- This is why the locals are furious at the US: U.S-led raids hit grain silos in Syria, kill workers (Reuters) explaining this
- Billions Fly Out the Door at Pimco: About $10 Billion Is Withdrawn After Departure of Gross (WSJ)
- Pimco’s Ivascyn Takes on Gross With Unconstrained Fund (BBG)
- Revealed – the Troika threats to bankrupt Ireland (The Independent)
- Private Bad Debt Build-Up Casts Shadow on Greek Rebound (BBG)
- Fed Questions Bank Maneuver to Reduce Hedge Funds’ Dividend Taxes (WSJ)
- Yuan-Euro Direct Trading Begins Tomorrow as China Promotes Usage (BBG)
- Geneva Report warns record debt and slow growth point to crisis (FT)
- Greenberg Team to Grill Bernanke, Geithner on AIG Bailout (BBG)… sadly only metaphorically
- Draghi Devaluing Euro Cheers ECB as Inflation Seen Fading (BBG)
- EU to Publish Details of Probes of Tax Deals Benefiting Apple, Fiat (WSJ)
- UBS does what it does best. rat: Swiss bank UBS says it has started FX settlement talks (Reuters)
- Iran builds surface-to-surface missile (AP)
- More hookers, more blow: Sex and drugs boost UK economy (Telegraph)
- Phoning ‘home’: what your mobile may be giving away (Reuters)
Overnight Media Digest
WSJ
* Pimco suffered roughly $10 billion of withdrawals following the Friday departure of co-founder Bill Gross, a sign of how quickly Gross’s surprise move is reshaping the bond-investing landscape. (http://on.wsj.com/1vmHXnE)
* Large banks generate more than $1 billion a year in revenue by helping hedge funds and other clients reduce taxes through a complicated trading strategy that has drawn criticism from U.S. authorities. Known as “dividend arbitrage,” the strategy is run largely from London, where the banks temporarily transfer ownership of a client’s shares to a lower-tax jurisdiction around the time when the client expects to collect a dividend on those shares. (http://on.wsj.com/1uVARnQ)
* Maurice “Hank” Greenberg is challenging the government’s crisis-era bailout of American International Group, the company he built into a global financial-services powerhouse. (http://on.wsj.com/1rwxyVf)
* Marvel Entertainment LLC has settled a lawsuit bound for the Supreme Court that pitted the comic-book company against the family of the artist who helped create superheroes such as Spider-Man, Iron Man and the Incredible Hulk. (http://on.wsj.com/1mETzAT)
* Microsoft Corp’s first Manhattan flagship store is coming to Fifth Avenue. The software company confirmed that it will be setting up shop at 677 Fifth Ave. as it continues to expand its retail presence and take more control over its consumers’ shopping experience. The Fifth Avenue store has been five years in the making, Microsoft executives said. (http://on.wsj.com/1plh0L8)
* SoftBank Corp is in talks to buy or otherwise link up with DreamWorks Animation SKG Inc, people familiar with the negotiations said, a deal that could help the Japanese company and the Hollywood studio as they seek new ways to compete with rivals world-wide. (http://on.wsj.com/1mF34jn)
FT
* The European Commission will accuse Apple Inc of benefiting from illicit state aid in Ireland, based on preliminary findings of an investigation into tax deals.
* Air France-KLM pilots called off on Sunday a two-week strike that had cost the airline more than 250 million euros($317.18 million).
* Sophie Turner Laing, former managing director of content at BSkyB, is to head the world’s largest independent TV production group, formed by the three-way merger of Endemol, Shine and Core Media.
* The London Stock Exchange Group Plc is attempting to increase the number of listings of African companies in the UK, which follows strong interest coming from institutional investors from the region.
* British entrepreneur Hugh Osmond has acquired restaurant chain Strada from Tragus Group through his investment vehicle Sun Capital in a 37 million pounds deal.
