Teva Bids Adieu to CEO, Gives Back October Gains

So Teva Pharmaceuticals (TEVA), how did that work out for you? That, of course, being the decision to part ways with CEO Jeremy Levin.

Teva’s decision to look for a new CEO has had a drastic effect on the maker of generic drugs. At yesterday’s close, Teva had been up 9% in October. After today’s plunge, Teva’s stock is up just 0.3% this month.

Citigroup’s Liav Abraham and team still see value in Teva’s shares. They write:

We acknowledge that the Teva investment thesis will likely be a "show me" story over the near term, as the company and its Board demonstrates to investors that (i) the company's long-term strategy for value creation remains intact; and (ii) Dr. Levin's departure does not prompt the departure of other members of the company's senior leadership team, many of whom joined the company over the past couple of years. Our thesis surrounding the attractive risk-reward profile of the company remains intact; however investors are likely to be skeptical surrounding management's ability to unlock value over the near term.

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S&P Capital IQ’s Herman Saftlas, however, sees the resignation as a sign of Teva’s dysfunction. He writes:

We are disappointed by the abrupt departure of Jeremy Levin as CEO of Teva after holding that position for less than 18 months, with Eyal Desheh named interim CEO. We believe the split reflects a fundamental difference between Mr. Levin and Teva’s Board on how to deal will several headwinds facing Teva, most notably impending generic erosion and increased competition in its key Copaxone multiple sclerosis franchise (which we believe accounts for close to one third of Teva’s gross profits).

Teva has dropped 7.7% to $37.85 today at 3:23 p.m. but doesn’t seem to be spreading though the generic drug space. Taro Pharmaceuticals (TARO) ha gained 1.1% to $79, while Actavis (ACT) has gained 1.2% to $156.25 and Dr. Reddy’s Laboratories (RDY) has advanced 1% to $40.24. Mylan (MYL) has dropped 0.7% to $38.40.

Shutdown, Schmutdown: Midwest Business Activity Surges

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Daniel Acker/Bloomberg via Getty Images WASHINGTON -- Business activity in the U.S. Midwest surged past expectations in October as new orders hit their highest level since 2004, countering recent evidence of soft economic growth. Weekly unemployment claims also fell, in welcome news for the nation's battered labor market after the impact of a government shutdown on furloughed federal workers diminished. The Institute for Supply Management-Chicago business barometer jumped to 65.9 from 55.7, the strongest reading since March 2011 and well above the most optimistic forecast in a Reuters poll. Initial claims for state unemployment benefits dropped by 10,000 to a seasonally adjusted 340,000, the Labor Department said on Thursday. The U.S. job market has apparently slackened in recent months, with private-sector employers hiring fewer workers in October after uncertainty caused by budget brinkmanship in Washington dented confidence among both consumers and businesses. Given that backdrop, analysts treated the ISM-Chicago numbers with some skepticism. "The report may be exaggerating the extent of economic growth momentum," said Millan Mulraine, director of research at TD Securities (TD). Financial markets showed little reaction to the figures, with stocks lower on investor caution following recent record highs. Treasury bonds were also down modestly. Other recent data on hiring, factory output and home sales in September have suggested the economy lost a step even before the government shut down. Readings on consumer confidence this month have shown the fiscal standoff rattled households. Anxious to maintain policy support while the economy works through this soft spot, the U.S. Federal Reserve on Wednesday extended its asset purchase campaign at a policy meeting that opted to keep buying bonds at a $85 billion monthly pace. A 16-day partial shutdown of the federal government had pushed up claims in recent weeks as furloughed workers applied for benefits, but this factor appeared to be diminishing. Claims filed by federal employees dropped 29,713 in the week ended Oct. 19 to 14,423. The shutdown ended Oct. 17. In addition, a Labor Department analyst said California, which had been dealing with a backlog, reported no carryover in claims last week from previous weeks. Technical problems as California converted to a new computer system have distorted the claims data since September, which had made it hard to get a clear read of labor market conditions. The four-week moving average for new claims, considered a better measure of labor market trends, increased 8,000 to 356,250. Federal Reserve officials are closely focused on improvements in the labor market, which they have made a condition for tapering their massive bond buying program, while stressing they will wait a considerable period before beginning to raise interest rates after asset purchases have halted. Markets have pushed out their expectations for a rate hike to June 2015, when the chance of a move was priced at 60 percent. Earlier this week, the Fed funds futures contract had signaled a 52 percent chance of a hike in April 2015. The government will publish October's employment report on Nov. 8. Payrolls gained 148,000 in September, with the unemployment rate hitting a near five-year low of 7.2 percent. But if average monthly jobs growth continues at less than 150,000, where it has been over the last three months, that would make it difficult for the jobless rate to fall further.

Time to Switch Gears With SolarCity (SCTY)

It's not going to be a popular idea, but if you were lucky enough to get into a SolarCity Corp. (NASDAQ:SCTY) position at any time between October 10th and Thursday of last week, then congratulations. Now get out. Although you're up anywhere between 8.0% and 52%, SCTY is overdue for a pullback, and there are some hints that today's the day that sizeable pullback is beginning.

If the company name and ticker rings a bell, it might be because yours truly took an honest, unbiased trading look at it back on the 11th. The conclusion then? While SCTY looked like it was bullish enough to make for a great short-term trade, that rally was never going to be built to last. Here we are ten days later, and sure enough, it looks like the SolarCity runup is done, and reversing today.

There are two clues that point to that outcome here. One of them is the fact that even though SolarCity Corp. has been running hard for nearly a couple of weeks now, the buying volume has been drifting lower that whole time. It's going to need growing participation rather than fading participation if the strength is going to keep chugging.

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The other clue is today's bar, which actually opened at a new multi-month high, and then faded back into the red. Think of it as a "last hurrah" of sorts, where the last of any would-be buyers file in, but the first of the profit-takers are immediately ready and willing to start filing out. The irony of that event is that the more the SCTY bear/bull balance dips to the bearish side of the fence, the heavier the bearish weight gets as fewer buyers remain interested in catching a falling knife, and as more and more traders become profit-takers, not wanting to give up any more ground than they already have.

You'll also notice the volume behind today's pullback from SolarCity is pretty heavier... heavier than the volume we've seem for most of the last few bullish days. Point being, the bull/bear imbalance may well already be tipped in favor of the bears.

Suggesting anything less than perpetual and perfect bullishness is in the cards for SCTY won't be any less popular today than it was a week and a half ago. But, this was always the inevitable reality. The good news for fans of SolarCity Inc. is, this pullback isn't apt to last any longer than the overheated runup was. Timing is still everything.

If you'd like to get more trading ideas and insights like this one, sign up for the free SmallCap Network daily e-newsletter. It's full of stock picks, market calls, and more.

Top Portfolio Products: ProShares Rolls Out Emerging Market Bond ETF; China Gets S&P 500-Based ETF

New products and changes introduced over the last week include a short-term emerging markets bond ETF from ProShares; an S&P 500-based ETF in China; and an annuity from Allianz Life with a 7-year decreasing surrender charge.  

In addition, W.E, Donoghue launched a power dividend index fund; American Century offered a retirement plan assessment tool; and Franklin Templeton and K2 Advisors announced a multi-strategy fund.

Here are the latest developments of interest to advisors:

1) ProShares Launches Short-Term Emerging Market Bond ETF

Proshares announced Thursday the launch of the Short Term USD Emerging Markets Bond ETF (EMSH), which is designed to offer yield potential with reduced interest rate sensitivity.

EMSH tracks the DBIQ Short Duration Emerging Market Bond Index, which is composed of a diversified portfolio of U.S. dollar-denominated emerging markets bonds with a weighted average maturity of three years or less. The index currently includes bonds from 19 countries issued by sovereign governments, other government entities and agencies, as well as corporations that have significant government ownership. A country’s weight in the index is capped at 10%. Bonds must have a minimum $500 million outstanding issuance to be eligible.

2) S&P 500-Based ETF Launched in China

Through a licensing agreement with S&P Dow Jones Indices, Bosera Asset Management has launched an S&P 500-based ETF in China, a move that allows the Chinese greater access to the U.S. market.

Total assets under management of ETFs listed in mainland China (Shanghai and Shenzhen) topped 150 billion yuan (about USD $25 billion) in Q3 2013 with close to 80 ETFs available in the market. The new ETF is the first to track the S&P 500.

3) Allianz Life Announces Annuity With 7-Year Decreasing Surrender Charge

Allianz Life has announced the launch of the Allianz Signature 7 annuity, available on the Allianz Preferred platform. The annuity is designed for retirement accumulation with a seven-year decreasing surrender charge period and is currently available in 41 states.

Prior to retirement, the annuity allows customers to accumulate retirement savings through indexed interest based on changes in several external market indexes of their choice. When they are ready for retirement, customers can access income with annuity income options including payments guaranteed for the life of the customer. Or, the full contract value is available to customers as a lump sum without surrender charges after seven contract years.

4) W.E. Donoghue Introduces Power Dividend Index Fund

W.E. Donoghue & Co. introduced its Power Dividend Index Fund (A shares, PWDAX; I shares, PWDIX) on Tuesday. The fund uses the firm’s proprietary Power Dividend Index to seek to generate income while deploying a tactical overlay in an effort to preserve capital in all market cycles. The index isolates the top five dividend-yielding stocks in each of the 10 global industry classification standard (GICS) sectors—consumer discretionary, consumer staples, energy, financial services, healthcare, industrials, materials, utilities, telecommunication services and information technology—that comprise the S&P 500 Index.

