>>> Asian Update

Asia Mid-Session Market Update: Region under pressure as oil declines overnight and clarity on central bank action remains cloudy;

***Economic Data***
- (NZ) NEW ZEALAND Q2 CURRENT ACCOUNT BALANCE (NZ$): -0.95B V -0.3BE
- (NZ) New Zealand Aug REINZ median home price y/y: +6.0% v +8.6% prior; Home sales y/y: -3.1% v -10.1% prior; Home sales: 7.5K v 7.3K prior
- (AU) AUSTRALIA SEPT WESTPAC CONSUMER CONFIDENCE INDEX: 101.4 V 101.0 PRIOR, M/M: 0.3% V +2.0% PRIOR (2nd consecutive increase)
- (JP) JAPAN AUG TOKYO CONDOMINIUM SALES Y/Y: -24.7% V -30.7% PRIOR
- (JP) JAPAN JULY FINAL INDUSTRIAL PRODUCTION M/M: -0.4% V +0.0% PRELIM; Y/Y: -4.2% V -3.8% PRELIM

***Index Snapshot (as of 03:30 GMT)***
- Nikkei225 -0.2%, S&P/ASX -0.5%, Kospi closed, Shanghai Composite -0.6%, Hang Seng -0.2%, Dec S&P500 +0.3%

***Commodities/Fixed Income***
- Dec gold -0.1% at $1,322/oz, Oct crude oil +0.5% at $45.11/brl, Dec copper +0.4% at $2.11/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 0.5%, 4.4 tonnes to 935.5 tonnes; 4th consecutive decline
- (CN) PBOC to inject CNY70B in 7-day reverse repos, CNY30B in 14-day reverse repos and CNY65B in 28-day reverse repos
- (CN) PBOC SETS YUAN MID POINT AT 6.6895 V 6.6726 PRIOR
- (CN) China MoF sells 2-yr bonds at 2.326% v 2.33%e; Sells 5-yr bonds at 2.527% v 2.53%e
- (AU) Australia MoF to sell its first 30-yr bond - AFR

***Market Focal Points/FX***
- Asian equity markets remain under pressure ahead of SNB and BOE interest rate decisions tomorrow, markets seem to be losing faith that global central bank action will help to boost growth and the lack of clarity on when the US Fed will take action continues to cast a long shadow. China data over the last few days also showed the economy is doing well (retail sales +10.6%, industrial production at a 5-month high, FDI +5.7% y/y) which should tamper anticipation of any additional PBoC stimulus, leaving the markets waiting for the first moverChina state researcher Wang Yiming sees the economy reaching bottom in H2 of this year or in 2017.

Crude oil futures stabilized around $45.11, after a sell off (as much as -3%) during US session due to a warning from IEA of slowing demand and a more bearish OPEC report. Weekly API oil inventories were +1.4M v -12.1M prior, reminder prior week was impacted by weather.

Australia saw September consumer confidence rise for the second consecutive month, with AUD/USD hovering just off session highs of 0.7489, but holding to a 30 pip range in the session. USD/JPY tested 103.20 in the wake of a Nikkei report indicating that the BOJ would keep negative rates at the center of any future easing policy. PM Abe said that Japan was on verge to escape deflation; monetary easing to gradually permeate through real economy.

***Equities***
US equities / ADRs:
- HOME: Reports Q2 $0.13 adj v $0.11e, R$188.4M v $183Me; +4.8% after hours
- HLF: Icahn: Herbalife would do better going private; thought about making a tender for HLF, but not likely to do it, though someone else might - Delivering Alpha conf; +2.4% after hours
- MON: Bayer improved offer likely to be announced pre-US open on Sept 14th - financial press; +2.3% after hours
- WFC: CEO Stumpf apologizes for recent scandal, all levels of management feel responsible - CNBC; -0.3% after hours

