>>> What to look at today - 12th of January 2015

Dow-0,95% S&P-0,84% Nasdaq-0,68% Russell-0,87%
US Market closed lower on Friday, below its 50d MA (2045), news on Bbg in the mnorning reporting that ECB was unbsure about QE put pressure on the market, NFP Report helped market to rebound but it was short live, the lack of payroll growth took the shine off what would have been a decent report. Hourly wages declined 0.2% and November growth was slashed in half (to +0.2% from +0.4%), the absence of wage growth kept financials (-1.3%) and consumer discretionary shares (-1.1%) behind the broader market throughout the session. Hombuilder had OP before earning season period, cyclical sectors, industrials (-1.1%) finished among the laggards while energy (-0.8%), materials (-0.5%), and technology (-0.3%) outperformed. Volume were below average @ 713mil shares...VIX @ 17.55 +3.11%...Japan Cabinet office raised Japan FY15 real GDP forecast to 1.5% (as expected) from 1.4% previously forecasted, also forecasted CPI at 1.4%. Later in the day, Japan Finance Minister Aso officially announced approval of ¥96.3T budget for FY15, in line with press speculation earlier today. Japan forecasted FY15 tax revenues to be ¥54.5T, while forecasted Finance Ministry bond sales to drop to ¥36.9T, both in line with expectations.Over the weekend, Fitch cut Russia's sovereign rating by one notch to BBB- with negative outlook, citing sharp falls in oil prices and the ruble, with a steep rise in interest rates. Fitch noted growth may not return in Russia until 2017. Crude oil continued to fall in today's session. WTI crude dropped to as low as $47.50/bbl, while Brent oil at just above $49/bbl. In terms of the Shanghai equity market, A-shares continued to decline today by another 2.1%, to the worst level so far in the year....US Companies reporting today After the close : AA, SNX & LMNR
Nikkei +0.18% Hang Seng +0.19% Shanghai -1.89%

RUB $62.72 RUB €74.68 WTI $47.36 BRENT $49.13

Eur$ 1.1857 S&P flat EuroStoxx +0.46% Dax +0.39% SMI +0.28%

Macro :
- Russia Cut to One Step Above Junk by Fitch on Oil, Sanctions (2)
- China 2014 Vehicle Sales 23.5m Units Vs 21.98m Units Year Ago
- Greece Euro Exit Worse Than Lehman Default, Eichengreen Says
- Greek Central Bank Says Deposit Outflows Under Complete Control
- EU Plans to Introduce Foreign Fighter Category at Borders: Welt
- Spain Supports EU Introducing Border Checks, Diaz Tells El Pais
- ECB's Visco (Italy) announces support for QE; says QE is now a "standard" tool for central banks  
- Japan Raises FY15 Real GDP Growth Forecast to 1.5% From 1.4%