Those 50 stocks make up the S-Network Sector Dividend Dogs Index, and are equally weighted in the fund’s portfolio. The fund will sell positions in stocks that are removed from the S&P 500. An intermediate-term tactical overlay positions the fund bearishly or bullishly, depending on market developments and outlooks, and allows it to be invested in money market funds and other cash equivalents during equity market downturns.

5) American Century Offers Retirement Plan Assessment Tool

American Century Investments has announced the launch of a new tool aimed at helping retirement plan advisors and sponsors assess plan effectiveness for better participant outcomes. Plan Health Pro is an online resource designed to help determine overall retirement plan health. Using a series of questions and answers, the plan is evaluated for plan health, retirement readiness and due diligence.

The tool takes into consideration aspects such as plan objectives, plan design, participant communications and investments. Once the plan sponsor or advisor completes the questionnaire, the result is a personalized report, including a green, yellow and red scorecard on a plan's effectiveness and suggested areas of improvement. The report may serve as historical documentation of a plan’s progress to helping participants achieve retirement readiness. A demo is available at www.planhealthpro.com.

6) Franklin Templeton and K2 Advisors Announce Multistrategy Fund

Franklin Templeton Investments has announced the launch of its first multimanager, multistrategy mutual fund focused on alternative investment strategies, Franklin K2 Alternative Strategies Fund (FAAAX). FAAAX seeks to provide investors with lower correlations to traditional asset classes, reduced portfolio volatility and risk-adjusted returns, while offering daily liquidity.

K2 Advisors is the fund’s investment manager. FAAAX provides access to a diversified portfolio of alternative investment strategies and to a group of unaffiliated, institutional-quality hedge fund managers. The  initial set of subadvisors includes: Basso Capital Management, L.P.; Chatham Asset Management, LLC; Chilton Investment Company, Inc.; Impala Asset Management LLC; Jennison Associates LLC; Lazard Asset Management LLC; Loomis Sayles & Company, L.P.; P. Schoenfeld Asset Management LLC; and York Capital Management L.P.

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Read the Nov. 15 Portfolio Products Roundup at ThinkAdvisor.

First Take: Wall Street holds back Yahoo cheers

SAN FRANCISCO — Yahoo CEO Marissa Mayer has performed a miraculous company culture shift and overhaul of services but a makeover of its advertising business remains to be seen.

Wall Street will have to continue its wait. Yahoo on Tuesday reported third-quarter results that gave little to cheer in that regard. Adjusted display ad revenue slid 7%, to $421 million, from a year ago. Search revenue edged up 3%, at $426 million, on an adjusted basis.

Yahoo shares closed 1.8% lower, at $33.88, in regular trading and remained flat in after hours.

"Signs of a fundamental turnaround at Yahoo would begin with a recovery in its user engagement levels. And so far, there isn't evidence of this," said Mark Mahaney, analyst with RBC Capital Markets, ahead of Yahoo's report.

Analysts expect Yahoo's share of the U.S. display advertising market to shrink to 7.5% in 2013, down from 9.2% last year, according to eMarketer. Google is expected to increase its position to 17.4%, up from 15.3% last year. Facebook's share is expected to surge to 17% this year, up from 14.8% last year.

Yahoo's stock pop under Mayer — it has more than doubled — is largely attributed to its holdings in Alibaba. The Chinese e-commerce giant is expected to go public and could command an $80 billion valuation. That would make Yahoo's 24% stake worth roughly $19 billion.

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Mayer is the sixth CEO in six years at Yahoo. The troubled Internet pioneer's top spot had become a revolving door of those unable to correct its course in a losing advertising battle against Google and Facebook. Twitter is expected to nearly double its advertising revenue by next year, posing another challenger.

Yahoo reported net income of $296 million, or 28 cents per share, on revenue of $1.08 billion.

Analysts expected Yahoo to report third-quarter net income of $356.5 million, or 33 cents per sha! re, on revenue of $1.08 billion, according to the survey of estimates from Thomson Reuters. That's a decline from net income of $420.7 million, or 35 cents a share, on revenue of $1.09 billion in the same period a year ago.

New Jobless Claims Rise as Government Shuts Down

New claims for unemployment benefits jumped 66,000 in the week ending last Saturday, according to the weekly report from the U.S. Department of Labor. The total rose to 374,000 from a prior week total of 308,000. Economists were expecting a rise to 310,000.

A recalcitrant computer system in California gets much of the blame. The system is responsible for delays in processing claims that were filed in previous weeks and are just showing up now. Basically that means the numbers are quite unreliable, but they are the best we have.

The report does not include federal government employees who have been furloughed as a result of the government shutdown. Federal employees file for jobless benefits under a separate program and are not included in the Labor Department’s weekly report.

The average of new claims for the past four weeks rose from 305,000 to 325,000, but continuing claims dropped by 16,000, from 2.921 million to 2.905 million.

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Going into the federal government shutdown that began on October 1, new jobless claims were at or near their lowest point since the U.S. economic recovery began.

An Introduction To Structured Products

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Once upon a time, the retail investment world was a quiet, rather pleasant place where a small, distinguished cadre of trustees and asset managers devised prudent portfolios for their well-heeled clients within a narrowly defined range of high-quality debt and equity instruments. Financial innovation and the rise of the investor class changed all that.

One innovation that has gained traction as an addition to retail and institutional portfolios is the investment class broadly known as structured products. Structured products offer retail investors easy access to derivatives. This article provides an introduction to structured products with a particular focus on their applicability in diversified retail portfolios.

What Are Structured Products?
Structured products are designed to facilitate highly customized risk-return objectives. This is accomplished by taking a traditional security, such as a conventional investment-grade bond, and replacing the usual payment features (e.g. periodic coupons and final principal) with non-traditional payoffs derived not from the issuer's own cash flow, but from the performance of one or more underlying assets.

The payoffs from these performance outcomes are contingent in the sense that if the underlying assets return "x," then the structured product pays out "y." This means that structured products closely relate to traditional models of option pricing, though they may also contain other derivative types such as swaps, forwards and futures, as well as embedded features such as leveraged upside participation or downside buffers.

Structured products originally became popular in Europe and have gained currency in the U.S., where they are frequently offered as SEC-registered products, which means they are accessible to retail investors in the same way as stocks, bonds, exchange traded funds (ETFs) and mutual funds. Their ability to offer customized exposure, including to otherwise hard-to-reach asset classes and subclasses, makes structured products useful as a complement to these other traditional components of diversified portfolios.

Looking Under the Hood
Consider the following simple example: A well-known bank issues structured products in the form of notes, each with a notional face value of $1,000. Each note is actually a package consisting of two components - a zero-coupon bond and a call option on an underlying equity instrument, such as a common stock or perhaps an ETF mimicking a popular stock index like the S&P 500. Maturity is in three years. Figure 1 represents what happens between issue and maturity date.

Figure 1

Although the pricing behind this is complex, the principle is fairly simple. On the issue date you pay the face amount of $1,000. This note is fully principal-protected, meaning that you will get your $1,000 back at maturity no matter what happens to the underlying asset. This is accomplished via the zero-coupon bond accreting from its original issue discount to face value.

For the performance component, the underlying asset, priced as a European call option, will have intrinsic value at maturity if its value on that date is higher than its value when issued. You earn that return on a one-for-one basis. If not, the option expires worthless and you get nothing in excess of your $1,000 return of principal.

Custom Sizing
In the example above, one of the key features is principal protection. In another instance, an investor may be willing to trade off some or all of this protection in favor of more attractive performance features. Consider another case. Here, an investor trades the principal protection feature for a combination of performance features.

If the return on the underlying asset (R asset) is positive - between zero and 7.5% - the investor will earn double the return (e.g. 15% if the asset returns 7.5%). If R asset is greater than 7.5%, the investor's return will be capped at 15%. If the asset's return is negative, the investor participates one-for-one on the downside (i.e. no negative leverage). There is no principal protection. Figure 2 shows the option payoff chart for this scenario.

Figure 2

This strategy would be consistent with a mildly bullish investor's view - one who expects positive but generally weak performance and is looking for an enhanced return above what he or she thinks the market will produce.

Over the Rainbow
One of the principle attractions of structured products for retail investors is the ability to customize a variety of assumptions into one instrument. For example, a rainbow note is one that offers exposure to more than one underlying asset. A lookback is another popular feature. In a lookback instrument, the value of the underlying asset is based not on its final value at expiration, but on an average of values taken over the note's term, for example monthly or quarterly. In the options world, this is also called an Asian option to distinguish it from the European or American option. Combining these types of features can provide attractive diversification properties.

A rainbow note could derive performance value from three relatively low-correlated assets; for example, the Russell 3000 Index of U.S. stocks, the MSCI Pacific ex-Japan index and the Dow-AIG commodity futures index. Attaching a lookback feature to this could further lower volatility by "smoothing" returns over time.

What About Liquidity?
One common risk associated with structured products is a relative lack of liquidity due to the highly customized nature of the investment. Moreover, the full extent of returns from the complex performance features is often not realized until maturity. Because of this, structured products tend to be more of a buy-and-hold investment decision rather than a means of getting in and out of a position with speed and efficiency.

A significant innovation to improve liquidity in certain types of structured products comes in the form of exchange-traded notes (ETNs), a product originally introduced by Barclays Bank on June 12, 2006. These are structured to resemble ETFs, which are fungible instruments traded like regular common stock on a securities exchange. ETNs are different from ETFs, however, as they consist of a debt instrument with cash flows derived from the performance of an underlying asset - in other words, a structured product. ETNs can provide access to hard-to-reach exposures, such as commodity futures and the Indian stock market.

