- Scotland split jitters send sterling to 10-month low (Reuters)
- S&P 500 Beating World Most Since 1969 Doesn’t Spark Flows (BBG)
- Happy ending guaranteed: Vietnam building deterrent against China in disputed seas with submarines (Reuters)
- China Posts Record Surplus as Exports-Imports Diverge (Bloomberg)
- Russia, U.S. to hold talks on 1987 arms accord (Reuters)
- Halcon’s Wilson Drills More Debt Than Oil in Shale Bet (BBG)
- Deadly Disappointment Awaits at Ebola Clinics Due to Lack of Space (WSJ)
- Latinos furious at Obama on immigration delay, vow more pressure (Reuters)
- Japan GDP Shrinks at Fastest Pace in More Than Five Years (WSJ)
- U.S. air strikes target insurgents near Iraq's Haditha Dam (Reuters)
- SEC Preps Mutual Fund Rules (WSJ)
- China's Use of Antimonopoly Law May Violate Its WTO Commitments (WSJ)
- U.K.’s Big Banks Cut Lending by $595 Billion, KPMG Says (BBG)
- Should Venezuela Default? (ProSyn)
- Zoolander Was Wrong: Why Phones Are Getting Bigger, Not Smaller (BBG)
- Former New Orleans Mayor to start jail sentence for graft (Reuters)
Overnight Media Digest
WSJ
* President Barack Obama will lay out plans this week for expanding the U.S. military campaign against the extremist group Islamic State, including the possibility of airstrikes on the militants in their Syrian strongholds, U.S. officials said. (http://on.wsj.com/1lQa9NW)
* Can the U.S. compete internationally? Its companies can. Its workers cannot. That is the key finding from a new survey of Harvard Business School alumni that delves into their views of the U.S. business environment to see where the nation thrives and where it falters. (http://on.wsj.com/1rs8jiE)
* In recent years, Americans have been spared the sticker shock of paying full price for a new iPhone because wireless operators offered upfront discounts approaching $500 a phone. But Apple Inc faces an uncertain new environment this week as it prepares to unveil new- and what are expected to be more expensive-iPhones. Carriers have been weaning consumers off subsidies and getting them to pay full price for new devices. (http://on.wsj.com/1quAMrS)
* The Securities and Exchange Commission is preparing new rules to boost oversight of mutual funds, hedge funds and other firms as part of an effort to gain insight into whether the $50 trillion asset-management industry poses risks to the financial system, according to people familiar with the discussions. (http://on.wsj.com/1qyKj13)
* A fast-growing Virginia laboratory has collected hundreds of millions of dollars from Medicare while using a strategy that is now under regulatory scrutiny: It paid doctors who sent it patients' blood for testing. (http://on.wsj.com/1ohdXDd)
* Those hoping for a Goldilocks economy (not too hot, not too cold) got a boost from Friday's softer-than-expected August jobs numbers. Concerns had been spreading that strong job creation would push the Federal Reserve to raise interest rates as soon as March 2015, instead of June or September as most forecasters currently expect. Strong job creation is good for the public, but rate increases are bad for stocks and bonds, so the soft report was a relief to Wall Street. (http://on.wsj.com/1rrVNj2)
* Alibaba Group Holding Ltd <IPO-BABA.N> and its bankers have been talking with investors about the Chinese e-commerce giant's potentially $24 billion initial public offering for over a year. But this week, as they begin the formal sales pitch, they will seek to resolve a crucial question: How much stock do investors want to own, and what will they pay for it? (http://on.wsj.com/1quZ9Wu)
* General Motors Co plans to launch by 2016 cars with a hands-free automated driving system and Wi-Fi-enabled vehicle-to-vehicle communications systems designed to help avoid collisions, intensifying the race among the world's auto makers to build cars that can partially drive themselves and avoid crashes without the help of their human drivers. (http://on.wsj.com/1w5yXVz)
* Japan's biggest online shopping mall, Rakuten Inc , has reached a basic agreement to buy U.S. cashback-shopping website operator Ebates for about 100 billion yen ($951.75 million) to better access U.S. consumers and grow abroad, a person familiar with the matter said Sunday. (http://on.wsj.com/1rs2X6U)
