>>> Asian Update

Asia Mid-Session Market Update: Broad dollar weakness ahead of Fed's Yellen; BOJ raises purchases of 3-5 yr bonds

***Asia Summary***
- Equities markets remained mixed in the session. USD/JPY fell 0.4% and EUR/USD rose to the highest level since May of 2016 above $1.1480, as markets shift focus to US Fed Yellen’s testimony later today and the expected move from Bank of Canada on interest rates. Yellen is not expected to give any fresh insight, but markets remain wary after Brainard’s comments saying Fed should move cautiously on further rate increases to help boost inflation back to 2% target. Crude rose higher after API data has a larger than expected drawdown.The Bank of Japan (BOJ) raised purchases of 3-5 yr bonds to ¥330B from ¥300B and left others unchanged. JGB 10-yr rate held around 0.09%.

- Chinese and Hong Kong banks rose again for the second day after the PBOC injected funds through OMO for the second day after an extended stretch of no action. Offshore yuan rose 0.2% to 6.7880. Financial press explored that the USD/CNY has settled lower than its daily fix in the last 25 of 29 trading days and the PBOC suspected intervention to prop up the yuan, and its inclusion of a "counter-cyclical" adjustment factor to the daily fix, hasn’t appeared to shift expectations with the currency’s weaker settlement continuing into July. In other Chinese press the Hong Kong China bond connect is being called a success.

***Key economic data***
- (JP) JAPAN JUN PPI M/M: 0.0% V 0.0%E; Y/Y: 2.1% V 2.0%E
- (AU) AUSTRALIA JUL WESTPAC CONSUMER CONFIDENCE INDEX: 96.6 V 96.2 PRIOR, M/M: +0.4% V -1.8% V -1.1% PRIOR (1st increase in 3 months, 8th consecutive month below 100)
- (KR) South Korea Jun Unemployment Rate: 3.8% v 3.7%e

***Speakers and Press***
China
- (CN) China's National Audit Office found improprieties in the 2015 financial statements of 18 out of 20 state enterprises investigated amid the government's anti-graft campaign - Nikkei
Japan
- (JP) Bank of Japan (BOJ) raises purchases of 3-5 yr bonds to ¥330B from ¥300B; leaves others unchanged
Australia/New Zealand
- (AU) ANZ analysts comment that Australia Q2 CPI will likely show that rates will remain on hold
Korea
- (KR) South Korea presidential official: South Korea's new govt will seek both growth and fairer wealth distribution under the main theme of "good growth"
US
- (US) Fed’s Mester (hawkish, non-voter): Reversing QE sooner rather than later is preferable
- (US) Donald Trump Jr: Did not tell President Trump about his meeting with Russian lawyer last year - Fox interview

***Asian Equity Indices/Futures (00:30ET)***
- Nikkei -0.6%, Hang Seng +0.9%, Shanghai Composite -0.2%, ASX200 0.8%, Kospi -0.1%
- Equity Futures: S&P500 -0.1%; Nasdaq flat, Dax -0.1%, FTSE100 -0.2%

***FX ranges/Commodities/Fixed Income (00:30ET)***
- EUR 1.1487-1.1462; JPY 113.96-113.31; AUD 0.7664-0.7635; NZD 0.7240-0.7216
- Aug Gold +0.4% at 1,219/oz; Aug Crude Oil +1.6% at $44.76/brl; Sept Copper +0.3% at $2.68/lb
- USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT 6.7868 V 6.7983 PRIOR
- (CN) PBoC injects combined CNY70B v CNY40B prior in 7-day and 14-day reverse repos
- (CN) China MoF sells 2-yr bonds at 3.4552% and 5-yr bonds at 3.47%

