Author: admin

Following the lowest UMich confidence print in 2013, Gallup's economic confidence collapse, and Bloomberg's index of consumer comfort signaling major concerns among rich and poor in this country (in spite of record highs in stocks), today's Conference Board Consumer Confidence data  continues to confirm a problem for all those 'hoping' for moar multiple expansion. From 80.2 in September, confidence collapsed to 71.2 (the largest MoM drop in 2 years) to its lowest in six months, and notably below expectations. As we have noted in the past a 10 point drop in confidence has historically led to a 2x multiple compression in stocks (which suggests the Fed will need to un-Taper some more to keep the dream alive). Hope for the future dropped to 7-month lows but what is perhaps most intriguiging, just as with the Bloomberg surveys, we are seeing the wealthiest cohorts confidence plunging (even as stocks soar to new highs). It would appear the Fed has lost its wealth effect inpiration.

 

 

Once again we remind that it's all about confidence and hope appears to be fading…

As we have noted previously – this move in confidence is key…

But, it's all about confidence… investors will not be willing to pay increasing multiples unless they are confident that the future streams of earnings are sustainable and forecastable… And simply put, the current levels of Consumer Sentiment need to almost double for the US equity market tp approach historical multiple valuation levels…

 

 

 

and the cycle appears to be shifting…

Via Citi,

Is consumer confidence set to turn?

Consumer Confidence is once again following a dynamic where we see it move higher for 4 years and 4 months before beginning to collapse

• Moves higher from 1996-2000 with a smaller dip halfway through in October 1998
• Moves higher from 2003-2007 with a smaller dip hallway through in October 2005
• Moves higher and so far tops out in June 2013. Also sees a small dip halfway through in October 2011.

 

Higher yields do not help confidence…

 

A sharp rise in mortgage rates has a negative feedback loop to consumer confidence. For those families and individuals that were now looking/able to enter the housing market, the recent spike in rates acts as a headwind.

 

In addition to the economic backdrop, there is plenty of tail risk as we head into the end of the year. Oil prices have been rising since the summer began (and in reality since the Summer of 2012), partially due to geopolitical risks which are very much “top of mind.” A bigger spike due to a supply shock would choke the economic recovery.(In our view)

In the US, the appointment of a new Fed Chairman and the upcoming budget/debt ceiling debates are likely to bring added volatility. Tapering itself can also induce concern as the “Bernanke put” is being removed from markets.

In Europe, many of the structural problems related to the single currency union have not actually been addressed and the peripheral countries could still create turmoil going forward (see Fixed Income section focusing on Italy in particular for more on this). There has also been little concern with both the German elections and the German Court decision on the constitutionality of the OMT program. A surprise in either of these could be cause for concern.

Emerging Markets are still not out of the woods yet as growth has been weak relative to expectations and countries with current account deficits are beginning to feel pressure in their FX and Bond markets. This is an issue we believe is only starting to develop which we will continue to expand on at later dates.(We have also looked at this in our EM FX section this week)

Overall, the weak economic backdrop, poor housing recovery and potential for tail risk events over the next few months suggest that we have topped out in Consumer Confidence, a warning sign for equity markets.

 

The relationship between Consumer Confidence is clear, and IF June did mark the high and Confidence continues to decline, then we would expect to see that translate to weakness in the equity markets. The removal of the “Bernanke put” only adds to this concern.

A major turn has taken place in equity markets on average four months after Consumer Confidence turns, which would point to a decline beginning around September-October. As we have previously expressed, we remain of the bias that a correction in equity markets on the order of 20%+ is likely this year/ into 2014 and the current dynamics support such a move.

Should we see a decline of that magnitude, it is almost certain that yields would move lower in a rush to safe assets.

