FT : US prepares new Iran sanctions over missile tests


The Obama administration is preparing new sanctions on companies and individuals involved in Iran’s ballistic missile programme just weeks before the nuclear deal with Iran is due to be implemented.
The Treasury department is planning new designations in response to two ballistic missile tests that Iran has conducted since the nuclear agreement was signed in July, a US official said.

If introduced, the sanctions would present a delicate diplomatic test for the nuclear agreement with Iran, which involves substantial reduction in sanctions on Tehran in return for significant restrictions on its nuclear programme. Iran has warned that new US sanctions would be a violation of the nuclear deal.
US officials provided no details on the potential new sanctions. The Wall Street Journal reported on Wednesday that the Treasury department would target around a dozen people and companies in Iran, the United Arab Emirates and Hong Kong that it believes have been involved in Iran’s ballistic missile programme.
The sanctions would freeze any US assets of the individuals and companies, bar Americans from doing business with them and exclude them from the US financial system.
According to US officials, Iran conducted separate missile tests in October and November, while a United Nations panel of experts has already confirmed the October test. Such missile launches are a violation of a UN Security Council resolution which will be withdrawn once the nuclear deal is implemented.
The US Navy also said on Wednesday that Iran had conducted a “highly provocative” rocket test near its warships passing through the Strait of Hormuz.
The administration has come under heavy pressure to take action against Iran over the missile tests from Congress, especially from members who were already highly critical of the nuclear agreement.

“The failure to impose consequences on Iran for its violation sets a dangerous precedent before implementation of the nuclear agreement when sanctions are lifted and the leverage shifts to Iran,” Bob Corker, the Republican chair of the Senate foreign relations committee, said earlier this month. “With inaction over the missile tests….. the nuclear deal is getting off to a terrible start.”
Iranian missile tests are such a sensitive issue in Washington because US officials believe they could be used to carry nuclear warheads.
The sanctions and the Iran missile tests are not the only potential stumbling blocks towards implementing the nuclear agreement.
European officials have privately complained to the Obama administration that proposed legislation to tighten visa rules could violate the nuclear agreement because they would force any European executive who has been to Iran to apply for visa in order to visit the US.

(BofA-ML) Follow the Flow : Flat for the year

No festive cheer for credit flows
- Going into the festive season did not bring any respite for credit outflows. Both
high grade and high yield funds kept on the same trend, as credit outflows continued for
a third week, with an amplitude close to those of the previous weeks.
- High yield had a third successive week of outflows, dragging the year-to-date figure
close to -$3bn. High grade fund flows were also negative over the week, and actually
intensified w-o-w. This was the biggest outflow in 12 weeks. Year-to-date cumulative
flows are now almost down to zero.
- Euro-domiciled government bond funds reacted positively post the Fed hike and
recorded their first positive week in December. Looking at equities, the asset class
managed to maintain an inflow for the 12th week in a row, driving the year-to-date
figure over the $120bn mark.
- EPFR monthly data have been released. For the month of November, yield was in
vogue and both high yield and equities led the flows. High yield saw inflows of more
than +$2.8bn, marking a significant increase compared to October. In equites, monthly
data verify the strength seen in weekly figures (+$8.3bn in November), with an
impressive record of all months in 2015 having had positive inflows.

However, monthly data for investment grade paints a dim picture. November was the sixth
negative month of flows in a row (-$1.9bn). But outflows have declined to the smallest
since the start of the trend in June. The same for government bond funds, as they suffered
significant outflows in November (-$3.7bn) -- the largest since the start of 2H.

All in all, it seems that credit funds have seen improvement trends over the past two
months compared to Q3.

>>> Reckitt Benckiser lining up deals

Reckitt Benckiser lining up deals
Reckitt Benckiser [LON:RB] is working on “interesting” deals, according to a blog posting cited by a market report in The Times. The newspaper did not name the “well-followed” blog, and did not specify the type of deals that the UK-based consumer products company was said to be working on.