***Asia equities notable movers***
Australia
- Royal Wolf Holdings , RWH.AU Affirms received offer from GFC for A$1.83/shr (40.8% premium) in cash less the amount of the special dividend of A$0.0265; +38.5%
- Adairs Ltd,ADH.AU Guides FY17 results at the upper end of range EPS A$0.11-0.13; EBIT A$30.5-31.0M (prior A$27-32M); Rev A$264.9M (prior A$255-265M); +34.7%

Hong Kong/China
- Singamas Container Holdings, 716.HK Announces continued pledge of shares by controlling shareholder; -4%
- China Vanke,000002.CN Denies press report that it signed contract with Xiongan area; +5.4%

Korea
- Kolon Life Science, 102940.KR Receives approval to sell INVOSSA in South Korea; -10.8%

***US Session Highlights***
- Investors tried to assess two speeches from Fed officials and the impact of evidence that Donald Trump Jr. made contact with purported Russian govt officials who sought to influence the 2016 campaign.
-(UK) BoE Deputy Governor Ben Broadbent in a speech today made no mention about his views on interest rates, giving way to the interpretation he sees no need to make any changes anytime soon. The Pound dropped against all major currencies, reaching an 8-month low against the Euro at 0.8933, and against the US dollar the Pound lost nearly 100 pips from its day high, trading as low as 1.2829 at one point.
-HCSG Reports Q2 $0.30 v $0.29e, Rev $470.9M v $423Me; +7.0% afterhours

***US markets on close: Dow flat, S&P500 -0.1%, Nasdaq +0.3%, Russell +0.3% ***
- Best Sector in S&P500: Energy
- Worst Sector in S&P500: Financial
- Biggest gainers: MU +2.9%; MNK +2.8%; WDC +2.8%
- Biggest losers: KORS -7.4%; CMG -2.8%; TROW -2.5%
- At the close: VIX 10.89 (-0.22pts); Treasuries: 2-yr 1.38% (0.9%), 10-yr 2.36% (-0.4%), 30-yr 2.92% (0.0%)

>>> US After Hours Summary: COHU +9% and HCSG +4% following earnings/g

After Hours Summary: COHU +9% and HCSG +4% following earnings/guidance... oil/gas names higher following API data
After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: COHU +8.8% (raises Q2 revenue guidance), HCSG +3.9% (also declared quarterly cash dividend of $0.18875/share, up from prior $0.1875/share)

Companies trading higher in after hours in reaction to news: CLNT +15.6% (launched global bike sharing app service that joins local sharing bike operators in Hong Kong), TAHO +4.2% (extending today's rebound -- down ~40% month-to-date), IDSY +3.4% (thinly traded; to acquire substantially all of the assets of electronics manufacturer/marketer Keytroller; proposes underwritten public offering), VSTM +2% (appoints Julie Feder as CFO; Feder joins from the Clinton Health Access Initiative), VBIV +1.6% (announces plans for Ph 3 clinical program for Sci-B-Vac following positive discussions with the FDA, EMA and Health Canada), UAL +1.2% (reports June traffic and updates Q2 expectations), AAL +0.8% (UAL sympathy), XCRA +0.7% (COHU sympathy)

Oil/gas names are higher on light volume following API data: SND +4.7%, NFX +3.4%, NRG +3.1% (also announced plans to hold call tomorrow July 12 at 8:30am ET to provide the results of its business review and detailed plan to transform the company), WLL +2.6%, CLR +2.5%, SLCA +1.9%, HCLP +1.6%, MRO +1.6%, CHK +1.5%, DVN +1.5%, APA +1.5%, SM +1.4%, MUR +1.3%, APC +1.1%, SN +1.1%, HES +1.0%, COP +0.8%

After Hours Losers:

Companies trading lower in after hours in reaction to news: OCUL -32.9% (receives Complete Response Letter from FDA for DEXTENZA NDA; company believes that DEXTENZA can be approved open manufacturing items are resolved), ALDR -10.7% (commences 12.5 mln share common stock offering), ARNA -2.1% (to offer/sell $150.0 million of shares of common stock in an underwritten public offering), KIN -1.3% (proposed public offering of its common stock), KORS -0.3% (continued weakness)

