TheChek News Flow

Gapping down

In reaction to disappointing earnings/guidance: CHLN -15.8%, QUNR -5.8%, GFI -4.2%, LOW -3.8%, MODN -3% .

Select metals/mining stocks trading lower: IAG -2.3%, GG -1.2%, AG -1.1%, ABX -1%, GLD -0.8%, EGO -0.8%, HL -0.8%.

Other news: AEZS -8.2% (announces proposed public offering of common shares and warrants), CRNT -6.9% (announces proposed public offering of common stock, size not disclosed), LOV -6.5% (announced that Great Hill Partners, LLC and its affiliates, as selling stockholders, intend to sell shares of common stock of Spark Networks), SSW -5.7% ( plans to offer 3.5 mln Class A common shares in a registered public offering ), ICLD -5.3% (modestly pulling back), FU -4.8% (lower despite reiterating denial of allegations), GOOD -4% (plans to sell shares of its common stock in an underwritten public offering), NHI -1.8% (announces offering of 4.5 million shares of common stock; to acquire 25 independent living facilities), TEF -1.3% (still checking), BUD -1.1% (still checking), GPK -0.9% (announces commencement of secondary common stock offering of ~47.87 mln shares by selling stockholders; announces $200 mln stock repurchase), CLVS -0.6% (acquires Ethical Oncology Science to gain rights to lucitanib, a unique dual-selective Phase 2 FGFR/VEGFR inhibitor, files for 3,713,731 share common stock offering by selling shareholders).

Analyst comments: TWTR -2% (downgraded to Hold from Buy at Cantor), CHRW -1.6% (downgraded to Hold from Buy at Deutsche Bank), WDAY -1.4% (downgraded to Market Perform from Outperform at Cowen), TSLA -1.3% (Hearing tgt cut to $120 from $141 at Barclays), PDCO -0.7% (Patterson Companies downgraded to Neutral from Buy at UBS), BA -0.7% (downgraded to Perform from Outperform at Oppenheimer), MOS -0.6% ( downgraded to Hold from Buy at BGC Partners), POT -0.6% (downgraded to Hold from Buy at BGC Partners)

French bonds could sell off sharply if US yields rise

When France’s weak economy and public finances are panned by international critics, its politicians have an easy riposte: just look at our bond yields. Paris can borrow at lower costs than London, and the spread between French over German 10-year bonds has remained remarkably stable over the past year. Standard & Poor’s early morning announcement two weeks ago of another downgrade – this time to double A – failed to cause markets to choke on their croissants. Investing in French assets cannot be so awful.

Could that change as the US Federal Reserve starts to wind back its exceptional stimulus measures? Among investors I have spoken to recently, a school of thought is developing that it might. During the global “taper turmoil” earlier this year – the weeks after May 22, when Ben Bernanke, Fed chairman, first hinted at his plans to taper, or scale back Fed asset purchases – eurozone bond markets remained surprisingly tranquil, even as emerging markets sold off sharply. But while global policy makers and economists still struggle to understand the interlinkages between Fed actions and global markets, it seems implausible that Europe can escape unscathed when tapering becomes real, perhaps as early as December. After all, “global QE” – quantitative easing by the Bank of Japan as well as the Fed – drove European bond prices higher and yields lower; taper turmoil showed the potential for disruption when it goes into reverse. Stabilising factors If there will be European fallout, where will the effects be worst? Intuitively, the weaker eurozone “periphery” economies seem most at risk of a market correction as global QE ebbs, especially if fresh taper turmoil increases investors’ risk aversion. In fact, countries such as Spain, Italy and Ireland have benefited from four stabilising factors this year. First has been their transition – thanks to the European Central Bank acting as a backstop – from existential crises to something nearer normal economic conditions. Growth is low and unemployment alarmingly high, but the danger of imminent ejection from the euro has gone. Second, at least Irish and Spanish bonds have benefited as turnround stories, with tangible evidence of structural reforms improving competitiveness and growth prospects. Third has been the “re-domestication” of Spanish and Italian bond markets – fickle foreign investors have fled. Fourth, eurozone periphery countries have moved decisively from current account deficits to surpluses; they no longer rely on capital from overseas. All four supporting factors will remain in place even as the Fed tapers. None, however, apply to France. Instead other reasons explain the impressive performance of France’s bond market this year – and why it might now be vulnerable. Higher bond yields When the Fed was ramping up its asset purchases and US Treasury yields were falling, global investors looking for higher returns were attracted by France’s large and liquid bond markets. Until June this year, French 10-year yields were higher than US equivalents. France was considered part of the eurozone’s safe, northern core, which made it attractive to investors for whom German Bund yields were simply too low. The Swiss central bank was an avid buyer of French bonds, as were Japanese banks.

