- Amazon Acquires Globalstar for $11.5B: Amazon has confirmed a definitive agreement to acquire the satellite operator to integrate direct-to-device (D2C) services into its "Amazon Leo" satellite network.
- ASML Beats Estimates, Raises Outlook: The semiconductor equipment giant reported Q1 net sales of €8.8 billion and raised its full-year 2026 revenue guidance to €36–40 billion, driven by intense AI-related demand.
- Bank of America Profits Jump 17%: BofA reported Q1 net income of $8.6 billion ($1.11 EPS), driven by a 9% rise in net interest income and double-digit growth in sales and trading.
- Morgan Stanley Hits Record Revenues: The firm posted record quarterly revenues of $20.6 billion, with its wealth management division attracting over $118 billion in net new assets.
- Bloom Energy Surges 24% on Oracle Deal: Shares of the energy firm jumped after multiple analysts raised price targets following a major AI power deal with Oracle.
- PNC Closes FirstBank Acquisition: Reporting Q1 results, PNC highlighted the successful closure of the FirstBank deal and "strong legacy loan growth" to start the year.
- Hermes Sales Growth Slows: The luxury sector is showing signs of fatigue as Hermes reports a slower recovery path, reflecting broader uncertainty in the high-end market.
Economic Indicators & Geopolitics
- Wholesale Inflation Hits 3-Year High: The U.S. Producer Price Index (PPI) rose 0.5% in March, marking the largest 12-month advance since early 2023, largely due to energy costs.
- IMF Warns of Global Recession Risk: The International Monetary Fund cautioned that a prolonged U.S.-Israel-Iran conflict could trigger a severe downturn if the Strait of Hormuz remains disrupted.
- Trump Hints at Iran Wind-Down: Market optimism rose this morning after President Trump signaled a potential winding down of the Iran conflict, helping to steady global energy prices.
- Oil Prices Steady Near $95: Crude prices nudged slightly lower as investors pinned hopes on U.S.-Iran peace talks scheduled for later this week in Pakistan.
- Bessent Urges Fed Rate Cuts: Treasury Secretary Scott Bessent pushed for the Fed to lower rates while acknowledging the "war clouds" and energy shocks complicating the picture.
Another try: Trump hints at imminent talks with Iran in Pakistan, while the U.S. starts its blockade of Iranian ports.
Contingency plans: Europe eyes Hormuz fix without the U.S.; a fallback plan if the U.S. exits NATO gains traction.
Tariff watch: Bessent says tariffs may be restored by July; U.S. to start accepting tariff refund claims next week.
New highs
Trading desks of Wall Street banks notched new milestones with their first-quarter results, capitalizing on market volatility fueled by the Iran war. JPMorgan Chase (JPM) posted its highest-ever trading revenue for the quarter, while Citigroup (C) saw its best markets revenue in a decade.
Volatility boost: JPMorgan posted better-than-expected Q1 results, driven by growth across its businesses. Its markets revenue jumped 20% Y/Y to a record $11.6B across fixed income and equities. Citi's Q1 earnings also topped estimates, with its markets revenue increasing 19% Y/Y to $7.2B. JPMorgan, Citi and Wells Fargo (WFC) together reported over $25B of profits for the first quarter, as their traders benefited from sharp market moves driven by geopolitical shocks in Venezuela and Iran. Market volatility is good for investment banks as they make money from financing and facilitating client trades.
Consumer strength: Bank executives also discussed consumer behavior in light of the Iran war. Wells Fargo CEO Charles Scharf said consumers are spending more than a year ago, but they haven't slowed spending on everything yet. "We've seen historically that it often takes consumers several months to reduce their spend levels on other categories to adjust for higher oil prices," he noted. "While we don't know the exact timing, we would expect to see the same in the second half of the year." JPMorgan CFO Jeremy Barnum also pointed to a "resilient consumer that's doing just fine." "We've looked to see if there's evidence of people trading, decreasing other discretionary spending to adjust for higher gas prices, but it's just kind of not enough yet to be visible."
Private credit: Banks also disclosed their private credit exposure. Citi's corporate private credit warehouse financing comprises $22B of loans and the portfolio has zero losses over its life. Citi had $762B of loans on its books as of March 31, and less than 1% are to business development companies, which have been hard hit by private credit fears. Wells Fargo's corporate debt finance to financials, excluding bank loans, stood at $36.2B of loans at March 31. About 23% of its exposure is to BDCs as the equity counterparty. By comparison, the bank had total loans of $996B at Q1-end. JPMorgan's Barnum said within the bank's core nonbank financial institution lending, "there's about $50B we would call private credit." That amounts to a tiny amount of the $1.50T of loans on its books.
Here's the latest Seeking Alpha analysis
6 Barbell Stocks: Growth Meets Income For U.S. And Iran Negotiations
Iran: Not Close To Over Yet
I Am Sharing Two Of My Retirement High-Yield Gems
Nebius Is Becoming The Next AI Hyperscaler
Credo: 'Optics Threat' Creates The Kind Of AI Buying Opportunity I Dream Of
What else is happening...
Maine set to be first U.S. state to pass data center moratorium.
Broadcom (AVGO) rises on AI chip deal with Meta (META).
Google (GOOGL) launches upgraded Gemini robotics model.
Tesla (TSLA) eyes Shanghai plant for making humanoid robots.
Microsoft to rent Norway data center site, expand Wyoming ops.
Profitability push: Snap (SNAP) rises as it plans to cut ~1,000 jobs.
Uber (UBER) ramps up robotaxi drive with over $10B commitment.
Nike (NKE) gets lift from insider buys from CEO Hill, Tim Cook.
FDA requires Lilly (LLY) to run post-marketing studies on obesity pill.
Warsh reveals $190M in assets ahead of Fed chair hearing next week.
Today's Markets
In Asia, Japan +0.4%. Hong Kong +0.3%. China flat. India +1.6%.
In Europe, at midday, London -0.1%. Paris -0.8%. Frankfurt -0.1%.
Futures at 6:30, Dow -0.2%. S&P -0.1%. Nasdaq -0.2%. Crude +1.6% to $92.74. Gold -0.7% to $4,816.90. Bitcoin -1% to $73,829.
Ten-year Treasury Yield +1 bp to 4.27%.