Notable movers by sector:
- Consumer discretionary: Parkson Retail Group 3368.HK +42.4% (disposal of unit); Ansell ANN.AU +1.2% (guidance); JB Hi-Fi JBH.AU -4.1% (UBS raises to Buy); Tsuruha Holdings 3391.JP -6.6% (Q1 result)
- Financials: CYBG CYB.AU -4.9% (not active in M&A talks); Platinum Asset Management PTM.AU +11.3% (Credit Suisse raised to Neutral); Tokyo Tatemono 8804.JP +3.5% (Haitong International raised to Buy); Resona Holdings 8308.JP -2.2% (Daiwa raised to outperform)
- Industrials: Air China 753.HK -0.4% (Aug result)
- Technology: Tech Pro Technology Development 3823.HK -11.1% (filed bankruptcy proceedings)
- Materials: Whitehaven Coal WHC.AU +3.3% (China buys coking coal at biggest premium)
- Energy: Sundance Energy Australia SEA.AU -1.9% (H1 result)
- Healthcare: Nippon Shinyaku 4516.JP +5.5% (SMBC lifted PT)
- Telecom: BigAir Group BGL.AU +20.8% (acquisition speculation)

>>> US After Hours Summary: HOME +5% following earnings/guidance, HLF


After Hours Summary: HOME +5% following earnings/guidance, HLF +3% on Icahn comments, MON +1% imminent M&A deal announcement expected... RLGT -6% following earnings, LFVN -22% on internal review/delayed earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: HOME +4.8%

Companies trading higher in after hours in reaction to news: SRPT +10.4% (higher in extended trade on chatter that Dr. Ronald Farkas is no longer with the FDA), HLF +2.6% (following Icahn comments at CNBC Delivering Alpha), MON +1% (ongoing M&A speculation -- imminent deal announcement expected - Charles Gasparino says tonight, while Reuters sources say tomorrow)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: RLGT -6.4%,

Companies trading lower in after hours in reaction to news: LFVN -22.3% (to delay the release of its Q4 and FY16 financial results following an internal review by Company personnel of its policies and procedures), AGIO -4.4% (is offering to sell up to $150 mln of its common stock in an underwritten public offering), CALD -2.9% (announces an underwritten public offering of 4 mln shares of common stock), OAS -2.9% (announces offering of $250 mln of senior convertible notes due 2023; commenced tender offers to purchase 7.250% senior notes due 2019, 6.500% senior notes due 2021, 6.875% senior notes due 2022, & 6.875% senior notes due 2023 for aggregate cash consideration of up to $275.0 mln)

>>> US Close Dow-1.41% S&P-1.48% Nasdaq-1.09% Russell-1.90%

Closing Market Summary: Stocks Under Pressure as Rates Rise

The major averages ended the Tuesday affair sharply lower as rising long-term interest rates pressured the broader market. The upswing in interest rates was led by growing uncertainty surrounding the future path and effectiveness of global central bank policy. The S&P 500 (-1.5%) settled behind the Dow Jones Industrial Average (-1.4%) and the Nasdaq Composite (-1.1%).

Equity indices began the session under pressure as investors continued to mull over central bank policy here at home and from overseas. Fed Governor Lael Brainard reaffirmed a dovish stance in the prior session, stating that the case for preemptive tightening has become less compelling. In response, the implied probability of a rate hike at the September meeting fell to 15.0% from 24.0% at the start of the week.

The dovish posture failed to carry over buying interest into today's session as participants responded to mixed performances from global markets and a downturn in crude oil. The energy component was under pressure after the International Energy Agency's monthly report struck a bearish tone. The IEA cut its global demand growth forecast for 2016 to 1.3 million barrels per day (previous: 1.4 million barrels) while the group also trimmed its 2017 growth estimate to 1.2 million barrels (previous: 1.4 million barrels). The negative revisions cast doubt on the potential timetable for an oil market rebalancing.

The benchmark index notched a session low (2120.27) shortly after midday, finishing narrowly above that level. All ten sectors ended in the red with financials (-1.8%), materials (-1.9%), telecom services (-2.0%), and energy (-2.9%) acting as notable laggards. Conversely, technology (-0.6%) and consumer staples (-1.4%) ended with the narrowest losses.

The commodity-sensitive energy sector (-2.9%) ended broadly lower amid a sustained downturn in crude oil. WTI crude finished lower by 3.0% ($44.92/bbl; -$1.37). In the group, oilfield service names underperformed with Baker Hughes (BHI 48.34, -1.36) and Halliburton (HAL 41.11, -1.29) losing 2.8% and 3.0%, respectively. On a side note, the American Petroleum Institute is slated to release its weekly inventory report this evening while the Department of Energy is scheduled to release its more influential inventory report tomorrow at 10:30 ET.

The economically-sensitive financial sector (-1.8%) was under pressure as participants reassessed rate hike expectations for the year. In the group, Wells Fargo (WFC 46.96, -1.58) declined 3.7%. The name has been under pressure since announcing a settlement with the Consumer Financial Protection Bureau last Thursday. The broader sector has declined 2.8% this month and currently sports a year-to-date loss of 0.2%. 