The case against France is that if the Fed slows its asset purchases and US Treasury yields rise, those inflows could start to reverse and French bonds would sell off – perhaps sharply. Eric Chaney, chief economist at Axa, points out the very different debt profile between France and Germany. As a share of GDP, French public sector debt will soon be 20 percentage points higher than Germany’s. Without action to alter France’s debt dynamics, the spread between French and German bonds could widen by 50 or 100 basis points, warns Mr Chaney. French politicians probably need not worry just yet. Investors shorting French bonds have often lost their berets. When French yields have hit instability in the past, it has been because of obvious systemic risks – the exposure of its banks to the eurozone “periphery” economies in 2011, for example. Whatever the risks posed by Fed tapering, it is hard right now to see what might trigger another big sell off. As the eurozone crisis has lost intensity, eurozone bonds have performed more like “rates” markets, with yields linked to growth and inflation prospects, rather than default risks. France’s economy is contracting, which will curb any uptick in yields. Still, as Fed tapering draws near, markets may make life less comfortable for French politicians – and limit their bond yield bragging possibilities.

Gapping up

In reaction to strong earnings/guidance: STV +9.2%, LZB +8.5% (also increased its quarterly dividend by 50% to $0.06 per share), JCP +5.4%, DE +3.7%, ADT +0.9%, (also enters into accelerated share repurchase agreement to repurchase ~400 mln of common stock).

M&A news: TEVA +1.6% (Bloomberg discusses merger possibility between Teva and Mylan or VRX, according to reports; upgraded to Positive from Neutral at Susquehanna).

Select oil/gas related names showing strength: SD +4.5%, RDS.A +0.8%, BP +0.7%, .

Select solar names showing strength: RSOL +10.8%, SPWR +4.3%, JKS +3.4%, TSL +3%, YGE +2.2%, SOL +1.6%, .

Other news: IPCI +21.2% (continued strength), HNR +19.5% (announces revised $400 mln proposal from Pluspetrol for co's interest in Venezuela; termination of negotiations with Vitol), UNIS +17.9% (attributed to reports of deal with Hikma), BMRN +4.9% (confirms FDA Advisory Commitee recommends approval for Vimizim for the treatment of patients with Morquio A syndrome), MDR +4.4% (ticking higher, subsidiaries was awarded project for a customer in the Arabian Gulf. The value is approximately US$ 200 million and will be included in McDermott's fourth quarter 2013 backlog), VEEV +4.3% ( following positive Mad Money mention), OMER +4.1% (announces FDA acceptance of Omidria as proprietary name for OMS302), OTIV +3.3% (Silk & Sons disclosed stake), YHOO +3.1% (increases share buyback authorization by $5 bln), NQ +2.9% (following conference yesterday), NOK +2.6% and ALU +1.3% (still checking), RYAAY +2.3% / ZNH +1.1% (still checking), ARO +2% ( Hirzel Capital disclosed stake), BSX +1.2% (receives FDA clearance and CE Mark approval for Direxion Torqueable Microcatheter), SSYS +1.2% (continued momentum), HLF +0.8% (William P. Stiritz, Chairman of Post Foods (POST), disclosed 6.38% active stake in 13D filing; plans to interact with Company management), CRM +0.7% ( following positive Mad Money mention), CAT +0.6% (following DE results), ZNGA +0.5% (picked up in afternoon trade on reports that the co received favorable patent verdict in Texas case), AMGN +0.5% (announces evolocumab (AMG 145) results from first 52-week study of PCSK9 inhibitor to reduce LDL cholesterol; Amgen tgt to $142 from $138 at Deutsche Bank), FNF +0.4% (Dan Loeb's Third Point Capital reported new stakes (as of 9/30) in FNF (2.1 mln shares) and NLSN (1.0 mln) in an amended 13F filing out last night after the close).