Separately, the item noted that Reckitt yesterday, 30 December announced plans for a GBP 800m (EUR 1.08bn) share buy-back.

Reckitt Benckiser’s share price closed 5p up at 6310p in London yesterday, 30 December, valuing the company at GBP 44.67bn.

The Times (London), Blog

>>> Vodafone and Liberty Global gauging investor appetite for ‘friendly’ merger;

Vodafone and Liberty Global gauging investor appetite for ‘friendly’ merger; Liberty could bid for ITV 

Vodafone [LON:VOD] and Liberty Global [NASDAQ:LBTYA] have been sounding out major shareholders regarding the level of support for a potential “friendly” merger, The Daily Mail reported. The newspaper’s market report section cited dealers for speculation that Liberty Global Chairman John Malone has initiated fresh talks about a possible merger between the UK-based cable media group and Vodafone, a UK-based mobile telecoms operator.

The response from major shareholders to the merger overtures from Vodafone and Liberty Global executives was positive, the item said. The report added that the developments have set the stage for Vodafone and Liberty to agree to a deal early in 2016.

As previously reported, Vodafone and Liberty Global discussed possible asset swaps earlier this year. The discussions broke off in September without a deal.

Separately, the article noted that Liberty owns a 9.9% shareholding in ITV [LON:ITV], adding that Liberty might soon decide to launch a takeover bid for the UK-based television broadcaster.

Vodafone’s share price closed 1.25p down at 217.5p in London yesterday, 30 December, giving the company a market capitalisation of GBP 57.75bn (USD 78.30bn). Liberty Global shares closed USD 0.19 up at USD 40.44, valuing the company at USD 33.23bn.

ITV’s share price closed 1.5p down at 276.5p in London yesterday, giving the FTSE-100 broadcaster a market capitalisation of GBP 11.13bn.
Daily Mail

>>> What to look at today - 31st of December 2015

Dow-0.66% S&P-0.72% Nasdaq-0.82% Russell-0.92%
US Market closed lower. S&P Still in positive territory for the year, +0.2%. Equity indices slipped into the open after overnight selling pressure in oil drove the commodity below the $37.00/bbl price level. This price action came after the American Petroleum Institute reported that crude stockpiles rose by 2.9 million barrels versus a decrease of 3.6 million barrels last week. An hour after the open, the Energy Information Administration disclosed a build of 2.629 million barrels on their weekly crude inventory report versus an expected draw of 2.457 million barrels. The commodity fell 2.9% on the day, ending at $36.80/bbl. the commodity-sensitive energy (-1.5%) and materials (-1.0%) sectors posted the largest losses while utilities (-0.2%), consumer staples (-0.4%), healthcare (-0.5%), industrials (-0.8%), technology (-0.8%), consumer discretionary (-0.8%), and financials (-0.8%) outperformed. Volume were light again with less than 600mil shares. VOD +1.3% said to be in new merger talks with Liberty global, CMRX+3.8% on Point72 5.3% passive stake, CHLN+7.4% on 1 for 50,000 reverse stock split. Asia's key equity indices were either closed for extended New Year's holidays or went out after a half day of generally listless action. Australia's ASX was down modestly on the day, closing 2015 off by nearly 2%. Hang Seng is also finished for 2015, rising marginally but falling over 7% for the year - the biggest annual loss since 2011. TOSBF (Toshiba 6502.JP): Japan govt investment fund Innovation Network Corp. of Japan (INCJ) plans to support overhaul of electronics and other business units - Nikkei; +5.6%

Nikkei closed Hange Seng +0.15% Shanghai -0.38%

Eur$ 1.0931 JPY 120.43 CNY 6.4934 GBP 1.4823 CHF 0.9896 RUB$ 74.1591 WTI $36.65(+0.14%)