>>> US Close Dow +0,00% S&P -0,08% Nasdaq +0.27% Russell +0.33%

Closing Market Summary: Averages Settle Tuesday Mixed

The S&P 500 gave back its slim Monday advance in the second session of the week, dropping 0.1%, with nine of its eleven sectors settling in negative territory. Meanwhile, the Nasdaq (+0.3%) cruised to its second win of the week as technology stocks outperformed and the Dow (unch) eked out a very narrow victory.

With the week's first major event--Wednesday's testimony from Fed Chair Janet Yellen--on the horizon, investors were cautious at the start of Tuesday's session, leaving the S&P 500 near its unchanged mark for the majority of the morning. However, the benchmark index made a sharp move into the red around 11:00 ET, dropping as low as 0.6% below its flat line, after Donald Trump Jr. tweeted an email exchange that involved him setting up a meeting with a Russian lawyer in an attempt to gain some possibly incriminating information on then-presidential candidate Hillary Clinton.

The market's initial reaction was likely prompted by the notion that there might have been collusion between Russia and the Trump campaign to influence the outcome of the U.S. presidential election. However, the risk-off sentiment didn't stick and the benchmark index quickly rebounded, retracing about half of its loss in just 30 minutes.

Outside of the equity market, safe-haven assets like U.S. Treasuries, gold, and the Japanese yen did move modestly higher on Tuesday, but the CBOE Volatility Index (VIX 10.91, -0.20)--which points to the market's anticipation of short-term uncertainty--declined by 1.8%. Gold climbed 0.2% to $1,215.90/ozt, the yen added 0.2% against the U.S. dollar, and the benchmark 10-yr yield--which moves inversely to the price of the 10-yr Treasury note--dropped one basis point to 2.36%.

Only the energy and technology sectors finished Tuesday in the green with energy (+0.5%) being the top-performing group, thanks in large part to crude oil's positive performance. The commodity jumped 1.5% to $45.07/bbl despite trading around 1.0% below its Monday closing price in early-morning action. It's tough to credit a single bullish catalyst for crude oil's advance as technical forces have been coming into play within the crude futures market as of late, but it's worth noting that a European inventory report showed a decline in European product stockpiles.

Meanwhile, the top-weighted technology sector (+0.4%) put together another solid performance, extending its two-day gain to 1.2%, with Facebook (FB 155.27, +1.77) showing relative strength. FB shares jumped to a new session high after the company announced that ads for Facebook Messenger will become available to advertisers globally. Chipmakers also outperformed, pushing the PHLX Semiconductor Index higher by 0.8%.

On the downside, the influential financial sector (-0.7%) struggled on Tuesday, especially following the release of Donald Trump Jr.'s email exchange, and eventually settled with the telecom services group (-0.7%) at the very bottom of the day's leaderboard. However, Dow component Goldman Sachs (GS 226.95, +1.11) was able to register its second win of the week, climbing 0.5%. 

In Washington, Senate Majority Leader Mitch McConnell announced that the upper house will delay its August recess by two weeks, giving Senate Republicans some extra time to iron out their version of the health care reform bill. The health care sector (-0.1%) finished in line with the broader market.

Reviewing today's economic data, which was limited to May Wholesale Inventories and May JOLTS:

  • May Wholesale Inventories increased 0.4% (Blconsensus +0.3%). The prior month's reading was revised to -0.4% from -0.5%.
    • The market doesn't typically pay much attention to this release since the full business inventories report is usually released a short time later.
  • The May Job Openings and Labor Turnover Survey showed that job openings decreased to 5.666 million from a revised 5.967 million (from 6.044 million) in April.

On Wednesday, investors will receive the weekly MBA Mortgage Applications Index and the Fed's Beige Book for July. The two reports will be released at 7:00 ET and 14:00 ET, respectively. 

