Frontrunning: September 30
- Government Heads Toward Shutdown (WSJ), First U.S. Shutdown in 17 Years at Midnight Seen Probable (BBG), Congress in game of chicken (RTRS)
- Italian Premier Pursues Last-Ditch Rescue of Government (WSJ)
- Election risk rattles Italian government bonds (RTRS)
- Obama and Ryan Stay on Sidelines on Budget (WSJ)
- Volcker Rule Costs Tallied as U.S. Regulators Press Deadline (BBG)
- Faltering Chinese Factory Growth Adds to Rebound Fears (FT)
- Health Law Hits Late Snags as Rollout Approaches (WSJ)
- Apple Overtakes Coca-Cola as Most Valuable Brand, Study Finds (BBG)
- Euro-Area September Inflation Slows More Than Forecast on Energy (BBG) - Puting will fix that shortly
- LOT airline Boeing Dreamliner forced to land in Iceland (Reuters)
- Threat of a Red October (WSJ)
- Abe Bets It’s Different This Time with Sales Tax Rise (BBG)
- Japan’s Real Borrowing Rate Turns Negative (FT)
- N.S.A. Gathers Data on Social Connections of U.S. Citizens (NYT)
- Siemens CEO Kaeser Cuts 15,000 Jobs to Catch Up With GE (BBG)
- Wall Street on a Budget Revives Greenwich Real Estate (BBG)
Overnight Media Digest
* The nation braced for a partial shutdown of the federal government, as time for Congress to pass a budget before a Monday midnight deadline grew perilously short and lawmakers gave no signs Sunday they were moving toward a resolution.
* Obama administration officials, scrambling to get the health law's insurance marketplaces ready to open on Tuesday, keep hitting technical problems, while government-funded field workers across the country say they aren't fully prepared to help Americans enroll in the program. Implementation of the law is expected to proceed even if the government partially shuts down because Congress fails to pass the necessary spending bills.
* Twitter is planning to make public its secret filing for an initial public offering as soon as this week. That means the social media and microblogging company's stock could begin trading by late October or early November, if the offering moves at full speed.
* Household names such as Twitter, Hilton Worldwide and Chrysler have raised the star power of this fall's slate of initial public offerings, renewing market observers' hopes that blockbuster IPOs will draw individual investors back into the stock market.
* In the coming month, markets face four huge tests: the Washington debt crisis, the release of September employment data, third-quarter earnings releases and the Federal Reserve's next policy meeting. All four of these horsemen could disrupt investments and some could tank the market. Money managers hope all will be nonevents and stocks will finish the year higher.
* Satellite operator DirecTV has struck a deal with startup movie studio A24 Inc to partner with it in acquiring independent films in exchange for rights to offer them exclusively on its video-on-demand services 30 days before they hit theaters.
* Shell plans to sell its stake in the Eagle Ford Shale in South Texas, following a $2 billion write-down of the company's North American assets. Shell's sale of leases on 106,000 acres in the oil-and-gas-rich region illustrates the struggles major oil companies have had in places where smaller energy firms have thrived.
* IBM agreed to settle allegations some company online job listings expressed a preference for foreign workers with temporary visas over U.S. citizens, the Justice Department said Friday. Under the terms of the settlement, IBM will pay $44,000 in civil penalties and revise its hiring and recruitment procedures to comply with the Immigration and Nationality Act. The company will also provide reports to the government for two years.
* A Boeing 787 Dreamliner jet operated by LOT Polish Airlines en route from Toronto to Warsaw landed in Iceland Sunday after Norway refused it entry because of the malfunction of a system that transmits airplane identification.
Italy's prime minister Enrico Letta is urgently seeking parliamentary support for a new government after centre-right leader Silvio Berlusconi pulled the rug under the five-month-old coalition, sparking fears of a backlash from financial markets.
The world's banks watchdog could relax stringent capital rules on securitisation or asset-backed products as part of a second look at the instruments blamed for triggering the global financial crisis
French insurer AXA SA is set to confirm the closing of a deal to spin off its private-equity arm early this week in a transaction that would value the unit at 510 million euros ($690.6 million).asd
Siemens AG, Europe's biggest engineering firm, is to slash 15,000 jobs over the next year as part of a 6 billion euro cost-cutting programme.
BP shot down a plan that might have stopped its 2010 oil leak in the Gulf of Mexico within a month as it worried more about defending its public statements about the flow rate from the well, the company's legal opponents have alleged.