Other Risks and Considerations
In addition to liquidity, one risk associated with structured products is the issuer's credit quality. Although the cash flows are derived from other sources, the products themselves are legally considered to be the issuing financial institution's liabilities. They are typically not, for example, issued through bankruptcy-remote third-party vehicles in the way that asset-backed securities are. The vast majority of structured products are from high investment-grade issuers only - mostly large global financial institutions such as Barclays, Deutsche Bank or J.P. Morgan Chase. However, during a financial crisis, some structured products have the potential of losing principals to investors, similar to the risks involved with options. For that matter, the U.S. Financial Industry Regulatory Authority (FINRA) suggests that firms "consider" whether purchasers of some or all structured products be required to go through a similar approval process, so that only accounts approved for options trading would also be approved for some or all structured products.

Another consideration is pricing transparency. There is no uniform standard for pricing, making it harder to compare the net-of-pricing attractiveness of alternative structured product offerings than it is, for instance, to compare the net expense ratios of different mutual funds or commissions among broker-dealers. Many structured product issuers work the pricing into their option models so that there is no explicit fee or other expense to the investor. On the flip side, this means that the investor can't know for sure what the implicit costs are.

Conclusions
The complexity of derivative securities has long kept them out of meaningful representation in traditional retail (and many institutional) investment portfolios. Structured products can bring many of the benefits of derivatives to investors who otherwise would not have access to them. As a complement to more traditional investment vehicles, structured products have a useful role to play in modern portfolio management.

Staples Completes Acquisition of Online Retail Sales Software Provider (SPLS)

Early on Wednesday, office supplies retailer Staples, Inc. (SPLS) announced that it has completed the acquisition of Runa, a San Mateo, California-based software company. Terms of the deal were not disclosed.

Runa provides software that helps online retailers increase sales by personalizing shopping experience.

"Runa has a unique platform and outstanding talent with experience in e-commerce and online marketplaces," said Ronald Sargent, chief executive officer and chairman, Staples. "With Runa, we're adding technology to better serve our customers with personalized items, offers, and delivery estimates, all in real-time. Runa will allow us to tap into the wealth of engineering and e-commerce expertise in the Silicon Valley area."

Staples noted that this acquisition is just the latest step in the company’s quest to invest in e-commerce capabilities at a time when its brick and mortar stores struggle to increase traffic. Runa’s facility in San Mateo will serve as the newest Staples Lab, following locations in Seattle and Cambridge.

Staples shares were inactive during pre-market trading on Wednesday. The stock is up 29.82% year-to-date.

What You Need To Know About The Employment Report

At 8:30 a.m. EST on the first Friday of every month, the U.S. Department of Labor's Bureau of Labor Statistics releases the Employment Situation Summary, otherwise known as the Employment or Jobs Report. Based on the Current Populations Survey, which surveys households, and the Current Employment Statistics Survey, which surveys employers, the report estimates the number of people employed and unemployed, the number of hours being worked and a myriad of other related facts and figures. Its information is widely anticipated, forecasted and used by Wall Street firms, their economists and many business decision-makers. It may even impact broader public and corporate confidence, and therefore future business and hiring decisions.

What the Report Doesn't Say
The report is scrutinized for what it has to say about the state of the economy. The number of jobs being created can signify whether an economy is improving, overheating or waning. Unfortunately, since the numbers often get significant revisions long after their initial release, the Employment Report is not so much predictive as it is a confirmation of economic conditions. Also, the numbers can have unexpected swings from month to month with predictions being way off target for many months in a row.

For example, in a post-recession scenario, new jobs created might come in far below what economists were forecasting. Then there might finally be a month in which three times as many jobs as expected show up, causing the Federal Reserve to raise interest rates. The next month, however, the report could bring in terribly low numbers, and the information from the business and household surveys could be increasingly divergent, compounding economists' exasperation over the report's lack of predictability.

Uncertainty aside, in relation to other employment and economy-related indicators, the Employment Report does provide worthwhile information. In particular, unexpected results often indicate that something unusual is going on with the economy and employment.

Who Uses the Employment Report?
The currency market is the most driven by the Employment Report. This was shown in a 1995 study by the Federal Reserve Bank of New York, which noted several ways in which employment data impacted the currency market. An unanticipated rise in employment, for example, means a rise in the U.S. dollar. The study also reported that reactions to surprises relate to the implications on short-term interest rates. The currency market has become increasingly sensitive to the data and pays particular attention to the establishment survey.

But interest in the Employment Report doesn't stop there. The bond market is concerned with what the report may indicate about inflation and interest rates. A strong employment report may indicate an economy that is heating up too quickly, leading economists and traders to become concerned about inflationary pressure. However, it can also raise concerns about tighter monetary policy and forthcoming interest rate increases. The equity market looks for rising employment as a sign of corporate optimism and growth potential. It is also concerned with inflation and interest rates, but to a lesser degree.

The Surveys
The names of the two employment surveys indicate the facets of the population that they cover. The household survey interviews 60,000 households, while the establishment survey gathers data from 160,000 businesses and government agencies covering 400,000 work sites, or about one-third of all payroll workers. While the Employment Report is released monthly, the surveys actually cover only a single week that includes the 12th day of the month.

Both surveys have their merits and drawbacks. The household survey includes just about every kind of employed person, including self-employed persons, agricultural workers and even those who work in the home raising a family. The establishment survey includes only employees of companies that provide payroll counts. So even though its survey sample is large, the establishment survey misses a significant demographic and can misrepresent the employment rate when the number of self-employed persons hits extremes. The household survey, however, covers only 60,000 people and is often criticized for being volatile due to the relatively small sample size.

The Business Cycle
The number of self-employed persons can fluctuate significantly throughout the business cycle. Recession, layoffs and tight labor markets can drive many people to go into business for themselves. Many skilled laborers become consultants, and it's common for people to consult for their former employers. These people are often unaccounted for in the establishment survey, and a growth in the number of consultants tends to exaggerate the unemployment rate.

Conversely, when the economy begins to accelerate and companies start hiring again, many self-employed persons decide to go back on the payrolls for the steady paychecks and benefits. At such times, the divergence between the household and establishment surveys could reverse.

Another factor that impacts the payroll survey and not the household survey is the employee turnover rate. Every time someone changes jobs within the reporting period, they are counted twice - once by each employer. This goes on all the time, so it shouldn't greatly influence the change in employment numbers from month to month. However, over longer periods the turnover rate can vary throughout the business cycle. One theory is that turnover slows during the early part of economic recovery because workers are sensitive to layoffs and therefore want job security.

Survey Components
Both the establishment and household surveys consist of several components that feed into the Employment Report:

The Household Survey:

Unemployment: The number of unemployed persons and the unemployment rate. Total Employment and the Labor Force: The total number of people employed and the proportion of the population age 16 and over that is working. Persons Not in the Labor Force: The number of persons marginally attached to the labor force. These are people who want to work and have sought employment in the past 12 months, but not in the past four weeks. They are not counted as employed. This component also reports the number of discouraged workers who believe no work is available for them. The Establishment Survey:

Industry Payroll Employment: Total employment and specific employment sector statistics. Weekly Hours: The average workweek for production and non-supervisor-level employees, and the hours worked by those employed in manufacturing. Hourly and Weekly Earnings: The average hourly and average weekly earnings of production and non-supervisor-level employees. The Bottom Line
While the Employment Report might be volatile and subject to major revisions well after the fact, it remains a widely watched indicator of economic well-being. And the numbers it provides on employment influence the financial markets directly. The number of new jobs being created provides clues about the economy and corporate earnings, and indirectly provides insight on interest rates and currency prices.

Packaging Corp. Buys Boise for $1.3B

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NEW YORK (TheStreet) -- Packaging Corp. of America (PCA) (PKG) is buying packaging specialist Boise (BZ) in a deal worth almost $1.3 billion, pushing shares of both companies up in premarket trading on Monday.

Boise shares climbed 26.71% to $12.62 on news of the deal, which is expected to close in the fourth quarter. Shares of PCA rose 11.9% to $61.04.

PCA will pay $12.55 a share in cash for Boise's outstanding common shares. The total transaction value is $1.995 billion, although this includes $714 million of outstanding Boise debt.

"The acquisition is an excellent fit, both geographically and strategically, with unique and substantial synergies," said PCA Executive Chairman Paul Stecko, in a statement. "It provides the containerboard that PCA needs to support our strong corrugated products growth." PCA said that its containerboard capacity under the deal will increase to 3.7 million tons from the current level of 2.6 million. The acquisition will increase PCA's corrugated products volume by about 30%, it added, and expand the company's market presence into the Pacific Northwest --Written by James Rogers in New York. Follow @jamesjrogers >Contact by Email.

Dividend-Paying Gold Stocks are Very Alluring After Janet Yellen's Remarks

An important bit of business news on Thursday.

In testimony before the Senate Banking Committee, Dr. Janet Yellen, nominated to replace Federal Reserve Chairman Ben Bernanke, said she favors continuing Quantitative Easing III. That program has the Federal Reserve acquiring $85 billion monthly in Treasury securities and mortgage bonds through expanding its balance sheet, in an effort to keep interest rates low.

