Frontrunning: August 26
- Bankers Brace for Fed Wind-Down (WSJ)
- A Veteran Saudi Power Player Works To Build Support to Topple Assad (WSJ)
- Gunmen shoot at weapons experts' vehicle in Damascus: U.N (Reuters) - as long as it's not drones
- ECB Council Members Split in Jackson Hole Over Rate Cuts (BBG)
- Fed Officials Rebuff Coordination Calls as QE Taper Looms (BBG)
- As Egyptians Ignore Curfew, Talk of a U.S.-Brotherhood Conspiracy (NYT)
- Pipeline-Capacity Squeeze Reroutes Crude Oil (WSJ)
- Lawmakers Probe Willful Abuses of Power by NSA Analysts (BBG)
- Indictments Expected in Alleged Trading Code Theft (WSJ)
- India’s ONGC takes Africa gasfield stake (FT)
- Capital Flight Drains Reserves as Rupee, Rupiah Fall (BBG)
- Banks scale back rates business (FT)
- Bo Xilai Lashes Out at Prosecutors as Trial Ends (WSJ)
Overnight Media Digest
* Goldman Sachs Group Inc will rack up tens of millions of dollars in losses for sending waves of erroneous orders into the stock-options market last week, according to a person familiar with the situation.
* Anadarko Petroleum Corp said Sunday it agreed to sell a stake in a natural gas field off the coast of Mozambique to a subsidiary of India's Oil & Natural Gas Corp for $2.64 billion.
* More crude oil is moving around the U.S. on trucks, barges and trains than at any point since the government began keeping records in 1981, and it is a precursor to what may be a larger change: the construction of more than $40 billion in oil pipelines now under way or planned for the next few years, according to energy adviser Wood Mackenzie.
* The top prosecutor in Manhattan is seeking to indict three men for allegedly stealing valuable computer source code from an automated trading firm, according to people familiar with the matter.
* Central bankers around the world are bracing themselves for more financial turbulence as the Federal Reserve prepares to wind down its easy-money policies. Global markets have reeled since May, when the Fed began signaling it could soon start scaling back its $85 billion-per-month bond-buying program.
* North Sea oil and gas producers are preparing contingency plans to continue operations after almost half their helicopter-supply fleet was temporarily grounded following a fatal crash on Friday. The region's three main helicopter operators Sunday cancelled flights using the Eurocopter AS322L2 model, whose crash reawakened safety concerns across the industry.
* Although Amgen Inc is the world's biggest biotechnology company, the
drug maker has been mostly absent from one of the industry's biggest and
fastest-growing markets: cancer drugs. It took a big step to fix that
on Sunday, agreeing to buy Onyx Pharmaceuticals for about $10.4 billion
in cash to gain access to the company's three anti-cancer treatments.
The New York State attorney general's office filed a civil lawsuit on
Saturday accusing Trump University, Donald J. Trump's for-profit
investment school, of engaging in illegal business practices.
Muriel Siebert, who became a legend on Wall Street as the first woman to
buy a seat on the New York Stock Exchange and the first woman to head
one of the exchange's member firms, died on Saturday in Manhattan. She
* Sixteen years after an acrimonious parting, Keith
Olbermann and ESPN are putting on happy faces for their highly
anticipated reunion, the premiere on Monday of "Olbermann" on ESPN2, the
spinoff channel that Olbermann helped start, falteringly, in 1993. This
time, both sides say, no faltering. The succinctly titled comeback
vehicle, making its debut at 11 p.m. Eastern Time, also returns
Olbermann to sports journalism after more than 10 years in hard news,
* The nationalized bank ABN Amro moved a
step closer to the public markets on Friday after the Dutch government
said it would seek an initial public offering for the bank. The
announcement comes five years after the Dutch government bailed out ABN
Amro after a consortium of European banks acquired the bank for around
72.2 billion euros, or $99 billion.
THE GLOBE AND MAIL
* A U.S. court has approved a multimillion-dollar settlement in a securities fraud class-action lawsuit against Oilsands Quest Inc, a Calgary-based exploration company in which embattled Senator Pamela Wallin was a director.
* Canada could be sending its first astronaut to the moon under an ambitious long-term plan being developed by a group of space agencies around the world. A return to the moon within the next two decades is part of the recently updated Global Exploration Roadmap, a far-reaching plan developed by more than a dozen space agencies.
Reports in the business section:
* A decision on the controversial and much-delayed oil sands pipeline to the U.S. Gulf Coast could be pushed into 2014 as a U.S. watchdog examines whether contracts tied to the Keystone XL review process were wrongfully awarded and regulatory safeguards fully adopted.
* Record low interest rates that sent Canadians into a binge of borrowing and home-buying are reverting to more normal levels. Still cheap by historical standards, loans are not nearly as cheap as just a few months ago.
* Quebec Premier Pauline Marois says the Parti Quebecois' planned Charter of Quebec Values - which would include a ban on religious headwear for public employees - will be a uniting force for the province. The charter will affirm, once and for all, the equality between men and women, she said, and it will reflect not only "universal" values, but Quebec values as well.
* A Mountie whose sexual harassment complaints against the Royal Canadian Mounted Police prompted dozens of similar allegations and heralded legislation to modernize discipline for "bad apples" within the force says her employer is moving to dismiss her.
* A long awaited report on pipeline safety commissioned by the Alberta government has taken an overall positive view of the province's regulations. But the study released on Friday was quickly dismissed by critics as lacking in substance as it neither examined the effectiveness of enforcement nor drew lessons from specific spills in recent years.
-- Some Chinese local government delegations who go to Hong Kong for business have competed for extravagancy in a trend that runs contrary to the central government's anti-corruption campaign, the ruling communist party's newspaper said.
