>>> Street Pre-Market Indications

ML
DEBENHAMS - Q1 LFL sales +1.9% v -0.1% est, 1-2% cons u/gs, stock on 8x..+10%
UK MAIL - Solid performance in peak Xmas period, enough given weakness....+4%
MORRISONS - 9wk LFL ex-fuel +0.2% v -2% est, +ve comments on net debt...+3-4%
SIKA - Sales in line, increases longer term targets, all solid............+2%
BRUNELLO - Solid, revs a 2% beat, guides to DD growth in 2016 v 10.5% MLe.+2%
BIG YELLOW - good progress on occupancy and rent psf YoY................+1-2%
EDENRED - To form venture w/ Embratec in expense mgmt, 2% accretive in 16.+1%
AO WORLD - Trading in line with prior views, should see relief............+1%
SAP - Stronger revs in Q4 (5.6% beat) & guidance but margins light........+1%
GPOR - Strong lettings in 9 months YTD, and interest continues to build...+1%
GREGGS - Total sales +5.2%, FY expected to be in line w prev expectations.+1%
DIRECT LINE - Numbers re impact from strike in line, should see relief....+1%
RENTOKIL - Q4 in line with expectations, reassurance strategy on track....u/c
METRO - Q1 org topline +0.1% v +0.8% est,reits FY tgts but Q1 = 60% of FY.u/c
JUST EAT - Short order update, LFL 46% which is -1% on the quarter........u/c
CAP GEMINI - To record one off non-cash profit of EUR 520m in 2015........u/c
SCHAEFFLER - Press spec owners open to additional stock sales.............u/c
ASML - We roll over onto Europe 1, extending term by another 12m..........u/c
SAGA - Supportive IMS, tax gain and possible release of capital...........u/c
FERROVIAL - Wins EUR 324m high speed railway contract in California.......u/c
SHIRE - Weakness persisted slightly post US close, parity 3877p vs 3925p-0.5%
AIRBUS - Press says to deliver 45 A350s in 2016, may disappoint...........-1%
PETROFAC - news from Ithaca points to 6-12 wk delays at Greater Stella....-1%
HAYS - -ve read from very weak MPI LN Q4, HAS report tomorrow...........-1-2%
M. PAGE - Org growth 5.3% v 10.2% exp, extrapolate 16 implies 5-10% d/gs..-4%

CS
Airbus +1% Delivered 14 A350s in 2015 Vs Target 15, La Tribune
AO World +2% UK business continued to grow, strong Black Friday
Autos -1% China Auto Sales 18% yoy for Dec, CS was on 20-21%
Cap Gem +1% Amendment to accounting
Cineworld +1% Anticipates 2015 profitability inline
Big Yellow +1-2% LFL revenue growth of 10%, earnings guidance inline
BMW -1-2% Biggest exposed to China, negative China autos sales
Brunello +1-2% Released last night, positive outlook for 2016
Bureau Ver +1% CS upgrade to OUTPERFORM (Trading at 13% discount)
Debenhams +5-10% 19-week LFL sales +1.9% vs est -0.1%
Direct Line +1-2% Update on 15 weather events, losses slightly less
Edenred +1% Combine their Expense Management assets in a joint-venture
Grafton UNCH Conditions were broadly positive, maintains guidance
Greggs M/P FY results inline with market expectations
Just Eat +1-2% FY total orders +57% and 46% on LFL basis
Ladbrokes +1% CS upgrade to NEUTRAL (Cost synergies)
Mcbride +2-3% Reads well, H1 trading will show further progress
Metro +1% Q1 sales EU 17.1b est EU 17.1b, confirms forecasts
Michael Page -5% Q4 135.6m cons 142m, growth 5.3% v cons 10%
Miners -1% Copper -0.35%, Brent -3.85%, Iron Ore -1.80%, China +1.02%
Morrison +5-7% LFL sales better, net debt guidance raised
Oils -1-2% Oil hit hard overnight, -3.85%, heading towards $30/barrel
Peugeot UNCH FY Global sales 2.973m vs CSe 2.921m
Rentokil M/P Announced a series of acquisitions
Rockwool +2-3% Sees upward adjustment of 2015 EBIT
SAP +1-2% Preannounced Q4, software rev's better E5.38b; est. E5.13b
SGS +1% CS upgrade to OUTPERFORM (Margin Opportunity)
Sika +1% Q4 earnings inline, expects EBIT margin of 12-14%, was >10%
Shire -1% ADR 1% weaker overnight, expect to see that in Europe
Will Hill +1% CS upgrade to OUTPERFORM (Balance sheet + cash return)

