- Unstoppable $100 Trillion Bond Market Renders Models Useless (BBG)
- Afghan president fumes at prisoner deal made behind his back (Reuters)
- Spain to Unveil $8.6 Billion Stimulus Package (AP)
- Obama to Urge European Allies to Stay Tough on Russia (WSJ)
- How fracking helps America beat German industry (Reuters)
- Frenchman ‘admits’ Brussels shooting in video (AFP)
- Heloc Payment Jump to Take Bite Out of Consumer Spending (WSJ)
- Obama Said to Propose Deep Cuts to Power-Plant Emissions (BBG)
- Lehman Lesson Lost as Bank Lobby Gains Clout (BBG)
- WSJ reports that WSJ reporting on Icahn insider trading probe may have killed it (WSJ)
- U.S. would face hurdles bringing case against Icahn, Mickelson (Reuters)
- For World Cup, Betting Flows Through Banker-Turned-Bookie (BBG)
- KKR liquidates former Goldman Sachs traders-run hedge fund (Reuters)
- McDonald’s murder in China sparks outrage (Reuters)
- Investors Rewarded for Trek Into Little Known Markets (WSJ)
- Thai oil tanker recovered, cargo taken by hijackers (Reuters)
- Google Invests in Satellites to Spread Internet Access (WSJ)
- U.K. Mortgage Approvals Drop as Housing Boom Cools (BBG)
Overnight Media Digest
WSJ
* The Environmental Protection Agency will propose a draft rule on Monday seeking a 30 percent reduction in carbon dioxide emissions by 2030 from existing power plants based on emission levels from 2005, according to two people who have been briefed on the rule. (http://ift.tt/1pLEkTS)
* News of the insider-trading probe of investor Carl Icahn, golfer Phil Mickelson and sports bettor William “Billy” Walters has derailed government efforts to secretly deploy wiretaps, which have been key components of many successful insider-trading cases. Criminal and civil investigators are examining whether Icahn tipped Walters about his plans relating to stocks of several companies, including Clorox Co, according to people briefed on the probe. (http://ift.tt/1pLEieP)
* Hillshire Brands Co Chief Executive Sean Connolly is weighing escalating bids from two of the world’s biggest meat companies Tyson Foods Inc and Pilgrim’s Pride Corp , a unit of Brazilian meat giant JBS SA. Tyson’s $6.1 billion offer – topping Pilgrim’s offer of $5.5 billion – values the Chicago-based company at 35 percent above its share price before the bids. (http://ift.tt/1wTbRQQ)
* On Friday Time Inc will become a stand-alone public company as its spinoff from Time Warner Inc is completed. It is going out on its own at a brutal time for print media, as advertisers have shifted spending to online media. Time Inc’s ad revenue fell 6 percent between 2011 and 2013, while circulation revenue fell 11 percent, bringing total revenue down 8.8 percent to $3.35 billion. (http://ift.tt/1pLEkTX)
* Google Inc plans to spend more than $1 billion on a fleet of satellites to extend Internet access to unwired regions of the globe, people familiar with the project said. Details remain in flux, but the project will start with 180 small, high-capacity satellites orbiting the earth at lower altitudes than traditional satellites. (http://ift.tt/1pLEieT)
* Apple will announce iBeacon plans, its latest product to carry the ‘i’ prefix, at the Worldwide Developers Conference in San Francisco. Apple’s iBeacon allows apps to locate a user within a few inches, so that a phone can direct a driver to the nearest open spot in a parking garage or the shortest hot-dog line in a crowded stadium. (http://ift.tt/1wTbPIT)
* Online music-streaming companies like Sweden’s Spotify AB and France’s Deezer Inc said in interviews they remain committed to investing for growth instead of pursuing immediate profits, an indication they have no plans to change course after Apple’s blockbuster acquisition of Beats. (http://ift.tt/1wTbPZ9)
* Forstmann Little & Co sold 24 Hour Fitness Worldwide Inc on Friday to a group of investors, the last step in the more than two-year process of winding down the pioneering buyout firm. A small group of Forstmann Little employees and a Washington, DC, lawyer have been selling the firm’s holdings since the November 2011 death of co-founder Theodore Forstmann. (http://ift.tt/1wTbRR0)
