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Japan offers upbeat economic assessment. For the first time since May of 2012, Japan's Cabinet Office says its coincident index is "improving," which indicates the government sees "a high likelihood of an economic expansion" based on the composite of 11 key economic indicators. "The indicators that most contributed to the rise were manufacturing-related numbers, such as industrial output and industrial electricity usage," WSJ notes. The positive assessment comes on the heels of the Bank of Japan's more sanguine take. On Thursday, the central bank said the economy is "recovering moderately."

Obama seeks consensus on Syria at G-20. President Obama is facing a divided international community at the G-20 summit in St. Petersburg, as the White House attempts to shore up support for a punitory strike on the Assad regime for its alleged use of chemical weapons. Italy is reportedly concerned about sparking a wider conflict, Germany wants to take the matter to the ICC and Russia is reluctant to take a stance against Assad. Broad international support would go a long way towards erasing some of the uncertainty that still surrounds a proposed strike, and the market, as the old saying goes, hates uncertainty.

Top Stock News
Apple mulls varying iPhone screen sizes: WSJ. Thursday was a busy day for the Apple (NASDAQ:AAPL) rumor mill. Notably, the WSJ reported the company "has begun evaluating a plan to offer iPhones with screens ranging from 4.8 inches to as high as six inches." Moreover, sources state AAPL's "internal deliberations and plans indicate it appears more willing to move ahead than in years past." While AAPL weighs its options, phablet demand is soaring, particularly in Asia. IDC estimates phablet sales doubled Q/Q and rose 620% Y/Y in Asia-Pac (exc. Japan) in Q2, to 25.2M units (nearly even with regional notebook and tablet sales combined). The popularity of large-screen phones, together with strong demand for low-end Android phones in emerging markets, has contributed to the iPhone's recent share losses in Europe and Asia (outside of Japan).

Japan's largest mobile carrier to offer iPhone. DoCoMo, by far Japan's largest carrier, is likely to announce a partnership with Apple (AAPL) on the day of its iPhone launch. AAPL has announced an iPhone satellite event will take place in Tokyo hours after its main Sep. 10 event in Cupertino. Previous talks between AAPL and DoCoMo reportedly faltered due to AAPL's purchase requirements and DoCoMo's insistence on pre-installing some of its apps. DoCoMo has been losing share to SoftBank (OTCPK:SFTBF) and KDDI in large part due to its failure to carry the iPhone.

Facebook draws scrutiny over privacy policy. Facebook (NASDAQ:FB) is facing fresh questions about privacy as proposed new language in the social network's policy seems to allow for the indiscriminate use of members' information, likeness, and user-generated content for advertising purposes. FB is attempting to "routinely use the images and names of users for commercial advertising without consent," privacy groups warn. The Electronic Privacy Information Center, Center for Digital Democracy, Consumer Watchdog, Patient Privacy Rights, U.S. PIRG, and the Privacy Rights Clearinghouse have taken their concerns to the FTC via a letter dated September 4.

Timken to split steel and bearings businesses. After putting up a protracted fight, Timken (NYSE:TKR) finally bowed to activist pressure Thursday and agreed to split its steel and bearings businesses. In May, a narrow majority of shareholders voted for the split after CalSTRS and Relational Investors argued that a spinoff of the steel business was the best way to unlock value. The market appeared to agree, as the shares rose some 16% from the time votes were cast through Thursday's close.

Smith & Wesson issues tepid guidance. Smith & Wesson (NASDAQ:SWHC) posted FQ1 results that beat on both lines Thursday evening, but the gun company's guidance fell short of Street estimates, sending the shares lower in after-hours trading. SWHC said it sees EPS of $0.20-0.22 for FQ2 on revenue of $135-140M, well below analysts' estimates of $0.29/share on sales of $143M. For the full year, the company upped its guidance to $1.30-1.35/share on revenue of $610-620M.