-- Many social celebrities have voiced their support to government's campaign to crack down on rumour monsters in social media after the public securities bureau has recently detained some suspects for creating and spreading rumours.
CHINA SECURITIES JOURNAL
-- The China Financial Futures Exchange may launch government bond futures on Sept. 6. The futures, aimed at offering corporates a hedging tool and helping China's interest rate reforms, were previously planned to be launched as early as mid-August.
-- The National Development and Reform Commission, China's powerful price regulator, reaffirmed that it could target the petroleum, telecommunications, banking and auto sectors in its investigations into violations of the country's anti-trust laws.
SHANGHAI SECURITIES NEWS
-- The China Securities Regulatory Commission (CSRC) will take quick action to deal with irregularities such as false information disclosure in a tightening of supervision of the Chinese stock market, CSRC vice chairman Jiang Yang said.
-- Responding to media criticism of its handling of a glitch in Everbright Securities' trading system that led to abnormal trading on Aug. 16, a spokesman at the Shanghai Stock Exchange said it had fulfilled its duty properly.
Fly On The Wall 7:00 AM Market Snapshot
Aeropostale (ARO) upgraded to Hold from Sell at Brean Capital
Altera (ALTR) upgraded to Buy from Neutral at Citigroup
Amgen (AMGN) upgraded to Overweight from Neutral at Piper Jaffray
Arkansas Best (ABFS) upgraded to Strong Buy from Market Perform at Raymond James
Big Lots (BIG) upgraded to Neutral from Underweight at JPMorgan
Darling (DAR) upgraded to Buy from Hold at Canaccord
Dollar Tree (DLTR) upgraded to Buy from Hold at Deutsche Bank
Hasbro (HAS) upgraded to Buy from Sell at Citigroup
Health Net (HNT) upgraded to Positive from Neutral at Susquehanna
PCTEL, Inc. (PCTI) upgraded to Buy from Hold at Wunderlich
Pinnacle Financial (PNFP) upgraded to Buy from Hold at Wunderlich
ResMed (RMD) upgraded to Buy from Neutral at BofA/Merrill
Family Dollar (FDO) downgraded to Hold from Buy at Deutsche Bank
Scorpio Tankers (STNG) downgraded to Equal Weight from Overweight at Morgan Stanley
Tyson Foods (TSN) downgraded to Neutral from Buy at BofA/Merrill
3D Systems (DDD) initiated with a Buy at Citigroup
American Homes 4 Rent (AMH) initiated with a Market Perform at Wells Fargo
American Homes 4 Rent (AMH) initiated with a Neutral at BofA/Merrill
American Homes 4 Rent (AMH) initiated with a Neutral at Goldman
American Homes 4 Rent (AMH) initiated with an Outperform at FBR Capital
American Homes 4 Rent (AMH) initiated with an Overweight at JPMorgan
Ardmore Shipping (ASC) initiated with a Buy at Jefferies
Ardmore Shipping (ASC) initiated with an Overweight at Evercore
Stratasys (SSYS) initiated with a Buy at Citigroup
Wolverine World Wide (WWW) initiated with a Buy at Brean Capital
Amgen (AMGN) to acquire Onyx Pharmaceuticals (ONXX) for $125 per share in cash
Anadarko (APC) announced $2.64B transaction for portion of Mozambiqu offshore Area 1
Brookfield (BAM) terminated swap agreement with AIG (AIG)
Dell (DELL), Symantec (SYMC) in cloud-based SaaS solution agreement
Yahoo (YHOO) acquired image-recognition company IQ Engines
Companies that beat consensus earnings expectations last night and today include:
Qihoo 360 (QIHU)
- Whoever succeeds CEO Steve Ballmer at Microsoft (MSFT) will face the challenge of rebooting its corporate culture, in which charting the safe but profitable course, at least for the short term, too often wins out over innovation, say current and former employees and other industry executives, the Wall Street Journal reports
- More crude oil is moving around the U.S. on trucks, barges and trains than at any point since the government began keeping records in 1981, as the energy industry (NS, PSX, KMI) devises ways to get around a pipeline-capacity shortage to take petroleum from new wells to refineries, creating opportunities for transportation companies, the Wall Street Journal reports
- ING Groep (ING) edged closer to completing its year-and-a-half-old Asia divestment plan after selling its South Korean insurance unit for $1.65B. The sale will leave ING with its Japan insurance unit left to sell, bringing it closer to fulfilling its agreement with European regulators to offload more than 50% of its Asian operations by the end of 2013, Reuters reports
- The families that control Heineken (HEINY) said today they planned to buy up to $134M of shares in Heineken Holding. The grouping of the Heineken and Hoyer families, L'Arche Green N.V., holds 51.083% of shares in Heineken Holding, which in turn owns 50.005% of Heineken, Reuters reports
- Price gains of stocks in the S&P’s 500 Index are outpacing profits by the fastest rate in 14 years as the bull market extends beyond the average length of rallies since Truman was president. The benchmark gauge for U.S. equities has risen 14% relative to income over the past 12 months to 16 times earnings, according to Bloomberg data
- Taking a page from Apple’s (AAPL) playbook, a company it’s already beaten in China smartphone sales, Lenovo Group (LNVGY) is counting on a chain of retail stores to help it surpass leader Samsung Electronics (SSNLF), Bloomberg reports
Bulls see Peabody Energy (BTU) up 50% to 100% this year
Take-Two (TTWO) could jump 30%
Microsoft (MSFT) shares could prosper with new leadership
Arotech (ARTX) files $25M mixed securities shelf
Comstock Mining (LODE) files to sell common stock
Green Plains (GPRE) files $200M mixed securities shelf
Ikanos Communications (IKAN) files to sell $30M of common stock