Biotechnology underperformed in the health care space (-1.5%), evidenced by the 1.6% loss in the iShares Nasdaq Biotechnology ETF (IBB 282.62, -4.49). The ETF was under pressure after rallying 3.0% in the prior session. In the ETF, Vertex Pharmaceuticals (VRTX 95.27, -2.59) underperformed after Raymond James issued a "Market Perform" designation on the stock.

The influential technology space (-0.6%) finished ahead of the benchmark index as top-weighted component Apple (AAPL 108.12, +2.68) led. The Dow component rallied 2.6% after T-Mobile (TMUS 45.34, -0.59) and Sprint (S 6.56, -0.36) reported bullish pre-order data for the iPhone 7. The PHLX Semiconductor Index (-0.9%) also finished ahead of the broader market as iPhone suppliers drafted higher on the news. Broadcom (AVGO 165.24, +0.76) and Skyworks (SWKS69.36, +1.02) ended higher by 0.5% and 1.5%, respectively. 

Treasuries ended sharply lower with the long end of the curve demonstrating relative weakness. The yield on the 2-yr note rose two basis points to 0.79% while the yield on the 10-yr note jumped six basis points to 1.72%.

Today's participation was above the recent average as more than one billion shares changed hands on the NYSE floo

Today's economic data was limited to the Treasury Budget for August:

  • The Treasury Budget for August showed a deficit of $107.1 billion versus a deficit of $64.4 billion in August 2015. The Treasury Budget data is not seasonally adjusted, so the August deficit cannot be compared to the $112.8 billion deficit registered in July.
    • Total receipts in August were $231.3 billion while total outlays were $338.4 billion.
    • Receipts were $20.5 billion more than receipts in August 2015. Total outlays, meanwhile, were $63.2 billion more than the same period a year ago.
    • The 12-month deficit widened to $529.9 billion from $487.2 billion in July.

Tomorrow's economic data will include the 7:00 ET release of the weekly MBA Mortgage Index. Meanwhile, Import/Export Prices for August will each cross the wires at 8:30 ET.

  • Russell 2000: +6.8% YTD
  • S&P 500: +4.1% YTD
  • Dow Jones: +3.7% YTD
  • Nasdaq: +3.0% YTD

Les Echos : SFR pourrait écoper d’une lourde amende à Noël

SFR pourrait écoper d’une lourde amende à Noël

L’opérateur mobile propriété de Patrick Drahi pourrait écoper d’une amende assez salée pour avoir pris le contrôle de SFR, via sa société Numericable, avant même d’avoir l’autorisation de le faire.

Pas sûr que les fêtes de Noël soient très joyeuses chez SFR. L'opérateur mobile propriété de Patrick Drahi pourrait écoper d'une amende assez salée pour avoir pris le contrôle de SFR, via sa société Numericable, avant même d'avoir l'autorisation de le faire. Selon nos informations, le montant pourrait atteindre théoriquement jusqu'à 500 millions. Soit la plus lourde amende jamais infligée à un opérateur télécoms par l'Autorité de la concurrence.

L'affaire remonte à l'année 2014. En mars, Patrick Drahi annonce que Numericable a signé un accord de rachat de SFR. Mais, comme toujours dans ce type d'opération, il ne peut pas en prendre le contrôle tout de suite : il doit d'abord obtenir le feu vert de l'Autorité de la concurrence. Cela prend toujours plusieurs mois et donc SFR et Numericable n'ont pas eu le droit de travailler ensemble avant octobre 2014, date effective de la prise de contrôle. Sauf que les équipes de Drahi sont soupçonnées de ne pas avoir attendu cette date...

Beaucoup de preuves

L'Autorité de la concurrence, qui s'est saisie de cette question l'année dernière et est allée jusqu'à perquisitionner les locaux de SFR, vient de remettre son rapport à l'opérateur mobile. Celui-ci est confidentiel mais, selon nos informations, il serait très sévère. « C'est un rapport à charge contre SFR », pointe un acteur du secteur. « Il est rempli d'anecdotes croustillantes. Des mails rendent compte d'instructions données directement par Patrick Drahi. Il y a beaucoup de preuves que Numericable a bien pris le contrôle de SFR avant l'heure », renchérit un autre. La pratique s'appelle le « gun jumping ». En sport, c'est quand l'athlète part avant que l'arbitre ait sifflé le départ... Dans les affaires, c'est formellement interdit.

