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May 18/a HRG BH IESC FSBC
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In Play from Briefing.com

Updated: 21-May-18 16:00 ET

15:52  CELG Celgene and Evotec enter into strategic oncology partnership (74.78 -3.59)

German biotech Evotec (EVOTF) and Celgene have entered into a long-term strategic drug discovery and development partnership to identify new therapeutics in oncology.

Evotec will receive an upfront payment of $65M and may be eligible to receive significant milestone payments as well as tiered royalties on each licensed programm. Celgene receives exclusive opt-in rights to license worldwide rights to all programmes developed within this collaboration.

15:23  BONDX Treasury Market Closing Summary

  • U.S. Treasuries followed suit to a certain degree with the pro-growth trade that lifted the stock market.  That trade had its origin in Treasury Secretary Mnuchin's acknowledgment that trade wars between the U.S. and China are "on hold."  Proposed tariffs will be halted as both sides continue to talk.  There were no specific details on the trade detente, although it was reported that China has said it will buy more goods from the U.S.  The perceived easing of trade tension fueled a risk-on rally in the stock market and some selling at the front end of the yield curve as it was thought the anticipated removal of a growth hurdle will keep the Fed on its rate-hike path.  The back end, however, held steady as the halting of tariff proposals assuaged some concerns about tariff-related inflation pressures.  The 10-2 spread narrowed three basis points to 50 basis points. Support for the back end was also provided by interest-rate differential trades and worries that a populist government coming to power in Italy could upend a needed sense of fiscal discipline there. That concern fostered a safe-haven trade in the German bund, which saw its yield drop six basis points to 0.52% while the yield on Italy's 10-yr BTP jumped 9 basis points to 2.41%.
  • Yield Check:
    • 2-yr: +3 bps to 2.57%
    • 5-yr: +1 bp to 2.90%
    • 10-yr: UNCH at 3.07%
    • 30-yr: UNCH at 3.21%
  • News:
    • Treasury Secretary Mnuchin says trade war with China "on hold." Previously announced tariffs to be halted as the two countries continue to talk.  China reportedly going to buy more goods from U.S., with emphasis on agricultural and energy imports, yet no specific details were provided.
    • Italy's Five Star Movement and the League reportedly poised to present a cabinet to Italy's president as the parties aim to establish a ruling coalition.  Worries continue to fester about populist agenda that harbors anti-euro sentiment and relaxed approach to fiscal discipline.
    • The Wall Street Journal highlights disparate moves in goods and services inflation that is creating a dilemma for Fed policymakers
    • Goldman Sachs chief economist, Jan Hatzius, issues report discussing risks of expanding U.S. budget deficit and debt level
  • Commodities
    • Oil: +1.4% to $72.26/bbl
    • Gold: -0.02% to $1290.90/troy oz.
    • Copper: +1.3% to $3.10/lb.
  • Currencies
    • USD/JPY +0.4% to 111.11
    • EUR/USD +0.03% to 1.1773
  • No U.S. economic data of note on today's calendar
  • The Day Ahead
    • No economic data of note
    • 13:00 ET: $33 bln 2-yr note auction
15:17  SUMRX Notable earnings out this afternoon/tomorrow morning

  • This afternoon: GSM NDSN PSTG
  • Tomorrow morning: AAP AZO CBRL CDAY DY EV IGT KSS PLAB TJX TOL
14:19  FOREX Currency Market Summary

Dollar Index Aiming for a Six-Pack

  • The U.S. Dollar Index is up 0.05% to 93.68, following course for its sixth straight gain. The greenback is drawing support from an easing of trade tension between the U.S. and China that prompted risk-on sentiment in the U.S. equity market.  Also continues to find support from the interest-rate differential trade and growing concerns surrounding the specter of a ruling coalition coming to office in Italy that pursues a populist agenda and harbors anti-euro sentiment.
  • EUR/USD: -0.04% to 1.1766
    • December low looming at 1.1718
    • Italy's Movimento 5 Stelle and Lega reportedly set to present a cabinet to Italy's president, prompting concerns about a populist agenda that will increase budget deficit
  • GBP/USD: -0.44% to 1.3410
    • Pound remains beneath 200-day moving average (1.3561)
    • Rightmove House Price Index +0.8% year-over-year (Prior +0.4%)
  • USD/CHF: +0.04% to 0.9981
  • USD/JPY: +0.31% to 111.10
    • Japan's April exports +7.8% year-over-year (expected +8.1%; Prior +2.1%); Imports +5.9% year-over-year (expected +9.6%; Prior -0.6%)
  • USD/CNY: +0.10% to 6.3849
  • USD/INR: +0.15% to 68.08
  • USD/RUB: -0.99% to 61.66
  • USD/TRY: +1.89% to 4.574
  • USD/BRL: -0.98% to 3.6997
  • USD/MXN: -0.42% to 19.8598
  • USD/ZAR: -0.30% to 12.7249
  • USD/CAD: -0.53% to 1.2816
  • AUD/USD: +0.75% to 0.7565
  • NZD/USD: +0.14% to 0.6923
14:16  REGN Regeneron Pharma announces publicaion in the New England Journal of Medicine of results from two Phase 3 trials for the investigational use of DUPIXENT in moderate-to-severe asthma (297.67 -4.14)

overall populations in both QUEST and VENTURE, with the largest benefit experienced in patients with more severe Type 2 inflammatory asthma, as evidenced by elevated blood eosinophils or exhaled nitric oxide levels. For the 52-week treatment period, the overall rate of adverse events was similar across treatment groups (81 percent in the combined DUPIXENT-treated group and 83 percent in the combined placebo-treated group). The rate of serious adverse events was 8 percent in the combined DUPIXENT-treated group and 8 percent in the combined placebo-treated group.
14:16  SESN Sesen Bio announces 'positive', three-month data from its ongoing Phase 3 VISTA Trial of Vicinium for the treatment of patients with high-grade non-muscle invasive bladder cancer (3.19 +0.19)

The efficacy data being reported are based on three-month follow-ups from 111 patients with high-grade NMIBC that is either carcinoma in situ (CIS), which is cancer found on the inner lining of the bladder that has not spread into muscle or other tissue, with or without papillary disease, or from patients with papillary disease without CIS, which is cancer that has grown from the bladder lining out into the bladder, but has not spread into muscle or other tissue.

  • In cohort 1, 72 patients were evaluable for three-month data as of the April 20, 2018 data cut-off date. In these patients, treatment with Vicinium demonstrated a complete response rate of 39 percent. In evaluable patients in cohort 2 (n=5), treatment with Vicinium demonstrated a complete response rate of 80 percent. In an analysis assessing pooled CIS patients from cohorts 1 and 2 (n=77), based on final U.S. Food and Drug Administration guidance on treatment of BCG-unresponsive CIS NMIBC patients (defined as patients with recurrent CIS within 12 months of adequate BCG therapy)1, Vicinium treatment resulted in a complete response rate of 42 percent at three months.
  • Patients with papillary disease without CIS were enrolled in cohort 3, but are not included in the primary endpoint assessment. At screening, all of these patients underwent mandatory resection of their tumors and upon starting treatment, were deemed to have no visible evidence of disease. As such, in this patient population, rates of disease recurrence and time to disease recurrence are standard criteria to evaluate response. In these evaluable patients (n=34), treatment with Vicinium demonstrated a 68 percent recurrence-free rate at three months.
  • To date, Vicinium has been well-tolerated in the VISTA Trial. In treated patients across cohorts (n=129), 72 percent of all adverse events were Grade 1 or 2. The most commonly reported treatment-emergent adverse events (all grades) were urinary tract infection (29%), dysuria (19%), hematuria (16%), pollakiuria (12%), diarrhea (10%), fatigue (10%), micronutrition urgency (9%), nausea (8%) and increased lipase (8%, all asymptomatic). Of the treatment-related adverse events, four percent were Grade 3 or 4, with no Grade 5 treatment-related adverse events. Four treatment-related serious adverse events were reported, including acute kidney injury or renal failure and cholestatic hepatitis.
13:41  URGN UroGen Pharma announces new findings from an interim analysis of the ongoing pivotal Phase 3 OLYMPUS clinical trial of UGN-101 (66.60 +1.27)

The interim analysis from this international, multi-center trial showed a complete response (CR) rate of 59 percent in 34 patients who were evaluated for primary disease evaluation (PDE, or the primary endpoint). Results showed that 20 of the interim analysis intent to treat population of 34 patients (59 percent) achieved a CR, defined as a negative ureteroscopic evaluation and a negative wash cytology. In addition, five of 34 patients (15 percent) achieved a partial response. Approximately 39 percent of tumors treated were categorized as unresectable by surgery at baseline. The CRs to date have been durable.

  • Of the 20 patients who achieved a CR, 13 patients have reached three-month follow-up and all remain in CR. Four of these 13 patients have reached six-month follow-up and one of the 13 patients has reached nine-month follow-up. All remain in CR.
  • UGN-101 appeared to be well-tolerated with most treatment-emergent adverse events characterized as mild or moderate and transient. These included urinary tract infection, flank pain, ureteral narrowing and hydronephrosis and time-limited creatinine elevation.

The OLYMPUS trial continues to enroll patients, and top-line results are expected in the second half of 2018.

13:04  WRAPX Midday Market Summary: Stocks Rally After U.S.-China Tariffs Put on Hold

Wall Street has kicked off the week on a positive note following weekend comments from Treasury Secretary Steven Mnuchin, who said that a trade war between the U.S. and China has been put on hold. The Dow is up 1.2%, the S&P 500 is up 0.7%, and the Nasdaq is up 0.6%. The small-cap Russell 2000, meanwhile, is up 0.6% and on track for its fourth straight record close.

Mr. Mnuchin's announcement followed last week's trade negotiations between Washington and Beijing, which reportedly ended with China agreeing to buy more goods from the U.S. to reduce the American trade deficit. While there wasn't a specific dollar amount attached to the additional Chinese purchases, the shelving of tariff threats between the world's two largest economies alone has been enough for buyers to re-enter the mix following modest losses for the equity market last week.

All 11 S&P sectors are in positive territory this afternoon, with industrials (+1.6%) leading the charge. Boeing (BA 364.01, +12.78), which has been a proxy for trade concerns, is up big (+3.6%), as is General Electric (GE 15.34, +0.38), which agreed to merge its transportation business with Wabtec (WAB 99.22, +4.03) in an $11.1 billion tax-free transaction. GE shares are higher by 2.4%.

Technology was neck and neck with industrials at the start of today's session, but has since fallen back in the sector standings. The group is still up 0.8%, helped by a 3.7% gain in shares of Micron (MU 55.35, +1.96), which raised its fiscal Q3 guidance ahead of today's investor day. Qualcomm (QCOM 57.17, -0.33) and NVIDIA (NVDA 243.83, -2.11) are lagging though, down around 0.8% apiece.

The health care sector is hovering near the bottom of today's leaderboard with a gain of 0.4%. Within the group, biotech shares are weak, pushing the iShares Nasdaq Biotechnology ETF (IBB 106.96, -0.84) lower by 0.8%, with biotech giant Celgene (CELG 75.56, -2.80) adding to its seven-month swoon, dropping 3.6% to a new four-year low.

