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  • CNOOC inks deals on shale, LNG. CNOOC (CEO) will pay $1.08B for a one-third stake in Chesapeake Energy's (CHK) Eagle Ford shale project in Texas, marking the biggest acquisition of a U.S. oil and gas asset by a Chinese company. CNOOC will also fund 75% of Chesapeake’s share of drilling and completion costs until an additional $1.08B has been paid. Though the project is CNOOC's first energy asset in the U.S., China's third-largest oil company has spent over $3.8B in the past year on energy acquisitions. CNOOC also announced that GDF Suez (OTCPK:GDFZY) will supply it with 2.6M tons of liquefied natural gas over four years, in a deal valued at more than $1B. The deal marks CNOOC's first medium-term LNG agreement as it tries to find strategic partners. Premarket: CHK +2.8% (7:00 ET).
  • Statoil, Talisman create shale gas JV. Statoil Norway's Statoil (STO) scored another deal to help it boost its U.S. shale gas operations, announcing a joint venture with Canada's Talisman Energy (TLM) to acquire acreage on the highly-sought Eagle Ford project in Texas for $1.325B. The deal will give Statoil recoverable reserves of about 550M barrels of oil equivalent, and follows a previous U.S. shale deal signed in 2008 with Chesapeake Energy (CHK).
  • No FDA clearance for Jazz Pharma's fibromyalgia drug. Jazz Pharmaceuticals (JAZZ) said the FDA had failed to clear for marketing JZP-6, its potential treatment for fibromyalgia. The FDA had cited "the need for additional clinical studies" as well as "methods for ensuring safe use" as some of the factors in its decision. Jazz plans to meet with the agency to clarify the letter before making a decision on its next steps for the drug. Premarket: JAZZ -10.4% (7:00 ET).
  • Major snag for Constellation Energy's nuclear project. Constellation Energy (CEG) said on Saturday that it wouldn't move forward with an application for a federal loan guarantee essential to its plans to build a new nuclear reactor in Maryland. Calling the government's terms "unworkable," Constellation's decision to pull out of the government program has all but killed the project. It's the latest (and seemingly last) in a string of challenges that has plagued the project over the last five years, and further strains relations between Constellation and its French partner, Electricite de France. EDF called the decision disappointing, while a federal spokesman said the announcement took officials by surprise and that Constellation was being urged to look at a new set of terms.
  • Rival suitors prep Potash bids. BHP Billiton (BHP) may face some competition for Potash (POT) after all, with reports that Canada's Ontario Teachers' Pension Plan is planning a spoiler bid. OTPP is said to be in talks to partner with Singapore's sovereign wealth fund Temasek on the bid, with Teck Resources (TCK) thought to be involved as well. The early-stage discussions have covered both an outright takeover or the purchase of a minority stake. Separately, China's Sinochem has reportedly approached Indian state-run miner NMDC about a joint bid for Potash, though NMDC denies it has any designs on the "very expensive property." If no rival bids are successful, Potash is reportedly considering defensive moves, including a break-up of the business, to fend off BHP. Premarket: BHP -0.6% (7:00 ET).
  • No currency resolution at IMF meeting. Exchange rates dominated the agenda at the IMF's annual meeting, but global financial leaders failed to find common ground. Officials blamed exchange rate imbalances on everything from China's undervaluation of the yuan to unilateral currency intervention by countries like Japan to America's monetary expansion, which has flooded the international economy with capital. Unable to forge an agreement amongst themselves, countries turned to the IMF to serve as a "currency cop" by preparing reports which show how one country's policies affect the economies of others; the reports will focus on the U.S., U.K., China and the eurozone. Currencies will likely dominate the agenda once again when G-20 leaders meet in November.
  • OECD sees global economy slowing. The global economy appears to be slowing, and most developed and large developing countries are already in a downturn, according to the OECD's latest composite leading indicators. It's the second month of decline for the forward-looking CLIs, which are designed to provide early signals of turning points between economic expansion and slowdown, and "the outlook given by the CLIs for Canada, France, Italy, the United Kingdom, Brazil, China and India points strongly to a downturn."
  • States broaden foreclosure probe. The attorneys general of up to 40 states plan to announce as soon as Tuesday a joint investigation into banks' use of flawed foreclosure paperwork. Banks have been reeling from the robo-signing scandals which stemmed from the disclosure that some bank officials signed off on hundreds of foreclosure documents a day without properly reviewing the paperwork. The pressure of such a large-scale joint investigation could prompt banks to follow the lead of Bank of America (BAC), which just days ago announced a temporary halt on foreclosures in all 50 states.
  • China lifts reserve ratio for top banks. China has reportedly lifted the reserve requirement for its top banks by half a percentage point, its first such move since May as it tries to drain cash from the economy. The nation's six largest commercial lenders will have to set aside 17.5% of their funds. Bank of America Merrill Lynch analysts said the rate hike was rumored to be punishment for lax oversight of the amount of new loans issued in September.

Today's Markets

  • In Asia, Japan closed. Hong Kong +1.1% to 23207. China +2.5% to 2807. India +0.4% to 20340.
  • In Europe, at midday, London +0.3%. Paris +0.2%. Frankfurt +0.2%.
  • Futures: Dow +0.2%. S&P +0.25%. Nasdaq +0.3%. Crude +0.2% to $82.84. Gold +0.3% to $1349.50.

Monday's Economic Calendar

Seeking Alpha's Market Currents team contributed to this post.


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