>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance:
  • LEDS -19.3%,
  • AIR -10.3%
  • MIK -4.9%, (Michaels Stores to offer for sale 11 mln shares on behalf of selling shareholders, will repurchase 1 mln of those sold; anticipates Q2 results to be in the lower-to-middle range of the previously disclosed guidance)
  • CHSP -4.2%, (lowers Q2 RevPAR guidance but AFFO per share should be near the midpoint of prior guidance; cites slowdown in demand from corporate transient customers)
  • ANGO -3.6%
M&A news:
  • FANG -2.7% (to acquire leasehold interests and related assets in the Southern Delaware Basin, launches underwritten public offering of 5.5 mln shares of its common stock)
Other news:
  • GWPH -5.2% (prices offering of 2.8 mln ADSs, representing 33.6 mln ordinary shares of GW, at $90.00 per ADS)
  • ABBV -1.5% (likely attributed to Amgen's FDA Advisory Committee for Biosimilar to Humira)
  • SBUX -1.4% (pulling back following strength yesterday)
Analyst comments:
  • YELP -2.5% (downgraded to Underperform from Market Perform at Wells Fargo)
  • MWA -2.1% (downgraded to Neutral from Outperform at Boenning & Scattergood)
  • PBR -1.9% (downgraded to Underweight from Equal Weight at Barclays)
  • HST -0.9% (downgraded to Underweight from Neutral at JP Morgan)
  • RAIL -0.8% (downgraded to Hold from Buy at Stifel)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance:
  • ADTN +6.4%
  • TEVA +5.3%, (raises Q2 revs, EPS guidance ahead of next week's full release )
M&A news:
  • IMPR +32.8% (to be acquired by Thoma Bravo for $19.25 per share in cash)
  • GNC +6.3% (renewed M&A speculation circulates)
  • GG +1.7% (Kaminak received securityholder approval of acquisition by Goldcorp)
Select metals/mining stocks trading higher: SBGL +4.4%, MT +3.6%, AG +3%, AG +2.9%, BBL +2.8%, ABX +2.8%,ABX +2.6%, AKS +2.6%, GFI +2.5%, HMY +2.3%, BHP +2.1%, SLW +2.1%, RIO +1.9%, GDX +1.8%, CLF +1.8%, GOLD+1.7%, NEM +1.7%, SLV +1.6%, NEM +1.5%

Other news:
  • JUNO +23.1% (to resume JCAR015 Phase II ROCKET trial after FDA removes clinical hold)
  • KITE +7.5% (JUNO sympathy)
  • GORO +7.1% (reports prelim production results for the second quarter ended June 30 of ~10,011 ounces of gold, 572,500 ounces of silver and significant base metals; maintains its 2016 Annual Outlook)
  • NOK +4.8% (Nokia and Samsung (SSNLF) expand patent cross license agreement; Nokia expects a positive impact to the net sales starting Q3)
  • JBLU +2.7% (reported its preliminary traffic results for June 2016. Traffic in June increased 11.6% from June 2015, on a capacity increase of 10.5%)
  • ORN +1.3% (commercial concrete segment TAS Commercial Concrete was recently awarded $21 mln contract )
Analyst comments:
  • P +4.8% (upgraded to Overweight from Neutral at Piper Jaffray)
  • REN +4.3% (upgraded to Equal Weight from Underweight at Barclays)
  • WLL +3.2% (upgraded to Outperform from Neutral at Credit Suisse)
  • OAS +2.5% (upgraded to Buy from Neutral at Ladenburg Thalmann)

>>> US Early premarket gappers

Early premarket gappers
Gapping up: JUNO +27.2%, CDTI +10.2%, KITE +9.3%, NOK +5.9%, MT +3.9%, SDRL +3.4%, AV +2.9%, SBGL +2.9%, BBL +2.8%, WLL +2.8%, CRH +2.7%, BHP +2.3%, ABX +2.1%, AG +2.1%,AKS +2%, GOLD +2%, RIO +1.9%, DB +1.8%, NEM +1.5%, TWER +1.4%, BBVA +1.4%, CELG +1.3%, GG +1.3%, GDX +1.2%, SLV +1%, SAN +1%, FNFG +0.8%, RDS.A +0.8%, ADTN +0.6%

