- Asian Stocks Gain as Fed Rate Cut Hopes Build: Markets Wrap
(Bloomberg) — Asian stocks gained in early trading, as a softer reading of the Federal Reserve’s preferred measure for inflation bolstered rate-cut hopes. Equities in Australia and Japan opened higher on Monday, with futures also pointing to gains in Hong Kong. - India’s Stock Futures Rally as Polls Predict Landslide Modi Win
(Bloomberg) — India’s stock futures jumped after exit polls indicated a resounding victory for Prime Minister Narendra Modi’s ruling party in general elections that concluded Saturday. Contracts on the nation’s benchmark Nifty 50 Index climbed as much as 2.6% in early trading on Monday after most pollsters predicted the Bhartiya Janata Party-led alliance. - One Water Said to Be in Talks to Buy Rival Boat Dealer MarineMax
(Bloomberg) — One Water Marine Inc. is in talks to acquire its larger rival MarineMax Inc., people with knowledge of the matter said Sunday. One Water has made a $40-a-share offer for MarineMax following months of private discussions, the people said, asking not to be identified discussing private information. - Israel Pushes Back Against Gaza Cease-Fire Outlined by Biden
(Bloomberg) — Two days after US President Joe Biden laid out what he called an Israeli proposal to end its war on Hamas, it’s clear that key aspects of the deal have not, in fact, been embraced by Prime Minister Benjamin Netanyahu. As the war in Gaza approaches its eighth month, the impasse between Israel and Hamas over exchanging hostages for prisoners remains unchanged. - Japan’s Firms Trim Spending, Reflecting Headwinds to Growth
(Bloomberg) — Japanese companies trimmed capital investment in the first quarter, a result that likely indicates revised data due next week will continue to show the economy contracted in the period. Capital expenditures on goods excluding software fell 0.5% in the three months through March from the previous quarter following a surge in spending at the end of last year. - Oil Falls After OPEC+ Signals Plan to Return Barrels to Market
(Bloomberg) — Oil extended losses after OPEC+ set out a plan to restore some suspended production as early as October, despite concerns over the demand outlook and robust supply from outside of the group. Production curbs will continue in full in the third quarter and then be gradually phased out over the following 12 months. - A Trump Win Is Seen as a Risk to Fed Independence: MLIV Pulse
(Bloomberg) — The Federal Reserve will face a significant risk of losing its independence to ramped-up political interference if Donald Trump is elected president again, according to the latest Bloomberg Markets Live Pulse survey. Forty-four percent of respondents said they expect Trump to seek to politicize the central bank or limit its power if he returns to the White. - China’s Housing Bailout Needs Ever-Growing Central Bank Toolkit
(Bloomberg) — The People’s Bank of China is the key actor in Beijing’s intensifying effort to shore up the housing market, pumping in cash through a variety of programs with more funds available if they’re needed. The PBOC’s latest tool is likely the most powerful so far, making 300 billion yuan ($41 billion) of cheap credit available for banks to fund local government. - Ex-Goldman Executive Joins Jack Ma-Backed PE Firm in Tokyo
(Bloomberg) — A former Goldman Sachs Group Inc. executive in Japan is joining a private equity firm backed by Alibaba Group Holding Ltd. founder Jack Ma, according to a person familiar with the matter. Kei Tanaka will be in charge of Japan real estate investments at Yanfeng Capital in Tokyo when he starts later this year. - Hedge Funds Sold China Stocks by Most Since August, Goldman Says
(Bloomberg) — Hedge funds last week sold Chinese equities at the fastest pace since August 2023, after net buying in seven of the previous eight weeks, according to Goldman Sachs Group Inc.’s prime brokerage desk. Funds net sold Chinese stocks across all channels, led by ADRs and to a lesser extent H-shares, “suggesting a more cautious stance amid signs of an uneven. - Saudi Aramco’s $12 Billion Stock Offer Sells Out in Hours
(Bloomberg) — Saudi Aramco’s $12 billion share sale sold out shortly after the deal opened on Sunday, in a boon to the government that’s seeking funds to help pay for a massive economic transformation plan. The government had demand for all shares on offer in a few hours after books opened, according to terms of the deal seen by Bloomberg News. - Australia Orders China-Linked Investor to Sell Rare Earths Stake
(Bloomberg) — Australia has ordered Chinese-linked Yuxiao Fund and its associates to sell their stakes in rare earths miner Northern Minerals Ltd., part of an effort by US allies to counter the Asian nation’s dominance of critical minerals. Treasurer Jim Chalmers cited protecting the national interest as behind his decision. - Gap shares surged 28.60% after it reported strong first-quarter earnings.
Net sales came in at $3.4 billion, beating estimates of $3.28 billion. Total comparable sales were at +3%, beating estimates of +0.91%. With their first-quarter results, Gap upgraded its projections for the full year, where net sales are up slightly on a 52-week basis and sees a gross margin expansion of at least 150 bps, up from 50 bps previously. - Costco Wholesale Corp. shares dipped as much as 2.3% despite reporting upbeat third-quarter earnings.
The company reported an earnings per share of $3.78 vs $2.93 YoY, beating estimates of $3.70. Total revenue came in at $58.52 billion, +9.1% YoY, beating estimates of $57.98 billion. - Capgemini shares fell 4.5% after JPMorgan and Jefferies both downgraded their buy ratings on Friday, citing a delayed recovery in demand for IT services companies.
