RTRS - MICROSOFT CORP MSFT.O SAYS CHARGE RELATED TO ASSETS ASSOCIATED WITH THE ACQUISITION OF THE NOKIA DEVICES AND SERVICES (NDS) BUSINESS
Gapping up
In reaction to strong earnings/guidance: ASTI +34%, TCS +5.7%, CCF +1.9%, HVT +1.1%, (Q2 sales)
Other news: PIP +5% (PharmAthene and Immunovaccine enter into an exclusive global license agreement), MHR +3.7% (received and accepted a firm commitment from Bank of Montreal, which is the administrative agent and lead lender under MHR's senior secured revolving credit facility), VNDA +3.5% (receives European Commission approval for HETLIOZ (tasimelteon) for the treatment of Non-24-Hour Sleep-Wake Disorder in totally blind adults ), SYMC +3.1% (close to deal for Veritas unit sale to Carlyle (CG) for $7-8 bln, according to Bloomberg), TREE +3% (to replace MIG in the S&P SmallCap 600), TI +2.8% (still checking), IRWD +2.5% (Ironwood Pharma and AstraZeneca announce that top-line data demonstrate linaclotide met all primary and secondary endpoints), BTU +2.2% (Wyoming Department of Environmental Quality reaffirmed self-bonding eligibility for three mine permits), GLDD +1.9% (announced the receipt of a $76 mln award for the Shell Island West Natural Resource Damage Assessment Restoration Project; also recently awarded a $20 mln contract), ARWR +1.9% (receives regulatory permission in the UK and New Zealand to proceed with Part B of its Phase 1 study of ARC-AAT), BBW +1% ( adopts a new repurchase program which authorizes the Company to repurchase up to an additional $10 million of its common stock until March 31, 2016)
Analyst comments: WWE +2.8% (initiated with a Outperform at Wells Fargo ), SNAK +2.5% (upgraded to Outperform from Neutral at Wedbush), DKS +1.1% (upgraded to Outperform at Imperial Capital), AGO +0.9% (upgraded to Buy from Neutral at BTIG Research
)
In reaction to strong earnings/guidance: ASTI +34%, TCS +5.7%, CCF +1.9%, HVT +1.1%, (Q2 sales)
Other news: PIP +5% (PharmAthene and Immunovaccine enter into an exclusive global license agreement), MHR +3.7% (received and accepted a firm commitment from Bank of Montreal, which is the administrative agent and lead lender under MHR's senior secured revolving credit facility), VNDA +3.5% (receives European Commission approval for HETLIOZ (tasimelteon) for the treatment of Non-24-Hour Sleep-Wake Disorder in totally blind adults ), SYMC +3.1% (close to deal for Veritas unit sale to Carlyle (CG) for $7-8 bln, according to Bloomberg), TREE +3% (to replace MIG in the S&P SmallCap 600), TI +2.8% (still checking), IRWD +2.5% (Ironwood Pharma and AstraZeneca announce that top-line data demonstrate linaclotide met all primary and secondary endpoints), BTU +2.2% (Wyoming Department of Environmental Quality reaffirmed self-bonding eligibility for three mine permits), GLDD +1.9% (announced the receipt of a $76 mln award for the Shell Island West Natural Resource Damage Assessment Restoration Project; also recently awarded a $20 mln contract), ARWR +1.9% (receives regulatory permission in the UK and New Zealand to proceed with Part B of its Phase 1 study of ARC-AAT), BBW +1% ( adopts a new repurchase program which authorizes the Company to repurchase up to an additional $10 million of its common stock until March 31, 2016)
Analyst comments: WWE +2.8% (initiated with a Outperform at Wells Fargo ), SNAK +2.5% (upgraded to Outperform from Neutral at Wedbush), DKS +1.1% (upgraded to Outperform at Imperial Capital), AGO +0.9% (upgraded to Buy from Neutral at BTIG Research
)
Gapping down
In reaction to disappointing earnings/guidance: KTWO -5.7%, WLB -4.9%
Select China related names showing weakness with Shanghai down ~6% overnight: ACH -9.6%, BITA -8.2%, DANG -6.9%, CHU -6.7%, CMCM -6.6%, JKS -6.3%, BZUN -6.1%, LFC -5.9%, QIHU -5.3%, JD -4.8%, NOAH -4.8%, CHL -4.6%, TEDU -4.5%, CTRP -4.3%, SINA -4%, WB -3.8%, NQ -3.2%, SOHU -3.1%, PTR -2.5%, BIDU -2%, BABA -1.9%