* When top Netflix Inc executives arrived in Paris earlier this year to help prepare a European expansion, they were greeted with an open letter from a group of French film producers warning of an "implosion of our cultural model." Netflix's response was a charm offensive. In a series of meetings with French government officials, executives said they planned to inject tens of millions of euros into France by marketing the Netflix service, striking deals for older French movies and TV shows and eventually shooting an original, French-language TV series set in the country, according to people who attended the meetings. (http://on.wsj.com/1uFxUYE)
* While BP Plc has pledged to fight a federal judge's ruling that it acted recklessly in the fatal 2010 Deepwater Horizon explosion and spill, Thursday's decision may ratchet up pressure for it to pursue a different tack: settle. A federal judge's ruling that BP recklessly failed to heed warning signs ahead of the Deepwater Horizon disaster may ratchet up pressure on the oil giant to settle rather than face an up to $18 billion fine. (http://on.wsj.com/1udznXN)
* Walgreen Co, facing mounting pressure from analysts and shareholders, said it is giving activist investor Jana Partners LLC two board seats, a relatively large say for a shareholder with a little more than 1 percent of the company's stock. (http://on.wsj.com/1udzH91)
FT
The UK government sent a filing to the U.S. Supreme Court arguing over the $18 billion fine imposed on BP PLC. The UK government said, the company was being forced to pay a huge sum of money to individuals and businesses who were not particularly affected by the spill.
Michel Barnier, the European Union commissioner said that the bankers' cash allowances were wrongly classified as fixed pay as they are paid selectively to senior staff, and are limited in duration and get cancelled sometimes.
European oil group Royal Dutch Shell Plc and a sovereign wealth fund from Oman are investing $53 million into California based Glasspoint, a small solar power company that increases crude oil production using renewable energy.
Vodafone has developed a mobile wallet service with Visa Inc, and plans to launch it in the UK next month. This service works with a special SIM card embedded with near field communication technology and can be used to swipe for payments at contactless tills.
Mark Cutifani, chief executive of Anglo American Plc ruled out BHP Billiton Plc's restructuring methods and said he preferred piece-by-piece asset sales in restructuring the mining group.
NYT
* After General Motors emerged from bankruptcy and a government bailout five years ago, the board of directors of the "new G.M." was expected to keep a more watchful eye on a company that had gone seriously off track. But on the issue of vehicle safety, the board until recently took a mostly hands-off approach, rarely even discussing the topic beyond periodic reviews of product quality with company executives, according to interviews with current and former board members. (http://nyti.ms/Ww1XX2)
* Just as the iPod's appeal relied in part on Apple Inc's music industry relationships, the future of its new wrist device may rest on courting health companies. (http://nyti.ms/1rSRbc8)
* Hourly workers often face unpredictable schedules and fluctuating hours each week, but at a Macy's Inc in Manhattan, a union has made a difference. (http://nyti.ms/1tDHj62)
* Alibaba <IPO-BABA.N>, started by Jack Ma in 1999, is about to sell shares in the United States that could value the company at about $160 billion. (http://nyti.ms/1uFwDAI)
* Public health experts say hundreds of children under 16 continue to work in America's tobacco fields, where they are exposed to harmful chemicals like nicotine. (http://nyti.ms/1CHlKUI)
* Stronger computing power, improved satellite and radar technology and more sophisticated scientific models give airlines a greater understanding of flying conditions. This means they can better plan their operations before flights - for instance by canceling flights early and avoiding stranding passengers at airports.(http://nyti.ms/1rSPafV)
Canada
THE GLOBE AND MAIL