JPMorgan analyst Toby Ogg said weak demand data points in the IT services ecosystem and continued cautiousness among these companies have pointed to short-term cyclical pressures. Downgrades to neutral from overweight while lowering Capgemini PT to €210 from €230.Says consensus expectations for Capgemini’s growth recovery this and next year are achievable, but it would require some improvement in discretionary spending which has yet to materialize and there may be little room for upside. Room for sector valuation to re-rate is also limited, given a number of large-cap IT firms are likely to show limited growth this year and face potential risks to 2025 estimates. - Dell Technologies shares fell 17.9% on Friday, as the personal computer maker’s strong AI server sales failed to impress investors. Analysts note that the first revenue increase since 2022 came at the cost of weaker profit margins.
Investor expectations were high coming into the quarter as the stock has more than doubled this year. FIRST-QUARTER RESULTS: Adjusted EPS $1.27 vs. $1.31 y/y, estimate $1.23. Total net revenue $22.24 billion, estimate $21.62 billion. Adjusted operating income $1.47 billion, estimate $1.48 billion. SECOND-QUARTER FORECAST: Sees revenue $23.5 billion to $24.5 billion, estimate $23.17 billion.2025 YEAR FORECAST: Sees revenue $93.5 billion to $97.5 billion, estimate $94.62 billion. Sees adjusted EPS $7.40 to $7.90, estimate $7.70. Morgan Stanley analyst Erik Woodring (overweight, PT to $155 from $152): While near-term expectations get ahead of themselves, confidently buying the dip. Dell’s unexpectedly strong April quarter revenue was overshadowed by AI server backlog missing expectations. - Zscaler shares rose 8.5% on Friday after the security software firm’s results beat estimates and it raised its full-year forecast as demand for its platform grows. Analysts noted that Zscaler is defying a broader slowdown in the industry and increased their price targets on the stock.
THIRD-QUARTER RESULTS: Adjusted EPS 88c vs. 48c y/y, estimate 65c. Revenue $553.2 million, +32% y/y, estimate $536.8 million. Calculated billings $628.0 million, +30% y/y, estimate $585 million. FOURTH-QUARTER FORECAST: Sees adjusted EPS 69c to 70c, estimate 67c. Sees revenue $565 million to $567 million, estimate $565.7 million. - Marvell Technology fell 10.5% after reporting net revenue for the first quarter and July guidance in-line with average analyst estimates. Despite the match, the chipmaker’s “high share price leaves little room for error,” Morgan Stanley analysts wrote.
FIRST QUARTER RESULTS: Net revenue $1.16 billion, -12% y/y, estimate $1.16 billion. Adjusted EPS 24c vs. 31c y/y, estimate 24c. Adjusted gross margin 62.4% vs. 60% y/y, estimate 62.4%. COMMENTARY AND CONTEXT: Second Quarter Net revenue is expected to be $1.250 billion +/- 5%, EST. $1.23B. Second Quarter Non-GAAP diluted income per share is expected to be 29c +/- 5c per share, est. 28C. Morgan Stanley, Joseph Moore (equal-weight, PT $77 from $71): “The future needs to see a major inflection vs. history for there to be upside from current levels”. Prefers NVIDIA at current prices; Marvell “is becoming quite expensive”. Still a beneficiary of AI optimism notably in optical and custom silicon businesses. - GameStop shares surge as ‘Roaring Kitty’ trader posts account showing $116 million position
Meme stock GameStop is rallying again on speculation Keith Gill, the man who inspired 2021′s epic short squeeze, could currently have a huge position in the video game retailer. Gill, who goes by DeepFValue on Reddit and Roaring Kitty on YouTube and X, reappeared Sunday night, posting a screenshot of what could be his portfolio holding a significant amount of GameStop common shares and call options. The Reddit trading crowd’s favorite trader holds 5 million shares of GameStop worth $115.7 million as of Friday’s closing price, according to the account snapshot posted on Reddit’s r/SuperStonk forum. - Nvidia announces new AI chips months after latest launch as market competition heats up
Nvidia unveiled its next generation of AI chips, just months after announcing its previous model.
The quick turnaround highlights the competitive frenzy of the AI chip market and Nvidia’s sprint to keep its top spot. CEO Jensen Huang has pledged to release new AI chip technology on a one-year basis, faster than the company’s previous two-year timeline. - Asia markets rise as China factory activity expands at fastest pace in nearly two years
Asia-Pacific stock markets rose Monday after a private survey showed China’s manufacturing activity expanded at its fastest pace in nearly two years. The Caixin survey showed manufacturing PMI rose to 51.7 in May from 51.4 the previous month, at its fastest pace since June 2022. It was also higher than a Reuters poll forecast of 51.5. The private survey comes after official data on Friday that showed China’s manufacturing sector unexpectedly contracted in May. - Stock futures edge higher on first trading day of June
Stock futures inched higher Monday ahead of the first trading day in June. Futures for the Dow Jones Industrial Average rose 113 points, or 0.3%. S&P 500 futures rose 0.3%, and Nasdaq 100 futures were up 0.4%. Wall Street is coming off a strong May, with all three major averages notching their sixth positive month in seven. The Nasdaq Composite rose 6.9%, its best month since November 2023.
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