Morning Reads

Morning Reads







Google (GOOGGOOGL) is delaying the phaseout of third-party cookies on its browser Chrome for the third time because of regulatory hurdles, and now expects the process to start early next year. "We recognize that there are ongoing challenges related to reconciling divergent feedback from the industry, regulators and developers, and will continue to engage closely with the entire ecosystem," the search giant said. The announcement comes days before quarterly status reports from Google and the U.K.'s Competition and Markets Authority on the phaseout of third-party cookies, which will be replaced by Privacy Sandbox technologies to improve consumer privacy.

Regulatory pushback: The phaseout - which will transform targeted advertising - has attracted regulatory scrutiny over concerns that the move could further boost Google's dominance in the digital advertising market due to increased reliance on first-party data and its advertising platforms. The U.K.'s Information Commissioner's Office last week told the CMA, which is overseeing the phaseout, that Google's plan has gaps that advertisers can exploit. "It's critical that the CMA has sufficient time to review all evidence, including results from industry tests, which the CMA has asked market participants to provide by the end of June," said Google. "We remain committed to engaging closely with the CMA and ICO, and we hope to conclude that process this year."

Delay after delay: The company has spent years preparing for the phaseout, following in the footsteps of Apple (AAPL) and Mozilla, which already have options to block third-party cookies on their browsers. Google even began restricting cookies in January for 1% of Chrome users as part of a limited test. However, it delayed its phaseout deadline twice already since it was originally set in 2020, giving advertisers more time to prepare for the change.

As for the Privacy Sandbox that will replace third-party cookies, advertisers believe the solution is inadequate. "Our findings identify multiple challenges to implementation due to limitations in accomplishing key advertising objectives," Anthony Katsur, CEO, IAB Tech Lab previously said. In response, Google argued that IAB Tech Lab's analysis contained "many misunderstandings and inaccuracies." Adtech names to watch out for: Trade Desk (TTD), Digital Turbine (APPS), AppLovin (APP), Magnite (MGNI), Perion Network (PERI), PubMatic (PUBM), Viant (DSP), Integral Ad Science (IAS), and Innovid (CTV).

Affordability shift

Tesla (TSLA) shot up 13% to $163.96/share AH on Tuesday, despite a sharp drop in Q1 earnings, deliveries, and margins, as investors latched on to the automaker's commitment to launch more affordable models that can be produced on existing production lines. CEO Elon Musk also talked up the latest Full Self-Driving software release, adding that Tesla is in talks with at least one major automaker about licensing FSD. SA analyst Steven Fiorillo said the market is giving Tesla credit for its vision and product roadmap despite its weak quarter. But Investing Group Leader Jonathan Weber warned that Tesla has considerable operational problems while still trading at a premium valuation. (290 comments)

A step closer

A bill that would force ByteDance (BDNCE), the Chinese parent company of TikTok, to sell the social media app or else force a ban in the U.S. passed the Senate Tuesday night. The measure was attached to a larger $95B foreign aid package in support of Ukraine, Israel, and Taiwan. President Biden has voiced his support for the aid package as well as the TikTok measure. If he signs the bill into law, ByteDance would have about nine months to divest the app. If the TikTok bill becomes law, Meta Platforms (META), Google (GOOGGOOGL) and to a lesser extent Snapchat (SNAPstand to gain the most. (10 comments)

Non-compete ban

The Federal Trade Commission has voted to ban for-profit employers from making workers sign contracts with non-compete clauses, which the regulator said kept wages low and hampered innovation. Non-compete clauses ensured that employees couldn't join their employers' rivals or launch competing businesses. FTC Chair Lina Khan said the ban, which will be effective in August, will result in more than 8,500 additional new businesses created each year. The ban "lacks all nuance" and "will expose the trade secrets of American companies and harm investors, including pensions, foundations, and endowments," warned Jennifer Han, chief counsel at trade group MFA. (8 comments)

Today's Markets

In Asia, Japan +2.4%. Hong Kong +2.2%. China +0.8%. India +0.2%.
In Europe,
 at midday, London +0.5%. Paris +0.3%. Frankfurt +0.3%.
Futures at 7:00,
 Dow -0.1%. S&P +0.1%. Nasdaq +0.5%. Crude -0.4% to $83.06. Gold -0.6% to $2,328.40. Bitcoin +0.3% to $66,460.
Ten-year Treasury Yield
 +3 bps to 4.64%.

Today's Economic Calendar

7:00 MBA Mortgage Applications
8:30 Durable Goods
10:30 EIA Petroleum Inventories
11:00 Survey of Business Uncertainty
11:30 Results of $30B, 2-Year FRN Auction
1:00 PM Results of $70B, 5-Year Note Auction

Companies reporting earnings today »

What else is happening...

Slowing economy? PMI Manufacturing slips into negative territory.

Meta Platforms (META) Q1 Preview: Focus on ad sales, AI growth.

Grayscale files to launch lower-fee spot ethereum (ETH-USD) ETF.

Solar woes: SunPower to restate resultsEnphase outlook misses.

Analyst: Apple (AAPL) slices 2024-25 Vision Pro shipment forecast.

HashiCorp (HCP) spikes on report IBM (IBM) nearing deal to buy firm.

GM (GM) delivers 'prove me' quarter as turnaround seems underway.

indie Semiconductor (INDI) spikes before close amid takeover talk.

Goldman: Higher oil prices won’t really have impact on global inflation.

Jamie Dimon: Economy booming, but beware of fiscal dominance.

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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