MF
*AIRBUS-Delivered 14 A350's tgt 15,Zodiac supply issues.Press......-0.5%
*SAP-Rev 6.35b(6.04),OP 2.28b(2.26),Cloud Rev 5.38b(5.13)..........+1%
*PORSCHE-Predicts slower 2016 sales growth after Macan boost.......U/C
*VW-CEO says €6.7b provs for recalls will cover all costs..........+0.5%
*CBK-To shrink Financial Institutions Unit: Handelsblatt...........-0.5%
*SIKA-FY Sales grth CHF5.49B(5.47),co lifts 2018 targets...........+1.8%
*EDENRED-Accelerates development in exp mgmt,jv with Embratec......+0.5%
*METRO-Sales 17.1b(17.1),confirms 2015/16 f/casts,Christmas good...+1%
*TECHNIP-Agrees to buy minority stake in Vallourec's Serimax.......U/C
*CAPGEM-To record estimated €520m Non-Cash income in 2015..........+1%
*CROPENERGIES-Sales 558m,OP 63m,FY o/l +ve at Ebitda & OP level....+1%
*CONTI-no plans for major acq'S in '16,no hope for Brazil rebound..-0.75%
*CUCINELLI-2015 Rev €414m,spring/summer collection +ve,si 17%......+2%
*BOSSARD-FY Sales 656.3(648),Asia bizz looks good,China flat.......U/C
*SUEDZUCKER-Read across from Cropenergies owns 68.7%...............+0.5%

FT : BT will consider joint ventures with Deutsche Telekom

BT will consider joint ventures with Deutsche Telekom

BT will consider joint ventures with Deutsche Telekom after the group becomes the UK company’s largest shareholder, according to the company’s chairman.
Strategic partnerships and more media deals to bolster the television channels that are shown over BT’s broadband network could be considered in future, according to Sir Mike Rake.

He also refused to rule out a bid for Channel 4, the publicly owned UK broadcaster, if it were privatised next year. People close to BT have told the Financial Times that the group has spoken about the broadcaster with shareholders at investor conferences.
“We continue to look [at] what is out there,” says Sir Mike. “The company’s covenant is much stronger than it was, our pension deficit is manageable, and we will be in a strong position to continue to look at the opportunities carefully.”
BT will complete its £12.5bn acquisition of EE next month. As part of the deal, Deutsche Telekom, which co-owns the mobile operator, will have a 12 per cent stake in the UK telecoms group.
BT will come close to completing its plans to extend its fibre network to meet government targets to cover 95 per cent of the UK with superfast broadband in the next two years.
However, there are challenges looming, in particular the prospect of regulatory restraints being placed on the business. Ofcom is conducting a once-in-a-decade review of the UK telecoms market that could result in the formal split of BT Openreach, the division that owns and operates the national fixed-line and broadband network.
Sir Mike warns that such a decision would lead to “huge practical issues” that would delay the rollout of superfast broadband for several years at a time when the government has promised to finish covering the rest of the UK with such services.
“Functional separation has been hugely successful. Why would you stop something that is successful?” he says. “And in practice, who is going to buy it? How long would it take? With that level of uncertainty we have a fiduciary duty over the level of investment we can make in that period.”

He describes BT’s fibre rollout as the most important decision taken in the last 10 years, adding that it has been critical “for the country and its competitiveness”.
The company needs to improve its customer service, however, with Sir Mike describing it as the company’s “Achilles heel”. He blamed the decision to offshore such functions, and says this is being corrected by bringing call centres back to the UK.
BT will also need to integrate EE, Sir Mike says, hoping that BT will “keep as much top level management as we can”.
As part of the deal, Deutsche Telekom, which co-owns EE with Orange of France, will get a 12 per cent stake in BT.
Sir Mike shrugs at suggestions that the German group could mount a takeover of its UK partner, despite analysts and investors in both groups widely discussing the issue.

