1. Asian Stocks Rally, Yen Climbs to Three-Week High: Markets Wrap

    (Bloomberg) — Equities in Asia climbed and the yen rallied, ahead of crucial US jobs data due later Friday. Shares in Australia and South Korea rose alongside Hong Kong futures, while markets in Japan and mainland China are closed for holidays. The S&P 500 advanced 0.9% and the tech-heavy Nasdaq 100 climbed 1.3% on Thursday, only to strengthen further in futures trading following better-than-estimated results from Apple Inc.

  2. Yen Volatility Threatens to Derail One of the Year’s Best Trades

    (Bloomberg) — Japan is threatening to derail one of the most profitable currencies bets this year: carry trades borrowing the yen to invest in emerging-market currencies. A gauge of yen volatility jumped to the highest level since July this week as Japanese officials were suspected to have twice intervened to prop up the besieged currency.

  3. Oil Set for Biggest Weekly Drop Since February on Demand Worries

    (Bloomberg) — Oil headed for its biggest weekly decline since February on signs of weakening demand, fuelling speculation that OPEC+ will prolong output cuts to shore up prices. Brent traded below $84 a barrel for a weekly loss of more than 6%, while West Texas Intermediate traded near $79 a barrel.

  4. Turkey Confirms All Trade Halt With Israel Over War in Gaza
    (Bloomberg) — Turkey confirmed it would halt all trade with Israel until the country allows uninterrupted and sufficient flow of humanitarian aid to Gaza, after two officials familiar with the matter said the pause went into effect earlier Thursday. Turkey decided to expand last month’s restriction on some Turkish exports to Israel due to the “worsening humanitarian tragedy in Palestine,” the Trade Ministry said in a statement, adding that work was underway to make sure that Palestinians were not adversely affected.

  5. World Economy Looks to Dodge Stagflation Rut as Outlook Perks Up
    (Bloomberg) — The world’s economic outlook is perking up as growth proves more resilient and inflation is set to cool faster than previously expected in many countries, the OECD said. While conflicts in the Middle East or more persistent price increases could still knock the economy from its more stable footing.

  6. Biden Touts Infrastructure Funds in Bid to Flip North Carolina

    (Bloomberg) — President Joe Biden lambasted Republicans who opposed his signature infrastructure law that is funding lead-pipe removal in North Carolina, as he seeks to make a long-shot play for the battleground state. Biden’s third trip to North Carolina this year is bolstering his campaign’s push to compete in the traditionally red state that Republican Donald Trump narrowly won in 2020.

  7. FTC’s Surprise Attack on US Oil Icon Rattles Shale Sector

    (Bloomberg) — The Federal Trade Commission’s allegations that shale trailblazer Scott Sheffield tried to collude with OPEC to prop up crude prices is unnerving US oil executives pursuing more than $100 billion in deals. While Thursday’s green light from the FTC for Exxon Mobil Corp.’s $60 billion takeover of Pioneer Natural Resources Co. provided some relief to an industry undergoing unprecedented consolidation, a key condition of the approval is triggering shockwaves.

  8. Tech Lifts Stocks as Apple Jumps in Late Hours: Markets Wrap

    (Bloomberg) — The world’s largest technology companies drove stocks higher, with traders gearing up for Friday’s jobs report. Bonds climbed, while the dollar dropped the most in 2024. In late hours, Apple Inc. climbed after said sales declined less sharply than feared last quarter, helped by stronger-than-expected demand in China.

  9. Blackstone Taps Vast Source of Cash in $1 Trillion Credit Push

    (Bloomberg) — A couple of years ago Clive Cowdery had a problem. The large life insurer that he’d founded was amassing customer cash faster than it could find ways to put that hoard to work. As payments piled up at Resolution Life, two of every three dollars sat idle. The company decided it couldn’t hang around for its in-house crew to scour the globe for the bonds.

  10. Point72’s Drossos Says Japan Disrupting One-Way Bets Against Yen

    (Bloomberg) — By one measure, according to Point72’s Sophia Drossos, Japan’s intervention to prop up the yen has achieved a key objective: Preventing the market from piling into lopsided bets against the currency. The economist and strategist at the asset-management firm said the moves have made investors wary of wagering that the currency will keep weakening.