* The Federal Trade Commission on Friday granted antitrust clearance to the planned tie-up of suit sellers Men’s Wearhouse Inc and Jos. A. Bank Clothiers Inc, saying the deal is unlikely to harm consumers. (http://ift.tt/1pLEkU1)
* The U.S. has grown more attractive as a destination for foreign investment, while Russia and some other emerging markets have faded, according to a survey by A.T. Kearney, a Chicago-based management-consulting firm. (http://ift.tt/1pLEivf)
* The debate over who deserves to profit from work that originated at a law firm that collapsed comes to a head on Wednesday when New York’s highest court will hear arguments in cases stemming from the bankruptcies of Coudert Brothers LLP, which went under in 2005, and Thelen LLP, which closed in 2008. (http://ift.tt/1wTbPZf)
FT
GlaxoSmithKline Plc has agreed a deal worth more than $350 million with UK biotech company Adaptimmune to develop cancer drugs.
The owners of German firm Rocket Internet aim to list the venture capital company behind online brands such as retailer Zalando for a market valuation of up to 5 billion euros ($6.82 billion), and have hired banks Berenberg, Morgan Stanley and JPMorgan to review a potential listing on the Frankfurt exchange.
The world’s largest hotel operator Hilton Worldwide is aiming to launch upscale boutique hotels in the United States and Europe in an attempt to beat competition, and is expected to make an announcement on Monday.
An investment of 750 million pounds ($1.26 billion) in the upgrade of its Plant Oxford has led to the BMW Group’s Mini building unit to have most advanced car production techniques with robotic workers.
Lastminute.com’s Brent Hoberman is to return to the stock market after a nine-year absence with the flotation of Made.com. Hoberman, the chairman of the online furniture retailer, has hired a trio of banks to bring it to the public market.
NYT
* Voices inside and outside Scotland warn of the implications of independence, even as its supporters say Scotland would be better off by itself. (http://ift.tt/1pLEkU3)
* The Obama administration on Monday will announce one of the strongest actions ever taken by the United States government to fight climate change, a proposed Environmental Protection Agency regulation to cut carbon pollution from the nation’s power plants 30 percent from 2005 levels by 2030. The regulation takes aim at the largest source of carbon pollution in the United States, the nation’s more than 600 coal-fired power plants. (http://ift.tt/1pLEivj)
* The revelation that Carl Icahn has become a focus of an insider trading investigation into trades made by the golfer Phil Mickelson and a prominent Las Vegas gambler threatens to leave a mark on a record that Icahn has called “unblemished” and his rivals have called enviable. (http://ift.tt/1wTbPZh)
* As the first chief executive of a major publishing house to negotiate new terms with Amazon.com Inc since the Justice Department sued five publishers in 2012 for conspiring to raise e-book prices, Michael Pietsch, chief executive of the Hachette Book Group, finds himself fighting not just for the future of Hachette, but for that of every publisher that works with Amazon. (http://ift.tt/1pLEivl)
* “Fireman Sam,” a cartoon aimed at preschoolers, has long been a hit overseas. Now Mattel Inc and Amazon.com Inc are teaming up to sell the yellow-hatted hero to American children – a potentially controversial experiment that, if successful, could create a new model for marrying television shows with related merchandise. (http://ift.tt/1pLElah)
* Lewis Katz, an owner of The Philadelphia Inquirer, died along with six other people when a private jet erupted into a ball of fire as it took off outside Boston. (http://ift.tt/1wTbQfJ)
* Along with operating system updates for mobile and desktop machines, Apple Inc plans to introduce a new health-tracking app at its annual developers’ conference on Monday, according to a person briefed on the product. The app for mobile devices will track statistics for health or fitness, like a user’s footsteps, heart rate and sleep activity. The health app will most likely be able to connect with a smart watch that Apple is widely expected to release this year. (http://ift.tt/1pLEivn)