Keep an eye on :
- AERL LN : Aer Lingus Investor Says IAG May Have to Bid Eu3/Shr: Telegraph
- ATL IM : *ATLANTIA MAY SELL UP TO 40% OF AUTOSTRADE PER' L'ITALIA: SOLE
- ATLN VX : Actelion Confirms 2014 Guidance, to Give 2015 Outlook Later
- CRG IM : Consob Challenges Carige 2013 Earnings in Civil Court in Genoa
- DLG GY : Dialog Semiconductor 4Q Sales Rise Above Forecast
- ENEL IM : Enel Achieves Eu4b Disposal Target in 2014: Il Sole 24 Ore
- ETL FP : Eutelsat CEO Plans Record 5 Satellite Launches in 2015: Figaro
- FCC SM : FCC Board to Consider Slim Nominations This Month, Cinco Says
- HSBA LN :HSBC, RBS Expected to Cut Bonuses Because of Fines Paid: FT
- ORA FP : Orange to Raise Stake in Cloudwatt to 100%, Les Echos Says
- PG IM : GoldenTree, Marc Lasry Buy Just Under 50% of Seat PG: Sole
- PMO LN : Premier Oil Says It Can Break Even on $35-a-Barrel Oil: Times
- QIA GY : Qiagen Full Yr EPS Guidance Cut to ~$1/Shr on $47m Charges
- ROG VX : Roche Takes Majority Stake in Foundation Medicine for $1 Billion
- RYA LN : Ryanair to Make Push for Business Customers: WirtschaftsWoche
- SAMAS FH : Sampo Not Buying Topdanmark Shares Now, CEO Tells Berlingske
- SAN SM : Soros Funds Invest in Santander Capital Increase, Mundo Says
- SEV FP : Suez Environnement CEO Vows to Stay in U.K. on EU No Vote: FT
- SGO FP : St Gobain Aims to Double Asia Share of Sales to 10% 2020: Echos
- SHP LN : Shire to Buy NPS Pharmaceuticals for $46-Shr in Cash, Deal Doesn’t Put Restrictions on More M&A: CEO
- STAN LN : Standard Chartered Liquidates Swiss-Private Bank Unit: FuW Link
- SBD LN : Songbird to Reject Qatar Investment Authority Offer: Telegraph
- TFI FP : TF1 Is Nearing Sale of Eurosport Channel, Les Echos Says
- TSCO LN : Tesco Said to Suspend Ninth Executive Over Accounting: Telegraph
- TSCO LN : Auchan may be interested in acquiring Tesco's Polish assets 
- UHRN VX : Swatch Sees Positive Effect From Dollar Rate: Schweiz am Sonntag
- VOLVB SS : Volvo Cars to Export China-Built Vehicles to U.S. This Year

>>> Brokers Upgrades & Downgrades - 12th of January 2015

>>> Up
*AFRICA OIL ADDED TO GOLDMAN CONVICTION BUY LIST
*ARKEMA RAISED TO BUY VS NEUTRAL AT CITI
*BASF RAISED TO BUY VS NEUTRAL AT CITI
*BIM RAISED TO OVERWEIGHT VS UNDERWEIGHT AT MORGAN STANLEY
*COCA-COLA ICECEK RAISED TO EQUALWEIGHT AT MORGAN STANLEY
*DNO RAISED TO NEUTRAL VS SELL AT GOLDMAN
*EUROCASH RAISED TO EQUALWEIGHT VS UNDERWEIGHT AT MORGAN STANLEY
*GENEL ENERGY RAISED TO BUY VS NEUTRAL AT GOLDMAN
*GEORG FISCHER RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*LANXESS RAISED TO BUY VS NEUTRAL AT CITI
*LUNDIN PETROLEUM RAISED TO NEUTRAL VS SELL AT GOLDMAN
*PFEIFFER VACUUM RAISED TO OVERWEIGHT VS UNDERWEIGHT AT HSBC
*RECKITT BENCKISER RAISED TO NEUTRAL VS SELL AT UBS
*SOLVAY RAISED TO NEUTRAL VS SELL AT CITI

>>> Down
*ALPHA BANK CUT TO NEUTRAL VS BUY AT UBS
*DELTA LLOYD CUT TO UNDERWEIGHT VS NEUTRAL AT JPMORGAN
*DET NORSKE CUT TO SELL VS NEUTRAL AT GOLDMAN
*DUNELM CUT TO UNDERPERFORM VS SECTOR PERFORM AT RBC
*HAVAS CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*ITV CUT TO SELL VS HOLD AT BERENBERG
*MOL CUT TO NEUTRAL VS BUY AT GOLDMAN
*PPC LTD CUT TO SELL VS NEUTRAL AT UBS
*PROSIEBENSAT.1 CUT TO SELL VS HOLD AT BERENBERG
*STATOIL RAISED TO NEUTRAL VS SELL AT GOLDMAN
*SURGUT PREFS CUT TO NEUTRAL VS BUY AT GOLDMAN
*TURKISH AIRLINES CUT TO NEUTRAL VS BUY AT GOLDMAN
*VICTREX CUT TO NEUTRAL VS BUY AT CITI
*VONTOBEL CUT TO NEUTRAL VS OUTPERFORM AT CREDIT SUISSE