“We live in a global world and the UK is one of the most open economies in the world. But who knows?,” he says. “There is no golden share and we will do the right thing by our shareholders. There is a three-year standstill. We will get on with integrating EE.”
Sir Mike is one of the best connected power brokers in the City, swinging between board positions at FTSE 100 companies and business and government advisory roles. The deputy chairman of Barclays is a former international chairman of KPMG, the professional services group, and previously led the CBI, the UK employers’ organisation.
So it is little surprise that the conversation alights on two key themes close to his heart: UK competitiveness, and specifically the City of London; and how important it is for Britain to remain in the EU in this context.

Sir Mike is a prominent Europhile and insists that the majority of businesses in the UK do not want Brexit.
“On the economic side it owns every argument,” he says. “About two-thirds of CBI members think we need to stay in, constructively engage and get it right. What we can’t do is keep quiet on that issue.”
At 67, Sir Mike acknowledged that he has only a few more years juggling his wide range of non-executive positions. A skiing accident ended his participation in polo, and he no longer breeds ponies for the sport in the UK.
But BT, he says, will keep him busy for some time to come.

FT : Brussels summons European telcos to 5G meeting


Chief executives from Europe’s 10 largest telecoms groups have been summoned to a meeting by Brussels’ digital commissioner to speed up and implement a strategy to deploy next generation 5G mobile services. ‎
Regulators are worried that Asian countries such as China, Japan and South Korea will lead the development of a technology that will become essential to digital services, according to people familiar with the thinking of the commission.

In a letter to telecoms bosses seen by the Financial Times, Günther Oettinger, European commissioner for digital economy, wrote that “Europe must be a leader in this area”.
The letter says Mr Oettinger wants to create “closer EU co-ordination to achieve a timely deployment of 5G” and to create a “home market” in Europe for 5G products and services.
The meeting will discuss how to encourage “strategic investments infrastructure” and create an “action plan” to take 5G deployment beyond simply research.
The letter has been sent to the chief executives of BT, Deutsche Telekom, Telecom Italia, Orange, Vodafone, Nokia and Ericsson to arrange a meeting on Tuesday.
5G technology is being developed in research labs around the world but the term has already come to mean the creation of an almost instant mobile internet that will underpin services that require constant data links such as connected cars and homes.
Telecoms companies are in a global race to establish the standards that will enable 5G-based equipment, even if many countries are only just adapting to 4G systems that already allow fast internet connections over mobile devices.
Countries such as China and South Korea are investing heavily in 5G development work, with the latter expecting to have a service ready for the 2018 Winter Olympic Games. Most telecoms companies do not expect to have a commercial form of 5G available until after 2020.
Creating and owning the patents to a new global technology could be lucrative to regional telecoms groups, which could also generate sales of 5G-related devices and infrastructure equipment.
The commission confirmed that the meeting would not touch on its plans to liberalise the EU’s rules on spectrum, which are expected in February.

Brussels has made reform of telecoms rules one of its main aims for 2016, with a new package due by the end of the summer according to Mr Oettinger.
He believes the legal framework of the telecoms industry is more than a decade old, leaving it looking outdated.
“Back then we talked only of fixed and mobile telephony,” Mr Oettinger said.
“Now the telecoms sector has spread into other fields, data services and digital services. Modernisation of the telecom framework is something that is on the cards this year.”
During a press conference on Monday, Mr Oettinger hinted that regulation should be used to increase “fair competition” in both the broadcasting and telecoms sectors.
The commissioner has been critical of companies such as Google that have blurred the lines between internet, broadcasting and telecoms sectors, arguing that they benefit from lighter regulation than their traditional peers.

>>> CGG shareholders approve EUR 350m capital increase project

CGG shareholders approve EUR 350m capital increase project
Story
CGG shareholders in their recent meeting have approved an EUR 350m capital increase project.

The shareholders’ meeting of CGG was held under the chairmanship of Mr. Remi Dorval, Chairman of the Board of directors.

Shareholders adopted all of the resolutions supported by the Board of directors, in particular the third resolution which, in accordance with the announcements made by CGG on 7 December 2015, delegated to the Board of directors the authority to decide to carry out a capital increase with preferential subscription rights in favour of holders of existing shares up to a maximum nominal amount of EUR 350m, as part of the implementation of the Transformation Plan (The third resolution was adopted by a majority of 99.60% of shareholders present or represented).

