Two-Thirds of Insurance Exchange Enrollees Paid Premiums (WSJ) Panic: Criminal Charges Against Banks Risk Sparking Crisis (BBG) Did the junk bubble pop: Junk Loans Pulled as Investors Say No After Fed Raises Concerns (BBG) CME mulls price fluctuation limits for gold, silver futures (Reuters) AT&T Has Approached DirecTV About Possible Acquisition (WSJ) NBA sets wheels turning for Clippers sale; Oprah in wings (Reuters) One way to fix prison overcrowding: Florida Jail Hit by Deadly Blast (WSJ) New Boeing jets hold key to more than half of future sales (Reuters) Sony slashes profit estimate by 70% (Guardian) Buffett Pressures Coca-Cola Over Executive Pay (WSJ) Two attackers among three killed in China bombing (Reuters) Ukraine's restive east slipping from government's grasp (Reuters) Hess, Mercuria Units Added to Brent Crude Price-Fixing Lawsuit (BBG)
Overnight Media Digest
WSJ
* AT&T has approached DirecTV about a possible acquisition of the satellite-TV firm, the latest sign of a possible shake-up in the television industry. A deal would likely be worth at least $40 billion, DirecTV's current market capitalization, a fraction of AT&T's $185 billion market capitalization. (http://r.reuters.com/qad98v)
* The Federal Reserve said Wednesday it would reduce its bond purchases to $45 billion a month and it was starting to see a growth pickup in recent weeks after a harsh winter that hit the U.S. economy. (http://r.reuters.com/ded98v)
* The Coca-Cola Co likely will revise its executive-compensation plan before it goes into effect next year, bowing to pressure from billionaire investor Warren Buffet. The potential changes come as a surprise after voting shareholders approved Coke's plan last week-and Buffett declined to vote against it. (http://r.reuters.com/fed98v)
* U.S. prosecutors are threatening to use what bank executives consider a nuclear option by filing criminal charges against two large foreign banks. Officials led by the Justice Department, though, are still trying to find a way to defuse the most catastrophic possible outcome of filing criminal charges: driving the banks out of business entirely. (http://r.reuters.com/ged98v)
* Alstom Chairman and Chief Executive Patrick Kron defied France's government by plunging ahead with plans to sell the country's industrial jewels to U.S.-based General Electric . France's economy minister portrayed the move as an act of national betrayal. (http://r.reuters.com/ped98v)
* The Federal Aviation Administration granted Boeing Co's request that the new 777 jetliner to be approved without a lengthy full recertification. (http://r.reuters.com/ked98v)
* Anheuser-Busch InBev NV's union workers Wednesday ratified a five-year contract that calls for wage increases and no plant closings, officials with the International Brotherhood of Teamsters said in a statement posted on the union's website. The contract, which union officials said would add some $2 billion in wages and benefits, is retroactive to March 1. It was the first contract Anheuser-Busch negotiated since its 2008 hostile-bid acquisition by InBev NV. (http://r.reuters.com/hed98v)
* Online-storage startup Box is delaying its plans for an initial public offering after a sudden weakening in demand for technology stocks. Box's March 24 IPO filing made it eligible to list shares as early as April, but people close to the company said the offering may not happen until June, and no timing has been set. (http://r.reuters.com/ned98v)
FT
GlaxoSmithKline's Chief Executive Andrew Witty all but ruled out a white knight bid for rival drugmaker AstraZeneca on Wednesday by reiterating scepticism on big takeover deals in the sector.
Britain's Reckitt Benckiser, which makes Durex condoms and Nurofen, has ended talks to buy Merck's consumer healthcare unit, paving the way for a rival to land the business behind Coppertone sun tan lotion.
Media baron Richard Desmond is planning to sell British broadcaster Channel 5 for 450 million pounds ($759.85 million) to U.S.-based Viacom, in a move that will see him receive more than four times his initial investment.
Rio Tinto is taking Vale and BSG Resources to court, alleging the rival mining groups were part of a conspiracy to steal its rights to an African iron ore deposit worth billions of dollars.
Microsoft's Xbox One is going to be the first foreign games console to be sold in China, after a 14-year ban on the devices was lifted in January.
