Welcome to the recovery: Euro zone warning hits stocks, currency as oil plumbs depths (Reuters) Japan GDP Worse Than Initially Reported (WSJ) China trade data well below expectations (BBC) German industrial production frustrates forecasts (FT) Oil Extends Retreat With European Stocks as Dollar Gains (BBG) California police, protesters clash again after 'chokehold' death (Reuters) Ruble’s Rout Is Tale of Failed Threats, Missteps (BBG), not to be confused with "Yen's Rout Is Tale Of Keynesian Success, Prosperity" Uber banned from operating in Indian capital after driver rape (Reuters) U.S. sanctions aimed at changing power, Russian envoy says (Reuters) RadioShack Again Denies Defaulting On Loan (WSJ), still waiting for LBO Philippine capital braces for storm, as Hagupit leaves 27 dead (Reuters) Russian Ties Complicate U.S. Sanctions (WSJ) Despite failures, U.S. likely to continue raids to free hostages (Reuters) ECB Loans Seen as Underwhelming in Acid Test for Draghi (BBG) One Hundred Years of Bond History Means Bears Destined to Lose (BBG) Grumpy Cat earns more than Gwyneth Paltrow (SMH)
Overnight Media Digest
WSJ
* Many of the world's top policy makers are rewriting their economic forecasts for the United States, Europe, Japan and elsewhere, betting plummeting oil prices will lead to an overall boost in the global economy. (http://on.wsj.com/1InnAwN)
* Banks are urging some of their largest customers in the United States to take their cash elsewhere or be slapped with fees, citing new regulations that make it onerous for them to hold certain deposit. The banks, including J.P. Morgan Chase & Co, Citigroup Inc, HSBC Holdings Plc, Deutsche Bank AG and Bank of America Corp, have spoken privately with clients in recent months to tell them that the new regulations are making some deposits less profitable. (http://on.wsj.com/1wQbTeC)
* U.S. companies trying to avoid running afoul of the recent sanctions against Russia say they face a monumental challenge - figuring out which companies are owned by those blacklisted. (http://on.wsj.com/1A7hjzo)
* Workers at U.S. assembly plants for General Motors Co and Ford Motor Co are likely to get 2014 bonuses exceeding $6,000 each, capping a four-year labor contract under which profit-sharing checks have gone to factory employees in record amounts. But the United Auto Workers union, gearing up for negotiations with Detroit's Big Three next summer, is prepared to argue that is not good enough. (http://on.wsj.com/12ClbNC)
* Indonesian President Joko Widodo, the new leader of the world's fourth-largest nation, promised to move aggressively to lower barriers to investment and overcome decades of unmet potential that have left the country lagging behind more dynamic Asian nations. (http://on.wsj.com/1u7fRcB)
* Temasek Holdings, Singapore's state investment firm, agreed to buy 10 percent of high-frequency trading firm Virtu Financial LLC for about $200 million, according to people familiar with the matter. (http://on.wsj.com/1wmgrcX)
* Blackstone Group LP has agreed to sell its northern California portfolio of 26 office buildings for $3.5 billion to a Los Angeles-based real-estate investment trust, Hudson Pacific Properties Inc, its largest office sale in seven years. (http://on.wsj.com/1zDE79Y)
* Sugar is getting dearer in the United States even as it is getting cheaper in most other places, putting pressure on candy manufacturers to raise prices. (http://on.wsj.com/1qhbYWl)
* Google Inc's YouTube unit is racing to lock up its top stars as rival online video services court them aggressively. Facebook Inc and video startup Vessel, among others, have tried to lure YouTube creators to their services in recent months, according to people familiar with the discussions. (http://on.wsj.com/1zDnprn)
* Music service Grooveshark has spent years embroiled in legal battles with record labels because the company didn't obtain licenses for the music it offered free to its millions of users. Now the eight-year-old company is trying a fresh approach: playing by the rules. Launching what a company spokesman calls its "first compliant app," Grooveshark plans to roll out a digital radio service in January that will cost 99 cents a month and run without commercials. (http://on.wsj.com/1yZ3wM1)
* The North Dakota Industrial Commission will meet on Tuesday to complete steps it proposed last month that would require oil companies as of Feb. 1 next year to start removing volatile gaseous compounds before shipping their crude on railroads crisscrossing the country. (http://on.wsj.com/1s3aXSN)
FT
* Merck & Co Inc is in talks to acquire Cubist Pharmaceuticals Inc in a $8 billion deal which values Cubist at $102 a share and could come early this week.
