Gapping up
In reaction to strong earnings/guidance:
In reaction to strong earnings/guidance:
- BANC +6.1%, APH +2.8%, HPE +2.5%, ASML +2.4%, STX +2.4%, ADTN +2.2%, YHOO +1.2%, HAL +0.9%, SVU+0.4%, ABT +0.4%
M&A news: GNC +5.7% (has met with a number of Chinese firms in recent weeks about a possible acquisition, according to the WSJ)
Select metals/mining stocks trading higher:
Select metals/mining stocks trading higher:
- SBGL +3.9%, KGC +3.2%, AG +3%, AUY +2.1%, ABX +2%, SLW +2%, NEM +1.8%, GDX +1.7%, HMY +1.5%, SSRI+1.4%, GOLD +1.3%, MT +1.1%
Select oil/gas related names showing strength:
- EPE +3.8%, WLL +2.8%, SDLP +2.3%, SDRL +2.2%, CHK +1.7%, PBR +1.3%
Other news:
- CERU +94.1% (enters into a strategic collaboration with Novartis (NVS); enters $20 million common stock purchase agreement and a registration rights agreement w/ Aspire Capital; Aspire purchased 800K shares of common stock for $1.25/share)
- MRNS +22.3% (announces that its Phase 1 dose-escalation study ganaxolone intravenous achieved dose levels targeted for efficacy in patients with status epilepticus and other indications)
- RLJE +9.3% (thinly traded; AMC Networks shows 79.8% active stake)
- OMER +3.7% (announces 'positive' results from a Phase 2 clinical trial evaluating the effects of a peroxisome proliferator-activated receptor-gamma agonist in patients with cocaine use disorder)
- STLD +1.3% (Steel Dynamics authorized share repurchase program of up to $450 mln of common stock)
- TMH +1.4% (following late move higher on Reuters report that Blackstone is top bidder)
- BLDP +1.4% (light volume; announced the commissioning and deployment of 10 fuel cell-powered buses in the City of Yunfu, in the Province of Guangdong, China)
Analyst comments:
- AMRN +7.7% (initiated with a Buy at Citigroup)
- IAG +2.2% (upgraded to Buy from Hold at Canaccord Genuity)
- OAS +2.2% (upgraded to Overweight from Neutral at Piper Jaffray)
- CANF +2% (resumed with a Buy at ROTH Capital)
- STO +1.4% (upgraded to Reduce from Sell at Handelsbanken)
- BCS +1.2% (upgraded to Buy from Hold at Investec)
- TWTR +0.7% (upgraded to Hold from Sell at Loop Capital)
Gapping down
In reaction to disappointing earnings/guidance:
In reaction to disappointing earnings/guidance:
- VDSI -19.2%, (offers light prelim Q3 results, lowers FY16 guidance), CREE -11.5%, VIVO -11.5%, (sees FY16 and FY17 EPS and revenue below consensus), MANH -8%
- ACHC -7.1%, (signs definitive agreement for sale of U.K. facilities in fulfillment of previously announced undertakings to the CMA; issues downside Q3 prelim results)
- INTC -4.6%, UFPI -3.6%, ISRG -1.6%, RAI -0.6%, IBKR -0.5%, HA -0.5%
M&A news:
- RAD -4.8% (NY Post discusses that Kroger (KR) might push away from deal to purchase stores from Walgreens (WBA) and Rite Aid (RAD) in order for them to complete merger)
Select semi-conductor names showing weakness following NVDA and CREE earnings:
- MU -0.9%, AMD -0.6%, QCOM -0.5%, TXN -0.5%
Other news:
- IMPV -18.8% (seeing headlines that the company's sales process may have stalled over disagreements on price)
- MNTR -13.2% (after 60% move higher on Tuesday)
- SNSS -6.9% ( intends to offer and sell shares of its common stock and Series C Convertible Preferred Stock in underwritten public offerings)
- PBYI -4.7% (commences underwritten public offering of $150 mln of shares of its common stock)
- NKTR -3.6% (prices offering of 13 mln shares of common stock at $13.50 per share)
- ASND -3.3% (announces about a 6.32 mln share underwritten public offering of American Depository Shares priced at $19.00/ADS for net proceeds of about $112 mln), ADI -1.9% (lower with tech names - Linear Tech also released its Q1 results)
- LKSD -1.6% (light volume- announces a strategic agreement that expands its relationship with The United Methodist Publishing House; will provide book fulfillment and distribution services for UMPH)
Analyst comments:
- NCLH -1% (downgraded to Hold from Buy at SunTrust)
Italy grapples with uncertainty of constitutional reform vote
Anti-business sentiment still at the forefront of investors’ minds
At a rally in Milan’s Piazza del Duomo two years ago, Beppe Grillo, leader of Italy’s populist Five Star party, and Dario Fo, the recently deceased Nobel Prize-winning playwright, took aim at Fiat boss Sergio Marchionne. They accused Mr Marchionne — Italy’s largest private employer — of engaging in the “politics of blackmailing workers”, in reference to recent job losses. A chant started of “Marchionne go to hell”. Mr Fo said he “discovered for the first time what it was to be a populist”.
