>>> What to look at today - 18th of May 2016

Dow-1.02% S&P-0.94% Nasdaq-1.25% Russell-1.66% VIX 15.57 +6.06%
US Market closed lower, erasing yesterday gains. the market maintained a negative bias after disclosures that George Soros placed bearish bets on the broader market by doubling his put position on the SPY and boosting his holdings in gold. S&P was not able to maintain its 50d MA. Consumer Staple -1.9%, KHC -4.3%, HRL-3.6%, Healthcare -1.1%, ABBV-3.5%, VRX+7.5%. Volume were above recent average with 1.02bil shares. US After Hours ANDE Philip Falcone's HC2 said to have offered a $37/shr cash bid, $1bil valuation, AGIO +3.4% on collaboration with Celgene, PETX+7.9% on FDA aprov., MACK -4.8% on Phase 2. Asia lower tracking US Markets where improved building permits and in-line CPI added to worries the FOMC rate hikes are back on the radar. Remarks from Fed's Kaplan, Lockhart, and Williams in the US session also went on to signal that the upcoming meetings are live for another rate hike. Japan's Q1 preliminary GDP was a positive surprise after last quarter's contraction, helping the economy avoid a technical recession thanks to improved consumption segment.

Nikkei -0.20% Hang Seng -1.47% CSI -0.89% Shanghai -1.33%

Eur$1.1285 CNH 6.5501 CNY 6.5340 JPY 109.23 GBP 1.4437 CHF 0.98312 RUB$ 64.8495 WTI$ 48.53 (+0.46%)

S&P -0.01% EuroStoxx-0.45% Dax -0.45% SMI -0.20%

Macro :
- Portugal May Sell More 10-Year Bonds This Year, Casalinho Says
- Portugal Doesn’t Plan to Accelerate Early IMF Repayments: Felix
- Juncker Supports Delaying Fine for Spain Over Deficit: El Pais

Keep an eye on :
- ADP FP : Groupe ADP Says April Paris Airport Traffic Rose 4.1%
- AV/ LN : Aviva to Invest in Hoberman Incubator Founders Factory: Sky
- BANI BB : Banimmo 1Q Net Rental Inc. EU2m Vs EU2.2m Yr Earlier
- BP/ LN : BP Head of Exploration Richard Herbert to Step Down: Reuters
- CARLB DC : Carlsberg Chairman Says Brewer Will Remain Independent: FT
- DL NA : Delta Lloyd 1Q Solvency 2 Ratio Drops; GI Premiums Written Rise
- DEXB BB : Dexia Posts EU55m Loss; CET1 Ratio Drops to 14.6% on AFS Reserve
- ELI BB : Elia Says Expanded Maintenance in Germany to Impact 2016 Net
- LEY FP : Faiveley Gets Contracts Worth More Than EU60m From Bombardier
- FRA GY : Fraport CEO Schulte Says EasyJet Seeking Slots, BZ Reports
- FRA GY : Ferrovial, Fraport, Vinci Eye Sofia Airport Concession: Capital
- FER SM : Ferrovial, Fraport, Vinci Eye Sofia Airport Concession: Capital
- IAG LN : Qatar Airways Increases Stake in IAG to 15.01% (from 10%)
- INDUC SS : Industrivaerden Prepared to Make New Investments, DI Reports
- INH GY : Indus 1Q Rev. Rises, Optimistic Will Reach Targets
- KU2 GY : Midea Says Kuka Offer Confirms Intention to Boost Stake --> €4.55bil deal {KU2 GY Equity DES <GO>}
- LLOY LN : Lloyds to Cut Hundreds of Jobs, Focus on Corporate Bank: Sky
- MAERSKB DC : Maersk Is Ready to Expand in Areas to Support Core Business: JP
- NOVN VX : Novartis Says David Epstein to Leave; Splits Pharma Unit in Two
- NOVN VX : Novartis Says LEE011 in Breast Cancer Meets Primary Endpoint
- ORI SS : Oriflame 1Q Result Beat Ests.; Positive Sales Momentum Continues
- P US : Citron’s Left Long Pandora; Says FB, GOOG Should Buy: BTV
- RI FP : Pernod Ricard, Irish Distillers Complete Sale of Paddy Whiskey
- PHARMA NA : Pharming 1Q Net Loss Widens to EU3.39m From EU1.33m
- RCS IM : RCS MediaGroup Agreement With Lending Banks Expected by June 7
- SAF FP : Safran Said Accepting Bids for Morpho Unit: Le Figaro
- SOON VX : Sonova FY Ebita Misses Ests., Div. In Line With BDVD Forecast
- SUNE US : More SunEdison Creditors Object to Bankruptcy Loan
- TESB BB : Tessenderlo Chemie CEO Tack Buys Additional EU0.43m of Stock
- TNTE NA : Fedex Declares Offer for TNT Express Unconditional
- UBI IM : UBI Weighing Options for Stake in Veneto Banca: Repubblica
- UCG IM : UniCredit Progress Undervalued, Market Pricing Capital Gap: RBC
- VALE US : Vale Shareholders Not Government Decide on Executives: Minister
- VRX US : Valeant Said to Weigh Sale of Skin, Cancer Drugs to Reduce Debt
- DG FP : Ferrovial, Fraport, Vinci Eye Sofia Airport Concession: Capital
- VOW3 GY : Lowers prices in Japan to help increase vehicle sales - Nikkei
- WPP LN : Sharesoc Advises Investors to Vote Against WPP Remuneration