In the bond market, U.S. Treasuries are flat to slightly lower today, with shorter-dated issues showing relative weakness. The yield on the benchmark 10-yr Treasury note is unchanged at 3.07%, while the yield on the 2-yr note is up three basis points at 2.57%. Yields move inversely to prices.

Meanwhile, the U.S. Dollar Index is struggling to advance after hitting a five-month high last week, and West Texas Intermediate crude futures are up 1.0% at $72.08 per barrel, which puts them on track for their best close since November 2014.

Investors did not receive any notable economic data today.

12:44  MNRO Monro Muffler provided FY19 guidance during conference call (55.78 -0.33)

  • Co issues guidance for FY19 (Mar), sees EPS of $2.30-2.40 vs. $2.58 Capital IQ Consensus Estimate; sees FY19 (Mar) revs of $1.17-1.20 bln vs. $1.18 bln Capital IQ Consensus Estimate; sees comps +1-3%
12:09  KSS Kohl's First Quarter Earnings Preview (64.24 +1.31)

  • Kohl's (KSS) is expected to report first quarter earnings tomorrow before the open.
  • There is a conference call scheduled for 9:00 (the company typically guides in the press release).
  • Q1 Capital IQ consensus calls for EPS of $0.50 (versus $0.39 last year) on revenue of $3.86 billion (+3% YoY).
  • Looking at comps, the company reported Q4 comps of +6.3% versus -2.2% last year. The Street is expecting Q1 comps to be near +2.7%. versus a -2.7% last year. The company reported Q4 gross margin of 33.8% versus 33.4% in Q4 of last year. The Street is expecting Q1 gross margins to be near 36.5% versus 36.4 last year.
  • The company is also expected to update its guidance for FY19 which currently stands at $4.95-5.45 for EPS and $18.9-19.3 billion for revenues. KSS is expecting comps to increase 0-2% with gross margins increasing 5 to 10 basis points over 2018.
  • Department store peer JC Penney (JCP) reported a beat on the bottom line but missed on revenues. The company also lowered its FY19 EPS guidance. On the other hand,
  • Macy's (M) is trading near a 52-week high after reporting comps up 3.2% and raising its full year sales and earnings guidance last week, citing broad-based strength in its business.
  • Analyst Notes: Following Q4, TAG said the company executed well in 4Q as comparable store sales increased 6.3%, on the back of a strong holiday (+6.9% in Nov/Dec) and a slower (but still positive) January, and margin performance was better than we expected. Inventory remains in very good shape, having exited the quarter down 7% in dollars and units on a per store basis. They found it encouraging that all businesses (and regions) posted positive sales results in 4Q, including women's apparel (~one-third of overall sales).
  • Based on the weekly KSS May25 $65 straddle, the options market is currently pricing in a move of ~8% in either direction by May expiration (Friday).
  • On a positive report, look for resistance near the $66.50-67.00 area, while support sits near the $63.00-63.50 vicinity.
  • Kohl's has a market cap of ~$11 billion and trades at ~12x earnings. DDS and JWN at 13x, M at 9x and a broad group of publicly traded retailers at 15x.
12:06  GSK GlaxoSmithKline receives US approval of Arnuity Ellipta for use in children from 5 years old who suffer from asthma (39.98 +0.05)

  • Co announced it has received approval from the FDA for the use of Arnuity Ellipta a once-daily inhaled corticosteroid medicine for the maintenance treatment of asthma in children from as young as 5 years. This makes Arnuity one of the few once-daily treatments for asthma licenced in the US in this younger age group, where there remains a significant need for convenient and effective treatment options.
11:33  SPY Stocks pare gains, set session lows but remain noticeably higher after trade dispute with China is put on hold; S&P 500 +0.6% (273.00 +1.66)

  • Industrials XLI +1.4%, Semiconductors SMH +0.9%, Financials XLF +0.8% and Energy XLE +0.7% lead while Metals XME -1.2% and biotech XBI -1% lag
09:40  WRAPX Opening Market Summary: Industrials Lead Broad-Based Rally

The major averages are higher in the opening minutes, sporting gains between 0.9% and 1.2%.

All 11 S&P sectors are in the green, with technology (+1.3%) and industrials (+1.4%) leading the charge. Within the industrial group, Dow components Boeing (BA 360.89, +9.71), General Electric (GE 15.32, +0.35), and Caterpillar (CAT 160.64, +4.94) are up big, holding gains between 2.3% and 3.2%.

Meanwhile, the lightly-weighted telecom services and real estate sectors are struggling, up just 0.1% apiece.

09:31  WIRES On The Wires

  • Magellan Midstream Partners, L.P. (MMP) to expand the western leg of its refined petroleum products pipeline system in Texas to handle incremental shipments of gasoline and diesel fuel to demand centers in Abilene, Midland/Odessa and El Paso, Texas, and New Mexico. The pipeline system can also access markets in Arizona and Mexico via connections to other pipelines.
09:25  BONDX European Summary

Italian Debt Remains Weak

  • European debt trades in mixed fashion on a day where a number of European markets are closed for the Whit Monday holiday, leading to thin trading conditions.  The focal point of debt traders, though, continues to be Italian debt, which continues to underperform on concerns about a populist ruling coalition coming to power and embracing a platform that is relaxed in terms of fiscal discipline.  Reports have indicated that the Five Star Movement and the League are poised to propose a cabinet today to Italy's president. 
  • European Economic Data:
    • UK's Rightmove House Price Index +0.8% month-over-month (Prior +0.4%)
  • Yield Check:
    • France, 10-yr OAT: -1 bp to 0.83%
    • Germany, 10-yr bund: -3 bps to 0.55%
    • Greece, 10-yr note: -4 bps to 4.49%
    • Italy, 10-yr BTP: +8 bps to 2.30%
    • Portugal, 10-yr PGB: +9 bps to 1.94%
    • Spain, 10-yr ODE: +5 bps to 1.48%
    • U.K., 10-yr gilt: -1 bps to 1.49%
09:18  LHO LaSalle Hotel: Pebblebrook (PEB) responds to LaSalle acquisition announcement, believes their offer is substantially superior to the merger agreement that LaSalle has reached with Blackstone (BX) (31.90 )

Pebblebrook is proposing to merge with LaSalle at a fixed exchange ratio of 0.9200 Pebblebrook common share for each LaSalle common share, with the option for LaSalle shareholders to elect to receive cash up to a maximum of 20% in the aggregate (subject to pro rata cutbacks). Based on Pebblebrook's closing share price on May 18, 2018, this implies an offer price of $35.89 per LaSalle common share, representing a premium of 7.1% over Blackstone's offer of $33.50 and a premium of 47.1% above LaSalle's closing price on March 27, 2018, which is the day before Pebblebrook publicly disclosed its initial offer of a business combination with LaSalle.

  • "We continue to believe that our offer maximizes immediate and long-term value for LaSalle's shareholders. The combination of Pebblebrook and LaSalle would create a hotel industry leader, particularly in the independent and lifestyle segment, and it would allow shareholders of both companies to benefit from Pebblebrook's management of the combined portfolio and the synergies that would result from bringing these two highly similar companies together. We are disappointed that LaSalle's board of trustees has chosen not to pursue the unique opportunity that we presented."
09:11  WRAPX S&P futures vs fair value: +14.80. Nasdaq futures vs fair value: +52.00.

The stock market is on track for a higher open, as the S&P 500 futures are trading 15 points, or 0.6%, above fair value.

This morning's bullish bias has been fueled by comments from Treasury Secretary Steven Mnuchin, who said that a trade war between the U.S. and China has been put "on hold" while the world's two largest economies work on a wider trade agreement. Mr. Mnuchin's statement follows a second round of trade talks between Washington and Beijing, which reportedly concluded with China agreeing to buy more goods from the U.S., including agricultural and energy products, but no specific dollar amount was given.

In corporate news, shares of General Electric (GE 15.38, +0.41) are up 2.7% in pre-market trading after the company agreed to a $11.1 billion deal to combine transport operations with Wabtec (WAB 95.00, -0.19). Meanwhile, shares of Micron (MU 56.33, +2.94) are up 5.5% after the chipmaker raised its quarterly guidance ahead of today's investor day, and shares of Fifth Third Bancorp (FITB 31.85, -1.71) are down 5.1% after the company agreed to acquire MB Financials (MBFI 50.65, +7.00) for roughly $4.7 billion in cash and stock.

In the bond market, U.S. Treasuries are ready to start the week on a flattish note, with the benchmark 10-yr yield unchanged from its Friday close of 3.07%. Elsewhere, WTI crude futures are up 0.3% at $71.57 per barrel, and the U.S. Dollar Index is up 0.1% at 93.66 as worries about a populist government in Italy continue to weigh on the euro.

09:01  CSGS CSG Systems appoints Rollie Johns as CFO effective May 17 (40.17 )

Johns' appointment as chief financial officer follows the previously announced retirement of former CFO Randy Wiese, who will stay at CSG as a non-executive through the transition of his duties
09:00  CERN Cerner adds $500 million to repurchase authorization (61.34 )

This expands the $500 million repurchase program that was approved on May 23, 2017, bringing the total authorized repurchase amount to $1 billion.
08:52  WRAPX S&P futures vs fair value: +15.30. Nasdaq futures vs fair value: +53.80.

The S&P 500 futures are trading 15 points, or 0.6%, above fair value.

Most major indices in the Asia-Pacific region gained ground on Monday, supported by U.S. Treasury Secretary Mnuchin's remark over the weekend that any trade war between the U.S. and China is "on hold" and that previously announced tariffs would be halted as the two countries continue to talk.  China will reportedly purchase more goods from the U.S., yet no specific amount was provided.  Japan's April trade report showed an uptick in exports and imports, yet both were weaker than economists expected.  Separately, it has been reported that President Trump and South Korean President Moon Jae-in talked over the weekend with regard to the upcoming June 12 summit with North Korea.

  • In economic data:
    • Japan's April exports +7.8% year-over-year (expected +8.1%; Prior +2.1%); Japan's April imports +5.9% year-over-year (expected +9.6%; Prior -0.6%)
    • Hong Kong's April CPI +1.9% year-over-year (Prior +2.6%)
    • South Korea's April PPI +0.1% month-over-month (Prior +0.4%); April PPI +1.6% year-over-year (Prior +1.3%)
    • New Zealand's Q1 retail sales +0.1% quarter-over-quarter (Prior +1.7%); core retail sales +0.6% quarter-over-quarter (expected +1.1%; Prior +1.8%)

---Equity Markets---

  • Japan's Nikkei added 0.3%, led by gains in Tokai Carbon (+5.2%), Fujikura (+3.7%), and Trend Micro (+3.6%).  Losers of note included NKSJ Holdings (-6.9%), Advantest (-4.1%), and MS&AD Insurance (-4.0%).
  • Hong Kong's Hang Seng added 0.6%, paced by advances in WH Group (+4.9%), AAC Technologies (+4.7%), China Merchants Ports Holdings (+3.3%), and Galaxy Entertainment (+2.5%).  China Shenhua Energy Corp. (-3.8%) was the biggest loser.
  • China's Shanghai Composite rose 0.6%, underpinned by gains in Jiangsu Zhongtian Technology (+10.0%), Hengtong Logistics (+10.0%), and China Science Publishing & Media (+10.0%). The biggest decliners on Monday were Harson Trading China (-4.3%) and Futures Land Holdings (-3.4%).
  • India's Sensex lost 0.7%, pressured by weakness in most components.  Sun Pharmaceutical Industries (-4.5%), Dr. Reddy's Labs (-4.2%), and Yes Bank (-3.3%) led the losers.  SBI (+2.5%) and Tata Consultancy (+1.6%) were the biggest gainers.

