Thursday Morning Reads
- Now Investors Owe the Bank.
- China’s Got a New Plan
- Another Grim Tally
- BlackRock Is Now ‘Fourth Branch of Government’
- Coronavirus Shut Down
- While U.S. Economy Slides
- ‘Obscene’ Need for Flour
- Is the Stock Market Overvalued?
- Is the Stock Market Wrong?
- This Is The Next Black Swan
- Old Bears, Young Bulls and Middle Aged Bearistas
- Initial jobless claims dip to 2.5M, now top 39M over eight weeks
- Baidu considering delisting from Nasdaq to boost its valuation
- Big tech has a big problem in D.C.
- Tesla gives anxious Fremont workers an option
- Xtant Medical up big on OrbiMed stake
- AT&T drops '5G Evolution' marketing phrase
- Royal Caribbean called the best play in cruise line sector
- TJX points to strong start with reopened stores
- Amazon plans five new solar projects, first in China
- Aurora Cannabis entering U.S. market acquisition; shares up 19%
- Shakeup at Schlumberger to oversee overhaul
- Starbucks recovery picks up steam
National People's Congress
China's top leaders are descending on Beijing as calls grow for an investigation into the government's handling of the earliest stages of the coronavirus pandemic. About 3,000 delegates to the annual gathering of China's largely rubber-stamp parliament will discuss political and economic policy after GDP contracted in the first quarter for the first time in decades. The meeting is especially of note as it is not yet clear whether "the Chinese economy can recover after this shock, given the expected restructuring of global supply chains," added Minxin Pei of Claremont McKenna College.
Listings at risk
Pressure on Chinese companies is building in the U.S. after the Senate unanimously passed the "The Holding Foreign Companies Accountable Act." Firms like Alibaba (NYSE:BABA) or Baidu (NASDAQ:BIDU) could be forced to give up their listings on American stock exchanges if they fail to comply with the U.S. Public Company Accounting Oversight Board's audits for three years in a row. The law applies to any foreign company listing or raising capital in the U.S., but China earned a specific mention.
Minutes & Powell
Minutes from the Fed's most recent policy meeting detailed a pledge by the central bank to act as "appropriate to support the economy," but also showed an evolving debate over how to signal intentions to keep rates low. One strategy would tie future plans to achieving specific economic outcomes (like the unemployment or inflation rate), while a complementary idea would cap long-term interest rates (think yield-curve control at the BOJ). Keep your eyes on the latest Fedspeak today as Jerome Powell speaks at 2:30 p.m. ET.
Supply deal for coronavirus vaccine
AstraZeneca (NYSE:AZN) has received more than $1B in U.S. funding to develop a COVID-19 vaccine with the University of Oxford and said it has supply agreements for 400M doses. The money came from the U.S. Biomedical Advanced Research and Development Authority, which has also provided funding for French pharmaceutical giant Sanofi (NASDAQ:SNY). AstraZeneca said it has a total capacity sourced for 1B doses through 2020 and into 2021, and continues to increase capacity further.
Next wave of coronavirus disruption?
Additional economic fallout may be seen from the coronavirus pandemic as automation is increased in the retail industry. Gap (NYSE:GPS) is speeding up its rollout of warehouse robots - which aren't susceptible to disease - after reaching a deal to more than triple its fleet to 106 by the fall. "Each machine handles work typically performed by four people," said Kevin Kuntz of global logistics fulfillment. "Our robotics systems, they never get tired. They never take breaks."
Go deeper: Ford forced to idle plants again in Michigan and Illinois.
Japan seeks extradition in Ghosn case
U.S. authorities have arrested former U.S. Army Special Forces soldier, Michael L. Taylor, and his son, who were wanted by Japan on charges that they enabled the escape of former Nissan (OTCPK:NSANY) boss Carlos Ghosn. The cinema-worthy case saw Ghosn, who was charged with financial crimes, sneak onto a private jet in a large box normally used for musical equipment, only to turn up in Lebanon. "While not a party to these extradition proceedings," Nissan said it "reserves the right to take further legal measures as appropriate."
TikTok owner passes $100B private valuation
According to Bloomberg, the valuation of TikTok owner ByteDance (BDNCE) has risen to more than $100B in recent private share transactions, up from $75B during its last funding round two years ago. The sky-high number reflects expectations the company will keep pulling in advertisers despite the coronavirus storm. Some trades recently valued the Chinese company as high as $140B, but the private transactions might not reflect broader investor sentiment.
What else is happening...
New Yorkers should expect higher summer electric bills.
Intel (NASDAQ:INTC) acquires Killer networking company.
Tesla (NASDAQ:TSLA) drops lawsuit against California's Alameda County.
Restoring airline confidence with safety measures.
Bankruptcy odds on Hertz (NYSE:HTZ) tilt higher.
Aurora Cannabis (NYSE:ACB) to enter U.S. market with CBD deal.
Wednesday's Key Earnings
Expedia (NASDAQ:EXPE) +4.4% AH highlighting cost saving measures.
L Brands (NYSE:LB) +0.9% AH despite sales tumbling 37%.
Lowe's (NYSE:LOW) +0.1% on home improvement boom.
Take-Two Interactive (NASDAQ:TTWO) -5% AH missing EPS estimates.
Target (NYSE:TGT) -2.4% as costs outweighed an online surge.
In Asia, Japan -0.2%. Hong Kong -0.5%. China -0.6%. India +0.4%.
In Europe, at midday, London -0.8%. Paris -1%. Frankfurt -1.4%.
Futures at 6:20, Dow -0.8%. S&P -0.8%. Nasdaq -0.8%. Crude +2% to $34.17. Gold -1.1% to $1733.20. Bitcoin -4.3% to $9324.
Ten-year Treasury Yield -1 bps to 0.67%
Today's Economic Calendar
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
9:45 PMI Composite Flash
10:00 Fed's Williams Speech
10:00 Existing Home Sales
10:00 Leading Indicators
10:30 EIA Natural Gas Inventory
1:00 PM Fed’s Clarida: U.S. Economic Outlook and Monetary Policy
2:30 PM Jerome Powell: "Fed Listens: How is COVID-19 Affecting your Community?"
2:30 PM Fed’s Brainard: "Fed Listens: How is COVID-19 Affecting your Community?"
4:30 PM Money Supply
4:30 PM Fed Balance Sheet