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/zwqfs9gPo5s/story01.htm Tyler Durden

The House Ways & Means Committee holds a hearing to receive testimony from Marilyn Tavenner, Administrator of the Centers for Medicare & Medicaid Services (CMS) at the U.S. Department of Health and Human Services (HHS). Grab your popcorn, nom nom nom

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/s8dtGaZFfTU/story01.htm Tyler Durden

September retail sales were a modest miss: that much was made clear earlier. However, what the market may have missed is that this “miss” was on the back of Department of Commerce’s favorite fudge factor: seasonal adjustments. The 0.1% “decline” in retail sales was for the seasonally adjusted numbers of $426.3 billion in August and $425.9 billion in September. So what happens when one strips away the Arima-X-12 a la carte adjustment which is always and everywhere in the eye of the beholder? Well, this:

As the chart above shows, the unadjusted retail sales number difference from August to September was a whopping $40 billion, or a 9% drop in one month, which in turn meant the headline retail sales number contained in it had an “adjustment factor” of $39.6 billion. This was the biggest NSA September retail sales drop on record, even worse than the prior worst such monthly drop posted in 2007 when the Second Great Depression was about to begin.

So one wonders: just what is the basis for the adjusters to apply the biggest ever seasonal add back to the raw number ever?

Either way, whatever it is, the algos are obviously infatuated with the record NSA September sales drop which is the reason for the fresh all time S&P high – if anything, record unadjusted retail sales drops is just what the Fed ordered to keep the taper forever on the backburner.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/-nwkIevufqQ/story01.htm Tyler Durden

September retail sales were a modest miss: that much was made clear earlier. However, what the market may have missed is that this “miss” was on the back of Department of Commerce’s favorite fudge factor: seasonal adjustments. The 0.1% “decline” in retail sales was for the seasonally adjusted numbers of $426.3 billion in August and $425.9 billion in September. So what happens when one strips away the Arima-X-12 a la carte adjustment which is always and everywhere in the eye of the beholder? Well, this:

As the chart above shows, the unadjusted retail sales number difference from August to September was a whopping $40 billion, or a 9% drop in one month, which in turn meant the headline retail sales number contained in it had an “adjustment factor” of $39.6 billion. This was the biggest NSA September retail sales drop on record, even worse than the prior worst such monthly drop posted in 2007 when the Second Great Depression was about to begin.

So one wonders: just what is the basis for the adjusters to apply the biggest ever seasonal add back to the raw number ever?

Either way, whatever it is, the algos are obviously infatuated with the record NSA September sales drop which is the reason for the fresh all time S&P high – if anything, record unadjusted retail sales drops is just what the Fed ordered to keep the taper forever on the backburner.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/-nwkIevufqQ/story01.htm Tyler Durden

It would appear that the ‘gambler’s in these 5 cities were not told that the government would be shutting down, that confidence would drop, that affordability would plummet… instead they were told that nothing has changed and 29% YoY home price gains are for buying not selling..

 

Year-over-Year Home Price Gains…

 

Though it does seem that some of the ‘froth’ is starting to fade in the Detroit metropolis… (though over 16% gains).

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ymZ0L-FY8Oc/story01.htm Tyler Durden

If yesterday’s collapse in September existing home sales was indicative that Housing is tumbling and it means the Fed will not taper until mid 2014 sending the S&P to a new record high, today’s August Case Shiller, which beat expectations of a M/M increase of 0.65% with a 0.93% print, and an increase of 12.82% Y/Y, probably means that the economy is very strong and will send the S&P to an even newer recorder high, since both bad and good news send only one signal to algos: buy. What is amusing is that while the NAR’s September fiasco was attributed to “concerns” over a government shutdown, the two month delayed Case Shiller print, which was for August, will be spun as no fears of a government shutdown in August, or something.

 

Listing the Top 5 cities in order of Y/Y price increase: Vegas +29.22%; San Francisco +25.4%; Los Angeles + 21.66; San Diego +21.5%; and….

