Sydney Siege Sparks Muslim Call for Calm Amid Backlash Fear (BBG) Oil Spilling Over Into Central Bank Policy as Fed Enters Fray (BBG) Biggest LBO of 2014: BC Partners to acquire PetSmart for $8.7 billion (Reuters) Tremble algos: the SEC has hired... "QUANTS" (WSJ) When the bubble just isn't bubbly enough: There’s $1.7 Trillion Locked Out of China’s Stock Rally (BBG) Oil price slide roils emerging markets, yen rises (Reuters) - may want to hit F5 on that Libya Imposes Force Majeure on 2 Oil Ports After Clashes (BBG) ... and will resume production in days Amid Crisis, Pimco Steadies Itself (WSJ) Japan’s Abe Vows to Push for Wage Increases (WSJ) Republicans Subpoena MIT Economist for Obamacare Records (Bloomberg) France Blocks Uber ‘Ride-Sharing’ Service (WSJ) Author of interrogation memo says CIA maybe went too far (Reuters) The Rise and Fall of a Rainmaker (NYT) Sony demands halt to reporting from leaked documents (Reuters) Overnight Media Digest WSJ * Large parts of central Sydney were in lockdown after at least one gunman took hostages in a cafe and placed an Islamic flag in the window, sparking concerns a terrorist attack was under way. (http://on.wsj.com/135etjz) * Since bond titan Bill Gross bolted, aggressive maneuvers by remaining Pimco executives have helped slow an investor exodus, fend off hedge funds hoping to profit from the turmoil and give Pimco more breathing room. (http://on.wsj.com/1xjmhM6) * PetSmart Inc agreed to be bought by a group led by BC Partners Inc for more than $8.2 billion, the largest private-equity buyout in an otherwise lackluster year for such deals. (http://on.wsj.com/1w8k44v) * Facing potential shortages of airline pilots and dramatic advances in automation, industry and government researchers have begun the most serious look yet at the idea of enabling jetliners to be flown by a single pilot. (http://on.wsj.com/1GnU6wN) * Chinese smartphone maker Xiaomi Inc has invested 1.26 billion yuan ($203.7 million) in local home appliances maker Midea Group Co Ltd, in a deal aimed at boosting its presence in the market for Internet-connected home electronics. (http://on.wsj.com/1wuA4hg) * Document-management and data-storage company Recall Holdings Ltd has rejected Iron Mountain Inc's 2.2 billion Australian dollar ($1.81 billion) takeover bid as too low. (http://on.wsj.com/1BGPv6g) * Sony Pictures has retained attorney David Boies in an effort to stop news publications from using stolen documents that have been leaked online. (http://on.wsj.com/1IRQdm0) * American Airlines Group Inc plans to stick with distance-based bonuses while competitors like Delta Airlines and United Airlines are switching to fare-based bonuses. (http://on.wsj.com/1ssOlWo) * A group of large money-management firms are valuing SurveyMonkey at close to $2 billion in a new round of funding that will help fuel the online questionnaire service's expansion into corporate software, said a person familiar with the matter. (http://on.wsj.com/1GGe58o) * Bob Evans Farms Inc's longtime CEO resigned as the firm's board stepped up a push to revamp the restaurant-and-food company after an activist-led proxy fight. (http://on.wsj.com/1uHaErf) FT In the year's largest leveraged buyout, U.S. pet supply retailer PetSmart agreed to be bought by a private equity consortium led by BC Partners for $8.7 bln. The investors agreed to acquire PetSmart for $83 per share, representing a premium of 9.1 pct. PayPal is extending its alternative lending services to merchants. In recent times, non-bank lending has gained acceptance in the market as startups innovate with new business models. PayPal is gearing itself up to operate as a standalone company after it spins-off from its parent eBay next year. Trading desks of London's biggest banks including Credit Suisse, Citigroup, Barclays and Goldman Sachs suffered from holding large stakes in UK's Shire Plc, after pharma major AbbVie withdrew its bid to acquire Shire in October. Citi and Credit Suisse lost about $20 mln and $6 mln respectively, according