Friday, November 27, 2015
- Thanksgiving Day box office was up 20% Y/Y as viewers flocked to The Hunger Games: Mockingjay Part 2 as well as a pair of strong offerings, in the latest Rocky franchise film and a new family offering from Pixar.
- Mockingjay Part 2 (LGF -0.5%) drew $10.4M Thursday to bring its domestic total to $146.7M ($388M worldwide total), and should prevail over the five-day holiday weekend -- though it will get a challenge as post-feast families show up for The Good Dinosaur (DIS -3%).
- That film grossed $6.56M, bringing it to $16.4M after a Wednesday opening. It took the second spot just ahead of Creed (TWX -0.7%), featuring Michael B. Jordan and the latest portrayal of Rocky Balboa by Sylvester Stallone. Creed grossed $6.45M, though in nearly 500 fewer theaters.
- Lions Gate's film is showing legs but still pacing behind Mockingjay Part 1's performance a year ago.
- The only other key opening was the much-delayed Victor Frankenstein (FOX -1.4%, FOXA -1.2%), which failed to draw interest, pulling just $470K on the holiday, and a two-day total of $1.1M.
- The media M&A world is full of hot rumors, but it's a little notable that Rupert Murdoch decided today to get into the gossip game (or at least the trolling game).
- The mogul tweeted today about "strong word" that Tribune Publishing (TPUB -1.6%) was going to be bought by a "big Wall Street firm," and that the Los Angeles Times would be bought by Eli Broad and a local group.
- As Jason Abbruzzese points out, Murdoch could just have sour grapes, as News Corp. (NWS -1.6%, NWSA -1.3%) was rumored to be preparing a bid for the company last year before Murdoch said ownership laws "from another age" prevented that.
- “I am not sure this amounts to ‘case closed,' ” Poynter’s Rick Edmonds said at that time. “My read is that Mr. Murdoch still wants the L.A. Times, still opposes the cross-ownership ban and might seek an exception or repeal.”
- News Corp. A shares moved up 1.1% in postmarket trading after the abbreviated session.
- The FDA today declined to approve an expanded use for Bristol-Myers Squibb's (NYSE:BMY) Opdivo to treat another type of advanced skin cancer.
- Earlier this week, the company won approval for the immuno-oncology drug to treat advanced kidney cancer, as well as single-agent treatment of patients with BRAF V600 wild-type melanoma.
- But with a "complete response letter," the agency declined to approve the drug for treating BRAF V600 mutation positive metastatic melanoma -- a skin cancer that is both the rarest and deadliest. It indicated a need for additional data from the patient population.
- Opdivo has received approval for five other indications since its first approval last December.
- Previously: FDA clears new indication for Bristol-Myers' Opdivo (Nov. 24 2015)
- Previously: Bristol-Myers wins FDA approval for Opdivo to treat advanced kidney cancer (Nov. 23 2015)
- Telus (TU +0.5%) says it intends to buy and cancel up to 3.75M common shares through private transactions.
- The purchases will be made with an arm's-length third party, and the shares will be counted toward the 16M common shares that the company is entitled to buy for cancellation under its 2016 normal course issuer bid.
- Purchases will come at a discount to share price on the Toronto Stock Exchange at the time of purchase.
- In setting its new repurchase program in September, the company says it's targeting an ongoing 10% annual dividend increase.
- Shares in the company are down 13% YTD.
- Brazilian officials say the government will file suit Monday against Vale (NYSE:VALE) and BHP Billiton (NYSE:BHP) and their joint venture Samarco for 20B reais ($5.3B) in response to this month's mining dam disaster.
- The Attorney General's office says the 20B reais is a preliminary figure and could be raised over the judicial process.
- The proceeds from the civil suit are intended to create a fund to help recovery efforts in the Rio Doce, the river that was contaminated with mud and mining waste in the wake of the Nov. 5 collapse of Samarco’s dam in Minas Gerais.
- The pending lawsuit would represent by far the biggest government response to the disaster.
- Earlier: BHP sinks after UN dam spill accusations
- Germany's Supreme Court handed a victory to Deutsche Telekom (OTCQX:DTEGY +0.8%) and Telefonica (TEF +0.7%) in a rights case, but left the door open for holding Internet service providers responsible for blocking sites offering illegal music downloads.
- The court dismissed a pair of cases -- one brought by musical-rights society GEMA against Deutsche Telekom, the other brought by music companies against Telefonica's German unit O2 Deutschland -- saying the plaintiffs hadn't done enough to halt copyright violations in the first place.
- But it went on to rule: "The company that offers Internet access will only be held responsible for blocking the site when the copyright holder has first made reasonable efforts to take action against those who have themselves infringed their rights, like the website operators, or those who have enabled the infringement, like the Web hosting providers."
- This summer, a German court had ruled that YouTube was only responsible for blocking infringing videos when they had been brought to its attention, and wasn't expected to scan every video.
- Sanofi (NYSE:SNY) is up 1% after hours on news it's working with investment bank Lazard to prepare a sale or listing of Merial, its animal health unit, which could value the division up to €12B (about $12.7B), Reuters is reporting.
- On an investor day Nov. 6, new chief Olivier Brandicourt discussed cost cuts and acquisitions, but hinted at strategic options for unloading Merial and its European generics business due to limited synergies.
- Lazard has a close relationship with Sanofi via the drugmaker's chairman, Serge Weinberg. Sanofi may favor an IPO for the unit to avoid antitrust challenges in selling to a rival, sources told Reuters.