Detroit +16.4%

That’s right: America’s biggest bankrupt city is among the Top 5 highest appreciating housing markets.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/SbNXjcc47TQ/story01.htm Tyler Durden

Moments ago hopes that the S&P would hit 1800 on an epic miss in the September retail sales were dashed after both the headline and ex-auto/gas numbers came largely in line. The total Seasonally Adjusted retail sales for September dipped modestly by 0.1%, on expectations of an unchanged print. Excluding autos the number was exactly in line with expectations at 0.4%, while ex autos and gas was also a very modest miss of 0.4% vs Exp. 0.5%. Still, hardly bad enough to send the S&P500 futures into the stratosphere. The biggest outliers by business category were motor vehicles which tumbled -2.2 in September, the biggest decline since October 2012 (did the US government suddenly stop making NINJA loans?), Miscellaneous stores and Clothing stores, down 1.2% and -0.5% respectively, while electronics and appliance stores rose 0.7% in September. In short: Americans may have no clothing as we enter the winter season, but at least they have the new iPad.

So while noted the number was hardly bad enough to send stocks surging, the ES-leading EURJPY pair seems to have found a third-wind bid in an attempt to expand the S&P500 multiple by at least another 0.1-0.2x today: could it be that algos just noticed that unadjusted retail sales tumbled by 9% from August to September.

Retail sales historic trend:

Charting the September retail sales broken down by category:

And by business:

Source: Census

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/RhBZHjNxF_E/story01.htm Tyler Durden

The news keeps going from worse to worse-er for the administration and Obamacare. The latest hit, however, does not revolve around the dysfunctional healthcare.gov website, whose hundreds of millions of lines of faulty code will take a very long time to fix, but relates to Obama’s promises that individuals would be able to keep their existing healthcare plans following the rollout of the Affordable Care Act. The truth, as NBC reports, is they can’t but what’s worse is that Obama knew as early as July 2010 that 40 to 67 percent of customers will not be able to keep their policy. And that’s not all: since the 14 millions consumers who buy their insurance individually will be forced into comparable plans, they are all set to experience a “sticker shock” when “opting” for the mandatory alternatives.

From NBC:

President Obama repeatedly assured Americans that after the Affordable Care Act became law, people who liked their health insurance would be able to keep it. But millions of Americans are getting or are about to get cancellation letters for their health insurance under Obamacare, say experts, and the Obama administration has known that for at least three years.

 

Four sources deeply involved in the Affordable Care Act tell NBC News that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”

The reason for the sticker shock: mandatory cadillac plan replacements:

Individual insurance plans with low premiums often lack basic benefits, such as prescription drug coverage, or carry high deductibles and out-of-pocket costs. The Affordable Care Act requires all companies to offer more benefits, such as mental health care, and also bars companies from denying coverage for preexisting conditions.

Obama, it turns out, knew all about this:

None of this should come as a shock to the Obama administration. The law states that policies in effect as of March 23, 2010 will be “grandfathered,” meaning consumers can keep those policies even though they don’t meet requirements of the new health care law. But the Department of Health and Human Services then wrote regulations that narrowed that provision, by saying that if any part of a policy was significantly changed since that date — the deductible, co-pay, or benefits, for example — the policy would not be grandfathered. 

 

Buried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, “40 to 67 percent” of customers will not be able to keep their policy. And because many policies will have been changed since the key date, “the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range.” 

 

That means the administration knew that more than 40 to 67 percent of those in the individual market would not be able to keep their plans, even if they liked them.

Enter the lies:

Yet President Obama, who had promised in 2009, “if you like your health plan, you will be able to keep your health plan,” was still saying in 2012, “If [you] already have health insurance, you will keep your health insurance.”

 

“This says that when they made the promise, they knew half the people in this market outright couldn’t keep what they had and then they wrote the rules so that others couldn’t make it either,” said  Robert Laszewski, of Health Policy and Strategy Associates, a consultant who works for health industry firms. Laszewski estimates that 80 percent of those in the individual market will not be able to keep their current policies and will have to buy insurance that meets requirements of the new law, which generally requires a richer package of benefits than most policies today.

