WSJ : Qualcomm to Conduct Strategic Review, May Consider Breakup

Qualcomm to Conduct Strategic Review, May Consider Breakup

Chip maker may also look at returning more cash to shareholders after activist investor presses for change

Qualcomm Inc. is expected to conduct a sweeping strategic review that will look at the possibility of a breakup, among other options, after an activist investor pushed for change at the chip maker.

Qualcomm, the world’s largest maker of chips used in mobile phones, may announce it is considering that and other options—including returning more cash to shareholders—when it reports fiscal third-quarter results Wednesday, according to people familiar with the matter. The company’s plans are in flux and there is no guarantee it will make any such announcement then, the people cautioned.

The potential moves Qualcomm is expected to flag largely track suggestions the activist, Jana Partners LLC, has made since it revealed a stake of more than $2 billion in the San Diego company in April. Jana, an $11 billion New York hedge fund, has urged Qualcomm to explore a breakup, cut costs, repurchase shares faster and bring new blood to its board.

As part of its review, Qualcomm, which has a market capitalization of $104 billion, may also reshuffle its board and give Jana a say in adding independent directors, the people said.

A Qualcomm spokeswoman declined to comment, referring to the company’s statement in April in which it said it looks at its corporate structure from time to time but that earlier reviews have concluded shareholders are better off with the current configuration.

Steve Mollenkopf, Qualcomm’s chief executive, said around that time the company wasn’t pleased with its financial outlook and had initiated a “comprehensive review” of its cost structure. He said the company would report on the initiative when its reports results this week.

Any breakup of the company would likely separate Qualcomm’s chip-production business from its patent-licensing operation. The company, which has a market capitalization of $104 billion, gets about two-thirds of its roughly $26 billion in annual revenue from the chip business. But about two-thirds of its roughly $8 billion in yearly profit comes from royalties from the sale of smartphones that use technology it pioneered.

Should the company break up, it would be the latest technology giant to reshape itself amid lackluster results and disappointing share-price performance. This month, Hewlett-Packard Co. filed paperwork to split itself into two publicly traded companies. On Monday, PayPal Holdings Inc., formerly the online-payments arm of eBay Inc., began trading on its own.

Qualcomm has already taken steps to boost its stock price, which is down 14% this year. They include a $15 billion stock buyback announced in March, with $10 billion set to be repurchased in the next 12 months, a move Jana had called a good first step. Qualcomm stock fell by less than 1% on Monday to close at $63.79 on Nasdaq.

The company has forecast its per-share earnings for the quarter at 85 cents to $1, down from $1.44 a year earlier, and revenue between $5.4 billion and $6.2 billion, down from $6.8 billion—both below Wall Street expectations at the time.

The move to explore a wide range of options will likely be viewed as another successful activist push for Jana. Just weeks ago, food company ConAgra Inc. agreed to exit its struggling private-brands business, a move the hedge fund had advocated.

Qualcomm has seriously considered splitting into two for years, according to people familiar with the matter. About 15 years ago, the company announced a split and filed securities documents for the plan before scrapping it after signing several large licensing deals that eased concerns customers were growing wary of competing against both sides of Qualcomm.

While defending its current corporate structure, Qualcomm executives have said they regularly evaluate whether it makes sense to keep the chip and patent-licensing businesses together.

A proposed split would also come at a time of rapid consolidation among chip companies as they try to gain scale to better cope with rising semiconductor input costs.

So far this year, there have been $87.4 billion in announced semiconductor deals, according to Dealogic. That is more than the volume for any full year on record.

In early March, NXP Semiconductors NV agreed to buy Freescale Semiconductor Ltd. for $11.8 billion. Next, Avago Technologies Ltd. struck a $37 billion deal to buy Broadcom Corp.—the largest pure-technology deal ever. Then Intel Corp. agreed to purchase Altera Corp. for $16.7 billion.

Analysts at Arete Research Services LLP earlier this year said that a broken-up Qualcomm could enter the deal-making boom. The analysts estimated the chip-making business could have a market valuation of $74 billion, while the patent division could be valued at $87 billion and suggested an independent chip business could be attractive to suitors such as Intel.