Le rapport pointerait surtout des pratiques commerciales mises en oeuvre entre SFR et Numericable, à une période où ils n'en avaient pas le droit, et qui témoignent clairement d'un changement stratégique chez SFR. Exemple : le lancement par SFR d'une box TV câblée par Numericable, moins d'un mois après avoir reçu l'aval du gendarme de la concurrence pour la fusion Numericable-SFR. La rapidité avec laquelle elle a été faite en a étonné plus d'un.

Un cas unique en Europe

L'enquête n'est pas terminée. SFR doit maintenant répondre au rapport de l'Autorité de la concurrence. La décision finale est attendue à la fin de l'année. Contactés, ni SFR, ni l'Autorité de la concurrence n'ont fait de commentaire. Si SFR devait être condamné, cela serait une première en Europe. Jamais aucune entreprise n'a été punie pour ce type de pratiques sur le Vieux continent. Aux Etats-Unis, on recense seulement deux cas : l'un concernant Titan Wheel en 1996, l'autre Qualcomm en 2006. A chaque fois cependant, les amendes n'ont pas dépassé quelques millions de dollars.

Une autre affaire similaire pourrait éclabousser Altice, la maison-mère de SFR, qui a racheté Portugal Telecom fin 2014. Cette fois-ci c'est la Commission européenne qui a donné son feu vert au rachat. Mais soupçonnant là encore une prise de contrôle avant l'heure, Bruxelles a également ouvert une enquête.

(Handelsblatt) Linde CFO to Step Down After Failed Praxair Merger

Linde CFO to Step Down After Failed Praxair Merger

German industrial gases company Linde is set to undergo a major shakeup of its leadership after a blockbuster merger with U.S. rival Praxair collapsed this week.
Linde’s chief financial officer, Georg Denoke, will step down with immediate effect, replaced by Sven Schneider, the company announced in a statement Tuesday.
Mr. Denoke had been involved in a smoldering leadership dispute with Chief Executive Wolfgang Büchele at the top of the Munich-based firm, which insiders say may have impacted the merger talks. Mr. Denoke was said to be against the merger and had been accused by many within the company of disloyalty.
Sources said many members of the non-executive supervisory board, which has the power to hire and fire executives in Germany, viewed Mr. Denoke’s role skeptically and wanted him out immediately.
The $60-billion (€53-billion) merger between the world’s second- and third-largest industrial gases firms abruptly collapsed this week, ending Linde’s hopes of regaining the top spot in the industry. The two companies on Monday said the talks stumbled over “governance issues.”
Sources at Linde told Handelsblatt that Praxair had essentially sought to take executive control of the joint company. The role of Linde’s Munich headquarters may also have come into play. Sources said the joint company was to be based in Europe – though not in Germany – while Praxair had sought to run much of the company out of its current headquarters in Connecticut.

>>> House of Lords select committee publishes report on "The Invoking of Article

House of Lords select committee publishes report on "The Invoking of Article 50": says the Executive should not act without consulting Parliament (update) 

"... we consider that there is a strong argument that enacting the result of a referendum of this magnitude should require at least the same level of parliamentary involvement as a decision to authorise a military deployment...It would be constitutionally inappropriate, not to mention setting a disturbing precedent, for the Executive to act on an advisory referendum without explicit parliamentary approval particularly one with such significant long-term consequences. The Government should not trigger Article 50 without consultingParliament."

>>> Novo Nordisk A/S: Adults with type 2 diabetes treated with Xultophy were up

Novo Nordisk A/S: Adults with type 2 diabetes treated with Xultophy were up to 4.5 times more likely to reach glycaemic targets
  • Co presented data showing the odds of reaching fasting plasma glucose (FPG) targets without hypoglycaemia and weight gain were significantly greater for Xultophy compared to up-titration with insulin glargine U100 in adults with type 2 diabetes uncontrolled on insulin glargine U100 (20-50 units).
  • The post-hoc analysis of the DUAL V phase 3b trial was evaluated using a FPG target of 7.2 mmol/L, selected to better reflect targets used in clinical practice.2 Data showed that adults treated with Xultophy were 4.55 times more likely to reach FPG targets without confirmed hypoglycaemia and weight gain vs up-titration with insulin glargine U100