Emirates ponders $30B order for Boeing jets. Emirates Airline is in advanced talks with Boeing (NYSE:BA) to buy up to 100 777 jets in what could be a record-breaking order worth over $30B. The carrier is also looking at buying planes from Airbus (OTCPK:EADSF), including the A380 super-jumbo and the new A350. Emirates could be a launch customer for the next generation of Boeing's 777 and thereby receive a "substantial discount." The news comes a week after a report that regional rival Etihad was close to an $18B deal with Boeing.
U.K. government to stop short of RBS break-up. U.K. Finance Minister George Osborne reportedly plans to tell state-owned RBS (NYSE:RBS) to create an internal "bad" bank of £40B of toxic assets rather than break itself up. The strategy would negate the need for a vote of independent shareholders, some of which oppose a full split into "good" and "bad" banks. Osborne may also order RBS to float its U.S. retail bank, Citizens, earlier than a previous target date of 2015. Shares were +1.5% in London at the time of writing.
Top Stock News
Apple's EPS seen falling, revenues seen nudging higher. Apple's (NASDAQ:AAPL) FQ4 earnings are due out after the bell, with analysts expecting that EPS fell to $7.93 from $8.67 last year even as revenue edged up 2.2% to $36.8B. There has been much speculation that sales of the lower cost but not-so-cheap iPhone 5C have lagged those of the premium 5S, but who cares, the latter provide better margins. Investors will be looking to see what Apple's forecasts are for the holiday season, while some evidence that it can still revolutionize wouldn't go amiss either.
Celgene arthritis treatment effective, safe after a year - study. Celgene's (NASDAQ:CELG) twice-a-day pill Apremilast helped bring about notable and lasting reductions in the signs and symptoms of psoriatic arthritis in a late-stage trial of 527 patients who hadn't previously been treated for the disease. Subjects received the drug for a year. If approved - the FDA is due to make a decision in March - sales of Apremilast could reach $475M-1.5B over the next few years, depending on whom you ask.
Toyota remains world's largest car company by volume. Helped by the falling yen, Toyota's (NYSE:TM) sales rose 2.8% to 2.5M vehicles in Q3, outstripping GM's (NYSE:GM) 2.4M and Volkswagen's (OTCPK:VLKAF) 2.33M. Toyota's nine-month sales edged up 0.1% to 7.41M, enabling the company to keeps its crown as the world's biggest seller of cars. In the U.S., Toyota's Q3 shipments climbed 12% to 586,016 vehicles, which was enough to beat Ford (NYSE:F) for the first time in almost four years but put it behind GM.
Fed scrutinizes bank exposure to mReits. The New York Fed has reportedly been taking a "deep dive" into banks' exposure to mortgage real estate investment trusts (mReits) (NYSEARCA:REM), which fund acquisitions of long-term mortgages with short-term repo borrowings and which have proliferated since the financial crisis. The fear is that a rapid increase in interest rates could force the mReits to quickly cut their holdings of mortgage-backed securities and spark a wider sell-off. MReit giants include Annaly (NYSE:NLY) and American Capital (NASDAQ:AGNC).
Obamacare helping health-insurance stocks. The Affordable Care Act appears to have so far proved beneficial to investors in health insurers. Over the past year, the share prices of the five top firms in the sector — Aetna (NYSE:AET), WellPoint (WLP), UnitedHealth Group (NYSE:UNH), Humana (NYSE:HUM) and Cigna (NYSE:CI) — have increased an average of 32%, well above the S&P 500's rise of 24%. Health insurers predict that their earnings will grow after Obamacare is fully in effect, as they expect to gain more customers from people being forced to buy coverage.
Top Economic & Other News
Kirchner's majority falls in Argentinian Congress. Argentine markets will be in focus following mid-term Congressional elections yesterday in which the left-wing Victory Front coalition of President Cristina Kirchner saw its majority fall. Argentine stocks (NYSEARCA:ARGT) and bonds had rallied ahead of the vote on hopes that more business-friendly politicians would do well and set them up nicely for a Presidential run in 2015. One big winner was former Kirchner ally Sergio Massa, who has called for changes in policy to fight runaway inflation.
Falling oil prices threaten Permian boom. The Permian Basin is all the rage on Wall Street, but oil prices need to stay high enough to support the current rate of exploratory drilling - and prices for West Texas crude have dropped below $100 a bbl. The Permian remains the largest U.S. oil producer, although it's also the most expensive U.S. shale formation in which to drill, meaning the boom could become a bust if crude moves near $70 a bbl, as some analysts predict.
Alpha-Rich Stock Movers and Great Calls
1) The Toronto-listed shares of Maple Leaf Foods (OTCPK:MLFNF, MFI.TO) are +20.5% since October 2, when Mike Arnold noted that the company's restructuring carries as much as 50% upside over the next two years. Read article »
2) Adecoagro (NYSE:AGRO) is +31% since July, when Stephen Simpson said the pessimism surrounding the shares ignores continued opportunities in Brazilian ethanol. Read article »
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In Asia, Japan +2.2% to 14396. Hong Kong +0.5% to 22807. China flat at 2134. India -0.4% at 20595.
In Europe, at midday, London +0.1%. Paris -0.3%. Frankfurt +0.1%.
Futures at 6:20: Dow +0.2%. S&P +0.25%. Nasdaq +0.4%. Crude +0.05% to $97.90. Gold flat at $1352.70.
Ten-year Treasury Yield +1 bps at 2.5%.
Notable earnings after today's close: AAPL, ACGL, AGNC, AMKR, ARE, CGNX, CMP, CR, DATA, DENN, ECOL, ECOM, EXR, FMC, GGP, HIG, HLF, HLIT, HLS, IDTI, JLL, MAC, MAS, NCLH, NEU,NTRI, OII, OLN, PCL, PEI, PMCS, PRE, PSMI, RBC, RGA, RVBD, SANM, STX, TXRH
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