InPlay from Briefing.com

6:31 pm Impax Labs issues voluntary nationwide retail level recall for one lot of Lamotrigine Orally Disintegrating Tablet 200 mg (IPXL) : Unit-of-use blister packs (a 10 count blister card contained in a single plastic shell-pack) may contain 100 mg product instead of 200 mg product.

5:46 pm Consolidated Water discloses the signing of a public-private partnership contract for the Rosarito, Mexico desalination plant (CWCO) :

The co announced that on August 22, 2016 the State of Baja California, Mexico signed a public-private partnership contract with Aguas de Rosarito S.A.P.I. de C.V., the special purpose project company owned by NuWater S.A.P.I. de C.V. and N.S.C. Agua, S.A. de C.V. (the Company's subsidiary) for the design, construction, financing, and operation of a seawater desalination plant in Playas de Rosarito, Baja California, Mexico. Degremont S.A. de C.V., a subsidiary of Suez Environmental of France has been selected by AdR to design and construct the Project.

  • The APP Contract was executed between AdR, the State Water Commission of Baja California, the Government of Baja California represented by the Secretary of Planning and Finance, and the Public Utilities Commission of Tijuana. The APP Contract requires AdR to design, construct, finance and operate a seawater desalination plant (and accompanying aqueducts) with a capacity of up to 100 million gallons per day in two phases: the first with a capacity of 50 million gallons per day and an aqueduct to the Mexican potable water system in Tijuana, Baja California; and the second phase with a capacity of 50 million gallons per day and an aqueduct to a second delivery point in Tijuana. The first phase must be operational within 36 months of commencing construction, and the second phase must be operational by the end of 2024. The APP Contract further requires AdR to operate and maintain the plant and aqueducts for a period of 37 years starting from the commencement of operation of the first phase. At the end of the operating period the plant and aqueducts will be transferred to CEA.
  • The total Project cost is expected to be approximately 9 billion Mexican pesos, or approximately US$490 million (based upon the currency exchange rate as of August 23, 2016). Annual revenues from the Project are expected to be approximately 1.02 billion Mexican pesos, or approximately US$55.5 million (based upon the currency exchange rate as of August 23, 2016). Water rates under the APP Contract are indexed to the Mexican national consumer price index over its term. Electrical energy costs incurred by AdR to desalinate and deliver water are treated as a pass through charge to CEA, subject to efficiency guarantees. AdR expects to raise Mexican peso denominated debt financing through a consortium led by the North American Development Bank, which also provided financial advisory services to the Company and its partners through the bidding process and contract negotiations.

5:37 pm Herbalife issues statement responding to Icahn's disclosure that he purchased an additional 2.3 mln shares (HLF) : "We appreciate the support of all of our investors and are particularly grateful to Carl Icahn and the conviction he shares, and continues to show in our business, as demonstrated by today's significant increase in his stake in the Company," said Michael O. Johnson, chairman and CEO, Herbalife.

4:51 pm Kayne Anderson to redeem all 2 mln shares of its Series G Mandatory Redeemable Preferred Shares with an aggregate liquidation preference of $50 mln on October 3 (KYN) :  

4:43 pm Atlas Resource Partners receives court approval of its prepackaged restructuring, expects to emerge as Titan Energy, LLC on September 1 pursuant to the Prepackaged Plan. (ARPJQ) :  

4:41 pm North American Energy elects to redeem, in whole, its 9.125% Series 1 Senior Unsecured Debentures due 2017 (NOA) : The Company currently has a principal amount of $10,000,000 of Notes outstanding and the Notes will be redeemed on September 30, 2016 at a redemption price of 100% of the principal amount of the Notes, plus accrued and unpaid interest on the Notes to but not including the Redemption Date of approximately $44 per $1,000 of principal amount of Notes. The record date for the redemption will be September 26, 2016.

4:18 pm Market Internals (:MKTIN) :

The Dow Jones Industrial Average ended down to 18395.4 ( -0.29%). The Nasdaq Composite ended higher at 5218.92 ( 0.13%) and the S&P 500 closed down at 2169.04 ( -0.16%). Action came on lower than average volume (NYSE 797 mln vs avg. of 900 mln; Nasdaq 1472 mln vs avg. of 1687 mln) , w/ decliners outpacing advancers (NYSE 1206/1820, NASDAQ 1337/1497) and new highs outpacing new lows (NYSE 196/11, NASDAQ 145/27) .

Relative Strength:

S&P 500 VIX ST Futures-VXX +1.05%, U.S. Nat Gas -UNG +0.95%, Vietnam -VNM +0.87%, Nasdaq Biotechs-IBB +0.82%, Livestock-COW +0.739%, S&P Bank -KBE +0.738%, Emerging Middle East & Africa-GAF +0.35%, Provident Financial Services-PFS +0.14%, Indian Rupee -ICN +0.0471%, Emerging Markets Eastern Eur-ESR +0%

Relative Weakness:

Grains Subindex-JJG -2.333%, Utilities Select-XLU -2.05%, Greece 20-GREK -2.045%, South Africa-EZA -2.01%, Teucrium Corn-CORN -1.9046%, Poland-EPOL -1.87%, Mexico-EWW -1.75%, Singapore-EWS -1.597%, U.S. Home Construction -ITB -1.16%, Steel -SLX -1.11%

4:18 pm ERBA Diagnostics receives non-compliance notice from the NYSE MKT for its failure to timely file its Quarterly Report on Form 10-Q for the quarter ended June 30 (ERB) : As previously reported, the Company submitted the plan of remediation and compliance to the Exchange and the Exchange accepted the Plan and granted the Company an extension until November 25, 2016 to regain compliance with the continued listing standards of the Company Guide. The Company says it is working diligently to regain compliance with the Company Guide by November 25, 2016.

4:13 pm Closing Market Summary: Stocks Mixed as Investors Examine Rate Commentary (:WRAPX) :

The stock market ended a downbeat week on a flat note as commentary from the Jackson Hole Symposium boosted U.S. rate hike expectations and weighed on the major averages. The Dow Jones Industrial Average (-0.3%) settled behind the S&P 500 (-0.2%) and the Nasdaq Composite (+0.1%).

Equity indices enjoyed a modest bid at the start of the session as investors pored over a less-hawkish-than-feared interpretation of Fed Chair Yellen's seminal address. Chair Yellen indicated that the case for a rate hike had improved in recent months, but she also acknowledged that monetary policy is not on a preset course.

Investors initially shrugged off the commentary, evidenced by a transitory decline in the fed funds futures market. The implied probability of a rate hike at the September meeting briefly fell to 18.0%, slipping from the prior session's estimate of 21.0%. Additionally, equities and Treasuries rallied to session highs while the U.S. Dollar Index (95.49, +0.72, 0.76%) carved out a session low.

The broader market shifted gears near midday when Federal Reserve Vice Chairman Stanley Fischer resuscitated concerns regarding the speed and path of interest rate normalization. In a CNBC interview, Mr. Fischer indicated that more than one rate hike could take place before the end of the year. However, the Fed Vice Chair conditioned the potential hikes on a steady improvement in economic data. In response, the implied probability of a rate hike at the September meeting rose to 36.0% while the odds of an interest rate hike at the December meeting moved to 63.7%.

The S&P 500 (-0.2%) pared losses in the final hour, reclaiming technical support near the 2168/2171 price level. Despite the rebound, seven sectors ended in the red with the defensively-oriented telecom services (-1.1%) and utilities (-2.1%) sectors rounding out the leaderboard. On the flipside, heavily-weighted financials (+0.1%), technology (+0.1%), and health care (+0.4%) outperformed.

The countercyclical health care sector (+0.4%) ended in front of the pack, narrowing its week-to-date loss to 1.8%. Biotechnology displayed relative strength as the iShares Nasdaq Biotechnology ETF (IBB 285.14, +2.27) rebounded 0.8%. In the group, Amgen (AMGN 171.97, +1.74) outperformed while Mylan Labs (MYL 43.03, +0.18) recovered 0.4%. Mylan was under pressure this week as investors weighed criticisms regarding the price of its EpiPen device. Conversely, St. Jude Medical (STJ 78.01, +0.19) ended higher by 0.2% after responding to yesterday's bearish commentary from Muddy Waters Capital.

In the technology sector (+0.1%), the high-beta chipmakers outperformed, evidenced by the 0.5% gain in the PHLX Semiconductor Index. Micron (MU 16.51, +0.31) rallied 1.9%, sporting a week-to-date gain to 1.6%. This compares to a gain of 0.5% in the price-weighted index. Separately, large cap component Facebook (FB 124.96, +1.07) outperformed.

The consumer discretionary space (-0.3%) demonstrated relative weakness as retail names underperformed. The SPDR S&P Retail ETF (XRT 45.02, -0.34) ended lower by 0.8%, extending its week-to-date loss to 2.0%. Dow component Nike (NKE 59.00, -0.24) settled lower by 0.4% after being downgraded to "Neutral" from "Buy" at B. Riley & Company. Separately, Big Lots (BIG 50.57, -2.37) underperformed as investors evaluated mixed quarterly results. 

