MARKET CURRENTS
real-time news and commentary for investors
MARKET CURRENTS
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Today - Tuesday, May 21, 2013
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8:28 PM After five days of deliberation, the Senate Judiciary Committee puts its final stamp of approval on the immigration reform bill, setting up a debate on the Senate floor for early June. Three Republicans and ten Democrats voted to support the bill, which would create a pathway to citizenship for nearly 11M undocumented immigrants, invest billions in new border security measures and overhaul the legal immigration system. [U.S. Economy] 1 Comment
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7:40 PM Baltic Trading (BALT) announces a public offering of common stock. Size and terms weren't disclosed. The company intends to use the net proceeds from the offering for future vessel acquisitions or, to the extent it does not so use them, for working capital and general corporate purposes. Shares +1.8% AH. [Global & FX, On the Move] Comment!
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7:39 PM Amazon's (AMZN) ad ambitions pose a threat to Google (GOOG), thinks ReadWrite's Derek Brown. In addition to Amazon's vision/ambition, obsession with customer satisfaction, and willingness to forgo near-term profits, the e-commerce giant's mountains of consumer purchase data stand to give it an edge as it pushes ads on its sites, on Kindles, and through a targeted display ad network. Moreover, Amazon could provide customers/partners with "relevant online transaction activity that might follow [its ads], effectively offering a closed loop marketing environment unlike any other." Of course, Google isn't standing still either. [Tech, Consumer] Comment!
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7:38 PM Cyclacel Pharmaceuticals (CYCC) closes its previously announced underwritten offering totaling 6,833,334 shares at $3 per share for gross proceeds of approximately $20.5M. Shares +1% AH. [Healthcare] Comment!
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7:26 PM "We commend the positive steps taken by NetApp (NTAP) today" says Elliott Associates portfolio manager Jesse Cohn in response to news the enterprise storage giant has more than doubled its buyback authorization to $3B (with plans to buy aggressively), initiated a $0.15/share dividend (with plans to increase it), and is planning to cut ~900 jobs. Cohn adds Elliott, an activist investor, owns ~16M NetApp shares (good for a 4.3% stake), and looks forward to "the company's continued commitment to creating shareholder value." Shares +2.7% AH. (previous) [Tech] 1 Comment
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7:07 PM VMware (VMW, EMC) officially launches its vCloud Hybrid Service, which allows clients to pair on-premise workloads with a VMware-run public cloud infrastructure. VMware claims the service supports more than 90 OS', has high-availability options, and allows public and on-premise workloads to be jointly managed. VMware also says it will offer SAP software, including Hana, "as a subscription service on premise and in the cloud." vCloud Hybrid competes with Amazon Web Services, Microsoft's Azure (perhaps the most direct rival), and Rackspace's OpenStack offerings. ITWorld calls it "ideal for a significant set of enterprise applications," but adds it's "no Amazon killer," given AWS' focus on low cost and ease-of-use. [Tech] 3 Comments
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6:55 PM Why do so many investors believe in a summer rally? On average, in the 116 years since the Dow was created, the Dow gained 5.29% from the end of May through its highest close over the next three months. Before you get too excited, Mark Hulbert calculates that every season of the calendar can boast a rally of similar magnitude - 5.23%. [Quick Ideas] 2 Comments
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6:38 PM SolarWinds (SWI) attempts to move downmarket and obtain a stronger cloud presence by striking a deal to acquire private N-able for $120M in cash. Whereas SolarWinds' IT management offerings are more focused on enterprises (it has been gaining share here against the likes of CA, BMC, H-P, and IBM), N-able sells cloud-based IT management software to service providers, who in turn use them to offer IT management services to SMBs. (PR) [Tech, M&A] Comment!
