U.S., backed by Arabs, launches first strikes on fighters in Syria (Reuters, BBG) But not all all back: Turkey Bars Kurds From Entering Syria to Fight Islamic State (BBG) Dollar Weakens on Airstrikes; Europe Stocks Drop (BBG) Ready for Rate Riot? Emerging Markets Set to Follow Fed (BBG) El-Erian "would have done things differently" (Reuters) White House fence jumper had ammunition, machete in car, prosecutors say (WaPo) Eurozone business growth slows in September, PMI survey finds (BBC) Shrinking Bond Desks Taken by Journeymen as Masters Fade (BBG) Manufacturing Rebound Relieves Growth Concerns in China (BBG) Former Trader Quits Playboy Club to Open Own Restaurant (BBG) Allergan Rejected Offer From Actavis (WSJ) Norway's Yara, CF in talks to create $27 billion global fertilizer producer (Reuters) FTC Considers Challenge to Food Merger (WSJ) Bandits Steal Berlin IPhone Cash, Showing Payment Hurdle (BBG) Argentina's Fernandez to meet billionaire investor Soros in New York (Reuters) Overnight Media Digest WSJ * The U.S. and several Middle Eastern allies struck Islamic State militants in Syria, the Pentagon said on Monday night, expanding a U.S.-led campaign into a country that has been a haven for the extremist group. Four or more Arab countries, including Jordan, the United Arab Emirates, Bahrain and Saudi Arabia, signed up to take part in strikes in Syria, with some flying alongside the U.S. warplanes, according to an allied official. (http://on.wsj.com/1qoFNxf) * The Treasury Department tightened tax rules on Monday to deter U.S. companies from moving their legal headquarters to lower-tax countries, part of a White House effort to slow a wave of so-called corporate inversions that effectively reduce federal revenues. (http://on.wsj.com/1C7RZep) * Pharmaceutical company Actavis PLC recently made a bid for Allergan Inc but the Botox-maker rejected the proposal and is closing in on its own takeover. Allergan is now in advanced talks to buy Salix Pharmaceuticals Ltd, said people familiar with the matter. (http://on.wsj.com/1pbdxyT) * A court ruling in the Lehman Brothers Holding claims case hurt a swath of managers, including some of the biggest firms in the industry, that have in recent years enjoyed a steady stream of profits from the claims. The losses are among the first for hedge funds due to Lehman claims, managers and investors in hedge funds say. (http://on.wsj.com/XZoMn5) * The Federal Trade Commission is considering a possible antitrust lawsuit to block the planned merger of Sysco Corp and US Foods Inc, concerned that combining the nation's two biggest food suppliers to restaurants, schools and other institutions could threaten competition, according to people familiar with the matter. (http://on.wsj.com/1B2FD4U) * Arab Bank PLC, the largest financial institution in Jordan, was found liable for providing assistance to Hamas in the first U.S. jury verdict against a bank in a civil terrorism-finance case. The verdict in U.S. District Court in Brooklyn potentially opens the door to more litigation under the Antiterrorism Act of 1990, which gives U.S. victims of international terrorism recourse in federal court. (http://on.wsj.com/1qoF4w7) * As the housing recovery continues in fits and starts, black and Hispanic borrowers are receiving a smaller share of mortgage loans, according to Federal Reserve data. The report, released on Monday, comes as some lenders face lawsuits alleging they aren't making enough loans to minority borrowers. (http://on.wsj.com/1wI6DWO) FT German drugs and chemicals maker Merck KGaA agreed to buy U.S.