Today stock markets returned to normal confusion after yesterday's barn-burner hopes for a COVID-19 vaccine and a sane US presidency. It is still sunny but there are traces of fog both over the vaccine and over the White House. Foreign drug-makers lined up to license the Pfizer vaccine with Israel and India heading the queue. Other fog comes from how the Mitch McConnell Senate appears to be backing the Trump policy of suing all hands, despite the majority leader's supposed good relations with President-Elect Biden, and the fact that Biden voters often voted for Republicans in the Senate and House. By backing Trump the Republican leader is opening the way to a dual win in Georgia run-offs. Trump firing his National Security Adviser Esper is an example of how nasty a man he is because this revenge puts US national interest at risk.

Another hurricane is headed our way, showing that the Deity is not yet convinced that Americans are the good guys. Theta is the 29^th so far this year, a record level. We have some reporting companies today so I will stop fulminating against the ghastly Donald and his henchmen.

Flying high

*CAE, the Canada pilot training company recommended by Patti the Biotech Maven, reported earnings of 13 loony cents per share in its Q2 (to end Sept.), beating consensus forecasts of 2 cents by 15 cents. This excluded one-offs. Its eps without adjustments was minus 2 loony cents and minus 42 cents in Q1. It also was better than last year's minus 11 loony cents in Q2. Operating profit was C$28.2 mn vs a loss of $110.3 mn in Q1. It had operating profits of C$124.8 mn in Q2 2019. Its operating income was boosted by civil segment margins rising and fuller use of its training network.

Net cash from operations came in at C$45.6 mn, down from C$88.4 mn in Q1 but was ahead of the prior Q2 level of $36.7 mn. CAE is doing better than it did a year ago when non-covid issues hurt its operations.

CAE revenues fell 21% from prior year but also beat at C$704.7 mn from Capital IQ forecast of C$634.7 mn. CAE expects to exit the corona-virus era better than before thanks to new initiatives and C$50 mn of cost cuts which will recur after 2022. Until then its business depends on demand for pilots and travel and an end to quarantines which should improve in its H2 according to management which didn't have a lot of time to work out the details. It has cut its capital expenditure by about C$100 mn to generate free cash flow this fiscal year.

Its orderbook is up C$667.8 mn at 95% of sales, and its backlog totals C$8.3 bn. There will be need for pilots again. Yesterday, CAE investigated pilot demand for Air Transport Month 2020 and the Global Airline Training and Simulation Virtual Conference (Global ATS-V) to look at longer-term pilot demand after passenger air travel collapsed under the virus. Its results showed that the active pilot population is expected to return to 2019 levels in 2022 because of pilot reitement and attrition. Starting in late 2021, there will be a short-term shortage of about 27,000 new professional pilots. Over the next decade there will be jobs for 260,000 new pilots because of age-based retirement and growth of fleet as travel recovers progressively. There will be an acute pilot shortage. CAE is up 4.5% in US markets toda.

*BAE Systems will provide engineering, testing, and evaluation support for systems aboard manned and unmanned US Naval Air Warfare Center Aircraft high altitude long endurance airborne platforms, as a follow-up to PHASA-35 BAESY makes communication, control, and weapons systems for airborne sensor systems. The UK firm is building these systems in the US. BAESY is up 5.78%.

*Microsoft plans to peddle two gaming consoles spells trouble for Nintendo (NTDOY). I sold half my Nintendo stake at $64.29 today. It was recommended by our India reporter Abhimanyu Sisodia over the protests of Chris Loew in Japan. It went further than expected as kids were kept home and restless by the virus, but this is coming to an end. It will fact big bucks rivals starting with Microsoft this holiday season.

Energy

*Schlumberger Ltd SLB rose another 3.3% today. BP rose 5.94% after rising over 15% Mon.. Royal Dutch Shell RDS-B rose 4.175.

*A recall at Tesla TSLA caused an unwarranted drop in Nio NIO stock of 8% which was later halved.

*Irish CRH rose 5.5% more because Biden will boost US infrastructure spending in its largest market.

Cemex CX rose 3.5% for the same reason.

Drugs

*Perversely, Dr Reddy's fell 2.6% because RDY is one of the first to get a license from Pfizer. It is now down only 1.09%.

*Glaxo GSK gained another 3.2% today.

*Astra-Zeneca AZN rose 4.72% after its drug Tezepelumab, developed with Amgen, met phase III trial hopes by cutting attacks in patients with severe asthma.

*Zymeworks, despite its new notoriety, plans to tell lots of conferences about its pipeline. This cut ZYME's stock which is 77% controlled by institutional investors.

*Eisai will not be long down after its kidney cancer drug Lenvina, in combination with Merck's Keytruda, produced excellent topline results, both objective response and survival. ESALY like other drug majors outside Japan has lots of irons in the fire. Eli Lilly got FDA ok for a covid-19 treatment bamlanivimab monoclonal antibodies. today. ESALY fell 4% here and is now a buy as is Japan.

*Compugen will present at 3 virtual drug conferences in the next 2 weeks which may help its share price. CGEN is Israeli. Teva is down 0.46%.

*I understand why testing stocks are down like my largest holding, Thermo Fisher, TMO. But why are pot stocks down?

Finance

*Finnish Sampo Oyi is selling 162 mn shares of Danish Nordea Bank to cut its ownership to under 16%. It will sell at euros 8.62/sh while its costs were only euros 6.46/sh but there will be a loss on its books for the tranaction. The proceeds will cut leverage and boost liquidity. SAXPY.

*Banco Santander gained 8% in the Madrid market today. SAN is now up 8% here at $2.72. It gained 17% yesterday.

*Scotiabank BNS is up 2.4% today.

*French Veolia (VEOEY) is up 5.25% on theories its move on arch-rival Suez will succeed.

*NTT Docomo (DCMYY) is down despite the yen rising vs the $. It is being bought by its parent, NTT for $40 bn worth of yen. If the yen rises our payment will fall, but it is too soon to be sure.

Harry Geisel writes:

“When evaluating Atlantica Yield, the best figure to use is Cash Available for Distribution, as opposed to the "crazy high" p/e. CAFD for Q3 grew by 14% Y/Y. There are very low GAAP earnings because of the large non-cash write-offs for their equipment. Non-cash write-offs are why dividends are treated as returns of capital and not taxable income.” It fell yesterday but is up nearly 5% today.

*I finally got news about Allianz which reported last week, under its new ticker symbol ALIZY. This is too old to cover. I blame my broker for failing to spot the ticker change.