>>> Europe : Brokers Upgrades & Downgrades - 18th of May 2016

>>> Up
*BOOKER GROUP RAISED TO BUY VS NEUTRAL AT GOLDMAN
*EURONEXT RAISED TO NEUTRAL VS SELL AT UBS
*HERDEZ RAISED TO BUY AT SANTANDER
*JERONIMO MARTINS RAISED TO BUY VS NEUTRAL AT UBS
*KROTON RAISED TO BUY AT PLANNER CORRETORA
*MUNICH RE RAISED TO BUY AT JEFFERIES
*TESLA MOTORS RAISED TO BUY VS NEUTRAL AT GOLDMAN

>>> Down
*ACACIA MINING CUT TO SELL VS NEUTRAL AT CITI
*AEGON CUT TO EQUAL WEIGHT VS OVERWEIGHT AT MORGAN STANLEY
*BANCO POPULAR ESPANOL CUT TO ADD VS BUY AT ALPHAVALUE
*CAIXABANK CUT TO REDUCE VS BUY AT ALPHAVALUE
*DEUTZ CUT TO HOLD AT HSBC
*ELECTROLUX CUT TO ’SELL’ AT DNB MARKETS
*FRAPORT CUT TO HOLD AT SANTANDER
*GBL CUT TO HOLD AT HSBC
*LEONI CUT TO SELL VS HOLD AT BANKHAUS LAMPE
*SCOR CUT TO UNDERPERFORM AT JEFFERIES
*SWISS RE CUT TO HOLD AT JEFFERIES
*TURKISH AIR CUT TO NEUTRAL AT CREDIT SUISSE
*VOLVO B CUT TO NEUTRAL VS BUY AT UBS

>>> PT Change


>>> Initiation
*DASSAULT AVIATION RATED NEW BUY AT BOFAML; PT EU1,225
*JUST EAT RATED NEW BUY AT BERENBERG; PT 530P

>>> Call
>> Stock
*GENEL ENERGY REMOVED FROM EMERGING EMEA 1 LIST AT BOFAML
*NASPERS ROLLED OVER ON EMERGING EMEA 1 LIST AT BOFAML

>>> Asian Update

Asian Market Update: Japan initial Q1 GDP shows improved growth on rising consumption; AUD retreats as wage prices hit 18-month lows

***Economic Data***
- (CN) CHINA APR PROPERTY PRICES M/M: FALL IN 5 OUT OF 70 CITIES VS FALL IN 8 PRIOR; Y/Y: FALL IN 23 OUT OF 70 CITIES V FALL IN 29 PRIOR
- (JP) JAPAN Q1 PRELIMINARY GDP Q/Q: 0.4% V 0.1%E (1-year high); ANNUALIZED GDP: 1.7% V 0.3%E
- (AU) AUSTRALIA Q1 WAGE PRICE INDEX Q/Q: 0.4% (18-year low) V 0.5%E; Y/Y: 2.1% (multi-year low) V 2.2%E
- (AU) AUSTRALIA APR WESTPAC LEADING INDEX M/M: +0.2% V -0.1% PRIOR
- (NZ) NEW ZEALAND Q1 PPI INPUT Q/Q: -1.0% V -1.2% PRIOR (2nd straight decline); PPI OUTPUT Q/Q: -0.2% V -0.8% PRIOR (2nd straight decline)
- (CL) CHILE CENTRAL BANK (BCCH) LEAVES OVERNIGHT RATE TARGET UNCHANGED AT 3.50%; AS EXPECTED