-based Sigma-Aldrich Corp for $17 billion, hoping to better focus on specialty chemicals and laboratory supplies and depend less on its pharmaceuticals business. Apple Inc sold a record 10 million of its latest phones, iPhone 6 and iPhone 6 plus, in their weekend debut. Barclays Plc will be fined close to 38 million pounds ($62.19 million) for failing to safeguard clients' funds. Britain's Financial Conduct Authority could announce the fine as early as Tuesday. Britain's biggest grocer Tesco Plc said its first-half profits were overstated by about 250 million pounds, calling on Deloitte to conduct a "comprehensive review" of its accounts. Four senior directors have been suspended while the investigation is completed. British challenger bank Aldermore <IPO-ALDE.L>, owned by private equity group AnaCap, said it planned to float on the London Stock Exchange next month. The move follows that of OneSavings Bank, which in June became the first bank to list in London in more than a decade. (1 US dollar = 0.7786 euro) (1 US dollar = 0.6111 British pound) NYT * U.S. Treasury Secretary Jacob J. Lew announced rules on Monday that are aimed at making it more difficult for American companies to lower their tax bills by relocating overseas and that would wipe out the benefits for those that do. The changes will only affect deals that were completed starting Monday.(http://nyti.ms/1mFQUqP) * Two Federal Reserve officials who have warned loudly and persistently that the Fed is overreaching in its economic stimulus campaign plan to retire next year after completing terms on the Fed's policy-making committee. The two men, and a handful of like-minded officials, have been marginalized in recent years as their warnings that inflation would accelerate have failed to materialize. (http://nyti.ms/1wHYHVB) * An online report on Monday by the technology news site TechCrunch claimed that Apple Inc would "shut down" Beats' streaming service, Beats Music, citing anonymous sources. That report quickly ricocheted around the Internet, but in a rare public statement, an Apple spokesman flatly denied it. But the company's plans for the Beats Music brand are unclear. (http://nyti.ms/1mFSUj0) * Tesco Plc, the large British grocery retailer, disclosed on Monday that it had overstated its expected half-year profit by about $400 million and that it had suspended four senior executives. (http://nyti.ms/Zbzecn) * As hotels in the United States continue on a surge in spending on renovations, an ever-more-important factor driving this investment is the growing clout of review sites like TripAdvisor Inc and Yelp Inc, and booking sites like Hotels.com. Hotel brands are reading what travelers say about them - and their competitors - and planning their investments accordingly. (http://nyti.ms/1x4c4SP) * The Securities and Exchange Commission announced on Monday that it had approved a payment of between $30 million and $35 million, to an unnamed individual who lives in a foreign country, for providing information that helped federal authorities "detect an ongoing fraud". This is the largest ever reward given by the SEC under the whistle-blower law. (http://nyti.ms/1mGfd86) Canada THE GLOBE AND MAIL ** John Tory has opened up a 22-point lead in the race to be Toronto mayor, with last-minute addition Doug Ford in second and Olivia Chow in third, new polling numbers show. (http://bit.ly/1rkuOKu) ** Netflix Inc is refusing to provide the national broadcast regulator, Canadian Radio-television and Telecommunications Commission (CRTC), with a range of sensitive data about its online streaming operations in Canada, citing concerns the data might not be kept confidential. (http://bit.ly/1C8K1BQ) ** U.S.-based Target Corp may finally be making some headway in Canada. After launching in Canada last year with prices that consumers found too high, it is now starting to offer prices that beat those at discount archrival Wal-Mart Canada Corp, a new study finds. (http://bit.ly/ZbGwN0) NATIONAL POST ** The Liberals have won a majority government in New Brunswick on a promise to rebuild the province's roads and bridges to create jobs, turfing the Progressive Conservatives from power after one term in office. At 32, Brian Gallant is slated to become the country's youngest premier and leads the Liberals to their fourth straight election victory in the past year in Eastern Canada after wins by the party in Ontario, Quebec and Nova Scotia. (http://bit.ly/1qpdVsZ) ** Three Afghanistan National Army officers who disappeared during a break from military