* The UK's Financial Conduct Authority is to review its fining regime as banks complain over rise of penalties which have hit record levels after investigations into alleged rigging of London interbank offered rate and the foreign exchange market.
* Credit Suisse AG is considering scaling down its prime brokerage business as part of already announced efforts to reduce risk in its investment banking division.
* BP is quickening the pace of plans to reduce headcount as it grapples with the plummeting oil price. The company is looking at its non-operations staff that have been kept on as the company has shed production assets in its portfolio.
NYT
* The National Association for the Advancement of Colored People (NAACP), the National Urban League and the Rainbow/PUSH Coalition sent representatives to tell Tom Wheeler, chairman of the Federal Communications Commission, that they thought U.S. President Barack Obama's call to regulate broadband Internet service as a utility would harm minority communities by stifling investment in underserved areas and entrenching already dominant Internet companies. (http://nyti.ms/1CXD3mX)
* A woman was raped late Friday by a driver for Uber, the hail-a-ride service, who diverted from the intended route and switched off his cellphone so that he was untraceable during the ride, police officials in New Delhi said. (http://nyti.ms/1vuybvF)
* Sam Oh, a partner at Apollo Global Management who worked on deals in the energy sector, is leaving the private equity firm, two people briefed on the matter said on Friday. (http://nyti.ms/1yu9EsV)
* Hong Kong's IPO market for large new stock offerings is showing signs of a December rebound after what has been a difficult year. (http://nyti.ms/1G6iCm1)
* Merck & Company, the big drug maker, is in talks to acquire the biopharmaceutical company Cubist Pharmaceuticals Inc for more than $7 billion, according to people briefed on the matter. (http://nyti.ms/127rxEX)
Canada
THE GLOBE AND MAIL
** A self-imposed deadline to sell off more than C$2 billion ($1.75 billion) in government assets is forcing a tough decision on the Conservative Tory government: sell when prices are low or hold the assets and put a return to balanced budgets at risk. Federal revenues are already expected to take a significant hit due to the recent slide in oil prices, which has forced the government to shrink its projections for next year's surplus down to C$1.6 billion. But other market factors are adding stress to the government's fiscal plans. (http://bit.ly/1w5np2I)
** One out of every four inmates who cycled through federal penitentiaries last year spent some time in solitary confinement, an extreme form of incarceration that is undermining efforts to rehabilitate offenders, Canada's prison watchdog Howard Sapers said in an interview on Sunday. (http://bit.ly/12hayjs)
** Green bonds - which raise money for projects that help mitigate climate change - have grown from a niche market to a substantial portion of the fixed income market, a new report says. And Canada is emerging as a significant player in that market, thanks to three large green bond issues in 2014. (http://bit.ly/1yZoOsX)
NATIONAL POST
** Wind turbines generally have little effect on the value of nearby properties with possibly isolated exceptions, a recent study of thousands of home and farm sales has found. The surprising findings, published in the Canadian Journal of Agricultural Economics, come amid an already fiery debate over wind farm impacts and appear to contradict widely-held views among turbine critics. (http://bit.ly/1yuXCPS)
** Former Canadian Forces general Andrew Leslie will carry the Liberal banner in Orleans in next year's federal election, but his nomination on Saturday was marred by a chaotic and divisive scene in which police had to break up a noisy scuffle. (http://bit.ly/12DoMuT)
** Enbridge Inc is planning significantly greater aboriginal participation and control - perhaps even a majority - over the Northern Gateway oil pipeline, while eventually stepping back into more of an operator role, the proposed pipeline's top executive confirmed on Friday. (http://bit.ly/1sbEzba)
China