And this news now results in dividend-paying gold stocks, such as Yamana Gold (NYSE: AUY), Gold Fields (NYSE: GFI) and Newmont Mining (NYSE: NEM) being attractive as both short-term and long-term investments.

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In the short term, the dividend income stream from each makes the stock appealing in a low interest rate environment.

The dividend yield for Yamana Gold is 2.74 percent. For Newmont Mining, it is 2.85 percent. Gold Fields has a dividend yield of 3.04 percent. The average dividend for a member of the Standard & Poor's 500 Index is around 1.9 percent. Ten-year Treasury bonds now yield 2.69 percent.

Over the long term, these stocks are alluring -- as quantitative easing measures should result in inflation, which increases the value of gold assets.

Since 2007, the Federal Reserve balance sheet has expanded from around $700 billion to over $4 trillion. It is increasing at a rate of around $1 trillion yearly, thanks to Quantitative Easing III. Eventually the value of the U,S. dollar should fall from so many more greenbacks being created without the corresponding economic growth.

In an interview with The Wall Street Journal, former Secretary of the Treasury and Secretary of State George Shultz said it's "startling that in the last year, three-quarters of the debt that's been issued has been bought by the Fed and the balance has been bought by other countries, so U.S. citizens and institutions are not on net buying U.S. debt."

"The Fed," he continued, "doesn't have an unlimited capacity because when it buys the debt what it's doing is monetizing the debt. Sooner or later that has got to get out into the economy. Can't be held forever. And when it does in that kind of volume -- as Milton Friedman taught us, inflation is a monetary phenomenon -- it's gonna be hard to control."

In other words, inflation from this will reduce the value of the U.S. dollar and other fiat currencies while increasing the price of gold.

That is long overdue. After Ben Bernanke introduced Quantitative Easing II in August 2010, gold and silver assets rose in value on the exchange traded fund gold, SPDR Gold Shares (NYSE: GLD). It also sent the exchange traded fund for silver, iShares Silver Trust (NYSE: SLV), soaring.

Initially that also happened after Quantitative Easing III was announced in September 2012. But, due to the massive amounts of currencies being created by quantitative easing from central banks around the world, gold and silver markets were overwhelmed. From that, the price of gold and silver soon fell in favor of assets with more liquidity, such as oil.

This is easily seen in the share prices of Yamana, Gold Fields, and Newmont Mining.

For 2013, Yamana Gold is down more than 40 percent. Over the same period, Newmont Mining is off by over 35 percent. Since the first of the year, Gold Fields has fallen nearly 60 percent. Each has jumped in recent market action, however.

For shareholders, with Yellen continuing quantitative easing, the rises should be even more over the long term, with the dividends increasing the total return.

Posted-In: Gold gold mining Janet Yellen metals and miningBonds Long Ideas News Sector ETFs Commodities Treasuries Global Economics Federal Reserve Markets Trading Ideas ETFs Best of Benzinga

(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Tesla Plant Accident Not a Fire

What was first reported as a fire on Wednesday afternoon at the Tesla Motors Inc. (NASDAQ: TSLA) has now been explained by the company as a failure in a low-pressure aluminum casting press. Three Tesla employees were injured by hot metal from that press and the company said that it is making sure that they receive the "best possible care."

The report of a fire was apparently confirmed by the Fremont, California, fire department and was tweeted at 1:46 p.m. PT. Fire department equipment was dispatched to Tesla's factory.

Fire has got to be a pretty touchy subject around Tesla these days following three fires in the company's Model S sedans in the past six weeks. Three car fires may not be enough for an in-depth government investigation or a recall, however it would not take many more similar fires, or an actual injury, to force CEO Elon Musk to change his mind, or have it changed for him.

Not only does the public expect the cars to be flawless, but the hype surrounding the company leads us to believe that the company itself is without blemish. And just as a car with thousands of parts can never be flawless, neither can an automaker with thousands of employees.

Tesla stock did not move much in after-hours trading following the incident. The stock is up about 0.3% at $139.05 after closing at $138.70 in a 52-week range of $30.50 to $194.50.

Philanthropist still wants Philadelphia Inquirer

The dizzying world of rich business folks gaming for ownership of struggling newspapers continues. On Sunday, a 96-year-old multimillionaire and philanthropist said he wants to buy the 184-year old Philadelphia Inquirer.

The Inquirer reported on its own pages that Raymond Perelman, father of multibillionaire Revlon chairman Ron Perelman, wants to buy it along with the Philadelphia Daily News and Philly.com. It's the third time in as many years that Perelman has sought to buy the city's flagship paper, which is at the heart of a messy soap opera involving its six wealthy owners and newsroom management.

Perelman and officials of the union that represents newsroom and other employees say they're unlikely to sell to him though the union is seeking outside investors. The award-winning paper has had five owners in the past seven years and circulation and advertising revenue have plummeted.

Rem Rieder: Philly newspaper stars in ugly melodrama

"I'd like to buy them all out, but I don't think all of them will sell," Perelman said, in an interview published by the Inquirer.

Co-owners Lewis Katz and H.F. "Gerry" Lenfest recently filed suit against co-owner George E. Norcross and three other partners, seeking a court order to reverse their October firing of Inquirer editor William K. Marimow.

Uber-wealthy executives increasingly are showing up as the white knights eager to purchase -- if not save -- newspaper publishing companies struggling in a digital age. Billionaire and Amazon.com founder Jeff Bezos recently purchased the Washington Post Co., which publishes The Washington Post, for $250 million. Warren Buffet's Berkshire Hathaway over the past two years has acquired 28 local newspapers for $344 million. Over the summer, Boston Red Sox owner John Henry bought the Boston Globe for a reported $70 million.

Perelman heads privately held RGP Holdings, which includes manufacturing, mining and financial interests and is the only outsider to go public with an offer to invest! in the media properties. The Inquirer is the third-oldest surviving newspaper in the United States, dating back to the Civil War. It's received a number of Pulitzer Prizes -- the most recent in 2012, in public service for a series on violence in the city's public schools.

"Something has to happen," Perelman told the paper. "The feuding can't continue."

Contributing: The Associated Press

Apple’s Handheld TV, and All the Other Video Devices

How big does a  smartphone or tablet screen have to be before it can be considered a TV? Apple Inc. (NASDAQ: AAPL) apparently will test an iPhone with a six-inch screen, according to The Wall Street Journal. However, it is not a tablet, at least as far as the traditional definition of tablets goes. A small step up in size, RCA makes a 13.3 inch television screen. The breadth of screen sizes opens the question of what is a smartphone, a tablet or a TV, and what some can watch based on their deteriorating vision.

Does the screen size debate matter? Yes, to the extent of what people are willing to do with a device. It is assumed that a smartphone is portable enough to carry in a pocket, probably. And a tablet has to fit in a brief case or backpack, perhaps. A television is a free-standing device that has to go on a stand or on a wall, or be suspended by wire from a ceiling.

Another question about screen size is what people will do with a device, what will they use it for? New wearable watches may have screens too small to view anything but video clips. Tablet screens may be too small to watch some HD programs. TVs are bolted-down devices, no matter how well they display video content.

The consumer electronics industry still makes distinctions that may be false, at least as far as many consumers are concerned. That cracks open the door to whether definition matters in a world in which the utility of screen size is more a matter of what content it can play and the extent to which the display is acceptable to consumers.

It may be that the only line of demarcation left in the spectrum from video watches to televisions is price. Perhaps consumers believe that the larger the screen, the more they will need to pay. That line has been blurred, too. Philips makes a 32-inch screen that retails for $450 (used) on Amazon.com Inc. (NASDAQ: AMZN). As a matter for fact, Amazon may be the largest warehouse of video devices. It sells the tiny Samsung Rugby III handset and television screens of more than 70 inches.

The line between video viewing devices already has disappeared to the point where size matters less and less. The definition probably is based on whether consumers believe that labels mean anything as video devices grow bother larger and smaller. Perhaps the line that gets drawn is based on age. People older than 65 own televisions in greater numbers than smartphones. However, for older people, the definition may not matter either. They just cannot see small screens as their vision gets worse. Otherwise, they might want that six-inch screen iPhone just like everyone else does.

Can Verizon Move Higher After a Recent Deal?

With shares of Verizon (NYSE:VZ) trading around $45, is VZ an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework: With shares of Verizon (NYSE:VZ) trading around $45, is VZ an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Verizon is a provider of communications, information and entertainment products and services to consumers, businesses and governmental agencies. It operates in two primary segments: Verizon Wireless and Wireline. Verizon Wireless's communications products and services include wireless voice and data services and equipment sales, which are provided to consumer, business and government customers across the United States. Wireline's communications products and services include voice, Internet access, broadband video and data, Internet protocol network services, network access, long distance, and other services.

Verizon has moved forward with readying investments to purchase Vodafone's (NASDAQ:VOD) stake in Verizon Wireless, which will cost Verizon Communications $130 billion. Verizon has begun syndicating a $61 million bridge loan, sources told Reuters. The acquisition is expected to close in the first quarter of next year. Verizon will pay Vodafone $58.9 million in cash and will back the rest of the deal with loans, the sources said.

T = Technicals on the Stock Chart Are Weak
Verizon stock has struggled to make positive progress in the last several months. The stock is currently trading near opening prices of the year. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Verizon is trading below its key averages which signal neutral to bearish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Verizon options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-IV Percentile	90-Day IV Percentile
Verizon Options	23.68%	93%	90%

What does this mean? This means that investors or traders are buying a very significant amount of call and put options contracts as compared to the last 30 and 90 trading days. Verizon is a provider of communications, information and entertainment products and services to consumers, businec0al?

