April 22nd - 26th, 2024
Despite recent volatility, a severe or prolonged bear market is unlikely given the robust U.S. economy, strong consumer demand, and a stabilizing global economy
The S&P 500 is up 0.86%, the Nasdaq is down 0.42%, and the Dow Industrials is down 0.75% WTD
The 10-Yr U.S. Treasury yield has increased +0.034% to a current yield of 4.698%, whereas the 30-Yr U.S. Treasury yield increased +0.055% to a current yield of 4.805%
Crude oil prices increased 2.80% to a current $83.85/bbl while bitcoin decreased 1.16% to a current $64,197.50/coin
Renewable electricity growth is struggling to keep pace with rising power demand driven by energy-intensive sectors like artificial intelligence, electric vehicles, and industrialization, particularly in developing countries [WSJ]
Tesla surprised investors with an accelerated timeline for launching new vehicle models, combining current and next-generation platforms for efficiency but sacrificing some cost savings [WSJ]
Spotify's first-quarter results impressed investors, with revenue and operating income surpassing expectations, driven by accelerating monetization efforts [WSJ]
Copper prices have surged amid hopes for a stronger Chinese recovery, global green-tech demand, and supply constraints, including BHP's bid for Anglo American [WSJ]
General Motors reported a 24% increase in first-quarter profit, driven by strong sales of gas-powered trucks and SUVs in the U.S., prompting an upward revision of its profit outlook for the year [WSJ]
Meta Platforms is increasing its investment in AI, the Bank of Japan has ended its negative-interest policy, and Main Street banks are facing profit declines due to high interest rates
Despite hopes for a broadening market, the recent stock rally has remained top-heavy, with larger companies continuing to outperform smaller ones [WSJ]
Former President Donald Trump is poised to receive a stock grant worth $1.2 billion as his social-media company's stock, Trump Media & Technology Group, has maintained a trading price above $17.50 for 20 consecutive sessions [WSJ]
Meta Platforms, the parent company of Facebook and Instagram, has raised its projected capital expenditures for the year by 12% to $40 billion, aiming to boost investments in generative artificial intelligence [WSJ]
The Bank of Japan recently raised interest rates for the first time since 2007, signaling the end of its negative-interest-rate policy, which was a response to the global financial crisis [WSJ]
Main Street banks are grappling with steep profit declines due to persistently high interest rates, impacting their plain-vanilla businesses of deposits and loans [WSJ]
M&A activity continues to remain depressed, although developments within energy, tech, and retail prove to be encouraging
Communications infrastructure REIT Uniti Group is in advanced talks to reunite with telecom provider Windstream in a deal worth up to $15B, including debt [BBG]
IBM agreed to acquire software company HashiCorp in a $6.4B cash deal [BBG]
MassMutual agreed to acquire a minority stake in lending business Atlas from Apollo Global for over $2B [FT]
Blackstone will acquire restaurant chain Tropical Smoothie Cafe for ~$2B including debt from PE firm Levine Leichtman Capital Partners [RT]
C&S Wholesale Grocers will acquire an additional 166 stores from Kroger and Albertsons for a total of 579 stores for ~$2.9B cash [RT]
PE firm PAI Partners will acquire a majority stake in UK music equipment maker Audiotonix from French PE firm Ardian in a ~$2.5B deal [FT]
Real estate information provider CoStar Group will acquire Matterport, a provider of 3D virtual tours of properties, in a $1.6B cash-and-stock deal [RT]
UK's JD Sports Fashion agreed to buy US sportswear retailer Hibbett for $1.1B [BBG]
Ithaca Energy agreed to acquire almost all of Italian energy company Eni’s UK oil and gas fields in a ~$940M stock deal [FT]
Coffee roaster Luigi Lavazza agreed to buy vending machine maker IVS Group in a $697M cash deal [BBG]
Carlyle-backed oil pipeline company Crescent Midstream is exploring a potential sale after receiving takeover interest and could be valued at $1.3B [BBG]
Nvidia agreed to acquire Israeli AI software provider Run:ai for $700M [BBG]
