OTC Showcase Newsletter
www.otcshowcase.com – # Monday, December 10, 2012 – # – – The Markets Stocks on Wall Street nudged forward to add to gains from the previous three days (for the Dow and S&P 500 anyway) buoyed by optimistic data from China showing that the world`s second largest economy may be ready to rise from the valley of growth that it has been sliding into and ongoing budget talks in Washington, D.C.
Today`s rise takes the Dow Jones Industrial Average to its highest level since the November presidential election.
President Barack Obama and Republican House Speaker John Boehner have clearly been at odds recently regarding the so-called fiscal cliff, a series of automatic tax hikes and spending cuts that will take more than $500 billion from the U.S. economy at the first of January.
Last week Boehner accused the President of slowly walking the economy over the cliff, saying that the Democrats refuse to provide any reasonable new budget recommendations to avert the fiscal cliff. The two leaders met on Sunday for a one-on-one meeting. Representatives offered no details, but said that the lines of communication are open. Investors gleaned optimism for a crossing of the impasse that has led to political wrangling for the past several weeks.
Across the pond last week, Communist party leader Xi Jinping expressed that China will be taking the necessary steps to stabilize growth. The leader`s commentary made for tasty fodder for bulls when combined with manufacturing reaching seven-month highs and news this week that factory output and retail sales stats both topped expectations. China has been largely responsible for global expansion happening as the rest of the world limps past the economic fallout in 2008, so investors are keen to ongoing growth from the country as a leading importer of a variety of commodities and metals.
Traders shrugged off the fact that Japan, the world`s third largest economy, is officially back in a recession as of the end of the third quarter, its fifth time since 1997 with two consecutive quarters of contracting gross domestic product (the official definition of a “recession”). Japan`s economy has shrunk in three out of the past four years. The latest GDP data exerts greater pressure on the Democratic Party of Japan (the leader of the lower house) to enact policy to spark the fleeting economy against a backdrop of scrutiny from Liberal Democratic leader Shinzo Abe. Abe`s party, a proponent of greater monetary easing, is looking to reclaim control of the lower house for the first time in three years during upcoming elections on December 16.
Elsewhere overseas, Italian Prime Minister Mario Monti over the weekend said he was willing to step-down as soon as parliament passes a pending budget law.
The Dow Jones Industrial Average added 14.75 points to 13,169.88 at the closing bell. The much broader S&P 500 edged upward by 0.48 points to 1,418.55 while the tech-heavy Nasdaq rose by 8.92 points to 2,986.96.
In Blue Chip News Recently bankrupt A123 Systems, Inc. (Pinksheets:
AONEQ, -65.94%) said on Sunday that it reached terms for an asset purchase agreement with Wanxiang America Corp., a unit of privately-owned Wanxiang Group, the largest automobile component in China. The deal, which will send nearly all of the asset of A123 to Wanxiang for $256.5 million, is meeting scrutiny immediately as government officials and others believe that the US could be handing technological innovations developed by A123 under funding from the US government to the Chinese. A123 has attempted to deflect those concerns by selling for $2.25 million its government business, including military contracts, to little-known Navitas Systems, an Illinois-based provider of energy products for commercial, industrial and government agency customers. US regulators still must approve the deal. The bottom line for anyone still holding shares after A123 Systems after it filed BK in October is not good. The sale prices don`t add up to cover the company`s debt. Shares are essentially worthless.
Speaking of Chinese acquisitions, shares of Nexen (NYSE: NXY, +13.82%) rallied after Canadian regulators last week approved the $15.1 billion takeover offer of the energy company by China`s state-owned CNOOC Ltd. (NYSE:CEO, +0.23%) Shares got a smack-down late last week as rumors surfaced that the deal would not get approval, but wiped-out those losses (and then some) with Monday`s surge.
In the drug store, Zogenix (NASDAQ: ZNGX, -50.85%) shares took a pounding after the company said last Friday that the Anesthetic and Analgesic Drug Products Advisory Committee (AADPAC) voted against recommending for approval of their new painkiller drug to the FDA.