* After more than five months of negotiations, Etihad Airways of Abu Dhabi confirmed on Sunday that it was nearing an agreement that could lead to a sizable investment in Alitalia . In a joint statement, the airlines said Etihad would formally submit a letter to Alitalia’s board in the coming days detailing the conditions of a nonbinding offer for a stake of up to 49 percent of the money-losing Italian airline. (http://ift.tt/1pLEivp)
Canada
THE GLOBE AND MAIL
* Quebec Finance Minister Carlos Leitao will unveil on Wednesday what he calls a “transition budget” that will provide a foretaste of the nasty medicine the province needs to swallow to balance its books by 2015-16. (http://ift.tt/1pLEiLD)
* Thousands of commuters in the Greater Toronto Area can breathe a huge sigh of relief. A strike that threatened to shut down GO Transit bus service has been averted after a tentative contract agreement was reached between Metrolinx and Amalgamated Transit Union Local 1587. (http://ift.tt/1wTbSnT)
Reports in the business section:
* Pay for Canada’s top executives is on the rise as companies put years of economic downturn firmly behind them. Canadian chief executives saw their total compensation climb by 11 percent in 2013, which marks the fourth straight year of pay gains after a decrease and plateau in 2008 and 2009. (http://ift.tt/1pLElal)
NATIONAL POST
* The sparring between Ontario’s three main political camps continued on Sunday, with the Liberals accusing Tim Hudak of adopting the policies of “right-wing extremists” and the Progressive Conservatives demanding Kathleen Wynne “come clean” on the MaRS controversy. The Progressive Conservative party urged Liberal leader Wynne to release all the documents relating to the apparent bailout of the MaRS innovation and research complex in Toronto. (http://ift.tt/1wTbSo0)
* One week before the Boko Haram terrorist kidnapping in which nearly 300 students were taken from a girls school in northern Nigeria, a similar incident across the border in Cameroon saw an elderly Canadian missionary nun taken hostage with two Italian priests. News broke on Sunday that Sister Gilberte Bussiere, 74, has been freed after nearly two month’s captivity along with Father Gianantonio Allegri and Father Giampaolo Marta, both of Vicenza in the northeast of Italy. (http://ift.tt/1wTbSo2)
FINANCIAL POST
* Whether it’s an iPhone or an Android, smartphones are ubiquitous these days and basic cellphones with just texting and calling capabilities are a dying breed. However, there is still demand for basic cell phones with simple voice calls in emerging markets and among frugal consumers in developed markets such as Canada that have little or no need for data on their cellphones. (http://ift.tt/1pLElap)
* The mood of small business operators in Canada has taken a decidedly positive turn. In fact, their optimism is at the highest point in more than two years – and just shy of levels consistent with steady economic growth, according to the most recent survey. (http://ift.tt/1wTbQwb)
Britain
The Telegraph
SEARCH FOR SHALE GAS HEADS EAST AS IGAS PLANS FRACKING IN EAST MIDLANDS
Andrew Austin, IGas Energy Plc chief executive, told the Telegraph it was preparing to submit planning applications to drill and frack to test the flow of gas at two new locations, one either side of the Pennines.
LDC ENTERS INTO EXCLUSIVE TALKS FOR MINI AUTODATA
The private equity arm of Lloyds Banking Group has entered into exclusive talks to acquire car data firm Clifford Thames in a deal that could value the business at up to 50 million pounds.
The Guardian
UK EMPLOYERS EXPECT TO HIRE ’18 PCT MORE GRADUATES IN 2014′
Employers expect to hire 18 percent more graduates in 2014, up from the modest improvement of 4.3 percent in 2013 – with the finance sector planning to be the most aggressive recruiter as it increases intake by 42 percent.