S&P+0.12% EuroStoxx Closed Dax Closed SMI Closed

Macro :
- Puerto Rico to Default on $37 Million of Payments Due Jan. 1
- Goldman Expects 3% Treasury Yields Next Year, Echoing 2015 Call
- In World With Too Much Crude Oil, 1,100-Foot Steel Monsters Rule
- Rally in Energy Stocks Not Enough to Save Worst Month in 3 Years
- Swift Data for International Transaction : USD (42.7%), EUR (29.5%), GBP (8.9%), and JPY (2.7%), CNY(2.3% from 1.9% YOY)

Keep an eye on :
- ABI BB : Compania Cervecera Canarias put up for sale by AB InBev - El Confidencial
- ABG SM : Abengoa Seeking to Sell Stalled Brazil Projects: Reuters
- ACS SM : ACS to Electrify, Maintain Israel Railways Lines: Expansion
- CCL LN : Carnival to Build 4 Cruise Ships as Part of Pact W/ Fincantieri
- CON GY : Continental May Lose Sales on VW Exhaust Scandal, CEO Tells BZ
- CON GY : Continental to make buys to boost services competencies - BZ
- DAI GY : Daimler’s Uebber Rejects Spinoff, IPO for Commercial Vehicles
- DBK GY : Deutsche Bank Sued by German City of Pforzheim Over Swaps
- FAGR BB : Fagron Gets Waiver From Financiers Through End of March
- GENL LN : *GENEL ENERGY COMMITTED CÔTE D'IVOIRE DRILLING PROGRAM ENDS
- IFX GY : Infineon Balances Sales, Margins in Fragmented Industrial Market
- ITX SM : Inditex Workers in France Reach Sunday Work Accord, AFP Says
- MMB FP : Mondadori May Buy Lagardere’s Tele 7 Jours Magazine: Les Echos
- OCI NA : Nassef Sawiris Buys 29,952 OCI Shares for EU22.66 Apiece: Filing (3rd day in a row...) {OCI NA Equity HDS<Go>}
- SPD LN : Sports Direct Says Workers to Be Paid Above National Min Wage
- STL NO : Statoil Says Output at Troll Unaffected by Storm, Rig Incident
- VOD LN : Vodafone, Liberty Global Said in New Merger Talks: Daily Mail

>>> Brantano receives interest from multiple parties after Macintosh bankruptcy

Brantano receives interest from multiple parties after Macintosh bankruptcy
More than 10 parties are interested in acquiring the Brantano footwear chain, according to its Director Stefaan van Weyenbergh, who was interviewed by De Tijd. Brantano, which operates 129 footwear stores across Belgium, according to the report, is part of the Dutch Macintosh holding company which was declared bankrupt yesterday.

Concrete talks are ongoing, Van Weyenbergh said, which should yield results within two weeks. According to the report, some candidates are only interested in Brantano, while others have also shown an interest in acquiring other Macintosh-owned footwear stores.

Macintosh did not request suspension of payments for Brantano, the report added, which can be seen as a sign of confidence, according to Van Weyenbergh. For other Netherlands-based Macintosh-businesses, suspension of payments was granted by a court last week.

Van Weyenbergh told De Tijd he expects Brantano to be able to make it on its own through January, but by February things would get more difficult. However, by then there should be a buyer, he told the newspaper.

Overall, Van Weyenbergh is optimistic, according to the newspaper. He has confidence in the parties who have come forward, some of these businesses are investment funds, while others are already engaged in the footwear business, he told De Tijd reporters. Some of the interested parties possess a lot of money, Van Weyenberg said, which would be necessary for investments in upgrading its strores, so as to guarantee future survival of the brand, he added.

Last year Brantano had a turnover of EUR 151.8m, the report added.

