Friday Morning Reads
- Worries Over Tax Cuts, Debt
- Inflation Worrywarts Just Need to Calm Down
- What’s Next for Net Neutrality?
- Cryptocurrency Trading
- More Cashierless Stores
- The Blockchain Market Has Cooled
- Are You Out Of Your Comfort Zone?
- General Mills to buy Blue Buffalo for $8B
- Fed monetary policy report on tap
- Chinese regulator seizes Anbang
- U.S. settlement looms over RBS results
- BlackRock puts gunmakers on notice
- Nissan joins self-driving taxi club
- GM Korea seeks to trim benefits, wages
- Potential changes to biofuels policy?
- Head and Shoulders
- Bottom Scans I
- Bottom Scan II
- Bottom Scan III
- Overbought / Oversold
- Bull Flags
- Channel Up Scan
Unusual Option Action:
General Mills is moving into the pet food business with a deal to buy Blue Buffalo (NASDAQ:BUFF) for $40 a share, or nearly $8B in cash. The transaction, which will help the company offset intensifying competition in the packaged food industry, is expected to be neutral to General Mills' (NYSE:GIS) cash earnings per share in fiscal year 2019, but will add to earnings in fiscal year 2020. BUFF +16.9% premarket.
Will Fed Chair Jerome Powell be able to calm the recent game of tug-of-war between stocks and bonds? The first sign may come today when the central bank releases its monetary policy report, expected to be a blueprint for Powell's testimony before Congress next week. Investors will also be watching Fed speakers today at the U.S. Monetary Policy Forum annual conference.
President Trump has called a meeting with key senators and Cabinet officials next week to discuss potential changes to the biofuels policy, Reuters reports. It follows the recent bankruptcy of Philadelphia Energy Solutions, which blamed the regulation for its demise. Sources said the meeting will also consider whether to cap prices for biofuel credits, let higher ethanol blends be sold all year and get speculators out of the market.
The Chinese government has seized control of Anbang Insurance Group and said its chairman had been prosecuted, in a striking move that highlights Beijing's willingness to crack down on financial risk and curtail debt-laden conglomerates. Anbang is said to have violated laws and regulations that "may seriously endanger the solvency of the company," following acquisitions including the Waldorf Astoria and insurers in Europe and Asia.
Japanese core consumer prices remained at 0.9% in January on higher energy costs, almost matching market forecasts but still below the 2% goal of the BOJ. That adds to growing challenges for Governor Haruhiko Kuroda as he prepares for his second term in April, with the central bank unable to reach its inflation target despite years of massive stimulus.
Australian Prime Minister Malcolm Turnbull will head to the White House today to meet with President Trump. Topics likely to be explored include China's rising influence, investing Australian pension money in U.S. infrastructure and convincing the U.S. to rejoin the Trans-Pacific Partnership. The pact among 11 countries includes Australia, which also has a bilateral free trade deal with the U.S.
Royal Bank of Scotland shares are down over 4% in London, on track for their steepest slide since 2016. While the bank reported a bottom line profit for the first time in a decade, it warned that a pending settlement with the U.S. Department of Justice could hit its 2018 results. RBS has set aside around £3.2B for the litigation, but the issue complicates a government plan to start selling down its stake in the lender.
BlackRock will speak with weapons manufacturers "to understand their response" to the second-deadliest public school shooting in U.S. history, putting pressure on American Outdoor Brands (NASDAQ:AOBC) and Sturm, Ruger & Company (NYSE:RGR). While it has stopped short of saying it would divest its funds of gunmakers, BlackRock (NYSE:BLK) is the largest shareholder in both companies and has more than $6T in assets under management.
A redesign of Snapchat is continuing to pile up negativity, with longtime bear MoffettNathanson reiterating a Sell rating and Kylie Jenner tweeting: "Sooo does anyone else not open Snapchat anymore?" Shares of the messaging app tumbled over 6% yesterday in response, erasing $1.7B in market value. Meanwhile, Evan Spiegel got $637.8M in total compensation after Snapchat (NYSE:SNAP) went public last year, marking the third-highest payout ever received by a CEO
Intel didn't inform U.S. cyber officials of the so-called Meltdown and Spectre chip security flaws until they leaked to the public, which was six months after Alphabet (GOOG, GOOGL) notified the chipmaker of the problems. The reason? Intel (NASDAQ:INTC) said it hadn't reported the issues because there wasn't any evidence of hacking. The details emerged in letters sent in response to questions from U.S. lawmakers.