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6:32 PM If you harbor doubts about the sharp rise of energy MLPs, you don’t have many short sellers on your side. Fewer than 1% of the shares of MLP constituents of the Alerian index (AMJ) are out on loan. Low short interest may have less to do with a lack of negative opinion than with the nature of who owns MLPs, but it’s a notable feature since it should mean a classic short squeeze isn’t possible. [Energy] 4 Comments
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6:27 PM France Telecom (FTE) will invest up to €50M ($64M) in video site Dailymotion and once more begin looking for a partner this fall, says Orange CEO Stephane Richard. With the French government (27% stake) having scuttled the Yahoo deal, FTE has reportedly been fielding Dailymotion bids from local tech/media players. [Tech, M&A] 1 Comment
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6:15 PM Telecom Italia (TI) is mulling a 3-way split, multiple sources tell Reuters: one unit would contain the carrier's Italian mobile ops, another its Italian wireline ops, and another Brazilian carrier TIM. The report come a month after TI's board signed off on talks with a Hutchison Whampoa about a possible Italian mobile merger (Hutchison's demands could get in the way), and ordered management to study the feasibility of a wireline spinoff. [Tech] Comment!
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6:12 PM Four companies ignoring their shareholders' votes, according to Theo Francis: Impax Labs (IPXL), where three directors were retained despite failing to reach 50% approval; Occidental Petro (OXY), which counted 55M non-voting shares as voting against a proposal; Hecla Mining (HL), which left open a say-on-pay vote for an extra month; and NYSE Euronext (NXY), which continues to thwart the right to call special shareholder meetings. [Energy, Healthcare, Financials] Comment!
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6:01 PM Apple (AAPL) roundup: 1) iOS 7 will reportedly feature integration with additional online services, including Flickr (YHOO) and video site Vimeo. Yesterday, Yahoo announced a big overhaul for Flickr. 2) Peter Misek remains downbeat, predicting Apple's gross margin will be pressured by its use of OGS touch sensor tech in the iPhone 6 (differs from the iPhone 5's in-cell tech), and by app processor price hikes from Samsung (checks indicate 25%-50% hikes). 3) As Senate hearings dominate headlines, EU leaders are looking to end the tax shelters Apple and other tech companies have created. 4) BrandZ again ranks Apple the world's most valuable brand; it's followed by Google IBM, McDonald's, and Coca-Cola. (Apple/Yahoo report) [Tech] 11 Comments
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6:00 PM On the hour: S&P +0.02%. 10-yr 0%. Euro +0.01% vs. dollar. Crude -0.05% to $95.95. Gold +0.02% to $1374.05. Comment!
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5:54 PM As a second U.S. liquefied natural gas export project gets the green light, Credit Suisse is the latest to predict how much LNG the U.S. might send overseas: potentially 10B cu. ft./day by the end of the decade. Growing confidence that more export approvals are ahead has lifted U.S. natural gas calendar-strip prices for 2015, '16 and '17 by 3%, 4% and 5%, respectively, CS says. (earlier) [Energy] 1 Comment
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5:50 PM Merck (MRK) says it's entered into an accelerated share repurchase agreement with Goldman Sachs to repurchase $5B worth of stock, as the company looks to alternative methods for increasing shareholder value. The company has been dealing with the loss of exclusivity for its blockbuster asthma-and-allergy treatment Singulair, leading to generic competition that wiped out much of the drug's more than $5B in peak annual sales. Shares +1% AH. [Healthcare] Comment!
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5:36 PM Enbridge (ENB) CEO Al Monaco says he's spending more time seeking public support for projects such as the proposed Northern Gateway pipeline than regulatory approval as opponents try to block new routes to market. New conduits are needed from Canada to correct a "huge disconnect” in North American oil prices as supply exceeds pipeline capacity - a $25B/year "value destruction" gap for Canada's economy. [Energy] 2 Comments
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5:35 PM 3D Systems (DDD) shareholders signed off on increasing the company's share authorization to 220M from 120M at its annual meeting. The 3D printer maker says the increase restores its flexibility to use stock "for appropriate corporate purposes." Do those purposes include another split and/or acquisitions? [Tech] 5 Comments
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