>>> Direct Energie (DIREN FP) - Launches €100-130M capital increase mainly for t

Launches €100-130M capital increase mainly for the purpose of financing of the Quadran acquisition 
- Following the announcement, on 15 June 2017, of the project to acquire the French renewable energy producer Quadran, Direct Energie launches today a capital increase without preferential subscription rights by way of a private placement. The gross proceeds of the share capital increase would amount to approximately EUR100 million. In case of exercise in full of the extension clause, this amount can reach EUR130 million.

WWD : More Changes Coming to Condé Nast as Frustration Grows Under Jim Norton

More Changes Coming to Condé Nast as Frustration Grows Under Jim Norton
The changes follow a larger reorganization instilled by Norton earlier this year.

Despite a relatively quiet summer filled with rosé-fueled long weekends in the Hamptons, there’s growing unrest in the corridors of Condé Nast. Following a fairly sizable reorganization at the hands of Jim Norton, the new chief business officer and president of revenue, there are rumors that another restructuring is on the way.

Although tweaks are common following foundational changes, there is said to be growing frustration around Norton, who occupies a position with a high turnover rate. (In previous years, a version of his role was held by Richard Beckman, Lou Cona and Edward Menicheschi, all of whom subsequently departed the company.)

Sources told WWD that Norton’s knowledge of the business — that being one steeped in fashion, beauty and luxury — is lacking, which is problematic. Providing further grist to the mill are a few “episodes” at company events — the most infamous being Vanity Fair’s Oscar party — during which Norton became a little too exuberant, causing Condé staffers to whisper about the former AOL executive’s future.

Condé Nast did not comment on those rumors, but a spokesman confirmed that more changes would follow Norton’s larger reorganization. He pointed to the executive’s post-reorganization memo, which was circulated to staff in April.

“When we embarked on this journey to transform Condé Nast into a more modern media company able to meet the changing demands of our audiences and clients, we said it would be a process and not a single point in time,” Norton wrote then. “However, today we have reached a major milestone in that process as we go live with our new business structure…Condé Nast One.”

The reorganization changed the original structure of one publisher per magazine title and instituted more of a group-publishing model, in which “chief business officers” would oversee multiple magazines. (The New Yorker and Vogue would retain the old single-publisher model). Certain publishers were also elevated to sell across categories, such as luxury or beauty, and were given the spiffy title of chief industry officer. The changes largely decentralized the advertising selling structure to accommodate a multichannel selling strategy.

Sources have expressed aggravation with that model, however, and have criticized Norton, noting that Condé Nast has yet to land any “meaningful deals” since the changes took effect.

Others noted that Norton, who started late last year, hasn’t been given enough time to execute his plan and that there’s still ample opportunity to right the ship. Although the structure was announced in January, it has only been in place for about four months.

Since April, Norton has alluded to a second round of tweaks in his team meetings and, according to insiders, that will likely translate into a slight shift in power back to the individual magazine brands or to chief business officers from the chief industry officers.

While those moves may help rectify some frustration within the corridors of One World Trade, there are larger concerns at the publishing company related to whether chief executive officer Bob Sauerberg has the right strategy and people in place to lead the company to thrive in this tumultuous environment. Then again, those concerns are far from unique to Condé Nast, and are instead symptomatic of bigger shifts in the media landscape.

NYT : Russian Dirt on Clinton? ‘I Love It,’ Donald Trump Jr. Said

Russian Dirt on Clinton? ‘I Love It,’ Donald Trump Jr. Said / http://nyti.ms/2uN22bg

The June 3, 2016, email sent to Donald Trump Jr. could hardly have been more explicit: One of his father’s former Russian business partners had been contacted by a senior Russian government official and was offering to provide the Trump campaign with dirt on Hillary Clinton.