- Merial has about 6,500 employees and expects to exceed €2.4B in sales this year.
- The generics business is worth up to €3B, but any divestment faces a longer path with heavy legal disentanglement ahead, and wouldn't start until the second half of next year.
- Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) fell to its lowest level since its 1999 London listing, as the miner continues to buckle under slumping natural resource prices.
- HSBC on Wednesday downgraded its rating on the stock to Reduce and cut its price estimate to 410 pence, saying Anglo will continue to burn through cash even after cutting costs and potentially scrapping its payout to shareholders.
- HSBC anticipates "more near-term pain" and no "clarity on a long-term resolution to reverse potential cash burn," and adds to speculation that the company may follow rival Glencore (OTCPK:GLCNF, OTCPK:GLNCY) in cutting its dividend.
- HSBC also says that while Anglo’s niobium and phosphate business in Brazil and parts of its South African coal operations were viable candidates for sale, the company may struggle to raise significant funds in the current market.
- Separately, Anglo is denied permission by New South Wales planning authorities to expand its Drayton coal mine, ruling that an expansion would pose a risk to nearby horse stud farms; Anglo says it likely will close the mine, which would put 500 miners out of work.
- S&P +0.06%.
- 10-yr -0.05%.
- Euro -0.19% vs. dollar.
- Crude -2.95% to $41.77.
- Gold -1.32% to $1,055.90.
- Gold prices fell to their lowest level in more than five years today, heading towards $1,000/oz. as funds liquidate positions on rising expectations of Fed interest rate hikes next month.
- Gold fell as much as 2% to hit a low of $1,052/oz. before settling 1.3% lower at $1,056.20/oz. on Comex following six straight weeks of losses, while silver also slipped more than 1% to approach six year lows; conversely, the dollar hit an eight-month high.
- Gold and silver mutual funds and ETFs suffered $1B in outflows in the week ended Nov. 25, the most in 17 weeks, according to BofA Merrill chief investment strategist Micheal Harnett.
- With November’s jobs report coming next Friday, "next week is going to be pivotal" for the gold market, says Julius Baer analyst Carsten Menke, who also cautions that a reversal in sentiment was unlikely.
- ETFs: GLD, SLV, GDX, NUGT, IAU, AGQ, GGN, PSLV, DUST, SIL, PHYS, USLV, SIVR, SGOL, ZSL, UGL, GLDX, DGP, GTU, GLL, UGLD, DZZ, SLVO, GLDI, SGDM, DSLV, ASA, OUNZ, SLVP, DGL, DBS, DGZ, RING, DGLD, PSAU, USV, TGLDX, GEUR, UBG, GYEN
- NXP Semiconductors (NASDAQ:NXPI) jumped 4.6% in the short session today, and Freescale (NYSE:FSL) gained 4%, after the two won approval from China's Ministry of Commerce to finish their $40B merger -- a last major hurdle to the deal.
- The EU and U.S. FTC had signed off previously. The companies now expect to close Dec. 7, concurrent with the divestment of NXP's RF amplifier unit.
- The two have predicted $500M in eventual annual cost synergies, and have targeted $200M in cost savings in the first year after closing. NXP expects it to be accretive to EPS and free cash flow.
- Previously: NXP +6%, Freescale +5.5%; U.S. clears NXP's RF amplifier unit sale (Nov. 24 2015)
- Previously: NXP rallies following FBR Top Pick call, takes Freescale with it (Nov. 18 2015)
- S&P +0.06%.
- 10-yr -0.05%.
- Euro -0.15% vs. dollar.
- Crude -2.95% to $41.77.
- Gold -1.32% to $1,055.90.
- Gazprom's (OTCPK:OGZPY) deputy chief executive Alexander Medvedev is expected to meet the European Union's antitrust head next month in a meeting that could determine the outcome of the EU's case against the Russian company, Reuters reports.
- The company is accused of overcharging customers and blocking rivals in eastern Europe, a case which could end in a steep fine and changes to its business model; the two sides reportedly are far apart on the issue of pricing.
- Gazprom, which supplies around a third of the EU's gas, will defend its case at a closed-door hearing on Dec. 15, according to the report.
- Federal regulators rejected a claim by Delta Air Lines (DAL +0.6%) that American Airlines (AAL +0.9%) failed to start service quickly enough to Tokyo's Haneda airport -- meaning that American will keep the right to fly from Los Angeles to Haneda, a favored transit point for business travelers.
- American will have until March 27 to begin flights to Haneda; the carrier had said it would start daily service Feb. 11.
- Only four routes travel to Haneda (closer to Tokyo than Narita International Airport) from the U.S., and Delta surrendered one of them to American in June. But in an Oct. 1 filing it argued American should give up the route if it couldn't start service in 60 days.
- That followed an earlier dispute between the two over service to Haneda from Seattle -- where Delta ceded a route after being required to fly it daily.
- The increasingly bitter fight over Canadian Oil Sands' (OTCQX:COSWF) potential to attract bids to rival Suncor Energy’s (NYSE:SU) $4.3B hostile takeover offer led to tense exchanges at yesterday's Alberta Securities Commission hearing.
- A representative with J.P. Morgan, SU's advisor and supporting the company’s position that COSWF should not be allowed to change its shareholder rights plan in an attempt to fight off the takeover offer, said no one was likely to make a competing bid for COSWF.