The White House was ready with a canned response:

“Nothing in the Affordable Care Act forces people out of their health plans: The law allows plans that covered people at the time the law was enacted to continue to offer that same coverage to the same enrollees – nothing has changed and that coverage can continue into 2014,” she said.

 

White House spokesman Jay Carney was asked about the president’s promise that consumers would be able to keep their health care. “What the president said and what everybody said all along is that there are going to be changes brought about by the Affordable Care Act to create minimum standards of coverage, minimum services that every insurance plan has to provide,” Carney said. “So it’s true that there are existing healthcare plans on the individual market that don’t meet those minimum standards and therefore do not qualify for the Affordable Care Act.”

But the reality is always different:

Other experts said that most consumers in the individual market will not be able to keep their policies. Nancy Thompson, senior vice president of CBIZ Benefits, which helps companies manage their employee benefits, says numbers in this market are hard to pin down, but that data from states and carriers suggests “anywhere from 50 to 75 percent” of individual policy holders will get cancellation letters. Kansas Insurance Commissioner Sandy Praeger, who chairs the health committee of the National Association of Insurance Commissioners, says that estimate is “probably about right.” She added that a few states are asking insurance companies to cancel and replace policies, rather than just amend them, to avoid confusion.

 

A spokesman for America’s Health Plans says there are no precise numbers on how many will receive cancellations letters or get notices that their current policies don’t meet ACA standards. In both cases, consumers will not be able to keep their current coverage.

 

Those getting the cancellation letters are often shocked and unhappy.

In other words, nobody is kicked out of their existing plan… they just can’t keep it. Teleprompted semantics at its absolute best, or worst.

Finally, a case study in socialist failure:

George Schwab, 62, of North Carolina, said he was “perfectly happy” with his plan from Blue Cross Blue Shield, which also insured his wife for a $228 monthly premium. But this past September, he was surprised to receive a letter saying his policy was no longer available. The “comparable” plan the insurance company offered him carried a $1,208 monthly premium and a $5,500 deductible.

 

And the best option he’s found on the exchange so far offered a 415 percent jump in premium, to $948 a month.

 

“The deductible is less,” he said, “But the plan doesn’t meet my needs. Its unaffordable.”

 

“I’m sitting here looking at this, thinking we ought to just pay the fine and just get insurance when we’re sick,” Schwab added. “Everybody’s worried about whether the website works or not, but that’s fixable. That’s just the tip of the iceberg. This stuff isn’t fix
able.”

It isn’t, but who cares? By the time the realization that micromaganging anything and everything always fails, it will be someone else’s problem.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/CaIz9ox-NJs/story01.htm Tyler Durden

• U.S. spy chiefs face Congress amid spying rift with Europe (Reuters)
• Deutsche Bank income hit by €1.2bn of legal provisions (FT)
• China’s second tapering attempt fails: China central bank seeks to reassure money markets after rate spike (Reuters)
• UBS Takes Action Against Staff in Foreign-Exchange Probe (WSJ)
• Saudi Arabia frees man jailed for Mohammad tweets (Reuters)
• Tax Revolts Hit Hollande as Farmers, Soccer Clubs Protest (BBG)
• German parliament to meet over U.S. spying scandal (Reuters)
• Google Nears Smartwatch Launch (WSJ)
• How to end gridlock in DC? Pork projects (Reuters)
• UBS ordered to increase capital reserves (FT)
• U.K. Mortgage Approvals Rise to Highest in 5 1/2 Years (BBG)
• NSA Spying Allegations Put Google on Hot Seat in Brazil (BBG)
• Judge blocks part of Texas law restricting abortion (Reuters)
• Man Making Ireland Tax Avoidance Hub Proves Local Hero (BBG)

 

Overnight Media Digest

WSJ

* The chairwoman of the Senate Intelligence Committee, Dianne Feinstein, promised a total review of all U.S. spying programs for the first time in decades, and said she expected that the White House would end all spying on leaders of allied countries.