to the people familiar with the positions. China's largest nuclear power generator China General Nuclear Corporation has bought an 80 pct stake in three UK wind farms from France's EDF for more than 100 million pounds ($157.21 million). EDF will retain the 20 pct stake, operate the turbines and also buy the electricity produced. NYT * Sony Pictures Entertainment has warned media outlets against using the mountains of corporate data revealed by hackers who raided the studio's computer systems in an attack that became public last month. (http://nyti.ms/1DyrjYw) * Armed police officers have surrounded a cafe in Sydney after one or more gunmen took hostages and displayed a black flag with Arabic script. (http://nyti.ms/1vPOtPW) * A new bonanza of resources could improve Israel's ties with Egypt, Jordan and even the Palestinian Authority. The linchpin of this diplomatic push: a Texas oil company. (http://nyti.ms/1uKvBTl) * Top officials from nearly 200 nations have agreed to the first deal committing every country in the world to reducing the fossil fuel emissions that cause global warming. (http://nyti.ms/1wxCI4l) * The Italian fashion house Gucci which is among luxury brands struggling to cope with an uncertain global economy as tastes change and smaller rivals gain, has announced the departure of its creative and business heads. (http://nyti.ms/1zTg7BF) * A dispute between China and South Korea scuttled a deal that would have reduced global tariffs on $1 trillion in information technology goods. (http://nyti.ms/1yPTyKg) * The swoon in oil prices has led to a steep decline in equities, as investors feared that the declining energy demand meant that the global economy was slowing. (http://nyti.ms/12QKGLr) * A local judge in Paris has decided not to ban the low-cost service of the American ride-booking company Uber, which has increasingly faced a global backlash against its mobile application-based business. (http://nyti.ms/1vPU34U) * The American benchmark price for crude oil has broken the symbolically important $60 a barrel mark for the first time in over five years, underscoring a remarkable drop of over 40 percent since early June. (http://nyti.ms/1DyyM9O) * The Bank of England has announced a sweeping set of changes to increase transparency in how it operates and how it discloses the decisions it makes. (http://nyti.ms/1BFRw2x) * Private equity firm Permira, which acquired the German fashion brand Hugo Boss AG in 2007, plans to sell 4.9 million shares in a private placement, representing a 7 percent stake. It will be left with a 32 percent stake. (http://nyti.ms/1AaOa6E) * Banks have showed only moderate interest in a second round of cheap loans that the European Central Bank is offering in hopes of restoring commercial bank lending and combating low inflation. (http://nyti.ms/1wmKa2l) * Russia's central bank has raised its key interest rate in an effort to curb inflation and slow the plunge of the ruble. (http://nyti.ms/1IRjwFk) Canada THE GLOBE AND MAIL ** Canada's competition watchdog says the contracts Apple Inc strikes with wireless carriers to distribute its iPhone could impose conditions that effectively increase the price retail customers pay for handsets and cellular service in general. The Competition Bureau alleges obligations Apple imposes around the sale and marketing of iPhones to consumers could be reducing competition and increasing prices in several ways. (http://bit.ly/1zMMFxe) ** Revelations of a secret deal to carve up Ontario's beer market between the big-brewer-owned Beer Store and the provincially owned Liquor Control Board of Ontario have spawned a proposed class-action lawsuit demanding C$1.4 billion ($1.21 billion) in damages on behalf of beer drinkers. The notice of action filed in Toronto in Ontario Superior Court alleges the retail outlets engaged in a "conspiracy to fix, raise, maintain or stabilize prices of beer in Ontario". (http://bit.ly/1GE5vqz) ** The federal government is threatening to invoke a rarely used anti-sanctions law to