French energy group TotalEnergies will acquire Malaysian oil company Sapura Energy’s 50% stake in oil and gas upstream company SapuraOMV for $705M [RT]
Recent developments across four key industries highlight Biden targeting power plant emissions, insurers posting strong earnings, and investment firms expanding their asset control
Energy & Natural Resources
The Biden administration has issued new regulations targeting power-plant pollution, particularly focusing on coal plants and newly built natural-gas plants, aiming to reduce carbon dioxide emissions significantly by 2035 [WSJ]
Exxon Mobil and Chevron reported lower first-quarter earnings compared to last year, with Exxon's profits down 28% to $8.2 billion and Chevron's down 16% to $5.5 billion, both impacted by falling natural-gas prices and refining margins [WSJ]
CNOOC reported a record-high net profit of 39.72 billion yuan (US$5.48 billion) for the first quarter, up 24% from the previous year, with revenue increasing by 14% to CNY111.47 billion [WSJ]
In 2023, Texas achieved record-high oil and gas production, with 1.92 billion barrels of oil and 12.01 trillion cubic feet of natural gas produced, according to the Texas Railroad Commission [RZ]
Technology, Media, & Telecommunications
Micron Technology is set to receive up to $6.1 billion from the U.S. government to build three chip-making facilities in New York and Idaho, fueling a $125 billion investment over the next 20 years [WSJ]
Tech stocks, known as the "Magnificent Seven," experienced a sharp selloff, shedding a combined $950 billion in market value, putting pressure on the group to deliver strong earnings [WSJ]
Investors are eagerly anticipating Meta Platforms' first-quarter earnings report, with expectations riding high due to a sharp rebound in its advertising business and improved cost efficiency [WSJ]
Microsoft's profit rose last quarter by 20%, reaching $21.9 billion, driven by increased demand for its software and cloud services, particularly bolstered by artificial intelligence integration, including its partnership with OpenAI [WSJ]
Healthcare & Life Sciences
While large insurers like UnitedHealth Group and Elevance Health reported better-than-expected earnings, signaling stabilization in healthcare utilization, the outlook for providers may not be as optimistic as previously thought [WSJ]
UnitedHealth Group is grappling with the aftermath of a ransomware attack on its business unit Change Healthcare, which operates the largest U.S. clearinghouse for medical payments, potentially affecting a substantial proportion of Americans [WSJ]
Financial Services
Giant investment firms, including Blackstone, Franklin Templeton, BlackRock, and KKR, are expanding their reach and influence, now controlling assets rivaling the economies of large countries [WSJ]
The latest economic report revealed persistently higher-than-expected inflation for the third consecutive month, contrary to hopes for a cooling trend [WSJ]
Outside of standard macroeconomic updates and M&A developments, college protests and low fertility rate in the U.S. have led news cycles
Pro-Palestinian protests have swept over 40 college campuses in the U.S. and Canada, prompting safety concerns and graduation cancellations [CNBC]
The U.S. Justice Department is conducting a criminal investigation into consulting firm McKinsey's past role in advising major opioid manufacturers on sales strategies, including whether McKinsey obstructed justice [WSJ]
President Joe Biden signed into law measures to provide aid to Israel, Ukraine, and Taiwan, alongside legislation requiring Chinese parent company ByteDance to divest TikTok or face a national ban [CNBC]
American women are giving birth at a record-low rate, with the total fertility rate falling to 1.62 births per woman in 2023, the lowest recorded since the 1930s [WSJ]
The No. 1 pick in the NFL draft went to the Bears selecting Caleb Williams, followed by the Commanders choosing Jayden Daniels; six quarterbacks were taken within the first 12 picks [CNBC]
Major media companies like Amazon, Google's YouTube, NBCUniversal, Disney, and Warner Bros. Discovery are vying for NBA media deals set to kick in after the 2024-2025 season, with robust pricing expected [WSJ]
Cole LaCour
Apr 26, 2024
