corp 8022.JP -3.5% (H1 results) - Consumer staples: Warrnambool Cheese & Butter WCB.AU -0.1%, Bega Cheese BGA.AU -3.1% (Bega raises offer for Warrnambool) - Industrials: Tekken Corp 1815.JP +3.1% (H1 results); James Hardie Industries NV JHX.AU +13.9% (H1 results); First Tractor 38.HK +3.6%, Xinjiang Machinery Research 300159.CN +3.8%, Winall Hi-tech Seed 300087.CN +10.0%, Stanley Fertilizer 002588.CN +4.7% (China's Anhui province announces rural reform plan) - Materials: OceanaGold Corp OGC.AU +2.1% (exec provides FY13 outlook); Bluescope Steel Ltd BSL.AU +4.0% (provides trading update) - Technology: VTech Holdings Ltd 303.HK -3.8% (H1 results); Tencent Holdings Ltd 700.HK +5.0% (Q3 results); Hon Hai Precision Industries 2317.TW +1.8% (Q3 results) - Utilities: TEPCO 9501.JP +2.3% (facility prepared for fuel removal) - Telecom: KDDI Corp 9433.JP +5.1% (to launch LTE service while roaming in US network) - Healthcare: Shandong Weigao Group Medical Polymer 1066.HK +30.6% (Q3 results; analyst action); Sino Biopharmaceutical 1177.HK +3.4% (9-month results)

Japanese growth halved in third quarter

The rate of growth in Japan’s economy roughly halved between the second and the third quarters, the government reported on Thursday, as weaker consumption and exports offset big rises in public works spending and property investment. According to Cabinet Office estimates, the real value of goods and services produced by the world’s third-largest economy grew at an annualised rate of 1.9 per cent between July and September. That marked a deceleration from the stimulus-boosted first half, when all three engines – consumption, investment and exports – fired simultaneously to produce quarter-on-quarter growth of 4.3 per cent in the first three months and 3.8 per cent in the second. However, Japan still recorded growth above its potential level, which most economists estimate at between 0.5 per cent and 1 per cent. And many expect a pick-up in the current quarter and in the first three months of 2014, as households boost spending and investment before an increase in the rate of consumption tax, effective from next April. "A good cycle has begun," said Akira Amari, economy minister, in remarks to reporters. "It is important that domestic demand has made a steady contribution." The third-quarter slowdown is "little cause for concern," said Kazuhiko Ogata, chief economist at Crédit Agricole in Tokyo. "In the latter half of the fiscal year [to April 2014] we’ll probably see a lot of front-loaded spending before the tax increase, especially in residential construction activities and in big-ticket durable goods." Nonetheless, the data will sustain pressure on Shinzo Abe to keep Japan’s growth trajectory intact. Since returning to power last December, the prime minister has moved to overturn more than a decade of deflation through the "three arrows" of aggressive monetary easing, a more flexible approach to fiscal spending, and a series of overlapping initiatives to lift the country’s longer-term growth potential. Such efforts spurred the best rate of growth among the major G7 economies in the first half, as a fall in the yen pushed up stock prices and sharpened consumer appetites. Since then, however, policy makers have expressed concerns over a slowdown in external demand focused on China, Japan’s second biggest trading partner, and a softening of domestic demand amid higher prices for fuel and utilities. Data this week on machinery orders was weaker than expected, while consumer confidence in October fell to its lowest level since the aftermath of the 2011 earthquake, suggesting that the combination of rising prices and flat incomes is beginning to hurt. Thursday’s data showed that exports slipped 0.6 per cent from the previous quarter, while the rate of quarter-on-quarter growth in household consumption fell from 0.6 per cent to 0.1 per cent. Private residential investment picked up some of the slack, rising by 2.7 per cent. Attention is now likely to turn to the stimulative powers of the Bank of Japan, which has kept its monetary-policy settings on hold since announcing what insiders call a "180-degree turn" in April. Back then, Haruhiko Kuroda, BoJ governor, promised to buy enough bonds to double Japan’s monetary base within two years, to hit a 2 per cent target for inflation. On Wednesday, policy board member Ryuzo Miyao warned of headwinds from weak overseas growth, and stressed the BoJ’s readiness to supply further stimulus should a dip in the economy threaten the central bank’s upbeat forecasts. At the end of October the BoJ said that board members predicted real growth of 1.5 per cent in the next fiscal year. Private-sector forecasters, by contrast, expect growth of 0.7 per cent, as they are counting on a big drag on consumption following the tax increase. "The bank’s forecasts are very, very optimistic, well above market consensus," said Hiroshi Shiraishi, economist at BNP Paribas.