NYT
* Tobacco companies are putting out among the strongest health warnings in the fledgling e-cigarette industry, going further even than the familiar ones on actual cigarettes, a leading cause of death. It has left the industry’s critics scratching their heads and deeply skeptical. (http://nyti.ms/ZjEBpI)
* The United States Department of Agriculture plans to announce Monday that it will spend $52 million to support local and regional food systems like farmers’ markets and food hubs and to spur research on organic farming. (http://nyti.ms/1rwtFj6)
* Facebook Inc plans to roll out a rebuilt ad platform, called Atlas, on Monday that will allow marketers to tap its detailed knowledge of its users to direct ads to those people on thousands of other websites and mobile apps. (http://nyti.ms/ZjCCBM)
* A third Allergan Inc’s shareholder, Jackson Square Partners has come forward to insist that the Botox maker not agree to an all-cash acquisition that would thwart a takeover offer before a special meeting scheduled for Dec. 18. (http://nyti.ms/1Czp1EA)
* A group of New York hedge funds that sued Argentina is now asking a New York court to lower the temperature a little on the long-running and acrimonious dispute. The group, led by Paul Singer’s NML Capital, appealed on Friday to Judge Thomas Griesa of the Federal District Court in Manhattan to allow Citigroup Inc to make a $5 million payment to bondholders by a Tuesday deadline. (http://nyti.ms/1plit4a)
* Hundreds of other writer, who publicly protested Amazon.com Inc’s actions, now want the Justice Department to investigate Amazon for illegal monopoly tactics. (http://nyti.ms/1ywgvYn)
* An audience measurement system being introduced on Monday will allow individual magazines to capture broad consumer engagement for the first time, whether it is a fan watching a Cosmopolitan fashion video on a mobile phone or a reader looking at a favorite new recipe from Bon Appétit on Pinterest. (http://nyti.ms/1mFdjV8)
Canada
THE GLOBE AND MAIL ** Canadian opposition MPs are expressing concerns about the government’s handling of Canada’s deepening role in the war against Islamic State militants as Prime Minister Stephen Harper appe
ars ready to seek parliamentary approval to once again send the country into a Middle East conflict. (bit.ly/1taQ2r9)
** Promising a “fresh start” for Ontario’s Progressive Conservatives party after four election losses, Barrie MP Patrick Brown is making his leadership bid official. Brown has been steadily building his bid in recent months, with a formal launch in his riding on Sunday. (bit.ly/1plDHz3)
** Canada’s big tobacco companies are accusing the plaintiffs in a Quebec lawsuit of attempting to use the courts to do what Parliament doesn’t dare: ban the sale of cigarettes. (bit.ly/1mFTxIV)
NATIONAL POST
** Canadian taxpayers will likely be on the hook for millions of dollars to keep the country’s aged CF18 fighter jets flying into the next decade because of delays in finding a replacement aircraft, secret documents show. (bit.ly/1vpaG9q)
** A week after the Scottish referendum, German President Joachim Gauck has created a minor stir in Quebec by remarking that he is happy Quebec never separated from Canada. Gauck underlined the importance of Quebec in a united Canada in a speech on Saturday in Quebec City. (bit.ly/1vpbviD)
** Canadian warehouse retailer XS Cargo Co began its final liquidation sale over the weekend and will close its 50 stores in eight provinces across Canada after making a failed bid to restructure this summer. (bit.ly/1nxYWTh)
China
PEOPLE’S DAILY
– The ruling Communist Party of China and the State Council, the cabinet, in a joint decree banned party and government officials from holding meetings at scenic spots in the latest official move to crack down on corruption.
CHINA SECURITIES JOURNAL
– The government is likely to step up its targeted monetary easing in the fourth quarter of this year after it posted a slew of weak economic data of late, analysts say.
SHANGHAI SECURITIES NEWS
– Preparations have been completed for the launch of the Shanghai-Hong Kong connect, which will allow investors in the two cities to invest in each other’s stock market, after the Shanghai Stock Exchange conducted the third round of tests in its computer system designed for the programme over the weekend.
CHINA BUSINESS NEWS
– The value of assets managed by 100-plus Chinese brokerages is expected to exceed 10 trillion yuan ($1.6 trillion) next year after it jumped to more than 7 trillion yuan around the end of July from 5 trillion yuan by the end of last year, thanks to the government’s efforts to encourage innovations by securities houses.
