Taiwanese Summit Manufacturers Suppliers of Taiwanese ...
AIAG.org - Automotive Industry Action Group
AUTO SUMMIT TRADING CO., LTD. Taiwantrade
DUCATI MONSTER INTEGRATED LED TAIL LAMP AUTO SUMMIT ...
VeChain
VeChain connects blockchain technology to the real world by providing a comprehensive governance structure, a robust economic model, and IoT integration. VeChain is the pioneer of real-world applications using public blockchain technology. Together with our strategic partners PwC and DNV GL, we have established cooperative relations with many leading enterprises in different industries, including Walmart China, BMW, BYD Auto, Haier, H&M, LVMH, D.I.G, ENN, AWS, PICC, ASI
TECK ($11.16) Teck Announces Agreement in Principle with Westshore (Overnight News)
OXY ($13.51) Occidental Announces Early Tender Results in Cash Tender Offers and Consent Solicitations for Certain of its Senior Notes Maturing in 2021 (Overnight News)
NEU Afton Chemical Announces Phase 3 Investment in the Singapore Chemical Additive Manufacturing Facility to Add GPA Blending Capabilities (Overnight News)
EBAY Australia's Zip teams up with eBay for flexible credit to businesses; shares soar (Overnight News)
ALGN Align Technology Reaches 1 Millionth Invisalign Patient Milestone in the Asia Pacific Region (Overnight News)
GLPG Galapagos to present new insights in IPF and related clinical developments at the European Respiratory Society Congress (Overnight News)
KKR Italy clears KKR purchase of stake in TIM network: paper (Overnight News)
APM ($2.81) Aptorum Group to Present at The LD 500 Virtual Conference and H.C. Wainwright 22nd Annual Global Life Sciences Conference (Overnight News)
AAPL iPhone Sales Remained Flat Worldwide In Q2, Even As Wider Smartphone Market Slumped: Gartner (Overnight News)
PHG Philips announces new imaging and workflow enhancements for KODEX-EPD cardiac imaging and mapping system to treat heart rhythm disorders (Overnight News)
JNPR Juniper Networks and Netcracker Announce Joint Enterprise Service Automation Solution (Overnight News)
CCP NCLH Carnival Shares Drop As Princess, Cunard Lines Extend Cancellations To Next Year And Beyond (Overnight News)
End of Day and After Hours News Heading into Wednesday August 26th 2020 (News Traded 4:00 PM - 8:00 PM EST)
WU Western Union and Producers Bank Renew Relationship
OII ($5.36) Oceaneering wins NASA contract to support human lunar landing systems
RGLY ($11.45) Processing a record home-sales jump, Evercore sees 48% upside in real estate name
TRXC ($0.40) TransEnterix Announces New Employment Inducement Grant
CBL ($0.19) CBL, credit pact lenders in talks on balance sheet restructuring
FMCC ($2.20) Freddie Mac mortgage portfolio grows 20%, annualized, in June
FMNA ($2.22) Fannie Mae, Freddie Mac will delay controversial refinance fee
Earnings Scheduled For August 26, 2020 (BOX, DKS, CHS, DY, BOSC, EV)
----------------------------------------------- Morning Research and Trading Prep Tool Kit Other Useful Resources: The Ultimate Quick Resource For the Amateur Trader. Subscribe to This Brief and the daily 4:00 AM Pre Market Brief on The Twitter Link Here . Alerts in the tweets will direct you to the daily brief in this sub It is up to you to judge the accuracy and veracity of the above before trading. I take no responsibility for the accuracy of the information in this thread.
Significant Activist Hedge Fund Activity (Last 7 Days)
These are the latest Schedule 13D forms filed by activist investors in the last 7 days. Activist investors are investors that make an investment with the intention of influencing management in some way. There is evidence that following activist investors into investments can generate excess returns. Schedule 13G forms, in contrast, are filed by significant investors with no intention of influencing management (such as Index funds). There is always a lot of interest in insider trades, but what a lot of people probably don't realize is that hedge fund activity is probably more predictive of future returns than insider activity. The reason is that hedge funds (a) have large research budgets, and (b) have a choice where to put their money. In contract, insiders have no choice where to put their money, but only when to time their transactions.
New Filings
This table lists new 13D filings in the last week. A new filing does not necessarily indicate a new position, as investors frequently accumulate in advance before reaching the filing threshold.
This table lists amended filings in the last week, and is useful for monitoring changes in existing investments or when a fund closes a position. I have eliminated all filings with less than a 5% change in ownership.
TOP NEWS • Morgan Stanley profit rises 19 pct on equity trading strength Morgan Stanley reported a 19 percent increase in quarterly profit, with strong performance in its equities trading business outweighing weakness in bond trading. • Johnson & Johnson profit beats, lifts forecast on cancer drug demand Johnson & Johnson reported quarterly profit above estimates and raised its full-year forecast, as demand for its cancer drugs Zytiga and Imbruvica helped offset decline in sales of blockbuster drug, Remicade. • UnitedHealth tops earnings estimates, raises 2018 forecast UnitedHealth Group added more members to its health plans in the third quarter, helping it to post a profit well above Wall Street estimates and boost its earnings forecast for the year. • BlackRock profit beats on demand for low-risk funds BlackRock reported a better-than-expected quarterly profit, as more people poured money in its low-risk funds amid heightened trade tensions between Beijing and Washington. • Ad firm Omnicom's quarterly revenue slips marginally U.S. advertising company Omnicom Group's quarterly revenue fell marginally weighed by a strong dollar. STOCKS TO WATCH Results • BlackRock Inc (BLK). The world’s biggest asset manager reported a better-than-expected quarterly profit, as more people poured money in its low-risk funds amid heightened trade tensions between Beijing and Washington. More investors, however, pulled out money from the asset manager's institutional index funds, while putting in more money into its low-risk iShares exchange-traded funds. Net income attributable to the company rose to $1.22 billion in the third quarter from $944 million a year earlier. On a per share basis, BlackRock earned $7.54, compared with $5.76 a year earlier. Excluding items, the company earned $7.52 per share, while analysts had expected $6.84. • Infosys Ltd (INFY). The company posted better than expected second-quarter profit, helped by a rise in big deals, and reiterated its forecast for full-year revenue growth. Having lifted its number of $100 million-plus clients to 23, compared with 19 in the same quarter last year, Infosys retained guidance for full-year revenue growth of 6-8 percent in constant currency terms, in line with broker expectations. Profit rose 10.3 percent to 41.10 billion rupees ($558.04 million) in the quarter beating analyst estimates of 40.51 billion rupees. • Johnson & Johnson (JNJ) .The healthcare conglomerate reported a 4.5 percent rise in quarterly profit and boosted its sales and earnings per share guidance, as rising sales of its cancer drugs Zytiga and Darzalex helped offset falling sales of blockbuster arthritis drug Remicade. The company’s net earnings rose to $3.93 billion, or $1.44 per share, in the third quarter, from $3.76 billion, or $1.37 per share, a year earlier. Sales rose 3.6 percent to $20.35 billion. • Morgan Stanley (MS). The company reported a 19 percent increase in quarterly profit, with strong performance in its equities trading business outweighing weakness in bond trading. Net income attributable to Morgan Stanley rose to $2.11 billion, or $1.17 per share, in the third quarter ended Sept. 30, from $1.78 billion, or 93 cents per share, a year ago. Analysts were expecting $1.01 per share. • Omnicom Group Inc (OMC). U.S. advertising company’s quarterly revenue fell marginally, weighed by a strong dollar. Omnicom, one of the world's "Big Four" ad companies, said net income available for common shares rose to $298.9 million, or $1.32 per share in the third quarter ended Sept. 30, from $263.3 million, or $1.13 per share. Revenue fell to $3.71 billion from $3.72 billion, a year earlier. • UnitedHealth Group Inc (UNH). The largest U.S. health insurer added more members to its health plans in the third quarter, helping it to post a profit well above Wall Street estimates and boost its earnings forecast for the year. The company said it now expects full-year adjusted earnings per share to approach $12.80, compared with its prior forecast of between $12.50 and $12.75. UnitedHealth's insurance business added 2.8 million more members year-over-year in the third quarter and raked in revenue of $45.94 billion, 12.8 percent higher than last year. Net earnings attributable to shareholders rose 28 percent to $3.19 billion, or $3.24 per share in the quarter. Excluding items, the company earned $3.41 per share. Total revenue rose 12.4 percent to $56.56 billion. Deals Of The Day • Twilio Inc (TWLO) & SendGrid Inc (SEND). Twilio said on Monday it would buy email technology firm SendGrid in an all-stock deal valued at about $2 billion, combining two firms that handle communications between apps and their users. Twilio will offer 0.485 share of its stock for each SendGrid Class A common share. The deal is worth about $36.92 per share, a premium of 19.4 percent to SendGrid's closing price on Monday. In Other News • Alphabet Inc (GOOGL). Google on Monday became the latest company to drop out of a business conference in Saudi Arabia. Google said in a statement that Google Cloud Chief Executive Diane Greene would not attend the Future Investment Initiative Summit scheduled to be held in Riyadh starting October 23. • Amazon.com Inc (AMZN). The company is likely to buy an at least 7 percent