NYT
* With the Republican-led filibuster of a Senate proposal to raise the federal minimum wage to $10.10 on Wednesday, Democrats moved swiftly to frame the vote as an example of the gulf that exists between the two parties on matters of economic fairness and upward mobility. (http://r.reuters.com/xad98v)
* Facebook Inc announced on Wednesday that when its 1.3 billion users log in to other websites or mobile apps through their Facebook identities, they will be able to limit what they reveal to the site or app to just their email addresses and public profile information, like name and gender. (http://r.reuters.com/wad98v)
* A federal regulator confirmed on Wednesday that the country's biggest banks committed widespread errors in dealing with homeowners who faced foreclosures at the height of the mortgage crisis, but the findings are unlikely to put to rest questions from lawmakers and others about the extent of the problems. (http://r.reuters.com/zad98v)
* The Federal Reserve continued to retreat from its stimulus campaign on Wednesday, saying it was looking past the economic slowdown during an unusually cold winter because growth already was rebounding. (http://r.reuters.com/bed98v)
* The utility operator Exelon Corp agreed on Wednesday to buy Pepco Holdings Inc for $6.8 billion in a bid to strengthen its operations on the East Coast. Under the terms of the deal, Exelon will pay $27.25 a share in cash, nearly 20 percent above Pepco's closing share price on Tuesday. (http://r.reuters.com/ced98v)
* The Federal Communications Commission's chairman delivered a tough message to cable and broadband executives Wednesday, saying a lack of competition in their industry has hurt consumers. The chairman, Tom Wheeler, said that the FCC intended to address the problem by writing tough new rules to enforce so-called net neutrality, preventing big broadband and cable companies from blocking access to innovative new technologies and start-ups that might emerge as competitors. (http://r.reuters.com/jed98v)
Canada
THE GLOBE AND MAIL
** Two workers were killed and two others injured as gunfire broke out at the Western Forest Products mill in Nanaimo in British Columbia. Royal Canadian Mounted Police said a lone gunman, a 47-year-old former employee who was later arrested at the scene, entered the mill yard carrying a shotgun and started shooting in the parking lot. (http://r.reuters.com/mud98v)
** A second video of Toronto Mayor Rob Ford smoking what has been described as crack cocaine by a self-professed drug dealer was secretly filmed in his sister's basement early Saturday morning. Ford declined to respond to questions about the video, his lawyer said the mayor was going to take a break from election campaigning. (http://r.reuters.com/pud98v)
Reports in the business section:
** Peter Munk stepped down as the chairman of Barrick Gold Corp on Wednesday. He founded the company three decades ago and turned it into the world's biggest gold producer. "You can take, maybe, Munk out of Barrick. You can't take Barrick out of Munk," he said at the company's annual meeting of shareholders. (http://r.reuters.com/rud98v)
NATIONAL POST
** Rumors about Beverley McLachlin, Chief Justice of the Supreme Court of Canada, are being shared with journalists, alleging she lobbied against the appointment of Marc Nadon to the court. It is also being suggested she has told people the Harper government has caused more damage to the court as an institution than any government in Canadian history. (http://r.reuters.com/xud98v)
** Canada is stepping into the increasingly tense showdown between Kyiv and Moscow over the future of eastern Ukraine by taking over leadership of an Organization for Security and Cooperation in Europe's military observer mission in the central European country. (http://r.reuters.com/zud98v)
FINANCIAL POST
