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Asia
Asian equity markets traded positive supported by Chinese GDP figures which printed in-line with estimates at 7.5% Y/Y and alleviated fears that GDP growth may fall near the 7.0% level. This saw equities move higher across the region and the ASX 200 returning into positive territory, underpinned by Australia’s large exposure to the Chinese economy. In individual stock news, Linc Energy shares are the best performing as energy related stocks benefit from plans announced by Treasurer Chris Bowen to accelerate Australia’s move to emissions trading as clean-energy policy, which would lower companies’ costs to an estimated floating price of USD 6.00-10.00 per tonne of carbon pollution from the current fixed USD 24.15 per tonne. The KOSPI underperformed and traded in the red, whilst the Nikkei 225 remained closed for Marine Day holiday. (RANsquawk)
Toshiba – Toshiba Plant Systems Services Corp. won a JPY 20bln solar plant order. (Nikkei)
Mazda – Co. plans to boost North America vehicle sales 11% to 410,000 units in FY 2013 and is to sell Diesel Atenza in the region. (Nikkei)
FTSE
Rio Tinto – Co.’s Alcan unit receives binding offer for its St. Jean-De-Maurienne aluminium smelter and Castelsarrasin casting facility in France. (Newswires)
Shell – Nigeria LNG, of which Co. owns 25.6%, has lost USD 475mln in revenues from Nigerian Maritime Administration and Safety Agency (NIMASA) blockade of its ships, according to a company statement. NIMASA had been blocking ships over a dispute on unpaid levies. (Newswires)
Lloyds – The UK is to start selling its shares in the Co. to pension funds and insurers later this year, rejecting interest from private equity and sovereign wealth funds, according to industry sources. The government could sell a quarter of of its 39% stake as early as September, the sources said. (Newswires)
G4S/Serco – The British government has said it will not be awarding outsourcing contracts to either company until they receive a clean bill of health from the review into public service provision; follows news the companies had charged for electronically tagging criminals who were either dead, in prison or never tagged in the first place. (Newswires)
G4S – Co. has held talks with large investors about the prospects for tapping them for cash, a spokesman for the company said on Sunday. (Newswires) The new CEO Almanza has ordered a sweeping review of the Co. which could prompt a rights issue within weeks. (Sunday Times)
Centrica – Co. may halt a GBP 1.4bln plan to convert an empty gas field into storage. (Sunday Telegraph)
Reckitt Benckiser – CVS Caremark has removed one of the Co.’s heroin replacement drugs from its approved list of medications. (Independent)
ARM Holdings – Co. is planning a fight back against claims that Intel’s new technology threatens its main smartphone business. (Independent)
Vodafone – Co. will warn, when it reports on Friday, that the economic slump continues to exact a heavy toll on its businesses in southern Europe. (Sunday Times)
Glaxo/AG Barr – FTSE 250 listed AG Barr is weighing a GBP 1bln bid for Glaxo’s Lucozade and Ribena brands. (Sunday Times)
GSK – Chinese police said 4 senior Chinese GSK executives have been detained and that GSK broke the law to boost sale prices. (Newswires) An unidentified official at China’s Public Security Ministry said the probe into bribery allegations at the co. forms part of a wider push to further rectify and regulate the drugs industry. (People’s Daily)
UK banking sector – Rebel bondholders in the Co-op are threatening to derail plans to bail out the business. The investors say the group should cut its bank adrift rather than plough in cash that could be used elsewhere. (Sunday Times)