SOUTH CHINA MORNING POST
- The insurance industry is set to launch new products targeting senior citizens, a direction one firm says may reduce the government's burden of rising long-term health care costs. Reinsurance company Swiss Re will accept applications from people aged up to 75, a departure from policies that prevent people older than 60 or 65 from entering into insurance agreements. (http://bit.ly/1u9qVVG)
- Hong Kong Chief Executive Leung Chun-ying warned that "furious resistance" is expected from some protesters in the Admiralty Occupy camp when police help bailiffs execute a court order to clear part of the protest site, which could take place as early as on Wednesday. (http://bit.ly/1yCEUd4)
- The Shenzhen hub of Qianhai opened a 58,000 square metre area designated for young entrepreneurs from Hong Kong and elsewhere to start their businesses, but at least two Hongkongers who visited the site expressed concern about policy implementation and fierce competition. (http://bit.ly/1u5WpwY)
THE STANDARD
- Around one percent of green belts will be transformed into residential sites to boost Hong Kong's tight home supply, development secretary Paul Chan Mo-po said. In the short-to-medium term, 70 plots of greenery, covering a total of 150 hectares, will be re-zoned for residential use, Chan wrote online. (http://bit.ly/12Uci3c)
- No more students will join the two Scholarism members fasting since Thursday, according to the group's convener, Joshua Wong Chi-fung, who is recovering after quitting his own 108-hour hunger strike. (http://bit.ly/1w3GIuy)
HONG KONG ECONOMIC TIMES
- Hong Kong developer Far East Consortium International Ltd forecast property prices for small- to medium-size residential flats in the territory to rise 5 to 8 percent in 2015, while luxury projects can rise up to 5 percent, according to senior sales and marketing director Fong Chun.
MING PAO DAILY
- Property developer Modern Land (China) Co Ltd expects sales of apartments to touch 7 billion yuan ($1.14 billion) this year, up from 4.4 billion yuan in the previous year, and the company aims to enlarge its land bank in first- and second-tier Chinese cities in the next two years, according to president Zhang Peng.
Britain
The Times
'NO' MAY NOT BE FINAL WORD AS JLIF TAKES ISSUE WITH BALFOUR
Balfour Beatty Plc's year worsened last night after it emerged that the findings of an internal investigation will not be known until the new year and that a rebuffed bidder for a large chunk of the group was not taking "no" for an answer. (http://thetim.es/1wk3RLd)
"TREASURY OFFICIAL" SHARON WHITE IN FRAME TO RUN OFCOM
Sharon White, the first woman to be appointed to the role of second permanent secretary at the Treasury last year, has been recommended to replace Ed Richards, the outgoing Ofcom chief executive. (http://thetim.es/1yYHSYa)
The Guardian
CITY'S STATUS AS STOLEN-MONEY HAVEN A STAIN ON UK, SAYS EX-REGULATOR MP
The city of London's status as a favourite place for the world's dishonest officials to hide stolen money will remain a stain on the UK's reputation, despite a long-awaited government anti-corruption plan, according to a former regulator who is now an MP. (http://bit.ly/1zeqmAe)
MARKS AND SPENCER CUSTOMERS HIT BY DELAYS TO ONLINE SHOPPING ORDERS