OECD issues warning on French economy

France is lagging behind other European countries in reforming its economy and needs to take comprehensive steps to restore its competitiveness, a stark report from the OECD, the club of rich countries, has warned. In one of the most wide-ranging critiques by an international institution of France’s competitive weaknesses, the 87-page report sent a clear message to President François Hollande’s Socialist government that it has not done enough to overhaul Europe’s second-largest economy. The Paris-based organisation said France had seen "no significant improvement" in its external position since the onset of the financial crisis in 2008. "Over several years, many European countries have accelerated the adoption and implementation of essential reforms. This adjustment has not happened in France," the report said. Driving home the message, Angel Gurría, OECD secretary-general, wrote in a preface: "The efforts under way [by the government] should be written into a strategy of more comprehensive and coherent, fundamental reforms to increase productivity and restore the competitiveness of the French productive fabric." Mr Hollande, struggling against rising opposition from both left and right to his administration, insists that reforms he has undertaken to reduce the budget deficit, lower France’s high labour costs, loosen its restricted labour market and tackle its pension system deficit are starting to bear fruit. But the report listed a catalogue of remaining structural problems that contributed to France’s greater loss of global market share than that seen by other big economies since 2000. It cited France’s high minimum labour costs (80 per cent above the OECD average), high cost of public services (27.4 per cent of gross domestic product), heavy tax burden on employment (50 per cent of wage costs) and millefeuille of central and local government (including 36,700 municipalities) as among the factors holding back French competitiveness. It said earnings per head in France had grown slower than in other "advanced" OECD countries, economic growth had been below the OECD average and levels of employment, especially among young and older workers, were damagingly low. The report acknowledged the government’s move to give companies a €20bn tax break to lower labour costs. But it said this only dealt with half of the gap between the "tax wedge" in France – the difference between labour costs to the employer and the employee’s take-home pay – and the OECD average. On pensions, the report said the government should consider "more ambitious measures focused on spending cuts". It specifically called for lower indexation of pensions, more rapid introduction of longer contribution periods and a higher statutory retirement age – all measures rejected by Mr Hollande in his pensions reform earlier this year. The OECD added that the "corner stone" for improving growth and competitiveness was further reform of the labour market, including more flexibility in contract conditions and moderation of minimum wage costs. It also called for liberalisation of product and service markets, especially in areas such as energy, retail and transport, and an overhaul of training and education.

After Hours Summary: YUME +17.2%, TCX +15.4%, BORN +13.6%, PRCP -26.2%, FENG -17.1%, MM -15.2%, CSCO -10.8% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: YUME +17.2%, TCX +15.4%, BORN +13.6%, CGIX +6.8%, JST +5.9%, OINK +4.7%, KGC +1.4%, NTAP +1.4%, LOV +0.3% Companies trading higher in after hours in reaction to news: - NVAX +3.1% (New England Journal of Medicine publishes positive data from clinical trial of Novavax' vaccine against H7N9 avian flu), - MEG +2.8% (Berkshire disclosed 5.5% active stake in amended 13D filing), - AFL +1.1% (Board of Directors increased shares authorized for repurchase by 40 mln), BWA +0.6% (approved a two-for-one stock split effected in the form of a stock dividend on the company's common stock), - SPW +0.5% (announces U.S. qualified pension plan actions; expected to reduce pension obligations by ~$800 mln)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: PRCP -26.2%,FENG -17.1%, MM -15.2%, CSCO -10.8%, CRRS -4.4%, AFCE -3.8%, SEAS -1%, RMAX -0.9%, XONE -0.5% Companies trading lower in after hours in reaction to news: - TWGP -6.9% (filed to delay the filing of Form 10-Q), - AH -4.0% (provided business and restatement update; appoints two new board members and authorizes $50 mln share repurchase program), - GWR -3.2% (announced sale of ~5.98 mln shares of common stock by Carlyle Investment Funds), - THRX -2.0% (disclosed TD-9855 did not meet the primary efficacy endpoint in Phase 2 study in adult patients with ADHD), - END -1.5% (closed on the sale of 50% of its upstream and midstream assets in the Pennsylvania Marcellus and formed a joint venture with Samson Energy), - SINA -0.7% (announced proposed offering of $600 mln convertible senior notes and concurrent $100 mln share repurchase)

Yellen, in Testimony, Says Fed Has More Work to Do

WASHINGTON—The U.S. economy has made "good progress" since the depths of the recession, but has farther to go in regaining what was lost, Federal Reserve Vice Chairwoman Janet Yellen will tell lawmakers Thursday during a hearing on her nomination to be the next leader of the Federal Reserve. Unemployment, at 7.3% in October—down from a recent peak of 10% in 2009—"is still too high, reflecting a labor market and economy performing far short of their potential," Ms. Yellen will say in her opening statement to senators, according to her prepared remarks, released Wednesday afternoon. Inflation remains below the central bank's 2% target and will likely remain low for some time, Ms. Yellen said. Both factors are motivating the Fed's efforts to boost the economic recovery, Ms. Yellen said. She defended the Fed's controversial $85 billion-per-month bond-buying program, anticipating criticism from some senators. "A strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases. I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy." The hearing is scheduled to start at 10 a.m. before the Senate Banking Committee, which has jurisdiction over Fed nominees. Ms. Yellen's opening statement also addressed her support for Fed Chairman Ben Bernanke's efforts to make the central bank more open and transparent. She also pledged to use the Fed's regulatory tools to strengthen the financial system. "I am committed to using the Fed's supervisory and regulatory role to reduce the threat of another financial crisis," she said. Senators of both parties expect she will be confirmed to take over when Mr. Ben Bernanke steps down Jan. 31.