Major European indices are mostly higher, drafting off the positive buzz generated by the headline that any trade war between the U.S. and China is "on hold" for now.  Several markets in Europe, though, including Germany's DAX Index, were closed for the Whit Monday holiday.  Italy's FTSE MIB Index is open and continues to be weighed down by the specter of a coalition government run by the Five Star Movement and the League that is populist-oriented.  Reports suggest the coalition is poised to present a cabinet to President Mattarella as early as today and that law professor Giuseppe Conte is a frontrunner to be Prime Minister.  Italian bonds continue to be weak, along with the euro, which is at a five-month low (1.1758) against the dollar.

  • In economic data:
    • UK's Rightmove House Price Index +0.8% month-over-month (Prior +0.4%)

---Equity Markets---

  • UK's FTSE is up by 0.6%, underpinned by gains in the majority of its components.  The best-performing stocks are 3I Group (+3.3%), Burberry group (+2.6%), and J Sainsbury (+2.4%).
  • Germany's DAX is closed for Whit Monday holiday.
  • France's CAC trades up 0.5% and is also benefiting from gains in most components. Airbus Group (+2.5%), Carrefour (+2.5%), Pernod Ricard (+1.7%), Danone (+1.7%), and Publicis Groupe (+1.5%) sit atop the list of winners.  There isn't a single component down more than 1.0%.
  • Italy's MIB was down as much as 2.1%, but has recovered a sizable chunk of that loss and is currently down 0.8%. Intesa Sanpaolo (-6.4%), UnipolSai Assicurazioni (-6.1%), and Banca Generali (-4.0%) are downside leaders. Saipem (+3.6%), Fiat (+3.5%), and CNH industrial (+2.3%) are helping to offset the losses.
08:46  RYN Rayonier increases quarterly cash dividend to $0.27/share from $0.25/share (37.58 )

 
08:35  MU Micron up 4% after raising Q3 guidance ahead of Investor Day (55.39 )

Related stocks: SGH +3%, WDC +2%; semis: SMH +1.7%
08:33  PETX Aratana Therapeutics appoints directors in connection with a cooperation agreement with Engaged Capital (5.34 )

Craig Barbarosh will be a member of the Board's Compensation Committee and Lowell Robinson will be a member of the Audit Committee. Rip Gerber, a member of the Board, has resigned, and following these changes, Aratana's Board has been increased to ten members. Following these appointments, Engaged Capital has agreed to withdraw its previously nominated slate of directors for election at the Annual Meeting as part of a mutual cooperation agreement.
08:33  BIDU Baidu.com announces the divestiture of its global ad and tools business, which provides DU ads and tool apps, including Du Caller, Mobojoy, Photo Wonder and DU Recorder (253.01 )

Baidu will divest a majority equity stake in the Global DU business. Upon the completion of the transaction, Baidu will own ~34% of Global DU business's outstanding shares and no longer have effective control. The Global DU business is expected to be deconsolidated from Baidu's consolidated financial statements.
08:32  MU Micron boosts Q3 guidance ahead of Analyst and Investor Event citing strong execution and healthy industry conditions (53.39 )

  • Co now sees Q3 EPS of $3.12-3.16 (Prior $2.76-2.90) vs $2.84 Capital IQ Consensus Estimate; sees revs $7.7-7.8 bln (Prior $7.2-7.6 bln) vs $7.47 bln Capital IQ Consensus Estimate
  • "Our third quarter results are driven by focused execution of our strategy against a backdrop of healthy industry fundamentals," said Sanjay Mehrotra, president and CEO of Micron. "We look forward to discussing the significant opportunities ahead for Micron during our analyst and investor event later today."
08:32  MNLO Menlo Therapeutics announces data from an exploratory study of serlopitant for the treatment of chronic itch in epidermolysis bullosa patients (9.32 )

Efficacy at reducing itch was evaluated based upon a change in Numeric Rating Scale (NRS) itch score from baseline over the eight-week treatment period. After eight weeks of treatment, there was a numerically greater decrease in NRS itch score of 2.1 in the serlopitant treated group versus a decrease of 1.5 in the placebo treated group (p=0.11). More patients in the active group (43% vs. 14%) achieved at least a three-point reduction in NRS itch score by the end of treatment as compared to placebo.
08:31  WIRES On The Wires

  • Sequans Communications S.A. (SQNS) has been certified by Verizon for its Monarch SiP all-in-one, LTE-M/NB-IoT connectivity solution.
  • Inovio Pharmaceuticals (INO) initiates a Phase 2 clinical trial to evaluate the efficacy of VGX-3100 in adult men and women with human papilloma virus (HPV)-related anal dysplasia, a precursor to anal cancer. The study is planning to enroll approximately 24 patients and will administer at least three doses of VGX-3100.
  • Sears (SHLD) and Citi (C) announce the long-term extension of their 15-year co-brand and private label credit card relationship along with long-term marketing arrangements that include ongoing enhancements to the Shop Your Way Mastercard rewards program. These cardholders will automatically earn more Shop Your Way points.
08:31  DAR Darling Ingredients sells its Terra Renewal Services (TRS) industrial residuals business to American Residuals Group in approx. $80 mln cash transaction (18.18 )

 
08:26  WRAPX S&P futures vs fair value: +15.50. Nasdaq futures vs fair value: +48.30.

The S&P 500 futures are trading 16 points, or 0.6%, above fair value.

May has been a positive month for Wall Street thus far, with the major averages up between 2.5% and 4.1% month to date. Seven sectors are up for the month, with industrials (+4.1%), energy (+5.4%), materials (+5.0%), and technology (+5.7%) leading the charge. Conversely, four sectors are in the red, with utilities (-5.5%) being the weakest group.

Small caps have shown particular strength this month, pushing the Russell 2000 up 2.5%. The Russell 2000 has closed at a new record high for the last three sessions.

08:19  SCANX Gapping down

Gapping down
In reaction to disappointing earnings/guidance
:

  • QD -3.2%, CMCM -2.6%

M&A news:

  • FITB -5.2% (MB Financial to merge with Fifth Third Bancorp (FITB) in a transaction valued at $4.7 bln, or approximately $54.20/share in cash & stock)

Select metals/mining stocks trading lower:

  • SBGL -2.1%, GFI -1.7%, EXK -1.4%, GOLD -0.8%, X -0.6%, GDX -0.6%, GLD -0.5%

Other news:

  • GDDY -1.3% (announces underwritten public offering of 11,625,000 shares of its Class A common stock by certain of its stockholders)

Analyst comments:

  • CPB -1.2% (downgraded to Underperform from Neutral at BofA/Merrill)
  • QTWO -1.3% (downgraded to Hold from Buy at SunTrust)
  • MDSO -1.3% (downgraded to Equal-Weight from Overweight at Morgan Stanley)
  • AEO -1.6% (downgraded to Hold from Buy at SunTrust)
  • PRTA -3.7% (downgraded to Underweight at Barclays)
08:14  BONDX Overnight Treasury Market Summary

  • U.S. Treasuries are mixed this morning, with weakness at the front end and no change at the back end.  The curve flattening has narrowed the 10-2 spread to 51 basis points from 53 basis points on Friday.  Today's headlines being dominated by news that Treasury Secretary Mnuchin has said any trade war between the U.S and China is "on hold" as the two countries have a framework agreement that will enable a halt in proposed tariffs as the two sides continue to talk.  China reportedly going to buy more goods from U.S., but no specific details were provided.  There is no economic data of note today.  Dollar strength persists as worries about populist government coming to power in Italy continues to weigh on the euro.
  • Yield Check:
    • 2-yr: +2 bps to 2.56%
    • 5-yr: +2 bps to 2.91%
    • 10-yr: UNCH at 3.07%
    • 30-yr: UNCH at 3.21%
  • News:
    • Treasury Secretary Mnuchin says trade war with China "on hold." Previously announced tariffs to be halted as the two countries continue to talk.  China reportedly going to buy more goods from U.S., with emphasis on agricultural and energy imports, yet no specific details were provided.
    • Italy's Five Star Movement and the League reportedly poised to present a cabinet to Italy's president today as the parties aim to establish a ruling coalition.  Worries continue to fester about populist agenda and relaxed approach to fiscal discipline.
    • The Wall Street Journal highlights disparate moves in goods and services inflation that is creating a dilemma for Fed policymakers
  • Commodities
    • Oil: +0.04% to $71.30/bbl
    • Gold: -0.6% to $1283.90/troy oz.
    • Copper: +1.3% to $3.10/lb.
  • Currencies
    • USD/JPY +0.5% to 111.24
    • EUR/USD -0.1% to 1.1764
  • No Data on Today's Schedule
  • Fed Speakers:
    • 12:15 ET Atlanta Fed President Raphael Bostic (FOMC voter)
    • 14:15 ET Philadelphia Fed President Patrick Harker (non-FOMC voter)
    • 17:30 ET Minneapolis Fed President Neel Kashkari (non-FOMC voter)
08:13  SCANX Gapping up

Gapping up
In reaction to strong earnings/guidance
:

  • MNRO +3.4%

M&A news:

  • MBFI +14.7% (MB Financial to merge with Fifth Third Bancorp (FITB) in a transaction valued at $4.7 bln, or approximately $54.20/share in cash & stock), LHO +5% (confirms deal to be acquired by Blackstone (BX) for $33.50/share in cash), GE +2.3% (confirms deal to combine with GE's (GE) GE Transportation in $11.1 bln transaction), WAB +2.1% (confirms deal to combine with GE's (GE) GE Transportation in $11.1 bln transaction)

Select semi conductor related names showing strength:

  • NXPI +2.8%, MU +2.1%, STM +1.4%, AMD +1.3%, NVDA +1.2%, . 