>>> What to look at today - 21st of July 2015

Dow+0.08% S&P+0.08% NAsdaq+0.17% Russell-0.54%
US Market closed near the flat line after testing May high. Seven sectors ended the day with gains while energy (-1.3%), materials (-0.9%), and utilities (-0.5%) spent the session below their flat lines. The energy sector retreated alongside crude oil, which fell 1.6% to $50.40/bbl. Meanwhile, the growth-sensitive sector struggled throughout the session, widening its July loss to 4.5%, even afterHalliburton (HAL 40.75, +0.76) climbed 1.9% after reporting better than expected results. volume were light at 720mil shares...US After Hours SANM +11.4%, CNI +3.1%, BSX +2.3%, IBM -5.0%, HXL -2.7%, WERN -1.1% following earnings/guidance...QCOM +2.7% on on potential strategic review, possible breakup...Asia indices are mixed again in the absence of conviction in trading on Wall St or significant economic data. Shanghai Composite opened down by over 1% but has since come off those lows and approaching its midday break with an upswing above 4,000. PBoC official Sheng said the central bank would continued to maintain liquidity at a moderate level. To that end, in its latest OMO operation PBoC injected another CNY35B through 7-day reverse repos. Also of note, non-broker margin lenders in China had reportedly requested that clients sell off some of their stock holdings purchased with margin debt - further evidence regulators are looking to rein in some of the recent volatility fanned by runaway credit. The BOJ put out a set of meeting minutes, though this release was outdated relative to the more recent decision when the central bank cut its GDP and inflation forecasts. In its June 18th meeting, many members agreed the easing is having intended effects, though a minority also remarked the effects might be diminishing given the recent runup in JGB yields. FX traders interpreted that sentiment as boosting the possibility of more aggressive policy response, and USD/JPY rose some 10pips following the comments toward 124.40 - a 1-month high.

Nikkei +0.85% Hang Seng +0.75% Shanghai +1.12%

Eur$ 1.0815 JPY 124.45 GBP 1.5562 EURCHF 1.0436 RUB $57.0671 WTI $49.95 (-0.4%)

S&P +0.11% EuroStoxx +0.16% Dax+0.18% SMI+0.09%

Macro :
- Oil Slides Below $50 as Gold Holds Losses; Asian Stocks Advance
- Oil Guru Who Called 2014 Slump Sees Return to $100 Crude by 2020
- Greek Euro Exit Back on the Agenda Next Year, Economists Say
- Wheat Heads for Longest Slump in a Year as Harvest Progresses

Keep an eye on :
- AIR FP : EVA Airways to Acquire 24-26 Boeing or Airbus Passenger Planes
- ATLN VX : Actelion Raises Full-Yr Outlook; 1H Core Earnings Beat Estimate
- AKZA NA : Akzo Nobel 2Q Sales Beat Estimates, Says on Track for 2015 Goals
- AZM IM : Azimut Most at Risk Among Italy Asset Managers: MainFirst
- SAN SM : Santander to Close Vista Private Equity Fund: Expansion
- BON FP : Bonduelle Said to Plan Bid for GIS’ Green Giant: Reuters Link : http://reut.rs/1TNpsUh
- ZEX GY : Tom Tom: Bosch and TomTom partner on innovative mapping technology for automated driving
- BPTY LN : GVC Said to Consider Bwin.party Bid Without Amaya: Telegraph
- ENG SM : Enagas 1H Ebitda Misses, Net Beats; Regulated Sales Fall Y/y
- ENEL IM : Prosperity Capital Buys 5.18% Enel Russia From EBRD: Vedomosti
- RMS FP : Hermes 2Q Sales Beat Ests., Sees 1H Oper. Profit Down ‘Slightly’
- NHY NO : Norsk Hydro 2Q Underlying Net Income Beats Estimates
- NOVN VX : Novartis 2Q Net Sales, Core Oper Profit in Line; Keeps Forecast, Lifts Sales Forecast for Sandoz, Lowers for Alcon, CEO Sees Biosimilars Growing 20% to 30% Per Quarter, Profit Drops as U.S. Dollar Strength Erodes Sales
- OCI NA : OCI Materials preliminary bids due August; Taiyo Nippon Sanso among suitors - Deal Reporter
- ORA FP : Orange in Talks to Buy Four Bharti Airtel Units in Africa
- PINF IM : Pininfarina talks with Mahindra & Mahindra may be back on agenda - Il Messaggero
- PMO LN : Premier Oil Sees High Chance of Oil in Mexico Block: Director
- PSM GY : ProSiebenSat1 in Talks to Take Scout24 Stake: Handelsblatt
- RCO FP : Remy 1Q Sales Miss Ests., Confirms FY Target
- RNO FP : Renault Considers Selling Low-Cost Crossover in Iran: Reuters
- SAP GY : SAP 2Q Earnings In Line; Cloud Subscription Rev. Beats, May Enact ’Targeted’ Job Cuts in 2016, CFO Says
- SRT3 GY : Sartorius 2Q Adj. Ebitda EU63.6m vs EU46.2m
- TEL2B SS : Tele2 2Q Ebitda Slightly Below Est.; Keeps 2015 Forecast
- TRELB SS : Trelleborg 2Q Pretax Beats Est.; Sees 3Q Demand on Par W/ 2Q
- TSCO LN : Dunnhumby’s new data agreement with Tesco could lower sale price; talk of Tesco abandoning auction SKy News Link : http://bit.ly/1JtF3kL
- TOM2 NA : TomTom 2Q Sales, Ebit Beat Ests.; Keeps FY Outlook, Names CFO
- UNR1V FH : Uponor 2Q Sales, Profit Miss Ests.; Repeats 2015 Outlook
- VOW3 GY : LG Chem Denies Report on 6.9t Won of Battery Order From Audi
- ZAL GY : Zalando Says 2Q Rev. EU727m-EU738m vs Est. EU688m