to 8 percent stake in India's Future Retail through an investment arm, CNBC-TV 18 reported, citing sources. The potential cash-and-stock deal, which is in its final stages, could be worth 25 billion rupees ($338 million) and is likely to be signed in the next two weeks, the channel said. Separately, Britain's competition regulator will include German discounters Aldi and Lidl, and online retailer Amazon, in its probe into Sainsbury's proposed takeover of Asda, as well as long-standing supermarket rivals like Tesco. • Berkshire Hathaway Inc (BRKa). NetJets, the luxury plane unit of Warren Buffett's Berkshire Hathaway, announced a deal on Monday to purchase up to 325 Cessna Citation business jets from Textron’s aviation unit, one of the biggest orders unveiled at a major jet show this week in Orlando, Florida.Rob Scholl, a spokesman for Textron Aviation, said he expects NetJets to firm up the orders for up to 175 super-midsize Cessna Citation Longitude aircraft and up to 150 Cessna Citation Hemisphere aircraft in the coming weeks. Deliveries are expected in the fourth quarter of 2019. • Curtiss-Wright Corp (CW). Indal Technologies, a unit of Curtiss-Wright, has agreed to pay $3.5 million to resolve allegations that it knowingly sold defective military equipment to the U.S. Navy, the U.S. Justice Department said on Monday. Indal Technologies allegedly substituted a less-expensive type of steel used in helicopter landing systems for U.S. Navy destroyers, the department said in a press release. "When government contractors supply our armed forces with equipment that fails to meet performance standards, they not only cheat taxpayers, but they put at risk the safety of our service members," Assistant Attorney General Joseph Hunt said in a statement announcing the settlement. • Facebook Inc (FB).O The company will ban false information about voting requirements and fact-check fake reports of violence or long lines at polling stations ahead of next month's U.S. midterm elections, company executives told Reuters, the latest effort to reduce voter manipulation on its service. The new policy was disclosed by Facebook's cybersecurity policy chief, Nathaniel Gleicher, and other company executives. “We don’t believe we should remove things from Facebook that are shared by authentic people if they don’t violate those community standards, even if they are false,” said Tessa Lyons, product manager for Facebook's News Feed feature that shows users what friends are sharing. • Ford Motor Co (F). The U.S. carmaker unveiled a new China sport utility vehicle and said its plan to release a spate of new models will help turn around tumbling sales in the world's top auto market from the start of next year. Ford, fighting to recover from a severe sales slump in China, will start selling the entry-level SUV, called the "Territory", early next year. The car is jointly developed with local partner Jiangling Motors Corp. The car, based on a no-frills model from JMC, is aimed at appealing to consumers in China's smaller, so-called lower-tier cites, which have been a major engine of growth in the market over the last decade. • Microsoft Corp (MSFT). The company’s co-founder Paul Allen, who had been suffering from non-Hodgkin's lymphoma, a form of cancer, passed away at the age of 65 on Monday, his family said. "Paul Allen's contributions to our company, our industry and to our community are indispensable," Microsoft Chief Executive Officer Satya Nadella said in a statement. "As co-founder of Microsoft, in his own quiet and persistent way, he created magical products, experiences and institutions, and in doing so, he changed the world." • OnDeck Capital Inc (ONDK). The company has set up a subsidiary that will provide technology and other services to banks looking to lend to small businesses online it said. Called ODX, the new company will expand OnDeck's existing business of providing online lending software to banks, such as JPMorgan Chase, the company said. • Qualcomm Inc (QCOM). The company and the U.S. Federal Trade Commission on Monday asked a federal judge to delay a preliminary ruling in an antitrust case U.S. regulators brought against the mobile chip company in order to pursue settlement talks. In a joint filing in the U.S. District Court for the Northern District of California in San Jose, they asked a judge to delay ruling on the FTC's motion for partial summary judgment for 30 days. • Regeneron Pharmaceuticals Inc (REGN). Drugmakers Sanofi and Regeneron said that they received positive results for their Dupixent product, which treats eczema and is seen as a key driver of future revenues. Sanofi and Regeneron said in a joint statement that two pivotal Phase 3 placebo-controlled trials evaluating Dupixent (dupilumab), in adults with inadequately controlled chronic rhinosinusitis with nasal polyps, had met all primary and secondary endpoints. The U.S. Food & Drug Administration regulator is expected to approve Dupixent for asthma treatment before the year-end. • Sears Holdings Corp (SHLD). A bankruptcy judge on Monday approved $300 million in financing to keep department store chain Sears open through the holiday season, giving the century-old retailer that once dominated U.S. shopping malls a chance to remain in business. "For somebody of my generation, Sears Roebuck was a big deal... Sears has been dying for many years, it has been obviously improperly run for many years, and it's a shame," U.S. President Donald Trump told reporters on Monday. • Tesla Inc (TSLA). The company’s Chief Executive Officer Elon Musk said a new chip that improves autopilot features would be available in about six months in all of the company's new production electric cars. In a series of tweets, Musk said ..."~6 months before it is in all new production cars. No change to sensors. This is simple replacement of the Autopilot computer. Will be done free of charge for those who ordered full self-driving." Musk also tweeted that the new chip would improve the performance of Tesla's Autopilot between 500 percent and 2000 percent. • United States Steel Corp (X). The United Steelworkers (USW) union said on Monday it reached a tentative agreement with U.S. Steel Corp covering 16,000 workers across the country. The union has been negotiating with the Pittsburgh-based steelmaker for demands including higher wages. • Walmart Inc (WMT). The retailer lowered its earnings guidance for the year to include the impact from its acquisition of Indian ecommerce company Flipkart. The company now expects to earn between $4.65 and $4.80 per share for fiscal 2019 from an earlier forecast of $4.90 and $5.05 per share. Edit1: Sauce
This is a list of the top 20 companies that experienced the largest change in insider shares in the last seven (7) days. The SEC defines an insider as any officer, director or 10% shareholder. It is not illegal for these people to buy or sell their own shares. In fact, since most of them get paid in stock options, it is expected. However, it is illegal for them to trade on inside information that has not been made public. So for example if there are drug trial results that are bad and not public, insiders cannot dump shares. That said, many people have observed that insiders - in general - seem to have a good track record at timing their purchases. All trades that are marked as part of a 10b5 plan are excluded from this report.
-Chinese auto company Foton to build manufacturing plant in Pakistan Prime Minister Imran Khan visited headquarters of FOTON automotive in Beijing today. FOTON is investing in Pakistan through establishment of assembly plant as a joint venture. Founded on August 28, 1996, Beiqi Foton Motor Co., Ltd. (Foton) is a trans-regional, trans-industry and trans-ownership state holding listed company. -Pakistan Post introducing 614 brands through e commerce Minister for Communications and Postal Services Murad Saeed has said Pakistan Post is introducing 614 brands through e-commerce. Speaking at a ceremony in Islamabad today, he said the pilot project of postal service introducing innovative ways to enhance performance and credebility of Pakistan has been introduced in 10 cities of the country. -Pakistan China ink 11 agreement and much more during PM Khan visit to China Advisor to Prime Minister on Commerce, Textile, and Industry Abdul Razak Dawood on Sunday said 11 agreements had been signed with China in the sectors of Information Technology, agriculture, railways and chemicals. “Many investors are ready to come to Pakistan,” Abdul Razak Dawood said while talking to media after the Free Trade Agreement with China . He said an agreement had been signed on Pak-China Free Trade Agreement (FTA). The PM’s advisor said around 400 investors had come to attend the Belt and Road Forum. “I was surprised to see so many investors in the forum.” -Car production up 1.28 pc to 0.156mn units in 8 months The production of cars and jeeps witnessed 1.28 percent increase during the first eight months of the fiscal year 2018-19 against the output of the same period of last fiscal year, Pakistan Bureau of Statistics (PBS) reported. As many as 156,720 jeeps and cars were manufactured during July-February (2018-19) against the production of 154.732 units during July- February (2017-18), showing growth of 1.28 percent. However, the production of light commercial vehicles (LCVs) witnessed decrease of 12.78 percent in production during the period under review by going down from 19,907 units last year to 17,363 LCVs during 2018-19. The production of motorcycles decreased by 10.01 percent from 1,857,210 units last year to 1,671,346 units during the same period. The production of trucks also decreased from 6,081 units last year to 4,679 units, showing decline of 23.06 percent while the production of tractors decreased by 30.05 percent, from 45,576 units to 31,879 units. The production of buses during the period under review however witnessed positive