>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: ANFI +11.1%, ARCP +6.9%, PTLA +4.5%, SSYS +3.9%, AMBC +2.5%, EVEP +1.6%, ECYT +1.6%, MHR +1.5%, ENDP +1.3%, NCT +1.2%, TCAP +0.5%

M&A news: MVNR +23.1% (to be acquired by Mitel (MITL) in a cash and stock deal valued at ~$560 mln, or $17.94 per share), FSL +7.7% (Freescale Semi and NXPI to merge), BSX +1.2% (entered into a definitive agreement with Endo International (ENDP) to acquire the American Medical Systems urology portfolio for $1.6 bln in up-front cash and a potential additional $50 million milestone based on 2016 sales), .

Select EU financial related names showing strength: RBS +2%, LYG +1.2%, BCS +0.9%

Other news: ATHX +19.7% (Athersys and Chugai enter license agreement and collaboration to develop MultiStem Cell Therapy for ischemic stroke in japan), ONCY +19.2% (announces receipt of Orphan Drug Designation from the U.S. FDA for Cancer of the Fallopian Tube), OHRP +13.8% (announces additional positive anatomic data from the OHR-102 IMPACT study interim analysis),NXPI +11.7% (Freescale Semi and NXPI to merge), ACST +10.9% (announces full data for phase II TRIFECTA Trial ), TCPI +7.7% (issues statement on recent litigation; co has voluntarily chosen to conduct additional levels of quality control on its products), SCOK +3.8% (to produce hydrogen at Syngas Facilities for sale to Shenma Industry Co), STM +2.7% (announced that ST was providing micro-mirrors and control devices for Perceptual Computing initiatives at Intel (INTC)), ALKS +1.8% (announces new drug candidate, ALKS 7119, for treatment of Alzheimer's Agitation, Depression and other CNS Diseases), FEYE +1.4% (announced a new product integration with Samsung to enhance enterprise risk management on Samsung KNOX-enabled devices. ), TCON+1.4% (announces positive Phase 1b results for TRC105 in combination with Inlyta), DVAX +1.4% (announces that the independent Data and Safety Monitoring Board has completed its second prespecified review and has recommended that the study continue unchanged), AMGN +1.3% (Amgen's Phase 3 Head-to-Head ENDEAVOR Study demonstrates superiority of Kyprolis over Velcade in patients with relapsed multiple myeloma), BTU +1.3% (announces offering of $1.0 billion in senior secured second lien notes, in a private placement )

Analyst comments: URI +1.5% (upgraded to Overweight from Equal-Weight at Morgan Stanley ), ZIOP +1.5% ( target raised to $14 from $11 at Mizuho), JKHY +1.2% (upgraded to Outperform at Oppenheimer), ALK +0.9% (upgraded to Buy at Stifel), TWTR +0.6% (initiated with a Buy at Axiom Capital)

>>> Aruba - To be acquired by Hewlett-Packard for $24.67/shr in cash; total deal

To be acquired by Hewlett-Packard for $24.67/shr in cash; total deal valued around $3.0 billion 

HP (NYSE: HPQ) and Aruba Networks (NASDAQ: ARUN) today announced a definitive agreement for HP to acquire Aruba, a leading provider of next-generation network access solutions for the mobile enterprise, for $24.67 per share in cash. The equity value of the transaction is approximately $3.0 billion, and net of cash and debt approximately $2.7 billion. Both companies' boards of directors have approved the deal.

Aruba is a Sunnyvale-based industry leader in wireless networking with approximately 1,800 employees. The company had revenues of $729 million in fiscal 2014, and has reported compound annual revenue growth of 30 percent over the last five years.

Aruba boasts a highly regarded innovation engine and specialized sales, marketing and channel model, complementing HP's leading networking business and go-to-market breadth. Together, HP and Aruba will deliver next-generation converged campus solutions, leveraging the strong Aruba brand. This new combined organization will be led by Aruba's Chief Executive Officer Dominic Orr, and Chief Strategy and Technology Officer, Keerti Melkote, reporting to Antonio Neri, leader of HP Enterprise Group. With this move, HP will be uniquely positioned to deliver both the innovation and global delivery and services offerings to meet customer needs worldwide.

With the shift to mobile, enterprise networking needs are exceeding the capabilities of legacy infrastructure. At the same time, organizations are shifting rapidly to mobility-centric workplaces for their employees, guests, customers and students. The next-generation 802.11ac Wi-Fi standard is critical in enabling this trend. This new technology will support the faster speeds and access to cloud applications that end-users expect. Enterprises need comprehensive, integrated and secure networking solutions to help them transition legacy systems to the wireless edge. Today's announcement directly addresses these market trends.

"Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of IT," said Meg Whitman, Chairman, President and Chief Executive Officer of HP. "By combining Aruba's world-class wireless mobility solutions with HP's leading switching portfolio, HP will offer the simplest, most secure networking solutions to help enterprises easily deploy next-generation mobile networks."

"Together with HP, we have a tremendous opportunity to become an even greater force in enterprise mobility and networking," said Mr. Orr. "This transaction brings together Aruba's best-of-breed mobility hardware and software solutions with HP's leading switching portfolio. In addition, Aruba's channel partners will have the opportunity to expand their businesses with HP offerings. Together, we will build on Aruba's proven 'customer first, customer last' culture, creating an innovative, agile networking leader ideally positioned to solve our customers' most pressing mobility, security and networking challenges."

HP and Aruba believe that by combining complementary product portfolios and go-to-market approaches they will be able to accelerate revenue growth and strengthen the financial performance of the combined HP Networking business, and create a leading competitor in the $18 billion and growing campus networking sector. Overall, HP expects the acquisition to be accretive to earnings in the first full year following close.The transaction is expected to close in the second half of HP's fiscal year 2015, subject to Aruba stockholder approval, regulatory approvals in the US and other countries as well as other customary closing conditions.