Select metals/mining stocks trading lower: RIO -4.1%, CLF -3.7%, BHP -2.2%
Select oil/gas related names showing early weakness: SDRL -3.3%, PBR -2.3%, STO -1.7%, TOT -1.6%, BP -1.3%, RDS.A -0.9%
Other news:PBMD -17.3% (announced share purchase plan to raise up to A$5 mln), KTWO -5.7% ( announces a proposed offering of 750,000 shares offered by the Company and 3,750,000 shares offered by the selling stockholders), ABIO -4.6% (filed for ~58.83 mln share common stock offering by selling shareholders; ~16.81 mln of the shares issuable upon exercise of warrants), JRJC -4.4% (still checking), ATRA -3.1% (to commence an underwritten public offering of shares of its common stock and expects to raise gross proceeds of ~$125.0 million ), AAOI -2.9% (disclosed entry into a sale lease-back transaction through its Taiwan branch and Chailease Finance), TGT -2.9% (still checking), GREK -2.4% (Germany's Merkel ruled out a debt haircut), CLVS -2.1% (commences underwritten public offering of shares of its common stock to raise aggregate proceeds of approximately $275 million), ASML -2.1% (still checking), ARMH -1.9% (still checking), PODD -1.6% (announced that it has assumed full rights to distribute its OmniPod System in the Canadian market via its newly created subsidiary, Insulet Canada, effective immediately), YHOO -1.6% (may be in symp with BABA), MO -1% (World Health Organization proposed more taxes on tobacco products)
Analyst comments: NYCB -2.6% (downgraded to Underperform from Mkt Perform at Keefe Bruyette ), ENPH -2.6% (downgraded to Neutral from Overweight at JP Morgan ), SCHN -2.4% (downgraded to Sector Weight from Overweight at Keybanc), TSLA -1.9% (downgraded to Sector Weight from Overweight at Pacific Crest), WIBC -1.9% (downgraded to Neutral from Outperform at Macquarie)
CHINA SECURITIES REGULATOR SAYS SHAREHOLDERS WITH OVER 5 PCT OF SHARES CANNOT REDUCE STAKES IN NEXT 6 MTHS
China Markets Fall Sharply Despite Fresh Help From Beijing
Fears about faltering Chinese demand rattles commodities markets
Chinese markets fell sharply Wednesday, even as Beijing scrambled to arrest a three-week stock selloff.
China has introduced fresh measures to restore investor confidence seemingly to little avail. Stocks and Chinese bonds traded offshore, even high-quality corporate bonds issued by top state-owned companies, are getting dumped. China’s yuan, freely traded in the offshore market, hit a four-month low against the U.S. dollar amid a dimming outlook for the world’s second-largest economy.
A spokesman for the China Securities Regulatory Commission, Deng Ge, described the current market mood as “panic sentiment.” In a statement, he said, “Irrational selloffs have increased greatly and that has led to a liquidity tension in the stock market.”
The Shanghai Composite fell as much as 8.2% at the start of trading Wednesday. The index is now down 4% at 3576.79. The smaller Shenzhen Composite fell 3.9%. China’s main stock benchmarks have lost more than a third of their value since highs in June.
Hundreds of Chinese stocks were frozen from trading Wednesday, with 1,287 companies halted. That represents 45.6% of the constituent stocks of the Shanghai Composite and Shenzhen Composite and $2.5 trillion of market capitalization, according to data from FactSet.
‘People lost confidence toward China’s credits. Everything is down. The riskier the bonds, the heavier they’re being sold.’
—Fixed-income trader
In Hong Kong, which has until recently fared better than the Chinese mainland, the benchmark Hang Seng Index dropped 4.2%, while a gauge of Chinese companies with Hong Kong listings, known as H-shares, plunged as much as 6.7% before easing losses to 5.5%.
