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Sunbelt apartment firms to merge in $8.6B deal. Colonial Properties Trust (CLP) and Mid America Apartment Communities (MAA) have agreed to merge in a deal that will create a Sunbelt-focused apartment REIT with a combined market cap of about $8.6B. Under the terms of the deal, each CPT share will be converted into 0.36 of a newly issued MAA share.

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Eurozone PMI improves markedly but recession still on. Eurozone manufacturing PMI rose to a 15-month high of 48.3 in May from 46.7 in April, with the downturn easing across the bloc, although price deflationary pressures remained. Of particular note was Spain, whose PMI jumped to its best level in two years with an increase to 48.1 from 44.7. However, the overall eurozone data "still suggest that GDP is likely to have fallen 0.2%" in Q2, says Markit, extending the eurozone's recession into a seventh quarter.

Drug firms report positive cancer-trial results. Bayer (BAYZF.PK) and Onyx Pharmaceuticals (ONXX) were among several pharmaceutical companies to report encouraging results from cancer-drug testing at the annual meeting of the American Society of Clinical Oncology. Bayer's and Onyx's Nexavar treatment helped prevent a rare type of thyroid cancer from getting worse for 10.8 months in patients in a Phase III study, well above the 5.8 months in subjects who took a placebo. Other firms to report include Bristol-Myers Squibb (BMY), Merck KGaA's (MKGAF.PK) and GlaxoSmithKline (GSK).

Top Stock News
Nikkei tumbles again but U.S. futures look bright. Japanese stocks suffered their fourth sharp decline in eight sessions as the Nikkei fell 3.7%, taking its losses since the market turmoil began on May 23 to 17%. "The (Japanese) market has yet to bottom, and volatility will likely remain for another month," says asset manager Yoshihiro Okumura. Much of Europe reversed earlier losses to turn green - possibly due to the PMI data? - while U.S. stock futures were up premarket following the late sell-off on Friday.

Drug failure to cost Sanofi $285M. Sanofi (SNY) will take a $285M charge on its H1 income after saying that it will halt the development of its iniparib drug after it failed in Phase III testing for lung cancer and a Phase II study for ovarian tumors. Sanofi acquired the drug as part of its $500M purchase of BiPar Sciences in 2009. Shares were -1.3% at midday in Paris.

BofA due in court over $8.5B settlement. A New York court is due to start a hearing today about whether it should approve Bank of America's (BAC) $8.5B agreement to settle claims with investors over soured mortgage bonds. The deal faces opposition from AIG (AIG), which wants BofA to pay it $10.5B in damages. Approval of the agreement would enable the bank to take a major step in cleaning up the mess it inherited when it bought Countrywide.

Apple set to face e-book charges alone. Apple (AAPL) is due to go to court today over allegations that it conspired with five publishers to raise e-book prices. Apple is facing the suit alone after the publishers involved settled with the Justice Department. Meanwhile, Apple reportedly signed a licensing deal with Warner Music over the weekend as it looks to launch a music-streaming service at its developers conference next week.

DirecTV among three to bid $1B+ for Hulu. Satellite operator DirecTV (DTV) and two other unidentified suitors have reportedly bid over $1B each to acquire Hulu. The owners of the online video service - News Corp (NWS), Disney (DIS) and Comcast (CMCSA) - have received seven offers for the company, and intend to cut the shortlist down over the next few weeks. Previous reports have said that other bidders include Yahoo (YHOO), KKR (KKR) and Time Warner Cable (TWC).

Boeing 787 back in the air despite battery glitch. It was a heart in mouth moment for Boeing (BA) yesterday after Japan Airlines took a 787 jet out of service due to a sensor indicating a problem with the Dreamliner's brand new battery box. However, the issue was merely due to some tape that hadn't been removed after testing, with the battery showing "no abnormality." The glitch came just a day after Japan Airlines and All Nippon Airways resumed 787 passenger flights.

Top Economic & Other News
Chinese PMI comes in mixed. China's HSBC PMI for May fell a bit more than the "flash" read, coming in at 49.2 vs. 50.4 in April. The downward revision "suggests a marginal weakening of activities towards the end of last month, thanks to deteriorating domestic demand conditions," says HSBC. However, the official PMI rose a greater-than-expected 0.2 points to 50.8.

Manhattan property market sizzles with billion dollar deals. The General Motors Building in Manhattan has become the most valuable office property in America after the families of Chinese property developer Zhang Xin and Brazil's Safra banking empire acquired a 40% stake in the 50-story skyscraper for $1.4B. Reports of the deal, which values the GM Building at $3.4B, follow news that Carlyle is selling a 27-story Manhattan building for $1.3B.

Turkish markets plunge after protests continue over weekend. Turkish shares (TUR) have plummeted after demonstrations in Istanbul over the preservation of a park turned into a vehicle for an outpouring of anti-government anger amid accusations that it is becoming increasingly authoritarian. Over 1,000 people have been injured and at least two have died as the crowds braved tear gas and rubber bullets. The Istanbul National 30 index was -6.6% at midday in Europe, while the lira was -0.7% vs the dollar.