May 20th - 24th, 2024
Stock markets will be closed on Memorial Day; Nvidia's market capitalization soared to $1 trillion while utilities saw substantial stock market gains due to their role in powering AI data centers
The S&P 500 is down 0.66%, the Nasdaq is up 0.28%, and the Dow Industrials is down -2.12% WTD; historical data suggests that between Memorial Day and Labor Day, U.S. stock indexes typically rise, with gains seen in the S&P 500, Dow Industrials, and Nasdaq Composite
The 10-Yr U.S. Treasury yield has increased +0.092% to a current yield of 4.479%, whereas the 30-Yr U.S. Treasury yield increased +0.028% to a current yield of 4.582%
Crude oil prices decreased 2.53% to a current $76.93/bbl while bitcoin increased 1.17% to a current $67,709.90/coin
Nvidia, the chip maker, joined the prestigious group of companies with a $1 trillion market capitalization, propelled by a $221.2 billion increase in market value on Thursday, marking the second-largest daily gain ever recorded [WSJ]
Microsoft's Build conference highlighted its focus on hardware, unveiling new Surface devices integrated with generative AI capabilities and Qualcomm Snapdragon processors, aiming to challenge Apple's Mac computers [WSJ]
Utilities have emerged as a surprising stock market winner this spring, with their shares climbing significantly as they are increasingly seen as a key supplier for energy-hungry data centers powering the AI boom [WSJ]
Jamie Dimon, CEO of JPMorgan Chase, has indicated that he will likely step down within five years, a timeline shorter than previously suggested, and may stay on as chairman [WSJ]
The Vix, reflecting market volatility, has reached historic lows across various time frames, signaling widespread investor complacency despite potential risks such as a contentious election and economic uncertainties [WSJ]
Homeowners face rising insurance rates due to costly reinsurance policies, alongside copper prices hitting record highs driven by increasing demand influenced by long-term trends like AI
Homeowners in disaster-prone areas like Houston are facing skyrocketing insurance rates and reduced coverage due to increased costs of reinsurance policies
Home sales dipped for the second consecutive month in April, falling below economists' expectations due to high mortgage rates and soaring home prices, which have also led to a shortage of available properties [WSJ]
Last week's surge in investor interest in meme stocks like GameStop led to a significant increase in off-exchange trading, with a record 51.9% of shares traded on Thursday occurring outside of public stock exchanges [WSJ]
Copper prices surged to a new high, driven by growing demand influenced by long-term trends such as artificial intelligence, nationalistic industrial policies, and green-energy investment [WSJ]
M&A activity continues to remain depressed, although developments within energy, healthcare, and data science prove to be encouraging
Miner Anglo American agreed to enter talks with larger rival BHP Group after rejecting a third proposal worth ~$49B [BBG]
ExxonMobil and Shell are among energy giants evaluating bids for a up to 40% stake in Galp Energia's major oil field offshore Namibia, which could be worth $20B [BBG]
First Abu Dhabi Bank is in advanced talks to buy Turkish conglomerate Koc Group's 61.2% stake in Istanbul-based lender Yapi Kredi for ~$8B [RT]
Warburg Pincus and Singapore’s Temasek agreed to acquire independent insurance intermediary Specialist Risk Group in a $1.27B deal [BBG]
Regional lender SouthState will acquire smaller rival Independent Bank Group in a ~$2B all-stock deal [RT]
Biogen agreed to acquire Human Immunology Biosciences for up to $1.8B, with a $1.15B payment upfront [BBG]
Information security company CyberArk will acquire cybersecurity firm Venafi from PE firm Thoma Bravo in a $1.54B cash-and-stock deal [RT]
Logistics firm Saltchuk Resources, the largest shareholder of Overseas Shipholding, will acquire the liquid bulk carrier in a $950M all-cash deal [WSJ]
A consortium including a Hard Rock Hotels & Resorts is considering a bid for $864M troubled Australian casino operator Star Entertainment [BBG]
Energy company Phillips 66 agreed to acquire midstream company Pinnacle Midland from PE firm Energy Spectrum Capital for $550M in cash [RT]
Recent developments across four key industries highlight U.S. gasoline prices declining, tech companies investing billions in AI infrastructure, and a Citigroup trader's typing error causing a $444 billion sell-off of shares
Energy & Natural Resources
Gasoline prices in the United States are declining, reaching $3.58 per gallon on average, expected to ease inflation concerns, boost consumer sentiment, and potentially reduce summer driving expenses [WSJ]
Three NGOs and climate survivors are suing TotalEnergies SE's board and major shareholders in a Paris court, alleging their decisions caused climate-induced harm [RZ]
U.S. crude oil inventories rose by 1.8 million barrels, surpassing expectations, while gasoline stocks fell by 945,000 barrels, with refinery capacity utilization reaching 91.7% for the third straight week and crude oil production remaining steady at 13.1 million barrels per day [WSJ]
Technology, Media, & Telecommunications
Nvidia's stock soared by 9.15% following a robust quarter, yet emerging threats in the AI market, including competition from rivals producing their own chips and shifts in AI model deployment, pose challenges to its dominance [WSJ]
Big Tech companies like Microsoft and Amazon are investing billions of dollars in AI infrastructure projects worldwide, with plans to spread their investments across various international markets [WSJ]
South Korea has unveiled a $19 billion support package aimed at bolstering its semiconductor industry to compete with international rivals amid surging demand for advanced chips [WSJ]
Healthcare & Life Sciences
AstraZeneca announces plans to construct a $1.5 billion manufacturing facility in Singapore, aimed at bolstering its global supply of cancer treatments, particularly antibody drug conjugates [WSJ]
Hims & Hers Health saw a surge in its stock price after announcing the addition of injectable weight-loss drugs to its telehealth platform, providing patients with broader treatment options [WSJ]
Pfizer initiates a multi-year cost reduction program targeting operational efficiencies, network restructuring, and product portfolio improvements, with the initial phase projected to yield around $1.5 billion in savings by 2027 [WSJ]
Financial Services
Citigroup agreed to pay £78 million in fines to U.K. regulators after a trader's typing error led to a $444 billion sell-off of shares, causing a brief "flash crash" in European stocks [WSJ]
Regulators may slash the proposed increase in capital requirements for large banks by half, potentially saving them tens of billions of dollars, as significant changes are under consideration [WSJ]
Outside of standard macroeconomic updates and M&A developments, Ebrahim Raisi’s death, paying college athletes directly, and another Boeing incident have led news cycles
A Singapore Airlines flight from London to Singapore encountered severe turbulence, resulting in one passenger's death and injuries to at least 30 others aboard the Boeing 777-300ER [WSJ]
The NCAA and five major athletic conferences reached a $2.77 billion settlement in a class-action lawsuit, allowing college athletes to receive direct payments from their schools for the first time [WSJ]
The Iranian President, Ebrahim Raisi, died in a helicopter crash, prompting a period of national mourning and necessitating a leadership transition [WSJ]
The escalating prices of professional sports teams pose a challenge for billionaires, prompting considerations of private equity involvement to provide financial flexibility [WSJ]
The Justice Department and over two dozen states have filed a lawsuit against Live Nation, alleging monopolistic practices in ticketing and concert promotion, with claims that the company's actions stifle competition and inflate prices for fans [WSJ]
Cole LaCour
May 24, 2024