Ford's Mulally may step down earlier than expected: Reuters. Ford's (NYSE:F) board may be willing to allow CEO Alan Mulally to step down ahead of schedule, people familiar with the matter have told Reuters. A succession plan unveiled last year had Mulally remaining CEO through 2014, but the board — which is reportedly "warming" to the notion of COO Mark Fields taking the reins — is considering letting him "determine the timing of his potential exit," as he considers "another high-profile job to follow up his tenure." For his part, Mulally says he is "absolutely focused on serving ... Ford."

As for Keystone: Who cares? It appears two years of delays may have finally rendered the Keystone XL Pipeline irrelevant. Valero (NYSE:VLO), for instance, "no longer considers the pipeline critical to its business," WSJ says. VLO has opted to expand its rail terminals instead of waiting for the government to bless TransCanada's (NYSE:TRP) ambitious project. Additionally, rival Enbridge (NYSE:ENB) is set to shell out more than $2B to expand its pipelines' capacity to move crude from Canada and North Dakota to the Midwest. Even so, some warn that heavy crude supply may outstrip shipping capacity within three years if the pipeline doesn't get the go ahead.

Top Economic & Other News
Three Democrats may vote against Summers for Fed chief. Senate Banking Committee members Jeff Merkley of Oregon, Sherrod Brown of Ohio, and Elizabeth Warren of Massachusetts are among Democrats who will not support Larry Summers for Fed chief, WSJ says, citing congressional aides. If the three Democrats do indeed oppose him, Summers will need the support of at least some Republicans in order to get through the Committee to a vote on the Senate floor, as Democrats' majority on the panel is two seats. Facing potential opposition from both sides of the aisle, Summers may not be the best choice considering the market's disdain for uncertainty.

German exports fall despite eurozone recovery. German exports fell 1.1% M/M in July, surprising economists who were expecting an increase of 0.7%. The news seems to contradict recent data which shows the eurozone may be pulling itself out of the economic doldrums — the EU is Germany's largest trading partner. Imports rose 0.5% and the Germany's current account surplus narrowed to €14.3B.

Alpha-Rich Stock Movers and Great Calls
1) Wednesday, Helix Investment Research laid out the long case for SeaChange International (NASDAQ:SEAC), stating the market hasn't accounted for SEAC's growth prospects on the upside, while the company's cash hoard offers downside protection. The stock is +7.2% to date. Read article »
2) On July 8, Devon Shire explained why TriOil Resources (OTC:TRIAF) was greatly undervalued, with recent deals auguring well for the company's pending sale. The stock is +21.8% since. Read article »

Alpha-Rich Stocks To Watch
1) Ambit Biosciences (NASDAQ:AMBI) is unlikely to have earnings available for shareholders before 2017, and the net present value of risk-adjusted future earnings below the current market capitalization, making for a tempting short opportunity. Read article »
2) A recent rights offering highlights a fatal flaw in Imperial Holdings' (NYSE:IFT) model. Barring a drastic increase in mortality rates, the company's value looks unsettling, creating a short opportunity. Read article »

Alpha-Rich articles are the best long and short ideas on Seeking Alpha. SA Pro subscribers receive early access to these Alpha-Rich articles, which often move markets. For more information about SA Pro and becoming a subscriber, click here.

Today's Markets:
In Asia, Japan -1.45% to 13860. Hong Kong +0.1% to 22621. China +0.83% to 2139. India +1.5 to 19263.
In Europe, at midday, London -0.16%. Paris -0.12%. Frankfurt -0.3%.
Futures at 6:20: Dow -0.13%. S&P -0.05%. Nasdaq +0.11%. Crude +0.2% to $108.60. Gold -0.3% to $1368.00.

Today's economic calendar:
8:30 Non-farm payrolls

Notable earnings before today's open: SFD, MFRM

Notable earnings after today's close: SHFL

See full real-time earnings coverage »

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Source: Wall Street Breakfast: Must-Know News