* Bond dealer Cantor Fitzgerald has sought to make Nevada’s legal sports books more like a financial platform but found the old ills of gambling hard to escape.

* Central banks in Russia and elsewhere are cutting purchase of gold, further weighing on prices of the metal. Prices are down 19 percent year to date. The last time gold prices posted an annual loss was 2000.

* Apple reported a third consecutive quarter of declining profits, but showed signs that both prices and profit margins are stabilizing despite heightened competition for its iPhone and iPad.

* After buying back its own shares from investors this year for the first time since the financial crisis in 2008, Morgan Stanley is considering asking the Federal Reserve for permission to purchase more stock next year.

* Consol Energy agreed to sell five Appalachian coal mines to Murray Energy, in a deal valued at $3.5 billion, its biggest step yet in shifting the focus of its business toward natural gas and away from coal.

* Higher mortgage rates and rising home prices scared off prospective home buyers in September, sparking the fourth straight monthly drop in a key measure of home sales.

* Aereo Inc’s upstart TV streaming service has provoked a legal onslaught from broadcast networks. But even if it wins that fight, it still has to overcome more-pedestrian issues, like making sure it can pay for the electricity it needs.

* Goldman Sachs said it has spent the past year working to improve the work-life balance of most-junior employees, known on Wall Street as analysts, by reducing their hours and other measures.

* The federal government is set to slap Infosys Ltd with the largest immigration fine ever, claiming the Indian outsourcing giant illegally placed workers on visitor, rather than work, visas at big corporate clients across the U.S.

The government is expected to announce Wednesday it will fine Infosys about $35 million, according to people close to the matter.

 

FT

Britain’s Chancellor of the Exchequer, George Osborne, is set to announce the country’s plans to issue the first Islamic bond outside the Muslim world, hoping that the 200 million pound ($322.62 million) bond will act as a catalyst for London to become a leading player in the sharia-compliant finance market.

Swiss prosecutors have begun a criminal investigation into Formula One Chief Executive Bernie Ecclestone for bribing a German banker to smooth the sale of a stake in the motor racing business to private equity firm CVC in 2006.

G4S, the world’s largest security services firm, denied allegations of its involvement in the abuse – including electric shock treatment and forced injections – of inmates at its Mangaung prison in South Africa.

Germany’s Deutsche Boerse said it had received an offer from the United States to settle a probe into the exchange operator’s alleged breach of U.S. sanctions against Iran for $152 million.

European aerospace group EADS is planning to axe jobs and cut costs in a bid to restructure its defence business, which has been languished due to Europe’s long-term decline in military spending.

 

NYT

* President Obama was poised to order a ban on spying on heads of allied states in response to a deepening diplomatic crisis over reports that the National Security Agency had for years targeted the cellphone of Chancellor Angela Merkel of Germany.

* Microloans, born of anti-poverty efforts in developing countries, is attracting American clients who do not qualify for credit cards or traditional bank loans.

* Consol Energy Inc, the largest coal producer in the eastern United States, said on Monday that it was selling five highly automated mines – about half of its production capacity – to focus instead on natural gas and on mines that produce coal for export.

* Apple Inc now has more product offerings. And Apple now sells its products in more places. But for the third consecutive quarter, Apple does not have more profit.

* New ways to monitor students around the clock raise questions about whether educators can or should legally discipline children for online outbursts.

* In a shift away from robots made to perform in factories, designers are putting the “human” into humanoids so that they can safely interact in public.

* Governor Rick Snyder of Michigan, in testimony on Monday, forcefully defended Detroit’s bankruptcy filing as a last-ditch effort to stem the city’s decades-long financial decline.

* Marilyn Tavenner, who runs the Centers for Medicare and Medicaid Services, will testify on Tuesday before a House panel on the problems with the health care website.

