>>> US Gapping down

In reaction to disappointing earnings/guidance: FINL -9.7% (light volume), BBRY -5.3%, BGCP -2.7%, NKE -2.6%, NQ -2.6% (also announces proposal to sell FL Mobile to Tack Fiori International Group Limited and become controlling shareholder).

Select pharma stocks trading lower: RHHBY -6% (Immunogen reported that Roche has announced top-line results of its Phase III Marianne study; Roche has reported the Marianne study showed the three regimens helped people live without their disease worsening ), SHPG -1.8%, AZN -1.8%, SNY -1.7%.

Select Euro financial related names showing weakness: BBVA -3.1%, SAN -2.9%, ING -2.6%, DB -1.9%...oil/gas related names: STO -2.3%, TOT -1.7%... telecom names are lower: PT -7% CHA -6.1% (ticking lower), TI -2.2%

Other news: IMGN -39.2% (Immunogen reported that Roche has announced top-line results of its Phase III Marianne study; Roche has reported the Marianne study showed the three regimens helped people live without their disease worsening ), RXII -11.9% (entered into an assignment and exclusive global license agreement with Hapten Pharmaceuticals for the therapeutic use of Samcyprone), NVGN -8.4% (entered private placement), GFI -3.6% (still checking), YNDX -2.7% (ongoing Russia related volatility), CRH -2.4% (still checking), NOK -2% (following BBRY results), TNK -1.9% (plans to offer 20,000,000 shares of Class A common stock; downgraded to Neutral from Buy at UBS, tgt raised to $6 from $5.50), BUD -1.9% (still checking), DEO -0.8% (still checking), MET -0.6% (has been designated as systemically importan by regulatorst, as expected), UA -0.5% (following NKE results), .

Analyst comments: SDRL -6.1% (downgraded at Goldman), EVC -1.4% ( downgraded to Neutral from Outperform at Wedbush ), MXIM -0.4% (downgraded to Neutral from Buy at Goldman), WAG -0.2% (downgraded to Neutral from Buy at SunTrust)
.

>>> US Gapping Up

In reaction to strong earnings/guidance: RHT +10.6%, PIR +7.9%, CTAS +7.3%.

M&A related: APP +4% (following late spike higher following NYPost report of takeover offer valuing company at $1.30-1.40/share), XRX +3.7% (Atos to acquire Xerox's information technology outsourcing business for $1.05 bln; does not anticipate earnings per share dilution beyond 2015; updates Q4 and FY15 guidance to reflect acquisition), CBST +1.3% (Merck (MRK) begins tender offer to acquire Cubist for $102.00 per share in cash), UTIW +0.8% (responds to Bloomberg report that UTIW is in 'advanced talks' to sell itself to DSV; UTIW states that those discussions never progress beyond a preliminary stage) .

A few Brazil names are trading higher: BRFS +3.9%, PBR +2.2% EBR +2.5%, CBD +1.5%

Other news: PETX +26.2% (announced positive top-line results from AT-001 pivotal field study in client-owned dogs with osteoarthritis), MOLG +13.7% (announces commencement of share repurchase program), CERS +13.6% (FDA approves intercept blood system for platelets), ISIS +7.1% (among stocks with favorable commentary on Thursday's Mad Money), MSG +4.6% (authorized and directed mgmt also to consider other spin-off structures including separation of the media business from its sports and entertainment businesses), KEG +3.7% (after 35% move higher yesterday), ALLY +3.3% (files for offering of common stock, size not disclosed; U.S. Department of Treasury launched offering to sell its remaining ~54.9 mln shares of Ally common stock), OREX+3.3% (confirms that the Committee for Medicinal Products For Human Use of the European Medicines Agency has adopted a positive opinion recommending the granting of a centralized marketing authorization for Mysimba), OGXI +3.1% (nnounced results from the randomized, controlled Phase 2 Borealis-1 trial evaluating low and high dose apatorsen in combination with gemcitabine/cisplatin chemotherapy compared to chemotherapy alone in the treatment of metastatic bladder cancer), RCAP +2.5% (following yesterday's 15%+ move lower following ARCP news; issues statement regarding recent market developments; says 'here have been no reported accounting irregularities at RCS Capital'), MBT +2.5%/ VIP +1% (Mobile TeleSystems partnered with VimpelCom to jointly roll-out and utilize LTE networks in 36 Russian regions), SIMG +2.4% (after 30% move lower yesterday), FRO +2.3% (cont strength), Q +1.9% (among stocks with favorable commentary on Thursday's Mad Money), TICC +1.3% (adopts stock repurchase program of up to $50 mln worth of common shares), PTCT +1.1% (Translarna Granted Orphan Drug Designation in the U.S. and Europe for the Treatment of Mucopolysaccharidosis), CQP +0.7% (Cheniere and GE Sign $1B Service Agreement for Sabine Pass LNG Export Terminal), NRZ +0.7% (increases quarterly dividend), GILD +0.4% (Gilead Sciences and Ono Pharma (OPHLY) announced that the companies have entered into an exclusive license agreement for the development and commercialization of ONO-4059), KO +0.3% (Coca-Cola Bottling Co. announces agreement with Coca-Cola to expand franchise territory).