>>> Europe : Brokers Upgrades & Downgrades - 21st of July 2015

>>> Up
*AB INBEV CUT TO NEUTRAL VS BUY AT NOMURA
*CONTINENTAL AG RAISED TO BUY FROM HOLD AT HSBC
*EVRAZ RAISED TO HOLD VS UNDERPERFORM AT JEFFERIES
*FERRAGAMO MOVED TO STRONG BUY VS OUTPERFORM AT RAYMOND JAMES
*ICADE RAISED TO BUY VS HOLD AT SOCIETE GENERALE, PT EU85
*SABMILLER RAISED TO BUY VS NEUTRAL AT NOMURA

>>> Down
*GECINA CUT TO HOLD VS BUY AT SOCIETE GENERALE
*JCDECAUX CUT TO HOLD VS BUY AT BERENBERG
*MAPFRE CUT TO REDUCE VS BUY AT NOMURA
*ONTEX CUT TO UNDERWEIGHT VS NEUTRAL AT JPMORGAN
*ROCKWOOL INTERNATIONAL CUT TO HOLD AT HSBC
*SMA SOLAR TECHNOLOGY CUT TO REDUCE AT HSBC
*STABILUS CUT TO NEUTRAL VS OVERWEIGHT AT JPMORGAN

>>> PT Change


>>> Initiation
*AB INBEV RATED NEW BUY AT STERNE AGEE CRT, PT $147
*CITYCON REINSTATED NEUTRAL AT GOLDMAN
*DIAGEO RATED NEW BUY AT STERNE AGEE CRT, PT $137
*SILTRONIC RATED NEW NEUTRAL AT CITI, PT EU36
*TOD'S RATED NEW UNDERPERFORM AT RAYMOND JAMES, PT EU72
*TOWN CENTRE SECURITIES RATED NEW BUY AT LIBERUM, PT 355P
*ZALANDO RATED NEW BUY AT BAADER-HELVEA, PT EU40 (YESTERDAY)


>>> Call

>>> Pininfarina talks with Mahindra & Mahindra may be back on agenda – report (t

Pininfarina talks with Mahindra & Mahindra may be back on agenda 

Listed Italian car design company Pininfarina could restart talks over a sale with Mahindra & Mahindra (M&M), Italian language daily Il Messaggero reported. The unsourced report said that the path to reopening negotiations was opened by the loss of a court case by former Pininfarina workers whose production facility was sold to the De Tomaso car group demanding to be re-employed by Pininfarina.

As previously reported, M&M was set to invest up to EUR 80m in taking control of Pininfarina. Some 76% of holding company Pincar is held by Pininfarina's creditor banks, the most exposed of which are Intesa Sanpaolo, Banco Popolare, Unicredit and UBI Banca, as previously reported.