growth of 23.61 percent by going up from the output of 487 units to 602 units. Meanwhile, on year-on-year basis, the production of jeeps and cars decreased by 1.98 percent during the month of February 2019 against the output of February 2018. -Pakistan beat Uzbekistan in first rugby game in Lahore Pakistan beat Uzbekistan in first rugby game by 44 tries at Pakistan Rugby Academy Lahore on Sunday. Pakistan were not off to a good start as the visiting side dominated the first half of the match but later on, the green shirts made a comeback and left Uzbekistan behind. The tourists managed to score 13 tries in reply. Pakistan leads two test match series 1-0. The second match of the series is scheduled on May 1 at the same venue. Earlier, Uzbekistan’s hockey and rugby team landed in Lahore on Saturday in a bid to revive international sporting events in Pakistan. -Pakistan announces 1000 scholarships for Sri Lankan students The Higher Education Commission (HEC) has announced ‘Allama Iqbal Scholarships’ for as many as 1000 Sri Lankan students to study in the best higher educational institutions of Pakistan. According to the sources, the scholarships would be provided under the Pak-Sri Lanka Higher Education Cooperation Programme. The scholarship offers full tuition fee of the programme for study in Pakistani universities, accommodation allowance, study allowance, books allowance, and one-time return air-ticket, sources said. -Senate sees off religious parties' opposition to pass bill against child marriage The Senate on Monday passed the Child Marriage Restraint (Amendment) Bill, 2018 which proposes that the legal minimum age of marriage in the country be set at 18. The bill was presented by PPP Senator Sherry Rehman, who told the House that according to a report by the United Nations Children's Fund, around 21 per cent Pakistanis got married before turning 18. She also pointed out that Muslim countries including Oman, Turkey and United Arab Emirates have already set 18 as the minimum age of entering marriage. Rehman also apprised the upper house of the fatal threat that underage marriages pose to mothers. "One woman dies in childbirth every 20 minutes," she said, adding that the reason for these deaths were early pregnancies. -Pakistan to get duty-free access to Chinese markets Pakistan and China on Sunday signed the second phase of the Free Trade Agreement (FTA) after which Pakistan will get duty-free access to Chinese markets. Prime Minister Imran Khan and his Chinese counterpart Li Keqiang witnessed the signing ceremony held here at Diaoyutai State Guest House. The other memorandums of understanding (MoUs) and agreements signed on the occasion included declaration for completion of preliminary design of phase-I for upgradation of ML-1 and establishment of Havelian dry port under CPEC, MoU on cooperation in the field of marine sciences between China Geological Survey (CGS), Ministry of Natural Resources of China, the Institute of Oceanography, Ministry of Science and Technology, MoU between CIDCA and Ministry of Planning, Development and Reform on Implementation of the Projects under JWG of CPEC on socio-economic development, China-Pakistan Economic and Technical Cooperation Agreement and Rashakai SEZ Joint Venture and licence agreement between KPEZMDC and CRBC. Earlier, Prime Minister Imran Khan held a bilateral meeting with Chinese Premier Li Keqiang at the conclusion of the 2nd Belt and Road Forum (BRF). The two prime ministers were accompanied by ministers and senior officials during the meeting. -Pakistan’s First Vlog Summit 2019 Successfully Concludes Vlog Summit 2019 was held at Shah Abdul Latif Bhittai Auditorium Islamabad where prominent local and international Vloggers came on the same platform for the very first time and shared their success stories and current vlogging trends. They elaborated how a vlog can be used to influence the opinion of masses. Participants of the summit came from both the government and corporate sector. Chief Guest of the event Mr. Lijian Zhao – Deputy Chinese Ambassador shared his views about the event saying, “Such sessions are healthy and must be organized regularly to increase awareness about the trending mediums”. He added that Pakistan is now among the top travel destinations around the world and it is very safe to travel within Pakistan. At the end, he said, “I highly appreciate the efforts made by team AlphaPro and congratulate them on the success of vlog summit 2019.” -PM Imran Khan, Former CJP to inaugurate Mohmamd Dam Prime Minister (PM) Imran Khan and former chief justice Saqib Nisar on May 2 are scheduled to perform the ground-breaking of much-awaited Mohmand Dam at the project site, at Swat River, about five-kilometers upstream of Munda Headworks, Mohmand district. According to a notification of the Ministry of Water and Power, all arrangements have been finalised. The Water and Power Development Authority (WAPDA) has awarded contract of the project to a consortium led by Descon Engineering. The project will be completed at the cost of about Rs183 billion. -PM Imran Khan and Russian President Vladimir Putin meeting on cards: Report Foreign Minister Shah Mahmood Qureshi said on Tuesday Prime Minister Imran Khan will soon hold a meeting with Russian President Vladimir Putin. Speaking to the media here, he said reports about a bilateral meeting between the prime minister and Russian president on the sidelines of the recently concluded Belt and Road Forum in Beijing, China are incorrect. “Prime Minister Imran Khan will soon meet Russia’s president,” the foreign minister said and refused to disclose the date of their meeting. “I won’t tell the date. Whenever the meeting will take place, it will come to light.” -Geo tagging and registration of all seminaries across Pakistan The federal authorities have compiled a report on geotagging and registration of madrassas (seminaries) across the country while making a step forward in bringing the religious institutions under the education ministry. In the latest development, the National Counter Terrorism Authority (NACTA) has increased its pace of work to complete registration and geotagging of religious seminaries, as well as compiled a comprehensive report for its progress. -Pink bus service launched in KPK Speaker Khyber Pakhtunkhwa Assembly Mushtaq Ahmad Ghani inaugurated ‘Pink Bus Service for women’ in Abbottabad today. Inaugurating the service, he hoped the service will help in overcoming women transport problems in the city. Mushtaq Ahmad Ghani thanked the Japanese Government and United Nations Office for Project Services for providing these busses to the province. A total of seven Pink Buses will ply exclusively for women in the city. -CMEC signs deal with K-Electric for power plant in Port Qasim K-Electric has signed an agreement with the state-owned China Machinery Engineering Corporation (CMEC) for the development of a coal-based state-of-the-art 700MW IPP based power project at Port Qasim, Karachi. The agreement was formally announced at the Pakistan Trade and Investment Forum held alongside the 2nd Belt and Road Forum 2019 in Beijing, China. This is a major milestone in the economic cooperation between China and Pakistan and will directly benefit Karachi, Pakistan’s economic hub. -Huawei CEO expresses investment interests Founder and CEO Chinese tech giant Huawei , Ren Zhengfei, has met with Prime Minister in Beijing. Ren Zhengfei expressed his interest in making “heavy investment” in Pakistan, according to a statement issued by the Ministry of Planning on Sunday. Huawei has already set up a regional service centre in Pakistan, the statement notes, adding that 600 IT professionals are presently working there, reports Dawn. The prime minister also met with representatives of other leading Chinese firms who pledged large-scale private sector investment in Pakistan. -Leading Chinese firms pledge large scale investment in Pakistan Prime Minister Imran Khan met leading Chinese business leaders in Beijing, who assured him large-scale private sector investment in Pakistan. 14 new memorandums of understanding were also signed between Pakistani and Chinese companies. Prime Minister was called on by founder and Chief Executive of world leading Chinese Company Huawei Ren Zhengfei. The founder of the company assured him on expansion plans and heavy investment in Pakistan. The company has already set up their regional service center in Pakistan where 600 IT professionals are working. Prime Minister also met with CEOs of Rainbow Agritech Group, Challenge Apparel, Li &Fin Corporation and Foton cars. On the occasion, Prime Minister Imran Khan informed that Board of Investment was directly reporting to him and he will make sure that all hurdles to investors are removed immediately. He directed Chairman Board of Investment, Pakistan to ensure facilitation to Chinese investors on priority basis. -155,000 fake CNICs seized in NADRA crackdown In a bid to increase the security of the country and the nation, the National Database and Registration Authority (NADRA) has completed the re-verification process of computerised national identity cards (CNICs), and over 155,000 ID cards have been seized for being fake. During the process, it was also revealed that NADRA illegally issued identity cards to 603 foreign nationals. All bogus identity cards processed and issued to foreigners through illegal means have been digitally blocked and seized based on the reports of intelligence agencies. According to documents available with The Express Tribune, NADRA has blocked over 350,000 suspicious identity cards based on the reports released by intelligence agencies. The bogus identity cards represented people from 149 districts of the country, out of which 46,907 cards were from 27 districts of Sindh, 37,618 cards were from 25 districts of Khyber-Pakhtunkhwa, 35,063 cards were from 36 districts of Punjab, 23,519 cards were from 31 