- Asian Stocks Rise as Tesla Buoys US Tech Giants: Markets Wrap
(Bloomberg) — Stocks in Asia advanced after a US rally in tech heavyweights, whose high-stakes earnings are considered by Wall Street investors a major test of the equities bull run. Equity benchmarks rose in Japan and South Korea, while futures for Hong Kong pointed up. US futures gained in early Asian trading. In late US hours, Tesla Inc. - Oil Holds Gain with Stockpile Data and Iran Sanctions in Focus
(Bloomberg) — Oil held a gain as an industry report showed shrinking US crude stockpiles, and traders tracked progress toward fresh sanctions on Iran. Brent was steady above $88 a barrel after climbing 1.6% on Tuesday, while West Texas Intermediate was near $83. - Tesla Speeds Plan for Cheaper Cars, Calming Fears Over Strategy
(Bloomberg) — Tesla Inc. is accelerating the launch of less-expensive cars in a bid to revive sagging demand following another disappointing quarter. The electric-vehicle maker aims to start production of new models as soon as this year, well ahead of the late-2025 timing it had previously pledged. - China’s Credit Yields Drop to Record Lows on Bond Bull Run
(Bloomberg) — China’s local credit yields have fallen to the lowest level ever as investors load up on corporate bonds to boost returns in a financial system awash in liquidity. The average yield of China’s onshore three-year AAA rated corporate notes has dropped 26 basis points this month to a record low of 2.25%, according to a China Bond index. - Senate Has Votes to Clear $95B Ukraine, Israel Aid Package
(Bloomberg) — US Senate has enough votes to pass a $95 billion package that includes aid for Ukraine, Israel and Taiwan. Vote is ongoing; passage sends package to President Biden. Measure includes a bill that would force Byte Dance to divest from TikTok or face a ban in the US. - Biden Plans a $1 Billion Ukraine Weapons Package, Officials Say
(Bloomberg) — The White House is set to announce $1 billion in fresh military aid for Ukraine including 155mm artillery shells and air-defense munitions, two administration officials said, as the US looks to act quickly once a long-delayed supplemental funding request becomes law. - Bank of America’s Top India Trader Says Swap Market Too Hawkish
(Bloomberg) — Indian rates traders have pushed back expectations for an interest-rate cut way too far and that creates an opportunity in the swaps market, according to Bank of America Corp. The Reserve Bank of India is likely to cut the key policy rate by 100 basis points in the next two years. - BOJ in Hawkish Hold – Ueda Rate Guidance, QT in Focus: Economics
(Bloomberg Economics) — The Bank of Japan is set to hold rates at Friday’s meeting. With a virtuous wage-price cycle kicking into gear — and likely evident in Tokyo CPI data due hours before the decision — and a weak yen and buoyant oil prices spurring upside risks to inflation, we’ll be looking to see how hawkish Governor Kazuo Ueda is. - McCormick Wins GOP Primary for Pennsylvania Senate Seat
(Bloomberg) — Trump-backed former Bridgewater Associates chief executive officer Dave McCormick won the Republican Primary for the US Senate seat in Pennsylvania, AP projected. McCormick had no challengers in the primary and will face incumbent Democrat Bob Casey in November. - Gold’s Record-Setting Rally May Have Its Roots in Chinese Frenzy
(Bloomberg) — Gold’s record-setting rally this year has puzzled market watchers as bullion has roared higher despite headwinds that should have held it back. With prices sagging this week, the explanation may lie in China. After weeks of debate about whether a mystery buyer was stoking the rally, several prominent figures in the global gold market are coming to the conclusion that the major new driving force is a legion of fleet-footed retail investors on the Shanghai Futures Exchange. - Biden 401(k) Advice Rule Finalized Over Wall Street Pushback
(Bloomberg Law) — The US Labor Department has released a closely watched rule that will expand strict fiduciary standards of conduct to cover more retirement plan advisers, and has already drawn ire from Wall Street. The rule from the DOL’s Employee Benefits Security Administration could equip regulators with more power to oversee Wall Street heavy hitters and require companies to comply with expensive disclosure exemptions. - Hedge Funds Are Succumbing to Mind-Boggling Returns of Memecoins
(Bloomberg) — The hedge fund world appears to be finding the siren song of memecoins irresistible. When Dogwifhat became the hottest token in crypto back in December, Newport Beach, California-based Stratos launched a liquid fund that held the token, whose mascot is, of course, a dog wearing a beanie. - IBM Said to Near Acquisition of Software Provider HashiCorp
(Bloomberg) — International Business Machines Corp. is in advanced talks to acquire software company HashiCorp Inc., according to people with knowledge of the matter. IBM and HashiCorp could reach an agreement as soon as Wednesday, said the people, who asked not to be identified discussing confidential information. HashiCorp shares, which jumped as much as 28% Tuesday, closed up 19% to $29.15. - Novartis shares rose 1.8% and Novartis ADRs rose further (2.3%) in US trading hours after the Swiss drugmaker reported results for the first quarter that impressed analysts. The company also upgraded its full-year outlook.