ENERGY UK: TIME TO RETHINK ‘GREEN’ POWER POLICIES IN BRUSSELS
Energy UK will on Monday use electoral successes made by Eurosceptics to call for a rethink on “green” power policies in Brussels. The lobby group headed by former Conservative MP Angela Knight says it is time to move away from “an emotion driven and expensive agenda.”
The Times
SHIRE SECURES $5 BLN FUNDING FOR US BID
Shire has lined up a $5 billion credit facility from banks led by Citigroup to finance a takeover offer for NPS Pharmaceuticals, an American developer of a new drug for sufferers of a debilitating bowel condition.
BAE SAYS SCOTTISH INDEPENDENCE WILL “DAMAGE STABILITY”
The boss of Britain’s biggest defence group BAE Systems Plc has become the latest business figure to speak out against Scottish independence after declaring that a “yes” vote would damage the “certainty and stability” necessary for investment.
Sky News
WORKPLACE PENSIONS SHAKE-UP ‘COULD BOOST FUNDS’
Radical changes to workplace pensions are set to be unveiled in the Queen’s Speech this week, with supporters claiming the shake-up could boost retirement incomes by thousands of pounds.
GOVT ACCUSED OF ‘HYPING UP’ FRACKING HOPES
Shadow energy and climate change secretary Caroline Flint told Sky’s Murnaghan programme gas was an “important part of our energy mix” but “more stringent benchmark testing” a year before drilling starts was needed.
Fly On The Wall 7:00 AM Market Snapshot
ECONOMIC REPORTS
Domestic economic reports scheduled today include:
ISM manufacturing index for May at 10:00–consensus 55.5
Construction spending for April at 10:00–consensus up 0.7% for the month
ANALYST RESEARCH
Upgrades
Advantage Oil & Gas (AAV) upgraded to Outperform from Sector Perform at RBC Capital
Alcoa (AA) upgraded to Neutral from Underperform at BofA/Merrill
Century Aluminum (CENX) upgraded to Neutral from Underperform at BofA/Merrill
Consolidated Water (CWCO) upgraded to Buy from Hold at Brean Capital
Diamondback Energy (FANG) upgraded to Buy from Neutral at SunTrust
Magnum Hunter (MHR) upgraded to Buy from Hold at Stifel
Microsemi (MSCC) upgraded to Buy from Neutral at Goldman
NorthWestern (NWE) upgraded to Buy from Hold at KeyBanc
Synovus (SNV) upgraded to Outperform from Market Perform at Raymond James
TripAdvisor (TRIP) upgraded to Outperform from Sector Perform at Pacific Crest
Downgrades
BNP Paribas (BNPQY) downgraded to Neutral from Conviction Buy at Goldman
Big Lots (BIG) downgraded to Equalweight from Overweight at Barclays
Express Scripts (ESRX) downgraded to Market Perform from Outperform at Cowen
Infineon (IFNNY) downgraded to Neutral from Buy at Citigroup
Microchip Technology (MCHP) downgraded to Neutral from Buy at Goldman
Quiksilver (ZQK) downgraded to Neutral from Buy at B. Riley
STMicroelectronics (STM) downgraded to Sell from Neutral at Citigroup
Sprague Resources (SRLP) downgraded to Neutral from Overweight at JPMorgan
Theravance (THRX) downgraded to Neutral from Outperform at RW Baird
Universal Electronics (UEIC) downgraded to Neutral from Buy at B. Riley
Volvo (VOLVY) downgraded to Sell from Neutral at Goldman
Xilinx (XLNX) downgraded to Neutral from Buy at Goldman
Zillow (Z) downgraded to Sector Perform from Outperform at Pacific Crest
