12 Min Read
(For faster updates on individual market-movers, Eikon users please use search string "STXBZ US"; for more market insights, including options activity, ; for the Day Ahead newsletter, link.reuters.com/mex49s; for the Morning News Call newsletter, link.reuters.com/nex49s) Shares of SinoCoking Coal and Coke Chemical Industries were up as much as 200 percent in heavy volume following the coal processor's agreement to implement a technology to convert coal into syngas at four underground mines in China. The Dow Jones industrial average was down 0.44 percent at 17,036.37, the S&P 500 was down 0.37 percent at 1,994.13 and the Nasdaq Composite was down 0.33 percent at 4,577.087.
** SINOCOKING COAL AND COKE CHEMICAL INDUSTRIES, $8.3901, +187.33 pct
The coal processor signed an agreement to implement a technology to convert 21 million tons of coal at four underground mines in China into syngas, a clean burning fuel.
The mines were shut for three years due to the Chinese government's guidelines on mine consolidation. The first phase of the project will cost about $18 million and be funded primarily from cash reserves, while subsequent phases will cost about $280 million and be funded with bank loans and company-issued debt.
** APPLE INC, $100.0712, +1.74 pct
Apple Inc is expected to unveil a smartwatch, its first new device in four years, in a gala event on Tuesday that may also mark its long-awaited entry into the mobile payments sphere and deliver a larger iPhone.
** GENERAL MILLS INC, $53.25, -0.49 pct
** ANNIE'S INC, $46.15, +37.72 pct
General Mills Inc, the maker of Cheerios cereal and Betty Crocker cake mixes, said it would acquire organic food producer Annie's for about $820 million to expand its presence in the fast-growing U.S. natural foods market.
** THRESHOLD PHARMACEUTICALS INC, $4.84, +4.99 pct
Cantor Fitzgerald initiated coverage on the drug developer's stock with a "buy" rating and a $14 price target, based on the potential of its experimental cancer drug, code named TH-302. The brokerage expects peak revenue of $2 billion in 2025 for the drug in pancreatic cancer and soft tissue sarcoma indications. TH-302 is currently in late-stage trials.
** RADA ELECTRONIC INDUSTRIES, $5.1773, -13.28 pct
** LUNA INNOVATIONS INC, $1.96, +28.95 pct
Defense electronics contractor Rada Electronic's shares rose to a decade high before reversing course to trade down 20 percent. The company's stock soared 140 percent after posting strong results.
Luna Innovations shares were up "off the strength of Rada Electronic", said TheStreet.com. (bit.ly/1uuqTL5)
** WEIBO CORP, $21.502, +6.87 pct
T.H. Capital started coverage on the Chinese Twitter-like messaging service provider's U.S.-listed stock with a "buy" rating and price target of $24 on valuation grounds. The brokerage said Weibo was addressing concerns among investors regarding a slowdown in the company's user growth and "limited methods of monetization."
** SALESFORCE.COM INC, $60.19, -0.28 pct
The business software maker said a malware designed to steals users log-in credentials could have targeted some of its users.
** MICRONET ENERTEC TECHNOLOGIES INC, $4.12, +20.82 pct
Aegis Capital upgraded the rugged computer maker's stock to "buy" from "hold", according to theflyonthewall.com.
** CAESAR'S ENTERTAINMENT CORP, $12.27, -3.76 pct
The casino operator's shares fell after Trump Entertainment Resorts Inc filed for bankruptcy.
Caesar's Showboat casino in Atlantic City closed in end August, with three other casinos in the area. With Trump Taj Mahal set to close, it will be the third casino shuttering in less than a month in Atlantic City.
Gaming revenue in Atlantic city has fallen to $2.8 billion, a little more than half its 2006 peak of $5.2 billion.
** LEIDOS HOLDINGS INC, $32, -15.48 pct
The U.S. government IT contractor lowered its full-year adjusted profit forecast to $2.10-$2.30 per share from $2.35-$2.55.
The company said it expects to be hit by weakness in its health and engineering businesses and lower sales volume of higher-margin security products.
** HAIN CELESTIAL GROUP INC, $101.85, +4.15 pct
** WHITEWAVE FOODS CO, $36.77, +2.94 pct
J.P. Morgan Securities raised its price targets on the shares of organic products company Hain and dairy products producer WhiteWave.
The brokerage raised its price target on Hain stock to $113 from $102, citing an increased focus on healthy eating to push demand for Hain's better-for-you products such as Earth's Best and Sensible Portions.
Analysts also raised WhiteWave's price target to $39 from $35, citing expected M&A activity.
** MCDONALD'S CORP, $91.27, -1.33 pct
McDonald's reported a fall in sales at established restaurants across all regions in August, the fifth such monthly drop since CEO Don Thompson took the helm in July 2012.
** CHIMERIX INC, $29.45, +15.35 pct
New data suggested that the drug developer's experimental drug, brincidofovir, has a potentially favorable resistance profile to treat adenovirus and cytomegalovirus infections.
Cytomegalovirus and adenovirus can fatally infect persons with weak immune systems. The data on the drug, code named CMX001, was from in-vitro and mid-stage studies.
Cantor Fitzgerald initiated coverage of the company with a "buy" rating and $33 price target. The brokerage sees revenue of $1.9 billion for brincidofovir in 2025.
** FUELCELL ENERGY INC, $2.52, -5.62 pct
The fuel cell maker's third-quarter loss to common shareholders increased to $7.8 million from $6.4 million a year ago, hurt by higher operating costs. The company's revenue declined nearly 20 percent to $43.2 million.
** ENDOCYTE INC, $8.05, +17.18 pct
Cantor Fitzgerald on Monday initiated coverage on the drug developer's stock with "buy" rating and $21 price target. The brokerage cited the market opportunity for Endocyte's experimental cancer drug, code named EC1456, for the initiation.