>>> PT Changes


>>> Initiation
*AKASTOR RATED UNDERWEIGHT VS SUSPENDED AT BARCLAYS
*AKER SOLUTIONS RATED NEW UNDERWEIGHT AT BARCLAYS, PT NOK50
*AVIVASA RATED NEW OVERWEIGHT AT HSBC
*BASHNEFT REINSTATED NEUTRAL AT GOLDMAN
*TLG IMMOBILIEN RATED NEW OVERWEIGHT AT HSBC, PT EU15.90

>>> Call
>> Stock
*AFRICA OIL ADDED TO GOLDMAN CONVICTION BUY LIST
*DRAGON OIL ADDED TO GOLDMAN CONVICTION BUY LIST
*PEGASUS REMOVED FROM GOLDMAN CEEMEA FOCUS LIST, STAYS BUY

WSJ : Roche Holding to Pay $1.03 Billion for Diagnostics-Firm Stake

Roche Holding to Pay $1.03 Billion for Diagnostics-Firm Stake
Proposed Pact Points to Growing Role of Genetic Diagnostics in Cancer Treatment

Roche Holding AG agreed to pay $1.03 billion for up to a 56.3% stake in Foundation Medicine Inc. in a collaboration that underscores the growing importance of genetic diagnostics in the treatment and development of drugs for cancer.

Under the agreement, Roche will launch a tender offer for about 15.6 million shares of the Cambridge, Mass., maker of molecular diagnostic tests for about $780 million, or $50 a share, and it will also acquire five million new shares of the company, also for $50 each. The amount is a 109% premium over Foundation’s closing price of $23.93 on Friday.

Foundation has developed and markets two tests—one for solid tumors such as lung cancer and melanoma and one for blood cancers such as leukemia—that use next-generation genetic sequencing to identify mutations that are the drivers of a patient’s disease. Doctors can use the results to try to match patients with available drugs that target the identified mutations or with clinical trials testing such drugs.

This “personalized medicine” approach is helping to transform cancer treatment and prompting an intense search among drug and biotechnology companies for new driver mutations and drugs that take aim at them.

Under the agreement, in addition to the equity, Roche may invest at least an additional $150 million for research and development collaboration between the two companies. The R&D will include using the tests in the development of drugs in Roche’s pipeline, said Michael Pellini, Foundation’s president and chief executive officer.

Other R&D efforts will focus on developing new cancer blood tests known as liquid biopsies and tests that could be used in conjunction with drugs that enable the body’s immune system to fight cancer, he said.

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Roche is making “a meaningful commitment to Foundation Medicine as well as to the molecular information space,” said Dr. Pellini, who would remain as president and chief executive officer under the agreement. “The overriding reason for this relationship is that we believe we can have a greater impact on patient care in oncology.”

Foundation’s Foundation One test for solid tumors lists for $5,800 while its Foundation Heme test for blood cancers is priced at $7,200. The tests aren’t widely covered by insurance, though the company says it often succeeds in negotiating reimbursement on an individual basis. Foundation says it has sold about 35,000 tests since the first one was launched in June 2012.

As part of the agreement, Roche will market the tests outside the U.S. and support Foundation’s commercial efforts in the U.S., Dr. Pellini said.

Roche will get three seats on the board, which will be expanded to nine members, while Foundation will remain as an independent publicly traded company. Foundation has agreements with more than two dozen pharmaceutical and biotech companies involving the use of its tests in drug development, Dr. Pellini said. They won’t be affected by the deal, which is subject to regulatory approval.

In a statement, Daniel O’Day, chief operating officer of Roche’s Roche Pharma unit, said combining Foundation’s genomic and molecular information with Roche’s expertise in oncology will enable the companies to “bring personalized health care in oncology to the next level.”