The documents “would incriminate Hillary and her dealings with Russia and would be very useful to your father,” read the email, written by a trusted intermediary, who added, “This is obviously very high level and sensitive information but is part of Russia and its government’s support for Mr. Trump.”

If the future president’s elder son was surprised or disturbed by the provenance of the promised material — or the notion that it was part of an ongoing effort by the Russian government to aid his father’s campaign — he gave no indication.

He replied within minutes: “If it’s what you say I love it especially later in the summer.”

Four days later, after a flurry of emails, the intermediary wrote back, proposing a meeting in New York on Thursday with a “Russian government attorney.”

Donald Trump Jr. agreed, adding that he would likely bring along “Paul Manafort (campaign boss)” and “my brother-in-law,” Jared Kushner, now one of the president’s closest White House advisers.

On June 9, the Russian lawyer was sitting in the younger Mr. Trump’s office on the 25th floor of Trump Tower, just one level below the office of the future president.

Over the last several days, The New York Times has disclosed the existence of the meeting, whom it involved and what it was about. The story has unfolded as The Times has been able to confirm details of the meetings.

But the email exchanges, which were reviewed by The Times, offer a detailed unspooling of how the meeting with the Kremlin-connected Russian lawyer, Natalia Veselnitskaya, came about — and just how eager Donald J. Trump was to accept what he was explicitly told was the Russian government’s help.

The Justice Department, as well as the House and Senate Intelligence Committees, is examining whether any of President Trump’s associates colluded with the Russian government to disrupt last year’s election. American intelligence agencies have determined that the Russian government tried to sway the election in favor of Mr. Trump.

The precise nature of the promised damaging information about Mrs. Clinton is unclear, and there is no evidence to suggest that it was related to Russian-government computer hacking that led to the release of thousands of Democratic National Committee emails. But in recent days, accounts by some of the central organizers of the meeting, including Donald Trump Jr., have evolved or have been contradicted by the written email records.

On Monday, Donald Trump Jr. said on Twitter that it was hardly unusual to take information on an opponent. And on Tuesday morning, he tweeted, “Media & Dems are extremely invested in the Russia story. If this nonsense meeting is all they have after a yr, I understand the desperation!”

The back story to the June 9 meeting involves an eclectic cast of characters the Trump family knew from its business dealings in Moscow.

The initial email outreach came from Rob Goldstone, a British-born former tabloid reporter and entertainment publicist who first met the future president when the Trump Organization was attempting to do business in Russia.

In the June 3 email, Mr. Goldstone told Donald J. Trump Jr. that he was writing on behalf of a mutual friend, one of Russia’s biggest pop music stars, Emin Agalarov. Emin, who professionally uses his first name only, is the son of Aras Agalarov, a real estate tycoon sometimes called the “Donald Trump of Russia.”

The elder Agalarov boasts close ties to Mr. Putin: his company has won several large state building contracts, and Mr. Putin awarded him the “Order of Honor of the Russian Federation.”

Mr. Agalarov joined with the elder Mr. Trump to bring the Miss Universe contest to Moscow in 2013, and the Trump and Agalarov families grew relatively close.

When Emin released a music video with a theme borrowed from the television show, The Apprentice, Mr. Trump, then the show’s star, made a cameo appearance, delivering his trademark line: “You’re fired!” The elder Mr. Agalarov had also partnered with the Trumps to build a Trump hotel in Moscow, but it has never came to fruition.

“Emin just called and asked me to contact you with something very interesting,” Mr. Goldstone wrote in the email. “The Crown prosecutor of Russia met with his father Aras this morning and in their meeting offered to provide the Trump campaign with some official documents and information that would incriminate Hillary and her dealings with Russia and would be very useful to your father.”

He added, “What do you think is the best way to handle this information and would you be able to speak to Emin about it directly?”

There is no such title as Crown Prosecutor in Russia – the Crown Prosecution Service is a British term – but the equivalent in Russia is the Prosecutor General of Russia.