** BARNES & NOBLE INC, $24.32, +3.93 pct
The U.S. bookstore chain reported a smaller-than-expected fall in quarterly same-store sales as promotions and new products drove up traffic at its stores.
** LOCKHEED MARTIN CORP, $175.68, +0.52 pct
** ALLIANT TECHSYSTEMS INC, $130.21, +3.00 pct
CNBC's Jim Cramer said investors should buy defense stocks on his show, Mad Money. (reut.rs/1onsGwF)
"With the new mess in the Middle East, not to mention the dramatic rise in tensions with Russia, our military spending is going to have to start increasing again," Cramer said. Most defense contractors have lagged the market this year and are much cheaper than the average stock on the S&P 500 index, Cramer said.
** TITAN MACHINERY INC, $12.76, -3.04 pct
The heavy equipment retailer cut its revenue and adjusted earnings forecasts for the full-year ending Jan. 31. The company also reported a second-quarter loss, which it blamed on lower projected net farm income and lower corn and soybean prices for a fall in spending on equipment. The company said its international business took a hit due to flooding in Serbia and Bulgaria and geopolitical turmoil in Ukraine.
** ROCKET FUEL INC, $15.5, -3.37 pct
The web-based video advertising provider said on Monday that CFO Peter Bardwick had resigned.
BMO Capital Markets on Tuesday cut its price target on the company's stock to $17 from $25. The brokerage said an earlier-than-expected close of [x+1] acquisition could lead to a revenue loss of $3 million-$4 million for the company in the September quarter.
** PEP BOYS-MANNY MOE AND JACK, $10.423, -8.65 pct
The auto parts retailer reported a second-quarter loss of $273,000, compared with a year-ago profit of $5.4 million, hurt by fall in comparable merchandise sales.
** MERRIMACK PHARMACEUTICALS INC, $7.011, +2.05 pct
Brokerage Cantor Fitzgerald began covering the cancer drug developer with a "buy" rating. Analyst Daniel Brims said he expects Merrimack to launch its pancreatic cancer drug next year and rake in global peak sales of $800 million in 2025. Brims has a price target of $16 on the stock.
Up to Monday's close, the stock had gained about 56 percent since May, when the company said its lead drug, MM-398, improved overall survival rates in metastatic pancreatic cancer patients when used as a combination therapy.
** HOME DEPOT INC, $89.68, -1.26 pct
Home Depot confirmed on Monday that its payment security systems had been breached, a data theft analysts warn could rival Target Corp's massive breach last year.
** MOBILEYE NV, $57.65, +8.75 pct
Morgan Stanley raised its price target on the driver-assistance system maker's stock to $65 from $46. The brokerage's price target implies a potential valuation of $14 billion - nearly three times the IPO valuation of $5.3 billion.
"Mobileye's superior technology and early start in the vision space mean that it has a 5-10 year lead over rivals today ... How quickly and how high MBLY can build that defensive wall around its business in the next 12-18 months will determine how high the stock goes from here," analysts said.
The company's driver assistance systems are used in 237 car models to detect other vehicles and objects using a camera and related software.
** MORGAN STANLEY, $34.25, -1.75 pct
The Wall Street bank has agreed to pay $95 million to resolve a lawsuit accusing it of misleading investors in mortgage-backed securities in the run up to the 2008 financial crisis.
** FRANCESCA'S HOLDINGS CORP, $13.455, -3.69 pct
The apparel and accessories maker's stock has lost a third of its value this year as the company discounts to clear off an inventory pile-up. The company reported lower-than-expected second-quarter sales and profit, hurt by low demand for jewelry, the company's second-largest business by sales, and higher discounts to clear inventory.
The company cut it fiscal 2015 profit forecast, while its total inventory spiked by 23 percent in the quarter.
** BGC PARTNERS INC, $7.63, +2.97 pct
** GFI GROUP INC, $5.7, +13.32 pct
BGC Partners is likely to make a $675 million all-cash unsolicited offer for derivatives broker and rival GFI Group in a bid to bolster its business, the Wall Street Journal reported, citing people familiar with the matter.
** PINNACLE FOODS INC, $32.19, -4.05 pct
The packaged food company's stockholders, consisting mostly of affiliates of Blackstone Group, are expected sell 15 million shares in a secondary public offering.
Blackstone held 59.97 million Pinnacle shares, or 51.14 percent, as of June 30, making it the largest shareholder.
** ENCANA CORP, $23.06, +2.49 pct
Canada's largest natural gas producer will sell its remaining stake in PrairieSky Royalty Ltd, the company it spun out to investors in May, in a C$2.6 billion ($2.37 billion) deal as it continues to raise funds to increase oil production.
** CTI BIOPHARMA CORP, $2.61, +5.24 pct
Piper Jaffray initiated coverage of the blood cancer drug developer's stock with an "overweight" rating and price target of $6.
"We believe Phase III data (early 2015) for lead candidate Pacritinib in myelofibrosis (MF) may broaden the utility of JAK inhibitors to patients with low platelet counts," analyst Charles Duncan said. JAK inhibitors are a class of drugs that block enzymes believed to be involved in the inflammatory process. The company's other drug, Pixuvri, is sold in Europe to treat aggressive B-cell non-Hodgkins lymphoma. "Pixuvri should report Phase III data mid-'15 which may enable an NDA (marketing application) filing in the U.S. and upside to current estimates," Duncan said.
** RPM INTERNATIONAL INC, $46.25, -2.26 pct
The specialty chemicals maker estimated first-quarter profit in line with year ago - below what analysts expected.
The company said last year's results were boosted by product launches from acquisitions. (Reporting By Shubhankar Chakravorty in Bangalore; Editing by Simon Jennings)