- The rep said the possibility that Imperial Oil and its parent company Exxon Mobil, long rumored as suitors, was remote since neither had made an offer to date, even though either could do so quickly given IMO's ownership of 25% of Syncrude.
- The Canadian Oil Sands rep RBC, however, said 25 interested parties were reviewing the "opportunity," with four signing confidentiality agreements and "a good prospect" for at least one proposal.
- The Commission is expected to issue its decision on the COSWF shareholder rights plan before SU’s Dec. 4 deadline; if it rules in favor of COSWF, then shareholders would have until early April to make a decision if the SU bid is not withdrawn before then.
- In the holiday lull, Chinese game maker KongZhong (KZ -0.4%) said it's approved a sale of most of its stake in Ourgame International to Glassy Mind Holdings, for $30.9M.
- The deal involves selling 39.2M shares of Ourgame at a price of HK$6.1062 -- coming to about $30.9M with about 80% in immediate cash, and the remainder in cash on Sept. 30, 2016.
- KongZhong had held the shares since before Ourgame went public in Hong Kong in June 2014. It will retain a stake of about 2.6% (20.74M shares).
- Stocks ended the abbreviated session little changed, following relatively busy overnight trading that featured a 5.5% dive in China's Shanghai Composite.
- For the week, the S&P ended +0.1% while the Dow finished -0.1% and the Nasdaq was +0.4%.
- Weak showings today in the consumer discretionary (-0.4%) and energy (-0.7%) sectors were offset by gains in the remaining sectors; media names kept the discretionary sector under pressure as Disney fell 3%, while energy retreated as crude oil fell 2.5% to $41.97/bbl.
- Only 378M shares changed hands at the NYSE floor.
- Treasury prices also are little changed, with the 10-year yield at 2.23%.
- Yelp (YELP -1.1%) has claimed a victory in court, winning a dismissal of a lawsuit challenging the company over the quality of reviews placed on the site.
- The suit claimed that Yelp overstated the authenticity and quality of its reviews, which let Yelp insiders sell at inflated prices, but Judge Jon Tigar said reasonable Yelp investors would understand that reviews aren't firsthand -- a "common-sense understanding of what it means for a website to host user-generated content."
- Tigar said he found no basis to conclude that insider sales of $81.5M worth of stock were out of line with prior sales.
- The plaintiff, Joseph Curry, also tried to show that Yelp tried to extort ad payments from businesses in order to suppress bad or fake reviews.
- Towerstream (NASDAQ:TWER) finished down 1.3% after its filing disclosing a notice from Nasdaq that the company is at risk for delisting after spending 30 straight days under a minimum closing bid of $1.
- The company will get a standard 180-day grace period to regain compliance, by raising minimum closing bid over $1.00 for 10 consecutive business days.
- Nano cap Harvard Apparatus Regenerative Technology (HART +25.4%) jumps on triple normal volume. Shares are up almost four-fold sine November 11 as investors take positions ahead of a presentation by CEO Jim McGorry at an investor event in Los Angeles on Tuesday, December 1.
- Before the rally, shares had lost ~95% of their value on diminished prospects for the company's regenerated tracheas.
- The company generated some recent buzz with its report of clear evidence of esophageal tissue regeneration in animal studies based on its second generation bioengineered platform. The company plans to file an IND with the FDA in 2016 and aims to commence compassionate use procedures in humans sometime in 2016.
- Previously: Harvard Apparatus backs out of Russia (Nov. 26, 2014)
- Previously: HART up 34% on exoneration of misconduct by famed trachea transplant surgeon (Aug. 31)
- Previously: HART gets delisting warning from Nasdaq over share price (Nov. 10)
- Dow -0.07% to 17,801.10. S&P +0.07% to 2,090.35. Nasdaq +0.22% to 5,127.10.
- Treasurys: 30-year -0.21%. 10-yr -0.04%. 5-yr +0.03%.
- Commodities: Crude -2.53% to $41.95. Gold -1.18% to $1,057.40.
- Currencies: Euro -0.12% vs. dollar. Yen +0.21%. Pound +0.39%.
- Turkcell (TKC -2.7%) says it has launched voice and video calls on BiP, its IP-based messaging app.
- BiP has been downloaded for free more than 3.3M times (by Turkcell subscribers and otherwise) in more than 166 countries. The app also features disappearing messages a la Snapchat.
- The voice and video addition is coming along with 1 GB of free data for Turkcell's subscribers, though. The company plans to launch it in Ukraine and Belarus, in local languages with local content.
- "We believe Thanksgiving shopping was a bust," says SunTrust, following channel checks in the New York metro area, New England, and the Southeast starting yesterday and continuing through the night into Black Friday.
- Team members dispatched to malls had no problem finding parking or navigating stores, says SunTrust, and there seemed to be more browsing than buying going on.
- Lines at Wal-Mart (WMT -0.5%) and Target (TGT +0.3%) were about half of last year, but Kohl's (NYSE:KSS) was the exception to lame traffic.
- Joining Kohl's among early winners according to SunTrust are Aeropastale (ARO +0.8%), Abercrombie & Fitch (ANF +0.2%), American Eagle Outfitters (AEO -0.4%), and Kate Spade (KATE -2.6%). New York & Co. (NWY +1.9%) was among the early losers. Gap (GPS -2.7%) scores both a win and a loss, with Old Navy looking good, but Gap stores not so much.