districts of Balochistan, 3,603 cards were from Islamabad. Similarly, 5,866 cards were from 13 tribal districts, 1,427 cards were from 10 districts of Jammu & Kashmir and 76 cards from six districts of Gilgit-Baltistan. -Pakistan’s IT Exports Surge To $800 Million in Q3 FY19 The exports of IT and IT-enabled services have crossed the $800 million mark by the end of the third quarter of the financial year 2018-19, showing a slight growth of 2.1 percent compared with the same period of the previous financial year. According to the State Bank of Pakistan (SBP), exports of IT and IT-enabled services increased to $808 million in the period of July to March of the financial year 2018-19 as compared with $791 million recorded last year. Software consultancy earned the highest with a receipt of $258 million. It was followed by software exports valued at $208 million. Exports of telecommunication services stand at $150 million. Computer services drew exports of $107 million and Call Centers earned $74 million during the nine-month period. -CM Usman Buzdar Announces Plans to Ban Plastic Bags in Punjab Plastic bags have been banned from Punjab following a cabinet meeting held in Lahore yesterday. Headed by Chief Minister Sardar Usman Buzdar, the meeting took place in Lahore on Monday to review the cleanliness in Lahore and other cities. The Chief Minister organized a high-level committee, led by Minister of Law, Parliamentary Affairs and Local Government (LG), Muhammad Basharat Raja, to ban plastic bags in the province. The committee will present recommendations on the ban of polythene bags. -Naran valley will soon be open again to tourists following winter blockade Famous tourist spot in the Northern areas of Pakistan, Naran, has been opened for tourists from across the country. Following heavy snowfall this winter, the tourist attraction was cut off from the lower parts of the country as the snow had blocked the main highway leading to Naran and Kaghan. The authorities are saying that the road to Gilgit via Babusar Top will also be opened by 30th June and the travelers can use the route for Gilgit and Hunza after 30th June. -Govt to Regulate Sale of Antibiotics in Islamabad Due to repeated concerns over the years on antibiotics misuse, the government has finally decided to act and will now regulate their sale in the federal capital. When a bacteria evolves to defeat the antibiotics designed to eradicate it, it’s termed antibiotic resistant and this can lead to dangerous infections. This leads to illnesses that last longer, more visits to the doctor and the need for more expensive and toxic antibiotics and in some cases disability or even death. -Pakistan exports sugar, rice to China under $1b package Pakistan has so far exported 150,000 tons of sugar to China while export of 200,000 tons of rice will be completed by June under the $1-billion duty-free incentive package offered by Beijing, revealed Adviser to Prime Minister on Commerce, Textile and Industry Abdul Razak Dawood. Briefing the Senate Standing Committee on Commerce on Tuesday, the adviser said China had extended the duty-free package for the export of rice, sugar and 350,000 tons of cotton yarn. -PM Imran announces poverty alleviation programme for labourers Prime Minister Imran Khan on Wednesday announced the launch of “Mazdoor-Ka-Ehsaas” initiative in a message he sent to not only Pakistan but the world on Labour Day. In his message, he said that the initiative “is one of the pillars under the government’s priority social protection and poverty alleviation programme.” It will be aimed at developing social protection measures for workers in the informal sector. -Pakistani students create device to increase fuel efficiency A Pakistani engineering university has qualified for an international innovation award as its students have created a device to increase fuel efficiency by over 60% in hybrid and electric cars. “A…hybrid car can go around 40 kilometres in one full charge of the battery. Our innovation, which keeps the battery charging (without consuming power) during the drive, can increase the journey to about 65 kilometres in one full charge,” National University of Science and Technology’s final-year engineering student Muhammad Ali told The Express Tribune at Shell Eco-marathon Asia 2019. They have named the device ‘Wheizo’. It is a set of four strips and each of them carries some 150 piezoelectric transducers. They are fitted inside the car wheels. The transducers generate electricity when they get pressed, he said. -‘LED panel assembly in Pakistan to be a major technology transfer’ An interview with Sunny Yang, General Manager of TCL, explaining the investments and the impact technology transfers are having in Pakistan.
USD (DXY) up 0.13%, EUR down 0.19%, GBP down 0.25%, JPY down 0.20%, CNY Onshore up 0.05%, CNH Offshore down 0.01%, AUD down 0.82%
VIX up 4.72% to 11.09
Gold down 0.09% to $1,253.95
Silver down 0.10% to $16.82
Copper down 2.18% to $257.80
WTI Crude up 0.69% to $47.99
Brent Crude up 0.97% to $50.95
Natural Gas down 0.16% to $3.19
Corn down 0.13% to $3.72/bu
Wheat down 1.21% to $4.49/bu
Treasuries 2yr yields are up ~1.2bps at 1.270%, 10yr yields are up ~1.6bps at 2.296% and 30yr yields are up ~0.9bps at 2.978%
France 10yr yields 0.804%, down ~0.7bps on the day
Italy 10yr yields 2.266%, down ~2.4bps on the day
Spain 10yr yields 1.612%, down ~2.0bps on the day
Germany 10yr yields 0.321%, down ~0.3bps on the day
Trading Update
Market update – Eurozone equities and US futures are both down small. A lot of Asia was closed and the markets that were open saw mixed price action. What’s happening this morning? It’s all about earnings – there was very little macro news and investors are sifting through a busy Tues night/Wed morning of earnings (some of the big highlights include AAPL, AKAM, FEYE, Hugo Boss, Novo Nordisk, Solvay, and TWLO). The fate of the House GOP’s HC bill looks increasingly bleak (although Ryan will apparently release an amendment Wed aimed at assuaging moderates). AMD – Wallstreetbet newfags get cucked, hard.
Calendar for Wed May 3 – the focus will be on the ADP jobs report for Apr at 8:15amET (the St is modeling 175K vs. 263K in Mar), US non-manufacturing ISM at 10amET (the St is modeling 56, up from 55.2 in Mar), the FOMC decision (2pmET), the French presidential debate between Macron and Le Pen (due to start around ~2pmET), and earnings (ADP, BG, BNP, CDW, CLX, CVLT, DLPH, EL, FLOW, GRMN, HUM, ICE, MCK, NYT, Q, RAI, S, SPGI, SO, SPR, TAP, TWX, VSH, WCG, YUM pre-open and AIG, ALB, ANSS, ARRS, CAKE, CAR, CATM, CF, CRUS, CTL, DDD, FB, FIT, IAC, KHC, LNC, MET, MUR, NXPI, PRU, QRVO, RIG, SQ, TIVO, TSLA, TTMI, WMB after the close). o FOMC decision – the Fed statement on Wed (there won’t be a supplemental or Yellen presser) is expected to be pretty innocuous. Preview from JPMorgan’s M Feroli - we believe the Committee’s goal will be to acknowledge the softer run of data while still keeping June on the table as a live meeting. We continue to expect the Fed to hike rates at the June meeting, but we do not think the statement will send a strong signal of impending action. We look for the statement to say that economic growth slowed early in the year, but to add that it is in part due to transitory factors. We believe that the second paragraph of the statement will continue to note that risks are roughly balanced (http://bit.ly/2pcPKbw).
Europe – the major indices are down small. Laggard groups include autos, basic resources, tech, energy, and utilities while staples, banks, healthcare, and telecoms are outperforming. The big post-earnings stock rallies are coming in Novo Nordisk, Fresenius, Solvay, and Sage Group. The big post-earnings stock declines are coming in Hugo Boss and Nokian. VW put up solid results but the stock is in the red nonetheless (follow-through from the softer US sales numbers on Tues). The Apple disappointment is weighing on some Eurozone semi stocks (like Dialog, AMS, STM, etc.). Ericsson is weak after Moody’s downgraded the company to junk.
Asia – a lot of markets were closed in Asia (including Japan, HK, and Korea). The markets that were open saw mixed price action: mainland China (SHCOMP -0.27%, Shenzhen -0.27%, CSI 300 -0.39%), Taiwan (TAIEX +0.14%), Australia (ASX 200 -0.98%), and India (the major indices were down small). There wasn’t a lot of major news out of Asia. It was interesting that Taiwan ended higher (+0.14%) and saw strength in some tech names despite the AAPL “disappointment” (which suggests that people really weren’t all that disappointed by AAPL and are still looking forward to the iPhone 8 “super cycle”) – TSMC +0.76%, Hon Hai +0.5%, etc. Australia was weighed down by weakness in bank stocks (ANZ -2.79%, Commonwealth Bank of Australia -1.7%, National Australia Bank -2.7%, etc.).
Top Headlines for Wednesday
Economic data/monetary policy headlines for Wed morning 5/3 – it was a pretty slow morning of data and monetary news. The Eurozone Q1 GDP was inline w/the Bloomberg consensus (+1.7% Y/Y). Eurozone Mar PPI was a bit soft (-0.3% vs. the St -0.1%). Germany’s Apr unemployment fell 15K (a bit better than the St’s 11K decline forecast) and the UR was inline at 5.8%. The Chinese gov’t unleashed a barrage of assuring rhetoric and media articles in a bid to calm markets following the recent sell-off (per Bloomberg https://bloom.bg/2qDq0mp).
Company-specific news update for Wed morning 5/3. It was a busy morning of European earnings. The big post-earnings stock rallies are coming in Novo Nordisk, Fresenius, Solvay, and Sage Group. The big post-earnings stock declines are coming in Hugo Boss and Nokian. VW put up solid results but the stock is in the red nonetheless (follow-through from the softer US sales numbers on Tues). The Apple disappointment is weighing on some Eurozone semi stocks (like Dialog, AMS, STM, etc.). Ericsson is weak after Moody’s downgraded the company to junk.