***Index Snapshot (as of 03:30 GMT)***
- Nikkei225 +0.6%, S&P/ASX -0.5%, Kospi -0.6%, Shanghai Composite -1.7%, Hang Seng -1.7%, Jun S&P500 flat at 2,044

***Commodities/Fixed Income***
- June gold -0.1% at $1,276/oz, June crude oil +0.3% at $48.46/brl, Jul copper -0.9% at $2.07/lb
- GLD: SPDR Gold Trust ETF daily holdings rise 4.8 tonnes to 855.9 tonnes; 9th straight increase; highest since Nov 2013
- (US) Weekly API Oil Inventories: Crude: -1.1M v +3.4M prior; first draw in 3 weeks
- (JP) BOJ offers to buy ¥350B in 1-3yr JGBs, ¥440B in 3-5yr JGBs, ¥450B in 5-10yr JGBs
- (CN) PBOC SETS YUAN MID POINT AT 6.5216 V 6.5200 PRIOR
- (CN) PBOC to inject CNY70B in 7-day reverse repos
- (CN) China MoF sells 2-yr bonds at 2.5051%; Sells 7-yr bonds at 2.9741%
- (AU) Australia MoF (AOFM) sells A$900M in 4.75% 20 Bonds; avg yield: 2.3416%; bid-to-cover: 1.94x

***Market Focal Points/FX***
- Asia equities are favoring the downside, tracking larger losses in US markets where improved building permits and in-line CPI added to worries the FOMC rate hikes are back on the radar. Remarks from Fed's Kaplan, Lockhart, and Williams in the US session also went on to signal that the upcoming meetings are live for another rate hike. In Asia, Japan's Q1 preliminary GDP was a positive surprise after last quarter's contraction, helping the economy avoid a technical recession thanks to improved consumption segment. China housing prices maintained their trend of recovery. In FX majors, USD/JPY was volatile around the GDP release, initially falling below 108.80 and then rising above 109.20. AUD/USD was down about 50pips on soft wage inflation, falling to 0.7280. NZD/USD was down about 30pips below $0.6790, with added weakness coming on another decline in Q1 PPI.

- Japan Q1 prelim GDP came in at a 1-year high on sequential basis, with a some telling signs in the components. Exports rose 0.6% after a -0.8% drop in Q4, and consumption was a 3-quarter high of +0.5%, above +0.2%e and up from -0.9% in Q4. On the downside, recovery in CAPEX was notoriously absent, as non-residential investment was -1.4% v -0.8%e - the biggest decline since Q2 2015. Japan Econ Min Ishihara said the economy continues moderate recovery trend with a notable rebound in consumption, though slowing growth in China and emerging market volatility bear close watching. PM Abe's advisor Hamada recommended that the govt holds off on the sales tax hike plans but also warned that an intervention on currency could impact US/Japan ties.

- China April property prices retained their upward trend, as nearly all of top 70 cities saw sequential increase. Overall, m/m prices were up for the 12th straight month and y/y up for 7th straight month at 2.0% and 12.4% respectively. Elsewhere, the NEA saw April power consumption growth slow to 1.9% y/y from 5.6% prior, and a high-profile editorial in Chinese press called for more policy support to stimulate growth in private investment.

***Equities***
US equities / ADRs:
- ANDE: Philip Falcone's HC2 said to have offered a $37/shr cash bid for Andersons, for $1B total valuation - press; +28.1% afterhours
- AGIO: Establishes new collaboration with Celgene in metabolic immuno-oncology and amend certain rights from 2010 agreement; +3.4% afterhours
- VIPS: Reports Q1 $0.16 v $0.16e, R$1.89B v $1.87Be; -11.5% afterhours