  11. Glencore Weighs Making Bid for Anglo American, Reuters Says

    (Bloomberg) — Glencore Plc is evaluating a potential bid for Anglo American Plc, a move that could set up a takeover battle with BHP Group Ltd. for the mining company, Reuters reported, citing people it didn’t identify. Glencore has had internal preliminary discussions and those may not lead to the company making an approach to Anglo, Reuters said Thursday.

  12. Novo Nordisk shares fell 2.7%, reversing an earlier gain, after the Danish drugmaker reported first-quarter results that included weaker-than-expected sales for its Wegovy drug. While sales of its Ozempic drug beat expectations, they were helped by US rebate adjustments, according to Jefferies.

    FIRST QUARTER RESULTS: Ebit DKK31.85 billion, +27% y/y, estimate DKK29.04 billion.
    Net income DKK25.41 billion, +28% y/y, estimate DKK23.46 billion. Operating margin 48.7%, estimate 45.2%.
    YEAR FORECAST: Sees sales at constant exchange rates +19% to +27%, saw +18% to +26%, estimate +25.9%. Sees operating profit at constant FX +22% to +30%, saw +21% to +29%, estimate +28.6%.

  13. Standard Chartered jumped 8.8% after the bank delivered a big beat across the board in the first quarter, driven by strong results from its trading and wealth divisions. Morgan Stanley says the update is lifting the stock from low valuation multiples. On the downside, Citi flagged the CET1 ratio was slightly lower than hoped, warning this reduces the chance of a buyback being launched in the second half.

    FIRST QUARTER RESULTS: Adjusted pretax profit $2.13 billion, +25% y/y, estimate $1.55 billion. Pretax profit $1.91 billion, +5.9% y/y, estimate $1.42 billion. Adjusted operating income $5.15 billion, +17% y/y, estimate $4.66 billion. Net interest margin 1.76% vs. 1.63% y/y, estimate 1.74%. Common equity Tier 1 ratio 13.6%, estimate 13.9%. Adjusted RoTE 15.2% vs. 11.9% y/y. COMMENTARY: Stanchart: Maintaining FY 2024 Guidance. Stanchart: Continue to Increase Full-Year Dividend Per Share.

  14. Linde shares dropped 5.2% after the industrial gas company narrowed its adjusted earnings per share forecast for the full year, even as TD Cowen notes the company’s history of beating consensus.

    FIRST QUARTER RESULTS: Adjusted EPS $3.75, estimate $3.66. EPS $3.35. Sales $8.1 billion, -1.1% y/y, estimate $8.4 billion. Adjusted Ebitda $3.12 billion, estimate $3.1 billion. Adjusted operating margin 28.9%, estimate 27.6%. Free cash flow $906 million, -16% y/y, estimate $1.65 billion. SECOND QUARTER FORECAST: Sees adjusted EPS $3.70 to $3.80, estimate $3.80. Sees adjusted EPS +4% to +6%. YEAR FORECAST: Sees adjusted EPS $15.30 to $15.60, saw $15.25 to $15.65, estimate $15.44. Sees adjusted EPS +8% to +10%. Mizuho Securities, John Roberts (buy; PT to $512 from $510): Notes second-half 2024 implied guidance is above consensus. “The weakest markets were metals/mining & heathcare,” which saw flat sales year over year.

  15. Qualcomm shares rose 9.7% after the chipmaker issued a strong third-quarter sales and profit forecast as demand for handsets recovers from a two-year slump. Analysts note robust demand for high-end Android phones, boosting sales for the world’s biggest seller of processors for smartphones.

    SECOND-QUARTER RESULTS: Adjusted EPS $2.44 vs. $2.15 y/y, estimate $2.32. Adjusted revenue $9.39 billion, +1.3% y/y, estimate $9.32 billion. Adjusted operating income $3.18 billion, +6.1% y/y, estimate $3.09 billion. THIRD-QUARTER FORECAST: Sees revenue $8.8 billion to $9.6 billion, estimate $9.08 billion. Sees adjusted EPS $2.15 to $2.35, estimate $2.16. Morgan Stanley analyst Joseph Moore (equal-weight, PT to $172 from $158): Qualcomm posted “strong” quarterly numbers in a “challenging smartphone market”. “Revenue beat reflects strong premium-tier demand for Android smartphones and momentum in automotive”.

  16. Apple Inc. shares rallied 6% in afterhours trading after the company posted stronger-than-expected sales last quarter and predicted a return to growth in the current period, sparking optimism that a slowdown is easing.