Treasuries ended on a lower note as yields rose through the curve. The yield on the benchmark 10-yr note finished higher by four basis points (1.62%) while the yield on the 2-yr note finished at 0.84% (+5 bps).

Today's participation was above the recent average as more than 797 million shares changed hands on the NYSE floor.

Today's economic data included the second estimate of Q2 GDP, July International Trade in Goods, and the final reading of the University of Michigan Consumer Sentiment Survey for August: 

  • Second quarter GDP was revised down to 1.1% from 1.2%, as expected, while the GDP Price Deflator was revised up to 2.3% (Briefing.com consensus 2.2%) from 2.2%.
    • There was no real change to second quarter GDP, which everyone had already realized was quite disappointing despite the strong pickup in consumer spending.
  • There was no real change to second quarter GDP, which everyone had already realized was quite disappointing despite the strong pickup in consumer spending.
  • July International Trade in Goods showed a deficit of $59.32 billion, compared to the June deficit of $64.5 billion.
  • The final reading for the University of Michigan Consumer Sentiment Survey for August dipped to 89.8 (Briefing.com consensus 90.6) from the preliminary reading of 90.4.
    • The reading checked in just below the final reading of 90.0 for July.
  • The reading checked in just below the final reading of 90.0 for July.

For further details on these economic releases, be sure to visit Briefing.com's Economic Calendar page.

Monday's economic data will include July Personal Income (Briefing.com consensus 0.4%), Personal Spending (Briefing.com consensus 0.3%), and Core PCE Prices (Briefing.com consensus 0.1%), which will each be released at 8:30 ET. 

  • Russell 2000 +9.0% YTD
  • S&P 500 +6.1% YTD
  • Dow Jones +5.6% YTD
  • Nasdaq Composite +4.2% YTD 

Week in Review: All Eyes on Jackson Hole

The stock market spent the bulk of the week inside a narrow range, but Friday was a bit more active as participants responded to remarks from Federal Reserve Chair Janet Yellen, who spoke at the Kansas City Fed Economic Symposium in Jackson Hole, Wyoming.

During her speech, Ms. Yellen said that the case for a rate hike has strengthened in recent months, but she also noted that business investment remains soft and subdued foreign demand has restrained exports. Furthermore, Chair Yellen noted that future policymakers should explore the possibility of purchasing a broader range of assets. Overall, Ms. Yellen's speech could be deemed as hawkish or dovish depending on which elements one chose to focus on.

Ms. Yellen was followed by Fed Vice Chair Stanley Fischer, who appeared on CNBC and indicated that more than one rate hike could take place, but more data needs to be analyzed before that decision is made. Stocks retreated after these comments while rate hike expectations were pulled forward.

According to the fed funds futures market, the implied likelihood of a September rate hike increased to 36.0% from 21.0% on Thursday while the implied probability of a rate hike in December increased to 63.7% from yesterday's 51.7%.

The S&P 500 lost 0.7% for the week while the Nasdaq (-0.4%) outperformed slightly.

The first half of the trading week was very quiet even though participants received a few more quarterly reports from retailers. Best Buy (BBY), Guess? (GES), and PVH (PVH) surpassed estimates while Express (EXPR), Dollar General (DG), and Dollar Tree (DLTR) disappointed.

Although Friday's focus was squarely on the speech from Fed Chair Yellen, investors also received the second estimate of second-quarter GDP, which was revised down to 1.1% from 1.2%, as expected, while the GDP Price Deflator was revised up to 2.3% (Briefing.com consensus 2.2%) from 2.2%. There was no real change to second-quarter GDP, which everyone had already realized was quite disappointing despite the strong pickup in consumer spending.

4:11 pm Ardmore Shipping completes annual review of securities filings (ASC) :

As a part of this process, the Company has filed the following documents: a shelf registration statement on Form F-3 registering $500 million of primary securities and additional secondary securities, a registration statement on Form S-8 registering shares under the 2013 Equity Incentive Plan, and a prospectus supplement for an at-the-market program.

  • Under the ATM program, the Company has entered into an open market sale agreement pursuant to which the Company may offer and sell common shares of up to an aggregate sales amount of $25 million.
  • In addition, the Company's Board of Directors has authorized an expansion of the existing share repurchase plan to $25 million.
  • "We routinely review our securities filings to ensure we have the ability at all times to pursue a range of potential opportunities in the execution of our strategic growth plan. We do not have plans for raising additional capital at this time."

3:36 pm St. Jude Medical issues official statement responding to Muddy Waters report (shares halted) (STJ) :

  • We have examined the allegations made by Capital and MedSec on August 25, 2016 regarding the safety and security of our pacemakers and defibrillators, and while we would have preferred the opportunity to review a detailed account of the information, based on available information, we conclude that the report is false and misleading. Our top priority is to reassure our patients, caregivers and physicians that our devices are secure and to ensure ongoing access to the proven clinical benefits of remote monitoring. St. Jude Medical stands behind the security and safety of our devices as confirmed by independent third parties and supported through our regulatory submissions.
  • Remote monitoring is a safe and effective means for patients to communicate with their physician. It has been well documented in leading publications that remote monitoring saves lives. At St. Jude Medical, we work with third-party experts, researchers, government agencies and regulators in cybersecurity to develop appropriate safeguards for our data and devices as part of our product development process and life cycle. These experts assist in designing security controls from the early stages of product design through final release and ongoing product enhancements, including software updates and security patches for our products. We also conduct regular risk assessments based on FDA guidance and perform penetration tests using internal and external experts. In addition, we collaborate with industry and governmental organizations to gain insight on recent trends and take appropriate action.
  • Our system provides an automated remote upgrade process for all Merlin@home units that are in active use so that security enhancements are automatically deployed when they become available. Merlin@home units that are not in active use and connected to the internet will also be upgraded when they return to use if a new update is available. Our analysis concluded that the majority of the observations in the report apply to older versions of the Merlin@home devices (i.e., those that have not been updated through the automated remote upgrade process). We are confident in the technology that we provide and in our process for continuously building upon our security protocols and processes. We want to reassure our patients that our systems meet the highest international security requirements, as required by regulatory authorities and international standards organizations.

The company further stated that claims of remote battery depletion are misleading, the flawed test methodology on outdated software demonstrates fundamental lack of understanding of medical device technology, says it will remain ever vigilant and dedicated to patient safety, and lastly that it is a strong supporter of responsible disclosure and proactively works with industry groups like NH-ISAC and ICS-CERT. Full Response

3:00 pm Reed's announces notification by the NYSE that it determined to accept their plan to regain compliance, grant period plan through Dec 22, 2017 (REED) :  

1:57 pm BlackBerry announces redemption of existing convertible debentures and issuance of new convertible debentures - shares halted (BBRY) :

  • Co announces the amendment of the indenture governing its 6% unsecured convertible debentures to permit optional redemption prior to Nov 13, 2016. Additionally, there will be an issuance of a notice of redemption to holders of the 6% Debentures pursuant to which BlackBerry will redeem the entire outstanding principal amount of the 6% Debentures on Sept 2, 2016. As of the date hereof, ~$1.245 bln aggregate principal amount of 6% Debentures remains outstanding. The 6% Debentures will be redeemed on the Redemption Date at a redemption price of 106.7213% of the outstanding principal amount. The redemption price includes all of BlackBerry's obligations in respect of principal and interest, and no additional amounts will be payable under the 6% Debentures.
  • Based on the conversion price, BlackBerry expects that none of the 6% debentures will be converted.
  • BlackBerry also announced that it has entered into an agreement pursuant to which Fairfax Financial Holdings and other institutional investors will subscribe for 3.75% unsecured convertible debentures of BlackBerry on a private placement basis for an aggregate subscription price of $605 mln. The transaction is expected to be completed on Sept 2, 2016. The 3.75% Debentures will be convertible into common shares of BlackBerry at a price of $10.00 per common share and will be due on Nov 13, 2020. Based on the number of common shares currently outstanding, if all of the USD$605 million of 3.75% Debentures were converted, the Common Shares issued upon conversion would represent approximately 11.57% of the Common Shares outstanding after giving effect to the conversion.
  • The other terms of the 3.75% debentures are substantially identical to those of the 6% debentures, except that the 3.75% debentures are not redeemable prior to maturity.

1:11 pm Sector Summary: Industrials trade in-line with broader market (:SUMRX) :

The Industrials sector (XLI) is trading down 0.3% today, in-line with the broader market (SPY -0.3%) as the market reacts to Janet Yellen's comments that rate hike odds have 'strengthened'. 

Earnings/Guidance

  • Tata Motors (TTM +1.71%) reports Q1 GAAP EPS of INR 6.67 versus INR 8.88 single est. Revenues increased 10% y/y to INR 670.56 bln vs INR 647.065 bln consensus. Passenger vehicles segment grew by 6.3 % y/y with car segment growth of 15.1 % y/y on the back of strong response to the recently launched Tiago.
  • Aceto (ACET -21.2%) reports Q4 earnings of $0.35 per share compared to two analyst estimates of $0.36. Revenues fell 7.6% y/y to $135.4 mln compared to two analyst estimates of $143.59 mln. For 2017, co is expecting both sales and non-GAAP adjusted earnings per share to grow in the mid-single digit percentage range comapred to two analyst estimates of EPS growth ~13% and sales +7%.