** Lawyers for 182 former General Motors Co car dealers across Canada will face off with General Motors of Canada Ltd in a Toronto courtroom this week, as a trial begins in a C$750 million ($687 million) class action alleging the car maker unfairly pressured the dealers to give up their businesses as it sought a government bailout during the financial crisis. (http://bit.ly/1lQyG5N)
** Toronto Mayor Rob Ford's office asked city staff to look into using one of their most coercive powers - the expropriation of privately owned land - to help a client of the mayor's family business add more parking spaces. Mayor Ford's relationship with Apollo Health and Beauty Care, a soap manufacturer that contracts the Ford family's printing company to make labels for its products, is the focus of an ongoing investigation by Toronto's integrity commissioner. (http://bit.ly/1uFSx6T)
** Canada is experiencing a serious shortage of an essential drug for the treatment of bladder cancer. The shortfall, which is due to manufacturing problems at plants operated by two different pharmaceutical companies, could have major consequences for patients. (http://bit.ly/1xx3dKF)
NATIONAL POST
** With use of drones for commercial uses illegal in the United States, startups are popping up in Canada that offer services from monitoring crops to selling real estate. (http://bit.ly/1CIgKzf)
** Quebec Premier Philippe Couillard is now downplaying his desire to have Quebec sign the Canadian Constitution. A day after suggesting he'd like the province to do so by 2017 for the 150th anniversary of Confederation, Couillard told reporters on Sunday that his top priority is the economy. (http://bit.ly/1lMDoRx)
** As potential jurors enter a Montreal courtroom on Monday for jury selection in the first-degree murder trial of Luka Magnotta, few will encounter a complete stranger in the defendant. Accused in the brutal murder of Chinese university student Lin Jun, Magnotta, 32, who changed his name from Eric Clinton Kirk Newman, is already infamous. (http://bit.ly/1qGSVS0)
Hong Kong
SOUTH CHINA MORNING POST
* Zhang Yaqin, the man who helped build Microsoft's biggest technology research operation outside of the United States, is leaving the software giant to join Chinese online search powerhouse Baidu. Sources close to Baidu said Zhang would report directly to Robin Li Yanhong, the co-founder of Baidu. (http://bit.ly/1w5CkMd)
* The gutter oil scare deepened in Hong Kong and Macau after it emerged that another importer in the city and 21 businesses in the former Portuguese enclave had purchased oil from the Taiwanese supplier at the centre of the scandal. The Hong Kong importers include Dah Chong Hong Holdings Ltd. (http://bit.ly/1wdzF0i)
* Sun Hung Kai Properties Ltd is likely to become Hong Kong's biggest supplier of small flats once its application to convert four luxury residential projects in the northeast New Territories into 4,000 tiny apartments wins approval, according to industry observers. (http://bit.ly/1ogDgVY)
THE STANDARD
* China Auto Rental opens the retail book for its HK$3.62 billion ($467 million) initial public offering in Hong Kong, with 426 million new shares in a range of HK$7.50-HK$8.50 each. Shares of the country's largest auto rental firm, which aims to double the size of its fleet, start to trade on September 19. (http://bit.ly/1uFpdgU)
* A much-hyped idea to link bourses in Hong Kong and Shenzhen is not in the pipeline, China's securities watchdog said, saying one of its current priorities is to hammer out taxation issues for the upcoming Shanghai-Hong Kong Stock Connect program. (http://bit.ly/1tjjuwd)
HONG KONG ECONOMIC JOURNAL
* Chinese shipbuilder China Rongsheng Heavy Industries Group said an independent third party is considering to initiate a potential restructuring involving its unit Jiangsu Rongsheng Heavy Industries Co Ltd. The unit contributed a respective 89 percent and 91.4 percent of China Rongsheng's total revenue for 2013 and for six months ended in June 2014.
HONG KONG ECONOMIC TIMES
* Yuzhou Properties Co Ltd has earmarked 3 billion yuan ($488 million) to replenish landbank in China in the second half of 2014, according to chairman Lam Lungon.