Analyst comments: POT +1.8% (upgraded to Buy from Neutral at UBS; tgt raised to $40 from $38), ORAN +1.1% (upgraded to Buy from Hold at Deutsche Bank), RYAAY +1% (upgraded to Outperform from In-line at Imperial Capital; tgt raised to $85 from $60), IRBT +0.7% (initiated with Overweight and $42 target at Piper Jaffray),-hammer and fly after TWTR +0.7% (initiated with Perform at Opco; tgt $36), MPW +0.6% (upgraded to Hold from Underweight at KeyBanc Capital Mkts), AAPL +0.3% (positive Morgan Stanley comments related to iPhone demand
)

FT LEX : You can’t kill the S&P, can you? USA! USA! Or maybe not.


• What could possibly reverse US stocks? Lex thinks that the US has become a safety trade — as can be seen in the leadership of big-cap stocks and defensive sectors. So if the rest of the world starts to look a bit better (hard to imagine at the moment, of course, but that is exactly the point) the trade could unwind badly. Alternatively, if US companies could stop buying vast piles of their own shares, the treads will come right off the tank. Why this would happen Lex doesn’t know, but we’re thinking about it.
• What is the way to play emerging markets next year, given their sensitivity to all the factors that US shares ignore? Well, one can look to companies that sell to the US, such as manufacturers in Taiwan and Korea. Or one could hope for further political alpha in India.
• Thailand is an emerging market that has done well recently, particularly since the military coup in May. A tremor in SET index this week might just have been business as usual for an illiquid emerging market index. But the Thai economy is not strong. Political stability may not last for ever. Lex Advanced Long/Short Advisors is short the SET (note: LALA does not exist, and wouldn’t give investing advice if it did).
• What is a company to do if it is not lucky enough to be in the US? It is to merge. BT plans to buy EE, giving the full wireless/landline data package. It’s a sensible, if not wonderfully cheap, deal. It is worth saying, though, that it has nothing to do with growth. It’s about establishing a stable customer base and cutting costs.
• BP is about as far from the safety of the US as it is possible to be. It is up to its chest in Russia. It owns a fifth of Rosneft. Its dividend from Rosneft comes in roubles. And Rosneft contributes most of its forecast production growth. A further oil price decline will put the Russian company’s production targets in danger.
• Is 2015 the year when a cyber attack does permanent damage to a major corporation? Sony’s troubles with The Interview this week give a small taste of how an anonymous (not to say Anonymous) cyber thug can have a business impact. Lex hopes that the hoodlums behind the attack are forced to watch as Sony makes The Interview, despite the lack of a theatrical release, into an economic or public relations success.
To close on a seasonal note: Lex does not wish a Merry Christmas to executives who get paid based on the basis of total shareholder returns during their time in charge, whether with options or otherwise. We join an increasing number of pundits in pointing out that this doesn’t seem to be working out well for companies or shareholders. Bah humbug! Normal old salaries next year!
Season’s greetings to everyone else, and our thanks for reading the column this year.
All best
Robert Armstrong
Head of Lex

