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Frontrunning: October 1

  • European Bond Yields Go Negative (WSJ)
  • Traveler from Liberia is first Ebola patient diagnosed in U.S. (Reuters)
  • Hong Kong Protesters Step up Pressure on Leung to Quit (BBG)
  • JPMorgan to face U.S. class action in $10 billion MBS case (Reuters)
  • Turkey mulls military action against Islamic State (Reuters)
  • Singapore Home Prices Fall for Fourth Straight Quarter on Curbs (BBG)
  • Italy's Economic Woes Highlight Dilemma for European Central Bank (WSJ)
  • Advanced iOS virus targeting Hong Kong protestors (Reuters)
  • Fed Scrutiny of Leveraged Loans Grows Along With Bubble Concern (BBG)
  •  Mosquito Virus That Walloped Caribbean Spreads in U.S. (BBG)
  • But they were only overoptimistic: U.K. Regulator Investigates Tesco Accounting Error (WSJ)
  • Scraping the bottom of the barrel: Apple Said to Add Gold Option to IPad to Goose Sales (BBG)
  • Yesterday it was ISIS; Today it is Ebola. Tomorrow it will be... U.S. Takes Asteroid Threat Seriously (WSJ)
  • Mayor of Los Angeles Suburb Is Shot to Death in His Home (BBG)
  • U.S. lawmakers rebuke Secret Service over White House breach (Reuters)
  • Putin Reserve Rubles Vanish in Crimea Grab (BBG)
  • UPS-FedEx Ratio Offers Bet on U.S. Economy (BBG)


Overnight Media Digest


* The Secret Service came under withering criticism over the recent White House security breach and amid new revelations that an armed felon rode an elevator with President Barack Obama days earlier. (

* Federal health officials have confirmed that a patient being treated at a Dallas hospital has tested positive for Ebola. (

* A district-court judge dismissed claims brought against the federal government and U.S. officials for a decision to sweep nearly all of the profits of Fannie Mae and Freddie Mac to the U.S. Treasury. (

* Coming competition in paying for everyday purchases with smartphones, including an aggressive entry from Apple Inc , pushed online retailer eBay to reverse course and set free its PayPal unit. (

* Daniel Ivascyn, who was named Pacific Investment Management Co's group chief investment officer last week after Bill Gross abruptly quit, said he is still sitting among his colleagues in the middle of the trading floor, rather than at the head of the room where Gross sat. (

* European Union regulators said they believe that tax deals granted to Apple in Ireland and Fiat in Luxembourg constitute illegal state support for the companies. (

* Investors got an early peek at Puerto Rico's plan to raise $900 million in its first bond sale since March, with the publication of some bond information on a website. (

* U.S. office rents and occupancies inched higher in the third quarter, as a gradual improvement in the overall economy is translating into a sluggish recovery in the office sector. (

* Oil companies and railroads have united to fight some proposed federal rules on oil-train safety after a year of pointing fingers at each other over explosive accidents. Industry groups representing railroads and energy companies on Tuesday told the U.S. Transportation Department that they need more than two years to build safer railcars to haul crude. (

* The Federal Communications Commission is adopting a hard-sell strategy for next year's spectrum incentive auction in an effort to entice reluctant broadcasters to participate. At the auction, TV stations will take bids to sell their airwaves and either go out of business or be relocated to a new channel. (

* BlackRock Inc faces a possible fine in Germany for misrepresenting its stakes in almost 50 of the country's largest companies over several years, after the asset manager restated its holdings Tuesday. (



* Mario Draghi will push the European Central Bank to buy sets of Greek and Cypriot bank loans which have "junk" ratings, in a move that will increase tensions between Germany and the bank.

* A German regulator told Google Inc on Tuesday that profiling its users without their explicit consent is a breach of customer privacy. The regulator asked the company to take steps to ensure that users will be able to control the amount of data which is used for profiling.

* Deutsche Bank is withholding several million euros in bonuses from some current and former executives, as it tries to hold senior staff responsible for a number of expensive legal and regulatory problems.

* The UK Groceries Code Adjudicator, Christine Tacon, has asked Tesco Plc to inform her immediately if the company uncovers anything in its investigation relating to a 250 million pound ($405.35 million) profit overstatement that would breach the code that governs how supermarkets deal with their suppliers.

* The European Commission has argued that Ireland gave sustained state aid to Apple Inc. The commission claimed that in 1991 Ireland gave the iPad-maker favourable and potentially illegal terms which were apparently "motivated by employment considerations".



