US Market News

JP Morgan (JPM +5.96% to $36.07) reported for its 2Q a net income of $5B compared with $5.4B a year ago and an EPS of $1.21 compared with $1.27 in 2011. The Co also said the London trading losses were $4.4B pretax and announced it will restate its previously-filed interim financial statements for 1Q 2012 and reduce its net income by $459M. The Co added: "Importantly, all of our client-driven businesses had solid performance. However, there were several significant items that affected the quarter's results - some positively; some negatively. These included $4.4B of losses on CIO's synthetic credit portfolio, $1.0 billion of securities gains in CIO and a $545M gain on a Bear Stearns-related first-loss note, for which the Firm now expects full recovery. The Firm's results also included $755M of DVA gains, reflecting adjustments for the widening of the Firm's credit spreads which, as we have consistently said, do not reflect the underlying operations of the Firm".

Wells Fargo (WFC +3.23% to $33.91) posted for its 2Q a diluted EPS of $0.82 ($0.81 expected) compared with $0.70 a year ago and $1.57 for 1H vs $1.37 in 2011. Revenue was $21.3B compared with $21.6B in 1Q. The Co added: "Wells Fargo's strong financial results this quarter again reflect the benefit of our diversified business model. While the economic recovery remains uneven, we continued to meet our customers' financial needs and benefited from signs of stabilization in the housing market. Our accomplishments reflect our continued focus on key Wells Fargo fundamentals".

Two Harbors Investment (TWO +0.28% to $10.75) announced a 3M shares underwritten public offering.

Noble Corp (NE +3.73% to $34.48) announced a 3 year term contract with Anadarko Petroleum (APC +1.01% to $68.81) on new ultra-deepwater drillships in South Korea. The Co added: "Revenues to be generated over the three-year term are expected to total approximately $677".

Phillips 66 (PSX +5.85% to $34.94): Buffet is said to have invested in the Co according to Bloomberg.

Cytec Industries (CYT +3.94% to $61.14) said it sees its EPS for 2Q 2012 in a range of $1.50 - $1.55.

Procter & Gamble (PG +2.18% to $65.09) board members are said to be discussing whether to replace CEO Robert McDonald reported Bloomberg.

Darden Restaurant (DRI +0.04% to $50.22) agreed to buy Yard House USA for $585M in an all-cash transaction. The Co added: "the transaction is expected to be dilutive to Darden's diluted net earnings per share in fiscal 2013 by approximately three to five cents and accretive thereafter".

Hewlett Packard (HPQ -1.91% to $18.98): printed a new 52w low.

Activision Blizzard (ATVI +1.68% to $12.1): Vivendi's Chairman said it may sell its $8.1B stake in the Co according to Bloomberg.

Lexmark (LXK -16.25% to $20.36) revised its guidance and said its GAAP EPS "are now expected to be in the range of $0.53 to $0.55, or $0.87 to $0.89 adjusted" compared with $0.65 to $0.75, or $0.95 to $1.05 adjusted, previously provided. The stock printed a new 52w low.

Dean Foods (DF -1.76% to $14.52) was downgraded to "neutral" from "buy" and Discovery Communications (DISCA) to "sell" from "neutral" at Goldman Sachs.

Supervalu (SVU -13.75% to $2.32) was upgraded to "neutral" from "sell" at UBS.

Edwards Lifesciences (ED +0.87% to $63.42) was downgraded to "neutral" from "outperform" at Credit Suisse.

Real Estate: Weyerhaeuser (WY +2.59% to $23.37), Health Care REIT (HCN +1.76% to $60.61), Equity Residential (EQR +1.76% to $64.76), HCP Inc (HCP +1.45% to $45.4), Ventas Inc (VTR +1.59% to $64.48), Public Storage (PSA +1.28% to $146.67) reached a new 52w high.

Utilities: Northeast Utilities (NU +2.05% to $39.88), CMS Energy (CMS +2.14% to $24.32), Wisconsin Energy Corp (WEC +1.09% to $40.91), Pinnacle West Capital (PNW +1.61% to $53.05), Integrys Energy Group (TEG +1.28% to $58.56), NextEra Energy (NEE +1.33% to $69.33), Scana Corp (SCG +0.93% to $48.73) reached a new 52w high.

