Morning brief 23rd May 2014

Abstracts from Top Bloomberg stories on Stocks and currencies:

Main
1)  U.S. Stocks Rise on Factory Data as Retailers, Small-Caps Rally
    (Bloomberg) -- U.S. stocks rose, sending the Standard & Poor’s 500 Index to near a record, and small-cap shares rebounded as data showing strength in manufacturing boosted confidence in the global economy. Best Buy Co. and Williams-Sonoma Inc. added at least 3.4 percent to pace gains among retailers. An index of homebuilders rallied as sales of previously owned U.S. homes rose in April.

2)  BofA Said to Abandon Market-Making Unit Amid Industry Scrutiny
    (Bloomberg) -- Bank of America Corp. is dismantling an electronic market-making unit created last year to serve the lender’s Merrill Lynch wealth-management division, said two people with knowledge of the decision. Increased regulatory scrutiny of U.S. equity markets and managers’ concerns for the potential perception of a conflict of interest killed the project, said the people.

3)  E*Trade Babies Are Unafraid of Flash Boys as Stock Trading Booms
    (Bloomberg) -- If the stock market is rigged to fleece the little guy, someone forgot to warn the little guy. Trading in online brokerage accounts that cater to individual investors is at an all-time high and they attracted new assets every quarter since 2010, according to analyst Ana Avramovic at Credit Suisse Group AG.

Americas
4)  Boomers Cash In as U.S. Stock Market Aids Exodus From Workforce
    (Bloomberg) -- Dee Dix hesitated before she decided to retire in 2012. “I thought, do we have enough money? How much do we need?” the 66-year-old former insurance analyst said from her home in Fort Myers, Florida. “I was a little bit leery.” Clinching the decision was profit earned on stock investments during a five-year bull market that has restored $14 trillion to U.S. equity values.

5)  Bed Bath & Beyond Shares on Sale Rack After 24% Plunge: Options
    (Bloomberg) -- The 24 percent drop in Bed Bath & Beyond Inc. this year has left the stock the cheapest ever compared to competitors and traders are betting on a rebound. Investors speculating on a rally have pushed up the price of bullish options to the most expensive level on record relative to bearish ones, according to data on three-month contracts compiled by Bloomberg.

6)  Ibovespa Advances After Election Poll as Metals Gain Buoys Vale
    (Bloomberg) -- The Ibovespa climbed as a drop in Brazil’s jobless rate improved the outlook for consumer stocks, while mining companies and steelmakers followed metals higher. Centrais Eletricas Brasileiras SA rose for the first time in four days as an election poll showed increased support for Brazilian opposition candidates, raising the prospect of a new government that will reduce intervention in state-run companies. Iron-ore miner Vale SA climbed a second day.

7)  U.S. AFTER-HOURS MOVERS: ARO ARUN DRYS GME HPQ KERX MRVL MTDR
    (Bloomberg) -- Equity movers in late trading, with shrs traded post-mkt: Advancers: * ZIOP +6.7% (15k); Therapy Cuts Cancer Cells in Glioma Model Advancers after earnings: * TFM +10.8% (154k) * NDSN +2.8% (1k) * GME +2.2% (325k) Decliners: * MTDR -6.4% (6k); 7.5m-Shr Secondary * KERX -2.1% (18k); Zerenex Pdufa Date Moved to Sept. 7 Decliners after earnings: * ARO -17% (559k) * ARUN -5.6% (77k); 3Q Adj. Gross Margin Missed est.

Europe, Africa, Mideast
8)  Russia Sanction Naysayers Collect $90 Billion: Chart of the Day
    (Bloomberg) -- Investors who have ignored international sanctions against Russia are being rewarded. The CHART OF THE DAY shows the MSCI Russia Index of stocks has gained 22 percent, adding about $90 billion in market value since March 17, when the U.S. banned President Vladimir Putin’s business allies in response to his annexation of Crimea. MSCI’s emerging-market gauge jumped 10 percent during the period, while the Standard & Poor’s 500 Index rose 2.9 percent.

9) European Stocks Climb Second Day as Daily Mail, Raiffeisen Jump
    (Bloomberg) -- European stocks rose for a second day as better-than-forecast manufacturing figures in China and the U.S. offset euro-area output data. Daily Mail and General Trust Plc surged 8.9 percent after announcing Zoopla Property Group’s initial public offering. Raiffeisen Bank International AG added 6 percent after posting first-quarter profit that beat analysts’ estimates.

10) Sberbank Drops as CEO Says Economy Stagnating: Russia Overnight
    (Bloomberg) -- OAO Sberbank fell for the first time in four days, helping lead declines in Russian stocks trading in the U.S., as the lender’s chief executive officer said the Ukraine crisis is hurting the economy more than he expected. Sberbank, which holds about half of Russia’s deposits and is the country’s biggest bank, fell 0.8 percent to $10.01 in New York yesterday, pushing its loss this year to 20 percent.