AstraZeneca – CFO Simon Lowth to leave the co. and join BG Group at end of October. (Newswires)
Vedanta – Co. to seek renewed shareholder approval for share buyback. (economictimes.indiatimes.com)
OTHER UK COMPANIES
Invensys – General Electric is thought to be raising a bid which could be as high as GBP 5.50 per share, or GBP 3.5bln, trumping Schneider Electrics bid of GBP 5.05. (Sunday Times)
Gulf Keystone – The board rejected a slate of new directors proposed by rebel shareholders. The rebuff is a serious escalation of the fight between the company and the rebels. (Sunday Times)
Co-Operative Group – Co. has proposal to fill GBP 1.5bln hole in banking unit by injecting GBP 1bln itself and forcing bondholders to take GBP 500mln loss on GBP 1.3bln investment. (Telegraph)
Interserve – Co. says Topaz Oil deal to be EPS accretive. (Newswires)
Companies paying dividend: UTV Media (GBP 0.0583)
Companies going ex-dividend: Aveva Group (GBP 1.6333)
DAX
Commerzbank – Germany met with UBS to discuss selling the government’s stake in the co. according to reports. Germany’s finance minister Wolfgang Schaeuble spoke to co. Chairman Weber according to the report in Focus. (Focus)
Deutsche Telekom – Co. is to double internet speed in 44 cities. (Focus)
OTHER GERMAN
Kloeckner – CFO says co. faces loss in 2013. (Boersenzeitung)
Aareal Bank – CFO says wants to return to active dividend policy for 2013. (FAS)
CAC
Total – Co. says Q2 operating margins at USD 102.4/bbl vs. 112.6/bbl in Q1. (Newswires)
Michelin – Co. has issued a voluntary safety recall of 100,000 tires. Reason for recalling is partial or full sidewall perforations although no deaths, injuries or accidents have been reported. (Newswires)
EDF – Germany’s Trimet says the Co. is to have a minority holding in Rio Tinto‘s two French smelters after submitting a binding offer for the two smelters. (Newswires)
L’Oreal – Bernstein says co.’s Q2 earnings won’t be enough for outperformance. Bernstein expects the co.’s LFL growth to be inline with Q1. (Newswires)
Companies paying dividend: ArcelorMittal (EUR 0.20)
Pan-European
Italian Banks – SP has placed 23 Italian banks on watch negative and cut 9 Italian banks to BBB from BBB+. Intesa Sanpaolo, Mediobanca and UniCredit are among the 9 banks cut by SP. (Newswires)
Fiat Industrial – Co. says withdrawal price for CNH merger EUR 8.897/share. (Newswires)
Monte Paschi – Italy’s court rejects Co.’s prosecutors appeal on Nomura asset seizure request. (ANSA)
Elan – First round bids for the company are due this week, according to sources. Allergan and Forest Laboratories are two companies still involved in the auction. (Newswires)
Eni – Co. may reduce its stake in the Cyprus gas project to 45%-50% from the current 80%. (Corriere della Sera)
Eurobank – Greece’s Eurobank is expected to acquire small lender New Hellenic Postbank. (Newswires)
Colruyt – Family board member Piet Colruyt sold 30,000 shares for average EUR 41.48 apiece, according to regulatory filing. (Newswires)
Red Electrica – Co. estimates impact of energy reforms at EUR 100mln. (Newswires)
Telefonica – Co. prepares 4G mobile broadband network. (Expansion)
Companies paying dividend: Voestalpine (EUR 0.90)
Companies going ex-dividend: Banco Santander (EUR 0.15)
SMI
Roche – Co. is said to seek financing for potential takeover bid of Alexion. Citi have commented that Alexion may not be the “deal of choice” for the co. (Newswires) Meanwhile, co. has been given EU approval for Erivedge for treatment of BCC. (Newswires)
UBS – German finance minister Schaeuble talked to Co. chairman Weber to evaluate interest in buying the state’s Commerzbank shares. (Newswires)
OTHER SWISS
Kuehne and Nagel – Q2 Ebitda CHF 247mln VS. Exp. CHF 246mln. Net income CHF 153mln vs. Prev. CHF 144mln. (Newswires)