block the United States from imposing Buy America rules in Canada. Outraged that Washington has banned Canadian steel from a ferry terminal overhaul in Prince Rupert, British Columbia, Ottawa is considering using the Foreign Extraterritorial Measures Act to prohibit suppliers from bowing to a foreign law on Canadian soil, according to industry sources. (http://bit.ly/12SHdfn) NATIONAL POST ** A new report from Moody's Analytics suggests the Canadian housing market has seen some "structural changes" that might justify today's prices. The Bank of Canada caused a stir this week when it suggested that housing may be anywhere from 10 percent to 30 percent overvalued although it downplayed talk of a crash. (http://bit.ly/1wnEmqp) ** Despite the rise of streaming video platforms like Netflix Inc, U.S.-based vending machine company Outerwall Inc is betting Canadian consumers are still interested in renting Blu-rays and DVDs the traditional way. Redbox's president Mark Horak sees this as an opportunity for his company's Redbox DVD and Blu-ray vending machines to gain a foothold in the Canadian market. (http://bit.ly/1DA0umB) China CHINA SECURITIES JOURNAL - Funds from China's wealth management products have been flowing into the country's stock market, which has rallied around 30 percent over the past few weeks on expectations of monetary policy easing to lift a slowing economy, industry sources said. - China's main stock index, the Shanghai Composite Index , is likely to continue rising, even though at a slower pace, in coming months as Beijing eases monetary policy and conducts large-scale economic reforms, which create hot stocks for the market, analysts said. SHANGHAI SECURITIES NEWS - China may announce comprehensive plans to reform its state-owned companies in the first quarter of next year, with the aim to allow the private sector to play a bigger role in the country's economy, sources said. PEOPLE'S DAILY - Chinese leader Xi Jinping will take part in the ceremony of the 15th anniversary of Macao's return to China to be held on Dec. 19 and 20 in the Chinese Special Administration Region. CHINA DAILY - The extension of tourist visa between the United States and China, from one year to 10 years, will provide a huge boost to travel industries of both countries, Jiang Yiyi, director of the international tourism development at the China Tourism Academy, a top Chinese tourism think-tank, said. CHINA BUSINESS NEWS - Chinese banks are expected to be able to meet the official target to extend a record 10 trillion yuan ($1.62 trillion) in new loans this year, industry sources said. The target is part of the government's efforts to curb the slowdown of China's economic growth. Britain The Times BT POISED TO MAKE FINAL CALL ON ITS CHOSEN PARTNER FOR MOBILE FUTURE BT Group could announce as early as Monday that it has chosen O2 over EE as its preferred route back into mobile phones. The telecoms group spent the weekend weighing which network to acquire as the foundation for a 9 billion pound ($14.15 billion) assault on the mobile market next year. (http://thetim.es/1yOVDWO) BALFOUR BEATTY SEEKS 1 BLN STG DEAL Balfour Beatty is to receive a renewed more than 1 billion pounds offer in the new year for its portfolio of roads, schools and hospitals investments, in a proposal to be led by Paul Lester. John Laing Infrastructure Fund, the listed investment vehicle, has confirmed that it believes troubled Balfour should sell its portfolio of public private partnership investments built up during the construction spree overseen by the last British Labour government. (http://thetim.es/1zmbIG5) MIKE ASHLEY SPREADS 40 MLN STG OF CHRISTMAS CHEER AT SPORTS DIRECT The billionaire owner of Newcastle United, Mike Ashley, has bankrolled Christmas at Sports Direct by providing a 40 million pound loan to help the company to buy jeans, hoodies and tracksuit bottoms. (http://thetim.es/1xiI1Yz) The Guardian BRITAIN'S BANKS BRACE FOR A SERIOUS STRESS TEST Britain's big banks are struggling to fund themselves