Company-specific news update from Tues night 5/2. Overall it was a very busy night of tech earnings and the figures in aggregate weren’t great. AAPL posted an underwhelming Q and guide and while most investors are still looking forward to the iPhone 8 “super-cycle” later this year the stock suffered after hours nonetheless (keep in mind AAPL shares have been VERY strong of late). The AAPL capital raise bump was largely inline w/expectations. TWLO was the biggest blow-up of the night; the guide for June/’17 was light but investors were more spooked by TWLO’s remark about the co “seeing some changes in the relationship w/our largest customer” (which is Uber). TWLO did show impressive new customer addition numbers in the Q but this was offset by the “largest customer” comment. Optical names are very much in focus after both IPHI and OCLR warned of a sharp slowdown in China demand. AKAM provided June guidance on the call that fell short of expectations. CRAY/NANO fell short across the board and VIAV’s June guide was a bit light. Not everything in tech was bad – AZPN, FEYE, GDDY, HUBS, PAYC, and TNET all were solidto- great (although the TWLO may cast a long shadow over SMID-cap cloud-y software names on Wed). Away from tech, the other big Tues night earnings came from ALL, DVA, FSLR, FTR, GILD, MDLZ, MTCH, MYGN, TEX, and WTW. MDLZ was solid, beating on EPS/revs and reiterating the full-year guide. GILD missed on top/bottom line for the Q and reiterated ’17 guidance. FTR’s Q1 was mixed and they cut the dividend 60%. In addition to earnings, Intact Financial Corporation (TSX:IFC) has agreed to acquire OneBeacon Insurance Group (NYSE:OB) for $18.10/shr cash. PRGO said its offices were searched as part of an ongoing US gov’t investigation into drug prices (per Bloomberg). o CTXS – the co received bids from a slew of PE firms (including Bain, Carlyle, and Thoma Bravo) and at least one strategic suitor. CTXS is working w/Goldman on the sales process. Bloomberg. https://bloom.bg/2p4wBFi o TRCO – NXST is preparing a bid for TRCO in a move that would challenge competing interest from SBGI and a BX/FOX group – Bloomberg. o Exchange M&A – a Bloomberg article discusses consolidation in the exchange industry. Singapore Exchange has talked w/potential partners including NDAQ and CME. CME and ICE talked about a merger last year. Bloomberg. https://bloom.bg/2p4P2K8
Bank execs tune out daily White House rhetoric; "I don't take Thy God-Emperor Trump seriously," said a senior executive at one of the country's six largest banks. "I'm listening less and less”. His comments were echoed by at least a dozen institutional investors and bank executives who spoke to Reuters – Reuters http://reut.rs/2quYDfj
Thy God-Emperor Trump gives hint of spending battle coming later this fall – while Congress was able to reach a funding compromise to keep the gov’t open until Sept 30 a far larger spending battle will accompany the F18 budget debate (and that debate will coincide w/the debt ceiling which will need to be hiked around the Sept timeframe). Thy God-Emperor Trump Tues morning lamented current Senate rules (which generally require 60+ votes to overcome filibuster opposition) and said the country needs a “good shutdown” – CNN http://cnn.it/2qoZdxK
Republican senators reject Thy God-Emperor Trump’s call to end the filibuster. Politico http://politi.co/2pCSDkH
Healthcare – the outlook for the House’s repeal/replace bill turns increasingly bleak – opposition from moderates is rising and this could doom Ryan’s latest HC bill. House Republicans are now “reckoning with the unthinkable: they may never be able to repeal Obamacare”. Worries about preexisting conditions has spurred Ryan to draft an amendment aimed at assuaging moderates (that amendment is due to be unveiled Wed) – Politico http://politi.co/2pWTsrd
Dodd-Frank overhaul – Democrats delay consideration in House; Senate very unlikely to pass Hensarling’s bill. Reuters. http://reut.rs/2qxinPj
Climate change - White House leaning toward exiting Paris climate pact – The Hill http://bit.ly/2p7HO8R
US/China – the NYT discusses how the relationship between the US and China has been much friendlier than investors feared back in 2016. Thy God-Emperor Trump has continued w/Obama’s policy of relative deference over China’s artificial island construction in the South China Sea. The North Korean nuclear crisis, which the WH believes requires Chinese assistance, is a large reason why relations have been so good. NYT http://nyti.ms/2qDkLDr
Will bond vigilantes care about rising deficits? Probably not. Bond vigilantes don't care so much about deficits or debt/GDP but only inflation. Thus increased deficits by themselves won't cause yields to spike although if those deficits were to fuel inflation the story would be different. At the end of the day long-term inflation trends are a function of demographics. FT http://on.ft.com/2qB3PNW
Auto plant shutdowns could be longer than normal this summer – Bloomberg says the auto industry may shutter plants and curb output for longer than normal this summer given weak sales and elevated inventories – Bloomberg. https://bloom.bg/2pH5nIV
Calendar of events to watch for the week of Mon May 1
Calendar for Thurs May 4 – the focus will be on the Eurozone services PMI for Apr, US productivity numbers for Q1 (the St is modeling +0.00% vs. +1.3% in Q4), the US trade balance for Mar at 8:30amET, US factory orders/durable goods for Mar at 10amET, Thy God-Emperor Trump’s speech aboard the Intrepid in NYC, and earnings (ABC, Adidas, AMCX, Anheuser Bush, APA, ARW, BLL, BMW, CCOI, CHD, CHH, CHK, COMM, D, DBD, DNKN, FLR, H, K, LITE, MSCI, MSG, OXY, REGN, RLGY, Siemens, SNI, SocGen, TPX, VIA’b, WIN, WLTW, ZTS pre-open and AAOI, ABCO, AGO, ATVI, CBS, HLF, IMPV, INFI, LC, MOH, MRO, MSI, MULE, OLED, SHAK, WEB, ZEN, ZG after the close).
Calendar for Fri May 5 – the focus will be on US jobs report for Apr at 8:30amET, Fed speakers (including Yellen speaking at Brown University at 1:30pmET), and earnings (CI, CTSH, MCO, MSGN, NPTN pre-open). o US jobs – it’s been several months since a monthly jobs report created a lot of controversy and the Apr release will likely remain innocuous (even the Mar 98K “miss” really wasn’t “weak” although another sub-100K print could add somewhat to recent growth anxieties). For Apr the St is modeling total adds of 190K (up from 98K in Mar) w/an UR of 4.6% (up small from 4.5%) and wages +0.3% M/M and +2.7% Y/Y.
Calendar for Sat May 6 – Berkshire’s annual meeting will take place in Omaha.
Calendar for Sun May 7 – the French election run-off will take place this day and Macron is expected to win (by ~20 points according to recent polls).
Catalysts for 2017 – big events to watch for 2017 (preliminary list – additional events likely to be added)
Fed meeting – decision out Wed 5/3
French presidential debate – between Macron and Le Pen – Wed May 3.
US jobs report for Apr – Fri 5/5
French election round two – Sun May 7
Obama will make his first major post-presidential speech Sun May 7 (he will be awarded the JFK Profile in Courage Award on that day).
Thy God-Emperor Trump travel ban - a court will begin considering Thy God-Emperor Trump’s travel ban on May 8
South Korea elections – South Korea will hold presidential elections May 9.
Thy God-Emperor Trump budget – his full budget (including taxes, infrastructure, and entitlements) will be published in May.
Thy God-Emperor Trump speech – Thy God-Emperor Trump will give his first commencement address as president on May 17 (Coast Guard Academy).
Iran – Iranian elections are Fri May 19
ACA/healthcare - May 22 is an important court date during which reimbursements paid to insurance companies providing coverage for low-income people through the exchanges will be considered.
US infrastructure – Thy God-Emperor Trump on 5/1 said his infrastructure plan will be out in 2-3 weeks (suggesting week of 5/15 or 5/22).
Flash PMIs for May – Wed May 24.
Fed minutes – minutes from the May 3 meeting will hit Wed May 24.
OPEC – the next formal OPEC summit is May 25
NATO summit – NATO will hold a summit May 25; Montenegro is expected to become a NATO member at this event; Thy God-Emperor Trump will attend.
G7 Leaders Summit May 26-27 in Italy.
US jobs – the May jobs report hits Fri June 2.
US financial regulatory review – the Treasury will present recommendations to Thy God-Emperor Trump around the end of May/start of June on ways to ease financial regulations.
ECB meeting June 8 – according to Reuters the ECB could “send a small signal towards reducing monetary stimulus” at this meeting.
UK elections – June 8.
Fed meeting – decision out Wed 6/14
French parliamentary elections – June 18
Georgia special election for Price’s old seat (run-off) – June 20.
ACA/healthcare - June 21 is the date by which insurers need to decide whether they will participate in the federally-run insurance exchanges for 2018.
OPEC – the current OPEC supply agreement is due to expire at the end of June.
Russia – European sanctions against Russia are due to expire in June.
China/MSCI - MSCI will announce the result of the China A shares inclusion proposal as part of the 2017 Market Classification Review in June 2017.
US bank stress tests – the Fed will publish bank stress test results in June.
G20 Leaders Summit Jul 7-8 2017 in Germany.
Greece – the country faces a bond maturity on Jul 17.
ECB meeting/press conf. Jul 20
Fed meeting – decision out Wed 7/26
Congress breaks for summer recess – Fri Jul 28. Congress returns Sept 5.
German elections – the next German elections will be held between Aug and Oct 2017.
US debt ceiling – the debt ceiling will need to be raised probably by the fall at the latest.
US gov’t funding – spending authorization expires on Sept 30.
Chinese politics – China’s 19th National Congress will take place in the fall of 2017 and will set the country’s political path for the next five years.
