>>> US Close Dow+2.27% S&P+2.44% Nasdaq+2.45% Russell+1.87%

Closing Market Summary: Nasdaq Leads Stocks Higher

The stock market registered its second consecutive advance on Thursday with the S&P 500 jumping 2.4% while the Nasdaq Composite (+2.5%) outperformed slightly. The market endured a late afternoon swoon, but was able to return to its high by the close.

Equities began the trading day on an upbeat note after the overnight session featured a rally across major global equity markets. China's Shanghai Composite took part in that move, soaring 5.3%, but the spike was reportedly aided by an intervention from the People's Bank of China.

Once the U.S. session got going, stocks followed the lead from Asia, rallying across the board with the energy sector pacing the advance. The growth-sensitive sector surged 5.0% while crude oil settled on its high, spiking 10.3% to $42.53/bbl., which represented the largest gain since 2009.

Similar to energy, the remaining nine sectors posted solid gains. Meanwhile, the S&P 500 surrendered 30 points in just an hour but reclaimed all 30 of those points during the next 30 minutes or so, highlighting the elevated volatility that has been in place as of late. To that point, at their Monday lows hit soon after the open, the Dow, Nasdaq, and S&P 500 were down 6.6%, 8.8%, and 5.3%, respectively. At their highs today, they were up 8.4%, 12.3%, and 6.6% from those lows, respectively.

Generally speaking, the indices have pivoted from being oversold on a short-term basis to being overbought on a short-term basis. The speed at which the sell-off and the rebound occurred has left everyone grappling to explain why it happened, what it means, and what comes next. No explanation is wholly sufficient and often matches the character of the market at the time it is provided.

While there might be reason to feel better about the market after the recent rebound, all this week's action truly succeeded in doing was damage retail investor psychology further and increase the level of uncertainty that was already in the market and had kept the S&P 500 range-bound.

On the corporate front, Avago Technologies (AVGO 126.26, +10.06) surged 8.7% after beating bottom-line estimates while the broader PHLX Semiconductor Index jumped 3.7%. For its part, the technology sector rallied 2.3%, settling not far behind the broader market.

Treasuries held gains during overnight action, but they slumped in the morning, hitting their lows right around 9:30 ET. After spending the morning in the red, the 10-yr note rallied off its low as stocks slid from highs. The benchmark note slipped from its afternoon high just ahead of the close, ending little changed with its yield at 2.18%.

Once again, participation was above average amid the heightened volatility with more than 1.2 billion shares changing hands at the NYSE floor.

Economic data included Initial Claims, Q2 GDP, and Pending Home Sales:

  • Initial jobless claims for the week ending August 22 declined by 6,000 to 271,000 while the consensus expected a reading of 275,000.
    • The prior week was left unrevised and there were no special factors affecting the latest claims report
    • The four-week moving average bumped up by 1,000 to 272,500
  • As expected, the second estimate for Q2 GDP produced an upward revision, but the surprise is that it was larger than expected
    • Q2 GDP was revised up to an annual growth rate of 3.7% from the advance estimate of 2.3% while the consensus estimate was looking for a jump to 3.1%
    • The drivers of the upward revision were personal consumption expenditures, nonresidential fixed investment, and private inventories
  • Pending home sales for July rose 0.5% while the consensus expected an increase of 1.0%

Tomorrow, July Personal Income (consensus 0.4%), Spending (expected 0.4%), and core PCE Prices (expected 0.1%) will be reported at 8:30 ET while the final reading of the Michigan Sentiment index for August (expected 93.0) will cross the wires at 10:00 ET.



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Portfolio Ticker Matches:  WRAPX



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>>> FCX +15% after hours : Icahn build a stake, find stock Undervalue

>>> FCX : Icahn has a position & intend to start discussion, see stock UV
Freeport-mcmoran Inc | Icahn Carl C: SC 13D
2015-08-27 20:03:48.539 GMT

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment ___)*
Freeport-McMoRan Inc.
(Name of Issuer)
common stock, par value $0.10 per share
(Title of Class of Securities)
35671D857
(CUSIP Number)
Jesse Lynn, Esq.
Icahn Capital LP
767 Fifth Avenue, 47^th Floor
New York, New York 10153
(212) 702-4300
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
August 17, 2015
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of Section 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g),
check the following box / /.
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d‑7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).

>>> Maurel & Prom to merge with MPI (Press Release)

Maurel & Prom to merge with MPI
The Boards of Directors of Maurel & Prom and MPI have unanimously approved the principle of a merger between the two companies under a merger by absorption of MPI by Maurel & Prom.

Reasons and objectives for the merger

Unlike the conditions which prevailed in 2011, Maurel & Prom and MPI currently have to face a difficult macroeconomic environment following the sudden drop in the price of oil, the lack of visibility related to their size, which limits their access to the best conditions that the financial markets have to offer and restricts their capacity for external growth in a capital-intensive industry.