Gapping down: LEDS -17%, AIR -10.3%, GWPH -5.3%, MIK -4.8%, CHSP -4.2%, ANGO -3.6%, YELP -2.5%, TEVA -2.4%, CHK -2.2%, PBR -1%, RIG -0.9%, ABBV -0.8%, STX -0.6%

(ZeroHEdge) The "Mystery" Of Who Is Pushing Stocks To All Time Highs Has Been So

The "Mystery" Of Who Is Pushing Stocks To All Time Highs Has Been Solved


One conundrum stumping investors in recent months has been how, with investors pulling money out of equity funds (at last check for 17 consecutive weeks) at a pace that suggests a full-on flight to safety, as can be seen in the chart below which shows record fund outflows in the first half of the year - the fastest pace of withdrawals for any first half on record...

... are these same markets trading at all time highs? We now have the answer.
Recall at the end of January when global markets were keeling over, that Citi's Matt King showedthat despite aggressive attempts by the ECB and BOJ to inject constant central bank liquidity into the gunfible global markets, it was the EM drain via reserve liquidations, that was causing a shock to the system, as net liquidity was being withdrawn, and in the process stocks were sliding.


Fast forward six months when Matt King reports that "many clients have been asking for an update of our usual central bank liquidity metrics."
What the update reveals is "a surge in net global central bank asset purchases to their highest since 2013."
And just like that the mystery of who has been buying stocks as everyone else has been selling has been revealed.
But wait, there's more because as King suggests "credit and equities should rally even more strongly than they have done already."
More observations from King:


The underlying drivers are an acceleration in the pace of ECB and BoJ purchases, coupled with a reversal in the previous decline of EMFX reserves. Other indicators also point to the potential for a further squeeze in global risk assets: a broadening out of mutual fund inflows from IG to HY, EM and equities; the second lowest level of positions in our credit survey (after February) since 2008; and prospects of further stimulus from the BoE and perhaps the BoJ.
His conclusion:


While we remain deeply skeptical of the durability of such a policy-induced rally, unless there is a follow-through in terms of fundamentals, and in credit had already started to emphasize relative value over absolute, we suspect those with bearish longer-term inclinations may nevertheless feel now is not the time to position for them.
And some words of consolation for those who find themselves once again fighting not just the Fed but all central banks:


The problems investors face are those we have referred to many times: markets being driven more by momentum than by value, and most negatives being extremely long-term in nature (the need for deleveraging; political trends towards deglobalization; a steady erosion of confidence in central banks). Against these, the combination of UK political fudge (and perhaps Italian tiramisu), a lack of near-term catalysts, and overwhelming central bank liquidity risks proving overwhelming – albeit only temporarily.
Why have central banks now completely turned their backs on the long-run just to provide some further near-term comfort? Simple: as Keynes said, in the long-run we are all dead.

>>> Street Pre-Market Indications

ML
* UNICREDIT - Offer of up to 10% of Bank Pekao; MS/Citi/UBS/UniCredit CIB....
POUNDLAND - Steinhoff agrees to buy the rest of the co for 220p/shr cash.+12%
ACCOR - HotelInvest to become subsidiary. CEO gave little financial detail+3%
BARRATTS - FY inline with PBT +20% to £680m & vols +5.3% in the yr........+3%
BURBERRY - Q1 slightly ahead with rev +4% reported. FX guide upgraded.....+2%
AKER - Revs of NOK 7bn 6% ahead of cons, EBITDA 23% beat. Backlog -9% QoQ.+2%
BASIC RESOURCES - Copper +3.2%, Iron Ore +1.7% & BHP +3.2%, RIO +2.6%...+1-2%
NOKIA - Nokia,Samsung expand intellectual property cross license. +VE...+1-2%
KUNGSLEDEN - Profit from prop mgmt +23%, NAV +4%. Expect Brexit to be +ve.+1%
JD WETHERSPOON - 4Q LFL sales +4.0%, slightly better than 3Q at +3.8%.....+1%
CASINO - 2Q sales slight beat -7%, good in LatAm but slowdown in France.+0.5%
ICAP - Good but no upgrades from BAML and no real detail in the numbers...u/c
ALSTOM - Very weak Q1 orders, 15% miss v cons but timing partly to blame..u/c
AIRBUS - D/G risk. Plan on producing just 12 A380s in 2018 v 27 last yr...-1%
FENNER - Inline but net debt increase due to FX. Trading at recent highs..-2%