Il Messaggero

>>> OCI Materials preliminary bids due August; Taiyo Nippon Sanso among suitors

Deal Reporter

OCI Materials preliminary bids due August; Taiyo Nippon Sanso among suitors – sources
OCI [KRX: 010060] has dispatched information memorandum for the proposed sale of OCI Materials [KOSDAQ: 036490] to multiple domestic and foreign suitors and is preparing to receive preliminary bids by early August, it is understood. Qualified suitors will move ahead with due diligence during August, it was said.

Japan’s Taiyo Nippon Sanso [TYO: 4091] has been in talks for the potential acquisition of OCI Materials, but has not reached a final decision on whether it will move forward with placing a bid, a company spokesperson confirmed. He was responding to a request for comment from this news service following claims from an industry source that the Japanese firm was interested in bidding for the company.

Taiyo Nippon Sanso currently purchases, bottles, and sells industrial gases, including NF3, SiH4, and WF6 from OCI Materials, according to the Taiyo spokesperson. The potential acquisition could allow Taiyo to secure production facilities to enhance its procurement network. However, the spokesperson acknowledged that the industry was mature and that it was unlikely to grow significantly going forward.

Meanwhile, a Chinese bidder is also in discussions to buy OCI Materials, a source familiar with the situation said.

The Chinese bidders could be the most likely suitors, two bankers following the situation and the source familiar said. Chinese companies are generally keen to expand in the semiconductor and display sector as encouraged by the government, the source familiar said, pointing to state-run Tsinghua Unigroup’s reported USD 23bn bid to acquire US-based chipmaker Micron Technology.

Foreign bidders could be attracted to the target’s large production capacity and existing relationships with two major clients Samsung and LG Electronics, said two bankers following the situation. However, the high valuation and cyclical nature of the business could prove to be hurdles, they noted, adding that there could be a price gap.

Shares of OCI Materials shot up 159% this year, valuing the company at KRW 1.46tn (USD 1.23bn). The current high trading multiple, more than four times book value, and uncertainty over global supply and demand in the next few years could be risk factors, the second banker explained.

OCI said on 10 June that it had hired Credit Suisse to sell a controlling 49.1% stake in OCI Materials to focus on its solar energy business. OCI Materials manufactures industrial gases such as NF3, SiH4, and WF6 for the production of semiconductors, LCD panels, and solar batteries. It is the largest producer of NF3 globally.

Air Products Korea, DaeSung Industrial Gases, and Hyosung are competitors in the field of NF3 in Korea, a third banker said.

Total domestic production of NF3 was 17,000 tons in 2014. Hyosung, which focuses on development of specialty gas/materials, is working to upgrade production of NF3 to 3,500 tons from 2,000 tons, according to a May report from IBK Securities.

Hyosung expects to increase production supply of NF3 from 2Q16, while DaeSung is also looking to increase production from next year, which will result in an increase of 3,000 tons of NF3 in total, an analyst at IBK Securities said.

However, the increase in capacity is unlikely to immediately affect OCI Materials’ profitability as Samsung Electronics expects demand to be resilient for a while, the analyst said. Although OCI Materials has a high operating profit ratio of about 30%, and solid earning prospect for FY15, the company is rather overvalued at this moment, the analyst added.

OCI Materials is estimated to record sales of KRW 319bn and operating profits of KRW 99bn this year, 50% and 280% up YoY, according to a June research report from eBest Investment Securities.

Sale proceeds

OCI said this morning that it sold OCI Resources [NYSE:OCIR] to Park Holding AS, a subsidiary of Ciner Group of Istanbul for USD 465m.

The company plans to use the proceeds of the non-core asset sale to invest in solar power plants, ESS (energy storage system), and its chemical materials business, said an OCI spokesperson. OCI has not finalized details of its investment strategy of the ESS and chemical businesses as yet, he said.

With regards to its solar power plant project, OCI has been working for Alamo project in Texas, US; seven solar power plants that require about KRW 1.3tn of investment in total. The company has completed half of the project, and expects to finish it by the end of next year, the spokesperson said. The asset sale is also expected to help to minimize the company’s mounting liabilities, as reported. OCI had an approximate debt to equity ratio of 120% in 1Q15.

Shares of OCI were up 5.56% at KRW 123,500 on Tuesday afternoon.