CGG intends to launch this capital increase as soon as possible, subject to market conditions and to granting of a visa by the Autorite des marches financiers on the corresponding prospectus.

(HSBC) Orange Buy: 2016 – CEO confident of business trends

Orange

Buy: 2016 – CEO confident of business trends

* CEO confirms that Orange is on track to keep delivering strong commercial and financial KPIs;
* Talks are progressing with other players to prepare for the consolidation in the French telecom market
* We think both points could help the re-rating of Orange vs European peers; retain Buy rating, TP EUR18 unchanged

French consolidation can only happen if Orange benefits
Both Orange and Bouygues have announced (companies’ press releases, 5 January 2015) that they are discussing consolidation of the French telecom market from 4 to 3 integrated players. The CEO describes the operation as complex from a regulatory point of view but that the French competition authority might be in charge if an agreement is eventually reached with Bouygues. This would also require Iliad (ILD FP, Buy, CMP EUR224.50) and Numericable-SFR (NUM FP, Buy, CMP EUR36.85) to participate in the Bouygues Telecom assets’ carve-out. Key to shareholders, Orange’s CEO continuously repeated yesterday that the only way to reach an agreement is for it to create value to Orange shareholders. He insisted on the fact that a deal could only be structured in a way that benefits Orange, a condition he set very clearly. We deduct from the CEO comments that the initial share dilution (Orange could pay some of Bouygues telecom assets in shares and cash) would be very limited before synergies, well below the 15% Bouygues stake in Orange that was suggested in the press (JDD, 3 January 2016).

>>> What to look at today - 12th of January 2016

Dow+0.32% S&P+0.09% Nasdaq-0.12% Russell-0.41% VIX 24.30 (-10.03%)
US Market closed near flat line. Falling oil prices in the face of global growth concerns continued to weigh on the overall sentiment, short-circuiting a rebound attempt. Looking overseas, China's Shanghai Composite surrendered 5.3% despite reporting economic data that was largely in-line with analyst expectations. WTI crude had slipped 5.3% to end at $31.41/bbl. commodity-sensitive energy (-2.1%) and materials (-1.6%) claimed the bottom two rungs followed by health care (-1.2%), industrials (+0.1%) and financials (+0.4%). Looking at the flipside, consumer staples (+1.0%), consumer discretionary (+0.9%), telecom services (+0.8%), and technology (+0.6%) lead the pack. MCK fell 10.3% after the company narrowed its guidance for FY 2016, citing weaker pricing on generics in the second half of the fiscal year. Fellow drug wholesalers ABC and CAH also declined, falling 4.0% and 5.5%, respectively...IBB-3.5%...Volume were still High with more than 1bil shares. US After Hours : ELOS +9.7%, BURL +8.2%, LULU +8.0%, UCTT +6.3%, TACO +3.7%, SKUL -20.9% following earnings/guidance, APOL +19.3% (following report that Apollo Global Management (APO) nearing deal to buy Apollo Education). Asian equity markets are trading mixed amid continued volatility across asset classes. Nikkei225 is the underperformer with catchup selling after Monday holiday, while Shanghai is marginally higher after yesterday's steep decline. PBoC has set Yuan little changed again, strengthening the fix relative to the close for the 3rd straight session, but the impact of that move is now more muted. Instead, fixed income traders are increasingly focused on the Hibor rate set at a new record high yet again. Analysts contend that the PBoC is trying to disarm Yuan sellers by boosting the cost of borrowing to short the currency prohibitively expensive. The spread between onshore and offshore Yuan has since moved to flat, the narrowest since October. NDRC's Li Pumin remarked that China economy has tracked to meet 2015 GDP target of 7% and added about 13M new jobs. Alcoa kicked off the unofficial start of the US earnings season with Q4 results largely in line with expectations. For 2016 AA's initial forecast of aluminum demand growth was set at 6%, which was below the 6.5% target for 2015 affirmed in last quarter's earnings. Shares fell slightly in the extended session.