CS
Accor +3-5% To sell majority stake in HotelInvest Unit: Reuters
Airbus -1-2% Announced a drastic cut in production of its flagship A380
Aker Sol +5% Q2 revs 6.5% ahead, EBITDA 22% beat
Alstom -1-2% Q1 revs 3.5% beat but exceptionally low level of orders
AstraZeneca M/P Resolves Faslodex Patent litigation in US
Barratt Dev +1-2% Expect PTP inline, completions ahead, cautious on London
Burberry -1-2% LFL sales better but guidance a touch soft
Casino +1% Q2 Sales EU 9.97bln est EU 9.83bln
DKSH +2% Net sales growth better, op profit 3.5% ahead
Fenner -1-2% Net debt higher, expects overall outcome for year inline
GVC M/P Q2 was particularly strong, BWIN integration all fine
ICAP +2-3% Electronic markets inline, post trade ahead
JD Wether +1% LFL slightly lower but FY guidance inline
Miners +1% Copper +3.40%, Brent +0.15%, Iron Ore +1.65%, China +0.62%
Oils M/P US API showed Crude inventories +2.2m barrels
Nokia +2-3% Nokia/Samsung expand Intellectual Property licence pact
One Savings +1-2% CS upgrade to NEUTRAL (Positive post Brexit)
Regus M/P CS remove from the SMID FOCUS LIST (Weakness in UK/Europe)
Speedy Hire +3-5% Q1 slightly ahead, sees FY results ahead

>>> What to look at today - 13th of July 2016

Dow +0.66% S&P +0.70% Nasdaq +0.69% Russell +1.33% VIX : 13.55 (VXX 11.93)
US Market Closed Higher again, as investors eyed potential stimulus measures out of the United Kingdom and Japan, risk-on approach still valid, bidding up oil, growth sectors, and beleaguered currencies while selling off safe-haven assets. seven sectors finishing in positive territory. The energy (+2.3%) and materials (+1.9%) sectors finished ahead of the heavily-weighted financial (+1.2%), technology (+1.0%), and industrials (+0.9%) sectors. The defensive-oriented telecom services (-0.3%), health care (-0.5%), and utilities (-1.4%) sectors trailed the action and were the only sectors that lost ground on Tuesday. WTI +4.4% @ $46.74. OPEC's monthly report facilitated some buying interest after the cartel raised its demand outlook for 2016 and 2017. OPEC now estimates that global demand will increase by one million barrels per day by 2017. Separately, Alcoa (AA 10.69, +0.55) boosted the materials (+1.9%) sector after it beat analysts' estimates for the second quarter. Financials followed rebound on European names ahead of JPM Q. numbers on Thursday. volume were in line with average at 952mil shares. US After Hours TEVA +1% following guidance, JUNO +25% on trial resumption news... LEDS -16.3%, AIR -11% , MIK -5.2%, CHSP -4.2% following earnings/guidance. Asian equity markets are in rally-mode yet again, tracking another round of solid gains on Wall St, helped also by a rebound in oil & Gold. In China, investors await economic data for June on Trade Balance, money supply, and New Yuan loans figures during European session. In the mean time, China Premier Li has expressed confidence the economy can achieve annual GDP target of at least 6.5%, noting that Q2 growth maintained steady momentum. Q2 GDP, along with the bulk of June economic figures, will be released early on Friday.