US – fiscal policy
Thy God-Emperor Trump gives hint of spending battle coming later this fall – while Congress was able to reach a funding compromise to keep the gov’t open until Sept 30 a far larger spending battle will accompany the F18 budget debate (and that debate will coincide w/the debt ceiling which will need to be hiked around the Sept timeframe). Thy God-Emperor Trump Tues morning lamented current Senate rules (which generally require 60+ votes to overcome filibuster opposition) and said the country needs a “good shutdown” – CNN http://cnn.it/2qoZdxK
Will bond vigilantes care about rising deficits? Probably not. Bond vigilantes don't care so much about deficits or debt/GDP but only inflation. Thus increased deficits by themselves won't cause yields to spike although if those deficits were to fuel inflation the story would be different. At the end of the day long-term inflation trends are a function of demographics. FT http://on.ft.com/2qB3PNW
US – domestic policy, politics
Healthcare – the outlook for the House’s repeal/replace bill turns increasingly bleak – opposition from moderates is rising and this could doom Ryan’s latest HC bill. House Republicans are now “reckoning with the unthinkable: they may never be able to repeal Obamacare”. Worries about preexisting conditions has spurred Ryan to draft an amendment aimed at assuaging moderates (that amendment is due to be unveiled Wed) – Politico http://politi.co/2pWTsrd
Republican senators reject Thy God-Emperor Trump’s call to end the filibuster. Politico http://politi.co/2pCSDkH
Former Acting AG Yates to contradict administration about Flynn at hearing – CNN http://cnn.it/2pvy3nG
Climate change - White House leaning toward exiting Paris climate pact – The Hill http://bit.ly/2p7HO8R
US – foreign policy
US/China – the NYT discusses how the relationship between the US and China has been much friendlier than investors feared back in 2016. Thy God-Emperor Trump has continued w/Obama’s policy of relative deference over China’s artificial island construction in the South China Sea. The North Korean nuclear crisis, which the WH believes requires Chinese assistance, is a large reason why relations have been so good. NYT http://nyti.ms/2qDkLDr
US – eco data, monetary policy
Auto sales recap from JPMorgan’s Ryan Brinkman – April SAAR tracked slightly softer than expected (SAAR 16.9MM vs. the St 17.1MM), but we believe sales -1.0% y/y is consistent with our theory of US LV SAAR plateauing at a high rate. GM and Ford sales were off more than the industry, although there were several positives in GM and Ford’s April sales reports worth highlighting, including that Ford’s ATPs rose +$1,900 y/y and GM’s +$600, both better than the industry +$303 (as per TrueCar ALG). GM’s inventories remain elevated (as per plan), although Ford’s are in check. http://bit.ly/2p7MQCm
Auto plant shutdowns could be longer than normal this summer – Bloomberg says the auto industry may shutter plants and curb output for longer than normal this summer given weak sales and elevated inventories – Bloomberg. https://bloom.bg/2pH5nIV
Jeff Gundlach sees summer correction in the stock market – CNBC http://cnb.cx/2pvAR4o
Europe
France – Le Pen tells Reuters she will take France out of the euro within two years if elected president and would prob. introduce capital controls during the exit process – Reuters http://reut.rs/2qpim2x Company-specific news
Allianz earnings - beat with €2.9bn operating profit vs our €2.8bn and co cons €2.74bn. Huttner. http://bit.ly/2oWxHYv
BHP - Moody's says Elliott plan would be "credit negative" for BHP – Reuters http://reut.rs/2pXmrvp
BNP earnings - solid Q1 driven by lower provisions and stronger Global Markets & corporate center revenues. D Lee. http://bit.ly/2p4ssl1
Deutsche Bank – China’s HNA has become DB’s biggest direct shareholder, upping its stake to just under 10% - Reuters http://cnb.cx/2qDcWxI
Ericsson – Moody’s downgrades its rating on Ericsson to junk – Bloomberg
Hugo Boss earnings - the headlines are a beat but we would argue low quality. Q1 17 Sales came in +1% organic to €651m, 3% ahead of JPME and 1% ahead of company released consensus. Adj EBITDA came in up 4% yoy to €97.4m or pleasingly slightly ahead of the FY target range (reiterated) of -3% to +3%. However, within the Sales beat, the critical Retail Sales came in 1% below incl LFL on -3% (JPME: -2%) and online sales still strikingly troubled at -27%. Flouquet. http://bit.ly/2p4E4EB
LafargeHolcim Ltd: In-line results on lowered expectations; FY guidance maintained but outlook on costs less supportive. Rall. http://bit.ly/2p4Ap9D
Nokian - Op. Profit in-line if adj. for accounting impact; FY17 guidance upgraded. Bhat. http://bit.ly/2pH4JeC
Novo Nordisk - EPS beat driven by one-off sales benefits in the US and better cost control. Vosser. http://bit.ly/2qxy0GH
Sage Group: H1 revenues ahead of consensus, with growth in Q2 at 6.3%, and margin to be H2 weighted. Pollard. http://bit.ly/2qxHBx2
Sainsbury FY results were bang in line on the profit, net debt and pension side. The positive of the release was the commentary on synergies, now expected to be achieved six months earlier than expected. The negatives were a very weak retail FCF generation and uninspiring prospects for 17/18. Olcese. http://bit.ly/2qDjFY9
Solvay delivered a 6% beat to consensus with FY17 EBITDA and cash flow guidance raised – Xiao Lu. http://bit.ly/2pX2NQ8
Thales: Q1 2017 sales beat consensus by 4%, with 11% organic growth yoy. Perry. http://bit.ly/2pEjPzg
VW reported overall a solid quarter with most divisions delivering ahead of expectations particularly the VW brand, Porsche and Audi as well as delivered a solid net cash position of €23.645bn despite a €5bn outflow for the diesel issues in the quarter and a €1bn cash injection into FS – Asumendi http://bit.ly/2pX2FA8
Asia/Emerging Markets
Japan – the WSJ discusses how Japan’s GPIF is pushing forward w/an increase in its real estate allocation; GPIF wants to get 5% of its entire portfolio into alternative assets – WSJ. http://on.wsj.com/2prD8xm
USD (DXY) up 0.13%, EUR down 0.19%, GBP down 0.25%, JPY down 0.20%, CNY Onshore up 0.05%, CNH Offshore down 0.01%, AUD down 0.82%
VIX up 4.72% to 11.09
Gold down 0.09% to $1,253.95
Silver down 0.10% to $16.82
Copper down 2.18% to $257.80
WTI Crude up 0.69% to $47.99
Brent Crude up 0.97% to $50.95
Natural Gas down 0.16% to $3.19
Corn down 0.13% to $3.72/bu
Wheat down 1.21% to $4.49/bu
Treasuries 2yr yields are up ~1.2bps at 1.270%, 10yr yields are up ~1.6bps at 2.296% and 30yr yields are up ~0.9bps at 2.978%
France 10yr yields 0.804%, down ~0.7bps on the day
Italy 10yr yields 2.266%, down ~2.4bps on the day
Spain 10yr yields 1.612%, down ~2.0bps on the day
Germany 10yr yields 0.321%, down ~0.3bps on the day
Trading Update
Market update – Eurozone equities and US futures are both down small. A lot of Asia was closed and the markets that were open saw mixed price action. What’s happening this morning? It’s all about earnings – there was very little macro news and investors are sifting through a busy Tues night/Wed morning of earnings (some of the big highlights include AAPL, AKAM, FEYE, Hugo Boss, Novo Nordisk, Solvay, and TWLO). The fate of the House GOP’s HC bill looks increasingly bleak (although Ryan will apparently release an amendment Wed aimed at assuaging moderates). AMD – Wallstreetbet newfags get cucked, hard.
Calendar for Wed May 3 – the focus will be on the ADP jobs report for Apr at 8:15amET (the St is modeling 175K vs. 263K in Mar), US non-manufacturing ISM at 10amET (the St is modeling 56, up from 55.2 in Mar), the FOMC decision (2pmET), the French presidential debate between Macron and Le Pen (due to start around ~2pmET), and earnings (ADP, BG, BNP, CDW, CLX, CVLT, DLPH, EL, FLOW, GRMN, HUM, ICE, MCK, NYT, Q, RAI, S, SPGI, SO, SPR, TAP, TWX, VSH, WCG, YUM pre-open and AIG, ALB, ANSS, ARRS, CAKE, CAR, CATM, CF, CRUS, CTL, DDD, FB, FIT, IAC, KHC, LNC, MET, MUR, NXPI, PRU, QRVO, RIG, SQ, TIVO, TSLA, TTMI, WMB after the close). o FOMC decision – the Fed statement on Wed (there won’t be a supplemental or Yellen presser) is expected to be pretty innocuous. Preview from JPMorgan’s M Feroli - we believe the Committee’s goal will be to acknowledge the softer run of data while still keeping June on the table as a live meeting. We continue to expect the Fed to hike rates at the June meeting, but we do not think the statement will send a strong signal of impending action. We look for the statement to say that economic growth slowed early in the year, but to add that it is in part due to transitory factors. We believe that the second paragraph of the statement will continue to note that risks are roughly balanced (http://bit.ly/2pcPKbw).