Anti-business sentiment in Italy is still at the forefront of investors’ and business leaders’ minds as the country’s referendum on constitutional reform approaches. Analysts predict that the vote on December 4 could unseat reformist prime minister Matteo Renzi.
Mr Renzi — who wants Italians to vote Yes to the reforms — is neck and neck with opponents led by Mr Grillo. With the outcome uncertain, business is bracing for a shock, particularly after the UK’s unexpected Brexit vote.
Businesses’ main concern is the fallout if Mr Renzi loses. Executives fear it could result in political instability and a hiatus in desperately needed reform, at a time when Italy’s banking sector is fragile.
Pietro Salini, chief executive of Italy’s largest construction group Salini Impregilo, said this month that if the referendum went “the wrong way”, there was “a threat of a large part of industry going elsewhere”.
For Mr Salini, the wrong way is “a way that puts Italy without a government, without the possibility of having new elections, without the possibility of a government that is sufficiently reliable”.
Marco Tronchetti Provera, executive chairman of tyremaker Pirelli, which is owned by ChemChina, says a No vote would mean Italy “would be perceived as a country that does not want to do reforms”. It is a view shared by Rodolfo De Benedetti, chairman of the industrial group CIR which operates in media, healthcare and auto parts, and a supporter of the Yes campaign. He says reform “is the choice between change and conservatism” — although he adds that the possibility of a No vote “is not the end of the world” and “the country will survive with all its opportunities and potential and its problems and challenges”.
Supporters of a No vote have argued — with some vitriol — that business leaders and foreigners have no business “interfering” in the vote of citizens. But this suggests a misunderstanding of how much Italian companies have become vulnerable to foreign investor sentiment.
Just 3 per cent of institutional investors in Milan’s stock exchange are Italian, according to Borsa Italiana. And, while Italian banks have traditionally been the main lenders to Italian companies, foreign credit has become decisive here, too. Of the funds looking at buying some of the €200bn of gross bad loans weighing on the Italian banking sector, most are from overseas. George Muzinich, chairman and chief executive of US corporate credit investor Muzinich & Co, says: “The structural reforms undertaken by the government encouraged us to look favourably on making a long-term investment in Italy.”
Credit rating agency Moody’s has also warned that instability following a No vote would increase the risk of capital increases for Italy’s weakest lenders.
Even so, many executives do not think Mr Renzi’s administration is doing enough. While his first 18 months in office produced significant reforms in banks, labour and administration, it has been less effective since. Investors and executives today complain that reforms were not followed through or properly communicated.
Competitiveness has improved. Last year, Italy climbed nine places in the World Bank’s “Ease of Doing Business” rankings, to 45th place out of 189 countries.
But despite an initial rally in stocks and bonds, investment in Italy’s real economy has not recovered since the financial crisis, according to Eurostat data.
Mr Renzi needs more time, supporters such as Mr Marchionne say. But arguably as significant for Italy is the vote that Mr Marchionne and his investors have already made with their feet. Since that rally in Milan, Fiat Chrysler, Ferrari and Exor, the Agnelli family holding company, have moved their financial and legal headquarters and, in Fiat Chrysler’s case, its primary listing, out of Italy.
The Obama administration’s mega-drugstore merger review has run into another potential roadblock, The Post has learned.
Supermarket giant Kroger is feared to be close to passing on acquiring some the 650 stores that Walgreens and Rite Aid would have to sell to gain regulatory approval of their $17 billion merger, sources said.
Kroger at first expressed interest in buying the stores — becoming the best hope for Walgreens to win Washington’s OK on its deal.
The country’s largest supermarket chain came along after several private equity firms had passed on buying the locations — determining they were too spread out geographically and of not a critical mass to profitably compete, sources said.
But now Kroger may decide not to buy because Obama’s Federal Trade Commission — already a year into its merger review — recently told the supermarket owner that the 650 stores couldn’t be purchased and closed, with the operations moved inside the grocery stores, two sources close to the situation said.
“The FTC is trying to preserve the stand-alone stores,” a source said. “But Kroger might want to integrate. What happens to Rite Aids it buys that are near Krogers?”
Kroger last week met with several hedge funds and said it was still trying to figure out its “special sauce” in expanding Kroger, giving one hedge fund manager the impression that Rite Aid was only one option.