Nikkei +0.96% Hang Seng +0.63% CSI +0.58% Shanghai +0.52%

Eur$ 1.1067 CNH 6.6878 CNY 6.6849 JPY 104.31 GBP 1.3319 CHF 0.9887 RUB$ 63.9885 WTI $ 46.38 (-0.92%)

S&P -0.14% EuroStoxx -0.35% Dax -0.28% SMI -0.01%


Macro :
- Fed’s Bullard Says Brexit to Have ‘Close to Zero’ U.S. Impact
- The Richest Generation in U.S. History Just Keeps Getting Richer
- Fed’s Kashkari Says Fed Can Remain Patient on Raising Rates
- Greece’s Creditors Reject Request to Amend Bank Law: Kathimerini

Keep an eye on :
- ABE SM : Abertis Says Eutelsat Put Option in Hispasat Affected by Accord
- AC FP : Accor to Sell Majority Stake in HotelInvest Unit: Reuters
- AC FP : Accor HotelInvest Split Should Be Taken Positively: Barclays
- AIR FP : Airbus to Cut A380 Aircraft Output to 1/Month in 2018: Tribune
- AKSO NO : Aker Solutions 2Q Sales Beat Ests., Net Income Misses Ests.
- ALO FP : Alstom 1Q Sales Rise 9% Y/y, Maintains 2020 Targets, Alstom 1Q Order Intake Low But Expected, Morgan Stanley Says
- ASML NA : ASML Reaches 3-Day Throughput of 1,400 Wafers/Day on EUV System
- CO FP : Casino 2Q Sales Beat Ests., French Retail Sales In Line
- DUNI SS : Duni 2Q Operating Profit, Sales Beat Estimates
- EDPR PL : EDP Renovaveis 1H Electricity Production Rises 23% Y/y
- FCC SM : FCC Readies Refinancing for Cementos Portland: Cinco Dias
- HSBA LN : HSBC Earnings Estimates Cut at Citigroup on Brexit: Report
- IOC US : Exxon Said to Top Oil Search’s Bid for InterOil: Reuters
- JUNO US : Juno Says FDA Allows Study to Resume; Shares Surge 33% Post-Mkt
- MAIL LI : Mail.ru May Sign License Agreement W/ Universal Music: Vedomosti
- MCD US : McDonald’s Said Struggling to Get Strong Bidders for China: FT
- EGL PL : Mota-Engil Wins Contracts in Africa, Brazil Worth EU380m
- NOKIA FH : Nokia, Samsung Expand Intellectual Property Cross License Pact
- POP SM : Popular Hires Deutsche for EU4B Sale of Real Estate: Expansion
- REP SM : Repsol Pays Lowest Interest on Privately-Placed Debt: Expansion
- SAB LN : Altria May Use SABMiller Stake Sale Proceeds for Div. or M&A: BI
- SAB LN : *ELLIOTT CAPITAL BUILDS 1.3% STAKE IN SABMILLER: TELEGRAPH
- TEVA IT : Teva Prelim. 2Q Adj. EPS, Rev. Beat Estimates; Shares Rise
- UCG IM : UniCredit Signalling Commitment to Dilution Risk Cut: Goldman
- UCG IM : UniCredit Sells 10% Bank Pekao Stake at PLN126/Shr
- VIV FP : Vivendi’s Dailymotion Unit Hit by Departures in Past Year: Echos
- VIV FP : Amazon May Start Video Platform in France This Year: Figaro
- VIV FP : Mail.ru May Sign License Agreement W/ Universal Music: Vedomosti
- VIV FP : Legendary Said to Be Closing on Deal for Pokemon Film: Deadline
- VOW3 GY : Volkswagen Exec in South Korea Indicted in Emissions Case: WSJ

(CS) Global Equity Strategy : Sector Rating Review post Brexit

We review our sector weightings post the Brexit vote to conclude to a) add selectively to domestic UK sectors: We upgrade non-London housebuilders to benchmark, while we stay underweight London-centric plays and UK REITs, especially office. We remain benchmark general retailing, purely on the basis of valuation (a near record 25% P/E discount to the UK market). Elsewhere, we upgrade UK life insurers to overweight from benchmark; b) remain benchmark European cyclicals; c) adjust weightings within defensives: We take the entire European utilities sector to underweight while add this money to big cap pharma.
FULL NOTE