China has put an arsenal of measures to work in recent days to stem the selloff that has wiped out roughly $2.4 trillion in value from China’s equities. On Wednesday, the China Securities Regulatory Commission announced that the China Securities Finance Corp., a commission unit that provides financing for margin trading, will increase purchases of small-cap stocks. The move follows an earlier pledge by the company to buy blue-chip shares to stabilize the market.
China’s central bank also said it would help ensure the China Securities Finance Corp. has ample liquidity to stabilize the market. The state-backed company may tap the interbank market, issue bonds, use mortgage financing and borrow from relending facilities, the People’s Bank of China said in a statement.
In the onshore market, the Chinese yuan hit 6.2094 per dollar, compared with 6.2100 as the market closed Tuesday. The price for the yuan in the offshore market, where it can trade freely, fell to as low as 6.2290 per dollar—the weakest level since March 18—compared with 6.2212 late Tuesday. China’s central bank fixed the yuan’s official rate for Wednesday at 6.1175 a dollar, a touch weaker than 6.1166 Tuesday.
Spot yuan trading in the onshore market has been 1.6% weaker than the reference rate in Wednesday trading. When the offshore rate trades weaker than the mainland rate, that typically indicates waning demand among non-Chinese investors for the currency. China’s central bank controls the onshore rate by setting a daily reference rate for the yuan, but allows it to trade 2% above or below that level. At the same time, the dollar rose to a five-week high against other currencies Tuesday, as investors seek safer assets amid China’s rout and uncertainty about Greece.
Investors also are selling Chinese bonds that trade offshore. “People lost confidence towards China’s credits. Everything is down. The riskier the bonds, the heavier they’re being sold. Property developers are having some of the biggest casualties,” said Frank Huang, fixed income trader at SinoPac Securities in Hong Kong. Bond yields of major property firms such as Agile Property Holdings Ltd. and Shimao Property Holdings Ltd. hit their highest levels in several weeks. Bond prices move inversely to yield.
While high-quality investment-grade bonds, including top state-owned companies, have been resilient in the past few weeks, these assets are also getting pressured, traders say. Yields of bonds issued by state-owned enterprises such as grid operator State Grid Corp. and oil giant Cnooc Ltd. have risen seven to 10 basis points Wednesday morning.
Inside China, investors seeking to keep their money out of risky stocks are flocking the onshore bond market. Benchmark 10-year Chinese government bond yields fell to 3.4% Wednesday from 3.6% earlier this month.
Over the weekend, Beijing suspended initial public offerings and made it easier for investors to borrow to buy stocks. China’s brokers also vowed to buy shares until the Shanghai Composite hits the 4500 level. Despite the recent tumble, China’s main stock index is up 72% over the past year and 10% since January.
Still, concerns are brewing that Beijing’s increasingly desperate measures to calm markets are building bigger risks into the country’s financial system, particularly a commitment from the People’s Bank of China to provide unlimited liquidity support to China Securities Finance Corporation.
“The rescue plan could potentially increase the systemic risk down the road,” analysts from Société Générale wrote in a research report. “Initially most of the stock market risk was with households, but with the rescue plan, systemically important institutions are taking up more risk when the market is still under immense downward pressure. Our biggest concern is that the progress of structural reform could suffer as the result.”
Worries about China’s faltering demand amid the stock slide are also driving down commodity markets, with copper hitting a six-year low on Tuesday. China is the world’s top copper consumer, accounting for about 40% of global consumption. Pessimism about China, coupled with worries about a supply glut, also sent U.S. oil prices to a near three-month low Tuesday.
Brent, the global oil benchmark, is down 29 cents at $56.56 a barrel Wednesday, after falling as low as $55.10 earlier.
“Fears about the risks to financial stability and the wider economy have contributed to negative sentiment toward commodities,” analysts from Capital Economics wrote in a research report. “The impact has been felt most in industrial metals, such as copper, where China is by far the most important consumer.”