	Put IV Skew	Call IV Skew
September Options	Steep	Average
October Options	Steep	Average

As of today, there is an average demand from call buyers or sellers and high demand by put buyers or low demand by put sellers, all neutral to bearish over the next two months. To summarize, investors are buying a very significant amount of call and put option contracts and are leaning neutral to bearish over the next two months.
On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Increasing Quarter-Over-Quarter
Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Verizon’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Verizon look like and more importantly, how did the markets like these numbers?

	2013 Q2	2013 Q1	2012 Q4	2012 Q3
Earnings Growth (Y-O-Y)	14.06%	15.25%	-107.21%	14.29%
Revenue Growth (Y-O-Y)	4.32%	4.17%	5.66%	3.92%
Earnings Reaction	-1.51%	2.76%	0.58%	2.37%

Verizon has seen rising earnings and revenue figures over the last four quarters. From these numbers, the markets have generally been pleased with Verizon’s recent earnings announcements.

P = Weak Relative Performance Versus Peers and Sector
How has Verizon stock done relative to its peers AT&T (NYSE:T), T-Mobile (NASDAQ:TMUS), Sprint (NYSE:S), and sector?

	Verizon	AT&T	T-Mobile	Sprint	Sector
Year-to-Date Return	-13.20%	-8.28%	35.66%	22.88%	10.17%

Verizon has been a poor relative performer, year-to-date.

Conclusion

Verizon provides communications products and services through a variety of mediums to consumers and companies around the world. The company is reportedly ready to pursue the purchase of Vodafone’s stake in Verizon Wireless. The stock has struggled in the last several months and looks to be trending lower. Over the last four quarters, earnings and revenues have been rising which have generally pleased investors in the company. Relative to its peers and sector, Verizon has been a weak year-to-date performer. WAIT AND SEE what Verizon does this coming quarter.

Canada Stocks Rise as Jobs Data, Air Canada Profit Top Estimates

Canadian stocks rose the most in three weeks as Air Canada reported higher-than-estimated earnings and jobs data beat economists' forecasts.

Air Canada, the nation's largest airline, surged 7.2 percent after reducing costs. Manulife Financial Corp. (MFC), Canada's largest insurer, increased 2.6 percent for a fourth day of gains. Trilogy Energy Corp. plunged 9.8 percent after reporting a loss as sales declined. Detour Gold Corp. plunged 18 percent after saying it will not meet its 2013 production targets. Centerra Gold Inc. and HudBay Minerals Inc. sank at least 3.7 percent as gold dropped to a three-week low in New York.

The Standard & Poor's/TSX Composite Index (SPTSX) rose 84.13 points, or 0.6 percent, to 13,378.33 at 4 p.m. in Toronto. The benchmark Canadian equity gauge has advanced 7.6 percent this year, the third-worst performance among global developed markets, ahead of Hong Kong and Singapore.

"Canada's job numbers were modestly better than expected, so that's positive," said Anish Chopra, a fund manager with TD Asset Management Inc. in Toronto. His firm manages about C$216 billion ($206 billion). "It looks like the U.S. economy, at least by employment, has weathered the shutdown quite well. The reaction gold investors are having is this is another data point the Fed will use for tapering."

The U.S. added 204,000 workers in October, ahead of the median economists' forecast of 120,000, according to a Labor Department report today. The Federal Reserve has said improvements in employment figures may prompt a reduction, or tapering, of its stimulus program.

Jobs Data

Canada's jobless rate remained at 6.9 percent, the lowest since 2008, as government workers led the third straight month of job gains. Employment rose by 13,200 in October, compared to a median forecast of 11,000 from a Bloomberg survey of economists.

Air Canada (AC/B) jumped 7.2 percent to C$5.99, the highest close in five years, as nine of 10 industries in the S&P/TSX rose. Trading volume was 16 percent higher compared with the 30-day average.

Air Canada, the best-performing stock in the S&P/TSX in 2013 with a 242 percent advance, reported adjusted earnings of C$1.29 a share, ahead of the C$1.04 average analyst estimate in a Bloomberg survey. The company is working to reduce costs at the carrier by about 15 percent.

Housing Starts

Royal Bank of Canada, the nation's largest lender, rose 0.7 percent to C$70.31 and Toronto-Dominion Bank, the second-largest, increased 0.8 percent to C$96.96. The S&P/TSX Banks Index climbed 0.6 percent to a record.

Housing starts in Canada jumped to the highest level in five months in October, led by construction of multiple-unit projects such as condominiums.

Manulife climbed 2.6 percent to C$19.72 to pace gains among financial stocks. The company has advanced 6.7 percent in the past four days, and yesterday reported rising profit on higher sales of insurance and savings products.

Hot Biotech Companies To Watch For 2014

Trilogy Energy sank 9.8 percent to C$26.76, the biggest drop since 2008 on a closing basis, after reporting a loss of 8 Canadian cents a share, compared with 17 cents of earnings a quarter ago. Sales volumes for the third quarter averaged 31,211 barrels of oil equivalent per day, a 16 percent drop from the previous quarter due to field maintenance.

Detour Gold (DGC) plunged 18 percent to C$6.35, an almost five-year low. The company said in a statement it will not reach its 2013 production target of 270,000 ounces of gold and now forecasts 240,000 to 260,000 ounces.

Centerra Gold slumped 8.8 percent to C$3.54 and HudBay Minerals tumbled 3.7 percent to C$8.42. Gold futures for December delivery declined 1.8 percent to settle at $1,284.60 an ounce in New York, the lowest since Oct. 16.

BofA CEO: Housing Market 'Fairly Stable'

Bank of America Corp.(BAC) Chief Executive Brian Moynihan said the U.S. housing market is “fairly stable” at a Wall Street Journal event in New York Wednesday.

Bloomberg

Big banks have seen their mortgage banking income decline in recent quarters as refinancing activity fizzles. But Mr. Moynihan said that a decrease in refinancing activity is not indicative of the strength of the overall U.S. housing market. Instead, he said that home purchases, which have grown slightly since the beginning of the year, are what spurs broader economic growth.

The head of second-largest U.S. bank by assets also said that consumer spending has been solid, even in the face of a partial government shutdown.

“Even in those weeks, you didn’t see a break in consumer spending,” Mr. Moynihan told Wall Street Journal Managing editor Gerard Baker.

Mr. Moynihan said he thinks the debate in Washington has become more sober since the government shutdown, and that a government default on its debt is off the table.

He added that he believed the Federal Reserve would keep rates low until the economy starts to show greater signs of growth.

Mr. Moynihan also spoke about how the bank has spent more than $40 billion to date putting its legal troubles behind it. He wouldn’t say whether he thinks the government is unfairly “shaking down” big banks with penalties for crisis-era behavior.

“What’s fair and unfair is a debate I have at 10 o’clock at night by myself,” he said.

Best Bank Stocks For 2014

Home Loan Servicing Solutions (NASDAQ: HLSS  ) is servicing its capital base with a new share offering that should total nearly $300 million. The company is floating 13 million shares of its stock in an underwritten public issue at a price of $23 per share. All told, the gross proceeds of the offering should amount to roughly $299 million.

HLSS said it plans to use its share of the proceeds of the issue to purchase the mortgage servicing assets of Ocwen's (NYSE: OCN  ) loan servicing arm, plus expenses related to the transaction.

The joint book-running managers of the issue are Barclays' Capital division, JPMorgan Chase's (NYSE: JPM  ) J.P. Morgan Securities, Bank of America's (NYSE: BAC  ) Merrill Lynch, and the Securities unit of Wells Fargo (NYSE: WFC  ) . The offering is expected to close on June 26.

At the moment, HLSS has nearly 57 million shares outstanding, and its stock trades at $23.01 per share.

Best Bank Stocks For 2014: State Street Corporation(STT)

State Street Corporation, a financial holding company, provides various financial products and services to institutional investors worldwide. The company?s Investment Servicing business line provides products and services, including custody, product- and participant-level accounting; daily pricing and administration; master trust and master custody; record-keeping; foreign exchange, brokerage, and other trading services; securities finance; deposit and short-term investment facilities; loan and lease financing; investment manager and alternative investment manager operations outsourcing; and performance, risk, and compliance analytics. This segment also offers shareholder services, which comprise mutual fund and collective investment fund shareholder accounting. Its Investment Management business line provides a range of investment management, investment research, and other related services, such as securities finance; and strategies for managing passive and active financ ial assets, such as enhanced indexing and hedge fund strategies for U.S. and global equities and fixed-income securities. The company serves mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, foundations, endowments, and investment managers. State Street Corporation was founded in 1832 and is headquartered in Boston, Massachusetts.

Advisors' Opinion:

• [By Adam Levine-Weinberg]

  One way to grow your retirement savings is by investing in low-fee index funds, such as State Street's (NYSE: STT  ) ETF that tracks the S&P 500 index: SPDR S&P 500 (NYSEMKT: SPY  ) . State Street invented the ETF concept two decades ago and remains a leader in the ETF market, with index funds tracking individual S&P 500 sectors as well as the full index. (State Street has actively managed funds, as well.)

• [By Holly LaFon]

  Yacktman released his fourth-quarter buys and sells on Wednesday, according to GuruFocus��Real Time Picks. His three largest buys are Goldman Sachs Group Inc. (GS), Bank of America Corp. (BAC) and State Street Corp. (STT).