>>> US Early premarket gappers

Early premarket gappers
Gapping up: ATHX +21.6%, NXPI +12.2%, FSL +7.2%, CEMP +5.6%, ZIOP +4.6%, NSPH +4%, SSYS +3.9%, STM +2.8%, RBS +1.9%, ASML +1.6%, FEYE +1.6%, BCS +1.5%, ARMH +1.5%, LYG +1.4%, BUD +1.1%, TXN +1%, NOK +1%, DB +0.9%, AU +0.7%

Gapping down: LL -23.2%, WBAI -13.4%, NBG -8.3%, GDP -6.3%, GENE -5.7%, JKS -4.1%, SSL -2.8%, TNP -2.7%, SDRL -2.3%, GPRO -2.3%, PTCT -1.9%, CRM -1.2%, RIG -1.2%, RDS.A -1.1%, ESV -1.1%, BHP -1%, RIO -1%, WUBA -0.9%

>>> EuroBank : Says about €20B left the banking system (timeframe uncertain), bu

Says about €20B left the banking system (timeframe uncertain), but deposits stabilized after euro group - US financial press 
- Greek banks saw deposit inflows last week 
- Notes some concerns among Greek citizens about capital controls and deposit tax. 
- ECB requested no increase in T-bill exposure; At the current time, banks in Greece cannot buy more T-bills
- Banks in Greece are borrowing about €100B from the eurosystem.

(GS) Europe Tech.: M&A to remain a key theme in EU Tech – Refining our framework

* M&A to remain front and centre for EU Tech
M&A has been, and we expect it to remain, a key strategic focus across the
technology sector globally. With companies continuing to generate good
growth, strong underlying cash flow and sitting on large cash balances, we
expect all vendors to continue to pursue M&A as their primary use of cash.
Further, we expect companies to use M&A to drive improvements in
industry positioning – either through expanding addressable markets,
accelerating route-to-market by acquiring technology rather than building,
adding adjacent high-growth segments, acquiring scale, offsetting
disruptive threats, or driving cost synergies.

* Strategic buyers dominate financial buyers
Based on our analysis of historical M&A transactions in the global
technology sub-sectors in our coverage, we found that the majority of
transactions (93% median) have been driven by strategic buyers. However,
we also found that 67% of the transactions in mid-market ERP applications
space were private equity deals relative to a median of 7% of the overall
global tech transactions we analysed by sector.

* Updating our M&A framework
Our revised framework first eliminates companies with blocking
shareholders, and then assesses potential candidates based on qualitative
and quantitative factors such as: (1) unique/disruptive technology offerings;
(2) significant customer base/market positions; (3) opportunity for cost
synergies; and (4) market cap. Based on these scores, we assign M&A
weightings in our valuations to potential targets in our EU Technology
coverage. Stocks screening with the highest scores include Mobileye,
Technicolor, Pace, Aveva, Opera, Sage, Temenos and Wirecard. These
updated weightings and modest changes to strategic valuations from our
revised framework drive changes to our price targets.

* Key stock recommendations
In the backdrop of our updated M&A framework, we reiterate our CL Buy
on Wirecard and Alcatel. We believe that Wirecard offers strategic appeal,
with a best-in-class technology platform and differentiation in fraud and
risk management as well as a rapidly expanding presence in Asia, while
ALU can benefit from value-creating M&A through a disposal of Wireless.

(BofA-ML) 10 reasons to stay long the S&P

1- Sentiment is far from euphoric
Wall St. sentiment is at bearish extremes, with strategists recommending just a 52%
stock allocation. When strategists have been as or more bearish in the past, the S&P
500 has gone up over the next 12 months 98% of the time, with avg. returns of 27%.

2- Fund managers are close to 5% cash
BofAML’s latest Global Fund Manager Survey suggests cash balances remain high
at 4.7%, still in “buy” territory and represent money waiting to be put to use.

3- The Great Rotation hasn’t happened yet
Since 2009, equities have seen less than $500bn in inflows, compared to over
$900bn for bonds. The Great Rotation out of bonds into stocks has more to go.

4- S&P is 60% less levered than at prior market peaks
The S&P 500 has cut its leverage ratio to just above a third of its ‘00 and ‘07 levels.

5- US corporates are awash in cash
Unlike the US government or consumer, US corporates have delevered and are
flush with cash.

6- Best income growth story around
Nearly half of the S&P 500 pays a dividend yield above the 10-year Treasury yield,
close to its 3-decade high, and the S&P 500 payout ratio sits near century lows.

7- Valuations aren’t stretched
The S&P is trading above average on P/E, which concerns investors. But on Price
to Free Cash Flow, Price to Normalized Earnings—a more predictive valuation
metric—and EV/EBITDA, the S&P 500 still looks attractive.

8- US is the biggest innovator…and innovation adds alpha
US R&D to GDP has been rising over time, and the US spends more on R&D than
any other country including China. And R&D spenders typically outperform.

9- Best-in-breed equity index
US stocks trade at about a 10% premium to global equities, but in our view that premium
is warranted: the US has a higher ROE, lower beta, and has a significantly higher
proportion of “B+ or Better” ranked stocks (stable earners) than global benchmarks.

10- Lower oil and Global QE bode well for future earnings
If lower oil prices and further easing from global central banks can stimulate global
growth and reduce the risk of a global slowdown, we believe this is likely to more than
offset much of the short-term hit to Energy profits.

Time is the best arbitrage opportunity for stocks
While there may be risks to near term performance of the S&P 500, for stocks,
extending one’s holding period has proven profitable. The probability of negative
returns significantly decreases as time horizons increase. For other asset classes,
this is not the case.