Friday Pre-Market News


very morning the Street of Walls team puts out an update on market levels, today’s top stories, and active M&A deals.

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Morning Market Levels:

  • S&P futures are down -4 points to 1,252
  • Europe: DJ Euro Stoxx -0.3%, FTSE 0.3%, CAC -0.4%, DAX -0.7%, Spain 0.3%, Italy -0.6%
  • Asia: Japan 1.9%, Hong Kong 3.1%, India 0.5%, Australia 2.6%
  • USD (DXY) up 0.11%
  • Gold down -0.32% to $1,757.7
  • Silver down -0.64% to $34.3
  • Copper up 0.32% to $360.0
  • Crude up 0.11% to $94.2
  • Corn down -0.08% to 653.0
  • Wheat down 0.00% to $636.0
  • 10yr Treasury yields are up, trading at 2.13%
  • S&P current trading at 12.68x current year P/E

Today’s Top Stories:

[Exclusive] ExodusPoint Is In The Green YTD Led By Rates And EM/ Macro Strategies

Invest ESG Leon CoopermanThe ExodusPoint Partners International Fund returned 0.36% for May, bringing its year-to-date return to 3.31% in a year that's been particularly challenging for most hedge funds, pushing many into the red. Macroeconomic factors continued to weigh on the market, resulting in significant intra-month volatility for May, although risk assets generally ended the month flat. Macro Read More

  • Senate blocks $60 billion infrastructure plan: The Senate shot down another piece of President Obama’s $447 billion jobs bill Thursday, as a stalemated Congress goes through the motions of attempting legislation to spur economic growth largely as a mechanism to allow each party to blame the other for the failure to act
  • Jefferies Wanted to Buy Some MF Global: Days after securities firm MF Global Holdings Inc. filed for bankruptcy protection after disclosing a $6.3 billion bet on European government debt, Jefferies was forced to respond to a credit-ratings firm report over its sovereign holdings
  • Jefferies Has Huge Sovereign Exposure: Egan Jones downgraded Jefferies on concerns about sovereign exposure amounting to 77% of equity.  This is a self-fulling prophecy, as the their stock price falls that number gets bigger and bigger.  Is Jefferies the next MF Global?
  • Special Europe Money Being Considered: World leaders are actively considering mandating the International Monetary Fund to print more of its special currency to help solve the euro-zone crisis, according to several people familiar with the matter
  • Options around Gov’t Super Committee: “the options market is underestimating the potential for volatility around the Joint Committee on Deficit Reduction (aka Super Committee) meetings leading up to the November 23 deadline, just as it did around the budget negotiations in July. Options prices are elevated due to concerns about Europe among other items, but the sector tilt in the options market shows a lack of concern about US fiscal debate, in the team’s view” (Goldman Reseach)
  • Icahn Buys more Navistar (NAV): Carl Icahn increased his stake in Navistar International (NYSE:NAV) to 9.99% of the outstanding common stock. The filing states, “The  Reporting  Persons  hold,  in  the  aggregate,  7,251,426  Shares. The aggregate  purchase  price  of  the  Shares  purchased  by the Reporting Persons collectively  was  approximately  $260.8  million  (including  commissions  and premiums).” NAV had 72,571,312 common shares outstanding as of August 31, 2011
  • KKR Earnings: “KKR Financial’s 3Q EPS was down sequentially from $0.59 and below our estimate of $0.41 primarily due to unrealized losses on investments and foreign currency translation losses. However, net investment income of $0.48 per share, was ahead of our $0.44 per share estimate given strong returns from natural resources investments” (Deutsche Bank Research)

Economic Calendar:

  • Friday: Nonfarm Payrolls, Unemployment Rate

M&A Watch:

  • Tingyi (Cayman Islands) said to buy PepsiCo’s ops in China excluding food business (BBG)
  • MF Global’s Asian units may be sold as soon as this weekend after liquidators received between 30 and 40 “credible” purchase offers, WSJ reports
  • Delphi Automotive, former parts unit of General Motors, said to set terms for IPO by tomorrow, begin pitching to investors next week; will seek $550m (BBG)
Disclosure: I do not have a position in any stocks mentioned in this article, do not have a plan to initiate a position within the next 72 hours.
Disclaimer:  The information, opinions, material, and any other content provided in this article is for informational purposes only and is not to be used or considered an offer or solicitation to buy or sell securities, investment products, financial instruments, or to participate in any particular investment strategy. The information, opinions, material, and any other content provided in this article does not constitute as a recommendation or as advice to buy or sell securities, investment products,  financial instruments, or to participate in any particular investment strategy.

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