on international financial markets as they face the prospect of a wave of homebuyers and big companies defaulting on their debts. The Bank of England is running a stress test on seven banks and one building society to assess their financial strength, with the results to be released Tuesday morning. (http://bit.ly/134DpHM) EDF STANDS TO RAKE IN 3.3 BLN STG WINDFALL FROM EXISTING POWER PLANTS EDF, one of Britain's big six energy suppliers, could be in line for an annual 1 billion pound windfall each year for three years from its existing coal and nuclear power stations under a controversial government-designed auction that starts on Tuesday. (http://bit.ly/1sqQUxQ) The Telegraph HSBC FEARS HORRIBLE END TO JAPAN'S QE BLITZ AS ABE WINS LANDSLIDE HSBC Holdings Plc has warned that Japan's barely-disguised attempt to drive down the yen is becoming dangerous and may spin out of control, leading to an exchange rate crisis next year and a worldwide currency storm. David Bloom and Paul Mackel, HSBC's currency strategists, voiced growing concern that Japanese Prime Minister Shinzo Abe is backing away from fiscal retrenchment and may pressure the Bank of Japan to fund policies aimed at boosting household spending. (http://bit.ly/1BETrV7) LLOYDS QUIETLY REVIVES BANK OF WALES NAME Lloyds Banking Group has quietly brought back the Bank of Wales name, in the hope that the 42-year-old brand will help bring in new customers to its savings products at a time of increasing competition in the industry. (http://bit.ly/1wt4kJc) Sky News GLITCH CAUSES ITEMS TO BE SOLD ON AMAZON FOR 1P Businesses are furious after a piece of software used by retailers on Amazon.com Inc malfunctioned, causing hundreds of items to be sold for 1 pence. Some firms which use RepricerExpress say they risk going bankrupt because the problem has resulted in them losing so much money. (http://bit.ly/1qKoY77) The Independent AIR TRAFFIC CONTROL BOSS' 600,000 STG BONUS CRITICISED AFTER IT GLITCH CAUSES MAJOR TRAVEL CHAOS The chief of British air traffic control, who receives an annual wage of more than 1 million pounds, has had his bonus questioned after a computer meltdown severely disrupted flights over the weekend. (http://ind.pn/1zSHL1z) Fly On The Wall Pre-Market Buzz ECONOMIC REPORTSDomestic economic reports scheduled for today include:Empire State manufacturing survey for December at 8:30--consensus 12.0 Industrial production for November at 9:15--consensus up 0.7%NAHB housing market index for December at 10:00--consensus 59 ANALYST RESEARCH Upgrades Allison Transmission (ALSN) upgraded to Buy from Hold at Deutsche BankCirrus Logic (CRUS) upgraded to Overweight from Underweight at BarclaysCompass Minerals (CMP) upgraded to Buy from Hold at KeyBancDarden (DRI) upgraded to Market Perform from Underperform at Telsey AdvisoryEclipse Resources (ECR) upgraded to Buy from Neutral at SunTrustEncore Capital (ECPG) upgraded to Overweight from Neutral at Piper JaffrayEntergy (ETR) upgraded to Equal Weight from Underweight at Morgan StanleyEntergy (ETR) upgraded to Neutral from Sell at CitigroupExxon Mobil (XOM) upgraded to Market Perform from Underperform at BMO CapitalGigamon (GIMO) upgraded to Outperform from Market Perform at Raymond JamesOracle (ORCL) upgraded to Overweight from Equal Weight at Morgan StanleyPG&E (PCG) upgraded to Overweight from Neutral at JPMorganSelect Comfort (SCSS) upgraded to Overweight from Neutral at Piper JaffrayServiceNow (NOW) upgraded to Top Pick from Outperform at RBC CapitalSohu.com (SOHU) upgraded to Overweight from Neutral at JPMorganSunesis (SNSS) upgraded to Buy from Neutral at Roth CapitalTronox (TROX) upgraded to Buy from Neutral at B. RileyWillis Group (WSH) upgraded to Buy from Neutral at UBS Downgrades CGG SA (CGG) downgraded to Underperform from Market Perform at Raymond JamesCenovus Energy (CVE) downgraded to Market Perform from Outperform at BMO CapitalCobalt (CIE) downgraded to Neutral from Buy at GoldmanDelek US (DK) downgraded to Underperform from Neutral at BofA/MerrillFord (F) downgraded to Hold from Buy at Deutsche BankGastar Exploration (GST) downgraded to Neutral from Buy at SunTrustItau Unitbanco (ITUB) downgraded to Neutral from Buy at GoldmanMethanex (MEOH) downgraded to Outperform from Strong Buy at Raymond JamesOGE Energy (OGE) downgraded to Hold from Buy at JefferiesSandRidge Energy (SD) downgraded to Neutral from Buy at SunTrustUPS (UPS) downgraded to Hold from Buy at Deutsche BankWisdomTree (WETF) downgraded to Neutral from Overweight at Piper Jaffray Initiations ANI Pharmaceuticals (ANIP) initiated with a Buy at GuggenheimAccuray (ARAY) initiated with a Neutral at SunTrustCachet Financial (CAFN) initiated with an Outperform at NorthlandCorporate Office Properties (OFC) initiated with a Neutral at MizuhoHabit Restaurants (HABT) initiated with a Hold at StifelHabit Restaurants (HABT) initiated with a Neutral at RW BairdHabit Restaurants (HABT) initiated with an Overweight at Piper JaffrayeHi Car Service (EHIC) initiated with a Neutral at GoldmanMedia General (MEG) initiated with a Buy at Evercore ISINeothetics (NEOT) initiated with an Overweight at Piper JaffrayNetSuite (N) initiated with a Neutral at BofA/MerrillNetSuite (N) initiated with a Neutral at BofA/MerrillParamount Group (PGRE) initiated with a Buy at BofA/MerrillParamount Group (PGRE) initiated with a Buy at Deutsche BankParamount Group (PGRE) initiated with a Buy at Evercore ISISTORE Capital (STOR) initiated with a Buy at GoldmanSTORE Capital (STOR) initiated with a Buy at StifelSTORE Capital (STOR) initiated with a Hold at KeyBancSantander Brasil (bsbr) reinstated with a Sell at GoldmanSky Solar (SKYS) initiated with an Outperform at NorthlandTwitter (TWTR) initiated with an Outperform at JMP SecuritiesVaronis (VRNS) initiated with a Buy at Summit ResearchWestern Gas Equity (WGP) initiated with a Buy at MLV & Co. COMPANY NEWSPetSmart (PETM) to be acquired by BC Partners-led consortium for $83 per share in cashBob Evans Farms (BOBE) announced that Steve Davis, by mutual agreement with the Bob Evans board, has stepped down as CEO and a director of the company. While the official change will take place immediately, Davis will remain with the company through the end of the year to assist with the transition process. The company also announced that its board has established an interim Office of the CEOBerkshire Hathaway (BRK.A) acquired Charter Brokerage from Arsenal Capital PartnersOcwen (OCN) announced $253M early buyout of mortgages from Ginnie Mae poolsExelixis (EXEL) announced collaborator Genentech (RHHBY) filed NDA for cobimetinib, vemurafenib combination EARNINGSPetrobras (PBR) reports certain Q3 financial results, delays complete report Theravance Biopharma (TBPH) sees FY15 operating loss ($160M)-($150M), consensus ($6.83) NEWSPAPERS/WEBSITES Juniper (JNPR) and Elliott in talks on board additions, WSJ reportsFacebook (FB) stops including results from Bing (MSFT) on site, Reuters reportsAlleged Sony (SNE) hackers offer to selectively withhold stolen data, Re/code reportsPayPal (EBAY) expanding lending program to merchants, FT reportsKeurig Green Mountain (GMCR) transferring coffee buying to Switzerland, Reuters saysFamily Dollar (FDO) 'likely' to postpone investor vote on Dollar Tree (DLTR) deal, NYP reportsGoPro (GPRO) shares look expensive, Barron's reportsCarnival (CCL), Royal Caribbean (RCL) could climb 20%, Barron's saysFMC Corporation (FMC) could rally 50%, Barron's says SYNDICATE CASI Pharmaceuticals (CASI) files to sell 5.4M shares for holdersCharles Schwab (SCHW) files automatic mixed securities shelfDevon Energy (DVN) files automatic mixed securities shelfEndurance Specialty (ENH) files $500M mixed securities shelfGetty Realty (GTY) files $350M mixed securities shelfHarvard Apparatus (HART) files $20M mixed securities shelfKilroy Realty (KRC) files $300M common stock offeringQuotient (QTNT) files to sell 2.85M shares for holdersRadioShack (RSH) files to sell 150,000 convertible preferred sharesSaul Centers (BFS) files to sell 515,389 shares for holders