Frontrunning: March 4


  • No need to use military force in Ukraine for now: Putin (Reuters)

  • Russia Orders Drill Troops Back to Bases (WSJ)

  • Ukraine premier agrees to reforms for aid package (FT)

  • Japan Base Wages Rise for First Time in Nearly Two Years (WSJ)

  • Only the algos are trading: Citigroup Joins JPMorgan in Seeing Trading-Revenue Drop  (BBG)

  • Vietnam sends blogger to prison for critical posts (AP)

  • At White House, Israel's Netanyahu pushes back against Obama diplomacy (Reuters)

  • Obama to offer new tax breaks for workers in election year budget pitch (Reuters)

  • China Banks Show Too-Connected-to-Fail Link to Shadow Loans (BBG)

  • Ex-BOK Deputy Lee Named to Head South Korea Central Bank (BBG)

  • Beijing's GDP Goal Under New Scrutiny (WSJ)

  • No mortgage origination problem in the UK: Mortgage approvals climb to six year high (Telegraph)


 


Overnight Media Digest


WSJ


* As Russia's military secured the Crimean peninsula, its currency hit a record low and its stock market plunged in the face of U.S. and European warnings of sanctions over the incursion into Ukraine.


* North Dakota's oil producers are choosing the greater flexibility of railroads to move crude to thirsty markets in the east and west, stranding two pipeline projects before they could begin.


* After months of ill-fated deals, the bankrupt city of Detroit has settled with two large banks for about 30 cents on the dollar in the city's only agreement so far with major creditors, according to court filings Monday.


* Standard Chartered PLC is nearing deals to sell roughly a half-dozen units in Europe, Asia and the Middle East, as part of an effort to combat an emerging-markets slowdown and worries about the bank's financial health, according to people familiar with the deals.


* Citigroup Inc said on Monday it received subpoenas from the Federal Deposit Insurance Corp and U.S. prosecutors, three days after the bank disclosed it had found allegedly fraudulent billings at its Mexico unit that cost it up to $400 million.


* Winter storms chilled U.S. auto demand in February as overall sales were flat on big gains at Fiat Chrysler Automobiles and Nissan Motor Co .


Single-digit percentage declines at General Motors Co , Ford Motor Co, Toyota Motor Corp and several others kept sales at 1.19 million cars and light trucks last month, off slightly from a year earlier, said researcher Autodata Corp.


* PNC Financial Services Group Inc has received a subpoena from the U.S. Department of Justice concerning its relationships with merchants for payment-processing services, the Pittsburgh-based bank disclosed in a regulatory filing Monday.


* Roche Holding AG will have more flexibility to pursue acquisitions in the coming year as the Swiss drug maker pays off the bulk of debt from its $47 billion buyout of Genentech.


* Dish Network Corp has agreed to curtail the use of a controversial ad-skipping feature on its latest digital video recorders for ABC shows, as part of a new long-term programming deal with ABC owner Walt Disney Co, the companies confirmed late Monday.


* The U.S. Supreme Court on Monday agreed to decide whether workers should be paid for time spent going through theft-deterrence screenings at the end of their shifts, taking up a case brought by Amazon.com Inc warehouse employees.


* A federal appeals court rejected BP Plc's effort to stop Gulf Coast businesses from collecting payouts from the Deepwater Horizon settlement fund, even when they can't directly trace their losses to the 2010 oil spill.


 


FT


Fears of a war in Ukraine wiped a tenth off the value of Moscow's stock exchange, sent the rouble tumbling to an all-time low and pushed up the price of commodities as the west scrambled to counter Russia's creeping invasion of Crimea.


Diplomats have been scrambling to lower tensions and offer Russian President Vladimir Putin a face-saving way out of the Ukraine crisis in order to avert war.


The British Prime Minister's office denied it was putting the interests of businesses based in London ahead of attempts to defuse the Ukraine crisis.


U.S. tobacco company RJ Reynolds is exploring a bid for rival Lorillard Inc, people familiar with the situation said.


Citigroup has issued a warning about revenue declines at its consumer banking, trading and investment banking businesses in the first quarter.


Ukraine is set to receive more than $2 billion in international aid after its acting prime minister promised to meet all economic reform demands needed to secure the aid package.


 


NYT


* The Obama administration suspended military ties to Russia, including exercises, port visits and planning meetings, just a day after calling off trade talks.