Nikkei -2.71% ( was closed yest) Hang Seng -0.82% Shanghai +0.23%

Eur$ 1.0882 CNY 6.5756 CNH 6.5851 JPY 117.37 GBP 1.4527 RUB$ 76.9260 WTI $30.57 (-2.64%)

S&P -0.35% EuroStoxx -0.26% Dax -0.18% SMI -0.09%

Macro :
- Third Avenue Sees Assets Fall 21% in Quarter as Investors Flee
- China Steps Up Yuan Defense as Soaring Offshore Rates Slam Bears
- China Forecasts Vehicle Sales to Accelerate After Tax Cut
- Alcoa’s Jekyll and Hyde Results Underscore Coming Aluminum Split
- Goldman Sachs Sees $64 Billion in Buybacks Rescuing Japan Stocks

Keep an eye on :
- ABI BB : Asahi Says It’s Considering Tie-Ups After Peroni, Grolsch Report
- AF FP : KLM, Etihad Benefit From Cooperation, KLM CEO Tells Telegraaf
- BAS GY : BASF Must Repay Belgium About EU200m in EU Tax Decision: Tijd
- BC IM : Cucinelli 2015 Net Rev. Rises 16%, Sees Double-Digit 2016 Growth
- BMPS IM : Monte Paschi Short Selling Banned Tuesday By Italy Mkt Regulator
- CAP FP : Cap Gemini to Record Estimated EU520M Non-Cash Income in 2015
- ALCLS FP : +6% in after hours in US, announced the publication of a study describing the design and development of a new CAR architecture with an integrated switch-on system that permits control over CAR T-cell functions
- CBK GY : Commerzbank to Shrink Financial Institutions Unit: Handelsblatt
- CON GY : Continental AG Says No Plan for Major Acquisition in 2016
- CNHI IM : Deere, CNH Lease Risk Seen ’Ever-Rising’: Barclays
- CSGN VX : Credit Suisse Downgraded by Moody’s, Outlook Is Stable
- DTE GY : German Telco Companies Pledge EU8b in 2016 Broadband Investments
- FAGR BB : Worldquant Expands Fagron Short Position to 1.71%
- MEO GY : Metro 1Q Sales In Line With Ests., Confirms FY Outlook
- NOVN VX : Novartis Could Spend Up to $5b on M&A, Sees Alcon Plan Jan. 27
- PAH3 GY : Porsche Expects Sales Growth to Slow After Macan Rollout
- SIKA VX : Sika Reports Accelerated 4Q Sales Growth of 8.3%
- UG FP : Peugeot Citroen 2015 Sales Rose 1.2% to 2.97 Mln Vehicles
- PFE US : Pfizer CEO Thinks Drug Pricing Is a ’Political Issue’
- RIO LN : Rio May Miss 2015 Shipping Target as BHP on Track for FY16: UBS
- SAP GY : SAP 4Q Non-IFRS Oper Profit EU2.28b, Est. EU2.26b
- SHA GY : Schaeffler Owner Says He’s Open to Additional Stock Sales
- SHP LN : Shire, Baxalta Merger Pact Has Termination Fee Up to $369.0m
- TEC FP : Technip Agrees to Buy Minority Stake in Vallourec’s Serimax
- TWX US : Icahn Says He Doesn’t Own Any Shares in Time Warner: CNBC
- VIV FP : Universal Said to Near Licensing Deal With SoundCloud: NYP
- VOW3 GY : Volkswagen’s Mueller Doesn’t See Selling Off Any Brands