Stocks 50D MA cross over: AIG (AIG +3.18% to $31.44), American Express (AXP +1.76% to $57.93), Ball Corp (BLL +2.95% to $41.23), Bank of America (BAC +4.55% to $7.82), Bank of New York Mellon (BK +3.42% to $21.77), Blackrock (BLK +1.92% to $175.78), Boeing (BA +2.51% to $73.51), CA Inc (CA +1.49% to $25.88), Cerner Corp (CERN +0.51% to $80.29), CH Robinson Worldwide (CHRW +2.29% to $60.3), Comerica (CMA +2.64% to $30.69), Dollar Tree (DLTR +1.42% to $52.77), Eastman Chemical (EMN +2.69% to $48.79), Exelon Corp (EXC +2.58% to $38.52), Expedia Inc (EXPE +3.65% to $45.67), Franklin Resources (BEN +4.5% to $113.88).

Stock/S&P500 ratios 50D MA cross under: AON Corp (AON +1.06% to $47.63), Autozone (AZO -0.39% to $380.94).
After Hours
Visa (V), MasterCard (MA) and a number of banks have agreed on a settlement concerning claims in the multi-district interchange litigation originally brought by a class of US retailers in 2005. Visa said: "The proposed settlement payments for both the Class and Individual claims would be appx. $6.6B, of which Visa's share would represent appx. $4.4B. Visa's share will be paid from the litigation escrow account established pursuant to Visa's Retrospective Responsibility Plan. (...) For the quarter ending June 30, 2012, Visa intends to record a litigation charge of appx. $4.1B, which will increase its total FAS 5 reserve for the litigation covered by the Retrospective Responsibility Plan from $285M to appx. $4.4B." MasterCard said: "MasterCard's share of the cash portion of the settlements will total $790M on a pre-tax basis. As a result, the Co will incur an additional $20M pre-tax charge in 2Q2012 financial statements. MasterCard had previously recorded a $770M charge in its 4Q2011 financial statements."

Apollo Global Management (APO) is said to be considering a bid for McGraw-Hill Cos (MHP)'s textbook publisher unit McGraw-Hill Education reported the WSJ.

Human Genome Sciences (HGSI) is said to be concluding talks on being bought by GlaxoSmithKline reported Reuters.

Thermo Fisher Scientific (TMO) may be close to acquire One Lambda for $1B according to Bloomberg.

NCR Corp (NCR) was recommended by Barron's.

Google Trend US - popular searches: Blackrock (BLK), Human Genome Sciences (HGSI), Humana (HUM)

Buckeye Partners (BPL) was downgraded to "market perform" from "outperform" at Wells Fargo.
Expect Today
Citigroup (C): 2Q EPS seen at $0.89 ($1.85 a year ago), before mkt.

Cintas (CTAS): 4Q EPS seen at $0.6 ($0.49 a year ago), after mkt.

Gannett (GCI): 2Q EPS seen at $0.53 ($0.58 a year ago), before mkt.

UK Market News
G4S announced it is unable to deliver all of the necessary workforce numbers for the London Olympic Games security contract, adding: "The Government has therefore decided to increase the number of military personnel who will work at the Games. (...) G4S accepts its responsibility for the additional cost of the increased military deployment resulting from the shortfall in workforce delivery. (...) it is estimated that the Co will incur a loss on the contract in the range of £35M-50M, all of which will fall in the current financial year."

Sage Group issued an Interim Management Statement: "Despite a toughening economic environment, trading remains broadly in-line with expectations at the time of the interim results announcement on 9 May 2012. (...) Whilst we remain cautious on the outlook for Europe, and watchful of this region's economic climate, the strong fundamentals of our business model remain and we continue to make good progress in executing against our business priorities."

Smiths Group announced the disposal of its minority stake in Florida-based biometric identification company Cross Match Technologies Inc to private equity firm Francisco Partners for up to $77M.

Cobham said it has secured an up to £14M long-term agreement from Astrium to produce fixed waveguides of various sizes and frequencies for telecommunication satellites during the next 18 months.

Glencore International has gained approval from Canada's industry minister for its C$6.1B takeover of Viterra and is waiting for approval by China's Ministry of Commerce.