* Banamex USA, a banking affiliate of Citigroup Inc that handles transactions across the Mexican border, has become entangled in an investigation into compliance with rules on the monitoring of financial transfers.


* American refiners are refurbishing old plants or planning new ones to take advantage of new supplies of domestic crude.


* A federal appeals panel ruled that BP must pay gulf companies for damages without requiring proof of harm by the Deepwater Horizon spill.


* California voters imposed more generous living conditions for egg layers. But the Legislature's decision that imported eggs must to be produced under the same standards has drawn a lawsuit.


* The Federal Communications Commission leveled fines totaling $1.9 million on Monday on three of the nation's biggest media companies - Comcast Corp, Viacom Inc and Walt Disney Co - for "willfully and repeatedly" violating federal law by carrying a commercial.


* Maury Rosenberg says he lost his business after being forced into involuntary bankruptcy by a unit of U.S. Bancorp . A court later ruled the bankruptcy illegal, but by then the business was gone.


* Two of Carlyle's three founders plan to sell 7.5 million common units of Carlyle Group, according to a filing on Monday. Carlyle itself is selling 4.5 million common units. The offering of 12 million shares would raise about $435 million.


 


Canada


THE GLOBE AND MAIL


* The number of obese Canadians has tripled since the mid-1980s, a phenomenon driven by a sharp rise in the number of extremely overweight adults whose health complications are expected to place a heavy burden on the health-care system.


* Lawyers working for Kinder Morgan Inc have sent a letter to the National Energy Board proposing the narrowest interpretation of who can participate in a review of the company's proposed twinning of the Trans Mountain pipeline.


Reports in the business section:


* A year after being admonished for cutting mortgage rates too aggressively, banks are demonstrating a new, self-imposed restraint.


* Canada's dairy industry faces a grim future of stagnant sales, dwindling farms and lost opportunity if the country remains a bystander to a global boom in milk products trade, the Conference Board of Canada argues in a new study.


NATIONAL POST


* The libel trial of the controversial Sun News TV host Ezra Levant began in a Toronto courtroom with blunt questions and cautiously indignant answers from the alleged victim.


FINANCIAL POST


* Pacific Investment Management Co forecasts Canadian home prices falling as much as 20 percent in the next five years, removing the boost from household spending that contributed to faster-than-expected growth last quarter.


* Prime Minister Stephen Harper sharply criticized Taseko Mines Ltd and its controversial New Prosperity project on Monday, stating that an environmental report on the British Columbia project was "damning."


 


China


CHINA SECURITIES JOURNAL


- The southwestern inland municipality of Chongqing said detailed plans for its proposed free trade zone would be hopefully unveiled to the public after the opening of the annual session of the National People's Congress.


SECURITIES TIMES


- Easing liquidity conditions have pulled yields of money market investment funds lower than 5 percent since last week, with analysts predicting that money market funds marketed online may no longer be able continue offering high yields.


CHINA BUSINESS NEWS


- The PBOC said it was supportive of the development of the online financial service sector, responding to the appeals to strengthen regulation of online finance from traditional brick-and-mortar financial service providers.


- Li Yizhong, former head of Ministry of Industry and Information, called for reform of monopolistic industries by introducing more competition to selected parts of identified sectors.


CHINA DAILY


- Zimbabwe will allow China's yuan to be used as legal tender in the country.


- China National Offshore Oil Corp (CNOOC), the country's largest offshore oil and gas developer, has become the first Chinese firm licensed to look for oil in the Arctic, in partnership with Iceland's Eykon Energy and Petoro Iceland AS.


SHANGHAI DAILY


- Li Zhongyang, the deputy director of the Shanghai Health Promotion Committee said the city government was planning to introduce a ban on smoking in all public places within five years.


- Several types of headphones and earphones manufactured by Panasonic, Philips and some local firms failed quality checks after being found to pose risk to people's hearing, said Shanghai Quality and Technical Supervision.


- Shares of China Galaxy Securities Co Ltd, the country's sixth-biggest brokerage by revenue, dipped in Hong Kong on Monday, after it announced its plans to list in Shanghai.