CHINA DAILY
– Participants at the ongoing Beijing-Tokyo Forum have called upon media professionals in China and Japan to provide a more balanced and objective view of each other’s country to help prevent Sino-Japanese relations from deteriorating further.
– Yuan activities are accelerated across European financial centres, including London, Paris and Luxembourg, signalling a big step forward in the internationalisation of the Chinese currency and Europe’s crucial role in supporting the process.
SHANGHAI DAILY
– U.S. lingerie brand Victoria’s Secret, owned by L Brands Inc, has won 500,000 yuan and a public apology from a Chinese investment management firm that used its trademark at a store and at lingerie shows, a Shanghai court ruled.
Britain
The Times
** British Prime Minister David Cameron suffered a double hammer blow last night as he lost a second MP to Ukip and a minister to a sex scandal on the eve of the Conservative party conference. In a move that pitched the prime minister’s European policy into turmoil, Mark Reckless defected to Nigel Farage’s party and immediately called a by-election, accusing Cameron of “letting the country down”. (thetim.es/1qLfMse)
** General Lord Richards, former head of the UK military warned this weekend that ISIS, also known as Islamic State, will never be defeated by air attacks alone and western governments are wrong to rule out deploying their own ground troops. (thetim.es/1yvWHo7)
The Guardian
** Air strikes continued to target Islamic State positions near the Kurdish town of Kobani and hubs across north-east Syria on Sunday, as the terror group moved towards a new alliance with Syria’s largest al-Qaida group that could help offset the threat from the air. (bit.ly/1DOd9js)
** Hong Kong police fired teargas grenades and launched baton charges as tens of thousands of protesters flooded the streets around the government complex in Admiralty – a bustling commercial area in downtown Hong Kong – leading authorities to divert bus routes and shut down a subway station late on Sunday. (bit.ly/1vozGh5)
The Telegraph
** The investigation into a 250 million pound black hole in Tesco’s profits is centring on the culture of the retailer, with concerns that managers may have been pressurised into using improper practices. A source said there were fears there had been a “corruption of virtues” among staff and that the key to the investigation was establishing “what led people to do these things” and “why people didn’t say things earlier.” (bit.ly/1vo0UV9)
** Crossrail, the high-speed train service that will stretch across central London, is already adding value to homes along its route, even though it is not due to open for business for four years. Europe’s largest infrastructure project has driven house prices up by 96 pct over the past decade, according to a study by the online estate agent eMoov, which also estimated that the average price of property near the route would rise another 36 pct by 2020. (bit.ly/1pkS9Hq)
Sky News
** A monster truck crashed into a crowd in the Netherlands, killing two adults and a child and wounding a dozen more. The vehicle had been attempting a stunt during a car show in the eastern city of Haaksbergen. (bit.ly/1vozT3U)
** Defence Secretary Michael Fallon has rejected claims Britain’s role in the fight against Islamic State is a “token” gesture, as he confirmed RAF Tornados are now flying daily over northern Iraq. He told Sky’s Murnaghan programme the United States welcomes the contribution of six aircraft to the mission. (bit.ly/1rt0MD7)
The Independent
** Belgrade was placed under lockdown on Saturday night as Serbia’s first Gay Pride march in four years took place under the watchful eye of tanks and special forces. (ind.pn/1pl6zHr)
** Mark Reckless, the ex-Conservative MP that defected to Ukip on Saturday, looked to have cancelled a planned walkabout to celebrate his move with leader Nigel Farage after a negative reaction in his Rochester constituency. (ind.pn/YzALrj)
Fly On The Wall Pre-Market Buzz
ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
Personal income for August at 8:30–consensus up 0.3%
Personal spending for August at 8:30–consensus up 0.4%
Pending home sales index for August at 10:00–consensus down 0.5%
ANALYST RESEARCH
Upgrades
Akorn (AKRX) upgraded to Outperform from Sector Perform at RBC Capital
Baidu (BIDU) upgraded to Buy from Neutral at UBS
Chico’s FAS (CHS) upgraded to Outperform from Perform at Oppenheimer
Energy Transfer Partners (ETP) upgraded to Overweight at Morgan Stanley
FedEx (FDX) upgraded to Outperform from Market Perform at Cowen
Janus Capital (JNS) upgraded to Equal Weight from Underweight at Morgan Stanley
LRR Energy (LRE) upgraded to Buy from Hold at Stifel
Nationstar (NSM) upgraded to Buy from Neutral at Sterne Agee
Nike (NKE) upgraded to Outperform from Neutral at Credit Suisse
Pearson (PSO) upgraded to Outperform from Underperform at Macquarie
Philips (PHG) upgraded to Buy from Hold at ING Group
Rent-A-Center (RCII) upgraded to Buy from Hold at KeyBanc
Sonic Automotive (SAH) upgraded to Overweight from Equal Weight at Morgan Stanle
y
Universal Health (UHS) upgraded to Outperform from Market Perform at BMO Capital
Voya Financial (VOYA) upgraded to Strong Buy from Outperform at Raymond James
Downgrades
Avery Dennison (AVY) downgraded to Neutral from Overweight at JPMorgan
EV Energy (EVEP) downgraded to Hold from Buy at Stifel
F5 Networks (FFIV) downgraded to Neutral from Outperform at RW Baird
KapStone (KS) downgraded to Hold from Buy at KeyBanc
QR Energy (QRE) downgraded to Hold from Buy at Stifel
Initiations
L’Oreal (LRLCY) initiated with a Market Perform at Wells Fargo
McKesson (MCK) initiated with an Overweight at Barclays
NTT DoCoMo (DCM) initiated with an Underweight at JPMorgan
COMPANY NEWS
Encana (ECA) said it will acquire Athlon Energy (ATHL) for $58.50 per share or $5.93B
Lenovo (LNVGY) to close acquisition of IBM’s (IBM) x86 server business on October 1
Standard Chartered Hong Kong (SCBFF) temporarily suspended certain branches until further notice
Daiichi Sankyo to acquire Ambit Biosciences (AMBI) in a transaction valued up to $410M
Allergan (AGN) holder Jackson Square Partners against large acquisition (VRX, ACT, SLXP)
NiSource (NI) announced plans to separate into two publicly traded companies
EARNINGS
Companies that beat consensus earnings expectations last night and today include:
Applied Genetic (AGTC)
Companies that missed consensus earnings expectations include:
Cal-Maine Foods (CALM), Cesca Therapeutics (KOOL)
NEWSPAPERS/WEBSITES
EU to accuse Apple (AAPL) of illegal Irish tax dealings, FT reports
Softbank (SFTBF) in talks to acquire DreamWorks Animation (DWA), Hollywood Reporter says
Citigroup (C), JPMorgan (JPM) meet with FCA to settle forex rigging probe, WSJ reports (BCS, HSBC, UBS, RBS)
Microsoft’s (MSFT) CEO vows to fully cooperate in China’s antitrust probe, Reuters says
Demand for Apple’s (AAPL) iPhones waning in China, NY Times reports
Amazon.com (AMZN) to launch grocery delivery in NYC, Re/code reports
Royal Dutch Shell (RDS.A), BP (BP) in running for Abu Dhabi oil deal, Telegraph says
JetBlue (JBLU) shares could jump 50% in about a year, Barron’s says
Constellation Brands (STZ) looks expensive, Barron’s says
Allianz (AZSEY) to suffer from PIMCO outflows, Barron’s says (JNS)
SYNDICATE
ConAgra (CAG) files automatic mixed securities shelf
Covenant Transportation (CVTI) files $100M mixed securities shelf
El Paso Electric (EE) files automatic mixed securities shelf
Retail Opportunity Investments (ROIC) files to sell 3.13M shares for holders
Sabra Health Care (SBRA) files to sell 6M shares of common stock
via Zero Hedge http://ift.tt/1taW7DR Tyler Durden