>>> Europe : Brokers Upgrades & Downgrades - 12th of January 2016

>>> Up
*AAREAL BANK RAISED TO HOLD VS SELL AT BERENBERG
*AIR FRANCE-KLM RAISED TO EQUALWEIGHT VS UNDERWEIGHT AT BARCLAYS (Note attached)
*BANKIA RAISED FROM EQUALWEIGHT AT BARCLAYS
*BANCO POPOLARE RAISED TO BUY AT HSBC
*BARRATT RAISED TO BUY AT JEFFERIES
*BERKELEY RAISED TO BUY AT JEFFERIES
*BNP PARIBAS RAISED TO BUY VS HOLD AT SOCGEN
*BUREAU VERITAS RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*CAIRN ENERGY RAISED TO EQUALWEIGHT VS UNDERWEIGHT AT BARCLAYS
*CUCINELLI RAISED TO BUY VS HOLD AT KEPLER CHEUVREUX
*CENTRICA RAISED TO OUTPERFORM VS NEUTRAL AT EXANE
*DANONE RAISED TO BUY VS NEUTRAL AT NOMURA
*DRAX RAISED TO HOLD VS SELL AT DEUTSCHE BANK
*EDPR RAISED TO BUY VS HOLD AT DEUTSCHE BANK
*E.ON RAISED TO BUY VS HOLD AT DEUTSCHE BANK
*FORTUM RAISED TO HOLD VS SELL AT DEUTSCHE BANK
*GALLIFORD TRY RAISED TO BUY AT JEFFERIES
*GAZPROM NEFT RAISED TO NEUTRAL VS UNDERWEIGHT AT JPMORGAN
*GEBERIT RAISED TO BUY VS HOLD AT KEPLER CHEUVREUX
*GENEL RAISED TO OVERWEIGHT VS EQUALWEIGHT AT BARCLAYS
*JUPITER RAISED TO OUTPERFORM VS NEUTRAL AT EXANE
*LADBROKES RAISED TO NEUTRAL VS UNDERPERFORM AT CREDIT SUISSE
*LEGRAND RAISED TO BUY VS HOLD AT KEPLER CHEUVREUX
*OSRAM LICHT RAISED TO BUY VS HOLD AT HSBC
*RWE RAISED TO OVERWEIGHT VS NEUTRAL AT JPMORGAN
*SABADELL RAISED FROM EQUALWEIGHT AT BARCLAYS
*SGS RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*STANDARD LIFE RAISED TO BUY VS HOLD AT DEUTSCHE BANK
*ST JAMES’S PLACE CUT TO HOLD VS BUY AT DEUTSCHE BANK
*SWEDBANK RAISED TO BUY VS HOLD AT DNB
*TERNA RAISED TO BUY VS HOLD AT DEUTSCHE BANK
*WHITBREAD RAISED TO BUY VS NEUTRAL AT CITI
*WILLIAM HILL RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE

>>> Down
*ACCIONA CUT TO HOLD VS BUY AT DEUTSCHE BANK
*BHP BILLITON CUT TO UNDERWEIGHT VS EQUALWEIGHT AT BARCLAYS
*BHP BILLITON CUT TO REDUCE VS HOLD AT HSBC
*BOOKER CUT TO NEUTRAL VS BUY AT CITI
*CHARIOT OIL CUT TO HOLD VS BUY AT JEFFERIES
*EASYJET CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*ENDESA CUT TO NEUTRAL VS OUTPERFORM AT EXANE
*INTERCONT HOTELS CUT TO NEUTRAL VS BUY AT CITI
*L’OREAL CUT TO UNDERPERFORM VS SECTORPERFORM AT RBC, PT EU145
*MEAD JOHNSON NUTRITION CUT TO NEUTRAL VS BUY AT NOMURA
*NORILSK NICKEL CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*POPULAR CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*PREMIER OIL CUT TO HOLD VS BUY AT JEFFERIES
*PROXIMUS CUT TO NEUTRAL VS OVERWEIGHT AT JPMORGAN
*PRUDENTIAL CUT TO HOLD VS BUY AT DEUTSCHE BANK
*TALKTALK CUT TO NEUTRAL VS OVERWEIGHT AT JPMORGAN
*TELE2 CUT TO NEUTRAL VS OVERWEIGHT AT JPMORGAN
*TELENOR CUT TO UNDERWEIGHT VS OVERWEIGHT AT JPMORGAN
*VERBUND CUT TO NEUTRAL VS OUTPERFORM AT EXANE
*ZURICH INSURANCE CUT TO UNDERWEIGHT VS NEUTRAL AT JPMORGAN

>>> PT Change


>>> Initiation
*FERRAGAMO RATED NEW BUY AT CITI; PT EU27
*LUXOTTICA RATED NEW BUY AT SOCIETE GENERALE
*SCANDIC HOTELS RATED NEW EQUAL WEIGHT AT MORGAN STANLEY
*URALKALI RATED NEW EQUALWEIGHT AT BARCLAYS, PT 160 RUBLES