De Tijd

>>> Asian Update

Asian Mid-session Update: Korea CPI rises to 16 month highs but remains below BOK target; CNY use in international transactions on the rise

***Economic Data***
- (AU) AUSTRALIA NOV PRIVATE SECTOR CREDIT M/M: 0.4% V 0.6%E; Y/Y: 6.6% V 6.8%E
- (KR) SOUTH KOREA DEC CPI M/M: 0.3% V 0.1%E; Y/Y: 1.3% (highest since Aug 2014) V 1.1%E; CPI CORE Y/Y: 2.4% V 2.4% PRIOR
- (SG) Singapore Nov M2 Money Supply Y/Y: 2.9% v 2.9% prior; M1 Money Supply Y/Y: -0.4% v -1.1% prior
- (UK) Weekly John Lewis Partnership LFL sales w/e Dec 26th: +2.3%

***Index Snapshot (as of 04:30 GMT)***
- Nikkei225 closed, S&P/ASX -0.2%, Kospi closed; Shanghai Composite -0.6%, Hang Seng +0.2%, Mar S&P500 +0.1% at 2,056

***Commodities/Fixed Income***
- Feb gold +0.2% at $1,062/oz, Feb crude oil +0.3% at $36.70/brl, Mar copper fat at $2.15/lb
- (CN) PBoC does not conduct open market operations in today's session; PBoC Drains CNY60B in the week through open market operations vs injected CNY30B last week; 2015 net injection CNY10B v CNY124B in 2014
- USD/CNY: (CN) PBoC sets yuan mid point at 6.4936 v 6.4895 prior; lowest setting since June 2011
- SWIFT: CNY use in international transactions rose to 2.3% of total in Nov v 1.9% prior

***Market Focal Points/FX***
- Asia's key equity indices were either closed for extended New Year's holidays or went out after a half day of generally listless action. Australia's ASX was down modestly on the day, closing 2015 off by nearly 2%. Hang Seng is also finished for 2015, rising marginally but falling over 7% for the year - the biggest annual loss since 2011. USD/JPY retreated 20pip below 120.40 from the highs, EUR/USD was in a 20pip band above 1.0915, and AUD/USD tested above the 0.73 handle with a 30+ pip advance from the lows. PBoC Yuan fix was again set at the weakest levels since 2011, as markets look to extended onshore trading session beginning next year.

- In economic data, South Korea CPI came in at a 16-month high of 1.3% y/y and core CPI was unchanged from the prior month. Also while the magnitude of annualized increase was unexpected, it was still well below the new BOK target of 2.0%. For 2015, y/y Korean CPI averaged just 0.7% - a record low. Bank of Korea gov Lee delivered his New Years address, pledging to maintain accommodative monetary policy next year amid rising household debt levels that poses a risk to the financial system. Lee said the central bank will work with authorities to curb household debt growth. In Australia, November private sector credit growth rates were below expectations, but December data on banking loan balances from APRA showed a bit of a bounce in sequential growth at +0.8% m/m. Mining names SFR and EVN were the worst performers on the ASX with declines of over 4%, while TPI, SYR, and ASB were up over 4%.

- In China, SWIFT's data showed the use of CNY in international transactions rose to 2.3% of total in Nov v 1.9% prior. CNY is making incremental progress in international use but still trails the majors - USD (42.7%), EUR (29.5%), GBP (8.9%), and JPY (2.7%). Separately, PBoC has deferred on further open market operations, and its overall 2015 net injection has come to a paltry CNY10B v CNY124B in 2014. Elsewhere, a researcher with the Commerce Ministry expressed confidence that inflation has bottomed and will not fall below 1% in 2016. Recall the latest CPI data in early Dec came in at 1.5%, moving off the 6-month lows. December figures will be released on Jan 8th.

***Equities***
US equities / ADRs:
- CHLN: Stockholders approve proposed 1-for-50,000 reverse stock split; Company to go private; +7.4% afterhours
- CMRX: Point72 Asset Management (Steve Cohen) discloses passive 5.3% stake - 13G filing; +3.8% afterhours
- VOD (+1.3% afterhours): Said to be in new merger talks with Liberty Global (+3.9% afterhours) with estimated value of £140B; Talks may take place in early 2016 - UK press
- TOSBF (Toshiba 6502.JP): Japan govt investment fund Innovation Network Corp. of Japan (INCJ) plans to support overhaul of electronics and other business units - Nikkei; +5.6%