Other industrials moving on earnings/guidance: (ULTR -15.8%)

News

  • Diana Shipping (DSX -3.8%) announces that it has engaged financial advisors to negotiate amendments to its loan facilities & the deferral of amortization payments.
  • Lockheed Martin (LMT -1.2%) awarded $126 mln US Navy contract modification. 

Broker Research

Downgrades

  • HEICO (HEI -4.1%) downgraded to Sector Weight from Overweight at KeyBanc Capital Mkts.
  • Alexander & Baldwin (ALEX -4.2%) downgraded to Mkt Perform from Mkt Outperform at JMP Securities.
  • Rockwell Collins (COL -0.2%) downgraded to Hold from Buy at Argus.

Other

  • American Airlines (AAL -1.1%) initiated with an In-line at Imperial Capital. With a price target of $40. Firm notes one of the most under-appreciated management achievements in recent years, in their view, was AAL's ability to report record net profit and pretax margins while flawlessly executing the Herculean integration of AMR and US Airways.
  • Air Transport Services Group (ATSG -1.2%) initiated with a Hold at Stifel on valuation.
  • Atlas Air Worldwide (AAWW +3.7%) initiated with a Buy at Stifel with a price target of $49 on valuation.
  • AutoZone (AZO -2%) initiated with Neutral ratings at Susquehanna.
  • Ecolab (ECL +0.1%) initiated with Outperform ratings at Macquarie.
  • Waste Mgmt (WM -0.9%) initiated with a Neutral rating at Macquarie.
  • Thomson Reuters (TRI +0.1%) initiated with Neutral ratings at Macquarie.
  • KAR Auction Services (KAR +0.1%) initiated with a Positive at Susquehanna.
  • Nielsen (NLSN +0%) initiated with an Outperform rating at Macquarie.
  • Exponent (EXPO -1%) initiated with a Buy at Cantor Fitzgerald.
  • USG (USG -0.1%) initiated with a Neutral at Citigroup

1:08 pm Midday Market Summary: Stocks Slip as Investors Weigh Fed Remarks (:WRAPX) :

The stock market has endured a volatile first half of trade as investors ruminate over recent commentary from Federal Reserve Chair Janet Yellen and Federal Reserve Vice Chair Stanley Fischer. The Dow Jones Industrial Average (-0.3%) trails the S&P 500 (-0.2%) and the Nasdaq Composite (UNCHF). The three indices sport week-to-date losses between 0.5% and 0.8%.

The major averages began the day on a modestly higher note as investors weighed mixed performances from global bourses and waited to hear from speakers at the Kansas City Fed's Economic Symposium. Japan's Nikkei (-1.2%) led to the downside overnight as disappointing inflation data spurred questions regarding the efficiency of monetary policy in dealing with slow consumer spending.

Equity indices notched session highs in the first hour of trade as investors responded to less-hawkish-than feared commentary from Fed Chair Yellen. Ms. Yellen stated that the case for increasing the fed funds rate has strengthened, but that monetary policy is not on a preset course. As such, Chair Yellen failed to offer a timetable for a rate hike despite her upbeat read on the U.S. economy. In response, equities and Treasuries rallied in lockstep while the dollar slipped.

The bullish response would prove to be short-lived as commentary from Fed Vice Chair Stanley Fischer renewed fears regarding a sooner-than-expected fed funds rate hike. Mr. Fischer stated that there was a chance that the Fed could hike rates twice before the end of the year, but followed the remarks by stating that the Fed needs to see a steady improvement in economic data.

The benchmark index trades off its session low, maintaining support near the 2165 price level. Eight sectors trade in the red with defensively-oriented utilities (-0.9%) and telecom services (-1.0%) acting as noticeable laggards. Conversely, heavily-weighted health care (+0.1%) and technology (+0.1%) outperform.

Biotechnology outperforms in the heavily-weighted health care sector (+0.1%), evidenced by the 0.2% gain in the iShares Nasdaq Biotechnology ETF (IBB 283.95, +1.08). In the ETF, Mylan Labs (MYL 43.38, +0.53) is trading higher by 0.6%, narrowing this week's loss to  5.6%. The stock was under pressure this week after several lawmakers and organizations criticized the company over the price of its EpiPen device. The broader sector has lost 2.1% this week, trailing the remaining spaces.

The PHLX Semiconductor Index (+0.3%) displays relative strength as Micron (MU 16.40, +0.20) extends yesterday's winning streak. The stock jumped 4.5% in the prior session after having its price target raised to $20 from $16 at Nomura.

The economically-sensitive financial sector (UNCHF) trades flat as rate-sensitive real estate investment trusts weigh on the group. Separately, money center banks outperform as markets weigh the increased possibility of a rate hike before the end of the year. The fed funds futures market estimates the implied probability of a rate hike at the September meeting at 30.0%, rising from 21.0% earlier in the session. The odds of a rate hike at the December meeting have increased to 57.2% from yesterday's likelihood of 51.7%.

The U.S. Dollar Index (95.20, +0.43, +0.45%) trades near a session high with the pound, euro, and yen losing ground to the greenback. The pound has ticked lower by 0.3% against the dollar (1.3150) while the single currency has lost 0.4% against the buck (1.1233).

Treasuries trade on a mixed note with the short end of the curve displaying relative weakness. The yield on the 2-yr note is higher by two basis points at 0.80%. 

Today's economic data included the second estimate of Q2 GDP, July International Trade in Goods, and the final reading of the University of Michigan Consumer Sentiment Survey for August: 

  • Second quarter GDP was revised down to 1.1% from 1.2%, as expected, while the GDP Price Deflator was revised up to 2.3% (Briefing.com consensus 2.2%) from 2.2%.
    • There was no real change to second quarter GDP, which everyone had already realized was quite disappointing despite the strong pickup in consumer spending.
  • There was no real change to second quarter GDP, which everyone had already realized was quite disappointing despite the strong pickup in consumer spending.
  • July International Trade in Goods showed a deficit of $59.32 billion, compared to the June deficit of $64.5 billion.
  • The final reading for the University of Michigan Consumer Sentiment Survey for August dipped to 89.8 (Briefing.com consensus 90.6) from the preliminary reading of 90.4.
    • The reading checked in just below the final reading of 90.0 for July.
  • The reading checked in just below the final reading of 90.0 for July.

For further details on these economic releases, be sure to visit Briefing.com's Economic Calendar page.

12:45 pm Index Changes Reminder: Shoe Carnival (SCVL) will replace Sagent Pharma (SGNT) in the S&P SmallCap 600 after the close of trading (:INDXCH) :  

12:42 pm Cliffs Natural Resources announces a tentative agreement with the United Steelworkers on a new 3-year labor contract effective as of October 1, 2015 (CLF) : The new contract will cover approximately 2,000 United Steelworker-represented workers at Cliffs' Tilden and Empire mines in Michigan, and its United Taconite and Hibbing Taconite mines in Minnesota.

12:40 pm Twilio ticking higher in recent trade following positive mention by Loop Capital's Kourtney Gibson on CNBC (TWLO) :  

12:32 pm Currency Commentary: Yellen, Fischer Shake Up Markets (:SUMRX) :

  • The Dollar Index has rallied above the 95 level as a busy day of Fed speakers takes its toll. Fed Chair Janet Yellen presented at the Jackson Hole Symposium at 10am ET. Ms. Yellen's comment that the case for a rate hike has strengthened has garnered plenty of headlines from the press, painting the comments as a hawkish Fed ready to hike. But a closer look at her comments suggests the Fed remains data dependent. About two hours after Ms. Yellen, the Fed's Stanley Fischer was interviewed on CNBC. He was asked if there was a possibility the Fed could raise in September and again later in the year. Mr. Fischer replied that the Fed Chair comments were consistent with that thought but again, highlighted that the Fed needs to see a steady improvement in economic data. These comments come ahead of next week which promises to be a busy one with the Jobs report (Fri), Personal Income & Spending, PCE Prices (Mon), and ISM Services (Wed).
  • The euro spiked to 1.1335 in initial reaction to the Yellen comments but has since rolled back to the 1.1220 area. The single currency is now holding the 100 sma for a key test. A read on German consumer confidence showed a slight month over month improvement, coming in line with expectations.
  • The pound has slipped back into the 1.31 area after being rejected at its 50-sma (1.3283). The test of the 50 came right after the Yellen comments but cable has revered 140 bps since the failed break out. There was no revision to the country's Q2 GDP as it stayed at +0.6% q/q.
  • The yen is sliding lower against the dollar as well. After failing to break above 100 we are seeing some yen bulls throw int he towel and head for the exit. Still, yen sits at 101.36 and the 100 level remains in play ahead of next week's economic data (BONDX, FOREX). 

12:08 pm Notable movers of interest: GME -10% following Q2 revenue miss, lower FY17 comp guidance (SCANX) :

The following are some of today's most notable movers of interest, categorized by market capitalization (large cap over $10 billion and mid cap between $2-10 billion) and ranked by % change (all stocks over 100K average daily volume).