Select China related names trading higher:

  • ACIA +3.8%, HX +2.9%, NPTN +2.3%, CAT +2.3%

Other news:

  • GLPG +3.5% (publication milestones on GLPG1690 in idiopathic pulmonary fibrosis)
  • RCKT +3% (reports continued clinical evidence demonstrates RP-L102 can restore bone marrow function of fanconi anemia patients without conditioning)
  • ARWR +2.5% (presents new data on ARO-ENaC, formerly referred to as ARO-Lung1)
  • EDIT +1.7% (reports new data for EDIT-101 demonstrating tolerance in non-human primates)
  • VYGR +1.2% (reports durable safety data generated with Voyager's novel AAV gene therapy capsids)

Analyst comments:

  • ACHN +5.4% (upgraded to Equal Weight from Underweight at Barclays)
  • AYX +2.1% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
  • KNX +2% (upgraded to Buy from Hold at Stifel)
  • SBRA +1.6% (upgraded to Outperform from Mkt Perform at Raymond James)
  • SNAP +1.5% (upgraded to Neutral from Sell at MoffettNathanson)
08:03  GHDX Genomic Health announces results from two new studies demonstrating the positive impact of the Oncotype DX Genomic Prostate Score test on risk assessment for better treatment decisions in clinically low-risk prostate cancer patients in real-world practice (38.56 )

One-year results from 770 patients demonstrated that use of the GPS test changed initial disease management (active surveillance versus definitive treatment) for 25 percent of patients, which is consistent with previously reported studies. Sixty-three percent of the GPS-tested patient population selected active surveillance compared to 40 percent of patients from a separate group of men who did not receive the test. Of men who selected active surveillance initially, 89 percent remained on active surveillance at one year.
08:03  HAFC Hanmi Financial held Hanmi Bank to acquire SWNB Bancorp (28.65 )

The acquisition is expected to expand Hanmi's market share and scale in key markets in Texas through SWNB's retail branch network strategically located in large Asian-American focused communities.

The transaction is expected to close late in the third quarter of 2018. Hanmi anticipates the acquisition will be accretive to earnings per share in 2019 and will generate a modest dilution to tangible book value of 1.5% with an earn-back period of approximately three years. The internal rate of return on this transaction will be in excess of 20%.

  • Important strategic benefits of the acquisition to Hanmi include:
    Increased operational scale and market share in key high-growth Texas markets with appealing demographic profiles; SWNB also brings a complementary branch network located in highly populated Asian-American communities.
  • Financially attractive transaction; Accretive to Hanmi's 2019 earnings per share.
  • Excess liquidity from SWNB (75% loan-to-deposit ratio) will be deployed through Hanmi's robust loan origination channels.
  • Anticipated ease of integration with little to no business disruption to SWNB's customer base.
08:02  IMMU Immunomedics submits a BLA to the FDA for sacituzumab govitecan for the treatment of patients with metastatic triple-negative breast cancer (mTNBC) who previously received at least two prior therapies for metastatic disease (20.99 )

 
08:02  XPER Xperi: Administrative Law Judge at the ITC issued a procedural ruling in the ITC Investigation against Samsung Electronics to terminate the ITC investigation (21.10 )

"This appears to be a procedural ruling on venue, and not a decision on the merits of Samsung's license defense," said Jon Kirchner, the Company's CEO. "While this may put off our ITC trial unless it is reversed, our other cases against Samsung are proceeding on schedule and will be heard beginning in the first quarter of 2019. Importantly, this decision has no impact on our 2018 billings guidance as our current guidance assumed no resolution of the outstanding Samsung legal matters."
08:01  LHO LaSalle Hotel confirms deal to be acquired by Blackstone (BX) for $33.50/share in cash (31.90 )

"As part of the Board's review, the Company and its advisors contacted 20 potential buyers, including strategic parties, brands and private equity firms. As a result, 10 potential buyers executed confidentiality agreements and received non-public information, and the Board engaged in extensive negotiations over price and terms. After careful consideration of multiple proposals received, the Board determined that this transaction represents the most compelling opportunity for LaSalle's shareholders, delivering a significant premium with immediate and certain cash value."
08:01  WRAPX S&P futures vs fair value: +15.00. Nasdaq futures vs fair value: +46.00.

The stock market is on course to begin the week with a bang. The S&P 500 futures are up 0.6%, the Nasdaq futures are up 0.7%, and the Dow futures are up 0.9%.

Today's upbeat tone follows Sunday comments from Treasury Secretary Steven Mnuchin, who said that a trade war between the U.S. and China has been put "on hold" while the world's two largest economies work on a wider trade agreement. Mr. Mnuchin's comments followed a second round of trade talks between Washington and Beijing, which reportedly concluded with China agreeing to buy more goods from the U.S., including agricultural and energy products, but no specific dollar amount was given.

Investors won't receive any notable economic data today, but there are several Fed speakers on the docket. Atlanta Fed President Raphael Bostic (voter), Philadelphia Fed President Patrick Harker (non-voter), and Minneapolis Fed President Neel Kashkari (non-voter) will be giving speeches this afternoon.

In the bond market, U.S. Treasuries are flat this morning, with the benchmark 10-yr yield unchanged at 3.07%. Elsewhere, WTI crude futures are up 0.1% at $71.35 per barrel, gold futures are down 0.6% at $1284/oz, and the U.S. Dollar Index is up 0.2% at 93.72, which marks a new five-month high.

In U.S. corporate news:

  • General Electric (GE 15.34, +0.37): +2.5% after agreeing to a $11.1 billion deal to combine transport operations with Wabtec (WAB 97.20, +2.01).

Reviewing overnight developments:

  • Most major indices in the Asia-Pacific region gained ground on Monday. Japan's Nikkei +0.3%, Hong Kong's Hang Seng +0.6%, China's Shanghai Composite +0.6%, India's Sensex -0.7%.
    • In economic data:
      • Japan's April exports +7.8% year-over-year (expected +8.1%; Prior +2.1%); Japan's April imports +5.9% year-over-year (expected +9.6%; Prior -0.6%)
      • Hong Kong's April CPI +1.9% year-over-year (Prior +2.6%)
      • South Korea's April PPI +0.1% month-over-month (Prior +0.4%); April PPI +1.6% year-over-year (Prior +1.3%)
      • New Zealand's Q1 retail sales +0.1% quarter-over-quarter (Prior +1.7%); core retail sales +0.6% quarter-over-quarter (expected +1.1%; Prior +1.8%)
    • In news:
      • U.S. Treasury Secretary Mnuchin said over the weekend that any trade war between the U.S. and China is "on hold" and that previously announced tariffs would be halted as the two countries continue to talk. China will reportedly purchase more goods from the U.S., yet no specific amount was provided.
      • It has been reported that President Trump and South Korean President Moon Jae-in talked over the weekend with regard to the upcoming June 12 summit with North Korea.
      • Japan's April trade report showed an uptick in exports and imports, yet both were weaker than economists expected.
  • Major European indices are mostly higher, drafting off the positive buzz generated by the headline that any trade war between the U.S. and China is "on hold" for now. UK's FTSE +0.7%, France's CAC +0.7%, Italy's MIB -0.7%. Germany's DAX is closed for Whit Monday.
    • In economic data:
      • UK's Rightmove House Price Index +0.8% month-over-month (Prior +0.4%)
    • In news:
      • Italy's FTSE MIB Index continues to be weighed down by the specter of a coalition government run by the Five Star Movement and the League that is populist-oriented. Reports suggest the coalition is poised to present a cabinet to President Mattarella as early as today and that law professor Giuseppe Conte is a frontrunner to be Prime Minister.
      • Italian bonds continue to be weak, along with the euro, which is at a five-month low (1.1758) against the dollar.
08:01  BAX Baxter increases financial guidance for 2020 and provides outlook for 2023 (adj. EPS $4.90-5.05) at Investor Day (70.60 )

Co at its investor conference, outlined the company's strategies to drive sustained growth, deliver attractive shareholder value and advance patient care around the world. Baxter defined its top-quartile goals around four key areas: patient safety and quality; growth through innovation; best place to work; and industry-leading performance; and its leadership team highlighted strategic growth opportunities across its six global businesses.

  • 2020: Baxter expects to grow sales 4 to 5% on a compounded annual basis at constant currency rates from 2018 through 2020. Through a relentless focus on disciplined financial management, operational excellence and accelerated innovation, the company now expects a 2020 adjusted operating margin of 20 to 21 percent and adjusted diluted earnings of $3.60 to $3.75 per share. Baxter also now expects free cash flow (operating cash flow less capital expenditures) of ~$2.1 billion in 2020.
  • 2023: The co expects sales to grow ~5% on a compounded annual basis at constant currency rates from 2018 to 2023. In 2023, the company anticipates an adjusted operating margin of 23 to 24 percent and adjusted diluted earnings of $4.90 to $5.05 per share. Baxter also expects to generate free cash flow of ~$2.65 billion in 2023.
07:42  WIRES On The Wires


  • Foundation Medicine, Inc. (FMI) approved for new Advanced Diagnostic Laboratory Test status for FoundationOne CDx under the Protecting Access to Medicare Act of 2014 the Centers for Medicare & Medicaid Services approved.
  • Accenture (ACN) patent by the United States Patent and Trademark Office for the ZBx AI Platform that supports the proprietary closed loop process that is central to a zero-based mindset, or ZBx.
  • Axon (AAXN) completes the industry's first center for artificial intelligence training on public safety data. The center's heightened level of security will enable law enforcement to take advantage of the benefits of artificial intelligence through Axon products while ensuring the data used to develop these systems is secure.
  • Qualcomm (QCOM) subsidiary Qualcomm Technologies, Inc., and Facebook (FB) are working together to deliver high-speed internet connectivity with Facebook's Terragraph technology through the development of a multi-node wireless system based on 60GHz technology from Qualcomm Technologies.  The companies expect to begin trials of the integrated solution mid-2019.
07:35  SUMRX European Markets Update: FTSE +0.7%, CAC +0.7%, DAX closed for holiday

Major European indices are mostly higher, drafting off the positive buzz generated by the headline that any trade war between the U.S. and China is "on hold" for now.  Several markets in Europe, though, including Germany's DAX Index, were closed for the Whit Monday holiday.  Italy's FTSE MIB Index is open and continues to be weighed down by the specter of a coalition government run by the Five Star Movement and the League that is populist-oriented.  Reports suggest the coalition is poised to present a cabinet to President Mattarella as early as today and that law professor Giuseppe Conte is a frontrunner to be Prime Minister.  Italian bonds continue to be weak, along with the euro, which is at a five-month low (1.1758) against the dollar.

  • In economic data:
    • UK's Rightmove House Price Index +0.8% month-over-month (Prior +0.4%)

---Equity Markets---

  • UK's FTSE is up by 0.7%, underpinned by gains in the majority of its components.  The best-performing stocks are 3I Group (+2.9%), Burberry group (+2.6%), and J Sainsbury (+2.4%).
  • Germany's DAX is closed for Whit Monday holiday.
  • France's CAC trades up 0.7% and is also benefiting from gains in most components. Airbus Group (+2.3%), Carrefour (+2.1%), Pernod Ricard (+1.9%), Danone (+1.6%), and Publicis Groupe (+1.5%) sit atop the list of winners.  There isn't a single component down more than 1.0%
  • Italy's MIB was down as much as 2.1%, but has recovered a sizable chunk of that loss and is currently down 0.7%. Intesa Sanpaolo (-6.2%), UnipolSai Assicurazioni (-6.0%), and Banca Generali (-4.0%) are downside leaders. Saipem (+4.1%), Fiat (+3.9%), and CNH industrial (+2.0%) are helping to offset the losses.
07:34  CDTX Cidara Therapeutics enters securities purchase agreement with certain investors providing for the purchase and sale, in a registered direct offering, of up to an aggregate of $120.0 million of its common stock (4.70 )

 
07:32  MAT Mattel intends to offer $500 mln additional private offering of 6.75% Senior Notes due 2025 (15.14 )

The Company intends to use the net proceeds from the sale of the New Notes, plus cash on hand, to redeem and retire all of its 2.350% Senior Notes due 2019 and pay related prepayment premiums and transaction fees and expenses.
07:32  NEE NextEra Energy to acquire Gulf Power, Florida City Gas and its ownership interests in the Oleander and Stanton natural-gas generating plants located in Florida in transactions valued at approximately $6.475 bln (156.45 )

The co announced it has entered into definitive agreements with Southern Company (SO) to acquire Gulf Power, Florida City Gas and its ownership interests in the Oleander and Stanton natural-gas generating plants located in Florida in transactions valued at approximately $6.475 billion, including the assumption of approximately $1.4 billion of Gulf Power debt. The companies are expected to benefit from NextEra Energy's industry-leading operating capabilities, with an intense focus on continuous improvement and a culture of innovation.