Zogenix is seeking approval of Zohydro ER, an extended-release pure hydrocodone drug. The panel questioned the approval of another, stronger dose opioid due to the increasing abuse of current drugs on the market today; sparking controversy about decision-making process of the advisory panel with regards to “punishing Zogenix” for the “sins of the previous developers.” To that end, however, AADPAC is only an advisor and the decision rests with the FDA with a decision date set for March 1, 2013 to determine if Zohydra will make it to market or not. Outwardly, this stock seems like it may see a nice bounce.
Who doesn`t love a scammer getting busted It`s expected that a settlement will be reported between federal and state authorities and HSBC on Tuesday for its alleged money laundering activities that will cost the British banking giant $1.9 billion, comprised of surrendering more than $1.2 billion in illegal gains and a series of penalties. The penalty is the largest ever of its type and adds HSBC to a list of other big banks, including Barclays, Credit Suisse and ING, with money laundering rap sheets.
Ruumors of Google buying Groupon (NASDAQ: GRPN, -9.28%) were rebutted by analysts today sending the stock lower after a 23% run on Friday after Bloomberg speculated about a deal. Still, though, shares of GRPN held a portion of the gains and above the 50 day moving average.
Apple (NASDAQ: AAPL, -0.64%) was a buzz on the web as Jefferies cut their price targets on the big fruit from $900 to $800 and suggested that an iPhone 5S will hit the market in June or July.
I`m not sure that any magnet is ever meant for consumption, but the U.S. Consumer Products Safety Commission is making sure that children won`t be eating DynoCube magnet desk toys sold by privately-held Reiss Innovations. The toys, made in China (kinda getting a theme going here today), are dangerous because when two or more are swallowed, they can stick together and possibly cause internal damage that can lead to death. Sold exclusively on Amazon.com (NASDAQ:
AMZN, -2.17%), the toys are out for recall, even though no incidents have been reported.
On to something meant to be digested, McDonald`s Corp. (NYSE: MCD, +1.05%) said that same-store sales (sales at stores opened more than one year) increased 2.4% in November, following a decline in sales during October. The figure far outstripped Wall Street expectations of a 0.17% increase.
Read all of the latest market commentary and news. – Small Cap News MobileBits Corporation (OTCBB: MBIT), provider of the Mobile Mall “SAMY,” said that it has reached another key milestone by now offers 35,000 merchants, 100 brands to over 2 million mobile subscribers in network. SAMY merchant partners offer a wide variety of products and services and include leading brands, restaurants, QSR`s, service providers and retailers who engage everyday with local shoppers through the SAMY mobile marketing and loyalty network. “It took us 14 months to achieve our first million subscribers and only 6 months to add the second million subscribers,” said Walter Kostiuk, CEO of MobileBits. Shares closed up $0.01 at $1.01.
AVT, Inc. (OTCBB: AVTC) released their third quarter 2012 financial results, which exceeded analyst and management expectations. Total revenues for the nine months ended September 30, 2012 were $10,869,269 compared to $6,269,523 for the same period in 2011, a rise of 50 percent. This increase was due in part to significant manufacturing revenues and large orders of the company`s custom kiosks. For the nine months ended September 30, 2012, net income more than doubled to $694,621, from $302,295 for the nine months ended September 30, 2011. Shares closed even at $1.48.
Shares of TG Therapeutics, Inc. (OTCBB: TGTX) increased in value as the New York-based biotech announced highlights from the TG-1101 and TGR-1202 posters presented at the 54th Annual Meeting of the American Society of Hematology (ASH), held this past weekend, at the Georgia World Congress Center in Atlanta, Georgia. Three posters on TG-1101, two posters on TGR-1202 and one poster on the combination of TG-1101 and TGR-1202 were presented. Shares rose 19 cents to $2.26.