- Hanging out at Minneapolis' Mall of America, KeyBanc's Edward Yruma says traffic looks weaker than past years. "It doesn't look much busier than an average Saturday morning."
- ETFs: XLY, XRT, VCR, RTH, RETL, FXD, FDIS, RCD, PMR, BITE
- Abengoa Yield (ABY -3%) is working with JPMorgan Chase as it seeks a buyer for its parent company Abengoa’s (ABGB -19.7%) 47% stake, Bloomberg reports.
- ABY hopes to find a long-term investor to guarantee its sustainability as an independent business after the parent company filed for preliminary protection from creditors, according to the report.
- ABY operates solar and wind farms, desalination plants, transmission lines and conventional power plants in eight countries on four continents, which will provide steady revenue streams for years to come and should make ABGB’s stake attractive to buyers.
- Abertis (OTCPK:ABRTY) tower spinoff Cellnex has been widely expected to put in bids for Infrastrutture Wireless Italiane, the cell-site spinoff form Telecom Italia (TI +4.7%), but despite a formal launch to the sale, TI says it's gotten no offers.
- "The process is still in an early phase and no offer has been received by Telecom Italia at this moment," the company said.
- Price may become an issue. On Wednesday, Bloomberg reported that Cellnex (and partner F2i SGR) were near a $1.2B bid for an Inwit stake, though that could come in the second week of December.
- Telecom Italia has a 60% stake in Inwit and would likely aim to keep about 20% along with one board seat.
- J.P. Morgan sees a strong end to the year for automakers Ford (NYSE:F) and General Motors (NYSE:GM), with a particularly strong November in the U.S. ahead as well as China sales beating expectations.
- The firm's Ryan Brinkman sees U.S. light vehicle SAAR heading up to 18.5M in November from October's 18.1M (which itself was up 10% Y/Y) -- meaning that not only would November purchases beat all other November figures, they would be the most of any other month in the current cycle.
- While incentives are down Q/Q, they're up about $100 Y/Y but resulting in average transaction prices up more than $1,000 from a year ago.
- “Some automakers we spoke to were surprised at the rate of improvement in recent months, pointing to unexpectedly strong consumer reaction to only modestly higher incentives, which has lowered inventories (a recipe for strong profitability),” Brinkman wrote.
- Previously: U.S. auto sales expected to set a record in November (Nov. 24 2015)
- Halliburton (HAL -0.4%) refiles a request for European Union antitrust approval of its takeover bid for Baker Hughes (BHI +0.3%), four months after the EU rejected an earlier application because of insufficient data.
- The European Commission reportedly will decide by Jan. 12 whether to clear the deal or open a full investigation.
- U.S. antitrust regulators also also looking at the deal, while Canada, Kazakhstan, South Africa and Turkey have approved; Australia's antitrust agency raised concerns last month and will issue its decision on Dec. 17.
- Gazprom (OTCPK:OGZPY) has agreed to buy all of the liquefied natural gas from the Perenco export plant in Cameroon being developed by Golar LNG (NASDAQ:GLNG) and due to start operating in 2017.
- Gazprom will take 1.2M metric tons/year of LNG from the project, as it aims to boost its portfolio in LNG as supply grows and the fuel takes an increasing role in global gas trade.
- Wells Fargo estimates the contract could result in natural gas delivered at $7-$8/MMBtu, which would be more than 3x the current U.S. price near $2.21/MMBtu.
- Dow -0.03%.
- 10-yr -0.02%.
- Euro -0.16% vs. dollar.
- Crude -2.44% to $41.99.
- Gold -1.22% to $1,056.90.
- Deere (DE -1.2%) is maintained with an Outperform rating and $87 price target at Credit Suisse, after better ag margins enabled the company to report Q4 results ahead of expectations.
- DE expects to underproduce retail demand again in HHP but not to the same degree as FY 2015, with production more in line with retail demand moving into H2 2016, Credit Suisse says.
- The firm notes the company’s CFO is expected to be strong at $2.6B, with excess cash likely to be used for niche M&A and share repurchases.
- Credit Suisse cuts its FY 2016 EPS estimate to $4.35 from $4.45 but maintains its $5.55 estimate for 2017.
- Infrastructure investment is singled out by RBC analyst Shelby Tucker as an attractive sector heading into year-end, with FirstEnergy (FE +0.9%) as a top pick.
- If the 2014 purchased power agreement from Ohio's utilities gains approval, Tucker thinks it could add $150M-$200M of additional pre-tax income for FE's competitive energy services segment, and that the benefit to the company could translate to $0.15-$0.30 in EPS; the analyst says the outcome is not included in valuation models and estimates.
- Along with FE, Tucker rates NextEra Energy (NEE +0.6%) and PNM Resources (PNM +0.5%) as Outperform, with respective stock price targets of $39, $128 and $32.
- VimpelCom (NASDAQ:VIP) is down 1.9% with firms coming in for price target cuts on the Russia-focused telecom.
- Barclays has reduced its price target to $4.82; ADRs closed yesterday at $3.60 and are trading at $3.53 today. Meanwhile, HSBC lowered its price target to $6.40.
- HSBC has a Buy rating on the stock, while Barclays holds an Equal Weight rating.
- The company also announced it's combining its Pakistan mobile business, Mobilink, with Global Telecom Holding's Warid Telecom in a large consolidation. Mobilink will first acquire 100% of Warid's shares in consideration for Dhabi Group shareholders acquiring about 15% of Mobilink, before the two companies are fully merged.