  • NextEra Energy expects the transactions to be immediately accretive to earnings upon closing and $0.15 and $0.20 accretive to its 2020 and 2021 adjusted earnings per share (EPS) expectations, respectively. As a result, upon closing of the transactions, NextEra Energy expects its 2020 adjusted EPS expectations to be in a range of $8.70 to $9.20 and its 2021 adjusted EPS expectations to be in a range of $9.40 to $9.95.
07:32  MYOK MyoKardia announces the design of its pivotal Phase 3 EXPLORER-HCM clinical trial to evaluate the use of mavacamten for the potential treatment of patients with symptomatic obstructive hypertrophic cardiomyopathy (51.75 )

The company has incorporated input on the study design from the Division of Cardiovascular and Renal Products of the U.S. Food and Drug Administration (FDA), and plans to conduct this single pivotal study along with a long-term extension study to support registration. MyoKardia expects to dose the first patient in the EXPLORER-HCM trial in the second quarter of 2018 and expects that data from the Phase 3 trial will be available in the second half of 2020. Co will host a conference call and live audio webcast today, May 21, 2018, at 8:30 a.m. ET / 5:30 a.m. PT to review the Phase 3 EXPLORER-HCM trial design.
07:31  NBRV Nabriva Therapeutics announces 'positive' topline results from its Lefamulin Evaluation Against Pneumonia clinical trial (shares halted) (5.43 )

In LEAP 2, lefamulin met the U.S. Food and Drug Administration (FDA) primary endpoint of non-inferiority (NI, 10.0% margin) compared to moxifloxacin for early clinical response (ECR) assessed 72 to 120 hours following initiation of therapy in the intent to treat (ITT) patient population. ECR was 90.8% for the 5-day treatment course of lefamulin and 90.8% for the 7-day treatment course of moxifloxacin (treatment difference 0.1 [95% confidence interval (CI) -4.4, 4.5]).

  • Lefamulin also met the European Medicines Agency (EMA) primary endpoint for non-inferiority (NI, 10.0% margin) compared to moxifloxacin based on an investigator assessment of clinical response (IACR) 5 to 10 days following the completion of study drug dosing in the modified intent to treat (mITT) and clinically evaluable at test of cure (CE-TOC) patient populations. IACR rates for the mITT population were 87.5% for lefamulin and 89.1% for moxifloxacin (treatment difference -1.6 [95% CI -6.3, 3.1]) and for the CE-TOC population were 89.7% for lefamulin and 93.6% for moxifloxacin (treatment difference -3.9 [95% CI -8.2, 0.5]).
  • Further analysis of the LEAP 2 trial results including analysis of additional patient population groups in the trial and secondary and exploratory endpoints related to these population groups is ongoing and additional results will be presented at upcoming scientific congresses.

"We are especially pleased with the high response rates for lefamulin in LEAP 1 and LEAP 2 and plan to file a New Drug Application with the FDA in the fourth quarter of 2018."

07:31  ARWR Arrowhead presents new data on ARO-ENaC, formerly referred to as ARO-Lung1, for the treatment of cystic fibrosis (10.00 )

The data presented included the following:

  • Integrin av6 receptor ligands improve endocytosis of RNAi triggers in cultured epithelial cells
  • Loss of airway epithelial aENaC protein expression is observed at exposures that produce approximately 50% reduction in whole lung aENaC mRNA, with remaining protein expressed in alveolar epithelium
  • Reduction of lung aENaC mRNA expression is durable, maintaining greater than the target level of 50% knockdown at 3 weeks post-dose and requiring 6-7 weeks for recovery to baseline expression
07:31  S&P futures vs fair value: +15.30. Nasdaq futures vs fair value: +47.80.

07:29  GHC Graham commences $400 mln private offering of senior notes (594.00 )

 
07:24  AFSI Amtrust Financial shareholder Arca Capital says will work with Carl Icahn and other minority shareholders in opposing the proposed privatization transaction (13.76 )

Arca Capital has long held the view that AmTrust Financial Services is a fundamentally strong business and has questioned the justification for its decline of over 50% since January 2017. During that 15 month period, the stock has declined from over $27 per share to under $13 per share amidst no significant changes to the business. While ordinary shareholders have lost retirement and college funds, Barry Zyskind and his in-laws are now trying to privatize the firm at what Arca believes is an absurdly low valuation.
07:16  CC Chemours commences public offering of senior notes (52.17 )

The net proceeds of the offering are expected to be used (i) to fund the purchase price and accrued and unpaid interest for up to $250 million of Chemours' outstanding 6.625% senior notes due 2023 and any and all of Chemours' outstanding 6.125% senior notes due 2023, (ii) to the extent applicable, to fund the redemption price and accrued and unpaid interest for any existing 2023 euro notes that remain outstanding after the completion or termination of the Tender Offers, and (iii) the remaining net proceeds, if any, for general corporate purposes.
07:04  AXGN AxoGen appoints President and CEO Karen Zaderej as Chairman effective immediately; Zaderej succeeds Jamie M. Grooms, who will remain a Director of the Board (43.95 )

 
07:04  SUMRX Asian Markets Close: Nikkei +0.3%, Hang Seng +0.6%, Shanghai +0.6%

Most major indices in the Asia-Pacific region gained ground on Monday, supported by U.S. Treasury Secretary Mnuchin's remark over the weekend that any trade war between the U.S. and China is "on hold" and that previously announced tariffs would be halted as the two countries continue to talk.  China will reportedly purchase more goods from the U.S., yet no specific amount was provided.  Japan's April trade report showed an uptick in exports and imports, yet both were weaker than economists expected.  Separately, it has been reported that President Trump and South Korean President Moon Jae-in talked over the weekend with regard to the upcoming June 12 summit with North Korea.

  • In economic data:
    • Japan's April exports +7.8% year-over-year (expected +8.1%; Prior +2.1%); Japan's April imports +5.9% year-over-year (expected +9.6%; Prior -0.6%)
    • Hong Kong's April CPI +1.9% year-over-year (Prior +2.6%)
    • South Korea's April PPI +0.1% month-over-month (Prior +0.4%); April PPI +1.6% year-over-year (Prior +1.3%)
    • New Zealand's Q1 retail sales +0.1% quarter-over-quarter (Prior +1.7%); core retail sales +0.6% quarter-over-quarter (expected +1.1%; Prior +1.8%)

---Equity Markets---

  • Japan's Nikkei added 0.3%, led by gains in Tokai Carbon (+5.2%), Fujikura (+3.7%), and Trend Micro (+3.6%).  Losers of note included NKSJ Holdings (-6.9%), Advantest (-4.1%), and MS&AD Insurance (-4.0%).
  • Hong Kong's Hang Seng added 0.6%, paced by advances in WH Group (+4.9%), AAC Technologies (+4.7%), China Merchants Ports Holdings (+3.3%), and Galaxy Entertainment (+2.5%).  China Shenhua Energy Corp. (-3.8%) was the biggest loser.
  • China's Shanghai Composite rose 0.6%, underpinned by gains in Jiangsu Zhongtian Technology (+10.0%), Hengtong Logistics (+10.0%), and China Science Publishing & Media (+10.0%). The biggest decliners on Monday were Harson Trading China (-4.3%) and Futures Land Holdings (-3.4%).
  • India's Sensex lost 0.7%, pressured by weakness in most components.  Sun Pharmaceutical Industries (-4.5%), Dr. Reddy's Labs (-4.2%), and Yes Bank (-3.3%) led the losers.  SBI (+2.5%) and Tata Consultancy (+1.6%) were the biggest gainers.

---FX---

  • USDJPY +0.5% to 111.32
  • USDCNY +0.1% to 6.3849
  • USDINR +0.2% to 68.13
07:03  NR Newpark Res appoints Anthony J. Best as Chairman effective May 17, 2018, succeeding David C. Anderson (10.70 )

Best joined the Company's Board of Directors in March 2014 and has served as Chairman of the Compensation Committee as well as a member of the Audit and Nominating and Corporate Governance Committees.
07:03  QURE uniQure presents data showing successful liver transduction with the AAV5 vector in both non-human primates and humans with pre-existing anti-AAV5 neutralizing antibodies (31.31 )

Using a highly-sensitive, luciferase-based anti-AAV5 NAB assay, uniQure researchers re-analyzed the pre-treatment sera of the ten patients who entered the Phase I/II gene therapy clinical trial of AMT-060. Seven of the ten patients returned results below the limit of detection of the assay, and three of the ten had positive anti-AAV5 NAB titers, of whom two were confirmed positive by additional assays. Yet no relationship was determined between the presence of pre-treatment anti-AAV5 NABs and clinical outcomes in the trial. In particular, the patient with the highest anti-AAV5 NAB titer (340) presented the highest mean FIX activity in his dose cohort. Neither of the two patients with confirmed positive anti-AAV5 NABs experienced elevated liver enzymes. Additionally, no clinically relevant T-cell immune responses to the capsid were detected in any of the ten patients.
07:01  FEYE FireEye to offer $525 mln aggregate principal amount of convertible senior notes due 2024 (17.80 )

FireEye expects to use a portion of the net proceeds of the offering of the notes to pay the cost of capped call transactions described below and to use the remaining proceeds of the offering to repurchase, in separate, privately negotiated transactions, a portion of FireEye's 1.000% Convertible Senior Notes due 2035 concurrently with this offering and for general corporate purposes, including capital expenditures, investments, working capital, retirement of debt securities and potential acquisitions and strategic transactions. FireEye has no definitive agreements with respect to any such acquisitions or transactions at this time.
07:00  FFIV F5 Networks appoints Frank J. Pelzer as CFO; Pelzer joins F5 from SAP, where he was President and Chief Operating Officer of the Cloud Business Group (172.27 )

 
07:00  WAB Wabtec confirms deal to combine with GE's (GE) GE Transportation in $11.1 bln transaction (95.19 )

Under the agreement, which has been approved by the Boards of Directors of Wabtec and GE, GE will receive $2.9 billion in cash at closing and GE and its shareholders will receive a 50.1% ownership interest in the combined company, with Wabtec shareholders retaining 49.9% of the combined company. The transaction is expected to be tax free to the companies' respective shareholders.