>>> Bosch Partners with TomTom on innovative mapping technology for automated dr

Partners with TomTom on innovative mapping technology for automated driving 
- High-precision maps are essential for highly automated driving
- Bosch is using TomTom maps in its automated test vehicles
- Freeways and freeway-like roads in Germany to be digitized for automated driving by the end of 2015
- Maps for highly automated driving have to be accurate to decimeter precision
- Collaboration will result in innovative vehicle positioning concepts

(BN) Oil Guru Who Called 2014 Slump Sees Return to $100 Crude by 2020

Oil Guru Who Called 2014 Slump Sees Return to $100 Crude by 2020
2015-07-21 05:16:33.107 GMT


By Javier Blas and Grant Smith
(Bloomberg) -- The oil guru who predicted last year’s rout
said $100-a-barrel crude is likely to return within five years
as faltering supply fails to meet demand.
Gary Ross, the founder of consultants PIRA Energy Group,
said oil markets aren’t nearly as oversupplied as many believe
and spare capacity is tight since Saudi Arabia is pumping all
the crude it can without new drilling.
“Current prices are unsustainable,” he said Monday in an
interview in London. “It’s hard not to see oil hitting $100 a
barrel at some point in the next five years.”
The forecast from Ross, who last year turned bearish on oil
before prices shrank by half, is at odds with other analysts and
investors bracing for “lower for longer” prices, a term coined
by BP Plc Chief Executive Officer Bob Dudley. Saudi Oil Minister
Ali Al Naimi said in December the world may not see $100 crude
again, while the International Energy Agency has described the
markets as “massively oversupplied.”
Such views fail to take into account the impact of $50 oil
on output outside North America as producers reduce spending,
according to Ross. The likelihood of further disruption to OPEC
supplies and the boost to consumption from cheap fuel also
support prices, he said.
Brent crude, the global benchmark grade, lost 10 cents to
$56.55 a barrel on the London-based ICE Futures Europe exchange
at 1:06 p.m. Singapore time on Tuesday. West Texas Intermediate
oil fell 18 cents to $49.97.

Policy Change

PIRA hosted a seminar in New York in October where Saudi
officials hinted they would change their oil policy. OPEC’s
biggest oil-exporting nation announced weeks later that it would
maintain production to defend market share, sending prices
plunging.
Saudi Arabia has already exhausted its ability to ramp up
“instantaneous” production in the event of an outage, Ross
said. The kingdom, which pumped a record of almost 10.6 million
barrels a day in June, could raise output by 1 million barrels a
day in 90 days with extra drilling, he said. That’s about half
the spare capacity estimated by the Paris-based IEA.
“There’s not spare capacity to speak of instantly
available,” Ross said. There are also growing geopolitical
threats to supply, including from Islamic State, he said.
PIRA forecasts a jump in global oil demand of about 1.7
million barrels a day this year and a similar gain in 2016. That
exceeds the 10-year average increase of about 1 million barrels
a day. It sees strong demand in Europe, the U.S. and Japan.

Tighter Supply

Supplies from most countries outside the Organization of
Petroleum Exporting Countries will contract next year for the
first time since 2008. While output in North America will
increase, production from Australia, the North Sea, Colombia and
Argentina will decline, according to PIRA.
Even higher exports from Iran following the landmark July
14 accord to ease sanctions may do little to check oil’s
advance, Ross said. The increase may be limited to less than
500,000 barrels a day over six months and the country will
struggle to sell its condensate stockpiled on tankers, he said.
Hedge funds and other speculators, having cut bullish bets
on WTI crude to the lowest level since March, may be ready to
start buying again as low prices cause the market to tighten.
“We are approaching selling exhaustion,” Ross said. “The
magic of prices works.”

For Related News and Information:
Saudis Pump Record Oil as OPEC Sees Stronger Demand in 2016
Saudi Arabia Pumps Oil Flat Out in Citi, Goldman’s New Oil Order

--With assistance from Angelina Rascouet in London.

To contact the reporters on this story:
Javier Blas in London at +44-203-525-9426 or
jblas3@bloomberg.net;
Grant Smith in London at +44-20-3525-7353 or
gsmith52@bloomberg.net
To contact the editors responsible for this story:
Will Kennedy at +44-20-3525-3603 or
wkennedy3@bloomberg.net
Amanda Jordan, Randall Hackley

Reuters - Bonduelle prepares bid for Green Giant

Bonduelle prepares bid for Green Giant Link : http://reut.rs/1TNpsUh


French food group Bonduelle SCA (BOND.PA) is in discussions to team up with Centerview Partners in a bid to acquire General Mills Inc's (GIS.N) Green Giant frozen and canned vegetable business, according to people familiar with the matter.