>>> Asian Update

Asian Mid-session Update: Japan approves FY15 budget; Shanghai equities traded lower


***Economic Data***
- (AU) AUSTRALIA DEC ANZ JOB ADS M/M: 1.8% V 0.7% PRIOR; 7th consecutive increase
- (AU) AUSTRALIA NOV HOME LOANS M/M: -0.7% V +1.7%E
- (AU) AUSTRALIA NOV CREDIT CARD BALANCES: A$50.5B v A$49.6B PRIOR; CREDIT CARD PURCHASES: A$22.7B v A$24.4B PRIOR

***Index Snapshot (as of 03:30 GMT)***
- Nikkei225 closed, S&P/ASX -0.8%, Kospi -0.3%, Shanghai Composite -2.1%, Hang Seng +0.1%, Mar S&P500 -0.1% at 2,033

***Commodities/Fixed Income***
- Feb gold +0.8% at $1,226, Feb crude oil -1.4% at $47.68/brl, Mar Copper flat at $2.75/lb
- USD/CNY: (CN) PBoC sets yuan mid point at 6.1233 v 6.1296 prior setting
- USO: Soc Gen cuts 2015 WTI Crude forecast to $51/bbl from $65/bbl previous forecast
- USO: Goldman Sachs cuts 2015 WTI Crude oil to $47.15/bbl from $73.75/bbl previous forecast
- USD/CNY: (CN) PBoC official Wang: PBoC to intervene if fx moves out of range - Caixin
- USD/CNY: Standard Chartered revises forecast to 6.12 by end of 2015

***Market Focal Points/Key Themes/FX***
- Japan Cabinet office raised Japan FY15 real GDP forecast to 1.5% (as expected) from 1.4% previously forecasted, also forecasted CPI at 1.4%. Later in the day, Japan Finance Minister Aso officially announced approval of ¥96.3T budget for FY15, in line with press speculation earlier today. Japan forecasted FY15 tax revenues to be ¥54.5T, while forecasted Finance Ministry bond sales to drop to ¥36.9T, both in line with expectations. Dollar/Yen traded little changed today around ¥118.30 level, while Japan equity markets were closed for holiday.
- Over the weekend, Fitch cut Russia's sovereign rating by one notch to BBB- with negative outlook, citing sharp falls in oil prices and the ruble, with a steep rise in interest rates. Fitch noted growth may not return in Russia until 2017. Crude oil continued to fall in today's session. WTI crude dropped to as low as $47.50/bbl, while Brent oil at just above $49/bbl. In terms of the Shanghai equity market, A-shares continued to decline today by another 2.1%, to the worst level so far in the year.
- Australia posted November home loans data at -0.7% m/m, missing consensus of +1.7%. December ANZ job advertisements came in at +1.8% m/m, higher than prior reading of +0.7%, marked 7th consecutive increase. Aussie/Dollar traded higher later in the session to about $0.8250 level.

***Equities***
US markets:
- NPSP: Shire to Acquire NPS Pharma for $46/shr in cash, deal valued at $5.2B
- LORL: Sources say talks to sell itself to Ontario Teachers pension fund have broken off - NY Post
- SEM: Guides initial FY15 $0.84-0.90 v $0.97e, R$3.1-3.2B v $3.17Be
- HCA: Raises FY14 EBITDA to $7.4B, above prior guidance range of $7.25-7.35B
- BURL: Guides Q4 higher to $1.30-1.32 v $1.28e, Rev +9.6-10.1% ($1.25-1.28, Rev +7.2-8.2% prior), SSS +5-5.5%; Announces retirement of CFO, effective Jan 12
- BABA: Reportedly to pay over $550M for a stake in an Indian online shopping company - press