 


Britain


The Telegraph


BP LOSES APPEAL OVER $9.2BN GULF OF MEXICO PAYOUTS


BP has lost its battle to clamp down on "absurd" payouts to alleged victims of the 2010 Gulf of Mexico oil spill, after an appeals court said it must restart payments from its $9.2 billion compensation fund.


MORTGAGE APPROVALS CLIMB TO SIX-YEAR HIGH


Mortgage approvals rose to their highest level in more than six years in January, amid growing confidence in the housing market and record low borrowing costs.


The Guardian


ROLLS-ROYCE FACES FRESH BRIBERY ALLEGATIONS IN INDIA


Rolls-Royce has been plunged into fresh crisis after India became the latest country to launch a formal investigation into allegations of bribery and corruption at the British defence and engineering firm.


UKRAINE CRISIS SENDS RUSSIAN STOCK MARKET TUMBLING


The Moscow stock market suffered one of its biggest one-day falls in recent years and the rouble tumbled sharply in a first nervous reaction to the Kremlin's gambit in Crimea.


The Times


CRIMEA CRISIS SENDS GLOBAL INVESTORS FLEEING FOR SAFETY


Turmoil gripped world markets on Monday as investors reacted to the armed stand-off between Russia and Ukraine in Crimea, with the FTSE 100 suffering its worst day in two months as more than 25 billion pounds was wiped off the value of its biggest companies.


'MINDER' IAN TYLER STEPS IN TO KEEP WATCH ON G4S


The Cabinet Office will announce on Tuesday that Ian Tyler, the former chief executive of Balfour Beatty, has been appointed as a £500-a-day Crown Representative - or "minder" - to G4S, the troubled outsourcer.


The Independent


BUSINESS LENDING FALLS AGAIN IN FRESH BLOW FOR BANK OF ENGLAND


Bank of England Governor Mark Carney faced a fresh setback on Monday as another drop in loans to businesses overshadowed the latest figures from Threadneedle Street's flagship scheme to kick-start credit.


SERCO BEEFS UP BOARD IN WAKE OF TAGGING SCANDAL


Scandal-hit Serco continues to strengthen its board with the appointment of three heavyweight non-executives days after it poached Rupert Soames from Aggreko as its new chief executive.


 


 


Fly On The Wall 7:00 AM Market Snapshot


ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
New York ISM for February at 9:45 am--prior reading 64.4


ANALYST RESEARCH


Upgrades


Abercrombie & Fitch (ANF) upgraded to Outperform from Neutral at Credit Suisse
GrafTech (GTI) upgraded to Buy from Hold at Jefferies
Hilton (HLT) upgraded to Buy from Neutral at Goldman
Magna (MGA) upgraded to Neutral from Sell at Goldman
Magna (MGA) upgraded to Neutral from Underweight at JPMorgan
PulteGroup (PHM) upgraded to Buy from Hold at KeyBanc
SunEdison (SUNE) upgraded to Overweight from Equal Weight at Morgan Stanley
WNS Holdings (WNS) upgraded to Outperform from Neutral at RW Baird


Downgrades


AngloGold (AU) downgraded to Sell from Neutral at UBS
Cliffs Natural (CLF) downgraded to Underperform from Market Perform at Wells Fargo
Dendreon (DNDN) downgraded to Market Perform from Outperform at Bernstein
Fresenius Medical (FMS) downgraded to Underweight from Neutral at HSBC
Intuitive Surgical (ISRG) downgraded to Hold from Buy at Cantor
Lennar (LEN) downgraded to Hold from Buy at KeyBanc
Madison Square Garden (MSG) downgraded to Hold from Buy at Needham
Solazyme (SZYM) downgraded to Neutral from Buy at Goldman
Starwood Hotels (HOT) downgraded to Neutral from Buy at Goldman
Time Warner Cable (TWC) downgraded to Neutral from Outperform at Macquarie
Watts Water (WTS) downgraded to Market Perform from Outperform at Cowen