Joining with the private equity arm of investment bank Centerview would give Bonduelle, which has a market capitalization of 796 million euros ($861 million), more capital and additional expertise in its pursuit of Green Giant.

The potential consortium of Bonduelle and Centerview would compete against other bidders for the asset, and there is no certainty that Bonduelle's offer would prevail, the people said on Monday.

The sources asked not to be identified because details of the sale process are confidential. General Mills and Centerview declined to comment. Bonduelle could not be immediately reached for comment.
Minneapolis-based General Gillis hired investment bank Rothschild to explore a sale of Green Giant, Reuters reported in March. Green Giant has approximately $700 million in annual revenue, sources told Reuters at the time.

Green Giant, whose mascot is the Jolly Green Giant, makes more than 160 different products, including steamed and canned vegetables, corn on the cob, chips and hummus.
Green Giant has struggled as consumer preferences shift away from sauced varieties towards more plain vegetables, Jeff Harmening, chief operating officer at General Mills, told investors and analysts at the company's fiscal 2016 investor day last week.

Based in Villeneuve d'Ascq, France, Bonduelle owns manufacturing facilities in Canada that produce canned goods for Green Giant. Bonduelle Chief Executive Christophe Bonduelle told French newspaper Les Echos in 2010 the company would be interested in acquiring Green Giant but not at any cost.
Green Giant would not be the Bonduelle's first North American acquisition. It has also purchased certain vegetable operations from Allens, a U.S.-based canned and frozen vegetable company, and Canadian vegetable companies Omstead Foods, Family Tradition Foods and Aliments Carrière.

>>> Asian Update

Asian Mid-session Update: Shanghai shrugs deleveraging calls as PBoC continues to inject liquidity

***Economic Data***
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 111.8 V 107.0 prior
- (CN) China Jun Foreign Direct Investment (FDI) Y/Y: 0.7% v 0.5%e
- (NZ) NEW ZEALAND JUL RETAIL CREDIT CARD SPENDING M/M: 0.3% V 1.9% PRIOR; Y/Y 6.5% V 7.1% PRIOR
- (NZ) New Zealand Jun Net Migration: 4.8K v 5.1K prior

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 +0.4%, S&P/ASX +0.3%, Kospi flat, Shanghai Composite -0.6%, Hang Seng +0.3%, Sept S&P500 -0.1% at 2,120

***Commodities/Fixed Income***
- Aug gold -0.3% at $1,103/oz, Sept crude oil -0.3% at $50.30/brl, Sept copper +0.3% at $2.49/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 1.8 tonnes to 694.5 tonnes; lowest since Sept 2008
- USD/CNY: PBoC sets yuan mid point at 6.1199 v 6.1197 prior setting (weakest Yuan setting since Jun 8th)
- (CN) PBoC to inject CNY35B in 7-day reverse repos (8th consecutive injection); Offer yield at 2.5%, unchanged from prior
- (JP) BOJ offers to buy ¥70B in JGBs with maturity less than 1-yr and ¥400B in 5-10yr JGBs

***Market Focal Points/FX***
- Asia indices are mixed again in the absence of conviction in trading on Wall St or significant economic data. Shanghai Composite opened down by over 1% but has since come off those lows and approaching its midday break with an upswing above 4,000. Australia's ASX200 is also up about 0.4% halfway through its session, even though quarterly production metrics from some of its miners remain underwhelming.

- Among notable local press reports, PBoC official Sheng said the central bank would continued to maintain liquidity at a moderate level. To that end, in its latest OMO operation PBoC injected another CNY35B through 7-day reverse repos. Also of note, non-broker margin lenders in China had reportedly requested that clients sell off some of their stock holdings purchased with margin debt - further evidence regulators are looking to rein in some of the recent volatility fanned by runaway credit.

- RBA released the minutes of its July meeting and continued to straddle both sides of the fence, which is likely to keep expectations of further policy easing in check. On the one hand, RBA warned the strength in Q1 GDP had not carried over into Q2. On the other, the central bank notes significant labor demand which should succeed in lowering Australia's jobless rate further. RBA reiterated inflationary pressure is well contained and called for further AUD decline to assist economic recovery. After some initial volatility on the release, AUD/USD sold off by about 20pips toward $0.7350 following minutes release. In contrast, NZD/USD rallied about 50pips toward $0.66 on bargain hunting.