• [By Inyoung Hwang]

  Chen today has buy recommendations on IntercontinentalExchange Inc. (ICE) and asset manager State Street Corp. (STT)

  The top analyst of large-cap banks in the Greenwich Associates/Bloomberg Markets ranking is Betsy Graseck of Morgan Stanley. In one of her best calls, she saw bad news for JPMorgan as good news for investors.

• [By Holly LaFon]

  In the fourth quarter, Yacktman�� biggest additions to his holdings were Research In Motion (RIMM) and Avon Products (AVP). He also surprised followers by venturing into financials, with new positions in Goldman Sachs (GS), Bank of America (BAC), State Street Corp. (STT) and Northern Trust Corp. (NTRS).

Best Bank Stocks For 2014: Wells Fargo & Company(WFC)

Wells Fargo & Company, through its subsidiaries, provides retail, commercial, and corporate banking services primarily in the United States. The company operates in three segments: Community Banking; Wholesale Banking; and Wealth, Brokerage, and Retirement. The Community Banking segment offers deposits, including checking, market rate, and individual retirement accounts; savings and time deposits; and debit cards. Its loan products comprise lines of credit, auto floor plans, equity lines and loans, equipment and transportation loans, education loans, residential mortgage loans, health savings accounts, and credit cards. This segment also provides equipment leases, real estate financing, small business administration financing, venture capital financing, cash management, payroll services, retirement plans, loans secured by autos, and merchant payment processing services; purchases sales finance contracts from retail merchants; and a family of funds, and investment managemen t services. The Wholesale Banking segment offers commercial and corporate banking products and services, including commercial loans and lines of credit, letters of credit, asset-based lending, equipment leasing, international trade facilities, trade financing, collection services, foreign exchange services, treasury and investment management, institutional fixed-income sales, commodity and equity risk management, insurance, corporate trust fiduciary and agency services, and investment banking services. This segment also provides banking products for commercial real estate market, and real estate and mortgage brokerage services. The Wealth, Brokerage, and Retirement segment offers financial advisory, brokerage, and institutional retirement and trust services. As of December 31, 2010, the company served its customers through approximately 9,000 banking stores in 39 States and the District of Columbia. Wells Fargo & Company was founded in 1929 and is headquartered in San Franci sco, California.

Advisors' Opinion:

• [By Jessica Alling]

  The market is reacting to some global economic concerns this morning, dragging nearly all of the financials down -- including Wells Fargo (NYSE: WFC  ) . But having lost just 1.24% in the first hour of trading, the bank is faring much better than its Big Four compatriots, which have each given up 2.3%+ so far in trading. So even though Wells is down, it's certainly not out and has some big ammunition to send it higher. �

• [By Michael Flannelly]

  Analysts at Jefferies lowered the price target and earnings estimates on financials services giant Wells Fargo & Co (WFC) early on Monday, citing greater net interest margin pressure and a higher expense starting point as reasons for the negative commentary.

  The analysts maintain a “Buy” rating on WFC, but now see shares reaching $47. This price target suggests a 13% upside to the stock’s Friday closing price of $41.43.

  Wells Fargo shares were down 27 cents, or 0.65%, during pre-market trading on Monday. The stock is up 21.21% year-to-date.

• [By Jessica Alling]

  Bankable results
  The banking sector jumped this morning after Citigroup (NYSE: C  ) reported stellar second-quarter earnings that handily beat analyst estimates. Though the market has shed some of its initial excitement over the banking sector continuing to show strength in the face of challenging economic conditions, investors are looking forward to Bank of America (NYSE: BAC  ) reporting earnings on Wednesday, with the hopes that B of A will provide a three-peat. JPMorgan (NYSE: JPM  ) and Wells Fargo (NYSE: WFC  ) both reported analyst-estimate-beating results on Friday, starting off the financial sector's earnings season with a bang.

Top Dividend Stocks To Buy Right Now: Canadian Imperial Bank of Commerce(CM)

Canadian Imperial Bank of Commerce provides various financial products, services, and advice to individual, small business, commercial, corporate, and institutional clients in Canada and internationally. The company offers retail markets services comprising personal banking, business banking, and wealth management services, as well as investment management services to retail and institutional clients. It also provides wholesale banking services, including credit, capital markets, investment banking, merchant banking, and research products and services to government, institutional, corporate, and retail clients. The company provides its services through its branch network, automated bank machines, mobile banking, and online banking site. As of June 3, 2011, it operated approximately 1,100 branches and 4,000 automated bank machines in Canada. The company was founded in 1867 and is headquartered in Toronto, Canada.

Advisors' Opinion:

• [By Dan Caplinger]

  It's easy for U.S. investors to paint Canadian banks with a single brush-stroke, as the differences in the banking system helped keep Bank of Montreal and its peers safer during the financial crisis five years ago. As Canada's housing market has kept rising even after the housing bust south of its border, however, investors have gotten increasingly concerned about the potential health of its banks, especially the largest ones. With downgrades for Canadian Imperial Bank of Commerce (NYSE: CM  ) , Toronto-Dominion (NYSE: TD  ) , and Bank of Montreal among a total of six banks in January, Moody's identified higher debt levels among Canadian consumers as driving potential risk for the economy.

• [By Sean Williams]

  Looking north for opportunities
  As I head north to Canada in a few days for a vacation of my own, I can't help but think that the Canadian Imperial Bank of Commerce (NYSE: CM  ) , known better as CIBC, is getting a bad rap from shareholders in recent months, despite being one of Canada's most stable money center banks.

• [By Rich Duprey]

  Canadian Imperial Bank of Commerce� (NYSE: CM  ) �announced this morning�its second-quarter dividend of $0.96 per share, a 2% increase over the $0.94-per-share payout it made last quarter.

• [By Katia Dmitrieva]

  Canadian Imperial (CM) said it�� being shut out in the new agreement. The deal ��ppears to have been intentionally structured in a way that attempts to nullify CIBC�� right of first refusal and any ability to match,��the bank said yesterday in a statement. ��iven the structuring of the document and our contractual rights, we are exploring our options.��

Best Bank Stocks For 2014: FirstMerit Corporation(FMER)

FirstMerit Corporation operates as the bank holding company for FirstMerit Bank, N.A. that provides a range of banking, fiduciary, financial, insurance, and investment services to corporate, institutional, and individual customers in northern and central Ohio, and western Pennsylvania. The company?s commercial business offers commercial term loans, revolving credit arrangements, asset-based lending, leasing, commercial mortgages, real estate construction lending, letters of credit, cash management services, and other depository products. Its retail business provides various financial products and services, including consumer direct and indirect installment loans, debit and credit cards, debit gift cards, residential mortgage loans, home equity loans and lines of credit, fixed and variable annuities, and ATM network services, as well as deposit products comprising checking, savings, money market accounts, and certificates of deposit. The company?s wealth business provides a sset management, private banking, financial planning, estate settlement and administration, and credit and deposit products and services. FirstMerit Corporation also offers trust and investment services, including personal trust and planning, and investment management; retirement plan services; retail mutual funds, other securities, variable and fixed annuities, personal disability and life insurance products, and brokerage services; and private banking services, including credit, deposit, and asset management solutions. As of December 31, 2009, it operated a network of 160 full service banking offices and 182 ATMs. The company was founded in 1855 and is headquartered in Akron, Ohio.

Best Bank Stocks For 2014: New York Community Bancorp Inc (NYCB)

New York Community Bancorp, Inc. is a bank holding company and a producer of multi-family mortgage loans in New York City, with an emphasis on apartment buildings that feature below-market rents. It has two bank subsidiaries: New York Community Bank (the Community Bank),New York Commercial Bank (the Commercial Bank. The Community Bank has 241 branches and operates through seven divisional banks. The Commercial Bank has 34 branches in Manhattan and operates 17 of its branches under the divisional name Atlantic Bank.

During the year ended December 31, 2011, all of the one-to-four family loans the Company originated was sold to government-sponsored enterprises (GSEs). In New York, the Company serves its Community Bank customers through Roslyn Savings Bank, with 55 branches on Long Island; Queens County Savings Bank, with 34 branches in the New York City borough of Queens; Richmond County Savings Bank, with 22 branches in the borough of Staten Island, and Roosevelt Savings Bank, with eight branches in the borough of Brooklyn. As of December 31, 2011, in the Bronx and neighboring Westchester County, the Company had four branches that operated directly under the name New York Community Bank.

In New Jersey, the Company serves its Community Bank customers through 51 branches that operate under the name Garden State Community Bank. In Florida and Arizona, where it has 25 and 14 branches, respectively, the Company serves its customers through the AmTrust Bank (AmTrust) division of the Community Bank. In Ohio, the Company serves its Community Bank customers through 28 branches of Ohio Savings Bank. Customers of the Community Bank and the Commercial Bank have access to their accounts through 261 of its 285 automatic teller machines (ATMs) locations in five states. The Company also serves its customers through three Websites, which include www.myNYCB.com, www.NewYorkCommercialBank.com and www.NYCBfamily.com.

Lending Activities

The Company�� principal asset is l! oans. Its loan portfolio consists of three components: covered loans, non-covered loans held for sale and non-covered loans held for investment. As of December 31, 2011, the balance of covered loans was $3.8 billion, of which $3.4 billion were one-to-four family loans. Non-covered loans held for sale consists of the one-to-four family loans that are originated for sale, primarily to GSEs. At December 31, 2011, the held-for-sale loan portfolio totaled $1.0 billion

As of December 31, 2011, loans held for investment consisted of loans that it originates for its own portfolio, and totaled $ 25.5 billion.