Marks and Spencer Group Plc's new delivery centre is part of a 1 billion pounds ($1.56 billion) programme to improve ageing IT and distribution systems in order to ensure it has the right items in stores and is able to handle increasing demand for home deliveries. (http://bit.ly/1ys91ov)
The Telegraph
PREMIER FOODS BACKTRACKS ON SUPPLIER DEMANDS BUT REFUSES TO APOLOGISE
Premier Foods will still seek financial contributions from suppliers despite backtracking on its controversial "pay to stay" scheme after fierce criticism from politicians. Gavin Darby, chief executive of Premier, said the company will drop its request for investment from suppliers but will instead seek a discount on the prices it pays for goods. (http://bit.ly/1ys4YIX)
SOUTH AFRICAN BILLIONAIRE PLANS TO LAUNCH MAJOR NEW FASHION RETAILER IN THE UK
The South African billionaire Christo Wiese is planning an assault on the UK retail market and has built a collection of heavyweight figures from the industry to lead his plans. A new company called Pepkor UK Retail Limited, named after Wiese's holding group, has been registered at Companies House. (http://bit.ly/1wPC0lF)
Sky News
WONGA BRACES FOR FCA CAP WITH LOWER-COST LOAN
Britain's biggest payday lender has begun secret trials of lower-cost loans just weeks before a deadline set by the City regulator to comply with a new crackdown on the industry. Wonga has in the last fortnight started offering finance to a number of randomly selected customers who are offered substantially better terms than other borrowers. (http://bit.ly/1s2sBpH)
NIGEL WICKS TO STEP DOWN AS CHAIRMAN OF BANK BODY
Nigel Wicks is to step down as chairman of the British Bankers' Association (BBA) following a three-year term in which it surrendered oversight of interbank borrowing rates following the Libor rate-rigging scandal. (http://bit.ly/1wPCXug)
Fly On The Wall Pre-Market Buzz
ECONOMIC REPORTS
No major domestic economic reports scheduled for today.
ANALYST RESEARCH
Upgrades
Antero Resources (AR) upgraded to Buy from Neutral at Citigroup
Apache (APA) upgraded to Buy from Neutral at Citigroup
Applied Materials (AMAT) upgraded to Buy from Hold at Deutsche Bank
EastGroup Properties (EGP) upgraded to Neutral from Underperform at Credit Suisse
eBay (EBAY) upgraded to Buy from Hold at Stifel
GasLog (GLOG) upgraded to Buy from Hold at Stifel
Hoegh LNG (HMLP) upgraded to Buy from Neutral at UBS
LaSalle Hotel (LHO) upgraded to Overweight from Equal Weight at Morgan Stanley
Lufthansa (DLAKY) upgraded to Buy from Neutral at Nomura
NASDAQ (NDAQ) upgraded to Outperform from Market Perform at Keefe Bruyette
Newfield Exploration (NFX) upgraded to Buy from Neutral at Citigroup
Omega Healthcare (OHI) upgraded to Buy from Hold at Jefferies
Orange SA (ORAN) upgraded to Conviction Buy from Neutral at Goldman
Southwest (LUV) upgraded to Buy from Neutral at Goldman
TSMC (TSM) upgraded to Buy from Neutral at BofA/Merrill
United Technologies (UTX) upgraded to Outperform from Market Perform at Bernstein
Downgrades
CME Group (CME) downgraded to Market Perform from Outperform at Keefe Bruyette
Canadian Natural (CNQ) downgraded to Neutral from Buy at Citigroup
Canadian Pacific (CP) downgraded to Neutral from Buy at Goldman
Clean Energy (CLNE) downgraded to Hold from Buy at Ascendiant
Cobalt (CIE) downgraded to Neutral from Buy at Citigroup
Deutsche Bank (DB) downgraded to Underperform from Market Perform at Keefe Bruyette
HSBC (HSBC) downgraded to Market Perform from Outperform at Keefe Bruyette
Iliad (ILIAF) downgraded to Buy from Conviction Buy at Goldman
K+S (KPLUF) downgraded to Sell from Neutral at Goldman
LeapFrog (LF) downgraded to Neutral from Buy at Roth Capital
