July 1st - 5th, 2024
Ten-year yields rose 20 basis points since late June, likely due to increased expectations for a Trump win, which could push rates slightly higher due to his tariff proposals potentially raising inflation
The S&P 500 is up 1.16%, the Nasdaq is up 2.22%, and the Dow Industrials is up 0.51% WTD
The 10-Yr U.S. Treasury yield has decreased -0.070% to a current yield of 4.316%, whereas the 30-Yr U.S. Treasury yield decreased -0.047% to a current yield of 4.507%
Crude oil prices increased 2.27% to a current $84.09/bbl while bitcoin decreased 11.73% to a current $55,319.50/coin
Suburban offices are outperforming city-center towers as home working persists, with downtown-office valuations halving since early 2022 while suburban office values dropped only 18% [WSJ]
Elections are increasingly challenging for investors, who must now consider potential surprise landslides and their market impacts [WSJ]
Tesla's vehicle sales declined for the second consecutive quarter but exceeded expectations, boosting its stock price and maintaining its lead over rival BYD in global EV sales [WSJ]
The likelihood of a second Trump administration has led to a sharp selloff in U.S. government bonds, with investors anticipating that policies like tax cuts could drive up deficits and inflation [WSJ]
U.S. construction spending fell 0.1% in May to $2.14 trillion annually, the first decline since October 2022, surprising economists [WSJ]
Treasury yields surged to 4.447%, Temu and Shein raise air cargo demand and freight rates, and China's EV battery market control and Boeing's Spirit AeroSystems acquisition highlight trends in supply chain dominance and reversing outsourcing
Ahead of the Fourth of July holiday, U.S. indexes were muted, Tesla stock surged, and investors are awaiting Friday's monthly jobs report [WSJ]
Treasury yields surged to 4.447% on Monday amid investor concerns that a potential Republican sweep in November could lead to larger deficits and increased inflation, devaluing existing Treasurys [WSJ]
Bargain shopping apps Temu and Shein are driving up air cargo demand from China, raising freight rates and concerns about a capacity squeeze during peak shipping season [WSJ]
China's dominance in the electric vehicle battery market, led by companies like CATL and BYD, is substantial, with significant control over the supply chain for battery materials [WSJ]
Boeing's $37.25 per share acquisition of Spirit AeroSystems highlights a trend of companies reversing outsourcing to regain supply chain control and improve air-travel safety [WSJ]
M&A activity continues to remain depressed
Italian oil major Eni plans to raise over $4.3B from the sale of global upstream assets [BBG]
Billionaire Xavier Niel offered to buy out other shareholders of Millicom International Cellular in a deal that values the LatAm telecom at ~$4.1B [BBG]
EQT is nearing a deal to acquire a 30% stake in German transit operator Flix at $3.2B valuation [BBG]
Skydance Media reached a preliminary agreement to buy Shari Redstone’s National Amusements for $1.7B and merge with Paramount Global [WSJ]
North Asia-focused PE firm MBK Partners is nearing a deal to acquire Japanese supplement maker Alinamin Pharmaceutical from Blackstone for ~$2.2B [RT]
Norwegian supply shipping company DOF agreed to acquire offshore marine service provider Maersk Supply Service from Maersk for $1.1B in cash and stock [RT]
Philippine fast food chain Jollibee will acquire a 70% stake in South Korea's Compose Coffee for $238M [RT]
PE firms including EQT, BC Partners, and General Atlantic are interested in a stake in Europe's top basketball league EuroLeague, whose owner is seeking a ~$1.1B valuation [RT]
Infrastructure company Metro Pacific Tollways and Singapore SWF GIC will acquire a ~$1B, 35% stake in Jasamarga Transjawa Tol, a unit of Indonesian toll-road operator Jasa Marga [RT]
PE firm Altor agreed to acquire a majority stake in business resilience software provider F24 from PE firm Hg [BBG]
Recent developments across four key industries highlight U.S. crude oil inventories falling by 12.2 million barrels and Walmart and Walgreens closing health services
Energy & Natural Resources
Shell expects up to $2 billion in post-tax impairments from delaying its Rotterdam biofuels plant and selling its Singapore chemicals refinery [WSJ]
U.S. crude oil inventories fell by 12.2 million barrels last week, significantly more than the expected 1.1 million barrels, as refineries increased their capacity use [WSJ]
Shell will pause construction of its Rotterdam biofuels facility to control project costs amid weak global demand and reduced profit margins in the biofuels market [WSJ]
Technology, Media, & Telecommunications
Samsung Electronics forecast a surge in second-quarter earnings to 10.4 trillion won ($7.52 billion), a nearly 16-fold increase from the previous year, driven by a strong recovery in its semiconductor business amid high demand for computing chips and the AI boom [WSJ]
A network of buyers, sellers, and couriers is bypassing U.S. export restrictions to smuggle Nvidia's advanced AI chips into China at a fraction of their market value [WSJ]
Microsoft will pay $14.4 million to settle allegations that it discriminated against employees for taking protected leave, impacting their bonuses, reviews, and promotions [WSJ]
Healthcare & Life Sciences
GSK will acquire the rights to CureVac’s Covid-19 and flu vaccines for up to €1.45 billion to bolster its vaccine portfolio and regain ground lost to mRNA competitors during the pandemic [WSJ]
Walmart is closing its 51 health centers and virtual-care offering due to unsustainable business models, joining Walgreens in retreating from direct healthcare services amid rising costs and staffing shortages [WSJ]
Indivior expects U.S. revenue growth from addiction treatments amid the opioid crisis, targeting $1.24 billion to $1.33 billion in 2024, and is moving its main stock listing to the U.S. [WSJ]
Financial Services
Robinhood's acquisition of Pluto Capital, an AI-powered investment research firm, hints at a future move into offering full-fledged investment advice, though it currently doesn't manage assets like a robo adviser [WSJ]
Cole LaCour
Jul 5, 2024