In addition to multi-family loans, loans held for investment include commercial real estate loans (CRE); acquisition, development and construction (ADC) loans; commercial and industrial loans (C&I), and one-to-four family loans. As of December 31, 2011, its multi-family loans represented $17.4 billion, or 68.3%, of total loans held for investment, and represented $5.8 billion, or 64.1%, of the total loans that it originated for investment. The multi-family loans it originates are typically secured by non-luxury apartment buildings in New York City. It also makes multi-family loans to property owners who are seeking to expand their real estate holdings by purchasing additional properties.

As of December 31, 2011, CRE loans represented $6.9 billion, or 26.9%, of total held for investment; ADC loans represented $445.7 million, or 1.7%, of total loans held for investment. Its ADC loan portfolio consists of loans that were originated for land acquisition, development, and construction of multi-family and residential tract projects in New York City and Long Island.

C&I loans represented $600.0 million, or 2.4%, of total held for investment. It also offers a range of loans to small and mid-size businesses for working capital (including inventory and receivables), business expansion, and the purchase of equipment and machinery. Non-covered one-to-four family loans totaled $127! .4 millio! n at December 31, 2011.

Investment Activities

The Company�� securities portfolio primarily consists of mortgage-related securities, and debt and equity (other) securities. Its investments include GSE certificates, GSE collateralized mortgage obligations (CMOs) and GSE debentures. The Community Bank and the Commercial Bank are members of the Federal Home Loan Bank of New York (FHLB-NY), one of 12 regional Federal Home Loan Banks (FHLBs) consisting of the FHLB system. As of December 31, 2011, the Company�� securities represented $4.5 billion, or 10.8%, of total assets. As of December 31, 2011, 93.7% of its securities portfolio consisted of GSE obligations; held-to-maturity securities represented $3.8 billion, or 84.0%, of total securities, and its investment in bank-owned life insurance (BOLI) was $769.0 million.

Source of Funds

The Company has four primary funding sources. These include the deposits that it added through its acquisitions or gathered through its branch network, and brokered deposits; wholesale borrowings, primarily in the form of FHLB advances and repurchase agreements with the FHLB and various brokerage firms; cash flows produced by the repayment and sale of loans, and cash flows produced by securities repayments and sales. As of December 31, 2011, deposits totaled $ 22.3 billion, which included certificates of deposit (CDs) of $7.4 billion; negotiable order withdrawal (NOW) and money market accounts of $8.8 billion; savings accounts of $ 4.0 billion, and non-interest-bearing accounts of $2.2 billion. As of December 31, 2011, the Company�� borrowed funds totaled $14.0 billion, loan repayments and sales generated cash flows of $15.0 billion, and securities sales and repayments generated cash flows of $4.2 billion.

Subsidiary Activities

As of December 31, 2011, Community Bank had 34 subsidiary corporations. Of these, 22 are direct subsidiaries of the Community Bank and 12 are subsidiaries of Community Bank! -owned en! tities. The 22 direct subsidiaries of the Community Bank include DHB Real Estate, LLC, Mt. Sinai Ventures, LLC, NYCB Community Development Corp., NYCB Mortgage Company, LLC, Eagle Rock Investment Corp., Pacific Urban Renewal, Inc., Somerset Manor Holding Corp., Synergy Capital Investments, Inc., 1400 Corp., BSR 1400 Corp., Bellingham Corp., Blizzard Realty Corp., CFS Investments, Inc., Main Omni Realty Corp., NYB Realty Holding Company, LLC, O.B. Ventures, LLC, RCBK Mortgage Corp., RCSB Corporation, RSB Agency, Inc., Richmond Enterprises, Inc. and Roslyn National Mortgage Corporation.

The 12 subsidiaries of Community Bank-owned entities include Bronx Realty Funding Company, LLC, Columbia Preferred Capital Corporation, Ferry Development Holding Company, Peter B. Cannell & Co., Inc., Roslyn Real Estate Asset Corp., Walnut Realty Funding Company, LLC, Woodhaven Investments Inc, Your New REO, LLC, Ironbound Investment Company, Inc.,The Hamlet at Olde Oyster Bay, LLC, The Hamlet at Willow Creek, LLC and Richmond County Capital Corporation.

The two direct subsidiaries of the Commercial Bank include Beta Investments, Inc., and Gramercy Leasing Services, Inc. The two subsidiaries of Commercial Bank-owned entities include Omega Commercial Mortgage Corp. and Long Island Commercial Capital Corp.

Advisors' Opinion:

• [By Rich Smith]

  Forget the "1%." These are the 4%.
  But what about the banks that are not too big to fail? By definition, the possibility of failure makes smaller banks seem riskier investments. But possessed of the ability to grow with the population, through acquisitions, and by stealing market share from the incumbents, they're potentially more rewarding investment options -- and they do exist. A relative small fry such as New York Community Bancorp (NYSE: NYCB  ) , for example, doesn't even register on the FDIC's top 10. But with a modest P/E ratio of 12, and a generous 7.3% dividend yield, you can bet NYCB registers with investors.

• [By Selena Maranjian]

  Among holdings in which Renaissance Technologies increased its stake was New York Community Bancorp (NYSE: NYCB  ) , which is offering a hefty 7.3% dividend yield. The company has recently been growing via acquisitions and its management is known for prudent management of credit risk. Bulls like that its CEO has been with the company for decades and is heavily invested in it, and a recent decline in its non-performing assets is a plus, too.

• [By Selena Maranjian]

  Among holdings in which Barrow, Hanley increased its stake were New York Community Bancorp (NYSE: NYCB  ) and Seadrill (NYSE: SDRL  ) . New York Community Bancorp, with a whopping 7.5% dividend yield, has been growing via acquisitions lately. Its CEO has been with the company for decades, and is heavily invested in it ��literally. In addition, the bank's management is known for prudent management of credit risk.

Best Bank Stocks For 2014: HDFC Bank Ltd (HDB)

HDFC Bank Limited (HDFC Bank), incorporated in August 1994, is a banking company engaged in providing a range of banking and financial services, including commercial banking and treasury operations. The Bank has overseas branch operations in Bahrain and Hong Kong. The Bank operates in four segments: treasury, which primarily consists of net interest earnings from the Bank�� investment portfolio, money market borrowing and lending, gains or losses on investment operations and on account of trading in foreign exchange and derivative contracts; retail banking, which serves retail customers through a branch network and other delivery channels; wholesale banking, which provides loans, non-fund facilities and transaction services to corporate, public sector units, government bodies, financial institutions and medium scale enterprises, and other banking business, segment includes income from para banking activities, such as credit cards, debit cards, third party product distribution, primary dealership business and the associated costs. Revenues of the retail banking segment are derived from interest earned on retail loans, net of commission (net of subvention received) paid to sales agents and interest earned from other segments for surplus funds placed with those segments, fees from services rendered, foreign exchange earnings on retail products.

Retail Banking

The Bank is a financial services provider of various deposit products, of retail loans (auto loans, personal loans, commercial vehicle loans, mortgages, business banking, loan against gold jewellery), credit cards, debit cards, depository (custody services), investment advisory, bill payments and several transactional services. Apart from its own products, the Bank distributes third party financial products, such as mutual funds and life and general insurance. As of March 31, 2012, the Bank had 2,544 branches in 1,399 Indian cities. The Bank had 8,913 automated teller machines (ATMs) during the fiscal year ended March 31,! 2012. In addition to the Bank does home loans in conjunction with HDFC Limited. Under this arrangement the Bank sells loans provided by HDFC Limited through its branches. HDFC Limited approves and disburses the loans, which are booked in their books, with the Bank receiving a sourcing fee for these loans. HDFC Limited offers the Bank an option to purchase up to 70% of the fully disbursed home loans sourced under this arrangement through either the issue of mortgage backed pass through certificates (PTCs) or by a direct assignment of loans; the balance is retained by HDFC Limited. It also distributes life, general insurance and mutual fund products through its tie-ups with insurance companies and mutual fund houses.

Wholesale Banking

The Bank provides its corporate and institutional clients a range of commercial and transactional banking products. The Bank�� commercial banking business covers the corporate sector, the emerging corporate segments and some small and medium enterprises (SMEs). The Bank has a number of business groups catering to various segments of its wholesale banking customers with a range of banking services covering their working capital, term finance, trade services, cash management, foreign exchange and electronic banking requirements. The Bank�� financial institutions and government business group (FIG) offers commercial and transaction banking products to financial institutions, mutual funds, public sector undertakings, central and state government departments. The main focus for this segment is offering various deposit and transaction banking products to this segment besides offering funded, non-funded treasury and foreign exchange products.

The Bank provides its customers both working capital and term financing. The Bank�� corporate banking business includes cash management and vendor and distributor (supply chain) finance products. The Bank has a wholesale banking branch in Bahrain, a branch in Hong Kong and two representative offic! es in the! United Arab Emirates (UAE) and Kenya. The branches offer the Bank�� suite of banking services including treasury and trade finance products to its corporate clients. The Bank offers wealth management products, remittance facilities and markets deposits to the non-resident Indian community from its representative offices.

