Morning Reads
- Investors Have Soured on China’s Stocks, Renewing Fears About Economy
- The Fed’s Inflation Fight Faces a New Challenge: A Dry Panama Canal
- Debt-Limit Deal Clears Congress, Ending Threat of US Default
- When Markets Melt Down, These Traders Cash In
- ESG Fund Manager Beats 99% of Peers With Giant Bet on Nvidia
- AI Frenzy Is Driving Record Inflows Into Tech, BofA Says
- Hedge Funds at War for Top Traders Dangle $120 Million Payouts
- Oil Prices Rise After U.S. Debt Deal, All Eyes on OPEC Meeting
- Exxon, Chevron Near Deals to Drill in Gas-Rich Algeria
- Why Your Steak Is Getting Pricier
- What’s Behind All This ‘Shrink’?
- Macy’s and Costco Sound a Warning About the Economy
- Apple Is Stepping Into the Metaverse. Will Anyone Care?
- Netflix Shareholders Vote to Reject Executive Pay Packages
- Meta Tells Office Workers to Come In Three Days per Week This Fall
- Will a Dollar General Ruin a Rural Crossroads?
- Volkswagen Reboots Its Groovy 60s-Era VW Bus. This Time It’s Faster, Roomier and Electric
- Americans Cash In on a Pickleball Obsession
- How Adidas Uncanceled Yeezy
- There’s More Bad News for Disgruntled Bud Light Consumers
Todays Open Interest Change
PREMIUM
Prepper
Apple (NASDAQ:AAPL) is slated to host its Worldwide Developers Conference this week and all expectations are that the tech giant will finally take the wraps off its long-awaited mixed reality headset. The device, which has caused some recent press reports to question Apple's strategy, is likely to be the tech giant's first major product expansion in years, following the 2015 unveiling of the Apple Watch. While the Cupertino, California-based company is likely "well prepared" to bring the device to market, additional time may be given to developers to build apps and features for it.
The leaks: The headset, which could cost as much as $3,000, is likely to be called the Reality Pro or XR Pro, with a new operating system called xrOS. It's expected to launch with both augmented and virtual reality technologies (with an option to switch modes) and have a lightweight design similar to ski goggles. The device also comes with an external battery that can be worn on a person's body, incorporates Apple's processors and Siri, and may even feature an external screen and several external cameras.
Chief Executive Officer Tim Cook said "Yes" to the headset because he believes the long-term survival of the company depends on it, writes Investing Group Leader Trading Places Research. While SA analyst Ash Anderson takes a similar angle, he predicts WWDC might be a "sell the news" event for the tech giant. Today's keynote is scheduled for 1 PM ET, though the annual developer conference is slated to run from June 5 to June 9.
What else to watch: The headset is likely to focus on communication and video, as well as wellness and gaming, but Apple (AAPL) has a number of other announcements in the works. The company is likely to reveal new MacBooks at the event, perhaps showing off a new 15-inch MacBook Air. In addition, Apple is slated to unveil updates to its various operating systems - iOS, iPadOS, macOS, watchOS and tvOS. (65 comments)
Mixed reality
Will the release of Apple's mixed reality headset be the next iPhone moment for the company?
· Yes (this will transform how we do things) · Possibly (let's wait for the details) · Doubt it (too niche of a market) · No way (there's no saving the metaverse)
Take the survey and see the results here
OPEC+ takeaways
Previously warning speculators to "watch out," Saudi Arabia has gone through with additional voluntary cuts of 1M bbl/day of crude oil starting in July. The move would come on top of the 500K bbl/day voluntary cut announced in April, reducing total Saudi production to 9M bbl/day and marking its lowest output level since June 2021. WTI crude futures (CL1:COM) initially rose about 1% to $73/bbl on the news, though the rest of the OPEC+ group confirmed it would keep official production targets unchanged for 2023 and limit combined oil output from January-December 2024. The UAE will get to boost its production next year, coming at the expense of African members who were asked to give up part of their unused quotas. (248 comments)
System resilience
Large U.S. lenders like Morgan Stanley (NYSE:MS) may soon face revised capital rules following the collapse of smaller regional players earlier this year. Overall capital requirements could be raised by about 20% at institutions with at least $100B in assets, compared to the current $250B threshold that regulators currently reserve for their toughest rules. Credit card giants that are heavily dependent on fee income could also be impacted, as well as those involved in investment banking and wealth management. Michael Barr, the Fed's vice chair of supervision, previously hinted at tougher rules in a Congressional hearing last month, while the central bank has also admitted that its supervisors didn't fully appreciate the extent of the vulnerabilities. (31 comments)
Part 2
While the debt ceiling drama that could have put the U.S. in default is now in the rearview mirror, the aftermath could still spell trouble. The Treasury's next move will be to refill the Treasury General Account, or TGA, at the New York Fed, which could lead to a "potent liquidity squeeze." At the same time, the Fed's quantitative tightening, or QT, will go from having no impact so far this year to a big bite. Taken together, the replenishing process could profoundly impact stocks, the economy and even GDP. (48 comments)
Today's Markets
In Asia, Japan +2.2%. Hong Kong +0.8%. China +0.1%. India +0.4%. In Europe, at midday, London +0.5%. Paris -0.1%. Frankfurt flat. Futures at 7:00, Dow +0.1%. S&P flat. Nasdaq -0.3%. Crude +1.6% to $72.88. Gold -0.5% to $1960.20. Bitcoin -1.6% to $26,790. Ten-year Treasury Yield +5 bps to 3.74%
Today's Economic Calendar
9:45 PMI Composite Final 10:00 Factory Orders 10:00 ISM Service Index 12:30 PM Investor Movement Index
Companies reporting earnings today »
What else is happening...
Fitch keeps U.S. on Rating Watch Negative despite debt ceiling deal.
Energy industry says the bill doesn't include enough permitting.
Disney (DIS) taking $1.5B charge tied to pulling streaming content.
Restaurant chain Cava (CAVA) set to start IPO roadshow this week.
NVO and LLY facing increased competition in obesity drug market.
Mixed jobs report doesn't make Fed rate decision any easier.
Real estate investors buy 49% Y/Y fewer homes in Q1 - Redfin.
YouTube (GOOGL) to allow claims of fraud about past elections.
Sony (SONY) CEO downplays cloud gaming risks on console market.
Walmart (WMT) talks AI and international growth at annual meeting