Meanwhile, eurozone leaders set a Sunday deadline for Greece to come up with a new set of more stringent measures to avoid defaulting on the European Central Bank and exiting the currency union. While the leaders raised the possibility of some short-term financing to help Athens make a July 20 payment, many of the policy overhauls and budget cuts demanded were overwhelmingly rejected by Greek voters in a referendum last weekend.
The Nikkei 225 Stock Average declined 1.5% in early trading while Australia’s S&P/ASX 200 fell 1.7%. South Korea’s Kospi Composite was down 1.3.
Global bond markets rallied as investors sought haven assets in developed-country debt. Yields on benchmark U.S., German, and U.K. bonds hit their lowest levels in more than a month. On Tuesday, the International Monetary Fund warned of the risks of raising rates too early in the U.S., and called for the Fed to delay a raise until 2016. Concerns that the Federal Reserve would raise rates prompted a bond selloff in June, given concerns that higher rates would lower their outstanding value.
The euro also sank 0.5% against the Japanese yen as investors sought assets perceived to be safe.
After Hours Summary: TCS +6.3%, CCF +1.9%, VMW +1.8%, KTWO -1.8% following earnings/guidance
After Hours Gainers:
Companies trading higher in after hours in reaction to earnings: TCS +6.3%, CCF +1.9%, VMW +1.8%
Companies trading higher in after hours in reaction to news: VNDA +3.5% (received European Commission approval for HETLIOZ for the treatment of Non-24-Hour Sleep-Wake Disorder in totally blind adults), NVS +3.2% (FDA approved Entresto (sacubitril/valsartan) tablets to reduce risk of cardiovascular death and heart failure hospitalization), TREE +2.8% (to replace MIG in the S&P SmallCap 600), GLDD +1.9% (announced the receipt of a $76 mln award for the Shell Island West Natural Resource Damage Assessment Restoration Project; also recently awarded a $20 mln contract), CNSI +0.5% (disclosed an amendment to its master service agreement with Tech Mahindra)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings: KTWO -1.8%
Companies trading lower in after hours in reaction to news: PBMD -7.4% (announced share purchase plan to raise up to A$5 mln), ABIO -4.6% (filed for ~58.83 mln share common stock offering by selling shareholders; ~16.81 mln of the shares issuable upon exercise of warrants), ATRA -3.1% (to commence an underwritten public offering of shares of its common stock and expects to raise gross proceeds of ~$125.0 million), AAOI -2.9% (disclosed entry into a sale lease-back transaction through its Taiwan branch and Chailease Finance), CLVS -2.1% (commenced underwritten public offering of shares of its common stock to raise aggregate proceeds of ~$275 mln), GREK -1.9% (Germany's Merkel ruled out a debt haircut), KTWO -1.8% (announced a proposed offering of 750,000 shares offered by the Company and 3,750,000 shares offered by the selling stockholders), PODD -1.6% (announced that it has assumed full rights to distribute its OmniPod System in the Canadian market via its newly created subsidiary, Insulet Canada, effective immediately)
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Portfolio Ticker Matches: WRAPX
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Closing Market Summary: Stocks Stage Intraday Turnaround, End With Gains
The stock market was on track for a sharp decline in the early going, but the opening weakness became a distant memory by the end of the trading day. The S&P 500 gained 0.6% after being down 1.2% at the start while the Nasdaq Composite (+0.1%) underperformed throughout the day.
Equity indices struggled at the start amid rising macroeconomic uncertainty overseas. Greece was in the headlines this morning, but today's Eurogroup meeting ended rather quickly with Chief Jeroen Dijsselbloem saying the Eurogroup expects Greece to submit a formal request for access to the European Stability Mechanism tomorrow. To that point, the Financial Times reported during the afternoon that Greece has indeed sent an ESM access request to the European Central Bank.
As for China, the Shanghai Composite lost 1.3% in the Tuesday session despite Monday's CNY1.80 trillion liquidity injection from the People's Bank of China and other emergency measures undertaken by the government. As a result nearly 25% of A-share listings have been halted over the past seven days as companies scramble to protect their market values.