- The combination will serve more than 45M customers and the two companies logged combined revenue of $1.4B over the past 12 months. VimpelCom and Global Telecom expect synergies of $500M in the tie-up.
- In his first extensive interview since taking over as CEO two years ago, Chesapeake Energy (CHK -3.6%) CEO Doug Lawler tells WSJ he was surprised to learn that 54% of CHK's projects were not profitable in 2012.
- Problems at the time included CHK and former CEO Aubrey McClendon signing contracts to drill hundreds of wells without regard for their economic viability and transporting some natural gas on specific pipelines or facing large penalties, according to Lawler; as a result, CHK spent nearly $30B more on drilling and leasing than it brought in from its operations during 2010-12.
- Lawler says CHK's biggest challenge now resides outside the company: low natural gas prices.
- Warren Buffett in 2008 famously made a $1M wager with hedge fund Protege Partners that the S&P 500 would outperform a basket of hedge funds (net of fees) for the 10-year period beginning on Jan. 1, 2008 - a bet The Oracle is well on his way to winning.
- A fan of Buffett (BRK.A, BRK.B) and an investor alongside him for as long as he can remember, Seeking Alpha contributor Chris DeMuth suggests the problem with the bet (at least for Protege) was fund selection. He proposes a new bet of $1M with Buffett that his Rangeley Capital outperforms the S&P 500 over the 10-year period starting on Jan. 1, 2016.
- News Corp. (NWS -1.6%, NWSA -1.3%) says its Australian unit has secured five-year rights to the National Rugby League in an $1.8B deal.
- In conjunction with Nine Entertainment and Telstra (TLSYY +0.4%), Fox Sports secured the rights to show all games ad-free in 2016, and in 2017 will launch a dedicated NRL channel.
- Fox Sports package subscribers will also have access to the games and related coverage on tablets and smartphones.
- Dow -0.13%.
- 10-yr +0.01%.
- Euro -0.16% vs. dollar.
- Crude -2.21% to $42.09.
- Gold -1.26% to $1,056.50.
- Under activist pressure to break up the entire company, AIG (AIG +0.5%) is considering the sale of blocks of life insurance policies, reports Bloomberg - a move similar to those taken by Hartford Financial, XL Group, CNA Financial, and Allstate in recent years as those insurers sought to narrow focus to property and casualty business.
- Among those who have been buyers of life business of late are Reinsurance Group of America (NYSE:RGA), Wilton Re (Canadian Pension Plan Investment Board), Resolution Life and Protective Life (now owned by Dai-Ichi Life).
- AIG management is resisting Carl Icahn's urge to split the life and P&C operations into separate companies, but has promised more measured approaches to improve returns. A formal update is expected prior to the reporting of Q1 earnings.
- Rio Tinto (RIO -2.2%) says it is lining up project financing for a $4B expansion of its long-delayed Oyu Tolgoi copper mine in Mongolia and will make a final investment decision early next year.
- "What we need is consistency and stability and we believe we have the right environment today," Rio copper and coal chief executive Jean-Sebastien Jacques says. according to Reuters.
- Rio's Turquoise Hill Resources (TRQ +0.4%) subsidiary owns 66% of Oyu Tolgoi, with Mongolia's government owning the remainder of the project, located in the Gobi desert near Mongolia's border with China.
- The FDA's Psychopharmacologic Drugs Advisory Committee will meet on Tuesday, December 1, to review privately held Fabre-Kramer Pharmaceuticals' New Drug Application (NDA) for gepirone hydrochloride extended-release tablets for the treatment of major depressive disorder (MDD).
- FDA briefing doc
- Company briefing doc
- Draft questions
- MDD-related tickers: (OTCQB:VSTA)(OTCPK:OTSKY)(OTCPK:TKPYY)(NYSE:PFE)(NASDAQ:ALKS)(NASDAQ:AVNR)(NYSE:TEVA)(NASDAQ:SHPG)(NYSE:LLY)(NYSE:GSK)
- Abengoa (ABGB -27.4%) says Santiago Seage is stepping down as CEO after six months on the job and focus on his role as managing director of Abengoa Yield (ABY -4.3%), part of a management shuffle after the company filed for creditor protection.
- CEO duties will be shared by Chairman Jose Dominguez Abascal, who becomes executive chairman, and new general director Joaquin Fernandez de Pierola Marin, who had been chairman of Abengoa Mexico.
- Abengoa said today it is seeking creditor protection, a step that gives a four-month window during which it can suspend payments to creditors while negotiating a debt restructuring; the move follows this week's collapse of rescue talks.
- A piece in the Nikkei Asian Review says Apple "plans to introduce organic light-emitting diode displays for iPhones starting in 2018," though no sources are cited.
- Cowen's Robert Stone - who has Outperform ratings on both Universal Display (OLED +6.1%) and LG Display (LPL +1.1%) - expects Apple to eventually adopt an AMOLED display, subject to establishing sufficient capacity. "Capacity commitments are apparently being sought for 2018, by which time we expect the technology of choice is likely to be on flexible substrate."
- In the meantime, he says, look for AMOLED's (both rigid and flexible) to continue taking market share from LCD displays with other smartphone OEMs in China and elsewhere.
- Source: Barron's
- Walt Disney (DIS -3.3%) tumbles more than 3% in early trade after disclosing late Wednesday that ESPN subscribers fell 3.2% Y/Y to 92M as of Oct. 3 - a level last seen a decade ago - from 95M a year earlier.