Notable movers by sector:
- Financials: Cheung Kong Group 1.HK +14.6%, Hutchison Whampa 13.HK +12.4% (restructuring plan); Everbright Securities 601788.CN +3.6% (Dec Op results); GF Securities 000776.CN +1.2% (prelim 2014 results); China Merchants Property Dev 000024.CN -4.2% (lower despite strong Dec results); China Merchants Land 978.HK -5.4% (profit warning)
- Materials: Shanghai ANOKY Textile Chem 300067.CN +3.1% (FY14 guidance)
- Energy: Guodian Technology & Environment Group 1296.HK -16.9% (profit warning); Sundance Energy SEA.AU -3.0%, Drillsearch Energy DLS.AU -1.4% (WTI crude lower)

>>> What to look at this week - 10th & 11th of January


Macro :
- Greece Euro Exit Worse Than Lehman Default, Eichengreen Says
- Greek Central Bank Says Deposit Outflows Under Complete Control
- EU Plans to Introduce Foreign Fighter Category at Borders: Welt
- Spain Supports EU Introducing Border Checks, Diaz Tells El Pais
- ECB's Visco (Italy) announces support for QE; says QE is now a "standard" tool for central banks


Keep an eye on :
- AERL LN : Aer Lingus Investor Says IAG May Have to Bid Eu3/Shr: Telegraph
- ATL IM : Atlantia looks to sell 30%-40% stake in Autostrade per l'Italia
- CRG IM : Consob Challenges Carige 2013 Earnings in Civil Court in Genoa
- ENEL IM : Enel Achieves Eu4b Disposal Target in 2014: Il Sole 24 Ore
- ETL FP : Eutelsat CEO Plans Record 5 Satellite Launches in 2015: Figaro
- HSBA LN :HSBC, RBS Expected to Cut Bonuses Because of Fines Paid: FT
- PG IM : GoldenTree, Marc Lasry Buy Just Under 50% of Seat PG: Sole
- PMO LN : Premier Oil Says It Can Break Even on $35-a-Barrel Oil: Times
- QIA GY : Qiagen Full Yr EPS Guidance Cut to ~$1/Shr on $47m Charges
- RYA LN : Ryanair to Make Push for Business Customers: WirtschaftsWoche
- SEV FP : Suez Environnement CEO Vows to Stay in U.K. on EU No Vote: FT
- SHP LN : Shire to Buy NPS Pharmaceuticals for $46-Shr in Cash, Deal Doesn’t Put Restrictions on More M&A: CEO
- STAN LN : Standard Chartered Liquidates Swiss-Private Bank Unit: FuW Link
- SBD LN : Songbird to Reject Qatar Investment Authority Offer: Telegraph
- TSCO LN : Tesco Said to Suspend Ninth Executive Over Accounting: Telegraph
- TSCO LN : Auchan may be interested in acquiring Tesco's Polish assets 
- UHRN VX : Swatch Sees Positive Effect From Dollar Rate: Schweiz am Sonntag
- VOLVB SS : Volvo Cars to Export China-Built Vehicles to U.S. This Year

WSJ : Banks Ready Contingency Plans in Case of Greek Eurozone Exit

Banks Ready Contingency Plans in Case of Greek Eurozone Exit
Citigroup, Goldman Sachs, ICAP Among Firms Running Stress Tests

Banks and other financial institutions in Europe are stress-testing their internal systems and dusting off two-year-old contingency plans for the possibility Greece could leave the region’s monetary union after a key election later this month.

Among the firms running through drills are Citigroup Inc., Goldman Sachs Group Inc. and brokerage ICAP PLC, according to people familiar with the matter.

The firms’ plans include detailed checks on counterparties that could be significantly affected by a Greek exit, looking at credit exposures and testing how they would provide cross-border funding to local operations.

Some firms are also preparing for the impact on payment systems and conducting trial runs of currency-trading platforms to see how they would cope with adding a new Greek currency or dealing with potential capital controls.

The moves come as Greek leftist opposition party Syriza continues to lead in recent public opinion polls ahead of national elections on Jan. 25. The ruling coalition government has framed the election as a de facto poll on whether the country stays in the eurozone, saying Syriza’s antiausterity policies would force a break with eurozone partners. Syriza, though, hasn’t campaigned on an exit and most Greek voters want to stay in the monetary union, according to recent polls.