Nike (NKE) downgraded to Market Perform from Outperform at Telsey Advisory
Planar Systems (PLNR) downgraded to Neutral from Buy at B. Riley
Red Hat (RHT) downgraded to Market Perform from Outperform at Wells Fargo
Sabra Health Care (SBRA) downgraded to Hold from Buy at Jefferies
U.S. Bancorp (USB) downgraded to Underperform from Market Perform at Keefe Bruyette
Initiations
21st Century Fox (FOXA) initiated with a Buy at UBS
ADMA Biologics (ADMA) initiated with an Outperform at Oppenheimer
AMC Networks (AMCX) initiated with a Neutral at UBS
Burger King (BKW) coverage resumed with a Buy at Goldman
CBS (CBS) initiated with a Neutral at UBS
Chipotle (CMG) coverage resumed with a Buy at Goldman
Discovery (DISCA) initiated with a Neutral at UBS
Disney (DIS) initiated with a Buy at UBS
Dominion (D) initiated with a Market Perform at Wells Fargo
Domino's Pizza (DPZ) coverage resumed with a Neutral at Goldman
Dunkin' Brands (DNKN) coverage resumed with a Neutral at Goldman
FormFactor (FORM) initiated with a Buy at Needham
KLA-Tencor (KLAC) initiated with a Hold at Deutsche Bank
McDonald's (MCD) coverage resumed with a Neutral at Goldman
Medgenics (MDGN) initiated with an Overweight at Piper Jaffray
Netflix (NFLX) initiated with a Neutral at UBS
PRA Health (PRAH) initiated with a Buy at Jefferies
PRA Health (PRAH) initiated with a Buy at UBS
PRA Health (PRAH) initiated with a Neutral at Citigroup
PRA Health (PRAH) initiated with an Outperform at Credit Suisse
PRA Health (PRAH) initiated with an Outperform at RW Baird
Panera Bread (PNRA) coverage resumed with a Sell at Goldman
Potbelly (PBPB) coverage resumed with a Neutral at Goldman
Scripps Networks (SNI) initiated with a Neutral at UBS
Star Bulk Carriers (SBLK) initiated with a Hold at Deutsche Bank
Starbucks (SBUX) coverage resumed with a Conviction Buy at Goldman
Time Warner (TWX) initiated with a Buy at UBS
Viacom (VIAB) initiated with a Neutral at UBS
Yum! Brands (YUM) coverage resumed with a Sell at Goldman
COMPANY NEWS
Merck (MRK) to acquire Cubist (CBST) for $102 per share in cash
CBS (CBS), DISH (DISH) reached a multi-year agreement for carriage of CBS owned stations across the country, as well as CBS Sports Network, Smithsonian Channel, TVGN and Showtime Networks
Morningstar (MORN) raised quarterly dividend to 19c from 17c per share
SIFCO Industries (SIF) appointed James Woidke president and COO
Advisory Committee recommended approval of Actavis' (ACT) ceftazidime-avibactam, an investigational antibiotic being developed to treat hospitalized patients when limited or no treatment options are available for complicated intra-abdominal infections and complicated urinary tract infections caused by Gram-negative pathogens
BHP Billiton (BHP) announced that the new company it intends to create through its proposed demerger will be called South32
EARNINGS
Companies that matched consensus earnings expectations include:
Liberty Tax reports Q2 adjusted EPS (74c)
Globus Maritime (GLBS) reports Q3 EPS 2c, one estimate 14c
NEWSPAPERS/WEBSITES
North Korea denies role in recent Sony (SNE) hacking, WSJ reports
Twitter's (TWTR) former head of product leaving company, Re/code reports
Credit Suisse (CS) assesses prime brokerage business, Reuters reports
Apple (AAPL) rumored to be launching 4-inch iPhone in 2015, Times of India reports
Google (GOOG) could reach $634 in a year, Barron's says
Gap (GPS) shares look cheap, should continue to rise, Barron's reports
HP (HPQ) shares could gain 15%, Barron's says
SYNDICATE
Ascent Solar (ASTI) files to sell 4M shares for holders
Blue Earth (BBLU)files to sell 10.11M shares for holders
TransAlta (TAC) files $2B mixed securities shelf
Ventas (VTR) files to sell 148,241 shares for holders