Italy's largest retail bank Intesa Sanpaolo ousted CEO Enrico Cucchiani on Sunday, following a clash with Italian shareholders.
* King.com Ltd, the British mobile gaming company best known for its hit puzzle game 'Candy Crush Saga', has filed for a public offering in the United States, according to people briefed on the matter. It has also retained Bank of America Corp Merrill Lynch, Credit Suisse Group AG and JPMorgan Chase & Co to lead the offering, according to the people, who spoke on the condition of anonymity because the listing process is being done in secret.
* The Securities and Exchange Commission's insider trading trial against Mark Cuban, the billionaire who regularly sits courtside to cheer on his Dallas Mavericks basketball team, opens in a federal courtroom in Dallas on Monday. The case stems from Cuban's June 2004 sale of 600,000 shares of Mamma.com Inc, soon after he had supposedly learned of an equity offering that could depress the Montreal-based Internet search company's stock price.
* Tuesday is the long-awaited kickoff of President Obama's signature healthcare law, when millions of Americans can start signing up for new insurance options. Yet across the country, officials are issuing warnings that despite fevered efforts, their new insurance exchanges will not be fully operational for weeks or even months.
* The civil trial of British oil company BP Plc begins its second phase on Monday, which will set the amount of oil that spilled into the Gulf of Mexico from the 2010 Deepwater Horizon rig explosion that killed 11 workers and soiled hundreds of miles of beaches.
* The looming threat of a government shutdown on Tuesday is beginning to cause greater unease than past political disputes and may rattle markets when they reopen on Monday.
* Apple Inc is the new most valuable brand in the world, according to a closely followed annual report. The report, to be released on Monday, is from Interbrand, a corporate identity and brand consulting company owned by the Omnicom Group that has been compiling what it calls the Best Global Brands report since 2000.
THE GLOBE AND MAIL
* Major energy companies led by Imperial Oil Ltd have applied to drill for crude in the Beaufort Sea, targeting an area that could require operations in the deepest water yet for the industry in the Canadian Arctic. Imperial, Exxon Mobil Corp and BP PLC filed a project description with regulators this month as a first step in the proposed drilling on two jointly held licences about 175 kilometres northwest of Tuktoyaktuk, Northwest Territories. ()
* Monday brings a reading of Canadian gross domestic product for July. The consensus among economists is that the economy grew 0.5 per cent in the month - a reversal from June when floods in Alberta and the Quebec construction strike caused a 0.5-per-cent contraction. ()
Reports in the business section:
* A series of high-level meetings are under way to discuss how the British Columbia and Alberta provinces can open up the path to B.C.'s coasts, and then Asian markets. An agreement is not imminent, but officials for both the provinces are working on a framework to address B.C.'s five conditions. ()
* BlackBerry Ltd's prized intellectual property risks leaving the country, even if the troubled company winds up under Toronto-based Fairfax Financial Holdings Ltd's control. Only a limited number of buyers worldwide can afford the smartphone maker's patent portfolio. But for those who can, it is a find so rare that it has outsized value. ()
* The Conservative government is launching a $1.3 billion free market in medical marijuana this Tuesday, eventually providing an expected 450,000 Canadians with quality weed. Health Canada is phasing out an older system on Monday that mostly relied on small-scale, homegrown medical marijuana of varying quality, often diverted illegally to the black market.
CHINA SECURITIES JOURNAL
- China's September Consumer Price Index (CPI) is expected to rise 3 percent, according to Shenyin & Wanguo Securities' analysts. August CPI increased 0.4 percent.
SHANGHAI SECURITIES NEWS
- Hongyuan Securities said that Hu Qiang, its vice-chairman and general manager, and Zhou Dong, its deputy general manager, are being investigated by public security authorities.
- Residents in Shenzhen Bay, an area on the water dividing China and Hong Kong, are protesting plans to expand the Tuen Mun landfill lying on the Hong Kong side. The expansion plans were temporarily suspended after 50 residents took part in an overnight hunger strike in July.
- It is not advisable to consider the hitting of targets an achievement in itself, said an editorial in the paper that acts as the government's mouthpiece. It is important to continue educating oneself in order to maintain high standards, it said.