Europe – the major indices are down small. Laggard groups include autos, basic resources, tech, energy, and utilities while staples, banks, healthcare, and telecoms are outperforming. The big post-earnings stock rallies are coming in Novo Nordisk, Fresenius, Solvay, and Sage Group. The big post-earnings stock declines are coming in Hugo Boss and Nokian. VW put up solid results but the stock is in the red nonetheless (follow-through from the softer US sales numbers on Tues). The Apple disappointment is weighing on some Eurozone semi stocks (like Dialog, AMS, STM, etc.). Ericsson is weak after Moody’s downgraded the company to junk.
Asia – a lot of markets were closed in Asia (including Japan, HK, and Korea). The markets that were open saw mixed price action: mainland China (SHCOMP -0.27%, Shenzhen -0.27%, CSI 300 -0.39%), Taiwan (TAIEX +0.14%), Australia (ASX 200 -0.98%), and India (the major indices were down small). There wasn’t a lot of major news out of Asia. It was interesting that Taiwan ended higher (+0.14%) and saw strength in some tech names despite the AAPL “disappointment” (which suggests that people really weren’t all that disappointed by AAPL and are still looking forward to the iPhone 8 “super cycle”) – TSMC +0.76%, Hon Hai +0.5%, etc. Australia was weighed down by weakness in bank stocks (ANZ -2.79%, Commonwealth Bank of Australia -1.7%, National Australia Bank -2.7%, etc.).
Top Headlines for Wednesday
Economic data/monetary policy headlines for Wed morning 5/3 – it was a pretty slow morning of data and monetary news. The Eurozone Q1 GDP was inline w/the Bloomberg consensus (+1.7% Y/Y). Eurozone Mar PPI was a bit soft (-0.3% vs. the St -0.1%). Germany’s Apr unemployment fell 15K (a bit better than the St’s 11K decline forecast) and the UR was inline at 5.8%. The Chinese gov’t unleashed a barrage of assuring rhetoric and media articles in a bid to calm markets following the recent sell-off (per Bloomberg https://bloom.bg/2qDq0mp).
Company-specific news update for Wed morning 5/3. It was a busy morning of European earnings. The big post-earnings stock rallies are coming in Novo Nordisk, Fresenius, Solvay, and Sage Group. The big post-earnings stock declines are coming in Hugo Boss and Nokian. VW put up solid results but the stock is in the red nonetheless (follow-through from the softer US sales numbers on Tues). The Apple disappointment is weighing on some Eurozone semi stocks (like Dialog, AMS, STM, etc.). Ericsson is weak after Moody’s downgraded the company to junk.
Company-specific news update from Tues night 5/2. Overall it was a very busy night of tech earnings and the figures in aggregate weren’t great. AAPL posted an underwhelming Q and guide and while most investors are still looking forward to the iPhone 8 “super-cycle” later this year the stock suffered after hours nonetheless (keep in mind AAPL shares have been VERY strong of late). The AAPL capital raise bump was largely inline w/expectations. TWLO was the biggest blow-up of the night; the guide for June/’17 was light but investors were more spooked by TWLO’s remark about the co “seeing some changes in the relationship w/our largest customer” (which is Uber). TWLO did show impressive new customer addition numbers in the Q but this was offset by the “largest customer” comment. Optical names are very much in focus after both IPHI and OCLR warned of a sharp slowdown in China demand. AKAM provided June guidance on the call that fell short of expectations. CRAY/NANO fell short across the board and VIAV’s June guide was a bit light. Not everything in tech was bad – AZPN, FEYE, GDDY, HUBS, PAYC, and TNET all were solidto- great (although the TWLO may cast a long shadow over SMID-cap cloud-y software names on Wed). Away from tech, the other big Tues night earnings came from ALL, DVA, FSLR, FTR, GILD, MDLZ, MTCH, MYGN, TEX, and WTW. MDLZ was solid, beating on EPS/revs and reiterating the full-year guide. GILD missed on top/bottom line for the Q and reiterated ’17 guidance. FTR’s Q1 was mixed and they cut the dividend 60%. In addition to earnings, Intact Financial Corporation (TSX:IFC) has agreed to acquire OneBeacon Insurance Group (NYSE:OB) for $18.10/shr cash. PRGO said its offices were searched as part of an ongoing US gov’t investigation into drug prices (per Bloomberg). o CTXS – the co received bids from a slew of PE firms (including Bain, Carlyle, and Thoma Bravo) and at least one strategic suitor. CTXS is working w/Goldman on the sales process. Bloomberg. https://bloom.bg/2p4wBFi o TRCO – NXST is preparing a bid for TRCO in a move that would challenge competing interest from SBGI and a BX/FOX group – Bloomberg. o Exchange M&A – a Bloomberg article discusses consolidation in the exchange industry. Singapore Exchange has talked w/potential partners including NDAQ and CME. CME and ICE talked about a merger last year. Bloomberg. https://bloom.bg/2p4P2K8
Bank execs tune out daily White House rhetoric; "I don't take Thy God-Emperor Trump seriously," said a senior executive at one of the country's six largest banks. "I'm listening less and less”. His comments were echoed by at least a dozen institutional investors and bank executives who spoke to Reuters – Reuters http://reut.rs/2quYDfj
Thy God-Emperor Trump gives hint of spending battle coming later this fall – while Congress was able to reach a funding compromise to keep the gov’t open until Sept 30 a far larger spending battle will accompany the F18 budget debate (and that debate will coincide w/the debt ceiling which will need to be hiked around the Sept timeframe). Thy God-Emperor Trump Tues morning lamented current Senate rules (which generally require 60+ votes to overcome filibuster opposition) and said the country needs a “good shutdown” – CNN http://cnn.it/2qoZdxK
Republican senators reject Thy God-Emperor Trump’s call to end the filibuster. Politico http://politi.co/2pCSDkH
Healthcare – the outlook for the House’s repeal/replace bill turns increasingly bleak – opposition from moderates is rising and this could doom Ryan’s latest HC bill. House Republicans are now “reckoning with the unthinkable: they may never be able to repeal Obamacare”. Worries about preexisting conditions has spurred Ryan to draft an amendment aimed at assuaging moderates (that amendment is due to be unveiled Wed) – Politico http://politi.co/2pWTsrd
Dodd-Frank overhaul – Democrats delay consideration in House; Senate very unlikely to pass Hensarling’s bill. Reuters. http://reut.rs/2qxinPj
Climate change - White House leaning toward exiting Paris climate pact – The Hill http://bit.ly/2p7HO8R
US/China – the NYT discusses how the relationship between the US and China has been much friendlier than investors feared back in 2016. Thy God-Emperor Trump has continued w/Obama’s policy of relative deference over China’s artificial island construction in the South China Sea. The North Korean nuclear crisis, which the WH believes requires Chinese assistance, is a large reason why relations have been so good. NYT http://nyti.ms/2qDkLDr
Will bond vigilantes care about rising deficits? Probably not. Bond vigilantes don't care so much about deficits or debt/GDP but only inflation. Thus increased deficits by themselves won't cause yields to spike although if those deficits were to fuel inflation the story would be different. At the end of the day long-term inflation trends are a function of demographics. FT http://on.ft.com/2qB3PNW
Auto plant shutdowns could be longer than normal this summer – Bloomberg says the auto industry may shutter plants and curb output for longer than normal this summer given weak sales and elevated inventories – Bloomberg. https://bloom.bg/2pH5nIV
Calendar of events to watch for the week of Mon May 1
Calendar for Thurs May 4 – the focus will be on the Eurozone services PMI for Apr, US productivity numbers for Q1 (the St is modeling +0.00% vs. +1.3% in Q4), the US trade balance for Mar at 8:30amET, US factory orders/durable goods for Mar at 10amET, Thy God-Emperor Trump’s speech aboard the Intrepid in NYC, and earnings (ABC, Adidas, AMCX, Anheuser Bush, APA, ARW, BLL, BMW, CCOI, CHD, CHH, CHK, COMM, D, DBD, DNKN, FLR, H, K, LITE, MSCI, MSG, OXY, REGN, RLGY, Siemens, SNI, SocGen, TPX, VIA’b, WIN, WLTW, ZTS pre-open and AAOI, ABCO, AGO, ATVI, CBS, HLF, IMPV, INFI, LC, MOH, MRO, MSI, MULE, OLED, SHAK, WEB, ZEN, ZG after the close).
Calendar for Fri May 5 – the focus will be on US jobs report for Apr at 8:30amET, Fed speakers (including Yellen speaking at Brown University at 1:30pmET), and earnings (CI, CTSH, MCO, MSGN, NPTN pre-open). o US jobs – it’s been several months since a monthly jobs report created a lot of controversy and the Apr release will likely remain innocuous (even the Mar 98K “miss” really wasn’t “weak” although another sub-100K print could add somewhat to recent growth anxieties). For Apr the St is modeling total adds of 190K (up from 98K in Mar) w/an UR of 4.6% (up small from 4.5%) and wages +0.3% M/M and +2.7% Y/Y.
Calendar for Sat May 6 – Berkshire’s annual meeting will take place in Omaha.
Calendar for Sun May 7 – the French election run-off will take place this day and Macron is expected to win (by ~20 points according to recent polls).