** The Canadian federal government is expected to release details soon about the shape and size of a co-operative securities regulator that so far has the support of only Ontario and British Columbia. (http://r.reuters.com/cyd98v)
** The federal government asks Canadian telecom companies for private customer information about 1.2 million times each year, documents released Tuesday by the federal privacy commissioner's office show. (http://r.reuters.com/dyd98v)
Britain
The Telegraph
RECKITT BENCKISER BOWS OUT OF RACE FOR MERCK'S CONSUMER HEALTH ARM
Reckitt Benckiser has said it is no longer in discussions about buying U.S. pharma group Merck's consumer health business, leaving Germany's Bayer as the leading contender for the $14 billion business. (http://link.reuters.com/gyc98v)
ABU DHABI AND SOROS GOT 'GOLDEN TICKET' IN ROYAL MAIL SALE
Abu Dhabi Investment Authority, billionaire investor George Soros and activist hedge fund Third Point were among the 16 investors given preferential treatment in the controversial Royal Mail privatisation. (http://link.reuters.com/zeb98v)
ARGOS TO OPEN STORES IN HOMEBASE
Argos is to open concessions in Homebase stores and will also roll out a collection of small convenience stores in London as the retailer ramps up its fight with Amazon. (http://link.reuters.com/cub98v)
The Guardian
MORRISONS CUTS PRICE OF 1,200 PRODUCTS IN BID TO WIN CUSTOMERS BACK
A supermarket price war will move a step closer on Thursday as struggling Morrisons slashes the price of more than 1,200 products in an attempt to regain customers lost to cheaper discount chains. (http://link.reuters.com/hyc98v)
GLAXOSMITHKLINE KEEPS DISTANCE FROM BID FOR RIVAL ASTRAZENECA
GlaxoSmithKline has distanced itself from a white-knight bid for rival British drugs maker AstraZeneca , which has received an unwanted 60 billion pound ($101.31 billion) takeover approach from Pfizer of the United States. (http://link.reuters.com/qyc98v)
The Times
SERCO ON BRINK AS ANDREW JENNER, FINANCE DIRECTOR, QUITS
The finance director of Serco has left his job in the wake of a disastrous profit warning as the struggling outsourcing group plots an emergency fundraising to shore up its ailing balance sheet. (http://link.reuters.com/nyc98v)
PARIS MAY TAKE STAKE IN ALSTOM TO STOP GE
France's Socialist government hinted it could take a stake in Alstom to thwart General Electric's 12.35 billion euro ($17.12 billion) bid for the French group's power division. (http://link.reuters.com/ryc98v)
CHANNEL 5 SOLD FOR 450 MLN BY DESMOND
Media baron Richard Desmond is set to complete the sale of Channel 5 to U.S. broadcaster Viacom, the owner of MTV, for up to 450 million pounds. (http://link.reuters.com/pyc98v)
PENSION TAX FEAR AFTER EU RULING
Britain's ability to limit damaging decisions made by eurozone countries was called into question as the European Union's highest court threw out a challenge to a financial transactions some fear could wipe billions from UK pension funds. (http://link.reuters.com/myc98v)
STANDARD LIFE SHRUGS OFF THE IMPACT OF PENSION CHANGES
The British government's shock changes to pensions announced in this year's budget, which mean that those retiring do not automatically have to take out an annuity, has resulted in the halving in sales of such investment products at Standard Life , one of the biggest providers. (http://link.reuters.com/kyc98v)
The Independent
SAGA CUSTOMERS SIGN UP AHEAD OF 2.2 BLN STG FLOAT
Saga has revealed that 700,000 customers have registered to take part in its stock market listing as it aims to raise around 550 million pounds. (http://link.reuters.com/tyc98v)
LADBROKES POISED TO CUT JOBS AFTER TAX HIKE
Ladbrokes has warned it will make job cuts and store closures after the British government's surprise tax hike for bookmakers. (http://link.reuters.com/vyc98v)
Fly On The Wall 7:00 AM Market Snapshot
ECONOMIC REPORTS