* A federal judge on Monday sentenced former Representative Rick Renzi to three years in prison for convictions on public corruption, money laundering and othe
r charges, capping a corruption case prosecutors said began more than a decade ago.

* The autobiography of the pop star Morrissey, which has become a quick sensation in Britain, has found an American publisher. G.P. Putnam’s Sons, an imprint of Penguin Random House, acquired the memoir, two people involved in the negotiations said on Monday.

 

Canada

THE GLOBE AND MAIL

* Canadian Senator Mike Duffy says staff in the office of Prime Minister Stephen Harper arranged for a Conservative Party lawyer to cover his legal fees – a payment that was in addition to the cheque for C$90,000 that Harper’s former chief of staff wrote to foot the bill for Duffy’s improperly claimed expenses.

* The world’s first Bitcoin ATM goes live on Tuesday – and it will be installed inside a downtown Vancouver coffee shop. Mitchell Demeter, co-founder of the Vancouver-based store Bitcoiniacs, is the man behind the automated teller machine’s arrival.

Reports in the business section:

* Private-sector economists are pressing Canadian Finance Minister Jim Flaherty to keep a closer eye on Canada’s housing market in light of persistently low interest rates.

* The head of Canada’s wireless lobby group, Bernard Lord, says unneeded regulation and a lack of available spectrum is jeopardizing the country’s status as a place with the fastest networks in the world.

NATIONAL POST

* Another increase in median wait times for medical treatment despite fast-growing public healthcare spending means Canada should look abroad for alternative ways of delivering universal healthcare with private options, say the authors of a new report.

* A 71-year-old Iranian-born man with a legally altered name faces three criminal charges in connection with an alleged attempt to bring explosive material onto an airplane. He was charged on Monday over the incident, which paralyzed Montreal’s main airport on Sunday for several hours and caused a neighborhood to be shut down for a police search.

FINANCIAL POST

* The Canadian government has no plans for now to clamp down on the housing market even though prices are rising again, Finance Minister Jim Flaherty said on Monday, but he pledged to investigate whether the price uptick looks to be more than temporary.

* Canada’s oil and gas industry is “losing the war” against anti-hydrocarbon activism as the balance of power tilts in favor of project opponents, says the head of Quebec’s Oil and Gas Association.

 

China

CHINA SECURITIES JOURNAL

— China may launch a pilot scheme in some cities as early as next year to promote standardisation and energy saving in the property development market.

SHANGHAI SECURITIES NEWS

— Internet firm Baidu raised 1 billion yuan ($164.33 million) in just two hours for its first wealth management product.

— Healthcare for the elderly is set to be a long-term hot spot for China. By 2020, the country’s health service sector will be worth over 8 trillion yuan ($1.31 trillion), according to the State Council. This has prompted the country to spend 2.2 billion yuan ($361.52 million) to spur development in the sector.

SECURITIES TIMES

— China may introduce a series of reform measures in the Shanghai Free Trade Zone, including raising the ceiling on yuan deposit rates and allowing foreign companies registered in the zone to trade Chinese stocks and futures.

— Taobao, an online marketplace owned by Alibaba, will soon be granted a licence to distribute mutual fund products.

PEOPLE’S DAILY

— Reform should be aimed at eliminating special interest within the Communist Party, the official mouthpiece paper said in an editorial. It added that the source of the Party’s power is the interest of the public.

CHINA DAILY

— Close to 80 percent of doctors say they do not want their children to pursue a career in medicine, according to a survey by the Chinese Medical Doctor Association. This is up from around 60 percent in 2009, with doctors citing poor salaries and growing tension with patients.

Shanghai Daily

— A merger between Jiefang Daily Group and Wenhui-Xinmin United Press group has created the country’s biggest newspaper company, with total assets of 20.87 billion yuan. The publisher of the new Shanghai United Media Group, Qiu Xin, said the move will help “promote Shanghai’s media influence”.