Investors appeared to be concerned with the overseas uncertainty at the start of the session, but the heavy selling abated just as markets across Europe closed for the day. The S&P 500 then returned above its 200-day moving average (2,055) and continued its charge into positive territory. It is worth noting that afternoon action featured a report suggesting a short-term debt deal could be offered to Greece, but the report was attributed to an unnamed official, which should be met with caution.
Cyclical sectors displayed relative weakness at the start, but just about every growth-sensitive group erased its decline by the close. Top-weighted financials (+0.2%) and technology (+0.2%) spent the bulk of the session at the bottom of the leaderboard, but dip-buyers helped the two sectors erase their losses. That being said, high-beta chipmakers finished among the laggards with the PHLX Semiconductor Index shedding 0.3% after Advanced Micro Devices (AMD 2.09, -0.38) lowered its Q2 revenue guidance due to weaker than expected PC demand. For its part, AMD surrendered 15.4%.
Elsewhere among cyclical groups, the materials sector (-0.3%) spent the day behind other sectors while another commodity-related group—energy (+0.9%)—settled among the leaders. The energy sector outperformed while crude oil struggled to stay near its flat line after yesterday's 7.8% dive. WTI crude settled lower by 0.4% at $52.33/bbl, but climbed into the green in electronic trading.
Also of note, industrials (+0.8%) played a significant role in the turnaround with transport stocks leading the way. The Dow Jones Transportation Average jumped 1.1% with all but three names ending in the green. Kansas City Southern (KSU 94.40, +2.75) spiked 3.0% after being upgraded to ‘Buy' at UBS while Con-way (CNW 36.87, -0.16) was the weakest DJTA component, falling 0.4%.
Over on the countercyclical side, health care (+0.4%) and telecom services (+0.5%) ended with modest gains while consumer staples (+2.0%) and utilities (+2.5%) outperformed throughout the session.
Interestingly, the rate-sensitive utilities sector climbed into the afternoon even as selling in the Treasury market pressured the 10-yr note from its morning high. Still, the benchmark note ended in the green with its yield down three basis points at 2.26%.
Today's trading volume was heavier than usual with more than 950 million shares changing hands at the NYSE floor.
Economic data released this morning included Trade Balance and JOLTS:
* The U.S. trade deficit increased by $1.20 billion in May from April's downwardly revised $40.70 billion (from $40.90 billion) to $41.90 billion while the Briefing.com consensus expected an increase to $42.50 billion
* The goods deficit increased $1.20 billion in May from April's $60.30 billion to $61.50 billion while the services surplus was virtually unchanged at $19.60 billion
* The May Job Openings and Labor Turnover Survey showed that job openings increased to 5.376 million from a revised rate of 5.109 million (from 5.367 million)
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET, the FOMC Minutes from the June meeting will be reported at 14:00 ET, and the Consumer Credit report for May (Briefing.com consensus $18.20 billion) will cross at 15:00 ET.
* Nasdaq Composite +5.5% YTD * Russell 2000 +3.6% YTD * S&P 500 +1.1% YTD * Dow Jones Industrial Average -0.3% YTD
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Potash Corp. Said to Be Open to Raising K+S Bid: Globe & Mail 2015-07-07 18:58:02.282 GMT
By Rita Devlin Marier (Bloomberg) -- Potash Corp. could raise its bid for K+S if K+S gave Potash access to its operations and more value was revealed, the Globe and Mail reports, citing unidentified person close to Potash and familiar with the deal.
* “If we sit down and do due diligence and they can demonstrate some incremental value to us, we might have an extra euro for them. I wouldn’t rule that out”: person said * Link to story (Subscription required): Globe & Mail * NOTE: On July 3, Potash Said to View K+S 50 Euro a Share Valuation as Too High
For Related News and Information: First Word scrolling panel: FIRST<GO> First Word newswire: NH BFW<GO>
--With assistance from Aoyon Ashraf in Toronto.
To contact the reporter on this story: Rita Devlin Marier in Toronto at +1-416-203-5718 or rdevlin5@bloomberg.net To contact the editors responsible for this story: Clyde Eltzroth at +1-212-617-1879 or celtzroth1@bloomberg.net Stefanie Batcho-Lino