11) German Stocks Advance as U.S., China Reports Outweigh Euro PMI
    (Bloomberg) -- German stocks rose as better-than- expected U.S. and Chinese manufacturing reports outweighed worse-than-forecast euro-area output data. Kloeckner & Co SE advanced 4.2 percent after Goldman Sachs Group Inc. upgraded the steel trader. Mobotix AG slipped 5.7 percent after half-year earnings-per-share dropped 64 percent and the maker of video cameras cut its full-year outlook. The DAX Index added 0.2 percent to 9,720.91 at the close of trading.

12) Astra-Pfizer Deadline Unlikely to Be Extended, Survey Says
    (Bloomberg) -- The deadline for Pfizer’s final proposal for AstraZeneca is unlikely to be extended beyond May 26 nor is the board seen giving into shareholder pressure to talk to Pfizer, according to a survey by Bloomberg First Word. * According to survey of 25 M&A/Event Driven desks, bankers, equity analysts and fund managers, there is 78.5% chance U.K. Takeover Panel’s May 26 deadline passes without extension, 12.7% probability it’s ...
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Asia, Australia, New Zealand
13) Most Asian Futures Rise as Yen Holds Losses; Baht Forwards Gain
    (Bloomberg) -- Most Asian index futures paced gains in U.S. stocks and the yen traded near a one-week low as manufacturing data boosted optimism in the world’s biggest economies. Thai baht forwards climbed as the currency held declines after a military coup, while platinum retreated. Futures on indexes from Japan to Australia and Hong Kong advanced during the U.S. session, which saw the Standard & Poor’s 500 Index rise a second day.

14) Thai Stock Values Unattractive as Coup to Spur Sales: StanChart
    (Bloomberg) -- Investors will probably sell Thai stocks as political situation is “very unclear,” Ryan Tsai, Asia equity strategist at Standard Chartered, says from Hong Kong. * “What worries me more is the slowing growth momentum for both the economy and corporate earnings,” he says * Thai price-earnings ratios are higher than long-term avg and investors should wait for better entry points: Tsai *

15) Beijing-Style Greenspan Put Loses Hold on China Stock Market
    (Bloomberg) -- China stock strategists are losing faith in the Beijing Put. Speculation that policy makers will act to keep a floor under share prices, providing similar protection against losses as the derivatives contracts that give the right to sell a security, has fueled at least five rallies in the Shanghai Composite Index since June. The latest was a 0.8 percent increase yesterday

17) Indian Stocks Advance as Power Utilities, Metal Producers Climb
    (Bloomberg) -- Benchmark Sensex climbed to near record, led by power utilities, property developers and metal producers. * Sensex +0.3% to 24,374.40; gauge headed for second week of gain after Bharatiya Janata Party-led bloc secured largest victory in 30 years * NTPC +5.9%, biggest gainer on Sensex; Tata Power +3.2% to highest price in 16 mos.; Tata Steel +1.8% to highest level in two years; Coal India +5.1% to highest close since Sept. 2011.

18) Huawei Develops Trading Platform for HK-Shanghai Exchange Link
    (Bloomberg) -- Co. and Infocast jointly develop one- stop securities trading platform that can process high volume of transactions, according to a statement. * Platform can handle 1,000 single transactions per second * System can support diversified services including the Shanghai-Hong Kong stock connect program.

Currencies

Main
19)  Euro Falls to Three-Month Low on Easing Speculation; Baht Drops
    (Bloomberg) -- The euro fell to almost a three-month low amid signals from European policy makers of willingness to undertake further monetary easing and as anti-establishment political groups seek to win power at polls this weekend. The yen dropped the most in two weeks as a report signaling an improving outlook for Chinese manufacturing boosted stocks and damped haven demand.

20)  Euro Bears Detect Vindication as Futures Show Shift: Currencies
    (Bloomberg) -- The stars are finally aligning for euro bears. Firms from Morgan Stanley to Bank of America Corp. that for almost a year called for weakness in the 18-nation currency, only to see it soar to the highest level since 2011, say they’re about to be vindicated. Fresh evidence of lower demand for the region’s bonds, combined with a potential European Central Bank interest-rate cut.

21)  Thai Baht Plunge Is No Bear Market Sign to Coup-Savvy Investors
    (Bloomberg) -- Within a minute of Thailand’s army announcing a coup, the baht fell 0.6 percent versus the dollar. Templeton Emerging Markets Group and Samsung Asean Equity Fund say any market weakness will be shortlived. “We view the current military coup as likely overall positive as it creates a more stable environment,” Mark Mobius, who oversees about $50 billion as the group’s executive chairman, said by e-mail.

Americas
22)  Tombini Saying Less Demand for Hedge in Brazil Weakens Real
    (Bloomberg) -- Brazil’s central bank President Alexandre Tombini said demand at daily swap auctions has eased, signaling the bank may scale down or end the program that aimed to support the real. The currency erased earlier gains and dropped the most among emerging markets following the comments. The daily auctions are due to expire on June 30.