  • Both companies are expected to benefit from the cyclical tailwinds they are experiencing as industry conditions improve. GE Transportation revenues and EBIT are expected to grow at double digit CAGRs from 2017A to 2019E as the cycle rebounds from trough levels. The GE Transportation business is positioned for a significant rebound, with estimated adjusted EBITDA growing from about $750 million in 2018 to between $900 million and $1 billion in 2019. The backlog of approximately $18 billion includes about 1,800 new locomotives and approximately 1,000 to be modernized. GE Transportation has received $3.6 billion in orders in the last two quarters. Wabtec reported a strong Q1, also forecasting robust growth for the year with record backlog.
  • Based on Wabtec's stock price on April 19, 2018, the last unaffected trading day prior to media speculation regarding a potential transaction, the value of the transaction is approximately $11.1 billion. When adjusted for the net tax step-up value of $1.1 billion accruing to the combined company, the transaction value is $10 billion. The transaction is expected to be tax free to the companies' respective shareholders.
06:58  S&P futures vs fair value: +16.00. Nasdaq futures vs fair value: +48.30.

06:58  European Markets

FTSE...7839.81...+61.00...+0.80%.  DAX...13077.72...-36.90...-0.30%.
06:58  Asian Markets

Nikkei...23002.37...+72.00...+0.30%.  Hang Seng...31234...+186.40...+0.60%.
06:57  ROP Roper to acquire PowerPlan in $1.1 bln deal (275.47 )

PowerPlan is a leading provider of software and solutions for asset-centric companies, enabling its customers to optimize their financial performance and achieve regulatory compliance. During the first 12 months of ownership, Roper expects PowerPlan to deliver approximately $150 million of revenue and $60 million of after-tax free cash flow, excluding the impact of fair value accounting for PowerPlan's deferred revenue and financing costs. Roper anticipates funding the transaction using its revolvingcredit facility and cash on hand, and expects the acquisition to be immediately cash accretive. PowerPlan has a strong history of growth in revenue, EBITDA, and cash flow, which Roper expects to continue.
06:56  WIRES On The Wires

  • Woori Bank (WF) has undertaken a review of the necessity, effects, process and related considerations with respect to the formation of a holding company, for purposes of increasing its management efficiency and diversifying its businesses. As a result of such review, Woori Bank has concluded that it is necessary to adopt a holding company structure in order to secure its competitiveness as a comprehensive financial group, and plans to proceed with the establishment of a holding company with a target launch date of early 2019.
  • The Janssen Pharmaceutical Companies of Johnson & Johnson (JNJ) presented post-hoc analysis from the Phase 3 SPARTAN study that showed treatment with ERLEADA (apalutamide) significantly reduced the risk of prostate specific antigen progression in patients with non-metastatic castration-resistant prostate cancer (nmCRPC) who had a rapidly rising PSA while receiving continuous androgen deprivation therapy (Abstract PD10-11).
  • Gridsum Holding Inc. (GSUM) announced that it has signed SFbest.com, a subsidiary of SF Holding Company Limited, as a new client.
  • Alliance One International, Inc. (AOI) announced that its Canadian Prince Edward Island-based indirect subsidiary, Canada's Island Garden, will undergo a significant expansion to support the growth of its Canadian cannabis line. This state-of-the-art expansion will increase Canada's Island Garden's production capacity of medicinal cannabis, and recreational cannabis as and when sales for the recreational adult market are legalized.
  • Lannett Company, Inc. (LCI) announced that it received approval from the U.S. Food and Drug Administration of its Abbreviated New Drug Application A) for Dronabinol Capsules USP, 2.5 mg, 5 mg and 10 mg, the therapeutic equivalent to the reference listed drug, Marinol Capsules 2.5 mg, 5 mg and 10 mg of AbbVie Inc. For the 12 months ended March 2018, total U.S. sales of Dronabinol Capsules USP, 2.5 mg, 5 mg and 10 mg, was approximately $120 million, according to IMS.
06:55  CMCM Cheetah Mobile beats by RMB 0.03, beats on revs; guides Q2 revs below two analyst estimate (12.32 )

  • Reports Q1 (Mar) earnings of RMB 0.48 per share, excluding non-recurring items, RMB 0.03 better than the two analyst estimate of RMB 0.45; revenues fell 3.8% year/year to RMB 1.15 bln vs the RMB 1.13 bln single analyst estimate.
  • Co issues downside guidance for Q2, sees Q2 revs of RMB 1.02-1.08 bln vs. RMB 1.14 bln two analyst estimate.
06:32  MBFI MB Financial to merge with Fifth Third Bancorp (FITB) in a transaction valued at $4.7 bln, or approximately $54.20/share in cash & stock (43.65 )

Based on the closing price of Fifth Third's common shares on May 18, 2018, common shareholders of MB Financial will receive $54.20 of total consideration, consisting of 1.45 shares of Fifth Third common stock and $5.54 in cash for each share of MB Financial common stock. The consideration implies a premium of approximately 24 percent to MB Financial's closing share price on May 18, 2018. In conjunction with the closing of the transaction, two members of MB Financial's Board of Directors are expected to join the Fifth Third Bancorp Board.

  • "In addition to its strategic importance, this merger is expected to drive significant financial benefits. We expect our investment to generate an IRR of approximately 18.5 percent and to be accretive to our operating EPS in the first year, with accretion of nearly 7 percent in the second year, once cost savings are fully realized. Furthermore, we not only expect the merger to accelerate our progress towards our NorthStar financial targets but also raise them above our previous guidance" -- Greg D. Carmichael, chairman, president and CEO of Fifth Third Bancorp.
  • Fifth Third intends to complete its 2017 CCAR buyback plan by repurchasing up to $235 million of its shares of common stock before the beginning of the proxy solicitation in connection with the MB Financial shareholder vote on the transaction, and, subject to regulatory approvals, may repurchase additional shares after the vote.
06:32  MNRO Monro Muffler beats by $0.02, reports revs in-line; increases quarterly dividend to $0.20/share from $0.18/share; acquires Free Service Tire Company (56.10 )

  • Reports Q4 (Mar) earnings of $0.52 per share, $0.02 better than the Capital IQ Consensus of $0.50; revenues rose 13.3% year/year to $285.6 mln vs the $286.08 mln Capital IQ Consensus.
  • The Company also announced today that its Board of Directors has approved a $.02 increase in the Company's cash dividend for the first quarter of fiscal year 2019 to $.20/share.
  • Co also acquired Johnson City, Tennessee-based Free Service Tire Company; terms not disclosed
06:27  WIRES On The Wires

  • The New York Stock Exchange, part of Intercontinental Exchange (ICE), announced that NYSE National, a new electronic equities exchange, will commence trading on Monday, May 21, 2018.
  • Celanese Corporation (CE) will increase list and off-list selling prices for Emulsion Polymers and Acetyls Products. The price increases below will be effective for orders shipped on or after June 1, 2018, or as contracts otherwise allow.
  • iClick Interactive Asia Group (ICLK) announced a strategic growth initiative to extend the Company's business scope to providing business intelligence solutions based on big data analytics for enterprises. This is an important step for iClick Interactive as it invests in opportunities beyond its core programmatic marketing operations. Developing BI capabilities meets the latent needs of brands to maximize the value of their proprietary data and to gain actionable insight from such data.
06:26  SNY Sanofi presents initial clinical data for BIVV001 for people with hemophilia A (38.88 )

Preliminary safety and pharmacokinetic data from the ongoing EXTEN-A Phase 1/2a study showed that a single low dose of BIVV001 extended the half-life of factor VIII to 37 hours with high factor activity levels, and was generally well tolerated. The data were presented at a late-breaking session at the World Federation of Hemophilia (WFH) 2018 World Congress being held in Glasgow, Scotland.
06:25  NRG NRG Energy to commence an offering of $500 mln in aggregate principal amount of its convertible senior notes due 2048 (33.71 )

  • NRG intends to use cash on hand and the proceeds from the offering, including any proceeds from the exercise of the 30-day option, to repay a portion of its outstanding indebtedness and to pay fees and expenses related to the offering and incurred in connection with its repayment of indebtedness. As a result, the Notes offering is expected to be leverage neutral.
  • In connection with the offering of the Notes, NRG intends to use cash on hand to repurchase shares of its common stock in an aggregate amount to complete NRG's previously announced $500 million share repurchase program.
06:18  VYGR Voyager Therapeutics reports durable safety data generated with Voyager's novel AAV gene therapy capsids (18.76 )

  • Co announced additional data presentations at the American Society of Gene and Cell Therapy
  • Presentation for novel gene therapy capsids
    • At this year's ASGCT meeting, one and three-month safety data on novel capsids were presented demonstrating good tolerability, based on in-life observations, clinical chemistry and histopathology in 26 non-human primates. Voyager continues to conduct additional studies in non-human primates with these and other novel AAV capsids to optimize delivery of genes to regions critical for the treatment of amyotrophic lateral sclerosis (ALS), Parkinson's disease and Friedreich's ataxia (FA), as well as other severe neurological diseases.
  • Presentation for Voyager's preclinical Friedreich's ataxia program:
    • In the rotarod test at 15.5 weeks of age, and at the highest dose, the mouse receiving Voyager's frataxin gene therapy vector maintained out to one year the time spent on the rotarod at approximately 200 seconds compared to a decline to 40 seconds in the diseased (knockout) mouse. For the notched-bar traversing test, at the highest dose, Voyager's frataxin gene therapy vector prevented progression of ataxia, reducing the number of foot slips out to one year when compared to those observed in the knockout mouse. Additional preclinical studies are underway at Voyager including steps to optimize a lead clinical candidate for the treatment of FA.
06:17  WIRES On The Wires

  • iClick Interactive Asia Group Limited (ICLK) announced a strategic growth initiative to extend the Company's business scope to providing business intelligence solutions based on big data analytics for enterprises. This is an important step for iClick Interactive as it invests in opportunities beyond its core programmatic marketing operations.
  • The Janssen Pharmaceutical Companies of Johnson & Johnson (JNJ) announced that the European Commission has granted marketing authorisation for JULUCA (dolutegravir 50mg [ViiV Healthcare]/rilpivirine 25mg [Janssen Sciences Ireland UC]). ViiV Healthcare, as the marketing authorisation holder, will market dolutegravir/rilpivirine in all countries in the European Union and European Economic Area.
  • NSM Insurance Group, a subsidiary of White Mountains Insurance Group (WTM), announced that their UK arm, Vantage Holdings, has acquired Fresh Insurance Services Group Limited. Fresh Insurance is an insurance broker based in Redditch, West Midlands that specializes in non-standard personal lines products, motor trade, van, and travel insurance.
  • Veracyte, Inc. (VCYT) announced that early user-experience data from three independent studies demonstrate that the next-generation Afirma Genomic Sequencing Classifier (GSC) significantly increases the number of patients who can avoid unnecessary surgery in thyroid cancer diagnosis, compared to the original, market-leading Afirma Gene Expression Classifier. The findings were presented today during poster sessions at the AACE 27th Annual Scientific & Clinical Congress, being held May 16-20 in Boston.
  • Barclays (BCS) announces that the Crown Court has today dismissed all charges brought by the Serious Fraud Office against Barclays PLC and Barclays Bank PLC regarding matters which arose in the context of Barclays' capital raisings in 2008.
06:17  GSK GlaxoSmithKline: ViiV Healthcare receives EU marketing authorisation for Juluca the first 2-drug regimen, once-daily, single-pill for the treatment of HIV (40.03 )