The merger is a logical step in consolidation of the sector and would enable the new company to benefit from a reinforced financial capacity resulting from:

- a combination of significant cash flows from production in Gabon and Tanzania and dividends from Seplat in Nigeria;
- better access to financial markets; and
- substantial cost synergies and tax savings which, for example, would have represented EUR 14.5m for the 2014 financial year on a pro forma basis, of which EUR 12m in tax savings and EUR 2.5m in operating expenses corresponding to listing, structural and management costs of MPI.
The merger would also enable the new entity to benefit from an attractive combination of already developed onshore assets, offering a favourable oil (variable price)/gas (fixed price) product mix and greater geographic diversification combining (i) onshore operated assets generating substantial oil production with long-term visibility (Gabon) (ii) operated assets that began producing gas on 20 August 2015 offering exposure to East African countries (Tanzania), (iii) a significant stake (22%) in Seplat, one of the leading indigenous operators in Nigeria with strong potential for growth, (iv) significant upside development and appraisal potential in Canada and (v) exploration regions in Colombia, Myanmar and Namibia. Given the characteristics of these assets, the new merged company would assert itself as a leader among junior oil companies.

The consolidated entity would offer investors an attractive investment vehicle in terms of liquidity and market capitalisation, ranking it among the top-tier independent European oil exploration/production companies.

Terms of the merger

The proposed operation would take the form of a merger, in which MPI would be absorbed by Maurel & Prom. This merger must be approved by the General Shareholders’ Meetings of both companies in December 2015, with retroactive effect from 1 January 2015.

According to the indicative parity proposed by the Boards of Directors of Maurel & Prom and MPI, dated 27 August 2015, MPI shareholders would receive one Maurel & Prom share for two MPI shares.

The definitive exchange parity proposed to the shareholders of MPI and Maurel & Prom will be decided at the next meeting of the Maurel & Prom and MPI Boards of Directors, to be held mid-October, after the economic, financial, legal and operational terms of the merger have been examined over the next few weeks.

The indicative parity takes into account the payment of an exceptional dividend of EUR 45 cents per MPI share. This will be submitted for approval by the MPI General Shareholders’ Meeting called to approve the transaction and will be paid to shareholders on the condition precedent that the transaction is approved by the Maurel & Prom and MPI General Shareholders’ Meetings.

As part of the preparatory work for the transaction, the Boards of Directors of both Maurel & Prom and MPI also decided at their meetings on 30 July 2015 to put in place an ad hoc committee of directors, considered independent, for the purposes of the transaction, by their respective Board of Directors1. Each ad hoc committee is in particular responsible for analysing the terms under consideration for the planned merger and issuing recommendations to its Board of Directors, to enable them to make any decisions on the intended merger, including the exchange parity. In this respect, the ad hoc committee has recommended that its respective Board of Directors approve the merger by absorption of MPI by Maurel & Prom, as well as the proposed indicative parity for the transaction, and that they undertake an in-depth examination of the terms of the plan over the next few weeks.

At the recommendation of its ad hoc committee, the MPI Board of Directors has decided to voluntarily appoint the auditors Associés en finance, represented by M. Arnaud Jacquillat as an independent expert with a mandate to appraise the fairness of the financial conditions offered to MPI shareholders under the merger, it being stipulated that this independent expert must adhere to the regulations applicable to independent experts appointed pursuant to the General Regulations of the French Financial Markets Authority (Autorite des marches financiers, AMF). The work of the independent expert will be overseen by the ad hoc committee established by the MPI Board of Directors.

Maurel & Prom and MPI will also file a joint motion to appoint a merger auditor proposed by the ad hoc committees of the Maurel & Prom and MPI Boards of Directors to the Presiding Judge of the Paris Commercial Court. Pursuant to the applicable legal provisions and regulations, the merger auditor must check that the proposed parity is fair for all of the shareholders of Maurel & Prom and MPI.

The merger auditor’s report, the independent expert’s fairness opinion, the draft merger agreement and an information document on the transaction which will be registered by the Autorite des marches financiers will be available no later than one month before the General Shareholders’ Meetings of Maurel & Prom and MPI called to make a decision on the merger, pursuant to the applicable legal provisions and regulations.

The transaction will be subject to certain usual conditions precedent, particularly confirmation by the AMF that the merger will not result in any obligation for Pacifico to buy back the shares of Maurel & Prom and MPI under Article 236-6 of the AMF General Regulations.