Analyst comments: COG +2.1% (upgraded to Outperform from Market Perform at Bernstein ), PCLN +1.8% (added to Conviction Buy list at Goldman), BBY +1.6% (upgraded to Buy from Neutral at Citigroup), PSO +1.4% (ticking higher, upgraded to Buy from Neutral at BofA), GMCR +1.3% ( initiated with a Buy at Buckingham Research).

*LIBERTY GLOBAL SAYS COMBINING WITH ZIGGO MAKES LONG-TERM SENSE

Link to transaltion {http://bit.ly/18nt75J} Link to french article {http://bit.ly/1aR1jmA}

PSA Peugeot family agrees to continue discussions with Dongfeng

Talks between PSA Peugeot Citroen and Dongfeng Chinese group for an input of the latter capital manufacturer automotive French will be able to continue - it's one of the options for saving PSA medium term. According to Les Echos on Wednesday, November 20, a special supervisory board of French society, met Monday endorsed the continuation of initiated by the management with the Chinese manufacturer negotiations. The Monde.fr is pleased to offer reading this article usually reserved for subscribers Monde.fr. Enjoy all items reserved for the Monde.fr you subscribe from 1 € / month | Discover edition subscribers

This means that the family Peugeot , rumors say deeply divided in recent weeks, agreed at this stage to open the group's capital to the constructor of Wuhan and the French State, as also mentioned the Reuters.

According to the assumptions its studied PSA would launch a capital increase subscribed equally by Dongfeng and state. It would, according to confirmed information in the world, a total of 4 billion euros. This would double the current share capital.

In exchange for this contribution, Dongfeng and each state would get 30% share of the French manufacturer. The Peugeot family, which currently owns a quarter of the shares, but 38% of the voting rights, would share in the capital of the company returned around 12.5% ​​if it does not participate in the capital increase.

Although she handed the pot, the family would lose anyway group management. Today, Thierry Peugeot who presides over a company that is over two hundred years in the family fold. "We're not there yet, said a source.'s Peugeot have agreed to formalize strategic discussions with Dongfeng, but nothing is yet done, nor signed. "

But PSA is now at an impasse. It is too small, too general and too focused on Europe . He risk of being in the medium term, distanced by Toyota, General Motors, Volkswagen, Renault -Nissan and Hyundai or Fiat-Chrysler groups that accelerate their investments.

The French manufacturer is pressed for time. If reduced its losses quarter after quarter, the debt grows and its credit rating, which weighs on the borrowing requirements of the bank deteriorates. It also needs in the medium term, an injection of cash to make its technology investments. And it is precisely because the Peugeot family begins to understand the strategic stalemate in PSA is she decided to jump on it.

"INEVITABLE"

Yet all was not as easy, it seems, in recent weeks. Some have even been ready, according to a source, sabotage negotiations with Dongfeng to remain at the head of the company or to make from Philippe Varin, Chairman of the Board.

"This attitude was suicidal, according to one expert group. It took time, but the family eventually understand that opening capital partner is inevitable. "Also, remember a source close to Peugeot," they can have significant disagreements internally, they always end up finding a common position. "

Besides family, PSA management must still convince Dongfeng s' engage quickly. However, it does not seem rushed. The Chinese group, for its part, does not have a knife to her throat. It seeks an industrial agreement to develop its own brand. The French manufacturer has its counterpart access to some of its technologies and common development in the region Asia Pacific . PSA particular facilitate the deployment of the input range of Dongfeng brand in Asia.

Limit the entry strategy of the Chinese capital group PSA is that it does not allow him to see his volumes of cars increased significantly because he wants to significant economies of scale.