Citing difficulty in securing U.S. approval for the deal, Xcerra (NASDAQ:XCRA) fell 2.6% in after-hours trading on news it will terminate its sale to China's Hubei Xinyan Equity Investment Partnership. It's the latest technology-related deal to be halted amid heightened U.S. scrutiny of foreign investments. Lattice Semiconductor (NASDAQ:LSCC) and Aixtron (NASDAQ:AIXG) previously saw their Chinese takeovers fall through.
Despite its bitter trade dispute with Canada, Boeing (NYSE:BA) has applied to stay in the race to supply Canada with 88 new fighter jets, in a deal likely worth C$15B-C$19B. Boeing, which makes the F/A-18 Super Hornet, is one of five potential contenders to supply the jets, including Lockheed Martin (NYSE:LMT), Airbus (OTCPK:EADSY), Saab (OTCPK:SAABF) and Dassault Aviation (OTCPK:DUAVF).
Nissan is joining the self-driving taxi club. In partnership with Japan's DeNA, the automaker will begin public field tests of its Easy Ride service next month in Yokohama. Leaf electric cars will ferry passengers on a set route between Nissan's (OTCPK:NSANY) headquarters and the World Porters shopping center, with the goal of launching commercially within the next few years.
Still in the news? Takata (OTCPK:TKTDQ) has agreed to pay a $650M civil penalty to end an investigation by the attorneys general of 44 U.S. states into whether the parts supplier concealed problems with its defective air bags. However, because Takata does not have the money, the states "agreed not to collect this civil penalty in order to maximize the recovery available to consumers who were the victims."
General Motors will propose a base wage and bonus freeze this year along with a suspension of some worker benefits at its loss-making South Korean unit, according to an internal letter seen by Reuters. GM announced last week that it would shut a facility in the city of Gunsan and decide the future of its remaining three local plants within weeks.
ABC TV has declared a sellout in advertising for the Oscars broadcast, the earliest one in its history. There are more ad categories than ever before, across more than a dozen segments, and despite a shrinking viewership, ABC (NYSE:DIS) had been seeking $2.2M-$2.6M for a 30-second spot. The 90th Academy Awards takes place on March 4.
A coalition of 23 state attorneys general have refiled a lawsuit challenging the FCC's rollback of net neutrality regulations after the commission published its final notice in the Federal Register. The move begins a 60-day clock for legislators to overturn the decision. Senate Democrats, who hold 49 seats in the 100-person chamber, have the backing of 50 senators for repeal, leaving them one vote short of a majority. Related stocks: ATUS, CMCSA, CTL, CHTR, FTR, T, VZ, NFLX, DISH, CCOI, S, TMUS
Apache (NYSE:APA) -6.3% after disappointing production guidance.
Chesapeake Energy (NYSE:CHK) +21.7% on higher output, lower costs.
First Solar (NASDAQ:FSLR) -2.4% AH as revenues slipped.
Herbalife (NYSE:HLF) -3.8% AH after a surprise GAAP loss.
Hewlett Packard Enterprise (NYSE:HPE) +12.1% AH topping estimates.
HP Inc. (NYSE:HPQ) +6.8% AH following upside guidance.
Newmont Mining (NYSE:NEM) -1.4% despite beating expectations.
In Asia, Japan +0.7%. Hong Kong +1%. China +0.6%. India +1%.
In Europe, at midday, London -0.2%. Paris -0.1%. Frankfurt +0.1%.
Futures at 6:20, Dow +0.4%. S&P +0.3%. Nasdaq +0.4%. Crude -0.4% to $62.54. Gold -0.1% to $1331.60. Bitcoin +4% to $10222.
Ten-year Treasury Yield -2 bps to 2.89%