Initiations


Argos Therapeutics (ARGS) initiated with an Outperform at JMP Securities
Argos Therapeutics (ARGS) initiated with an Overweight at Piper Jaffray
Avon Products (AVP) initiated with a Sell at UBS
Church & Dwight (CHD) initiated with a Buy at UBS
Clorox (CLX) initiated with a Sell at UBS
Coca-Cola Enterprises (CCE) initiated with a Neutral at UBS
Coca-Cola (KO) initiated with a Neutral at UBS
Colgate-Palmolive (CL) initiated with a Buy at UBS
Dr Pepper Snapple (DPS) initiated with a Neutral at UBS
Energizer (ENR) initiated with a Sell at UBS
Estee Lauder (EL) initiated with a Buy at UBS
GT Advanced (GTAT) initiated with a Buy at Goldman
Infinity Pharmaceuticals (INFI) initiated with an Underperform at Wedbush
Ladder Capital (LADR) initiated with an Outperform at Keefe Bruyette
Monster Beverage (MNST) initiated with a Buy at UBS
Procter & Gamble (PG) initiated with a Neutral at UBS
Santander Consumer USA (SC) initiated with a Buy at Citigroup
Santander Consumer USA (SC) initiated with a Buy at Deutsche Bank
Santander Consumer USA (SC) initiated with a Buy at UBS
Santander Consumer USA (SC) initiated with a Neutral at Goldman
Santander Consumer USA (SC) initiated with a Sector Perform at RBC Capital
Santander Consumer USA (SC) initiated with an Outperform at BMO Capital
Santander Consumer USA (SC) initiated with an Outperform at Credit Suisse
Santander Consumer USA (SC) initiated with an Outperform at Wells Fargo
Tenneco (TEN) initiated with a Buy at UBS


COMPANY NEWS


Disney (DIS), DISH Network (DISH) signed a long-term distribution agreement
Sony (SNE) says PlayStation 4 has sold over 6M units as of March 2
S&P revised J.C. Penney (JCP) outlook to stable from negative
McDermott (MDR) withdrew prior guidance, suspended future guidance
Enbridge (ENB), Enbridge Energy (EEP) to undertake $7B mainline replacement program
Alexion (ALXN) said NICE acknowledged Soliris as effective treatment for aHUS
Synta Pharmaceuticals (SNTA) said CEO Safi R. Bahcall, Ph.D., resigned; A newly formed executive committee will serve as the principal executive body for the company until a new CEO is named


EARNINGS


Companies that beat consensus earnings expectations last night and today include:
DXP Enterprises (DXPE), NuVasive (NUVA), Ambac Financial (AMBC), Molycorp (MCP), Black Diamond (BDE), MBIA (MBI), Ascena Retail (ASNA), URS Corporation (URS), Guidewire Software (GWRE), Synageva (GEVA), Amicus Therapeutics (FOLD), Vipshop (VIPS)


Companies that missed consensus earnings expectations include:
AuRico Gold (AUQ), AcelRx (ACRX), McDermott (MDR), PDL BioPharma (PDLI)


Companies that matched consensus earnings expectations include:
TherapeuticsMD (TXMD)


NEWSPAPERS/WEBSITES


Buffett's (BRK.A) succession plans remain vague, Reuters reports
Archer Daniels (ADM), Bunge (BG) said operations haven't been affected by Ukraine turmoil, WSJ reports
BP (BP) considers options after Gulf court setback, Reuters reports
Broadcasters (DISH, TWC, CMCSA, FOXA, DIS) backed by Justice Department in Aereo fight, Re/code reports
Sprint (S) sued by U.S. officials for overbilling $21M for wiretap services, AP reports
Roche (RHHBY) cash position provides acquisition flexibility, WSJ reports
JPMorgan (JPM) to pay $400M to settle Syncora lawsuits, Reuters reports
DISH (DISH) to curtail ad-skipping for ABC shows (DIS), WSJ reports
Loral Space (LORL) hires Perella to advise on sale, Reuters reports  


SYNDICATE


ACADIA (ACAD) files to sell $150M in common stock
Ardmore Shipping (ASC) files to sell 6M shares of common stock
Artisan Partners (APAM) files to sell 7M shares of Class A common stock
Atlas Resource Partners (ARP) files to sell 5.5M common units
BioLineRx (BLRX) files to sell American Depositary Shares
Carlyle Group (CG) files to sell 12M common units
GTx (GTXI) raises $21.3M in a private placement
Mandalay Digital (MNDL) files to sell common stock
MannKind (MNKD) enters $50M at-the-market agreements
OvaScience (OVAS) files to sell common stock
Regulus Therapeutics (RGLS) files $100M mixed shelf, 7.9M shares for holders
Stock Building Supply (STCK) files to sell 6.6M shares of common stock


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