Large Cap Gainers

  • ADSK (67.72 +6.31%): Reports Q2 EPS and revenue beats, guides Q3 above consensus.
  • SCCO (26.44 +1.65%): Upgraded to Buy from Hold at HSBC Securities. 

Large Cap Losers

  • ULTA (259.43 -4.43%): Shares fall on Q3 earnings guidance.
  • STJ (76.06 -2.26%): Shares continue to trade lower following news yesterday that Muddy Waters is shorting the stock.

Mid Cap Gainers

  • FIZZ (52.43 +5.28%): Shares rally to levels reached Wednesday when the co reported a strong Q1.
  • CDE (13.6 +1.95%): Metals move higher following Yellen's remarks that rate hike odds have 'strengthened' (AUY, GFI, HL...).

Mid Cap Losers

  • BRCD (9.27 -11.38%): Shares trade lower after JP Morgan reduces their price target to $8.50 from $10 on the co's Q4 outlook.
  • GME (28.79 -10.48%): Reports Q2 revenue miss, lowers FY17 comp guidance.
  • HLF (59 -4.73%): Shares fall after Bill Ackman on CNBC confirms reports that Jefferies had contacted him to buy part of Icahn's stake.

12:04 pm Mannatech resolves differences with Co-Founder Sam Caster and his consulting company, Wonder Enterprises (MTEX) : Caster, who left Mannatech in 2014, and Mannatech have ended arbitration proceedings. Mannatech has agreed to not pursue its rights to enforce certain covenants under the prior consulting agreements with Caster and Wonder Enterprises. For his part, Caster acknowledged that better disclosures could have been made to Mannatech regarding the formation of his new company, EM Squared, Inc., and the development of its products. EM Squared ceased operating at the end of 2015. Caster also stated that he regrets if any of his actions appeared to encourage customers and Associates to leave Mannatech to join his competing venture as that was not his intent; nor is it his intention to encourage them to leave for a competing company in the future.

12:02 pm Floor Talk: On Second Thought (Or Second Fed Speaker) (:TALKX) :

The major indices have rolled over in noticeable fashion in recent action, prompted presumably by a remark Fed Vice Chairman Stanley Fischer made in a CNBC interview with Steve Liesman.

Specifically, Liesman asked Mr. Fischer if markets should be on the edge of their seats looking for a rate hike in September and more than one rate hike before the end of the year.  As part of a rambling response, Mr. Fischer said that, what the Fed Chair said in her speech today, is consistent with answering yes to both questions... BUT... he added that the Fed still needs to see what the incoming data will look like.

His remark helped breathe some added life into the U.S. Dollar Index (95.13, +0.35, +0.4%), helped undercut the front end of the yield curve, and took the wind out of the sails of the stock market and the rate-sensitive utilities sector (-0.4%), which has slipped 1.1% from its highs seen after the release of Ms. Yellen's speech.

In brief, what went up (mostly) after Ms Yellen's speech first hit the wires has now come down (mostly) after Mr. Fischer's surprisingly candid admission on the potential policy path -- at least as he sees it.

11:53 am European Markets Closing Prices (:SUMRX) : European markets are now closed; stock markets across Europe performed as follows:

  • UK's FTSE: + 0.3%
  • Germany's DAX: + 0.6%
  • France's CAC: + 0.8%
  • Spain's IBEX: + 0.7%
  • Portugal's PSI: + 0.4%
  • Italy's MIB Index: + 0.8%
  • Irish Ovrl Index: + 0.8%
  • Greece ASE General Index: -0.1%

11:01 am Alere issues formal statement, confirms it has filed a lawsuit seeking to compel Abbott (ABT) to fulfill its obligations under the terms of the merger agreement (shares halted) (ALR) :

The co issued the following statement in response to inquiries from its shareholders: On August 25, 2016, Alere filed a complaint against Abbott in Delaware Chancery Court, which seeks to compel Abbott (ABT) to fulfill its obligations under the terms of the merger agreement to take all actions necessary to promptly obtain all required anti-trust approvals.

  • "We expect the redacted version of the complaint to be publicly available next week."
  • Alere says it will take all actions necessary to protect the interests of Alere shareholders, enforce Alere's rights under the merger agreement and compel Abbott to complete the transaction in accordance with its terms.

10:50 am Volatility products and ETFs (VXX, UVXY) sink as volatility premium deflates post-Yellen (VXX) :

  • With a positive market response to what's being portrayed as a hawkish one-liner (strengthened case for rate hike), the volatility premium that had been built up into today's event is deflating.
  • We're heading into a weekend and a very slow holiday week so the vol-crush was quick once the coast was clear post-Yellen.
  • The VIX is -0.91 at 12.72; UVXY -5%, VXX -2.5%

10:49 am Floor Talk: Market Still Cruisin' after Yellen Speech (:TALKX) :

There are 28 long paragraphs in Fed Chair Yellen's speech discussing the fed's monetary policy toolkit.  There was a three paragraph carve out in the speech, however, that touches on the current economic situation and outlook.  In that section, Ms. Yellen acknowledged that she believes the case for a rate hike has strengthened in recent months, but also reiterated that monetary policy is not on a preset course.

Thus far, the market has taken Ms. Yellen's speech in bullish stride.  A knee-jerk dip as the headlines hit the tape was quickly followed with a burst of buying interest that has every sector trading higher.

Notwithstanding her belief that the case for a rate hike has strengthened, the behavior of the capital markets doesn't exactly connote a strong belief that the Fed is going to actually raise rates soon or, if it did, that subsequent rate hikes will come in rapid-fire fashion.  Some early markers of that view have manifested themselves in the following way:

  • The CBOE Volatility Index (VIX 12.34, -1.29, -9.5%) has collapsed following the release of the speech
  • The US Dollar Index (94.42, -0.36, -0.4%) has sold off after the release of the speech
  • September fed funds futures have held steady, placing the probability of a September rate hike at just 18.0%
  • The highly rate-sensitive utilities sector (+0.6%) moved to new session highs after the release of the speech
  • The 2-yr note yield is down two basis points at 0.79%; and
  • Gold prices ($1340.30, +$15.70, +1.2%) have spiked after the release of the speech, bolstered by the weaker dollar

One is perhaps well advised not to get too caught up in the initial reaction given that trading conditions continue to remain relatively thin.   With the run the market has had, though, predicated on the belief that the Fed is going to stay lower for longer with its policy rate, it is fair to say that there would have been more acute selling action if Ms. Yellen took what was perceived to be a truly hawkish line.

She didn't do that.  Instead she walked a steady line, preparing the market for a possible rate hike, but leaving the door open for reserving the right not to raise rates.  

Accordingly, it is still steady as she goes for the stock market, which has been cruising along for years now with more interference from the Fed's communication style than from the policy rate itself.

10:10 am Post-Yellen, dollar index spikes to new HoD, gold, silver and oil seeing some whipsaw action (:COMDX) :

  • After an initial drop, there has been some recovery in some commodities, such as oil, which has fully recovered
  • In current trade...
    • Dollar index index is now +0.01% at 94.78
    • Oct crude oil +0.3% at $47.46/barrel
    • Sept nat gas -0.5% at $2.83/MMBtu
    • Dec gold +0.2% at $1327.00/oz
    • Sept silver +0.8% at $18.64/oz
    • Sept copper +0.5% at $2.09/lb
  • Dollar index index is now +0.01% at 94.78
  • Oct crude oil +0.3% at $47.46/barrel
  • Sept nat gas -0.5% at $2.83/MMBtu
  • Dec gold +0.2% at $1327.00/oz
  • Sept silver +0.8% at $18.64/oz
  • Sept copper +0.5% at $2.09/lb

10:10 am Markets respond to Yellen speech, comment from Yellen that the case for a rate hike has strengthened (SPY) :

  • The biggest one-liner from this speech that will make headlines is Yellen noting that "the case for an increase in the federal funds rate has strengthened in recent months."
  • Equities immediately pulled back on that but they have since bounced back to levels seen prior to the release of the speech, perhaps on the realization that such a comment echoes that of other recent Fed members, and isn't really a big surprise. 
    • S&P 500 is now +9 points at 2182; DJ +76; Nasdaq +24
    • Treasuries have declined sending yields higher by a few bps; 10-year yield is +0.006 at 1.583%
    • Dollar strengthened modestly
    • Rate-sensitive sectors are responding in a rate-positive fashion; Financials (XLF, KBE, KRE) are moving higher while Utilities (XLU) are pulling back
  • S&P 500 is now +9 points at 2182; DJ +76; Nasdaq +24
  • Treasuries have declined sending yields higher by a few bps; 10-year yield is +0.006 at 1.583%
  • Dollar strengthened modestly
  • Rate-sensitive sectors are responding in a rate-positive fashion; Financials (XLF, KBE, KRE) are moving higher while Utilities (XLU) are pulling back

9:45 am Opening Market Summary: Stocks Open Higher with Technology in the Lead (:WRAPX) :

The stock market began its day on a higher note with the Dow Jones Industrial Average (+0.4%) trading neck-and-neck with the S&P 500 (+0.4%) and the Nasdaq Composite (+0.4%).

All ten sectors trade in the green with technology (+0.5%) and materials (+0.6%) leading to the upside. The remaining gainers show upticks between 0.2% (consumer discretionary) and 0.4% (industrials).