Treasury

The treasury group is responsible for compliance with reserve requirements and management of liquidity and interest rate risk on the Bank�� balance sheet. On the foreign exchange and derivatives front, revenues are driven primarily by spreads on customer transactions based on trade flows and customers��demonstrated hedging needs. The Bank offers Indian rupee and foreign exchange derivative products to its customers. The Bank enters into foreign exchange and derivative deals with counterparties after it has set up appropriate counterparty credit limits based on its evaluation of the ability of the counterparty to meet its obligations in the event of crystallization of the exposure. The Bank also deals in Indian rupee derivatives on its own account, including for the purpose of its own balance sheet risk management.

Other banking business

The Bank has two subsidiaries: HDFC Securities Limited (HSL) and HDB Financial Services Limited (HDBFS). HSL is primarily in the business of providing brokerage services through the Internet and other channels. As of March 31, 2012, HSL had a network of 184 branches across the country. HDBFS is a non-deposit taking non-bank finance company (NBFC). Apart from lending to individuals, it grants loans to small and medium business enterprises and micro small and medium enterprises, the principle businesses of HDBFS include loans, which offers a range of loans in the secured and unsecured loans space that fulfill the financial needs of its target segment; insurance services, HDBFS is a corporate agent for HDFC Standard Life Insurance Company and sells insurance products ,as well as products, ! such as L! oan Cover and Asset Cover, and collections-BPO services, which runs six call centres. These centres cover collection requirements at over 200 towns through its calling and field teams. As on March 31, 2012, HDBFS had 180 branches in 135 cities in order to distribute its products and services.

Best Bank Stocks For 2014: Banco Bradesco SA (BBD)

Banco Bradesco S.A. (the Bank), incorporated on November 5, 1943, is commercial bank. The Bank offers a range of banking and financial products and services in Brazil and abroad to individuals, large, midsized and small companies and local and international corporations and institutions. It operates in two segments: the banking, and the insurance, pension and capitalization bonds. Its products and services encompass banking operations, such as loans and advances and deposittaking, credit card issuance, purchasing consortiums, insurance, leasing, payment collection and processing, pension plans, asset management and brokerage services. The main services it offers through Bradesco Expresso are receipt and submission of account applications; receipt and submission of account applications; Social Security National Service (INSS) benefit payments; checking and savings account deposits, and receipt of consumption bills, bank charges and taxes. In May, 2011, the Bank acquired Banco do Estado do Rio de Janeiro S.A. (BERJ).

Banking

The Banking segment includes deposit-taking with clients, including checking accounts, savings accounts and time deposits; loans and advances (individuals and companies, real estate financing, microcredit, onlending BNDES funds, rural credit, leasing, among others); credit cards, debit cards and pre-paid cards; management of receipts and payments; asset management; services related to capital markets and investment banking activities; intermediation and trading services; custody, depositary and controllership services; international banking services, and purchasing consortiums.

The Bank offers a variety of deposit products and services to our customers through its branches, including Non-interest bearing checking accounts, such as Easy Account, Click Account, Academic Account and Cell Phone Bonus Account; traditional savings accounts; time deposits, and deposits from financial institutions. As of December 31, 2011, it had 43.4 million savings a! ccounts. It offers its customers certain additional services, such as identified deposits and real-time banking transfers. Its loans and advances to customers, consumer credit, corporate and agricultural-sector loans, totaled R$263.5 billion as of December 31, 2011.

The Bank�� loan portfolio consists of short-term loans, vehicle financings and overdraft loans on checking accounts. It also provides revolving credit facilities and traditional term loans. As of December 31, 2011, it had outstanding advances, vehicle financings, consumer loans and revolving credit totaling R$58.0 billion, or 22.0% of its portfolio of loans and advances. Banco Bradesco Financiamentos (Bradesco Financiamentos) offers direct-to-consumer credit and leasing for the acquisition of vehicles and payroll-deductible loans to the public and private sectors 'in Brazil. Supported by BF Promotora de Vendas Ltda. (BF Promotora), and using the Bradesco Financiamentos brand, the Bank operates through its network of correspondents in Brazil, consisting of retailers and dealers selling light vehicles, trucks and motorcycles, to offer financing and/or leasing for vehicles. Through Bradesco Promotora brand, it offer payroll-deductible loans to social security retirees and pensioners, public-sector employees, military personnel and private-sector companies sponsoring plans, and other aggregated products (insurance, capitalization bonds, cards, purchasing consortiums, and others).

As of December 31, 2011, the Bank had 63,156 outstanding real estate loans. As of December 31, 2011, the aggregate outstanding amount of its real estate loans amounted to R$15.9 billion, representing 6% of its portfolio of loans and advances. As of December 31, 2011, it had 69,491 microcredit loans outstanding, totaling R$62.8 million. Its BNDES onlending portfolio totaled R$35.4 billion as of December 31, 2011.

The Bank provides traditional loans for the ongoing needs of its corporate customers. It had R$85.8 billion of outstand! ing other! local commercial loans, accounting for 32.5% of its portfolio of loans and advances as of December 31, 2011. It offers a range of loans to its Brazilian corporate customers, including short-term loans of 29 days or less; guaranteed checking accounts and corporate overdraft loans; discounting trade receivables, promissory notes, checks, credit card and supplier receivables, and a number of other receivables; financing for purchase and sale of goods and services; corporate real estate financing, and investment lines for acquisition of assets and machinery. As of December 31, 2011, the Bank had R$11 billion in outstanding rural loans, representing 4.2% of its portfolio of loans and advances. The Bank conducts its leasing operations through its primary leasing subsidiary, Bradesco Leasing and also through Bradesco Financiamentos.

The Bank offers electronic solutions for receipt and payment management solutions, which include collection and payment services and online resource management enabling its customers to pay suppliers, salaries, and taxes and other levies to governmental or public entities. The global cash management concept provides solutions for multinationals in Brazil and/or domestic companies operating abroad. It manages third-party assets through mutual funds; individual and corporate investment portfolios; pension funds, including assets guaranteeing the technical provisions of Bradesco Vida e Previdencia, and insurance companies, including assets guaranteeing the technical provisions of Bradesco Seguros.

The Bank�� subsidiaries Bradesco S.A. CTVM and Agora S.A. CTVM (or Bradesco Corretora and Agora Corretora, respectively) trade stocks, options, stock lending, public offerings and forwards. They also offer a range of products, such as Brazilian government securities (under the Tesouro Direto program), BM&F trading, investor clubs and investment funds.

The Bank offers a range of international services, such as foreign exchange transactions, foreign tr! ade finan! ce, lines of credit and banking. As of December 31, 2011, its international banking services included New York City, a branch and Bradesco Securities Inc., its subsidiary brokerage firm, or Bradesco Securities United States, and its subsidiary Bradesco North America LLC, or Bradesco North America; London, Bradesco Securities U.K., its subsidiary, or Bradesco Securities U.K.; Cayman Islands, two Bradesco branches and its subsidiary, Cidade Capital Markets Ltd., or Cidade Capital Markets; Argentina, Banco Bradesco Argentina S.A., its subsidiary, or Bradesco Argentina; Banco Bradesco Luxemburgo S.A. its subsidiary, or Bradesco Europe; Japan, Bradesco Services Co. Ltd., its subsidiary, or Bradesco Services Japan; in Hong Kong, its subsidiary Bradesco Trade Services Ltd, or Bradesco Trade, and in Mexico, its subsidiary Ibi Services, Sociedad de Responsabilidad Limitada, or Ibi Mexico.

The Bank�� Brazilian foreign-trade related business consists of export and import finance. In addition to import and export finance, its customers have access to a range of services and foreign exchange products, such as purchasing and selling travelers checks and foreign currency paper money; cross border money transfers; advance payment for exports; accounts abroad in foreign currency; cash holding in other countries; collecting import and export receivables; repaid cards with foreign currency (individual), and structured foreign currency transactions through its foreign units.

Insurance, pension plans and capitalization bonds

The Bank offers insurance products through a number of different entities, which it refers to collectively as Grupo Bradesco Seguros. It offers life, personal accident and random events insurance through its subsidiary Bradesco Vida e Previdencia. It offers health insurance policies through Bradesco Saude and its subsidiaries for small, medium or large companies. It provides automobile, property/casualty and liability products through its subsidiary Bradesco Auto! /RE. It a! lso offers certain automobile, health, and property/casualty insurance products directly through its Website.

Best Bank Stocks For 2014: National Australia Bank Ltd (NAB)

National Australia Bank Limited provides products, advice and services. In Australia, it operates through National Australia Bank, MLC and UBank. In the United Kingdom, it operates through Clydesdale Bank. In New Zealand, it operates through Bank of New Zealand. In the United States, it operates through Great Western Bank. Segments include Business Banking, Personal Banking, Wholesale Banking, UK Banking and NZ Banking, MLC and NAB and Great Western Ban. As of April 5, 2012, the Company and its associated entities ceased to be a substantial holder in BlueScope Steel Limited. On May 17, 2012, it ceased to be a substantial holder in Spark Infrastructure Group and Sandfire Resources NL. As of August 24, 2012, the Company and its associated entities ceased to be holder in Tabcorp Holdings Limited. In September 2012, the Company and its associated entities have ceased to be a substantial holder in Incitec Pivot Limited, as of August 30, 2012. Advisors' Opinion:

• [By Yoshiaki Nohara]

  Alacer Gold Corp. sank 4.1 percent in Sydney as the price of the precious metal declined. Honda Motor Co. (7267) lost 0.6 percent after Japan�� third-largest carmaker reported second-quarter profit that missed analysts��estimates amid slowing motorcycle sales in Southeast Asia. National Australia Bank Ltd. (NAB) retreated 2.3 percent as expenses climbed at the country�� largest lender by assets.