Fly On The Wall 7:00 Am Market Snapshot
ARIAD (ARIA) upgraded to Outperform from Perform at Oppenheimer
Accenture (ACN) upgraded to Hold from Sell at Societe Generale
CIT Group (CIT) upgraded to Buy from Neutral at Janney Capital
Chipotle (CMG) upgraded to Overweight from Equal Weight at Morgan Stanley
Chuy's (CHUY) upgraded to Outperform from Neutral at RW Baird
Colgate-Palmolive (CL) upgraded to Overweight from Equal Weight at Morgan Stanley
Enduro Royalty Trust (NDRO) upgraded to Neutral from Underperform at RW Baird
J.M. Smucker (SJM) upgraded to Buy from Neutral at Citigroup
Newpark Resources (NR) upgraded to Outperform from Market Perform at Raymond James
Rose Rock Midstream (RRMS) upgraded to Buy from Neutral at Citigroup
Santander Brasil (BSBR) upgraded to Neutral from Sell at Citigroup
Shire (SHPG) upgraded to Overweight from Neutral at JPMorgan
Spansion (CODE) upgraded to Overweight from Equal Weight at Barclays
Telecom Italia (TI) upgraded to Neutral from Underweight at JPMorgan
ARIAD (ARIA) downgraded to Market Perform from Outperform at BMO Capital
Achillion (ACHN) downgraded to Market Perform from Outperform at JMP Securities
Achillion (ACHN) downgraded to Neutral from Outperform at RW Baird
Achillion (ACHN) downgraded to Underperform from Neutral at BofA/Merrill
C.H. Robinson (CHRW) downgraded to Underperform from Sector Perform at RBC Capital
International Paper (IP) downgraded to Neutral from Buy at BofA/Merrill
Johnson Controls (JCI) downgraded to Underweight from Equal Weight at Morgan Stanley
Panera Bread (PNRA) downgraded to Equal Weight from Overweight at Morgan Stanley
RealPage (RP) downgraded to Underperform from Neutral at Credit Suisse
RockTenn (RKT) downgraded to Neutral from Buy at BofA/Merrill
Syngenta (SYT) downgraded to Neutral from Buy at Citigroup
WhiteWave Foods (WWAV) downgraded to Underperform from Market Perform at BMO Capital
CyrusOne (CONE) initiated with an Overweight at Evercore
EQT Midstream Partners (EQM) initiated with a Buy at Goldman
Marketo (MKTO) initiated with an Outperform at Wells Fargo
NextEra Energy (NEE) initiated with a Neutral at UBS
Penn Virginia Resource (PVR) initiated with a Buy at Citigroup
Telecom Italia (TI) CEO to plan resignation at board meeting, Bloomberg reports
Harvest Natural (HNR) announced negotiations to sell interest in Gabon for $137M
Orbital's Cygnus (ORB) spacecraft successfully berthed with International Space Station
MarkWest Energy (MWE) said pipeline, processing facilities remain shut
Advantage's (AAV) financial advisors commence marketing effort for sale of corporation
- Firms such as Twitter, Hilton Worldwide and Chrysler Group have raised the star power of this fall's slate of IPOs, renewing market observers' hopes that blockbuster IPOs will draw individual investors back into the stock market, the Wall Street Journal reports
- Facebook (FB) is laying down a new gauntlet in its battle with Twitter to dominate online conversation around TV: more data for broadcasters. This week it will begin sending weekly reports to ABC (DIS), NBC (CMCSA), Fox (FOX) and CBS (CBS), offering a glimpse of how much chatter their shows are generating on the social network, the Wall Street Journal reports
- Twitter plans to make its IPO filing public this week, news website Quartz reported, citing a person familiar with the social media network's plan, Reuters reports
- Glencore Xstrata (GLNCY) is unlikely to jump on OZ Minerals (OZMLY), sources say, playing down a report in The Mail that said Glencore was considering a $1.2B takeover offer, Reuters reports
- Warren Buffett’s Berkshire Hathaway (BRK.A) is set to get over $2B in Goldman Sachs Group (GS) stock through warrants acquired during the depths of the 2008 financial crisis, Bloomberg reports
- BlackBerry (BBRY) was so desperate to find a buyer that it agreed to pay its biggest shareholder a rare breakup fee for a tentative takeover offer, a move that could deter rival bidders, Bloomberg reports
AMC Networks (AMCX) could reach $80 in a year
Fairfax Financial (FFH, FRFHF) could earn $20 per share next year
Brink's (BCO) could rise 20%
Cumulus Media (CMLS) files to sell $100M of Class A common stock
Guaranty Federal Bancshares (GFED) files to sell $23M of common stock
Halcon Resources (HK) files to sell 158M shares of common stock for holders
Kythera (KYTH) files to sell $85M in common stock
Sequential Brands (SQBG) files to sell 16.92M shares of common stock for holders