Most analysts still say the chances of a Greek exit are quite low. Economists at Commerzbank rate the chances on an exit at below 25%.

“Hope for the best, plan for the worst,” said Frederic Ponzo, managing partner at consultancy Grey Spark. Financial firms often test their systems for events such as a rapid change in oil prices or the recent referendum on Scottish independence, he added.

At some European banks, that currently means dusting off plans drawn up a couple of years ago, when a eurozone breakup was a hot topic. In 2011 and 2012, banks, brokers and companies with significant exposure to Greek assets put in place contingency plans to minimize the fallout from a breakup.

In late 2011, former ICAP Chief Executive David Rutter said the firm had stress-tested its currency trading platform EBS for all 17 currencies that would have resurfaced in the case of a complete breakup of the eurozone. The brokerage conducted similar tests earlier this month, two people familiar with the matter said.

Other European banks are running similar tests on trading platforms to ensure they would be capable of dealing with a rash of new currencies, according to several people familiar with the matter.

The head of currencies trading at a large European bank said that reintroducing the Greek drachma to its trading system wouldn’t be too difficult, but dealing with a larger breakup would be more challenging.

“Italy could follow Greece’s steps if the exit will prove successful in providing some relief to the country’s economic crisis,” he said.

>>> ECB's Visco (Italy) announces support for QE; says QE is now a "standard" to

ECB's Visco (Italy) announces support for QE; says QE is now a "standard" tool for central banks - press interview 
- "Sovereign bank purchases are the most effective instrument in the present situation"
- "This is a standard tool for monetary policy. We only call it unconventional because it has not been used in Europe so far"- We need to delivery more policy action, otherwise bond yields will rise again.
- "If individual central banks buy sovereign bonds at their own risk, financing conditions in Europe will diverge even further." The ECB and euro zone national central banks should carry the risk of QE together, national central banks should not be forced to carry the risk alone. 
- Corporate bond buying would not be sufficient as that market is relatively small, and large firms already have good access to financing.

>>> ECB's Visco (Italy) announces support for QE; says QE is now a "standard" to

ECB's Visco (Italy) announces support for QE; says QE is now a "standard" tool for central banks - press interview 
- "Sovereign bank purchases are the most effective instrument in the present situation"
- "This is a standard tool for monetary policy. We only call it unconventional because it has not been used in Europe so far"- We need to delivery more policy action, otherwise bond yields will rise again.
- "If individual central banks buy sovereign bonds at their own risk, financing conditions in Europe will diverge even further." The ECB and euro zone national central banks should carry the risk of QE together, national central banks should not be forced to carry the risk alone. 
- Corporate bond buying would not be sufficient as that market is relatively small, and large firms already have good access to financing.

WSJ : Shire to Buy NPS Pharmaceuticals for $5.2 Billion

Shire to Buy NPS Pharmaceuticals for $5.2 Billion
All-Cash Transaction Would Mark Return of Irish Drug Maker to Deal-Making

Shire PLC said it has agreed to buy NPS Pharmaceuticals Inc. for $5.2 billion in a takeover that would mark the Irish drug maker’s return to deal-making.

The all-cash deal would hasten Shire’s pivot to drugs for rare conditions and bolster its portfolio of therapies for gastrointestinal disorders like the ones treated by NPS’s two drugs, Shire Chief Executive Flemming Ornskov said. “It is another step in the direction of becoming a biotech,” he said in an interview.

The deal would be accretive in 2016 and is expected to close in the first quarter of this year, Dr. Ornskov said. He said combining NPS’s two drugs with Shire’s existing sales force could eventually yield blockbuster sales for each of the NPS therapies.

The agreement is Shire’s first major deal after AbbVie Inc ’s attempts to acquire Shire fell apart last October. Dublin-based Shire received a breakup fee of $1.6 billion after AbbVie walked away from the so-called tax-inversion deal. AbbVie scrapped the acquisition after the Obama Administration took steps to deter such tax-lowering deals.