(BFW) Maurel & Prom to Absorb MPI, See Substantial Synergies, Savings

ONE 08/27 15:58 Maurel & Prom: PLANNED MERGER BETWEEN MAUREL & PROM AND MPI
BN 08/27 16:02 *MAUREL & PROM: DEAL PRESENTATION AUG. 28 AT 10AM PARIS TIME
BN 08/27 16:02 *INDICATIVE PARITY TAKES INTO ACCOUNT €45C/MPI SHR SPECIAL DIV
BN 08/27 16:01 *MAUREL & PROM: INDICATIVE PARITY TAKES INTO ACCOUNT DIV OF €45C
BN 08/27 16:01 *MPI HOLDERS TO GET 1 MAUREL & PROM SHR FOR 2 MPI SHRS
BN 08/27 16:00 *MAUREL & PROM TO ABSORB MPI
BN 08/27 15:59 *MAUREL MPI HOLDERS WOULD GET 1 MAUREL & PROM SHR FOR 2 MPI SHRS
Maurel & Prom to Absorb MPI, See Substantial Synergies, Savings
2015-08-27 16:19:20.251 GMT


By Gaurav Panchal
(Bloomberg) -- Maurel & Prom, MPI boards agree to merge via
absorption of MPI by Maurel & Prom, with MPI shareholders
getting one Maurel & Prom share for two MPI shares.

* Based on Aug. 27 close price of Maurel & Prom, indicative
offer values MPI at EU2.345/shr, or EU270.4m
* MPI shrs close at EU2.52/shr
* Definitive exchange parity proposed to shareholders of MPI,
Maurel & Prom to be decided at next meeting of Maurel & Prom
and MPI boards in mid-Oct.
* Indicative parity takes into account payment of an
exceptional div. of EU45c per MPI share
* Merger must be approved by general shareholders’ meetings of
both companies in Dec., with retroactive effect from Jan 1
* Savings/Synergies:
* Cos. see substantial cost synergies and tax savings
* Says would have represented EU14.5m for 2014 on a pro
forma basis, of which EU12m in tax savings and EU2.5m in
operating expenses corresponding to listing, structural
and management costs of MPI
* Deal presentation at 10am Paris on Aug. 28
* Link: http://edge.media-server.com/m/p/m8wepxjk/lan/en
* Statement:Link


Link to Company News:{MAU FP <Equity> CN <GO>}
Link to Company News:{MPI FP <Equity> CN <GO>}

For Related News and Information:
First Word scrolling panel: {FIRST<GO>}
First Word newswire: {NH BFW<GO>}

To contact the reporter on this story:
Gaurav Panchal in London at +44-20-3525-0511 or
gpanchal2@bloomberg.net

To contact the editor responsible for this story:
Brian Lysaght at +44-20-3525-7908 or
blysaght@bloomberg.net

(BofA-ML) Sept Fed hike






Bottom Line: Despite dovish comments from Dudley and a more dovish Lockhart earlier in the week, our US economics team are still calling for a September rate hike. Given the market is only pricing in 15% probability of a hike in September and less than 50% chance of a hike by year end, this is quite an out of consensus call. Our baseline forecast is that markets calm over the next three weeks, data stays positive and Fed hikes in September.

 



We expect 2Q GDP growth to be revised up from 2.3 to 3.4% today and we continue to track 2.8% growth in 3Q.


More important, the Fed is clearly putting a big emphasis on the labour market and they are getting just what they want:

 

·         Payroll growth has averaged 211k this year and shows no sign of slowing.

 

·         Both the narrow (U3) and broad (U6) unemployment rate continue to trend lower, falling 0.3 and 0.8% respectively this year.

 

Inflation remains low, but “the Committee expects inflation to rise gradually toward 2 percent over the medium term as the labour market improves further and the transitory effects of earlier declines in energy and import prices dissipate.”

 

Stripping out energy and import prices, PCE inflation is running at about 1.5% and is inching higher. As we have argued, the Fed seems to be relying on the job market to meet both its employment and inflation objectives.

 

Given the stark contrast between the domestic data and the markets, this is one of those moments where it is important to consider multiple scenarios:

 

(1) Our baseline forecast is that markets calm over the next 3 weeks, data stays positive and Fed hikes in September.

 

(2) Market turmoil is slow to abate, but data remains healthy, delaying the first hike to October or December. This seems like the second most likely scenario.

 

(3)Market turmoil first delays the Fed, and then starts to have a significant negative impact on the macro data. This pushes out the first hike well into next year, or indefinitely.

 

 

 

Related Research

US Economic Watch: When the data say “go” but the markets say “no”


•   We reiterate our baseline forecast for the Fed to hike in September: if markets settle down, the Fed is on track to exit.
•   In the event of continued market turmoil, the Fed may push the first hike to Oct/Dec. This is a risk to our baseline.
•   A more severe shock to the real economy (although this is not our base case) could result in a more notable delay.