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

Advanced Energy (AEIS) upgraded to Buy from Hold at Needham
Apple (AAPL) upgraded to Outperform from Neutral at RW Baird
Arcos Dorados (ARCO) upgraded to Overweight from Neutral at JPMorgan
Altra Holdings (AIMC) upgraded to Buy from Underperform at BofA/Merrill
Costamare (CMRE) upgraded to Overweight from Neutral at JPMorgan
Green Dot (GDOT) upgraded to Overweight from Neutral at Piper Jaffray
Marketo (MKTO) upgraded to Buy from Neutral at Goldman
Onconova Therapeutics (ONTX) upgraded to Buy from Neutral at Citigroup
Yahoo (YHOO) upgraded to Outperform from Market Perform at Bernstein

Downgrades

American Capital Agency (AGNC) downgraded to Neutral from Buy at BofA/Merrill
Banco Bilbao (BBVA) downgraded to Neutral from Outperform at Credit Suisse
Banco Bilbao (BBVA) downgraded to Underperform from Neutral at BofA/Merrill
CAI International (CAP) downgraded to Market Perform from Outperform at Cowen
Changyou.com (CYOU) downgraded to Hold from Buy at Brean Capital
Coca-Cola HBC (OCCH) downgraded to Reduce from Neutral at Nomura
Donaldson (DCI) downgraded to Neutral from Buy at BofA/Merrill
Eagle Rock Energy (EROC) downgraded to Neutral from Buy at BofA/Merrill
Goldcorp (GG) downgraded to Neutral from Overweight at HSBC
Innophos Holdings (IPHS) downgraded to Hold from Buy at KeyBanc
Key Energy (KEG) downgraded to Sell from Hold at Wunderlich
Komatsu (KMTUY) downgraded to Hold from Buy at Jefferies
Michael Kors (KORS) downgraded to Market Perform from Outperform at Wells Fargo
Sunstone Hotel (SHO) downgraded to Neutral from Buy at ISI Group
TAL International (TAL) downgraded to Market Perform from Outperform at Cowen
Textainer (TGH) downgraded to Market Perform from Outperform at Cowen
UIL Holdings (UIL) downgraded to Sector Perform from Outperform at RBC Capital
Volcano (VOLC) downgraded to Hold from Buy at Canaccord
Volcano (VOLC) downgraded to Neutral from Outperform at Credit Suisse
Volcano (VOLC) downgraded to Neutral from Overweight at JPMorgan
Wausau Paper (WPP) downgraded to Hold from Buy at Deutsche Bank

Initiations

A.P. Pharma (APPA) initiated with a Buy at Brean Capital
AmerisourceBergen (ABC) initiated with a Market Perform at FBR Capital
Bill Barrett (BBG) initiated with a Buy at KeyBanc
CBS (CBS) initiated with an Outperform at FBR Capital
Cardinal Health (CAH) initiated with an Outperform at FBR Capital
Cherry Hill Mortgage (CHMI) initiated with a Buy at Citigroup
Cherry Hill Mortgage (CHMI) initiated with an Overweight at Barclays
Dollar General (DG) initiated with a Positive at Susquehanna
GameStop (GME) initiated with a Buy at Stifel
Interpublic Group (IPG) initiated with a Market Perform at FBR Capital
McGraw Hill Financial (MHFI) initiated with an Outperform at FBR Capital
McKesson (MCK) initiated with an Outperform at FBR Capital
Moody’s (MCO) initiated with an Outperform at FBR Capital
Multi-Color (LABL) initiated with an Outperform at BMO Capital
NL Industries (NL) initiated with an Outperform at Credit Suisse
OCI Partners (OCIP) initiated with a Buy at BofA/Merrill
OCI Partners (OCIP) initiated with a Neutral at Citigroup
Omnicom (OMC) initiated with an Outperform at FBR
Capital
Potbelly (PBPB) initiated with a Neutral at Goldman
Potbelly (PBPB) initiated with an Overweight at Piper Jaffray