Dan Loeb's Third Point Capital reported new stakes (as of 9/30) in FNF (2.1 mln shares) and NLSN (1.0 mln) in an amended 13F filing out last night after the close

Deere beats by $0.22, reports revs in-line; guides Q1 sales above consensus; guides FY14 net income above consensus, sales below consensus

Reports Q4 (Oct) earnings of $2.11 per share, $0.22 better than the Capital IQ Consensus Estimate of $1.89; total net sales fell 4.7% year/year to $8.62 bln vs the $8.68 bln consensus. The profit improvement for the quarter was due primarily to the impact of price realization [lower effective tax rate also helped EPS), partially offset by the unfavorable effects of FX, lower shipment volumes and a less favorable product mix.

Sales included price realization of 4% for the quarter and 3% for the year and an unfavorable currency-translation effect of 2% for the quarter and 1% for the year. Equipment net sales in the United States and Canada decreased 6% for the quarter and increased 5% for the year. Outside the U.S. and Canada, net sales decreased 2% for the quarter and increased 4% for the year, with unfavorable currency-translation effects of 4% and 3% for these periods.

Co issues upside guidance for Q1, sees Q1 equipment sales -2% to ~$6.66 bln vs. $6.53 bln Capital IQ Consensus.

Co issues guidance for FY14, sees FY14 net income ~$3.3 bln vs. the $3.08 bln consensus; sees equipment sales -3% to ~$33.95 bln vs. $34.29 bln Capital IQ Consensus. For fiscal 2014, net income attributable to Deere & Company is anticipated to be about $3.3 billion. The outlook contemplates the sale of 60% of John Deere Landscapes operations, as previously announced. Supported by record 2013 performance, John Deere remains in a prime position to carry out its wide-ranging growth plans and attract new customers throughout the world.

Early premarket gappers

Gapping up: IPCI +21.2%, HNR +19.5%, STV +9.2%, LZB +8.5%, BMRN +4.9%, VEEV +4.3%, SPWR +4.3%, JKS +3.4%, OTIV +3.3%, YHOO +3.1%, TSL +3%, NQ +2.9%, NOK +2.6%, RYAAY +2.3%, ARO +2%, SOL +1.6%, BSX +1.2%, SSYS +1.2%, ZNH +1.1%, HLF +0.8%, CRM +0.7%

Gapping down: CHLN -15.8%, AEZS -8.2%, QUNR -5.8%, SSW -5.7%, LOV -4.2%, GFI -4.2%, LOW -3.8%, CRNT -3.4%, MODN -3%, GOOD -2.4%, NHI -1.8%, TEF -1.3%, BUD -1.1%, GPK -0.9%, SPLS -0.9%

*GERMAN CARTEL OFFICE WANTS REFERRAL OF E-PLUS CASE KPN taking a hit

Lowe's misses by $0.01, beats on revs; raises FY14 EPS below consensus, raises FY14 revs above consensus; Q3 comps +6.2%; sees FY13 comps +5%

Reports Q3 (Oct) earnings of $0.47 per share, $0.01 worse than the Capital IQ Consensus Estimate of $0.48; revenues rose 7.3% year/year to $12.96 bln vs the $12.72 bln consensus.

Sales for the quarter increased 7.3 percent to $13.0 billion from $12.1 billion in the third quarter of 2012, and comparable sales for the quarter increased 6.2 percent.

Co issues guidance for FY14, raises EPS to ~$2.15 from prior guidance of $2.10 vs. $2.19 Capital IQ Consensus Estimate; sees FY14 revs to ~6% from prior guidance of +5% calc to ~$53.55 bln vs. $53.09 bln Capital IQ Consensus Estimate. FY13 Outlook Details: Comparable sales are expected to increase approximately 5 percent. The company expects to open 9 stores in fiscal year 2013. Earnings before interest and taxes as a percentage of sales (operating margin) are expected to increase approximately 75 basis points.

"I am pleased we delivered another solid quarter driven by balanced performance...This balanced performance resulted from our improved collaboration and execution within a strengthening home improvement market, combined with our employees' hard work and continued dedication to serving customers."