In the consumer staples space (+0.4%), beverage names outperform with Anheuser-Busch InBev (BUD 127.51, +1.71) gaining 1.4%. Reports indicated that the company is planning to eliminated 5500 jobs after completing the SABMiller PLC (SBMRY 57.80, +0.25) deal. The broader sector has lost 0.2% this week, trading in-line with the benchmark index.

Retail names trade slightly behind the broader consumer discretionary space (+0.2%). In the group, Big Lots (BIG 53.33, +0.39) outperforms after beating top-line estimates for the quarter. Conversely, Dow component Nike (NKE 58.70, -0.54) weighs after being downgraded to "Neutral" from "Buy" at B. Riley & Co.

On the commodities front, WTI crude trades higher by 0.2% ($47.44/bbl; +$0.13) while gold has jumped 0.65 to $1,332.90/ozt.

9:17 am S&P futures vs fair value: +4.00. Nasdaq futures vs fair value: +1.30. (:WRAPX) :

The stock market is on track for a modestly higher open as the S&P 500 futures trade four points above fair value.

Index futures hover above their flat lines as investors respond to cautious trade in overseas markets. Japan's Nikkei (-1.2%) underperformed, reacting to weaker-than-expected inflation data. The data points spurred hopes for additional policy accommodations, but also signaled the inefficiency of monetary policy in dealing with slow consumer spending. Separately, European bourses trade near their flat lines as investors eye above-consensus economic data and pore over recent commentary from Jackson Hole, Wyoming.

A slew of Federal Reserve officials have recently offered soundbites at the Kansas City Fed's Economic Symposium. For the most part, the group has struck a somewhat hawkish tone, indicating that a rate hike before the end of the year remains in the realm of possibilities. However, participants have maintained their holding pattern ahead of commentary from Federal Reserve Chair Janet Yellen. Ms. Yellen will address the symposium at 10:00 ET.

In company specific news, Herbalife (HLF 59.00, -2.93) trades lower by 4.7% following reports that investor Carl Icahn considered selling his stake in the company. Additionally, hedge fund manager Bill Ackman recently confirmed that Jefferies Group approached him about buying a portion of Icahn's position. Bill Ackman is known for being bearish on Herbalife and also holds a widely publicized short position in the stock. Separately, Rackspace (RAX 31.50, +1.31) has gained 4.3% after agreeing to be acquired by Apollo Global (APO 18.47, 0.00) for $32.00 per share. The deal is valued at $4.3 billion and is expected to close in the fourth quarter of this year.

Today's economic data will be capped off with the final reading of the University of Michigan Consumer Sentiment Survey for August (Briefing.com consensus 90.6), which will be released at 9:45 ET.

9:15 am Bob Evans: Sandell Asset Management releases presentation discussing 'compelling business reasons' to pursue a separation of the Company's two disparate and wholly-owned business segments, Bob Evans Farms Foods and Bob Evans Restaurants (BOBE) :

Sandell believes that the stock price of Bob Evans does not reflect the significant value associated with the Company's growing and highly-profitable packaged foods business, BEF Foods, which generated segment EBITDA in excess of $90 million for the Fiscal Year ending April, 2016.

  • Sandell cites the high valuation of many publicly-traded packaged foods companies as well as the mid to high teens multiples of EBITDA paid in numerous recent transactions in the packaged foods space as evidence justifying its belief that the value of BEF Foods may approach $1.2 billion, which would exceed the approximate $1.07 billion current enterprise value (market value plus net debt) of the entire Company. Based on the foregoing, Sandell believes that the market is ascribing negative value to the Company's Restaurants business, which it finds all the more shocking considering that Bob Evans wholly-owns highly-valuable real estate associated with the land and buildings of over 300 of its restaurants, which is in addition to the 143 restaurants that were part of a recent $197 million sale-leaseback transaction.
  • Presentation

9:12 am On The Wires (:WIRES) :

  • Manitowoc Foodservice (MFS) commences an offer to exchange all of its outstanding 9.500% senior notes due 2024 for new 9.500% senior notes due 2024. 
  • TerraForm Global (GLBL) announces that its subsidiary TerraForm Global Operating has launched the solicitation of consents from holders of record as of 5:00 pm ET on Aug 25, 2016 of its 9.75% senior notes due 2022 to obtain waivers relating to certain reporting covenants under the indenture dated as of Aug 5, 2015, among TerraForm Global, as issuer, the guarantors party thereto, and U.S. Bank National Association, as trustee, and to effectuate certain amendments to the Indenture.
  • Scott J. McLean, president and chief operating officer of Zions Bancorporation (ZION), will make a presentation at the Barclays Global Financial Services Conference on Tuesday, September 13, 2016 at 11:15 a.m. Additionally, Zions announced today that in accordance with the terms of the outstanding warrants to purchase common stock of Zions issued in May and October of 2010 the exercise price of the warrants has been reduced to ~ $35.89/share from ~$35.98 /share, and the warrant share multiplier has been increased to 1.0205 from 1.0180, effective as of August 18, 2016.

9:10 am Diana Shipping announces that it has engaged financial advisors to negotiate amendments to its loan facilities & the deferral of amortization payments (DSX) :

  • The co has reached an agreement in principle with certain lenders for terms that include the deferral of amortization payments and amending financial covenants. This agreement is subject to the co reaching similar deferral and covenant terms with its other lenders. The co is currently deferring certain amortization payments under its credit facilities. While the co is in ongoing negotiations with its lenders, it has not obtained formal waivers from any lender regarding payment deferrals or amendments to financial covenants.

9:01 am Northrim Bank increases quarterly to $0.20/share from $0.19/share (NRIM) :  

9:00 am Unity Bancorp increases quarterly dividend to $0.05/share from $0.04/share (UNTY) : In addition, the Board also declared a 10% stock dividend payable on Sept 30, 2016 to shareholders of record as of Sept 15, 2016.

8:59 am On The Wires (:WIRES) :

  • Portola Pharmaceuticals (PTLA) announces that the interim results from co's ongoing Phase 3b/4 ANNEXA-4 trial of AndexXa will be featured in an oral Late-Breaking Science Hot Line session at the European Society of Cardiology 2016 Congress, which will take place from August 27-31 in Rome. 
  • SpartanNash (SPTN) announces that Tammy Hurley, SpartanNash Vice President, has been named Chief Accounting Officer. 

8:58 am S&P futures vs fair value: +4.00. Nasdaq futures vs fair value: +3.10. (:WRAPX) :

The S&P 500 futures trade four points above fair value. 

Equity indices across Asia-Pacific ended the week on a mostly lower note with Japan's Nikkei (-1.2%) showing relative weakness. Weak inflation data was cited for the decline, but the yen saw limited movement, slipping 0.3% to 100.23 against the dollar. In addition, caution ahead of today's speech from Fed Chair Janet Yellen also contributed to the defensive action.

  • In economic data:
    • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
    • South Korea's August Consumer Confidence ticked up to 102 from 101
    • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)
  • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
  • South Korea's August Consumer Confidence ticked up to 102 from 101
  • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)

---Equity Markets---

  • Japan's Nikkei lost 1.2%, ending the week lower by 1.1%. Nine sectors finished in the red with health care (-2.4%), financials (-1.9%), and industrials (-1.6%) leading the retreat. Terumo, Chugai Pharmaceutical, Toyota Motor, Nitto Denko, Alps Electric, Tokio Marine Holdings, and Fanuc lost between 2.7% and 4.9%.
  • Hong Kong's Hang Seng added 0.4%, but shed 0.1% for the week. Consumer names like China Mengniu Dairy, Tingyi, and Want Want China gained between 5.3% and 6.6%. Financials also had a good showing with HSBC, Bank of East Asia, and Bank of China Hong Kong rising between 0.8% and 0.9%.
  • China's Shanghai Composite added 0.1%, narrowing its weekly loss to 1.2%. Taiyuan Lionhead Cement, Beijing Xinwei Technology Group, and Topchoice Medical Investment advanced between 5.1% and 6.9%.

Major European indices trade near their flat lines while Italy's MIB (-0.1%) underperforms amid weakness in financials. The euro (1.1303) and the pound (1.3214) hold slim gains against the dollar after the release of better than expected data, but equity markets have been range-bound as participants await remarks from Fed Chair Janet Yellen.

  • In economic data:
    • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
    • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
    • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
    • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
    • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)
  • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
  • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
  • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
  • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
  • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)

---Equity Markets---

  • France's CAC is higher by 0.2%. Vivendi has stumbled 4.5% after missing estimates while financials trade in mixed fashion. Credit Agricole and Societe Generale hold respective losses of 0.7% and 0.4% while BNP Paribas adds 0.1%. Cap Gemini is the top performer, climbing 1.5%.
  • UK's FTSE has ticked higher by 0.1% as miners outperform while drugmakers lag. Glencore, Rio Tinto, BHP Billiton, Anglo American, and Fresnillo are up between 0.7% and 2.4%. On the flip side, AstraZeneca, Shire, and GlaxoSmithKline are down between 0.5% and 1.2%.
  • Germany's DAX has slipped 0.1%. Prosiebensat and E.On are both down near 1.0% while Deutsche Bank and Commerzbank are down 0.4% and 0.9%, respectively. Exporters have had a good showing with Volkswagen rising 1.8% while Daimler and BMW add near 0.2% apiece.
  • Italy's MIB is down 0.1% with Banco Popolare, Banca Pop Emilia Romagna, Unicredit, UBI Banca, Banca di Milano Scarl, and Mediobanca falling between 1.7% and 2.6%.