- Shares of DIS and other media stocks already were thumped over the summer when DIS said its cable business - in which ESPN comprises ~75% of total revenue - would see operating income growth only in the “mid-single digits."
- Wells Fargo’s Marci Ryvicker estimates the subscriber loss has cost $700M in FY 2015 cable affiliate fee revenue and $200M in 2015 cable EBITDA, although she reiterates a Market Perform rating on the shares.
- Dow -0.21%.
- 10-yr +0.01%.
- Euro -0.3% vs. dollar.
- Crude -2.53% to $41.95.
- Gold -1.26% to $1,056.50.
- NextEra Energy's (NEE +0.2%) renewable energy unit agrees to sell its interest in two natural gas-fired power generation plants to a unit of Energy Future Holdings for $1.59B, including working capital.
- Energy Future has received approval from the bankruptcy court for the deal and the funding of it through its debtor-in-possession credit facility.
- NEE says its La Frontera Ventures unit will continue to operate the facilities in Texas for an initial period of up to one year.
- Dow -0.03% to 17,808.45. S&P +0.05% to 2,090.22. Nasdaq +0.16% to 5,124.15.
- Treasurys: 30-year -0.05%. 10-yr flat. 5-yr +0.05%.
- Commodities: Crude -2.09% to $42.16. Gold -0.42% to $1,053.50.
- Currencies: Euro -0.36% vs. dollar. Yen +0.12%. Pound +0.38%.
- Stock futures indicate a mixed open to start the shortened session, as investors cope with a big drop in Chinese stocks and look ahead to a heavy batch of U.S. economic data next week; Dow -0.1%, S&P flat, Nasdaq +0.2%.
- China's Shanghai Composite closed -5.5% after regulators opened an investigation into securities brokers, and the latest report on industrial profits showed a fifth straight monthly decline; elsewhere Japan's Nikkei closed -0.3%, U.K.'s FTSE currently trades -0.2%, and Germany's DAX is -0.3%.
- U.S. crude oil futures -2% at $42.17/bbl on the disappointing Chinese data and supply glut worries.
- U.S. Treasury prices are modestly higher, with the benchmark 10-year yield down 2 bps at 2.21%.
- Exact Sciences (NASDAQ:EXAS) reports that CMS's intended 2016 reimbursement for its colorectal cancer screening test Cologuard, just published on its website, is $501.26, higher than the advisory committee-recommended $492.72. Although good news, the company has asked for clarification on the reasons for the change. It will communicate it to investors when available.
- Previously: Exact Sciences closes up 6.8% after positive pricing ruling (Aug. 26)
- S&P +0.04%.
- 10-yr +0.02%.
- Euro -0.34% vs. dollar.
- Crude -1.86% to $42.24.
- Gold -1.73% to $1,051.60.
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- Toshiba (OTCPK:TOSYY) is considering selling part of its semiconductor business to raise financing in response to a drawn-out accounting scandal, WSJ reports.
- The company is weighing the sale of a stake in the chip arm via a stock-market listing or a transaction with another firm.
- Previously: Toshiba reveals $1.3B in impairment charges, further shaking investor trust (Nov. 13 2015)
- Hgihpower International (NASDAQ:HPJ) says it received a non-binding investment proposal from Anshan Co-Operation offering $101.7M in exchange for controlling interest in three subsidiaries.
- The proposal involves the purchase of newly issued shares of Shenzhen Highpower Technology Co., Springpower Technology Co. and Icon Energy System, the three subsidiaries in the People's Republic of China wholly-owned by HPJ.
- Monday is the FDA's PDUFA date for its review of Repros Therapeutics' (NASDAQ:RPRX) New Drug Application (NDA) for lead product candidate Androxal (enclomiphene citrate) for the treatment of men with low testosterone due to secondary hypogonadism, a condition caused by insufficient stimulation of the testes by the pituitary gland.
- The agency canceled November 3rd's Ad Comm meeting stating that outside expert advice was no longer needed, a good sign.
- Previously: PDUFA goal date is November 30 for Repros' enclomiphene citrate (April 15)
- Target (NYSE:TGT) reports a "successful" start to its Black Friday weekend, including "unprecedented" results on its website and a strong turnout in stores on Thanksgiving Day.
- TGT says top selling Black Friday items so far include Apple iPads, gaming consoles including Nintendo Wii U, TVs, Beats Solo 2 headphones... and stuffed teddy bears.
- TheStreet.com reports findings generally consistent with TGT's commentary, based on 10 visits to Target stores on Long Island yesterday, but that crowd sizes at TGT's openings were not quite as large as those seen at competitors J.C. Penney (NYSE:JCP) and Best Buy (NYSE:BBY).
- S&P +0.13%.
- 10-yr +0.04%.
- Euro -0.26% vs. dollar.
- Crude -1.71% to $42.33.
- Gold -0.54% to $1,063.90.
- Micro cap KaloBios (NASDAQ:KBIO) is up 80% premarket on increased volume. The stock rocketed from a low of $0.44 on November 16 to a high of $45.82 five days later after an investor group led by Martin Shkreli bought 70% of the outstanding shares. Shares retraced almost 60% to $18.40 before rallying again.
