Halister News

(Bloomberg) -- Canada’s consumer price index seen rising 1.7% y/y in December after increasing 1.2% in November (forecast range 1.4% to 2.3%).

• “Following the sharp deceleration in November, headline CPI inflation is expected to bounce back firmly on higher energy prices and favorable base effects": TD Securities
• Retail sales seen rising 0.5% in November after increasing 1.1% in October (forecast range 0% to 1.2%); based on the value of goods sold
• ‘‘Seasonally adjusted motor vehicle sales set a new record in November, helped in part by the recent surge in job growth (albeit part-time), and strong Black Friday sales": TD

(Bloomberg) -- American International Group partners with Berkshire Hathaway subsidiary National Indemnity Company on reinsurance pact; consideration for agreement is $9.8b payable in full by June 30.

• Statement:Link

(Bloomberg) -- Western Union downgraded to sell from neutral after DOJ/FTC settlement given “permanent” margin impact from continued compliance costs, and “more aggressive” regulatory controls under Trump that will likely “scare customers” and hurt volumes, Compass Point’s John Williams writes in note.

• Sees “considerable downside” despite pullback yesterday (cuts PT to $17 from $20); settlement “changed the game,” and selling stock now is “prudent strategy” given margin/estimate uncertainty, long-term competitive woes
  • 4c-5c EPS drag in 2017 from compliance costs “would not be at all shocking”
• Sees settlement limiting capital allocation flexibility; now “far less likely” co. will do big acquisition
• Expects pricing compression given premium vs peers; notes WU hasn’t taken companywide pricing action in 2+ years
• WU has 4 buys, 15 holds, 9 sells, avg PT $20: Bloomberg data
• Short interest 12% of shares outstanding: Markit data
• NOTE: Jan. 19, WU Said to Keep Compliance Spending Unchanged
  • Western Union Settlement May Affect Share Buybacks: Jefferies
• NOTE: Jan. 4, Surge in Mexico Money Transfers Benefiting WU, MGI: JPMorgan
• NOTE: Dec. 1, Sell Western Union on Trump Immigration Stance, India Woes: Citi

(Bloomberg) -- BCB may allow BRL to extend gains, opening room for rate cut larger than 75bps in the next meeting, Olavo Souza, FI trader at Mirae says in a phone interview.

• Swaps rollover comeback shows BCB intention to change the level of USD/BRL, he says
  • Lower USD may avoid fuel price rise in Brazil even if oil prices keeps increasing
  • BCB sees lower level for activity and inflation compared to market projections
  • CPI may drop to near zero in the coming months
  • Selic could be cut to below 10% as soon as in 1H17
  • With bigger cuts, BCB could help economy resume growth in the 2H17
• NOTE: BCB to Cut Rate by 75bps Per Meeting Until July: Barclays

(Bloomberg) -- P&G 2Q core EPS $1.08, est. $1.06 (range $1.00-$1.09)

• 2Q net sales $16.9b, est. $16.8b (range $16.6b-$17.1b)
• 2Q organic rev. growth +2.00%
• 2Q free cash flow $2.26b
• 2Q Beauty organic sales +3.00%
• 2Q Grooming organic sales +1.00%
• 2Q Health Care organic sales +7.00%
• 2Q Fabric & Home Care organic sales +1.00%
• 2Q Baby, Feminine & Family Care organic sales +1.00%
• Reaffirms Forecast for Core EPS Growth for Yr
• Estimates Yr All-in sales to Be in Line With Prior FY
• Boosts Organic sales Growth Guidance for FY
• Sees Yr Organic sales Growth to 2%-3%, Saw up 2%

NOTE:

• 13 buys, 13 holds, 2 sells before today
• Call 8:30am (NY time)

Statement