training at a U.S. military base in Massachusetts are now in custody at the Canadian border, authorities confirmed on Monday. (http://bit.ly/1qppEYq) ** Competing groups of creditors at the Nortel Networks Corp bankruptcy trial are focusing on the legal interpretation of a 10-year-old agreement to determine how to divide billions of dollars in proceeds from the sale of Nortel's patents and intellectual property. (http://bit.ly/1wIWTeO) China CHINA DAILY - Beijing will adhere to its Hong Kong policy and will continue its support for advancing democracy in the special administrative region. CHINA SECURITIES JOURNAL - China Vanke Co Ltd is seeking shareholder authorisation to raise up to 15 billion yuan ($2.44 billion) through debt financing. SHANGHAI SECURITIES NEWS - The China Securities Regulatory Commission, the country's stock market regulator, will normalise its inspection of the underwriting process in initial public offerings. - The Dalian Commodity Exchange said it is preparing for the launch of corn starch futures. People's Daily - The anti-corruption campaign is a war China must win in a bid to purify the political eco-system, the paper said in a commentary. Britain The Guardian PHONES 4U: 2,400 STAFF SET TO LOSE JOBS AS MOBILE PHONE RETAILER SHUTS UP SHOP More than 2,400 Phones 4u staff are to lose their jobs after plans to wind up the stricken mobile phone retailer were announced on Monday. (http://bit.ly/1pp1ZqW) HINKLEY NUCLEAR REACTOR PROJECT GAINS EU APPROVAL, LEAK REVEALS British plans for a nuclear renaissance centred on a nuclear reactor in Somerset, England achieved a breakthrough when a nine-month European Union state aid investigation ended with a call for Brussels to approve the project. (http://bit.ly/1rs0mOU) The Telegraph TESCO CHAIRMAN RICHARD BROADBENT UNDER PRESSURE TO RESIGN OVER ACCOUNTING CHAOS Tesco Plc Chairman Richard Broadbent is under pressure to resign after it emerged that the company's board dismissed warnings from its own auditor about how it was accounting for commercial deals with suppliers, months before a dramatic profit warning. (http://bit.ly/1DtXANQ) Sky News BARCLAYS HIT BY 38 MLN STG FINE OVER CLIENT ASSETS Barclays Plc will be hit by the latest in a string of financial penalties this week when the financial regulator hands out a 38 million pound ($62.19 million) fine for failing to ensure adequate protection for clients' funds. (http://bit.ly/1x1BNvc) CARPHONE PRESSES ON WITH PHONES 4u REPAIR JOB Dixons Carphone Plc plans to make a statement on Tuesday that it is still interested in acquiring between 50 and 100 shops from Phones 4u's, according to sources close to the matter. (http://bit.ly/1tVVYbE) The Independent ALDERMORE BANK HEADS FOR LONDON FLOAT British challenger bank Aldermore <IPO-ALDE.L> has announced plans to float on the London Stock Exchange, which could see the bank valued at up to 900 million pounds. (http://ind.pn/1uTxwaX) (1 US dollar = 0.6110 British pounds) Fly on the Wall Pre-Market Buzz ECONOMIC REPORTS Domestic economic reports scheduled for today include: FHFA house price index for July at 9:00--consensus up 0.5%Markit manufacturing PMI for September at 9:45--consensus 58.0Richmond Fed manufacturing index for September at 10:00--consensus 10 ANALYST RESEARCH Upgrades Apogee Enterprises (APOG) upgraded to Outperform from Market Perform at NorthlandFerro (FOE) upgraded to Buy from Hold at KeyBancGarrison Capital (GARS) upgraded to Outperform from Neutral at RW BairdSVB Financial (SIVB) upgraded to Overweight from Equal Weight at BarclaysShoreTel (SHOR) upgraded to Buy from Neutral at SunTrustTeck Resources (TCK) upgraded to Outperform from Market Perform at Bernstein Downgrades Analog Devices (ADI) downgraded to Neutral from Overweight at JPMorganBed Bath & Beyond (BBBY) downgraded to Market Perform from Outperform at William BlairCameco (CCJ) downgraded to Neutral from Buy at BofA/MerrillCity National (CYN) resumed with a Market Perform from Outperform at Wells FargoClorox (CLX) downgraded to Neutral from Buy at CitigroupClorox (CLX) downgraded