The merger of Walgreens, the No. 2 chain, and Rite Aid, No. 3, would create the country’s biggest drug chain.
Since The Post reported Sept. 27 that PE firms had lost much interest in buying divested stores, Rite Aid’s shares have slid 13 percent, to $7.02, as investors continue to get more concerned about the $9-a-share merger deal.
If no solution is found, the FTC can sue to block the deal.
“A suit is not beyond the realm of possibility,” one source said, adding that both the FTC and Walgreens were still motivated to find a remedy, and as result he was still optimistic.
Morgan Stanley on Oct. 11 wrote a detailed analysis of Kroger’s new store concepts, arguing why its target is $40, 25 percent more than Kroger’s present $30.64 level.
Kroger is growing an urban upscale brand, Mariano’s, a small-box fresh foods format, Main & Vine, and a deep value format, Ruler Foods.
Morgan Stanley believes these three specialty areas that now represent 15 percent of industry sales will grow to 20 percent by 2020.
The upscale brand, Mariano’s, specializes in prepared foods, Morgan Stanley says. It quotes an A.T. Kearney consulting firm study that forecasts 7 percent growth in prepared foods in supermarkets, well above the industry’s 3 percent overall rates.
Kroger did not return calls. The FTC and Walgreens declined comment.
Orders for Saudi’s debut international bond thought to be north of $50bn
Saudi Arabia has closed the book for its first dollar-denominated bond, with early indications suggesting investors have put forward orders north of $50bn.
Both the price and size of the bond sale are due to announced later today, writes Elaine Moore.
Saudi’s debut issue is expected to be split in three maturities of five, 10 and 30 years. Initial price guidance set the yield on the new five-year bond at 160 basis points above US Treasuries, while the 10 and 30 year bonds were offered at a premium of 185 and 235 basis points respectively.
The bond sale is part of a broader plan to pivot Saudi Arabia’s economy away from its reliance on oil, as falling energy prices open a growing budget deficit.
Although oil prices have recovered from the decade-low of less than $30 a barrel in January, to $52 a barrel, they remain half the level of two years ago.
The country’s economy is forecast to slow this year as prices for oil remain low, with the International Monetary Fund cutting expectations for gross domestic product growth to 1.2 per cent, from 3.5 per cent in 2015.
Copyright The Financial Times Limited 2016. All rights reser
It’s Goodbye QWERTY, Hello Emojis as Apple Redesigns the Keyboard
Tech giant is working on a laptop that will be able to carry any alphabet, special commands and symbols
BEIJING— Apple Inc. has teamed up with an Australian startup to turn the standard QWERTY keyboard into a blank slate.
The new keyboards will be a standard feature on MacBook laptops, and will be able to display any alphabet, along with an unlimited number of special commands and emojis, people familiar with the plans said.
Apple is aiming for a 2018 launch, these people said.
The keyboard technology has been developed by Sonder Design Pty Ltd., an Australian startup backed by Foxconn Technology Group. The keyboards will use so-called E Ink displays much like those seen on Amazon Inc.’s Kindle devices.
Tim Cook, Apple’s chief executive, discussed the MacBook plans with the heads of Foxconn and Sonder on Oct. 11 in China, the people said.
The Guardian and a Reddit user reported last week that Apple was in talks to acquire Sonder.
Foxconn and Sonder said they do not comment on potential customers or dealings with other companies. Apple declined to comment.
A few customizable keyboards have reached the market over the years, including the “Optimus Popularis” keyboard by Art. Lebedev Studio, a Russian design firm. But that unit sold for more than $1,000, limiting its mass-market appeal.
Although the Apple keyboard would be a standard feature, it is likely to hold added appeal to those who frequently type in more than one language, including people in international business and students. People who use software with specialized commands, such as graphic designers and gamers, are also expected to welcome the versatility of the device.
For everyday users, the new keyboard would also make it easy for people to spice up their communications with emojis and other symbolic substitutes for words, which have gained widespread popularity through the spread of smartphones and social networking apps.
For Cupertino, Calif.-based Apple, an eye-catching feature such as a customizable keyboard could help retain interest in a maturing product line.
Apple’s main manufacturing partner, Foxconn, also hopes the project can help it move up the value chain, supplying more key components in addition to assembling devices. Sonder is part of Foxconn’s incubator program and the Taiwanese manufacturer plans to invest in Sonder later this year, the people said.
Production of advanced components nets higher margins than device assembly. Foxconn has made other efforts to shift its business mix toward components, including its recent acquisition of Japan’s Sharp Corp.
Sonder’s stand-alone smart keyboards will be launched later this year. The preorder price is $199.