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Spain Kick Starts 2013 Funding with Euro Bond Sale

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Spain sold around 4 billion euros worth of bonds at one of the auctions on Thursday, which pretty much kick-started the country’s funding program meant for a tough 2013, during which, Madrid must reform the needs of regional debt while it struggles to meet the targets of deficit. The Treasury pinned down the top most of target of around 2.5 to 3.5 billion euros at slightly down borrowing costs compared to previous outings from the same document but it is still too high to feel comfortable.

Average yield on 2012 bond as recorded was 5.517%, compared to around 5.6% for benchmark 10 year on secondary market, far away from more than 7% levels in the month of July. Nick Stamenkovic, one of the bond strategists from RIA Capital Markets said that it was clearly reflecting that Spanish sentiment had marginally improved.

He explained that Spain has already been funded for the year 2012 and market is sure that early in 2013 the country will ask for bailout funds when they are forced to encounter issuance wall. Madrid currently is facing around 28 billion euros of debt related redemptions in the month of January and in the year 2013 its funding needs will increase from 186 billion euros in this year to 207 billion euros.

This amount could still go higher if the country overshoots the 6.3% of deficit target in the current year and 4.5% in next year, which was warned as a possibility by the Bank of Spain on last Wednesday. Spain sold bonds worth 3.6 billion euros that were maturing Oct 31st, 2015, bonds worth 645 million euros that were maturing on July 30th, 2017, and bonds worth 1.5 billion euros that were maturing April 30th, 2021.

Concerned about welfare system slipping into the deficit in this year, from a pretty balanced target of budget, the ministry of economy said that the reserve fund of social security will get 3.3 billion euros worth of 5-year sovereign bond.

Madrid is expected to aid the regional governments that are struggling, cut out of the debt markets that could further add to its bill a sum of 40 billion euros. The country’s economy is said to be recession hit since one year, the second one since 2009, and isn’t expected to grow up until late 2013. Around 25% of workers in Spain are without job and tax relief, and spending cuts have resulted in many violent protests throughout the country.

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Business

Top 3 Gainers: Zynga (NASDAQ:ZNGA), Eros International (NYSE:EROS), Borqs Technologies’ (BRQS)

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Zynga (NASDAQ:ZNGA) is up 2.5% after Benchmark reiterated its Buy rating in a look-ahead at Q2 earnings. The firm’s expecting a beat and solid guidance for Q3, and it’s raising its guidance for the fiscal year.

Tailwinds from the pandemic won’t dissipate easily, Benchmark suggests, and the videogame maker’s acquisition of Peak (and with it new “forever franchises” in Toon Blast and Toy Blast) will drive audience, bookings, margins and free cash flow, it says. The firm has an $11 price target, now implying 14% upside.

Eros International (NYSE:EROS) is up 5.8% today, making up the last week’s lost ground, after news that its streaming service Eros Now is partnering with Sony India (SNE +2.3%).

That will mean Eros Now’s app is pre-installed on selected Sony smart televisions in India, along with availability on a large base of existing models (Bravia E series and newer).

The country over the past year has seen a 25% growth in demand for smart TVs, fueled by overall industry growth of 15%, to a record 15M units/year.

Borqs Technologies’ (BRQS) personal safety tracker sees strong market with increased orders from the electronics retail chain in the US.

The boost in product demand comes ahead coronavirus pandemic that provides company to expect delivery of 250K units this year. It reflects over 3x the volume delivered in 2019, the year of its launch.

Borqs’ mobile personal safety devices designed particularly for senior citizens come with panic button, location tracking, and fall detection.

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Biotech

Biotech movers: Pfizer Inc. (PFE), Celgene Corporation (CELG)

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Pfizer Inc. (PFE) said on Thursday it received a request for documents as part of a U.S. investigation related to quality issues involving the manufacture of auto-injectors at its Meridian Medical Technologies site.

Pfizer, in a regulatory filing, said it would be producing records in response to the civil investigative demand from the U.S. Attorney’s office for the Southern District of New York.

Why ASDN Could Massively Outperform PFE in 2019

Meridian, a unit of Pfizer that manufactures EpiPen injectors used to deliver an emergency allergy antidote, has been hit by a series of manufacturing problems in recent years. Mylan NV, which markets EpiPens, has recalled tens of thousands of the devices after complaints that some had failed to activate.

Bristol-Myers Squibb has been meeting with shareholders in Boston and New York over the last two weeks to try to salvage its $74 billion purchase of cancer drugmaker Celgene Corporation (CELG), the biggest acquisition announced so far this year.

Why Investors Are Calling ASDN the CELG of the Sky!

The deal, announced in January, was hard sell to Bristol shareholders from the start. The acquisition adds about $32 billion in fresh debt to Bristol’s balance sheet while assuming $20 billion in Celgene’s debt, the companies said at the time. After factoring in debt, the acquisition was the largest health-care deal on record, according to data compiled by Refinitiv.

Now, hedge funds Wellington Management and Starboard Value say the deal doesn’t sit well with them. Bristol has sent executives to New York to meet with institutional investors several times over the last two weeks and met with investors in Boston on Wednesday and Thursday, according to a person who briefed on the meetings.

Bristol-Myers declined to comment.

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Biotech

Big Losers: Corbus Pharmaceuticals Holdings, Inc. (CRBP), Petróleo Brasileiro S.A. – Petrobras (PBR)

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Corbus Pharmaceuticals Holdings, Inc. (CRBP)’s shares slumped as much as 16% to $6.94 on huge volume. The stock has been showing intense sell off suddenly after a bearish article on seekingalph.com by Alpha Exposure.

The article stated that Corbus has ties to investors convicted of or alleged to have committed securities fraud. We believe lenabasum has failed its major trials in SSc and CF. Lenabasum was also denied Breakthrough Therapy Designation in SSc. We believe lenabasum will fail in its pivotal SSc and Phase 2b CF trials. We are short Corbus with a price target of $0.50.

Wow the future of Autonomous flight is finally here with the launch of ASDN passenger drone Elroy

Petróleo Brasileiro S.A. – Petrobras (PBR) is expanding its ambitious divestment program and has “bold” plans for sales, the Brazilian state-run oil company’s chief executive said after the firm posted its first annual profit in five years.

On a conference call with analysts to discuss fourth-quarter results, CEO Roberto Castello Branco said selling non-core assets will be key to deleveraging.

Petrobras, as the company is known, can reduce its ratio of net debt to earnings before interest, taxes, depreciation and amortization, or EBITDA, to 1.5 or even to 1, he added.

The University of Chicago-educated CEO, who took the reins in early January, has long been vocal about the need to slim down the sprawling firm and focus on core activities such as exploration and production. Thursday’s comments were some of his most assertive on the matter.

Why Investors Are Calling ASDN the TPC of the Sky!

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