GlaxoSmithKline is said to be concluding a deal to buy Human Genome Sciences reported Reuters.

WPP said its Kantar unit has completed the acquisition of an 87.76% stake in Press Index and would launch a public tender offer for the remaining outstanding shares.

Basic Resources media and insurance shares gained most in London on Friday.

Banks: Barclays (-0.83% to 162.15p) reached a new 3-month relative low against the FTSE 100.

Food & Beverage: SABMiller (+1.21% to 2672p) closed at a 3-month relative high against the FTSE 100.

Health Care: Smith & Nephew (+1.71% to 652.5p) reached a new 3-month relative high against the FTSE 100.

Industrial Goods & Services: BAE Systems (+2.13% to 306.4p) reached a new 3-month relative high against the FTSE 100.

Insurance: Amlin Plc (+1.11% to 365p) closed at a 3-month relative high against the FTSE 100.

Media: United Business Media (+3.31% to 608.5p) closed at a 3-month relative high against the FTSE 100.

Real Estate: Hammerson (+1.13% to 456.7p) reached a new 3-month relative high against the FTSE 100.

Retail: Debenhams (+2.89% to 89.15p) closed at a 3-month relative high against the FTSE 100.

Travel & Leisure: Greene King (+1.77% to 575.5p) and Easyjet (+1.01% to 548.5p) closed at a 3-month relative high against the FTSE 100.

Stock/Benchmark ratio(s) 50D MA cross over: Afren (+4.24% to 115.6p), Cobham (+1.9% to 235.4p), Home Retail (+1.24% to 81.8p), Informa (+2.32% to 388.1p), Kazakhmys Plc (+6.06% to 744p), London Stock Exchange (+2.09% to 1026p), Petropavlovsk (+8.61% to 461.6p), Wood Group (John) Plc (+3.46% to 748p)

Stock/Benchmark ratio(s) 50D MA cross under: Experian (-2% to 932p), G4S Plc (-1.52% to 278.7p), Wolseley (-0.3% to 2333p).

Stock(s) 50D MA cross over: Afren (+4.24% to 115.6p), Antofagasta (+2.98% to 1071p), BG Group (+1.29% to 1300.5p), BHP Billiton (+3.11% to 1805.5p), Drax Group (+1.8% to 566.5p), Electrocomponents (+6.36% to 212.4p), Fresnillo (+2.78% to 1444p), Glaxosmithkline (+0.73% to 1446p), Kazakhmys Plc (+6.06% to 744p), Melrose (+4.41% to 395.7p), Petropavlovsk (+8.61% to 461.6p), Rio Tinto (+3.21% to 3020p), Weir Group Plc (+2.88% to 1534p).
German Market News
ECB: Publication of the Euro area HICP statistics, 10 a.m. CET.

Deutsche Bank has offered to cooperate with the European Commission and the Swiss authorities on investigations into alleged fixing of the LIBOR in return for leniency, reported Der Spiegel. The stock (-1.9% to E25.59) closed at a 3-month relative low against the Dax.

Deutsche Post's 2Q continued to be good according to the Co's CEO interviewed by the Sueddeutsche Zeitung.

Chemicals: Wacker Chemie (-0.59% to E54.31) reached a new 3-month relative low against the Dax.

Media: Axel Springer (+4.96% to E36.47) and Kabel Deutschland (+4.28% to E51.2) closed at a 3-month relative high against the Dax.

DE - Stock/Benchmark ratio(s) 50D MA cross over: Continental (+4.23% to E70.73), Deutsche Euroshop (+3.78% to E29.93), GEA Group (+2.03% to E21.87), SGL Carbon (+5.1% to E32.69)

Stock/Benchmark ratio(s) 50D MA cross under: Heidelbergcement (-0.24% to E37.22).

DE - Stock(s) 50D MA cross over: Daimler (+3.31% to E36.4), Hochtief (+1.57% to E38.5), Lanxess (+3.49% to E54.33), Aurubis (+2.41% to E38.68), Prosieben (+3.62% to E17.91), SGL Carbon (+5.1% to E32.69)

AT - Stock(s) 50D MA cross over: Erste Bank (+0.89% to E14.8).

US Market News

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