* EBay Inc announced on Tuesday that PayPal would be spun off as a separate publicly traded company, letting each of eBay's two main businesses chart its own course while maintaining most of their important business ties. (

* In a warning shot to companies shopping for tax deals around the globe, the European Commission publicly accused Ireland on Tuesday of giving illegal subsidies to Apple Inc and cautioned that the country might need to collect back taxes from the company, which outside analysts said could reach into the billions of dollars. (

* The Securities and Exchange Commission on Tuesday accused two men of possessing confidential information about plans by Pershing Square Capital Management to attack Herbalife Ltd . (

* Johnson & Johnson said on Tuesday that it would pay $1.75 billion in cash for Alios BioPharma, a private biotechnology company that is working on treatments for viral diseases. (

* News Corp, the publishing company controlled by Rupert Murdoch, agreed on Tuesday to buy Move Inc, an operator of real estate listings websites, for $950 million in cash, as the newspaper publisher continues to branch out into new businesses. (

* Remind, a start-up that links teachers and parents, said on Tuesday that it had raised $40 million from existing investors, led by Kleiner Perkins Caufield & Byers and joined by the Social+Capital Partnership and First Round Capital. (

* Consulting firm Bogdahn Group, which advises public and private pension funds that collectively hold more than $40 billion in assets, has counseled that its clients should withdraw their money from Pimco funds that had been managed by Bill Gross.




** German engineering group Siemens AG and Alberta construction company Studon Electric & Controls Inc, two companies on the Canadian federal government's list of employers that rely heavily on temporary foreign workers, are asking Ottawa to retract and correct information they say is false and potentially damaging. (

** Toronto mayoral candidate Doug Ford is continuing to target his attention at front-runner John Tory in the race to be mayor, releasing new radio ads directed at the former provincial PC leader and promising, if elected, to roll back the land transfer tax and speak up for often overlooked parts of the city such as Scarborough. (

** Ford Motor Co of Canada Ltd is adding 1,000 new jobs at its assembly plant in Oakville, Ontario, to build the redesigned Ford Edge crossover for global markets. The jobs are being created as the auto maker prepares to launch the new version of the vehicle early next year. (


** Canadian Prime Minister Stephen Harper left little doubt on Tuesday that MPs would shortly be called upon to approve a government proposal to go to war against the Islamic State of Iraq and Al Sham. A U.S. request for Canada to step up its involvement in the military campaign against the extremist group was the subject of closed-door presentations and a lengthy exchange in the House of Commons, although Harper said so decision had been made yet. (

** Toronto mayoral candidate Olivia Chow promised on Tuesday to create 3,000 more child care spaces, including 1,500 subsidized spots, if she is elected mayor, and then fielded questions about how she plans to arrest her downward trajectory in the polls. (

** The National Energy Board confirmed on Tuesday that it is investigating Plains Midstream Canada, an indirect subsidiary of pipeline company Plains All American Pipeline LP, which has been closely monitored by the Alberta Energy Regulator over two oil spills in the province dating back to 2011. An NEB spokeswoman said that Calgary-based Plains Midstream is not in compliance with a corrective action plan the NEB first demanded from the company after a 2010 audit. (




The Times

British warplanes launched their first air strikes at Islamic State targets in Iraq as the air campaign against the jihadists intensified. Two Tornados fired a precision-guided bomb and a missile in support of Kurdish forces who are fighting Islamist militants in the northwest of the country. (

Consumers have been warned that they may have to pay annual charges on debit and credit cards, as EU regulations threaten to end free banking in Britain. Economists fear that bank customers could also be charged to use cash machines and hold current accounts if plans to impose caps on the fees that card companies impose on retailers go ahead. (

The Guardian

David Cameron will on Wednesday try to prevent the health service becoming Labour's election-winning weapon when he guarantees that a majority Conservative government will protect the English NHS budget in real terms from 2015 to 2020. (

The wife of the Manchester taxi driver held hostage by Islamic State militants has begged the group to spare his life and allow him to return to his family. The emotional televised appeal by Barbara Henning was arranged by the Foreign Office on Tuesday, shortly before the Ministry of Defence announced that RAF aircraft had bombed Isis targets for the first time. (

The Telegraph

Magic 105.4 Radio DJ Dr Fox has been arrested on suspicion of historic sex assaults against two women, just after coming off-air from his radio show. The 53 year-old was detained at the station's central London studios, where he was presenting his daily breakfast show, just after coming off-air at 10 am on Tuesday. He remained in custody until being bailed late on Tuesday. (

The United Kingdom is 1,000 times more important than the European Union, Britain Prime Minister David Cameron has said. He added that he would not be heartbroken if Britain left the EU and the referendum on membership was a matter of "pragmatism". (

Sky News

A 15-year-old British girl thought to be trying to join militants in Syria may have been radicalised online, according to family friends. The girl from Bristol is believed to have met up with a 17-year-old girl from London and travelled to Turkey, where they are trying to cross the border into Syria. (

Spending on illegal drugs and prostitution was worth an estimated 12.3 billion pounds ($19.9 billion) to the UK economy last year, according to figures from the Office of National Statistics. (

The Independent

Olive oil could help reverse a patient's heart failure "immediately", scientists have claimed. Oleate - the fat found in the golden liquid - could help a diseased heart pump blood more effectively and use body fat as fuel, researchers at the University of Illinois have found. (