Sports-inspired product maker Heelys, Inc. (NASDAQ: HLYS) and Sequential Brands Group, Inc. (OTCBB:SQBG) announced they entered into an agreement and plan of merger dated December 7, 2012, pursuant to which Sequential will acquire all of the outstanding shares of common stock of Heelys for $2.25 per share in cash in a deal valued at approximately $63.2 million. With the new deal, Heely`s nixed an existing asset purchase agreement with The Evergreen Group Ventures.
Shares of Heelys and Sequential both closed even for the day at $2.21 and $4.75, respectively.
Remember, you can read all of the press releases from Bulletin Board companies here – .
The latest 200 Pinksheet press releases can be read here – .
On the Economic Front, There was no market moving economic data delivered today. Investors will be looking for information on International Trade from October on Tuesday. In September, the trade deficit narrowed to $41.5 billion from $43.8 billion in August, largely on the back of a tightened gap in petroleum which contracted by $1.8 billion from August to September (to $21.7 billion). Economists at Bloomberg are predicting the trade deficit to expand back to $42.8 billion for October.
Commodities After a volatile prior week that cost gold more than 2 percent, bullion found some strength as investors digested strengthening economic data from China and continue to keep their sites on the upcoming fiscal cliff in the States. Data from China has been showing that their economy expanding, although recent trade data came in below expectatations, tempering the happy mood about strong factory output and retail sales. In the U.S. no resolve yet to the fiscal cliff is keeping some pressure on the greenback, which generallly trades inverse to gold prices. For the day, Gold for February delivery, the most actively traded on the Comex division of the New York Mercantile Exchange, was ahead by 0.48%, or $8.20, to $1,713.70 per troy ounce.
Copper futures also advanced to add-on to a 2.88% gain from the week prior. Any data from China, the world`s largest consumer of the industrial red metal, generally bodes well for speculation about future demand, helping boost prices. Copper for March delivery, the most actively traded, added $0.0425 per pound, or 1.16%, to $3.705 to hit its highest level since mid-October.
Crude oil futures ended the day modestly lower to run their losing streak to six days after being ahead initially on the hub-bub surrounding the CNOOC/Nexen deal and refinery information from China showing strength in industrial output. With global demand still relatively low, traders of the black gold are now looking ahead to an OPEC meeting on Wednesday that will determine output policy.
Contracts for crude for January delivery settled the day at $85.68 per barrel, a decline of $0.25 or 0.29%, on the New York Mercantile Exchange.
The benchmark U.S. 10-year bond slipped 0.01 basis point to 1.62%.
Company News – # Shares of Cellceutix Corporation (OTCBB: CTIX) scaled to new all-time highs after disclosing that it penned a $10 million share purchase agreement with Aspire Capital Fund. The deal, which was negotiated at very favorable terms for Cellceutix, gives this rising biotechnology company access to funds to continue advancement of Kevetrin, a novel anti-cancer drug candidate in clinical trials at Harvard`s Dana-Farber Cancer Center and Beth Israel Deaconess Medical Center, and Prurisol, a drug set to start Phase 2/3 clinical trials early in 2013 as a new treatment for psoriasis.
Shares of CTIX continued their strong 2012 uptrend with a touch of $1.45 late in the day before closing just off of those new highs at $1.45.
Read the press release – International, Inc. (OTCQB: MNAI) appointed Dr. Tri Vu Tuong as President and Chief Operating Officer to spearhead corporate initiatives to introduce the M-Fuel product of EcoloCap Solutions of Barrington, IL to leading industry players as part of a recently signed strategic alliance and distribution agreement between the companies. Dr. Truong has been intregal to the development of M-Fuel, a leading product proven to reduce fuel consumption and harmful emissions in diesel fuel and other heavy fuel oils, nearly since inception. Dr. Truong has decades of experience in the alternative fuels industry and is world-renown as a pioneer in key individual in development of overseas markets.
Shares of thinly traded Monar closed the day at 20 cents.
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