Britain
The Times
PARTIES UNITE IN LAST-DITCH BID TO SAVE THE UNION
David Cameron and Ed Miliband will unite this week to make a last-ditch attempt to save the union by publishing a government paper that commits to handing more powers to Scotland within days of a "no" vote. (thetim.es/1oVKrT7)
ALIBABA TO HELP UK FIRMS FIGHT THE FAKES
British brands fighting the onslaught of Chinese counterfeiters have secured a landmark agreement from Alibaba Group Holding Ltd <IPO-BABA.N> , the internet commerce titan whose imminent listing in New York will vie to be the largest flotation in corporate history. (thetim.es/1pF40Pp)
The Guardian
SCOTTISH INDEPENDENCE: POUND COULD DROP 10 PCT IN VALUE
Scottish independence is expected to knock up to 10 percent off the value of sterling, taking it back to levels last seen when Britain was in recession. Nervous traders have already begun to sell the pound in response to narrowing polls. The currency suffered its worst week in more than a year last week. (bit.ly/1w5olWN)
NORTHERN COMMUTERS FACE BIG RISE IN FARES FOR EVENING TRAVEL
Rail passengers in the north of England are facing large increases in the cost of travel after the introduction of peak evening fares on train services from Monday. (bit.ly/1oVMp5I)
The Telegraph
RYANAIR POISED FOR HUGE BOEING AIRCRAFT ORDER
Ryanair Holdings Plc will on Monday announce a major order for Boeing Co's new 737 MAX jetliner as the colourful low cost airline seeks to boost passenger numbers by almost half to 120 million over the next decade. (bit.ly/1xv0CAR)
MPs WILL GET 10 PERCENT PAY RISE, EXPENSES WATCHDOG SAYS
MPs' pay will rise by 10 percent next year, taking their salaries to 74,000 stg ($120,000), the new head of parliament's expenses watchdog has said, despite warnings from David Cameron that such an increase would be "simply unacceptable". (bit.ly/1rRL0VF)
Sky News
EUROPE AGREES ON FRESH RUSSIAN SANCTIONS
European leaders have agreed to hit Russia with a fresh round of sanctions - despite Moscow signing up to a ceasefire in Ukraine. The sanctions include credit restrictions on Russian companies, export bans, travel bans and asset freezes on a new set of officials. (bit.ly/1lLzJ6u)
EXODUS OF BRITS FROM ECONOMIC WOES IN CYPRUS
British expats are packing up and leaving Cyprus as the effects of the financial meltdown continue to be felt. Removals firms on the island have seen huge demand from people moving back to the UK, with immigration from the east helping replace those on their way out. (bit.ly/1qyo770)
The Independent
CALAIS TO BE OFFERED 9FT-HIGH NATO SUMMIT STEEL SECURITY FENCE TO DETER MIGRANTS
Ministers have approved giving Calais the 9ft-high "Ring of Steel" security fence that had been used at the NATO summit, to help tackle the issue of migrants seeking to illegally board ferries and trucks bound for the UK. (ind.pn/1ofZWWq)
FOUNDER PETER CRUDDAS SIGNALS 1 BLN STG FLOAT AFTER CMC STORMS INTO PROFIT
CMC Markets founder Peter Cruddas today flagged up a 1 billion stg float as he put his spread betting firm back into the black. The former Conservative co-treasurer, who resigned from the party two years ago after a cash-for-access sting, unveiled pre-tax profits of 32.8 million stg in the year to 31 March, turning around a 4 million stg loss in the prior year. (ind.pn/1AeRBYW)
Fly On The Wall Pre-Market Buzz
ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
Consumer credit for July at 3:00 pm ET--consensus up $17.3B