    Though revenue fell 4.3% to $90.8 billion in the March quarter, that was better than the $90.3 billion predicted by analysts. Profit also topped Wall Street projections in the period, and Apple announced the biggest stock buyback in US history. The results came as a relief to investors, who have been waiting for the iPhone maker to pull out of a long slump. Apple has posted sales declines in five of the past six quarters, hurt by a sluggish smartphone market and headwinds in China. The company had warned analysts in February that revenue in the latest period would be down about 5% from a year earlier.

  17. Shares of Expedia Group Inc. fell 8.5% afterhours, after the travel-booking platform cut its sales outlook for the year, as efforts to recharge vacation-rental site Vrbo progressed more slowly than expected after a tech-related overhaul.

    “As we enter the second quarter, we are seeing some acceleration in the rest of our B2C business and expect it to continue throughout the year,” Chief Executive Peter Kern said, referring to Expedia’s business-to-customer segment that includes its namesake travel site, Vrbo and “But given the Vrbo drag and the rate of acceleration in B2C thus far, we are lowering our full-year guidance to a range of mid- to high-single-digit top-line growth with margins relatively in line versus last year,” he continued.

  18. Fed and ECB divergence on rate cuts could spell trouble for the euro, economist says

    The European Central Bank is widely expected to cut interest rates next month, barring any major surprises. “The problem of cutting rates right now is that the ECB takes for granted the strength of the euro,” Daniel Lacalle, chief economist at Tressis Gestion, told CNBC on Thursday. “And if they start to cut rates ahead of the Federal Reserve, that is basically giving the world a signal that the euro needs to weaken,” he added.

  19. Sony and Apollo send letter expressing interest in $26 billion Paramount buyout as company mulls Sky dance bid

    Apollo and Sony have sent a letter to the Paramount board expressing formal interest in doing a $26 billion takeover of the company. A Sky dance consortium could hear from a Paramount special committee on a recommendation of next steps as soon as Thursday, according to people familiar with the matter. Some Paramount investors have clamored for the board to engage with Apollo and Sony rather than take the Sky dance deal, because all common shareholders would get a premium for their shares.

  20. Don’t rate Tesla’s Full Self Driving too highly, tech investor says: ‘By no means autonomous driving’

    Mark Hawtin, GAM’s investment director focused on technology, told CNBC expectations surrounding the capabilities of Tesla’s Full Self Driving product in China are misleading. Hawtin said Full Self Driving, or FSD, lacks the qualities that would make it an example of truly “self-driving” technology. “It’s by no means autonomous driving yet,” he told CNBC, adding that FSD is currently already available in the U.S. and U.K.

  21. US Labor Costs Rise by Most in a Year as Productivity Cools

    (Bloomberg) — US labour costs increased in the first quarter by the most in a year as productivity gains slowed, potentially adding to risks inflation will remain elevated. Unit labour costs, or what a business pays employees to produce one unit of output after taking into account changes in productivity, climbed at a 4.7% annual rate.

  22. Cloudflare Inc. reported second-quarter revenue projections that fell short of analysts’ expectations, sending shares down 14.3 % in afterhours trading.

    The company estimated that revenue would total $393.5 million to $394.5 million in the second quarter, with the midpoint of the range missing analysts’ estimates of $394.5 million. The second quarter revenue outlook falling short of expectations sparks concerns about the company’s ability to maintain its current growth rate, Bloomberg Intelligence said in a note. Cloudflare and its peers have faced headwinds in recent months as businesses scaled back IT spending. For Cloudflare, the revenue projection overshadowed what was otherwise a solid beat in first-quarter results for the company. It posted adjusted earnings of 16 cents per share, up from a year earlier and beating analysts’ estimates of 13 cents.

  23. Amgen Inc.’s shares soared 14.6% in afterhours trading after its chief executive officer said he was “very encouraged” by early results from a study of the company’s experimental obesity drug, Mari Tide.

    We recognize the significant interest in obesity,” Amgen CEO Robert Bradway said. “We are confident in Mari Tide’s differentiated profile and believe it will address important unmet medical needs.” The company has emerged as a potential competitor to Eli Lilly & Co. and Novo Nordisk A/S, whose dominance of the weight-loss market so far remains unchallenged. Demand for anti-obesity drugs like Zepbound and Wegovy is so insatiable that Bloomberg Intelligence’s estimate for $80 billion in annual sales by 2030 is now looking conservative, analyst Michael Shah said after Lilly raised its annual forecast earlier this week on demand for the therapies.

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