  • ViiV Healthcare, the global specialist HIV company, majority owned by GlaxoSmithKline (GSK), with Pfizer (PFE). and Shionogi Limited as shareholders announced that the European Commission has granted marketing authorisation for Juluca for the treatment of human immunodeficiency virus type 1 (HIV-1) infection in adults who are virologically suppressed (HIV-1 RNA <50 copies/mL) on a stable antiretroviral regimen for at least six months with no history of virological failure and no known or suspected resistance to any non-nucleoside reverse transcriptase inhibitor or integrase inhibitor.
06:15  SLDB Solid Biosciences presents new preclinical data from its gene therapy development programs for Duchenne muscular dystrophy (21.89 )

New data for SGT-001, the Company's lead microdystrophin gene transfer candidate, further demonstrate its potential to produce long-term and body-wide microdystrophin expression that correlates with significant improvements in muscle function. Additionally, the Company presented data supporting the development of novel promoters and capsids as part of its next generation gene therapy discovery efforts.
06:12  GLPG Galapagos NV announces publication milestones on GLPG1690 in idiopathic pulmonary fibrosis (97.59 )

FLORA was an exploratory, randomized, double-blind, placebo-controlled trial investigating a once-daily oral dose of GLPG1690. The drug candidate was administered for 12 weeks in 23 IPF patients, 17 of whom received GLPG1690 and 6 of whom received placebo. Over the 12-week period, patients receiving GLPG1690 showed an FVC increase of 8 mL, while patients on placebo showed an FVC reduction of 87 mL (mean from baseline). GLPG1690 was well-tolerated by IPF patients in the FLORA trial. In addition to presenting three abstracts on investigational drug GLPG1690 at the American Thoracic Society Meeting (ATS) from 18 to 23 May in San Diego, California, USA, Galapagos announces the publication of the FLORA Phase 2a study results in the most recent issue of The Lancet Respiratory Medicine.
06:11  GDDY GoDaddy announces underwritten public offering of 11,625,000 shares of its Class A common stock by certain of its stockholders (71.34 )

Selling stockholders participating in the offering consist of entities affiliated with Kohlberg Kravis Roberts & Co. L.P. (KKR), Silver Lake Partners and YAM Special Holdings, Inc., an entity owned by GoDaddy founder, Bob Parsons. Additionally, GoDaddy's chief executive officer is offering 125,000 shares of GoDaddy's Class A common stock in the offering.
06:10  EPE EP Energy prices $1.0 bln of 7.750% Senior Secured Notes due 2026 (3.28 )

 
06:10  QD Qudian reports Q1 results (11.48 )

  • Co reports Q1 adjusted EPS of $0.16 versus $0.25 Capital IQ consensus; revs +105.6% YoY to $273.7 mln (no comparable ests)
  • For the full year of 2018, the Company currently expects:
    • Adjusted net income to be more than RMB2.5 billion; and
    • Number of vehicles leased out to be more than 100 thousand.
06:10  KOS Kosmos Energy provides update on current activity in Suriname -- anticipates drilling starting in the third quarter of this year (7.83 )

The Anapai-1 well drilling in Block-45 offshore Suriname encountered shallow bore hole stability issues before reaching the target interval. Kosmos and its partner will re-spud the well, Anapai-1A, targeting the same objectives. The well design has been reconfigured to address the issues previously encountered. Anapai-1A is expected to spud imminently, and will take approximately 50 to 60 days to drill with results expected early in the third quarter. Kosmos' share of the costs incurred to date on drilling the Anapai well is approximately $20 million.

  • In Block 42 the partnership is finalizing the first of up to three independent tests of prospects in the block. This includes the Pontoenoe prospect, which is similar to and along trend from the discoveries in Guyana. Kosmos anticipates drilling starting in the third quarter of this year.
06:07  EDIT Editas Medicine reports new data for EDIT-101 demonstrating tolerance in non-human primates (34.85 )

  • Co announced results from a pre-clinical study demonstrating that EDIT-101 was well-tolerated when administered to non-human primates (NHP) via subretinal injection. EDIT-101 is the Company's experimental medicine for the treatment of Leber Congenital Amaurosis type 10
  • Both EDIT-101 and VIR-067 were well tolerated in animals treated with prophylactic steroids. Delayed, mild inflammation was observed infrequently in animals that were not treated with prophylactic steroids. There was no delayed inflammation observed in EDIT-101 treated eyes after discontinuation of prophylactic steroids. Comparable intraocular pressures were reported between vehicle- and EDIT-101- or VIR-067-treated eyes throughout the study. Additionally, low levels of pre-existing or induced immunity to Staphylococcus aureus Cas9 (SaCas9) did not correlate with ocular inflammation, whereas the anti-AAV5 capsid immune response in non-immunosuppressed animals may contribute to delayed ocular inflammation. Nevertheless, neither SaCas9- nor AAV5-specific immunity impacted the pharmacological activities of the study drug.
06:06  RHHBY Roche Hldg announces full results from the phase III HAVEN 3 study evaluating Hemlibra prophylaxis (27.93 )

The co announced full results from the phase III HAVEN 3 study evaluating Hemlibra (emicizumab) prophylaxis administered every week or every two weeks in people with haemophilia A without factor VIII inhibitors and the phase III HAVEN 4 study evaluating Hemlibra prophylaxis administered every four weeks in people with haemophilia A with or without factor VIII inhibitors.

  • In the phase III HAVEN 3 study, adults and adolescents aged 12 years or older without factor VIII inhibitors who received Hemlibra prophylaxis every week or every two weeks showed a 96% (p<0.0001) and 97% (p<0.0001) reduction in treated bleeds, respectively, compared to those who received no prophylaxis. In addition, 55.6% (95% CI: 38.1; 72.1) of people treated with Hemlibra every week and 60% (95% CI: 42.1; 76.1) of people treated with Hemlibra every two weeks experienced zero treated bleeds, compared to 0% (95% CI: 0.0; 18.5) of people treated with no prophylaxis. Importantly, in an intra-patient comparison, in patients who were previously enrolled in a prospective non-interventional study (NIS), once-weekly Hemlibra prophylaxis showed superior efficacy compared to prior factor VIII prophylaxis, the standard of care for people with haemophilia A without factor VIII inhibitors, as demonstrated by a 68% reduction (p<0.0001) in treated bleeds.
  • Additionally, 93.7% (n=89/95; 95% CI, 86.8; 97.7) of all participants who completed a treatment preference survey preferred Hemlibra to their previous haemophilia treatment, with 97.8% (n=45/46) of those in the intra-patient comparison preferring Hemlibra to their prior factor VIII prophylaxis.
  • There were no unexpected or serious adverse events (AEs) related to Hemlibra, and the most common AEs were consistent with previous studies. The most common AEs occurring in 5% or more of people in the HAVEN 3 study were injection site reactions, joint pain (arthralgia), common cold symptoms (nasopharyngitis), headache, upper respiratory tract infection and influenza.
06:05  KLXI KLX beats by $0.06, beats on revs (73.09 )

  • Reports Q1 (Apr) earnings of $1.12 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus of $1.06; revenues rose 21.3% year/year to $499.1 mln vs the $479.5 mln single analyst estimate.
  • As a result of the pending sale of the Aerospace Solutions Group to Boeing (BA), the Company will no longer be providing ASG segment level guidance. FY18 Guidance (no comparable ests): 2018 revenues are expected to increase by approximately 55 percent to approximately $500 million Adjusted operating earnings are expected to increase approximately $84 million to approximately $65 million Adjusted EBITDA is expected to increase approximately 300 percent to approximately $110 million, or 22 percent of revenues The Company expects continued strong organic growth in revenues and earnings in 2019.
06:03  MIDD Middleby to acquire Taylor Company for $1.0 bln (104.45 )

  • The Middleby Corporation announced that it has entered into a definitive agreement to acquire the Taylor Company from UTC Climate, Controls & Security, a unit of United Technologies (UTX) for $1.0 billion. Taylor is a world leader in beverage solutions, soft serve and ice cream dispensing equipment, frozen drink machines, and automated double-sided grills. Middleby will finance the all-cash acquisition under its existing revolving credit facility. In 2017, Taylor had revenues of approximately $315 million and $65 million of adjusted earnings before interest, taxes and depreciation.
  • The transaction has been structured to provide Middleby with a tax step-up with a net present value of approximately $150 million.
  • The transaction completion is subject to customary closing conditions, including regulatory approvals, with an expected closing early in the third quarter of 2018.
06:01  INFO IHS Markit to acquire Ipreo, a financial services solutions and data provider, for $1.855 billion (51.43 )

The acquisition is expected to close in the second half of 2018, subject to customary closing conditions and regulatory filings and approvals, including with the UK Financial Conduct Authority and under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976.
06:01  CHU China Unicom reports April mobile billing subs of 297.1 mln, net additional of 3.071 mln (14.34 )

 
06:00  NVO Novo Nordisk A/S: Head-to-head trial shows Refixia achieves greater total factor IX exposure in people with haemophilia B than recombinant factor IX-Fc fusion protein (48.72 )

  • Adults with haemophilia B who received a single dose Refixia achieved greater total factor IX exposure than those treated with rFIXFc. The head-to-head paradigm trial also observed a longer half-life for Refixia. These pharmacokinetic findings were presented today at the WFH 2018 World Congress in Glasgow, UK.1
  • The trial showed that the total factor IX exposure of Refixia in patient plasma after injection of a single dose (50 IU/kg) was 4.39-fold greater than for rFIXFc, as measured by the area under the curve. Seven days after injection, the factor IX activity in patients treated with a single dose of Refixia was six-fold greater than that of patients treated with rFIXFc at the same dose.
06:00  GSK GlaxoSmithKline: Nucala (mepolizumab) study reports long-term safety data, consistent exacerbation reduction and improved asthma control (40.03 )

  • Co presented new data from the longest study of an anti-IL5 biologic treatment in severe eosinophilic asthma to be reported. The study showed consistent reductions in exacerbations and improvements in asthma control, with a safety profile similar to previous clinical studies, in severe eosinophilic asthma patients treated with Nucala (mepolizumab) over the long-term study period. One third of patients in the study treated with mepolizumab experienced no exacerbations, despite entering the study with an average of almost two exacerbations (1.74) per year.
    • Results showed:
    • 61% decrease in exacerbation rate (from 1.74 events/year at enrolment to 0.68 events/year during the treatment period; 95% confidence interval 0.60, 0.78)
    • Consistent exacerbation rates per year over the study period (year one, 0.71, year two, 0.82, year three, 0.71)
06:00  AZN AstraZeneca: Lokelma approved in the US for the treatment of adults with hyperkalaemia (36.33 )

  • The US Food and Drug Administration has approved Lokelma (sodium zirconium cyclosilicate), formerly ZS-9, for the treatment of adults with hyperkalaemia, a serious condition characterised by elevated potassium levels in the blood associated with cardiovascular, renal and metabolic diseases.
  • Co also has submitted a supplemental new drug application (sNDA) to Japan's Pharmaceuticals and Medical Devices Agency (PMDA) for the use of Forxiga (dapagliflozin), a selective sodium-glucose co-transporter 2 (SGLT2) inhibitor, as an oral adjunct treatment to insulin in adults with type-1 diabetes (T1D).
16:55  WRAPX This week's biggest % gainers/losers

The following are this week's top percentage gainers and top percentage losers, categorized by sectors (over $300 mln market cap and 100K average daily volume).