- Previously: Martin Shkrelli new chief of KaloBios; up to $13M in funding committed (Nov. 20)
- Previously: KaloBios -47% as it says it's shutting down (Nov. 13)
- Rio Tinto (NYSE:RIO) says it plans to spend $US1.9B (A$2.6B) on a redesigned expansion of a major bauxite project in Australia's Queensland state, confirming a project that has been expected for three straight years but deferred by the Rio board.
- Rio, already the world’s biggest supplier of bauxite into China, aims to capture an expected surge in demand by developing its Amrun project, the biggest investment approved by the company's board this year.
- Rio says Amrun, formerly known as South of Embley, would open in 2019 and initially churn out 22.8M metric tons/year of bauxite.
- Lannett (NYSE:LCI) finalizes its $1.23B acquisition of Kremers Urban Pharmaceuticals from Brussels, Belgium-based UCB S.A.
- The company expects to provide updated fiscal 2016 guidance in mid-December. The combined firm generated pro forma revenues of more than $800M for the 12-month period ending June 30, 2015.
- Previously: Lannett to buy Kremers Urban Pharmaceuticals for $1.23B; shares up 16% premarket (Sept. 2)
- Regenerative medicine firm Mesoblast (NASDAQ:MESO) announces that Japan's National Health Service has established reimbursement for its TEMCELL (MSC-100-IV) mesenchymal stem cell product for the treatment of acute graft versus host disease (aGVHD) after an allogeneic bone marrow transplant (BMT). Market launch will commence in February by licensee JCR Pharmaceuticals.
- The approved dosing regimen is eight doses of 2M cells/kg delivered as an IV infusion. For patients with persistent symptoms beyond four weeks, an additional 2M cells/kg may be administered each week for four more weeks.
- The reimbursement is 868,680 yen or $7,079 per bag of 72M cells. The average adult is expected to receive 16 to 24 bags so the total reimbursement will be about 13.9M to 20.8M yen or $113,000 to $170,000.
- According to the CDC, there are ~30K allogeneic BMTs performed each year worldwide, 8,900 in the U.S. Half will develop aGVHD.
- The company expects to complete enrollment in its U.S.-based 60-subject Phase 3 study assessing MSC-100-IV (remestemcel-L) in pediatric patients this quarter. Top-line results should be available in Q3 2016. If successful, a Biologics License Application (BLA) will be filed by the end of 2016.
- China plunged 5.5% overnight on probes of the country's two largest brokerages for securities violations. Hong Kong fell 1.9%, and the Nikkei 0.3%.
- Europe however is little-changed, and are U.S. stock index futures.
- The 10-year Treasury yield is down two basis points to 2.21%, gold is off $5 per ounce to $1,065, and oil is lower by $0.95 per barrel to $42.09.
- ETFs: SPY, QQQ, DIA, SH, SSO, SDS, VOO, IVV, UPRO, PSQ, SPXU, TQQQ, SPXL, RSP, SPXS, QID, SQQQ, QLD, DOG, DXD, RWL, UDOW, EPS, SDOW, DDM, VFINX, BXUB, QQEW, QQQE, SPLX, SFLA, BXUC, QQXT, SPUU, LLSP, UDPIX, OTPIX, RYARX
- German pilots union Vereinigung Cockpit is confident it can come to a deal that will allow it to take part in a round table discussions organized by Lufthansa (OTCQX:DLAKY) management to defuse tensions over job and growth prospects.
- Lufthansa asked unions representing the pilots, cabin crew and ground staff to the meeting on Dec. 2 but the pilots' union initially said it was unlikely to take part in the talks because of legal concerns.
- "Since then, management has approached us to overcome these legal hurdles," VC said in an internal document seen by Reuters.
- Related: Lufthansa cabin crew union calls off strike (Nov. 25 2015)
- Related: Lufthansa hopes to resume operations after longest-ever strike (Nov. 13 2015)
- S&P +0.08%.
- 10-yr +0.04%.
- Euro -0.27% vs. dollar.
- Crude -2.15% to $42.11.
- Gold -0.54% to $1,064.20.
- Toyota (NYSE:TM) outsold Volkswagen (OTCQX:VLKAY) for the fourth straight month in October to remain the world's top-selling automaker after sales at the German company slumped following its diesel emissions scandal.
- Toyota's group vehicle sales totaled 8.35M from January to October, more than the 8.26M vehicles delivered by Volkswagen during the same period. Toyota has now continuously outsold its arch-rival on a year-to-date basis since July.
- Japan -0.30%.
- Hong Kong -1.87%.
- China -5.48%.
- India +0.65%.
- London -0.09%.
- Paris +0.13%.
- Frankfurt +0.24%.
- Gold is hovering close to its lowest level in nearly six years, weakened by strength in the dollar, expectations of a U.S. rate hike next month and news of lower gold imports into China.
- If the decline holds, the yellow metal will record its sixth consecutive week of losses, the longest such streak since August.
- Bullion for immediate delivery -0.6% at $1,063.30.
- ETFs: GLD, IAU, PHYS, SGOL, UGL, DGP, GTU, GLL, UGLD, DZZ, GLDI, OUNZ, DGL, DGZ, DGLD, GEUR, UBG, GYEN, QGLDX
- Brazilian President Dilma Rousseff's austerity program is in trouble again and she may face new calls for an impeachment after her point man in the Senate was arrested in a widening corruption scandal.
- "The arrest felt like a nuclear bomb here in the presidential palace," said a Rousseff aide.