 Click for full report*


1716026

(CS) Cash is Leaving Both Bond and Equity Funds



US Economics Digest

Cash is Leaving Both Bond and Equity Funds

* Net new mutual fund cash flows are starting to get interesting after a relatively benign stretch in 2014 and the first half of 2015.

* Households typically use mutual funds to save for such long-term goals as saving for college or preparing for retirement. Many household investments into these funds are made through regular payroll deductions, which help steady the funds' net new cash flows, even during periods of market turbulence.

* When we do see unusual flows out of (or even into) mutual funds, we take notice. Such changes in retail investment behavior can help us identify inflection points in household attitudes toward risk.

* In this note, we review mutual fund cash flows from the financial crisis to the latest monthly data – through June 2015 – provided by the Investment Company Institute (ICI).

* Also, we observe that the latest weekly estimates from the ICI indicate these retail investment outflows began gaining strength in Q3 2015. Data to date suggest that we will see the first example of back-to-back monthly outflows from both equity and bond mutual funds (in July and August 2015) since Q4 2008. 

WSJ : A Healthy Side of Insurer Mega-Mergers



A Healthy Side of Insurer Mega-Mergers

As hospitals consolidate, more market power is needed to bargain for better prices.
Anthem’s proposed merger with Cigna following Aetna ’s acquisition of Humana has set off alarms about lack of competition in the health-insurance industry. But policy makers should consider the potential benefits of industry consolidation. The greater efficiency and market power of larger insurance plans could lower prices for consumers by offsetting the bargaining power of health-care providers.

In many U.S. communities there are only one or two hospitals, which dictate the cost of care. A recent report by Kaufman, Hall & Associates LLC showed that the number of hospital mergers and acquisitions increased 44% between 2010 and 2014. There is a similar problem with specialist physicians who, through consolidation of practices, control of entry and other arrangements, have considerable market power.

Insurance companies can act as a counterweight, and lower prices will get passed along to consumers instead of increasing insurance-company profits. That’s because the Affordable Care Act requires insurers to spend at least 80%-85% of every premium dollar on consumer medical claims and activities that improve the quality of care.

Moreover, health-insurance companies now must take all customers, regardless of their health, and under the Affordable Care Act, risk adjustment payments move money from health plans that enroll healthier populations to those with sicker people. Health insurance is no longer about “avoiding sick people.”



Apart from these nationwide rules, state exchanges can improve the operation of insurance markets. Covered California, the state exchange established under the Affordable Care Act, requires insurers selling coverage through the exchange to provide uniform benefits on top of minimum essential coverage. By creating standard benefit designs—in which most care is not subject to deductibles—health plans compete on price and provider availability rather than on differences in deductibles, copayments and coinsurance that are largely incomprehensible to most consumers. Consumers win by being able to make apples-to-apples comparisons.

Covered California will offer a total of 12 insurers in 2016, up from 10 in 2015. In some local markets consumers will have a choice of seven different insurers. While consolidation of insurance companies is a potential threat to consumers in regions where there are only a small number of plans, the bigger threat is from the consolidation of health-care providers and from pharmaceutical prices.

Consider the difference in premiums between Northern and Southern California. Covered California recently announced an average premium increase of 4% statewide for 2016 compared with 2015. The average increase was 1.8% in Southern California, but in Northern California the average increase was 7%. This increase came on top of already markedly higher costs in Northern California. Today, the average annual health-insurance premiums for individuals are 30% higher in the north than in the south. This price difference is not due to a lack of competition among large insurers. Rather it is mostly attributable to the higher prices charged by hospitals and physicians.

The other great problem is the ability of pharmaceutical and biotechnology companies to charge whatever the market will bear. According to a January 2015 analysis by Aswath Damodaran, a professor at New York University’s Stern School of Business, the average yearly profit margin for the top 151 pharmaceutical companies world-wide is more than 24% and for the top 400 biotech firms it is nearly 23%.

Gilead Sciences Inc., which sells Sovaldi and Harvoni, the recently approved hepatitis C treatments, is doing far better than average. These drugs currently cost from $60,000 to $90,000 for a three-month treatment. Gilead recently raised its full-year profit-margin forecast to 88% largely on the sale of these two drugs. These huge profits get baked into health-insurance premiums.

Meanwhile, the average annual profit margin for insurance plans offered by Covered California is just 1.1%.

Large insurance companies can make a major contribution to health-care costs by fostering changes in how health care is paid for and delivered. Many insurers are organizing or contracting with Accountable Care Organizations that provide care for a defined population for a fixed annual fee, or with penalties and rewards linked to the quality and cost of care provided. This is one example of how those who pay for health care can join with Medicare in the move from a health-care system that rewards volume to one that rewards value.

It is easy to decry the evils of large insurance companies. But they are in a unique position to raise the quality and lower the costs of American health care.