- The BOJ also put out a set of meeting minutes, though this release was outdated relative to the more recent decision when the central bank cut its GDP and inflation forecasts. In its June 18th meeting, many members agreed the easing is having intended effects, though a minority also remarked the effects might be diminishing given the recent runup in JGB yields. FX traders interpreted that sentiment as boosting the possibility of more aggressive policy response, and USD/JPY rose some 10pips following the comments toward 124.40 - a 1-month high.

***Equities***
US equities / ADRs:
- QCOM: Said to be preparing to conduct a large-scale strategic review that may lead to possible breakup; May also boost shareholder returns - financial press; +2.7% afterhours
- CNI: Reports Q2 C$1.15 v C$1.03 y/y, Rev C$3.13B v C$3.12B y/y; +0.9% afterhours
- STLD: Reports Q2 $0.22 v $0.22e, R$2.01B v $2.08Be; +0.6% afterhours
- IBM: Reports Q2 $3.84 v $3.80e, R$20.8B v $21.0Be; -5.3% afterhours

Notable movers by sector:
- Consumer discretionary: Spring Airlines Co 601021.CN -10.0% (private placement)
- Financials: China Pacific Insurance Group 2601.HK +3.9% (H1 guidance)
- Industrials: Tianjin Marine Shipping 600751.CN +5.5% (H1 guidance); Sinosteel Engineering & Technology Co L 000928.CN -4.0% (H1 result); CPI Yuanda Environmental-Protection Group 600292.CN +2.0% (H1 result); Dongfang Electric Corp 600875.CN -2.9% (H1 guidance); Macquarie Atlas Roads Group MQA.AU +5.1% (Q2 result); Daewoo Shipbuilding & Marine 042660.KR +17.1% (layoff speculation)
- Technology: Toshiba Corporation 6502.JP +3.7% (accounting irregularities update)
- Materials: Evolution Mining EVN.AU +2.6% (Q4 result); OZ Minerals OZL.AU -2.0% (Q2 result)
- Energy: China Shenhua Energy Co 1088.HK -1.0% (H1 result); Anton Oilfield Services Group 3337.HK +1.3% (Q2 result); Wintime Energy Co 600157.CN +1.0% (H1 result); Oil Search OSH.AU +3.1% (Q2 result)
- Utilities: Shanghai Electric Power 600021.CN -1.9% (H1 guidance)
- Telecom: China Telecom 728.HK +5.9% (June operational data); China Unicom 762.HK +7.5% (June operational data)

>>> US After Hours Summary: SANM +11.4%, CNI +3.1%, BSX +2.3%, IBM -5.

After Hours Summary: SANM +11.4%, CNI +3.1%, BSX +2.3%, IBM -5.0%, HXL -2.7%, WERN -1.1% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: SANM +11.4%, CNI +3.1%, BSX +2.3%, HLX +1.8%, MDCA +1.1%, CCK +0.9%, STLD +0.6%, WWD +0.6%

Companies trading higher in after hours in reaction to news: FNF +4.5% (increased quarterly dividend to $0.21 from $0.19/share; approved new FNF Group three-year stock repurchase program), CNX +2.0% (Southeastern Asset Management discloses 21.1% active stake in 13D filing), MDCA +1.1% (announced that Miles S. Nadal has retired as CEO and Chairman of the Board; Scott L. Kauffman named Chairman and CEO; Michael Sabatino, formerly Chief Accounting Officer, has resigned; co also reaffirmed FY15 guidance), PVA +0.8% (co's CEO and President Baird Whitehead announced his retirement; Board has retained recruiting firm to find replacement)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: IBM -5.0%, HXL -2.7%, WERN -1.1%, RMBS -0.7%, FIBK -0.1%

Companies trading lower in after hours in reaction to news: CYTR -15.3% (announced public offering of its common stock; size not disclosed), RNO -5.6% (announced suspension of Q2 distribution), EXAS -5.1% (to sell 7 mln shares of common stock in an underwritten public offering), UNFI -4.9% (announced that its contract as a distributor to Albertsons will terminate on September 20, 2015, rather than upon the original contract end date of July 31, 2016), SHAK -4.2% (filed for 4 mln share common stock offering by selling shareholders), ADPT -1.5% (filed for offering of common stock, size not disclosed)