8:53 am Transition Therapeutics shareholders approve merger with OPKO health (OPK), transaction expected to close Sept 1 (TTHI) :  

8:48 am Rackspace agrees to be acquired by Apollo Global (APO) for $32.00/share in cash, or approximately $4.3 bln (shares halted) (RAX) :

The co announced that it has entered into a definitive agreement with affiliates of certain funds managed by affiliates of Apollo Global Management, LLC (APO) to be acquired for $32.00 per share in cash. In connection with the transaction, funds managed by Searchlight Capital Partners, L.P. will make a strategic equity investment in the acquired company. The transaction has a total value of $4.3 billion, which includes the assumption of $43 million of net cash. Upon completion of the transaction, Rackspace will become a privately held company.

  • The transaction is expected to close in the fourth quarter of this year. The transaction is subject to the conclusion of the applicable antitrust waiting periods in the United States, the European Union and Israel, stockholder approval and other customary closing conditions.

8:39 am ITT Educational confirms receipt of letter from the DOE which continued Accrediting Council for Independent Colleges and Schools' show-cause directive against the Company (shares halted) (ESI) :

On August 25, 2016, the co received a letter from the U.S. Department of Education citing the August 17, 2016 letter from the Accrediting Council for Independent Colleges and Schools to the Company, which continued ACICS' show-cause directive against the Company. The ED Letter summarizes the ACICS standards that ACICS has indicated the Company has not yet demonstrated full compliance with, and related concerns of ACICS. The ED Letter states that the Company has failed to meet the requirements established by ACICS, as required by the Company's Program Participation Agreement with the ED. The ED Letter provides that as a result of those facts and other information, including as detailed in previous communications from the ED to the Company, the ED is imposing the following conditions on the Company's continued participation in funding under the federal student financial aid programs under Title IV:

  • The surety provided by the Company to the ED must be increased from the current $94.4 million to $247.3 million, which amount represents 40% of the Title IV Program funds received by the ITT Technical Institutes during the most recently completed fiscal year;
  • The additional amount of $152.9 million (the "Additional Surety") must be provided to the ED within 30 days from the date of the ED Letter;
  • Effective immediately, all ITT Technical Institutes are required to make all Title IV Program fund disbursements under the Heightened Cash Monitoring 2 payment method, which requires the Company to make disbursements to students from its own institutional funds, and then submit a request for reimbursement of those funds to the ED;
  • The ITT Technical Institutes are restricted from enrolling or beginning classes for any new students who may receive Title IV Program funds;
  • The ITT Technical Institutes must provide all students with a notice disclosing the ACICS show-cause directives, including the fact that ACICS accreditation standards state that the "Council determines that [the] institution is not in compliance with the Accreditation Criteria, and is unlikely to become in compliance";
  • The ITT Technical Institutes must provide to the ED within 30 days of the ED Letter teach out agreements for all ITT Technical Institutes;
  • The Company may not pay, or agree to pay, any bonuses, severance payments, raises or retention payments to any of its management or directors, nor may it pay special dividends or make any expenditures out of the ordinary course of business and consistent with prior practices, without approval from the ED; and
  • The Company remains required to provide information to the ED as previously required by the ED, and previously disclosed by the Company, regarding various events and regarding the Company's operations, finances and future plans.

The ED Letter also provides that if the Company fails to meet any of these requirements, it will demonstrate to the ED that the Company is incapable of meeting the fiduciary and financial responsibility standards established by the Higher Education Act and the ED's regulations. The ED Letter states that, accordingly, the failure to meet these standards will result in the referral of this matter to the ED's Administrative Actions and Appeals Service Group for administrative action, including the potential revocation of the Program Participation Agreements for the ITT Technical Institutes, in which case the ITT Technical Institutes would no longer be eligible to participate in Title IV Programs.

  • The Company says it is evaluating these additional sanctions and requirements, as well as all options available to it.

8:33 am Second Quarter GDP Revised Lower...S&P futures vs fair value: +2.00. Nasdaq futures vs fair value: -0.10. (:WRAPX) :

The S&P 500 futures trade two points above fair value.

The second estimate of second quarter GDP pointed to an expansion of 1.1%, down from the 1.2% increase observed in the preliminary reading. The Briefing.com consensus expected a reading of 1.1%. The first quarter GDP Deflator rose to 2.3% while the consensus expected a revision to 2.2%.

Separately, July International Trade in Goods showed a deficit of $59.32 billion, compared to the June deficit of $64.5 billion.

8:33 am Gapping up (SCANX) :

Gapping up
In reaction to strong earnings/guidance
:

  • PSTG +12.4%, EPAY +8.5%, (also announces $60 mln stock repurchase program), UEPS +6.7%, QURE +3.2%, ADSK +2.8%

M&A news: BUD +0.9% (Bloomberg reports that In Bev (BUD) is planning to eliminate 5500 jobs following Sabmiller (SBMRY) deal)

Select metals/mining stocks trading higher:

  • CDE +3.1%, AU +3%, AG +3%, AG +2.7%, KGC +2.5%, SLW +2%, ABX +1.7%, RIO +1.6%, GOLD +1.4%, NEM +1.4%, GDX +1.3%, BBL +1.2%, SLV +1%

Other news:

  • DVD +18.1% (thinly traded, Dover Motorsports to sell its Nashville Superspeedway facility to an entity owned by Panattoni Development)
  • JMU +15.1% (Wowo states that its business scale does not include P2P financing and P2P internet lending service and announces Xiao Nan Guo Restaurants will acquire 9.82% stake at $6.00/share )
  • WCIC +6.2% (light volume, to join S&P SmallCap 600)
  • LEI +5.8% (Lucas Energy enters into agreement with its senior lender, plans to use the funds to participate in the drilling and completion of certain Eagle Ford wells under a joint operating agreement with Lonestar Resources)
  • NLS +5.3% (to join S&P SmallCap 600)
  • TGTX +5.1% (confirms Orphan Drug Designation for TG-1101 for the treatment of neuromyelitis optica & neuromyelitis optica spectrum disorder)
  • BOFI +3.6% (modestly pulling back following yesterday's advance)
  • WNR +2.3% (CEO disclosed purchase of 100K shares)
  • NYMX +2.2% (continued strength)
  • XONE +2% (CEO disclosed purchase of 7,200 shares worth abt $103K (transaction date 8/24) )
  • ON +1.9% (Littelfuse to acquire the product portfolio of transient voltage suppression diodes, switching thyristors and insulated gate bipolar transistorsfor automotive ignition applications from ON Semiconductor for $104 mln; ON Semiconductor confirms FTC clearance of its pending acquisition of Fairchild Semiconductor)
  • GLAD +1.9% (insider purchase by President, R. Marcotte, who bought 6K shares worth abt $51K)

Analyst comments:

  • PQ +30.1% (upgraded to Buy at Johnson Rice)
  • PBR +1.3% (upgraded to Neutral from Underperform at Credit Suisse)

8:32 am Medtronic announces offer to repurchase HeartWare's 3.50% convertible senior notes due 2017 & 1.75% convertible senior notes due 2021 in connection with the completion of the HeartWare acquisition (MDT) :  

8:31 am Par Pacific announces $50 mln common stock rights offering (PARR) :

  • Co announces the launch of a registered rights offering. In the rights offering, each holder of the Company's common stock as of the close of business on the record date of August 25, 2016 will be issued, at no charge, one transferable subscription right for each whole share of common stock owned by that stockholder on the record date.
  • The Company will offer a number of shares of its common stock in the rights offering, inclusive of the over subscription privilege, representing ~$50 million of gross proceeds. The Company plans to use the net proceeds from the rights offering to prepay or repay its 2.5% convertible subordinated bridge notes.

8:31 am Williams Partners to sell 6.975 mln common units representing limited partner interests to Williams Co (WMB) for approximately $250 mln in a private placement (WPZ) :

This private placement is a component of the plan referenced in the Second Quarter 2016 Financial Results news releases on Aug. 1, 2016, of Williams and Williams Partners intended to enhance value, strengthen their credit profiles and fund the development of a significant portfolio of fee-based growth projects at Williams Partners, while maintaining flexibility.

  • The price per common unit of $35.84 is equal to the average of the high and low trading prices of the Partnership's common units on the New York Stock Exchange for each of the five trading days from August 19 to August 25, 2016, less a discount of 2.5% per common unit, which price per common unit was calculated using the same method and discount that initially will be used to determine the price of the common units to be issued pursuant to the Partnership's anticipated distribution reinvestment plan.
  • Williams Partners plans to use the net proceeds from the private placement to repay amounts outstanding under the partnership's credit facility and for general partnership purposes. When the private placement is complete, Williams' aggregate ownership interest in Williams Partners, including the general partner interest, will remain at approximately 60 percent.