This week's top % gainers
  • Healthcare: NERV (7.95 +22.31%), LOXO (170.44 +22.22%), FOLD (16.74 +19.49%), ABAX (83.32 +17.6%), ATRA (50.05 +17.08%)
  • Industrials: ESND (13.72 +35.98%), CSTE (15.15 +17.9%)
  • Consumer Discretionary: ASNA (3.2 +29.03%), EROS (13.35 +17.11%)
  • Information Technology: VNET (6.7 +31.37%)
  • Energy: SE (13.07 +24.24%), CLNE (2.42 +23.47%), REGI (16.95 +23.27%), CHK (4.06 +20.83%), CVRR (21.9 +17.11%)
This week's top % losers
  • Healthcare: SGYP (1.64 -13.23%), OPK (3.99 -11.73%)
  • Industrials: GOL (7.61 -13.33%)
  • Consumer Discretionary: VIPS (12.05 -20.25%), ARCO (7.05 -13.5%), JACK (80.72 -10.83%)
  • Information Technology: KEM (17.86 -13.47%), ITRI (58.35 -11.92%)
  • Energy: TNP (3.47 -10.8%)
  • Consumer Staples: CPB (34.37 -15.51%), FLO (19.29 -14.76%), BRFS (5.83 -13.37%)
  • Utilities: SBS (7.06 -12.08%), JE (3.6 -11.33%)
16:33  SCANX Market Internals -Technical-

DOW closes up at 24716 ( 0.01%). Nasdaq closes down to 7354 ( -0.38%). S&P500 closes down to 2713.01 ( -0.26%). Action came on lower than average volume (NYSE 872 mln vs avg. of 804 mln; Nasdaq 1933 mln vs avg. of 2039 mln) , w/ mixed advancers decliners (NYSE 1487/1399, NASDAQ 1390/1409) and new highs outpacing new lows (NYSE 112/70, NASDAQ 149/41) .

Relative Strength:

Cocoa-NIB +1.68%, U.S. Home Construction -ITB +1.4%, Short Term Futures-VXX +1.32%, DB Agriculture-DBA +1.21%, Teucrium Corn-CORN +1.17%, Israel-EIS +0.93%, South Korea -EWY +0.46%, Chinese Yuan-CYB +0.36%, Austrialian Dollar-FXA +0.22%, China Large Cap-FXI +0.16%

Relative Weakness:

South Africa-EZA -2.76%, Indonesia-IDX -2.55%, Greece 20-GREK -1.88%, Latin America 40 -ILF -1.79%, Mexico-EWW -1.73%, Steel -SLX -1.49%, Semiconductors-SMH -1.2%, S&P Retail -XRT -0.96%, Global X Lithium -LIT -0.95%, U.S. Financial Services-IYG -0.92%

16:32  MDXG MiMedx Group received written notification, as expected, from the NASDAQ that the Company continues to be in noncompliance with the NASDAQ Listing Rules since MiMedx has not yet filed its Form 10-Q for the period ended March 31, 2018 (7.40 +0.08)

The Company has submitted in a timely manner to NASDAQ a plan to regain compliance, and NASDAQ has informed MiMedx that it can grant an exception for MiMedx to remain listed for up to 180 calendar days from the Form 10-K's due date, or until August 28, 2018, if the plan is accepted.
16:25  WRAPX Closing Market Summary: Wall Street Slips On Friday, Locks In Weekly Losses

Stocks were range-bound on Friday, drifting near their flat lines from open to close. The S&P 500 and the Nasdaq ended with losses of 0.3% and 0.4%, respectively, while the Dow eked out a very slim victory, adding less than 0.1%. Small caps showed relative strength once again, pushing the Russell 2000 up 0.1% and to its third consecutive record close.

Friday's outing left the S&P 500, the Nasdaq, and the Dow with weekly losses of around 0.5% apiece. The Russell 2000 finished the week up 1.2%.

There were several notable post-earnings movers on Friday, mostly to the downside. Shares of Nordstrom (JWN 45.36, -5.55) slid 10.9% after the high-end retailer missed quarterly estimates for same-store sales, and Applied Materials (AMAT 49.51, -4.45) shares dropped 8.3% after the company, which supplies tools used by chipmakers, cut its revenue guidance. Shares of Campbell Soup (CPB 34.37, -4.85) also took a beating, tumbling 12.4%, after the company slashed its earnings guidance, announced the immediate retirement of its CEO, and said it'll be launching a months-long strategic review.

However, on the upside, Deere (DE 155.25, +8.44) shares rallied 5.8% after the company's upbeat revenue guidance overshadowed an earnings miss. The industrial sector, which houses Deere, finished at the top of Friday's sector standings with a gain of 0.6%. The health care and materials groups also showed relative strength, adding 0.3% and 0.1%, respectively.

Within the health care space, Amgen (AMGN 176.30, +1.65) shares rallied 0.9% after the company won FDA approval for the first drug designed to prevent migraines.

The financials and energy sectors were the worst-performing groups, losing 0.9% and 0.8%, respectively. Financials slid in tandem with Treasury yields, which retreated from multi-year highs. The benchmark 10-yr yield slid four basis points to 3.07%. Similarly, energy struggled as crude futures ticked down from a three-and-a-half year high. WTI crude futures slipped 0.3% to $71.25/bbl.

In U.S.-China trade news, Beijing denied Thursday reports that it has offered to slash its trade surplus with the U.S. by up to $200 billion. On a related note, shares of Dutch semiconductor company NXP (NXPI 111.02, +4.31) jumped 4.0% after a Chinese official said approval of the company's proposed merger with U.S. chipmaker Qualcomm (QCOM 57.51, +0.56) is looking "more optimistic." The deal has been approved by eight of the nine required global regulators, with Chinese approval still pending.

Across the pond, two anti-establishment parties in Italy, the 5 Star Movement and the League, have agreed on a governing platform and are expected to nominate a prime minister in time for Monday's meeting with Italian President Sergio Mattarella. Italy's MIB lost 1.5% on Friday while other major European indices finished just a tick lower.

Investors did not receive any notable economic data on Friday.

  • Nasdaq Composite +6.5% YTD
  • Russell 2000 +5.9% YTD
  • S&P 500 +1.5% YTD
  • Dow Jones Industrial Average UNCH YTD

Week In Review: Stocks Stumble As Yields Rise

The stock market stumbled this week, giving back about a quarter of last week's advance, with the S&P 500, the Nasdaq, and the Dow losing between 0.5% and 0.7%. However, shares of smaller, domestically-focused companies outperformed, sending the Russell 2000 higher by 1.2%. The Russell 2000 closed at a new record high in each of the last three sessions of the week.

Beijing sent a delegation to Washington this week for a second round of trade talks after the first round failed to move the needle earlier this month. There was some optimism ahead of this week's negotiations after President Trump announced over the weekend that he's working to get Chinese phone company ZTE, which is suffering due to U.S. sanctions, "back into business." However, the optimism faded after the president acknowledged on Thursday that he's doubtful a deal can be reached.

In other international developments, Italy's major stock index tumbled 2.9% this week and its 10-yr yield shot higher by 35 basis points as two anti-establishment parties, the 5 Star Movement and the League, neared forming a governing coalition that will almost certainly clash with the European Union. Separately, U.S. officials said the U.S., Canada, and Mexico are still nowhere near a deal on NAFTA.

On Wall Street, Treasury yields were in focus after they spiked to multi-year highs on Tuesday. The yield on the benchmark 10-yr Treasury note hit 3.11%, its highest level since July 2011, before slipping to 3.07% on Friday. Still, that represents a gain of 10 basis points for the week. The rise in "risk free" returns lured some buyers away from the equity market, putting Wall Street's May rally on hold.

Tuesday's spike in Treasury yields coincided with the release of the Retail Sales report for April, even though the report came in as expected, showing a month-over-month increase of 0.3%.

On a related note, retailers dominated the earnings front this week, with Walmart (WMT), Home Depot (HD), Macy's (M), Nordstrom (JWN), and J.C. Penney (JCP) reporting their quarterly results. All five companies beat earnings estimates, but Walmart, Home Depot, Nordstrom, and J.C. Penney fell short on same-store sales, sending their shares lower. Shares of Macy's, conversely, soared after the company beat same-store sales estimates and raised its guidance for the fiscal year.

Apart from earnings, shares of CBS (CBS) dropped sharply on Thursday after a judge ruled against the company in its attempt to dilute its controlling shareholder, Shari Redstone, who is attempting to force a CBS-Viacom (VIAB) merger. The Redstone family controls both CBS and Viacom through its holding company, National Amusements.

As for the sector standings, decliners outnumbered advancers seven to four this week. The rate-sensitive utilities (-3.2%) and real estate (-3.2%) sectors were the worst-performing groups, largely due to the rise in Treasury yields. The heavily-weighted technology (-1.5%) and financials (-1.1%) spaces also struggled. On the upside, the energy (+1.5%) and materials (+1.6%) sectors were the top performers.

Following this week's decline, the S&P 500 and the Nasdaq are up 1.5% and 6.5% for the year, respectively, and the Dow is now flat.

16:05  RCKT Rocket Pharmaceuticals reports continued clinical evidence demonstrates RP-L102 can restore bone marrow function of fanconi anemia patients without conditioning (19.90 -0.03)

Co announced the presentation of updated data from the ongoing Phase 1/2 clinical trial of RP-L102, the Company's lead lentiviral vector (LVV)-based gene therapy, for Fanconi Anemia (FA).

  • Continued Clinical Evidence Demonstrates RP-L102 Can Restore Bone Marrow Function of Fanconi Anemia Patients Without Conditioning 
  • Increases in Gene-Corrected Leukocytes Demonstrate Bone Marrow Rescue Leading to Hematologic Stabilization
  • All Four Patients Followed for Six Months or Longer Demonstrate Mixed Chimerism; Two Patients with Higher Product Doses Exhibit Sustained Mosaic Phenotype 
  • First Patient Treated with Transduction-Enhanced RP-L102 Shows Highest Transduction Efficiency and Earliest Engraftment to Date
16:04  PSEC Prospect Capital issues $103.5 mln of senior unsecured 4.95% Convertible Notes Due 2022 (6.69 )

Prospect expects to use a portion of the net proceeds from the sale of the Notes to repay debt under our credit facility. Prospect intends to use the remainder of the net proceeds of the offering to invest in high quality short term debt investments, and/or make long term investments in accordance with its investment objective.