>>> Call
>> Stock
*DEUTSCHE TELEKOM EXITS HSBC EUROPE SUPER 10 PORTFOLIO
*ORANGE ADDED TO HSBC EUROPE SUPER 10 PORTFOLIO
*SEADRILL EXITS CONVICTION SELL LIST AT GOLDMAN; STILL SELL
>> Sector
*EUROPE OIL & GAS SECTOR CUT TO NEUTRAL VS POSITIVE AT BARCLAYS

>>> After Hours Summary: ELOS +9.7%, BURL +8.2%, LULU +8.0%,


After Hours Summary: ELOS +9.7%, BURL +8.2%, LULU +8.0%, UCTT +6.3%, TACO +3.7%, SKUL -20.9% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings:  ELOS +9.7%, BURL +8.2%, LULU +8.0%, UCTT +6.3%, TACO +3.7%

Companies trading higher in after hours in reaction to news:  APOL +19.3% (following report that Apollo Global Management (APO) nearing deal to buy Apollo Education), CLLS +6.0% (announced the publication of a study describing the design and development of a new CAR architecture with an integrated switch-on system that permits control over CAR T-cell functions), XONE +4.6% (to raise ~$13 mln in gross proceeds in a registered direct offering of common shares from its Chairman and CEO), PODD +2.3% (entered into development agreement with Eli Lilly (LLY) for OmniPod delivery of U200 concentrated insulin).

After Hours Losers:

Companies trading lower in after hours in reaction to earnings:  SKUL -20.9%, HTWR -1.4%

Companies trading lower in after hours in reaction to news:  EGO -3.9% (amended investment plans in Greece), EDR -2.4% (announced 5.5 mln common stock offering), GOOD -1.3% (filed $500 mln mixed securities shelf offering

>>> Asian Update

Asian Market Update: Hibor spikes again; Oil selloff gushing to new lows; Alcoa outlook tepid in earnings season debut


***Economic Data***
- (JP) JAPAN NOV CURRENT ACCOUNT BALANCE: ¥1.1T (17th straight surplus) V ¥0.9TE; ADJUSTED CURRENT ACCOUNT: ¥1.42T V ¥1.51TE; TRADE BALANCE: -¥272B V -¥159BE
- (JP) JAPAN DEC BANK LENDING (INCL TRUSTS) Y/Y: 2.2% V 2.3% PRIOR; BANK LENDING (EX- TRUSTS) Y/Y: 2.2% V 2.3%E; 20-month low
- (JP) JAPAN DEC CONSUMER CONFIDENCE: 42.7 V 42.5E
- (NZ) NEW ZEALAND DEC ANZ COMMODITY PRICE M/M: -1.8% V -5.6% PRIOR (2nd consecutive decline)
- (AU) AUSTRALIA NOV CREDIT CARD BALANCES: A$51.3B V A$50.6B PRIOR; CREDIT CARD PURCHASES: A$25.6B V A$24.8B PRIOR
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 114.1 v 116.3 prior
- (UK) DEC BRC LFL SALES Y/Y: 0.1% V 0.5%E

***Index Snapshot (as of 04:30 GMT)***
- Nikkei225 -2.3%, S&P/ASX -0.4%, Kospi +0.3%, Shanghai Composite +0.4%, Hang Seng +0.3%, Mar S&P500 -0.2% at 1,910

***Commodities/Fixed Income***
- Feb gold +0.1% at $1,097/oz, Feb crude oil -1.5% at $30.95/brl, Mar copper +0.1% at $1.98/lb
- GLD: SPDR Gold Trust ETF daily holdings rise 2.1 tonnes to 651.7 tonnes; 3rd straigh increase, highest since Dec 1st
- USD/CNY: *(CN) PBOC SETS YUAN MID POINT AT 6.5628 V 6.5626 PRIOR
- (CN) PBoC to inject CNY80B in 7-day reverse repos
- (HK) Offshore overnight yuan HIBOR 66.82% (fresh record high) v 13.4% yesterday