- Delcidio do Amaral is the ruling Workers' Party's most senior figure in Congress, and is charged for allegedly trying to bribe Petrobras' (NYSE:PBR) former international director, Nestor Cervero.
- ETFs: EWZ, BRF, BRZU, EWZS, BRXX, BRAQ, BZQ, BRAZ, BRAF, UBR, DBBR, FBZ
- BHP Billiton (NYSE:BHP) shares came under fresh pressure on Friday over its recent dam collapse in Brazil after the UN said the mine waste released in the accident contained toxic chemicals and efforts to protect people were "clearly insufficient."
- Twelve people died and many more went missing following the dam burst, which sent millions of tons of mine waste cascading through villages and into Brazil's river system.
- BHP -3.4% premarket
- The shaky condition of U.S. retail will be put to the test this weekend, when stores across the country roll out their Black Friday specials.
- About 135.8M Americans are expected to shop in stores or online over the four-day weekend, according to the National Retail Federation, but the amount they've spent has declined over the past two years, dropping 11% to $50.9B in 2014.
- The forecast for frugal shopping also got a boost on Wednesday, when Commerce Department figures showed household spending rose less than expected in October.
- ETFs: XLP, XLY, VDC, XRT, VCR, RTH, PBJ, RETL, PEJ, IYK, FXG, IYC, SCC, FXD, RHS, UCC, PMR, UGE, RCD, PSL, PSCC, SZK, FDIS, FSTA, PSCD, PEZ
- The World Trade Organization remains deeply divided over its flagship global trade pact ahead of a key conference in Nairobi next month, with some members suggesting negotiations should start from scratch.
- The Doha round of talks aimed at liberalizing trade has faced endless obstacles since the process began in 2001.
- Biggest potential winners from the WTO's 161 member-states would be the world's poorest countries, most of whom are excluded from regional trade talks going on elsewhere, such as the Trans-Pacific Partnership.
- Two engineers have been suspended at Volkswagen's luxury arm Audi (OTCPK:AUDVF) after its larger diesel engines were found evading emissions limits in the United States.
- The news widens a scandal at parent VW which has led to the ouster of its long-time chief executive and wiped more than €20B ($21B) off the group's market value.
- French President Francois Hollande met Russian President Vladimir Putin in Moscow yesterday and agreed to cooperate in the fight against ISIS, although the two remained at odds over the fate of Syrian President Bashar al-Assad.
- The news comes after Russia targeted Turkey's economy with a range of sanctions - such as checks on Turkish food imports and cutting military/tourism ties - three days after Turkey shot down a Russian warplane on its border with Syria.
- However, some sanctions are still up for discussion, including closing Russian airspace and ports to Turkish companies, suspending investment agreements/joint projects, and barring cultural exchanges.
- ETFs: RSX, TUR, RUSL, RUSS, ERUS, RSXJ, RBL, TKF
- Japan's Prime Minister Shinzo Abe has ordered Cabinet ministers to prepare an extra spending package (likely over ¥3T), including cash handouts for the poorest pensioners, to boost the country's stalling recovery.
- The measures reflect a new focus for Abenomics, which has been criticized for benefiting mostly big businesses instead of the average Japanese.
- Data for October released Friday: Japan's jobless rate fell to a 20-year low of 3.1%, but household spending fell 2.4% and average incomes fell 0.9%.
- Nikkei -0.3% to 19,884.
- ETFs: DXJ, EWJ, DFJ, DBJP, NKY, JOF, EZJ, JEQ, JPNL, DXJS, EWV, SCJ, HEWJ, JSC, JPXN, JPP, QJPN, FJP, JPMV, DXJT, DXJC, DXJR, DXJH, JHDG, DXJF, HEGJ, JDG, JPN, FXJP, HGJP
- A multi-state E. coli outbreak that has sickened at least 19 people who ate rotisserie chicken salad sold at Costco (NASDAQ:COST) has been traced to a celery-and-onion mix used in the salad.
- According to the Centers for Disease Control and Prevention, the number of people affected by the outbreak could grow over the next few weeks (even though the product has been removed from store shelves), since the the spread of the foodborne illness takes some time to track.
- Previously: More people seen affected by Costco E.coli outbreak (Nov. 26 2015)
- Chinese stocks dove sharply in the afternoon trading session today after authorities disclosed investigations into several major brokerages over suspected trading violations.
- The probes into Citic, Guosen, Founder and Haitong Securities followed additional souring market sentiment on Friday that revealed lackluster Chinese industrial data in October.
- The Shanghai Composite Index fell 5.5% to 3,436.30, wiping out most of its gains this month and recording its biggest one day fall since Aug. 25.
- ETFs: FXI, ASHR, EWH, CAF, YINN, KWEB, PGJ, GXC, FXP, HAO, YANG, TAO, CHIX, CHN, PEK, CHIQ, CQQQ, MCHI, TDF, QQQC, XPP, YAO, GCH, ASHS, YXI, CN, CXSE, FCA, CNXT, CHNA, CHII, CHIE, ECNS, EWHS, CHIM, KBA, KFYP, FCHI, JFC, FHK, AFTY, XINA, CHAD, ASHX, CHAU
- Just days before the start of the UN climate talks in Paris, Unilever (NYSE:UL) has announced a fresh wave of environmental commitments in a bid to ensure it becomes "carbon positive" by 2030.
- The company said it would stop using energy from coal by 2020 and will seek to support renewable energy generation, so by 2030 it can make a surplus available to markets and communities where it operates.
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