Zillow (Z) downgraded to Sector Perform from Outperform at RBC Capital
Initiations
Akorn (AKRX) initiated with a Neutral at Goldman
American Realty (ARCP) initiated with a Buy at BofA/Merrill
Ashford Hospitality Prime (AHP) initiated with a Buy at BofA/Merrill
Brookdale Senior Living (BKD) initiated with a Buy at Jefferies
Dorian LPG (LPG) initiated with a Buy at UBS
GasLog Partners (GLOP) initiated with a Buy at Citigroup
GasLog Partners (GLOP) initiated with a Buy at UBS
GasLog (GLOG) reinstated with a Buy at Citigroup
K2M Group (KTWO) initiated with an Outperform at Wells Fargo
K2M Group (KTWO) initiated with an Overweight at Barclays
K2M Group (KTWO) initiated with an Overweight at Piper Jaffray
NOW Inc. (DNOW) initiated with a Neutral at RW Baird
Orbitz (OWW) initiated with a Hold at Deutsche Bank
Pacira Pharmaceuticals (PCRX) initiated with a Buy at Goldman
Physicians Realty Trust (DOC) initiated with a Buy at BofA/Merrill
SCYNEXIS (SCYX) initiated with an Outperform at JMP Securities
Starz (STRZA) initiated with a Neutral at Goldman
Theravance Biopharma (TBPH) initiated with a Neutral at RW Baird
COMPANY NEWS
Marathon Oil (MRO) said it will sell its Norway business to Det norske oljeselskap ASA for $2.7B
Ventas (VTR) to acquire American Realty Capital (HCT) for $2.6B in stock and cash
Biota Pharmaceuticals (BOTA) said it will reduce workforce by two-thirds in restructuring plan
Roche (RHHBY) acquires Genia Technologies for $125M in cash
Novartis (NVS) appointed Merck’s (MRK) Bruno Strigini as president of Novartis oncology
EARNINGS
MasTec (MTZ) lowers Q2 EPS view to 40c from prior view 53c, consensus 52c
Bridgepoint (BPI) sees Q1 EPS (11c)-(9c) and Q1 revenue $155.0M-$159.0M. On May 12, the company previously reported Q1 EPS of (10c) and Q1 revenue of $160.5M
Bridgepoint (BPI) restates FY13 earnings results
Actuant (ATU) will not provide guidance with Q3 earnings report
NEWSPAPERS/WEBSITES
Dai-ichi Life said to be in talks to buy Protective Life (PL) for $4.87B, WSJ reports
Shire (SHPG) secures $5B credit facility for NPS Pharma (NPSP) bid, Times of London says
Regulators probe trading of Carl Icahn, Billy Walters, Phil Mickelson, WSJ says
Lawyers say U.S. up against obstacles bringing case against Icahn (IEP), Reuters reports (CLX, DF)
Icahn calls insider trading report ‘irresponsible,’ Bloomberg says
ARM Holdings (ARMH) looking to get into wearables market, WSJ reports
Boeing (BA) sees 777 sales to remain strong, WSJ reports
Intel (INTC) TV creator, Erik Huggers, departs Verizon (VZ), Reuters reports
BARRON’S
Cliffs Natural’s (CLF) fight with Casablanca won’t help stock rebound, Barron’s says
Dick’s Sporting (DKS) recent insider buys appear bullish, Barron’s reports
Gannett (GCI) could be worth $34, Barron’s says
AmTrust Financial (AFSI) shares could be vulnerable, Barron’s says
RLJ Lodging Trust (RLJ), Alexandria Real Estate Equities (ARE), American Tower (AMT), and EPR Properties (EPR) have growth potential, Barron’s reports
Apple (AAPL), Oracle’s (ORCL) free cash flow could be driving shares higher, Barron’s says
SYNDICATE
Neonode (NEON) files to sell 5M shares of common stock
Tiptree Financial (TIPT) files to sell 31.5M shares of Class A common stock for holders
via Zero Hedge http://ift.tt/RXaIXM Tyler Durden