23)  New Faces Behind Fed Dots Seen Roiling Markets as Forecasts Move
    (Bloomberg) -- Turnover among Federal Reserve policy makers gives investors more reason to heed Chair Janet Yellen’s advice: don’t pay too much attention to officials’ interest-rate forecasts. Two central bankers will leave the Fed this month, and three are poised to join before the June 17-18 meeting of the Federal Open Market Committee, when the next set of quarterly forecasts will be released.

24)  Gain in U.S. Home Sales Lifts Spring Prospects: Economy
    (Bloomberg) -- Previously owned U.S. home purchases increased in April as a bigger supply of properties lured buyers and raised prospects for a stronger spring buying season. The 1.3 percent gain, the first this year, pushed sales to a 4.65 million annualized rate, National Association of Realtors data showed today. The number of available properties climbed to an almost two-year high.

25)  USD/CAD Has Positive Undertone, Firm Support at 1.0900/10: TD
    (Bloomberg) -- Risk of big drop back in USD/CAD reduced now that pair has broken back through trend resistance drawn off 1.1047 late April high, TD strategists led by Shaun Osborne write in note. * Think USD/CAD “doing some positive spadework” to break out of decline in place since March, weekly signals turning “a little more constructive” * Gains through 1.0949 40-DMA today would enhance prospects *

Europe, Africa, Mideast
26)  Pound Falls First Time in 6 Days After GDP Report, Finance Data
    (Bloomberg) -- The pound fell for the first time in six days versus the dollar after reports showed first-quarter gross domestic product matched economist estimates and Britain’s deficit was bigger in April than analysts forecast. Sterling weakened against 12 of its 16 major counterparts. The U.K. currency has surged in the past year as data that exceeded the Bank of England’s forecast prompted investors to bring forward their expectations.

27) Marcus Hesitates on Rate as South Africa Strike Hammers Economy
    (Bloomberg) -- South Africa’s central bank is more worried about a four-month platinum strike than inflation right now. The bank left its benchmark lending rate unchanged at 5.5 percent, a decision backed by five of the seven Monetary Policy Committee members and predicted by 26 of 30 economists surveyed by Bloomberg. The other two MPC members voted for an increase. Even with inflation above the bank’s 3 percent to 6 percent target, and not ...
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28) EUR May Fall Further Vs USD on Rate Differential, SocGen Says
    (Bloomberg) -- EUR may continue to drop choppily vs USD due to a closer correlation going forward with interest rates differential between EU and U.S., Kit Juckes, FX strategist at Societe Generale, writes in client note. * 2-year euro rates fell sharply ahead of rate cuts in May, November last year, bounced a few weeks later; no reason to expect a different outcome in coming weeks * This scenario would justify EUR/USD continuing to fall..

Asia, Australia, New Zealand
29) JPMorgan Bullish as Modi to Boost Inflation Fight: India Credit
    (Bloomberg) -- JPMorgan Asset Management and DSP BlackRock Investment Managers Pvt. are among bond funds betting India’s new government can unblock bottlenecks that have fueled the highest inflation among Asia’s 10 biggest economies. JPMorgan Asset sees the 10-year sovereign yield falling as much as 46 basis points to 8.25 percent by year-end, while DSP BlackRock predicts a drop to as low as 8.40 ...

30) Aussie Drop Seen by broker and Westpac as RBA Rate Rise Bets Shrink
    (Bloomberg) -- Broker and Westpac Banking Corp. predict the Australian dollar will weaken this year as waning expectations of interest-rate increases by the Reserve Bank and technical indicators point to declines in the currency. A Credit Suisse Group AG index shows traders see little change to Australia’s cash rate over the next 12 months, after expecting it to be as much as 22 basis points higher in April. The Aussie dropped on May 21 to the lowest in more than ...

31) BOJ Policy Planner Amamiya Seen Being Asked for Rare Second Term
    (Bloomberg) -- The Bank of Japan’s chief executor of its unprecedented monetary stimulus, Masayoshi Amamiya, is expected by central bank and Abe administration officials to be reappointed to a rare second term, according to people familiar with the discussions. BOJ Governor Haruhiko Kuroda and his board are charged with making the determination -- subject to the approval of Finance Minister Taro Aso

32) What China Property Crash? Say Economists Seeing Growth Bump
    (Bloomberg) -- China’s biggest homebuilding slump in at least four years isn’t enough to dissuade a majority of economists from predicting real estate will still contribute to 2014 growth. Property controls will be eased, they said in a Bloomberg News survey. While 12 of 18 economists say China has some national oversupply of housing, only seven say the market is in a bubble state countrywide, according to the survey conducted from May 15 to May 20.

33) FX DAYBOOK ASIA: Taiwan GDP, Factory Output, Singapore CPI
    (Bloomberg) -- Taiwan GDP, factory output today; investors watching situation in Thailand after military coup, USD/THB +0.4% to 32.578 during NY trading. * BBDXY +0.13%; JPM EMFX +0.06% * Today: Taiwan GDP and factory output, Singapore CPI, New Zealand consumer confidence * NOTE: Click here to subscribe to the FX Daybook * U.S. eco data: Initial jobless claims 326k vs. est. 310k; Markit U.S. manufacturing PMI (May P) 56.2 vs. est. 55.5;