FIRST QUARTER RESULTS: Core EPS $1.80, estimate $1.69. Core operating profit $4.54 billion, estimate $4.22 billion. Core operating margin 38.4%, estimate 37.4%. Core net income $3.68 billion, estimate $3.45 billion. Net sales $11.83 billion, estimate $11.49 billion. COMMENTARY: Proposes Giovanni Caforio as Chair of Board at AGM ’25. 2024 guidance raised – net sales expected to grow high-single to low double-digit; core operating income expected to grow low double-digit to mid-teens. - SAP shares rose 4.7% after the software company reported quarter-over-quarter acceleration in the growth rate of current cloud backlog, a key indicator of cloud revenue to be booked within next 12 months.
Results showed that SAP’s clients continued to push for a transition to cloud-based enterprise resource planning software, according to analysts. Outlook was maintained despite a miss on adjusted operating profit due to elevated share-based payments. FIRST-QUARTER RESULTS: Non-IFRS revenue EU8.04 billion, estimate EU8.03 billion. Non-IFRS cloud and software revenue EU6.96 billion, estimate EU6.93 billion. Non-IFRS gross profit EU5.77 billion, estimate EU5.83 billion. Non-IFRS operating profit EU1.53 billion, estimate EU1.7 billion. Non-IFRS EPS EU0.81, estimate EU0.89. - PepsiCo shares dropped 3% after the beverage and snack company reported first-quarter results.
After a period of the highest inflation in four decades, branded consumer-goods makers have suffered declining volumes as shoppers, especially in the US, switch to supermarkets’ own brands.
Pepsi’s North American food and drinks divisions sold fewer goods by volume compared with a year earlier. Drinks volumes were down 5% in the region. FIRST QUARTER RESULTS: Core EPS $1.61 vs. $1.50 y/y, estimate $1.52. Net revenue $18.25 billion, +2.3% y/y, estimate $18.07 billion. - General Electric shares rose 8.3% after the company reported positive results for its GE Aerospace segment. It also raised its GE Aerospace operating profit forecast.
FIRST-QUARTER RESULTS: Adjusted EPS 82c. EPS from continuing operations $1.38. Adjusted revenue $15.2 billion. Adjusted free cash flow $900 million. GE Aerospace segment profit $1.5 billion, estimate $1.42 billion. COMMENTARY: 1Q Consolidated Total Orders $20.1B, +14%. Aerospace 1Q Total Orders of $11.0B, +34%. Aerospace Raises Full-Year Guidance. Aerospace Sees Year Adj EPS $3.80 to $4.05. Aerospace Sees Yr Oper Profit $6.2B-$6.6B; Saw $6B-$6.5B. - Visa Inc. shares rose 2.2% afterhours after it reported a quarterly profit that beat Wall Street predictions as US credit-card spending climbed.
Adjusted net income for the fiscal second quarter rose 17% to $5.1 billion, or $2.51 a share, Visa said. That was 7 cents more than the average analyst estimate. In the US, where Visa gets more than 40% of its revenue, credit-card spending grew 6.2% from a year earlier. Worldwide payments volume climbed 8% and total processed transactions rose 11%. Visa forecast net revenue growth for the current quarter in the low double-digit range. Its full-year forecast remains unchanged. - Texas Instruments Inc. shares rose 7.7% afterhours after it gave a bullish revenue forecast for the current quarter, indicating that a slump in demand for industrial and automotive components may be easing.
Sales in the period will be as much as $3.95 billion, the company said. Analysts had estimated $3.78 billion. Profit will be $1.05 to $1.25 a share, versus a prediction of $1.17. The report suggests that customers have begun to resume ordering chips after working through stockpiles of components — a good sign for the broader industry. Texas Instruments, which has the widest customer base among chipmakers, serves as a bellwether for confidence in the economy — across industries ranging from space hardware to consumer electronics. - Tesla Inc. shares rose more than 13% in extended trading as plans to accelerate launch of more affordable EV models in bid to revive sagging demand outweighed an underwhelming quarterly earnings report.
Company reported revenue of $21.30 billion, -8.7% YoY, below estimates of $22.3 billion, gross margin of 17.4% vs 19.3% YoY, beating estimates of 16.5%. Adjusted earnings per share of 45 cents vs 85 cents YoY, below estimates of 52 cents. Management remains committed to company-wide cost reduction, including reducing cost of goods sold per vehicle. - MSCI Inc. shares fell 13.4% Tuesday, after the investment company reported operating revenue and operating income that missed analyst estimates, with higher-than-expected expenses weighing on its profitability.
FIRST QUARTER RESULTS: Adjusted EPS $3.52 vs. $3.14 y/y, estimate $3.45. Operating revenue $680.0 million, +15% y/y, estimate $685.2 million. Operating income $339.4 million, +7.9% y/y, estimate $350.3 million. Total operating expenses $340.6 million, +23% y/y, estimate $333.5 million. YEAR FORECAST: Still sees Net Cash Provided by Operating Activities $1.33 billion to $1.38 billion, estimate $1.37 billion. Still sees operating expenses $1.30 billion to $1.34 billion, estimate $1.33 billion. - General Motors shares rose 4.4% after the automaker boosted its year profit forecast as 1Q earnings topped estimates.
The company posted the best 1Q full size pickup sales since 2020, management said. FIRST QUARTER RESULTS: Adjusted EPS $2.62 vs. $2.21 y/y, estimate $2.12. Net sales and rev. $43.01 billion, +7.6% y/y, estimate $42.19 billion. Adjusted Ebit $3.87 billion, estimate $3.13 billion.
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