Notable movers by sector:
- Consumer discretionary: China Eastern Airlines 670.HK -1.8% (Apr result); Car Inc 699.HK -1.7% (Q1 result); Intime Department Store Group 1833.HK -3.0% (asset-light arrangement)
- Financials: Macau Legend Development 1680.HK -1.0% (Q1 result); IOOF Holdings IFL.AU -5.8% (guidance)
- Industrials: Xinyi Glass Holding Co 868.HK +1.0% (proposes spin-off and separate listing of unit); Hitachi 6501.JP +2.1% (mid-term targets)
- Materials: Galaxy Resources GXY.AU +9.1% (final offtake agreement)

>>> US After Hours Summary: ANDE +26% following acquisition proposal f


After Hours Summary: ANDE +26% following acquisition proposal from HCHC

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: NETE +19.4%, AGIO +2.8%

Companies trading higher in after hours in reaction to news: ANDE +26.3% (HC2 Holdings (HCHC) sends letter to Chairman of ANDE stating desire to acquire Co for $37/share in cash), PETX +7.9% (announces the FDA Center for Veterinary Medicine approved Entyce for appetite stimulation in dogs), CETX +3.6% (files to withdraw form S-3 files with SEC on April 11, 2016), AGIO +2.8% (Co & Celgene (CELG) announce a strategic collaboration focused on metabolic immuno-oncology, Agios to receive an upfront cash payment of $200 mln), AVID+1.5% (CEO disclosed purchase of 100K shares in multiple transactions)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: VIPS -9.9%, ACXM -8.2%

Companies trading lower in after hours in reaction to news: MACK -4.8% (presented expanded analysis of its Phase 2 study of seribantumab in combination with exemestane in HER2-negative, hormone receptor positive metastatic breast cancer)

FT : Uber targeted by Paris over self-employed status of drivers

Uber targeted by Paris over self-employed status of drivers

Uber has found itself the target of further legal challenges in France after the official body that collects social security contributions moved to force the company to reclassify its drivers as employees.
The Urssaf for Paris and surrounding areas has launched two separate challenges to the California-based company, arguing that it has avoided paying millions of euros in employee-related charges because it has not registered its drivers as employees.

Jean-Marie Guerra, director of enforcement at Acoss, part of the country’s social security network, said that Uber owed “several million euros” to the social security system, according to comments to AFP, the news agency.
He added that the Urssaf had taken the case to the country’s social security affairs tribunal to have the company reclassify its drivers as employees — a move that would force Uber to pay millions in employer contributions.
Mr Guerra told the AFP that Urssaf had also begun criminal proceedings with the Paris prosecutor against the company for alleged abuse of status.
On Tuesday, Uber acknowledged the proceedings, which were launched at the end of last year.
Insisting that the overwhelming majority of drivers in France opt to become self-employed “precisely to be able to work independently”, Uber said: “We are therefore strongly challenging the accuracy and validity of these procedures, but we shall leave it up to the courts to decide.”
The company added that a decision against it would have far-reaching consequences for the entire ride-hailing sector given that the majority of taxi drivers are classified as independent.
Uber said that in several recent cases, France’s leading courts of appeal have refused to reclassify independent taxi drivers as employees.
The latest legal challenges, which could take more than five years to work their way through the country’s legal system, add to Uber’s significant problems in France, its biggest market in terms of revenues outside the US.
Thibaud Simphal, who heads Uber’s operations in France, and Pierre-Dimitri Gore-Coty, head of Uber in Western Europe, stood trial in February on charges of “misleading commercial practices” and “complicity in the illegal exercise of the taxi profession”. A verdict is expected on June 9.
In January, the company was ordered to pay €1.2m to the National Union of Taxis for failing to enforce an aspect of a 2014 law governing minicab services.
The payment came after complaints that drivers using the app were not returning to their bases between rides, as required by law. Uber has appealed the fine.
The company has long insisted that its drivers, regardless of jurisdiction, are independent contractors, not employees. But that view has been challenged in court, and Uber recently reached a combined $100m settlement in class-action lawsuits in California and Massachusetts.
The agreement maintained the drivers were independent contractors but gave them the right to organise into associations that will be able to meet with Uber management.
Earlier this month, Uber and the Machinists Union reached an agreement in New York City under which all Uber drivers in the city will be able to join the newly-formed Independent Drivers Guild.
The guild, which is affiliated with the Machinists Union, will provide them with benefits, including regular meetings with management and representation if they are terminated.
However, it stops short of being a full union, and drivers who are members would still be considered independent contractors of Uber, a status that means they are not eligible for collective bargaining rights.