Domestic economic reports scheduled today include: Jobless claims for week of April 26 at 8:30--consensus 320K Personal income for March at 8:30--consensus up 0.4% for the month ISM manufacturing index for April at 10:00--consensus 54.3 Construction spending for March at 10:00--consensus up 0.6% for the month
ANALYST RESEARCH
Upgrades
Abercrombie & Fitch (ANF) upgraded to Buy from Hold at Jefferies Barclays (BCS) upgraded to Buy from Neutral at UBS Cavium (CAVM) upgraded to Neutral from Reduce at Nomura Cengage Learning (CNGO) upgraded to Outperform from In-Line at Imperial Capital Citrix (CTXS) upgraded to Buy from Sell at Berenberg Exelon (EXC) upgraded to Buy from Hold at Deutsche Bank Exelon (EXC) upgraded to Market Perform from Underperform at Wells Fargo FARO Technologies (FARO) upgraded to Outperform from Neutral at RW Baird Flushing Financial (FFIC) upgraded to Buy from Neutral at Guggenheim ING Groep (ING) upgraded to Neutral from Underweight at HSBC JetBlue (JBLU) upgraded to Overweight from Neutral at JPMorgan KeyCorp (KEY) upgraded to Market Perform from Underperform at Bernstein National CineMedia (NCMI) upgraded to Buy from Neutral at B. Riley Pacific Biosciences (PACB) upgraded to Neutral from Underweight at JPMorgan Quaker Chemical (KWR) upgraded to Overweight from Equal Weight at First Analysis Regions Financial (RF) upgraded to Market Perform from Underperform at Bernstein Rocket Fuel (FUEL) upgraded to Equal Weight from Underweight at Evercore Synageva (GEVA) upgraded to Buy from Neutral at Janney Capital Synchronoss (SNCR) upgraded to Strong Buy from Outperform at Raymond James Synovus (SNV) upgraded to Equal Weight from Underweight at Morgan Stanley U.S. Silica (SLCA) upgraded to Buy from Hold at Jefferies Wright Medical (WMGI) upgraded to Strong Buy from Buy at Needham Yelp (YELP) upgraded to Outperform from Neutral at Macquarie Yelp (YELP) upgraded to Outperform from Sector Perform at RBC Capital Yelp (YELP) upgraded to Overweight from Neutral at Piper Jaffray
Downgrades
CEVA (CEVA) downgraded to Hold from Buy at Wunderlich CNO Financial (CNO) downgraded to Neutral from Buy at Goldman Clean Harbors (CLH) downgraded to Neutral from Outperform at RW Baird Coach (COH) downgraded to Underweight from Equal Weight at Morgan Stanley EXCO Resources (XCO) downgraded to Underperform from Sector Perform at RBC Capital Emulex (ELX) downgraded to Neutral from Overweight at Piper Jaffray Essilor (ESLOY) downgraded to Neutral from Buy at Citigroup GFI Group (GFIG) downgraded to Market Perform from Outperform at Keefe Bruyette Pepco Holdings (POM) downgraded to Market Perform from Outperform at Wells Fargo USA Compression (USAC) downgraded to Market Perform from Outperform at Wells Fargo
Initiations
Flowers Foods (FLO) initiated with an Outperform at Imperial Capital Navient (NAVI) initiated with an Equal Weight at Evercore
COMPANY NEWS
EQT (EQT) said it will sell Jupiter gathering system to EQT Midstream Partners (EQM) for $1.18B. EQT also signed an asset exchange agreement with Range Resources (RRC) and announced a 1M share repurchase authorization Weight Watchers (WTW) raised its FY14 earnings outlook to $1.45-$1.70 per share from $1.30-$1.60 Yelp (YELP), which gave a FY14 revenue outlook that topped current expectations, said Q1 cumulative reviews increased 46% to 57M Chevron (CVX) raised its quarterly dividend to $1.07 per share from $1.00 Abercrombie & Fitch (ANF) nominated four independent directors to board, announced settlement agreement with Engaged Capital, under which Engaged agreed to withdraw its notice of nomination of directors for election Aeropostale (ARO) said it will close 125 P.S. stores, cut 100 positions Starwood Hotels (HOT) CFO Vasant Prabhu resigned to become CFO of NBCUniversal (CMCSA)
EARNINGS