to Sell from Neutral at B. RileyDick's Sporting (DKS) downgraded to Market Perform from Outperform at William BlairEquinix (EQIX) downgraded to Market Perform from Outperform at Wells FargoFluor (FLR) downgraded to Market Perform from Outperform at Wells FargoGordmans Stores (GMAN) downgraded to Hold from Buy at CanaccordNanometrics (NANO) downgraded to Hold from Buy at CanaccordON Semiconductor (ONNN) downgraded to Neutral from Overweight at JPMorganSiemens (SIEGY) downgraded to Equal Weight from Overweight at Barclays Initiations BankUnited (BKU) resumed with an Outperform at Wells FargoCenovus Energy (CVE) initiated with an Overweight at JPMorganChevron (CVX) initiated with a Neutral at JPMorganContinental Resources (CLR) initiated with a Buy at CanaccordEverBank Financial (EVER) initiated with an Outperform at Wells FargoExxon Mobil (XOM) initiated with a Neutral at JPMorganFirst Interstate (FIBK) initiated with an Outperform at Wells FargoFirst Niagara (FNFG) initiated with a Market Perform at Wells FargoFirst Republic Bank (FRC) resumed with an Outperform at Wells FargoHollyFrontier (HFC) initiated with a Neutral at JPMorganImmunomedics (IMMU) initiated with a Buy at JefferiesIntuitive Surgical (ISRG) initiated with a Sector Perform at RBC CapitalInvestors Bancorp (ISBC) initiated with an Outperform at Wells FargoLaredo Petroleum (LPI) initiated with an Outperform at Raymond JamesMarathon Petroleum (MPC) initiated with an Overweight at JPMorganPhillips 66 (PSX) initiated with an Overweight at JPMorganProgenics (PGNX) initiated with a Hold at JefferiesRexnord (RXN) initiated with an Outperform at OppenheimerSVB Financial (SIVB) resumed with an Outperform at Wells FargoSangamo (SGMO) initiated with a Buy at JefferiesSignature Bank (SBNY) resumed with a Market Perform at Wells FargoTesoro (TSO) initiated with a Neutral at JPMorganUltragenyx (RARE) initiated with a Buy at JefferiesValero (VLO) initiated with a Neutral at JPMorganWebster Financial (WBS) initiated with an Outperform at Wells Fargo COMPANY NEWS Treasury, IRS announced plans to reduce inversion tax benefits (MYL, ABT, MDT, COV, VRX, AGN)Philips (PHG) said it will separate Lighting, HealthTech into two companiesFCA fined Barclays (BCS) GBP 37.75M for putting assets at riskWells Fargo Advisers (WFC) fined $5M by SEC for failing to maintain controlsAdobe (ADBE) acquired privately held Aviary, a developer of mobile Software Development Kits for the delivery of creative appsTekmira (TKMR) to collaborate with international consortium researching EbolaSupernus (SUPN) reaffirmed that it is on track to become cash flow breakeven by year-end and that the company will explore a broad range of strategic opportunitiesMcGraw Hill Financial (MHFI) to sell McGraw Hill Construction to Symphony Tech Group for $320M in cash EARNINGS Companies that missed consensus earnings expectations include:Ascena Retail (ASNA) WABCO (WBC) sees FY14 EPS $5.45-$5.75, consensus $5.62 Papa John's (PZZA) backs FY14 EPS view, including FOCUS, $1.64-$1.72, consensus $1.72Ascena Retail (ASNA) sees FY15 adjusted EPS 90c-$1.00, consensus $1.25 NEWSPAPERS/WEBSITES Allergan (AGN) rejected buyout bid from Actavis (ACT), in advanced talks for Salix (SLXP), WSJ reports (VRX)Apple (AAPL) denies shutdown of Beats Music, Re/code reportsHP (HPQ) was primarily interested in EMC's (EMC) VMware (VMW) stake, Re/code reportsAlmunia: Google (GOOG) must improve EU settlement or will face charges, WSJ saysSysco (SYY), US Foods merger could be blocked by FTC, WSJ reportsBarclays (BCS) CEO defends bank against dark pool allegations, CNBC reportsIcahn has not sold any of Herbalife (HLF) position, FBN's Gasparino says SYNDICATE Alimera Sciences (ALIM) enters $35M at-the-market agreement with CowenGenesis Energy (GEL) files to sell 4M common units representing limited partnersGrupo Aval (AVAL) 73.529M share IPO priced at $13.50Parkway Properties (PKY) 10M share Secondary priced at $18.60SB Financial (SBFG) files to sell 1.5M depositary sharesW.P. Carey (WPC) files to sell 4M shares of common stock