8:05 am S&P futures vs fair value: +3.00. Nasdaq futures vs fair value: +3.30. (:WRAPX) :

U.S. equity futures trade on a flat note with the S&P 500 futures hovering three points above fair value. Index futures on the benchmark index navigated a narrow five-point trading range overnight as investors adopted a cautious posture ahead of this morning's remarks from Fed Chair Janet Yellen. Ms. Yellen is slated to speak at 10 a.m. ET. Participants have been waiting for potential clues as to whether a fed funds rate hike remains possible before the end of the year. However, due to the nature of the discussion, it is possible that Chair Yellen will hold off on offering rate hike commentary.

Separately, St. Louis Fed President, and FOMC voter, James Bullard recently stated that the Fed could raise rates in 2016. However, he emphasized that he will be using the two-regime framework that he articulated in June. The fed funds futures market estimates the implied probability of a rate hike at the September meeting at 21.0%, rising from 12.0% last Friday. The odds of a rate hike at the December meeting are currently 51.7%.

Treasuries trade on a mixed note with the long end of the curve enjoying a modest bid. The yield on the 2-yr note is unchanged at 0.80% while the yield on the 10-yr note has slipped one basis point to 1.57%.

On the economic front, data will include the second estimate of Q2 GDP (Briefing.com consensus 1.1%) and July International Trade in Goods, which will each cross the wires at 8:30 ET. Separately, the final reading of the University of Michigan Consumer Sentiment Survey for August (Briefing.com consensus 90.6) will be released at 9:45 ET.

In U.S. corporate news of note:

  • GameStop (GME 29.60, -2.56): -8.0% after reporting a mixed quarter and lowering FY17 comparable store sales guidance
  • Ulta Salon (ULTA 266.00, -5.31): -2.0% following the company reporting a bottom-line beat and raising FY17 EPS and comparable store sales guidance
  • Pure Storage (PSTG 13.20, +1.37): +11.6% after beating top- and bottom-line estimates for the quarter and offering in-line Q3 guidance
  • Splunk (SPLK 61.15, -3.95): -6.1% despite the company topping quarterly estimates and issuing upbeat FY17 revenue guidance 

Reviewing overnight developments: 

  • Asia-Pacific indices ended the week on a mixed note with Japan's Nikkei (-1.2%) underperforming Hong Kong's Hang Seng (+0.4%) and China's Shanghai Composite (+0.1%). 
    • In economic data:
      • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
      • South Korea's August Consumer Confidence ticked up to 102 from 101
      • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)
    • In news: 
      • Weak inflation data was cited for the decline, but the yen saw limited movement, slipping 0.1% to 100.41 against the dollar.
      • In addition, the defensive action has been attributed to caution ahead of today's speech from Fed Chair Janet Yellen.
  • In economic data:
    • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
    • South Korea's August Consumer Confidence ticked up to 102 from 101
    • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)
  • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
  • South Korea's August Consumer Confidence ticked up to 102 from 101
  • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)
  • In news: 
    • Weak inflation data was cited for the decline, but the yen saw limited movement, slipping 0.1% to 100.41 against the dollar.
    • In addition, the defensive action has been attributed to caution ahead of today's speech from Fed Chair Janet Yellen.
  • Weak inflation data was cited for the decline, but the yen saw limited movement, slipping 0.1% to 100.41 against the dollar.
  • In addition, the defensive action has been attributed to caution ahead of today's speech from Fed Chair Janet Yellen.
  • European indices trade flat with Germany's DAX (-0.2%), France's CAC (UNCHF), and the U.K.'s FTSE (+0.1%). Elsewhere, Italy's MIB (-0.3%) underperforms amid weakness in financials.
    • In economic data:
      • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
      • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
      • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
      • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
      • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)
    • In news: 
      • The euro (1.1292) and the pound (1.3207) hold slim gains against the dollar after the release of better than expected data.
      • However, equity markets have been range-bound as participants await remarks from Fed Chair Janet Yellen.
  • In economic data:
    • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
    • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
    • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
    • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
    • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)
  • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
  • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
  • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
  • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
  • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)
  • In news: 
    • The euro (1.1292) and the pound (1.3207) hold slim gains against the dollar after the release of better than expected data.
    • However, equity markets have been range-bound as participants await remarks from Fed Chair Janet Yellen.
  • The euro (1.1292) and the pound (1.3207) hold slim gains against the dollar after the release of better than expected data.
  • However, equity markets have been range-bound as participants await remarks from Fed Chair Janet Yellen.

8:00 am TG Therapeutics confirms Orphan Drug Designation for TG-1101 for the treatment of neuromyelitis optica & neuromyelitis optica spectrum disorder (TGTX) :  

7:47 am Volkswagen AG announces it can significantly reduce the effects of interruptions in production following supplier agreement (VLKAY) :

  • Following the agreement reached with two suppliers, Volkswagen can significantly reduce the effects of interruptions in production and for the most part compensate for downtimes by means of internal flexibilization measures.
  • The company had initially made precautionary arrangements for flexibilization measures at six plants and had not ruled out short-time work.

7:35 am On The Wires (:WIRES) :

  • JinkoSolar Holding (JKS) announces that subsidiary JinkoSolar Technology SDN BHD has signed a $25 mln combined tradeline agreement with Malayan Banking Berhad. This financing will be used to support JinkoSolar Malaysia's trade finance and working capital.
  • Chesapeake Energy Corporation (CHK) announces it has increased the aggregate purchase price offered for the Notes in the Tender Offers, exclusive of accrued interest, from up to $500 mln aggregate purchase price to up to $750 mln  and, in connection there with, established a tender cap of $600 mln aggregate purchase price for the 2.5% Contingent Convertible Senior Notes due 2037.

7:32 am Acorda Therapeutics' Biotie confirms it was granted orphan designation by the FDA for BTT1023 for the treatment of primary sclerosing cholangitis (ACOR) :  

7:27 am European Markets Update: FTSE UNCH, CAC -0.1%, DAX -0.2% (:SUMRX) :

Major European indices trade near their flat lines while Italy's MIB (-0.5%) underperforms amid weakness in financials. The euro (1.1289) and the pound (1.3198) hold slim gains against the dollar after the release of better than expected data, but equity markets have been range-bound as participants await remarks from Fed Chair Janet Yellen.

  • In economic data:
    • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
    • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
    • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
    • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
    • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)
  • Eurozone July M3 Money Supply +4.8% year-over-year (consensus 4.9%; last 5.0%) and Private Sector Loans +1.8% year-over-year, as expected (previous 1.8%)
  • Germany's September GfK Consumer Climate 10.2 (expected 9.9; last 10.0)
  • UK's Q2 GDP +0.6% quarter-over-quarter, as expected; +2.2% year-over-year, as expected. Index of Services +0.5% (expected 0.4%; last 0.3%) and Q2 Business Investment +0.5% quarter-over-quarter (expected -0.8%; last -0.6%); -0.8% year-over-year (consensus -1.4%; last -0.8%)
  • France's Q2 GDP 0.0% quarter-over-quarter, as expected (last 0.0%) and August Consumer Confidence ticked up to 97 from 96
  • Spain's July Retail Sales +4.9% year-over-year (consensus 4.0%; last 5.7%)

---Equity Markets---

  • UK's FTSE hovers near its flat line as miners outperform while drugmakers lag. Glencore, Rio Tinto, BHP Billiton, Anglo American, and Fresnillo are up between 0.7% and 2.4%. On the flip side, AstraZeneca, Shire, and GlaxoSmithKline are down between 0.5% and 1.2%.
  • France's CAC is lower by 0.1%. Vivendi has stumbled 4.5% after missing estimates while financials trade in mixed fashion. Credit Agricole and Societe Generale hold respective losses of 0.7% and 0.4% while BNP Paribas adds 0.1%. Cap Gemini is the top performer, climbing 1.5%.
  • Germany's DAX has slipped 0.2%. Prosiebensat and E.On are both down near 1.0% while Deutsche Bank and Commerzbank are down 0.4% and 0.9%, respectively. Exporters have had a good showing with Volkswagen rising 1.8% while Daimler and BMW add near 0.2% apiece.
  • Italy's MIB is down 0.5% with Banco Popolare, Banca Pop Emilia Romagna, Unicredit, UBI Banca, Banca di Milano Scarl, and Mediobanca falling between 1.7% and 2.6%.

6:58 am Asian Markets Close: Nikkei -1.2%, Hang Seng +0.4%, Shanghai +0.1% (:SUMRX) :

Equity indices across Asia-Pacific ended the week on a mostly lower note with Japan's Nikkei (-1.2%) showing relative weakness. Weak inflation data was cited for the decline, but the yen saw limited movement, slipping 0.1% to 100.45 against the dollar. In addition, caution ahead of today's speech from Fed Chair Janet Yellen also contributed to the defensive action.