HOT STOCKS

Sears Holdings (SHLD) evaluating separating Lands’ End business and Sears Auto Center, announced sale of five Canadian store leases for C$400M
UBS (UBS) said received requests from various authorities relating to their foreign exchange businesses, said FINMA order could delay return on equity target
Lloyds Banking (LYG) said talks with regulators commenced on dividends
Apple (AAPL) to announce any changes to current capital plan in first part of 2014
Plum Creek Timber (PCL) to acquire $1.1B in acres from MeadWestvaco (MWV); MWV to return $665M of PCL transaction to holders
NTT (NTT) to acquire Virtela for $525M
Electronic Arts (EA) said Tiger Woods no longer associated with golf title

EARNINGS

Companies that beat consensus earnings expectations last night and today include:

M.D.C. Holdings (MDC), Regal-Beloit (RBC), U.S. Steel (X), Reinsurance Group (RGA), Olin Corp. (OLN),  CTS Corporation (CTS), HealthSouth (HLS), Apple (AAPL), PartnerRe (PRE), Jones Lang LaSalle (JLL), Hartford Financial (HIG), Kaman (KAMN), Intevac (IVAC), CNO Financial (CNO), Plum Creek Timber (PCL), Nutrisystem (NTRI), Integrated Device (IDTI)

Companies that missed consensus earnings expectations include:

Aetna (AET),  NewMarket (NEU), LINN Energy (LINE), Compass Minerals (CMP), Invesco Mortgage (IVR), ARMOUR Residential (ARR), Herbalife (HLF), Celadon Group (CGI), Seagate (STX), Wausau Paper (WPP)

Companies that matched consensus earnings expectations include:

Air Products (APD), Huntsman (HUN), Sensata (ST), Denny’s (DENN)

NEWSPAPERS/WEBSITES

• The end could be near for cookies that marketers deploy on Web browsers to track people’s online movements, serve targeted advertising and amass valuable user profiles. Microsoft (MSFT), Google (GOOG) and Facebook (FB) have said they are developing systems to plug into and control this  data in ways that bypass the more than a thousand software companies that place cookies on websites, the Wall Street Journal reports
• After buying back its own shares from investors this year for the first time since the financial crisis, Morgan Stanley (MS) is considering asking the Fed for permission to purchase more stock next year, a move aimed at boosting its middling returns on equity, the Wall Street Journal reports
• Agnico Eagle Mines (AEM) is considering selling a minority stake in its Meliadine gold project in the Canadian sub Arctic, sources say, Reuters reports
• Apple’s (AAPL) forecast for the slowest holiday sales growth in a half decade reflects how iPhones and iPads aren’t providing the growth surges they once did as competition accelerates in the saturated mobile market, Bloomberg reports
• Twitter (TWTR) kicked off the road show for its IPO with a low-key affair compared with Facebook’s (FB), reflecting Twitter’s quieter approach to the process, underscored by its decisions to file confidentially and limit private trading of its shares, Bloomberg reports
• The debut of Brixmor Property Group (BRX) is adding fuel to what is already the biggest year for U.S. real estate IPOs in about a decade. The shopping-center landlord, owned by Blackstone (BX), is set to raise as much as $905.6M including extra shares for underwriters, Bloomberg reports

SYNDICATE

Artisan Partners (APAM) files to sell 4.8M shares of common stock
BankUnited (BKU) 9M share Secondary priced at $30.75
Colony Financial (CLNY) files to sell 10M shares of common stock
F.N.B. Corp. (FNB) to offer up to $50M worth of common stock
Plum Creek Timber (PCL) files to sell 14M shares of common stock
SL Green Realty (SLG) files to sell 2.6M shares of common stock
Sunstone Hotel (SHO) files to sell 20M shares of common stock
Tableau Software (DATA) files to sell common stock for holders

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/D9s7UShVeKw/story01.htm Tyler Durden