>>> US Early premarket gappers

Early premarket gappers

Gapping up: PETX +26.2%, CERS +13.6%, RHT +11.1%, PIR +7.9%, CTAS +7.3%, ISIS +7.1%, KEG +3.7%, XRX +3%, SIMG +2.4%, FRO +2.3%, COOL +2.2%, MSG +1.9%, POT +1.8%, CQP +1.6%, ALLY +1.5%, TICC +1.3%, ORAN +1.1%, COKE +0.9%, GILD +0.4%, RCAP +0.3%

Gapping down: SDRL -7%, PT -7%, BBRY -4.7%, YNDX -2.7%, BGCP -2.7%, CRH -2.4%, STO -2.3%, NKE -2.1%, TNK -1.9%, BUD -1.9%, DB -1.9%, SHPG -1.8%, TOT -1.7%, DEO -0.8%, MET -0.6%, UA -0.5%, NQ -0.4%

>>> BlackBerry beats by $0.07, misses on revs; reports 2 mln BBRY smartphones; c

--> BBRY - 4.77% Pre-Open - 280k shares traded

BlackBerry beats by $0.07, misses on revs; reports 2 mln BBRY smartphones; continues to target sustainable non-GAAP profitability some time in FY16

Reports Q3 (Nov) adj earnings of $0.01 per share, excluding non-recurring items, $0.07 better than the Capital IQ Consensus Estimate of ($0.06); revenues fell 33.5% year/year to $793 mln vs the $919.63 mln consensus.

  • The revenue breakdown for the quarter was ~46% for hardware, 46% for services and 8% for software and other revenue.
  • During the third quarter, the Company recognized hardware revenue on ~2 mln BlackBerry smartphones vs 2.2 mln ests vs 1.9 mln last year.
  • Non-GAAP and GAAP gross margin of 52%.
  • Outlook: The Company continues to anticipate maintaining its strong cash position, while increasingly looking for opportunities to prudently invest in growth. The Company continues to anticipate break-even or better cash flow from operations. The Company is expanding its distribution capability, and expects traction from these efforts to manifest some time in fiscal 2016. The company continues to target sustainable non-GAAP profitability some time in fiscal 2016.
  • Co also announced that BES12: a cross-platform EMM solution includes support for Android 5.0 Lollipop. Co also announced that Ocean Capital Investments, and its subsidiaries, members of the Irving family of companies, are migrating to BES12: a cross-platform EMM solution by BlackBerry.

WSJ :Airbus Selected for European Airborne Refueler Jet Contract

Airbus Selected for European Airborne Refueler Jet Contract
Netherlands, Norway and Poland Are Jointly Buying the Planes to Save Money

LONDON— Airbus Group NV has been selected by three European countries to provide their future airborne refueling jet over a rival offering from Boeing Co.

The Netherlands, Norway and Poland are jointly purchasing the planes to be used collectively to save money, the European Defense Agency that brokered the partnership said in a statement on Friday. The aircraft are due to be operationally available from 2019, the Brussels-based agency said.

Airbus will provide an initial four refueling planes based on its A330 jetliner, the Dutch ministry of defense said in a statement. The eventual fleet size could grow.

“Participating nations would welcome other nations to join the initiative either before on actual procurement or subsequently,” the EDA said. The program will be run by the European arms cooperation agency, Occar.

Western airstrikes against Libya in 2011 highlighted a shortfall in European airborne tanker planes needed to extend the range of shorter range fighter jets. European militaries had to heavily rely on U.S. refueling planes.

Airbus said last month it won a contract for 12 of its A330-based tankers, also called MRTT, or multi-role tanker transport, because the plane can carry personnel or cargo as well, from the French government.

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Airbus leads Boeing in foreign orders for its tanker plane, having been selected by Australia, the U.K., United Arab Emirates, Saudi Arabia, Singapore, India and Qatar. Boeing has a larger market share by aircraft numbers for its 767-jetliner based KC-46 because of the size of U.S. Air Force purchase plans.

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--CORMAC MULLEN

-0- Dec/19/2014 08:04 GMT