  • In economic data:
    • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
    • South Korea's August Consumer Confidence ticked up to 102 from 101
    • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)
  • Japan's August National CPI -0.4% year-over-year, as expected (last -0.4%) and National Core CPI -0.5% year-over-year (consensus -0.4%; last -0.5%). Tokyo CPI -0.5% year-over-year (consensus -0.4%; last -0.4%) and Tokyo Core CPI -0.4% year-over-year (consensus -0.3%; last -0.4%). BoJ Core CPI +0.5% year-over-year (last 0.8%)
  • South Korea's August Consumer Confidence ticked up to 102 from 101
  • Singapore's Industrial Production -4.0% month-over-month (expected -1.1%; last -1.5%); -3.6% year-over-year (consensus 0.9%; last 0.6%)

---Equity Markets---

  • Japan's Nikkei lost 1.2%, ending the week lower by 1.1%. Nine sectors finished in the red with health care (-2.4%), financials (-1.9%), and industrials (-1.6%) leading the retreat. Terumo, Chugai Pharmaceutical, Toyota Motor, Nitto Denko, Alps Electric, Tokio Marine Holdings, and Fanuc lost between 2.7% and 4.9%.
  • Hong Kong's Hang Seng added 0.4%, but shed 0.1% for the week. Consumer names like China Mengniu Dairy, Tingyi, and Want Want China gained between 5.3% and 6.6%. Financials also had a good showing with HSBC, Bank of East Asia, and Bank of China Hong Kong rising between 0.8% and 0.9%.
  • China's Shanghai Composite added 0.1%, narrowing its weekly loss to 1.2%. Taiyuan Lionhead Cement, Beijing Xinwei Technology Group, and Topchoice Medical Investment advanced between 5.1% and 6.9%.
  • India's Sensex slipped 0.2%, widening this week's decline to 1.3%. Roughly half of index components posted losses with Wipro, Larsen & Toubro, and Infosys sliding between 1.5% and 3.0%. On the upside, Tata Motors, GAIL, Reliance Industries, and CIPLA gained between 0.9% and 2.0%.

---FX---

  • USDJPY -0.1% to 100.45
  • USDCNY +0.3% to 6.6710
  • USDINR +0.1% to 67.066

6:53 am Marine Products commences a tender offer to purchase for cash 3.2 mln shares of common stock at a purchase price of $9.00/share, with the right to increase the tender offer to up to 3.5 mln shares (MPX) : The tender offer will expire at 11:59 pm ET on Nov 1, 2016.

6:31 am ReneSola announces that it sold a 1.23 MW solar power project located in Ibaraki Japan; financial details undisclosed (SOL) : Revenue from the sale will be recognized in the third quarter and all proceeds have been collected.

6:29 am On The Wires (:WIRES) :

  • Vectrus Systems Corporation, a subsidiary of Vectrus (VEC), was awarded a $21 mln installation services contract in support of the U.S. Air Force at Al Udeid Air Base in Qatar.
  • Neonode (NEON) reaches a major milestone in its go to market strategy for its revolutionary AirBar device. AirBar pre-order customers are being notified by email that they can convert their pre-orders for the 15.6 inch AirBar to firm orders.

6:18 am S&P futures vs fair value: +4.00. Nasdaq futures vs fair value: +4.50. :

6:18 am European Markets : FTSE...6818.16...+1.30...0.00.  DAX...10517.49...-13.50...-0.10%.

6:18 am Asian Markets : Nikkei...16,360.71...-195.20...-1.20%.  Hang Seng...22,909.54...+94.60...+0.40%.

6:07 am Big Lots beats by $0.06, misses on revs; guides Q3 EPS in-line; guides Q4 (Jan) EPS in-line; Q2 comps +0.3% (BIG) :

  • Reports Q2 (Jul) earnings of $0.52 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus of $0.46; revenues fell 0.5% year/year to $1.2 bln vs the $1.22 bln Capital IQ Consensus. Q2 Comparable store sales increased 0.3% for the quarter, compared to our guidance of flat to an increase of 2%.
  • Co issues in-line guidance for Q3, sees EPS of ($0.04) - $0.01, excluding non-recurring items, vs. ($0.03) Capital IQ Consensus Estimate. Provides initial Q3 guidance for comparable store sales in the range of flattish to +2%.
  • Co issues in-line guidance for Q4 (Jan), sees EPS of $2.18-2.23 vs. $2.21 Capital IQ Consensus Estimate. Provides initial Q4 guidance for comparable store sales in the range of flattish to +2%.

5:08 am On The Wires (:WIRES) :

  • DENSO (DNZOY) has entered into a technical advisory contract with one of the world's foremost researchers in computer vision, Carnegie Mellon University Professor Dr. Takeo Kanade. Through this contract, DENSO is looking to advance its artificial intelligence technology and expand its engineering expertise in the areas of advanced driver assistance systems, autonomous drive, and the Internet of Things
  • Net 1 UEPS Technologies (UEPS) announced that it has signed a subscription agreement with One MobiKwik Systems Private in India. MobiKwik is India's largest independent mobile payments network, with over 32 million users and 100,000 retailers.
  • BT Group's (BT) unit EE announced an exclusive offer that includes six months of Apple (AAPL) Music membership for new and upgrading EE pay monthly customers.

3:51 am Eisai receives Japanese approval for TREAKISYM (ESALY) :

Co announced that the anticancer agent TREAKISYM for Injection 100 mghas been approved in Japan for an additional indication of chronic lymphocytic leukemia.

  • TREAKISYM is the subject of a licensing agreement concluded between Eisai and SymBio Pharmaceuticals
  • TREAKISYM was initially approved in Japan in October 2010 for relapsed or refractory low-grade B-cell non-Hodgkin's lymphoma and mantle cell lymphoma.
  • Under the licensing agreement concluded between the two companies, Eisai has been marketing the product in Japan since its launch in December 2010.

3:14 am On The Wires (:WIRES) :

  • Takeda Pharmaceutical Limited (TKPYY) announced the launch of a bold, new Access to Medicines strategy, aimed at increasing access to its innovative and potentially life-saving medicines for patients with some of the highest unmet medical needs. For decades, the company has provided product, funding and access in many parts of the world, based on regional needs. The new AtM strategy builds on that by focusing on geographies and therapy areas with the highest unmet need.
  • Toshiba's (TOSBF) Storage & Electronic Devices Solutions Company announced the launch of a series of low-input current drive, rail-to-rail output, gate-drive photocouplers in a low-height package that allows bufferless direct drive of low- to medium-power IGBTs and MOSFETs from microcontrollers. Shipments of the three new products; "TLP5771", "TLP5772" and "TLP5774" start from today.

3:12 am Phillips 66 Partners acquires Chevron's (CVX) South Louisiana NGL logistics assets; expects EBITDA of $25 mln in 2017 (PSXP) :

Phillips 66 Partners LP announced that an agreement has been reached for it to acquire a natural gas liquids logistics system in southeast Louisiana currently owned by Chevron (CVX). The system includes approximately 500 miles of pipelines and a storage cavern connecting multiple fractionation facilities, refineries and a petrochemical facility.

  • The acquisition includes the following assets:
    • TENDS Pipeline System, an ~300-mile, bidirectional NGL pipeline system connected to third-party fractionators, refineries -- including the Phillips 66 Alliance Refinery -- and a petrochemical plant.
    • VP Pipeline / EP Pipeline, ~200 miles of regulated pipelines that carry raw NGLs from a third-party natural gas processing plant to pipeline and fractionation infrastructure.
    • Sorrento Cavern, a salt dome cavern with approximately 1.5 million barrels of NGL storage capacity located in Ascension Parish.
  • TENDS Pipeline System, an ~300-mile, bidirectional NGL pipeline system connected to third-party fractionators, refineries -- including the Phillips 66 Alliance Refinery -- and a petrochemical plant.
  • VP Pipeline / EP Pipeline, ~200 miles of regulated pipelines that carry raw NGLs from a third-party natural gas processing plant to pipeline and fractionation infrastructure.
  • Sorrento Cavern, a salt dome cavern with approximately 1.5 million barrels of NGL storage capacity located in Ascension Parish.
  • The Partnership expects EBITDA from the acquired assets to be ~$25 million in 2017.
  • The acquisition will be financed with cash and borrowings under the Partnership's revolving credit facility.
  • The transaction is expected to close in the fourth quarter of 2016 pending regulatory approvals.

3:04 am Ferroglobe beats by $0.02; misses on revs (GSM) :

Reports Q2 EPS of ($0.01) vs ($0.03) Capital IQ consensus; revs fell 6% YoY to $398.0 mln vs $434.9 mln consensus.

  • In terms of sales volumes, silicon metal experienced a decline of 5% quarter over quarter, but improved dynamics in the steel industry allowed sales increases of 2% in silicon alloys and a strong 11% in manganese alloys.
  • The Board has decided to maintain the quarterly interim dividend of $0.08 per share, further reflecting the confidence in the underlying strength of the business and the company's long-term outlook.

2:58 am On The Wires (:WIRES) :

  • Transition Therapeutics (TTHI) announced that the Company has received shareholder approval for the previously announced plan of arrangement involving Transition, OPKO Health (OPK). A total of 24,586,901 common shares, approximately 63.4% of the outstanding common shares, were represented at the meeting of Transition Shareholders in person or by proxy. 
  • Rusal (RUALF) announced that members of the Group and associates of En+ entered into a contract/addendum, pursuant to which associates of En+ agreed to provide transportation services to members of the Group.