***Market Focal Points/FX***
- Asian equity markets are trading mixed amid continued volatility across asset classes. Nikkei225 is the underperformer with catchup selling after Monday holiday, while Shanghai is marginally higher after yesterday's steep decline. PBoC has set Yuan little changed again, strengthening the fix relative to the close for the 3rd straight session, but the impact of that move is now more muted. Instead, fixed income traders are increasingly focused on the Hibor rate set at a new record high yet again. Analysts contend that the PBoC is trying to disarm Yuan sellers by boosting the cost of borrowing to short the currency prohibitively expensive. The spread between onshore and offshore Yuan has since moved to flat, the narrowest since October. In USD majors, USD/JPY is down about 60pips from the highs below 117.50, AUD/USD down about 30pips from the highs near 0.6970, and EUR/USD is in a 40pip range above 1.0840. EM commodity currencies were pressured lower again - USD/MXN rose to 17.94 and USD/ZAR up about 0.5% at 16.85. Electronic trade in commodities also continues to punish oil, with Feb WTI sliding over 2% from the highs to $30.60.

- Among notable speakers, NDRC's Li Pumin remarked that China economy has tracked to meet 2015 GDP target of 7% and added about 13M new jobs. China's financial sector saw more strain however, with reports of 2015 non-performing loans (NPLs) having doubled in 2015 vs 2014. China auto sector did get some welcome news however, with PCA reporting Dec sales rising 17% and 2015 sales up 8.5%.

- In Japan, Nikkei reported PM Abe anticipates FY16/17 tax revenue to be ¥21T higher than in FY11/12, targeting more spending to deal with population decline and bolstering govt finances while also offering some tax breaks. Fin Min Aso again indicated that Japan corporate fundamentals are not bad, but external risks need monitoring. Going into the spring negotiations period, Nikkei reported that Toyota Motor's labor union is set to request ¥3K rise in monthly base wages, which is only about half requested last year.

- Alcoa kicked off the unofficial start of the US earnings season with Q4 results largely in line with expectations. For 2016 AA's initial forecast of aluminum demand growth was set at 6%, which was below the 6.5% target for 2015 affirmed in last quarter's earnings. Shares fell slightly in the extended session.

***Equities***
US equities / ADRs:
- APOL: Reportedly Apollo Global in talks to buy Apollo Education Group in deal valued at around $1B - press; +22.3% afterhours
- ELOS: Guides Q4 R$78-79M v $74.7Me; +9.7% afterhours
- LULU: Guides Q4 higher $0.78-0.80 v $0.79e, R$690-695M v $680Me ($0.75-0.78, R$670-685M prior guidance); cites successful holiday season; +8.5% afterhours
- BURL: Narrows Q4 guidance $1.44-1.46 v $1.49e (prior $1.44-1.48), Rev +3.7% (prior 3.7-4.7%) SSS to be approximately flat (prior flat to +1%); +8.3% afterhours
- TWX: Investor Icahn reportedly building a stake; May result in a "shake-up" of company - financial press; +4.2% afterhours
- MSCC: To be added to S&P400 index, replacing ATW which moves down to the S&P600 index; +1.8% afterhours
- SAP.DE: Reports prelim Q4 non-IFRS Op profit €2.28B v €2.26Be; non-IFRS Total Rev €6.35B v €6.04Be; prelim FY15 non-IFRS op profit €6.35B; +0.7% afterhours
- AA: Reports Q4 $0.04 v $0.03e, R$5.25B v $5.22Be; -0.8% afterhours
- HAIN: Guides Q2 $0.53-0.56 v $0.57e, R$740-760M v $771Me; Lowers FY16 to $1.95-2.10 v $2.12e, R$2.90-3.04B v $2.97Be; -1.1% afterhours
- SKUL: Lowers Q4 to $0.25-0.27 v $0.37e, Rev to flat y/y (prior $0.38-0.40, Rev +5-7%); Guides FY16 Rev mid-high single digit growth; -22.9% afterhours

Key movers in Asia
- WHC.AU: Reports H1 ROM coal production 9.3M tonnes, +63% y/y; Coal sales 4.9M tonnes, +67% y/y; -5.3%
- WPL.AU -2.2%, STO.AU -3.7%, QAN +2.0% on lower oil prices; BPT.AU biggest decliner in Australia energy, down 11% after CEO change
- Aeon 8267.JP -9.4% (9-month results)
- Galaxy Entertainment 27.hk +2.1%, Sands China +1.4%; positive sectors comments from Morgan Stanley