A British student found dead in Thailand was raped by two men while another watched before she was murdered, police have said. No suspects have yet been arrested for killing Hannah Witheridge, 23, and 24-year-old David Miller but three people are believed to be involved. (


Fly On The Wall Pre-Market Buzz


Domestic economic reports scheduled for today include:
ADP employment change for September at 8:15--consensus 205K
Markit manufacturing PMI for September at 9:45--consensus 57.9
ISM manufacturing for September at 10:00--consensus 58.5
Construction spending for August at 10:00--consensus up 0.5%



Allergan (AGN) upgraded to Buy from Hold at Stifel
Angie's List (ANGI) upgraded to Market Perform from Underperform at Northland
DeVry (DV) upgraded to Buy from Hold at Deutsche Bank
Dynegy (DYN) upgraded to Buy from Hold at ISI Group
Exelon (EXC) upgraded to Buy from Hold at ISI Group
Hecla Mining (HL) upgraded to Buy from Hold at BB&T
InvenSense (INVN) upgraded to Strong Buy from Buy at Needham
Janus Capital (JNS) upgraded to Buy from Hold at Jefferies
Masco (MAS) upgraded to Overweight from Neutral at JPMorgan
NRG Energy (NRG) upgraded to Strong Buy from Buy at ISI Group
Orbitz (OWW) upgraded to Outperform from Perform at Oppenheimer
Panera Bread (PNRA) upgraded to Buy from Hold at Wunderlich
TPG Specialty Lending (TSLX) upgraded to Outperform from Market Perform at Wells Fargo
Tyson Foods (TSN) upgraded to Neutral from Underperform at Credit Suisse


American Science & Engineering (ASEI) downgraded to Sell at CRT Capital
Comstock Resources (CRK) downgraded to Hold from Buy at Stifel
Dean Foods (DF) downgraded to Hold from Buy at BB&T
eBay (EBAY) downgraded to Hold from Buy at Jefferies
eBay (EBAY) downgraded to Market Perform from Outperform at JMP Securities
eBay (EBAY) downgraded to Neutral from Overweight at JPMorgan
Move, Inc. (MOVE) downgraded to Neutral from Buy at B. Riley
Tuesday Morning (TUES) downgraded to Neutral from Outperform at Credit Suisse


Actinium Pharmaceuticals (ATNM) initiated with a Buy at MLV & Co.
Adeptus Health (ADPT) initiated with an Outperform at RBC Capital
Antero Resources (AR) initiated with a Buy at Stifel
Freeport McMoRan (FCX) initiated with a Buy at Brean Capital
Tyco (TYC) initiated with a Neutral at Goldman
Vistaprint (VPRT) initiated with a Buy at SunTrust


General Mills (GIS) said it would cut 700-800 jobs in connection with Project Catalyst
Family Dollar (FDO) said proceeding with plans to be acquired by Dollar Tree (DLTR)
Companies developing Ebola treatments rose after CDC confirmed U.S. Ebola case (TKMR, SRPT, NLNK, BCRX)
Retrophin (RTRX) appointed Stephen Aselage as interim CEO
Real Goods Solar (RGSE) announced strategy to exit large commercial business
Ford Canada (F) to add over 1,000 new jobs at Oakville Assembly plant


American Realty (ARCP) sees FY15 AFFO $1.11-$1.14, consensus $1.15, revises FY14 AFFO view to $1.06-$1.08, consensus $1.10
Vornado (VNO) Q3 to include negative FFO of 9c from its 32.7% share of Toys “R” Us’
Synacor (SYNC) raises FY14 adjusted EBITDA view to ($1M)- breakeven from ($2.5M)-($1M), sees Q3 adjusted EBITDA ($0.5M)-$0.5M (FLWS) now sees FY15 EPS 45c-50c, may not compare to consensus 28c
Westport (WPRT) lowers FY14 revenue to $130M-$140M from $175M-$185, consensus $178.71M
American Science & Engineering (ASEI) sees Q2 net loss, consensus for Q2 EPS 21c
Aehr Test Systems (AEHR) reports Q1 EPS (6c) vs. 0c last year

Amazon (AMZN), Disney (DIS) appear to settle two-month dispute, WSJ reports
Angie's List (ANGI) exploring possibility of sale, exploring strategic options, FT reports
PayPal (EBAY) cut out of Apple Pay (AAPL) due to Samsung (SSNLF) partnership, Bank Innovation says
American Apparel (AAP) board open to letting ousted CEO Charney stay, Bloomberg reports
BNY Mellon to cease derivatives sales and trading, Bloomberg reports
Cisco (CSCO) could jump 50% with spin off, Barron's says

Can-Fite BioPharma (CANF) files $50M mixed securities shelf
EnerJex Resources (ENRJ) files $5.85M mixed securities shelf
Entegra Financial (ENFC) 6.546M share IPO priced at $10.00
Red Hat (RHT) files to sell $700M of convertible senior notes due 2019
Vital Therapies (VTL) files to sell 2.5M shares of common stock
Vivint Solar (VSLR) 20.6M share IPO priced at $16.00