ANALYST RESEARCH
Upgrades
Bank of America (BAC) upgraded to Buy from Neutral at Goldman
FireEye (FEYE) upgraded to Buy from Neutral at UBS
Infinera (INFN) upgraded to Buy from Hold at Jefferies
L-3 Communications (LLL) upgraded to Outperform from Perform at Oppenheimer
Matrix Service (MTRX) upgraded to Buy from Hold at KeyBanc
Pinnacle West (PNW) upgraded to Outperform from Market Perform at Wells Fargo
Ternium (TX) upgraded to Overweight from Neutral at JPMorgan
Downgrades
Bonanza Creek (BCEI) downgraded to Outperform from Strong Buy at Raymond James
Fairchild (FCS) downgraded to Neutral from Positive at Susquehanna
Ford (F) downgraded to Underweight from Equal Weight at Morgan Stanley
Keryx (KERX) downgraded to Underperform from Market Perform at FBR Capital
Portland General Electric (POR) downgraded to Market Perform at Wells Fargo
Initiations
AIG (AIG) initiated with a Buy at Citigroup
C1 Financial (BNK) initiated with a Buy at Wunderlich
C1 Financial (BNK) initiated with an Outperform at Keefe Bruyette
Enable Midstream (ENBL) initiated with an Equal Weight at Morgan Stanley
Enservco (ENSV) initiated with an Outperform at Northland
Gulfport Energy (GPOR) initiated with an Equal Weight at Morgan Stanley
Husky Energy (HUSKF) initiated with a Buy at Citigroup
Illumina (ILMN) initiated with an Equal Weight at Morgan Stanley
Otonomy (OTIC) initiated with an Overweight at Piper Jaffray
PerkinElmer (PKI) initiated with an Overweight at Morgan Stanley
Thermo Fisher (TMO) initiated with an Overweight at Morgan Stanley
Waters (WAT) initiated with an Underweight at Morgan Stanley
Westlake Chemical Partners (WLKP) initiated with a Buy at Deutsche Bank
Westlake Chemical Partners (WLKP) initiated with a Neutral at BofA/Merrill
Whiting Petroleum (WLL) initiated with an Equal Weight at Morgan Stanley
COMPANY NEWS
General Electric (GE) to sell appliances business to Electrolux AB (ELUXY) for $3.3B
FMC Corporation (GMC) to acquire Cheminova for $1.8B
Walgreen (WAG) appointed JANA's Barry Rosenstein to board of directors
Fossil (FOSL), Intel (INTC) announced collaboration to develop innovation in wearable tech
TriQuint (TQNT) shareholders approved merger-of-equals with RF Micro Devices (RFMD)
Amazon.com (AMZN) secured $2B credit arrangement
EARNINGS
Companies that missed consensus earnings expectations include:
Piedmont Natural Gas (PNY)
Douglas Emmett (DEI) lowers FY14 FFO view by 5c to $1.53-$1.57, consensus $1.61
Piedmont Natural Gas (PNY) reaffirms FY14 EPS $1.80-$1.90, consensus $1.89
NEWSPAPERS/WEBSITES
GM (GM) to introduce hands free Cadillac model in two years, Bloomberg reports
CenturyLink (CTL) said to seek Rackspace (RAX) acquisition, Bloomberg reports
Ryanair (RYAAY) could place $10B Boeing (BA) order, Reuters says
Sharp (SHCAY) aims to sell U.S. solar-energy development division, Bloomberg reports
T-Mobile (TMUS) files suit against China's Huawei , Re/code says
Discovery (DISCA): Comcast (CMCSA)-TWC (TWC) merger gives unfair advantage, NY Post reports
lululemon (LULU) expected to report sharply lower profit, WSJ reports
United Technologies (UTX) could return 20%, Barron's says
Boeing (BA) shares could climb 20%, Barron's says
Multimedia Games (MGAM) looks inexpensive, Barron's says
SYNDICATE
Ascent Solar (ASTI) files to sell 1M shares for holders
Sequential files to sell 14.33M shares of common stock
Uranium Energy (UEC) files to sell 1.86M shares of common stock