Companies that beat consensus earnings expectations last night and today include: Vical (VICL), Pacira Pharmaceuticals (PCRX), Swift Energy (SFY), Ball Corp. (BLL), Quanta Services (PWR), ExlService (EXLS), Calpine (CPN), CytRx (CYTR), Care.com (CRCM), Proto Labs (PRLB), Endo International (ENDP), Enterprise Products (EPD), Becton Dickinson (BDX), Cigna (CI), Orbotech (ORBK), Orion Marine (ORN), Republic Airways (RJET), Fleetmatics (FLTX), United Insurance (UIHC), Atwood Oceanics (ATW), La Jolla (LJPC), C&J Energy (CJES), Charles River Labs (CRL), Tesoro Logistics (TLLP), Tetra Tech (TTEK), Chesapeake Lodging (CHSP), Blackbaud (BLKB), Curtiss-Wright (CW), Lincoln National (LNC), Con-way (CNW), Digital River (DRIV), Glu Mobile (GLUU), Synageva (GEVA), Flextronics (FLEX), Amdocs (DOX), Williams (WMB), Weight Watchers (WTW), Atmel (ATML), Fidelity National (FNF), Shutterfly (SFLY), Intersil (ISIL), Cohu (COHU), Intrepid Potash (IPI), Accuray (ARAY), Western Digital (WDC), Manning & Napier (MN), First Bancorp (fbnc), Rovi (ROVI), Equinix (EQIX), Coherent (COHR), Cavium (CAVM), NCI, Inc. (NCIT), Hologic (HOLX), International Rectifier (IRF), Yelp (YELP), Green Dot (GDOT), Kratos Defense (KTOS), Whiting Petroleum (WLL), WebMD (WBMD), Roadrunner (RRTS), QuickLogic (QUIK)
Companies that missed consensus earnings expectations include:
Textron (TXT), Beazer Homes (BZH), Integra LifeSciences (IART), ACI Worldwide (ACIW), Genesee & Wyoming (GWR), Generac (GNRC), Heritage-Crystal Clean (HCCI), Buenaventura (BVN), Crocs (CROX), Xenith Bankshares (XBKS), SJW Corp. (SJW), American Railcar (ARII), Ashland (ASH), Terex (TEX), Orient-Express (OEH), Remy International (REMY), Hyster-Yale Materials (HY), North Valley Banc (NOVB), Stanley Furniture (STLY), Chemtura (CHMT), California Water Service (CWT), Stamps.com (STMP), Amerisafe (AMSF), Energy XXI (EXXI), Alphatec (ATEC), Hornbeck Offshore (HOS), Comfort Systems USA (FIX), Cabot (CBT), Oiltanking Partners (OILT), TTM Technologies (TTMI), Oplink Communications (OPLK), ManTech (MANT), inTEST (INTT), Williams Partners (WPZ), MedAssets (MDAS), TESARO (TSRO), McGrath RentCorp (MGRC), MetLife (MET), Martin Midstream Partners (MMLP), JDSU (JDSU), OncoGenex (OGXI), Forrester (FORR), American Equity (AEL), Boyd Gaming (BYD), Silicon Graphics (SGI)
Companies that matched consensus earnings expectations include:
Iron Mountain (IRM), MEDNAX (MD), Key Energy (KEG), Kirby (KEX), MDU Resources (MDU), Pilgrim's Pride (PPC), Allegion (ALLE), Jack Henry (JKHY), Macquarie Infrastructure (MIC), United Online (UNTD), Kona Grill (KONA), Endologix (ELGX), Portfolio Recovery (PRAA), ANADIGICS (ANAD), Dyax (DYAX), Pacific Biosciences (PACB), Sensar (SCII)
NEWSPAPERS/WEBSITES
AT&T (T) approached DirecTV (DTV) about possible takeover, WSJ reports Coca-Cola (KO) to amend executive pay after pressure from Buffett (BRK.A), WSJ says Winters says Coca-Cola (KO) compensation plan 'excessive,' Bloomberg reports Softbank (SFTBF) and Sprint (S) deal for T-Mobile (TMUS) not imminent, Re/code reports Rio Tinto (RIO) sues Vale (VALE), Steinmetz over iron-ore concession, WSJ reports Alibaba in talks with Alipay about regaining stake, NY Times reports Merck (MRK), Sanofi (SNY) exploring sale of off-patent drug assets, Reuters says Box's (BOX) IPO may be delayed until June or later, WSJ reports Twitter (TWTR) still looks expensive, Barron's says
SYNDICATE
Alphatec (ATEC) files to sell 10.25M shares of common stock for holders Apollo Commercial (ARI) files to sell 9M shares of common stock AxoGen (AXGN) files to sell $35M shares of common stock Burlington Stores (BURL) 12M share Secondary priced at $25.75 EQT Midstream Partners (EQM) files to sell 8.75M common units for limited partners Forum Energy (FET) 10M share Secondary priced at $29.00 Sterling Construction (STRL) announces bought deal offering of 2.1M shares Uranium Resources (URRE) files to sell 4.5M shares of common stock for holders
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