Scandinavia
SEB – Q2 net income rises to SEK 3.79bln vs. Exp. SEK 3.21bln. Q2 net interest income SEK 4.68bln vs. Prev. 4.53bln. (Newswires)
Swedish Match – Berenberg says deal would be difficult financially with Imperial Tobacco, which currently has a BBB/Baa3 credit rating; says combined group rating may be downgraded to junk. (Newswires)
HM – June LFL sales in line with expectations; June total sales up 13% vs. Exp up 13%. June same store sales up 3% vs. Exp. up 3%. (Newswires)
Global
Solar Names – Talks to resolve a multibillion-dollar trade dispute between the EU and China over solar panels have reached an impasse, according to EU officials. The deadline is in a number of weeks and if a deal is not met EU import tariffs on solar energy gear will spike. (Newswires)
Broker Recommendations
TULLOW OIL CUT TO HOLD VS BUY AT SOCGEN
CAP GEMINI RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
AIR FRANCE CUT TO NEUTRAL VS OVERWEIGHT AT HSBC
DAIMLER RAISED TO BUY VS NEUTRAL AT ODDO
KABEL DEUTSCHLAND CUT TO NEUTRAL VS OVERWEIGHT AT HSBC
MONDI CUT TO UNDERPERFORM VS NEUTRAL AT BOFAML
SCANIA CUT TO HOLD VS BUY AT NORDEA
ELISA CUT TO HOLD VS BUY AT NORDEA
NORSK HYDRO CUT TO HOLD VS BUY AT SEB
JP MORGAN ADVISES ADDING TO EUROPE WEIGHT, UPGRADES TO OVERWEIGHT
Friday’s Largest Block Trades
Swedish Match Aug-13 280C block of 1125 bought
EADS Aug-13 38P two blocks of 1250 bought
Aegon Dec-13 3.6P block of 30k bought
US
US equity markets closed mixed on Friday with the NASDAQ 100 the stronger of the three indices and the DJIA the weakest. The NASDAQ 100 was boosted by news that Roche is said to seek financing for a potential Alexion takeover bid. This saw Alexion shares move over 23% higher at one point before closing the session up around 15%. This also supported other Biotechnology names with Ariad Pharmaceuticals up 10% and Biomarin Pharmaceuticals up 11%. The DJIA was weighed upon by its 5th largest component, Boeing, whose shares were down as much as 7% at one stage before closing the session lower by around 5%. This followed news that an incident occurred with a Boeing 787 Dreamliner at London’s Heathrow airport, involving fire crews. Finally, DJIA closed down 0.01% at 15460.76, SP 500 up 0.29% at 1679.97 and NASDAQ 100 up 0.64% at 3079.07.
Best Performing Sectors in the SP 500: Financials (+0.75%), Health Care (+0.70%), Consumer Services (+0.55%)
Worst Performing Sectors in the SP 500: Telecommunications (-0.59%), Industrials (-0.44%), Basic Materials (-0.44%)
Boeing – British investigators said “there is no evidence” that lithium-ion batteries caused the fire that damaged a parked Ethiopian Airlines Boeing 787 at London’s Heathrow International Airport on Friday, but they didn’t indicate what may have sparked the flames. Elsewhere, Ethiopia Airlines says won’t ground Boeing 787s. (WSJ)
General Electric – Co. is thought to be raising a bid for Invensys which could be as high as GBP 5.50 per share, trumping Schneider Electrics bid of GBP 5.05. (Sunday Times)
Dell – Co.’s special committee recommends holders vote for Michael Dell and Silver Lake USD 13.65 offer. Said still the Co. is still reviewing Icahn’s fifth proposal and remains willing to meet and talk with Icahn. (Newswires)
Apple – Co. is to probe reports of iPhone electric shock death. (Newswires)
Banks – Moody’s said the US leverage plan is credit positive for banks. (Newswires)
You can now follow real-time news headlines on the move with the new RANsquawk app available to download for free at ransquawk.com/mobile_app for Apple iPhone, Blackberry and Android users. Please note the headlines can be viewed on the app between 0630BST/0030CST to 2200BST/1600CST Monday to Friday but does not include Asian-Pacific news.