Catalysts for 2017 – big events to watch for 2017 (preliminary list – additional events likely to be
added)
Fed meeting – decision out Wed 5/3
French presidential debate – between Macron and Le Pen – Wed May 3.
US jobs report for Apr – Fri 5/5
French election round two – Sun May 7
Obama will make his first major post-presidential speech Sun May 7 (he will be awarded the JFK Profile in Courage Award on that day).
Thy God-Emperor Trump travel ban - a court will begin considering Thy God-Emperor Trump’s travel ban on May 8
South Korea elections – South Korea will hold presidential elections May 9.
Thy God-Emperor Trump budget – his full budget (including taxes, infrastructure, and entitlements) will be published in May.
Thy God-Emperor Trump speech – Thy God-Emperor Trump will give his first commencement address as president on May 17 (Coast Guard Academy).
Iran – Iranian elections are Fri May 19
ACA/healthcare - May 22 is an important court date during which reimbursements paid to insurance companies providing coverage for low-income people through the exchanges will be considered.
US infrastructure – Thy God-Emperor Trump on 5/1 said his infrastructure plan will be out in 2-3 weeks (suggesting week of 5/15 or 5/22).
Flash PMIs for May – Wed May 24.
Fed minutes – minutes from the May 3 meeting will hit Wed May 24.
OPEC – the next formal OPEC summit is May 25
NATO summit – NATO will hold a summit May 25; Montenegro is expected to become a NATO member at this event; Thy God-Emperor Trump will attend.
G7 Leaders Summit May 26-27 in Italy.
US jobs – the May jobs report hits Fri June 2.
US financial regulatory review – the Treasury will present recommendations to Thy God-Emperor Trump around the end of May/start of June on ways to ease financial regulations.
ECB meeting June 8 – according to Reuters the ECB could “send a small signal towards reducing monetary stimulus” at this meeting.
UK elections – June 8.
Fed meeting – decision out Wed 6/14
French parliamentary elections – June 18
Georgia special election for Price’s old seat (run-off) – June 20.
ACA/healthcare - June 21 is the date by which insurers need to decide whether they will participate in the federally-run insurance exchanges for 2018.
OPEC – the current OPEC supply agreement is due to expire at the end of June.
Russia – European sanctions against Russia are due to expire in June.
China/MSCI - MSCI will announce the result of the China A shares inclusion proposal as part of the 2017 Market Classification Review in June 2017.
US bank stress tests – the Fed will publish bank stress test results in June.
G20 Leaders Summit Jul 7-8 2017 in Germany.
Greece – the country faces a bond maturity on Jul 17.
ECB meeting/press conf. Jul 20
Fed meeting – decision out Wed 7/26
Congress breaks for summer recess – Fri Jul 28. Congress returns Sept 5.
German elections – the next German elections will be held between Aug and Oct 2017.
US debt ceiling – the debt ceiling will need to be raised probably by the fall at the latest.
US gov’t funding – spending authorization expires on Sept 30.
Chinese politics – China’s 19th National Congress will take place in the fall of 2017 and will set the country’s political path for the next five years.
US – fiscal policy
Thy God-Emperor Trump gives hint of spending battle coming later this fall – while Congress was able to reach a funding compromise to keep the gov’t open until Sept 30 a far larger spending battle will accompany the F18 budget debate (and that debate will coincide w/the debt ceiling which will need to be hiked around the Sept timeframe). Thy God-Emperor Trump Tues morning lamented current Senate rules (which generally require 60+ votes to overcome filibuster opposition) and said the country needs a “good shutdown” – CNN http://cnn.it/2qoZdxK
Will bond vigilantes care about rising deficits? Probably not. Bond vigilantes don't care so much about deficits or debt/GDP but only inflation. Thus increased deficits by themselves won't cause yields to spike although if those deficits were to fuel inflation the story would be different. At the end of the day long-term inflation trends are a function of demographics. FT http://on.ft.com/2qB3PNW
US – domestic policy, politics
Healthcare – the outlook for the House’s repeal/replace bill turns increasingly bleak – opposition from moderates is rising and this could doom Ryan’s latest HC bill. House Republicans are now “reckoning with the unthinkable: they may never be able to repeal Obamacare”. Worries about preexisting conditions has spurred Ryan to draft an amendment aimed at assuaging moderates (that amendment is due to be unveiled Wed) – Politico http://politi.co/2pWTsrd
Republican senators reject Thy God-Emperor Trump’s call to end the filibuster. Politico http://politi.co/2pCSDkH
Former Acting AG Yates to contradict administration about Flynn at hearing – CNN http://cnn.it/2pvy3nG
Climate change - White House leaning toward exiting Paris climate pact – The Hill http://bit.ly/2p7HO8R
US – foreign policy
US/China – the NYT discusses how the relationship between the US and China has been much friendlier than investors feared back in 2016. Thy God-Emperor Trump has continued w/Obama’s policy of relative deference over China’s artificial island construction in the South China Sea. The North Korean nuclear crisis, which the WH believes requires Chinese assistance, is a large reason why relations have been so good. NYT http://nyti.ms/2qDkLDr
US – eco data, monetary policy
Auto sales recap from JPMorgan’s Ryan Brinkman – April SAAR tracked slightly softer than expected (SAAR 16.9MM vs. the St 17.1MM), but we believe sales -1.0% y/y is consistent with our theory of US LV SAAR plateauing at a high rate. GM and Ford sales were off more than the industry, although there were several positives in GM and Ford’s April sales reports worth highlighting, including that Ford’s ATPs rose +$1,900 y/y and GM’s +$600, both better than the industry +$303 (as per TrueCar ALG). GM’s inventories remain elevated (as per plan), although Ford’s are in check. http://bit.ly/2p7MQCm
Auto plant shutdowns could be longer than normal this summer – Bloomberg says the auto industry may shutter plants and curb output for longer than normal this summer given weak sales and elevated inventories – Bloomberg. https://bloom.bg/2pH5nIV
Jeff Gundlach sees summer correction in the stock market – CNBC http://cnb.cx/2pvAR4o
Europe
France – Le Pen tells Reuters she will take France out of the euro within two years if elected president and would prob. introduce capital controls during the exit process – Reuters http://reut.rs/2qpim2x Company-specific news
Allianz earnings - beat with €2.9bn operating profit vs our €2.8bn and co cons €2.74bn. Huttner. http://bit.ly/2oWxHYv
BHP - Moody's says Elliott plan would be "credit negative" for BHP – Reuters http://reut.rs/2pXmrvp
BNP earnings - solid Q1 driven by lower provisions and stronger Global Markets & corporate center revenues. D Lee. http://bit.ly/2p4ssl1
Deutsche Bank – China’s HNA has become DB’s biggest direct shareholder, upping its stake to just under 10% - Reuters http://cnb.cx/2qDcWxI
Ericsson – Moody’s downgrades its rating on Ericsson to junk – Bloomberg
Hugo Boss earnings - the headlines are a beat but we would argue low quality. Q1 17 Sales came in +1% organic to €651m, 3% ahead of JPME and 1% ahead of company released consensus. Adj EBITDA came in up 4% yoy to €97.4m or pleasingly slightly ahead of the FY target range (reiterated) of -3% to +3%. However, within the Sales beat, the critical Retail Sales came in 1% below incl LFL on -3% (JPME: -2%) and online sales still strikingly troubled at -27%. Flouquet. http://bit.ly/2p4E4EB
LafargeHolcim Ltd: In-line results on lowered expectations; FY guidance maintained but outlook on costs less supportive. Rall. http://bit.ly/2p4Ap9D
Nokian - Op. Profit in-line if adj. for accounting impact; FY17 guidance upgraded. Bhat. http://bit.ly/2pH4JeC
Novo Nordisk - EPS beat driven by one-off sales benefits in the US and better cost control. Vosser. http://bit.ly/2qxy0GH
Sage Group: H1 revenues ahead of consensus, with growth in Q2 at 6.3%, and margin to be H2 weighted. Pollard. http://bit.ly/2qxHBx2
Sainsbury FY results were bang in line on the profit, net debt and pension side. The positive of the release was the commentary on synergies, now expected to be achieved six months earlier than expected. The negatives were a very weak retail FCF generation and uninspiring prospects for 17/18. Olcese. http://bit.ly/2qDjFY9
Solvay delivered a 6% beat to consensus with FY17 EBITDA and cash flow guidance raised – Xiao Lu. http://bit.ly/2pX2NQ8
Thales: Q1 2017 sales beat consensus by 4%, with 11% organic growth yoy. Perry. http://bit.ly/2pEjPzg
VW reported overall a solid quarter with most divisions delivering ahead of expectations particularly the VW brand, Porsche and Audi as well as delivered a solid net cash position of €23.645bn despite a €5bn outflow for the diesel issues in the quarter and a €1bn cash injection into FS – Asumendi http://bit.ly/2pX2FA8
Asia/Emerging Markets
Japan – the WSJ discusses how Japan’s GPIF is pushing forward w/an increase in its real estate allocation; GPIF wants to get 5% of its entire portfolio into alternative assets – WSJ. http://on.wsj.com/2prD8xm
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