Archive for June, 2024

• Morning News: June 18, 2024
  Eddy Elfenbein, June 18th, 2024 at 7:02 am

  Biden’s Tough-on-China Stance Threatens Green America Push

  Indonesia Can’t Ignore the Cost of Its Battery Metal Boom

  Carbon Removal Fund Backed By Meta, Alphabet Agrees Europe Deal

  The Deadly Mining Complex Powering the EV Revolution

  Waabi Raises $200 Million to Deploy Driverless Trucks by 2025

  Electric-Vehicle Startup Fisker Files for Bankruptcy

  Coke—and Dozens of Others—Pledged to Quit Russia. They’re Still There

  Western Multinationals Fleeing Nigeria Are Being Replaced by Asian and Turkish Firms

  India Regulator Plans Tweaks to Address Derivative Trading Risks

  EU Finance Chief Says Ditch National Symbols to Boost Capital Market

  Central Banks Expect to Snap Up More Gold This Year Amid Dollar Pessimism

  Biden’s Stimulus Juiced the Economy, but Its Political Effects Are Muddled

  Citi Pitches Money-Moving ‘Crown Jewel’ as Central to Revamp

  Goldman Sees US Jobs at Inflection Point, Sticks to Two-Cut Call

  BofA Poll Shows Investors Primed to Fuel Stock Rally With Cash

  JPMorgan’s Latest Fintech Fight Highlights the Pain of Sellers’ Remorse

  Hedge Fund’s Trades With Lenders Point to Return of Crisis-Era Structures

  A Korean Secret to Keeping Friendships Strong: Savings Groups

  Amazon Union Workers Join Forces With the Teamsters

  ‘I Live in Hell’: Anti-Growth Fervor Grips US South After Pandemic Boom

  TikTok Challenges Congress’s Secrecy on Alleged Security Threat

  Apple Scraps Its Buy Now, Pay Later Product. Forget Payments, AI Is the Focus

  Best Buy Trains 30,000 to Handle Microsoft’s AI Laptops Launch

  Bacon Ice Cream and Nugget Overload Sees Misfiring McDonald’s AI Withdrawn

  Boeing’s Bumpy Ride Isn’t Over

  Blackstone to Buy Japanese E-Comic Provider

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• Morning News: June 17, 2024
  Eddy Elfenbein, June 17th, 2024 at 7:03 am

  Berlin Holds Key to Remaining Russia Gas Flows to Europe

  China Property Drag Is Getting Worse, Factory Output Disappoints

  Facing E.V. Tariffs, China Threatens Pork Imports From Europe

  Global Central Banks Recalibrate as the Big Policy Easing of 2024 Fizzles

  Paris Loses Crown as Europe’s Biggest Stock Market to London

  ECB Pays Attention to Good Functioning of Markets, Lagarde Says, After France Spooks Investors

  How the US Mopped Up a Third of Global Capital Flows Since Covid

  Latest Inflation Data Provides Potential for ‘Even Greater Upside’ in the Stock Market Rally

  Top Wall Street Bear Surrenders to Bull Market and Flips Forecast, Now Seeing the S&P 500 Soaring to 6,000 by Year-End

  Hedge Funds’ Secret Weapon to Fight the SEC Lives in Texas

  Trump’s Planned Tariffs Would Tax US Households, Economists Warn

  Momentum Is Still Drawing Magnificent Mojo

  Trailing 97% of Bond Funds, Western’s Flagship Is Losing Cash

  Popular Arbitrage Trade Backfires as TSMC Frenzy Grows in US

  Google DeepMind Shifts From Research Lab to AI Product Factory

  Apple’s Vision for AI Simplicity Highlights Miss by Microsoft

  Surgeon General Calls for Warning Labels on Social Media Platforms

  Inside DOJ’s Wrenching Decision on Whether to Prosecute Boeing

  When Will America Get Its $25,000 Electric Car?

  Stellantis, Champion of Home Work, Asks Engineers Back to Office

  Toyota Investors Challenge Scion’s Grip at a ‘Critical Juncture’

  How A.I. Is Revolutionizing Drug Development

  It Will Take More Than US Bargaining Power to Cut Drug Costs

  US Olympian Shaun White Launches Snowboarding League

  As N.B.A. TV Deal Nears, Warner Bros. Discovery Is on the Outside

  Adidas Investigates Allegations of Bribery in China

  China’s Lust for Durian Is Creating Fortunes in Southeast Asia

  Primo Water, BlueTriton Brands Affiliate to Merge

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• Morning News: June 14, 2024
  Eddy Elfenbein, June 14th, 2024 at 7:02 am

  Gas Markets Brace for Price Spikes During Turbulent Summer

  Global Food Roundup: Farming’s AI Answer and Struggling Startups

  Industrial Policy Balances Politics and the Planet

  BOJ’s Lack of Detail on Bond Buying Cuts Leaves Yen Vulnerable

  Macron Election Call Sends French Markets to Worst Week in Years

  US Money-Market Funds Hit All-Time High of $6.12 Trillion

  Why the Stock Market Has Risen Even With No Fed Rate Cut

  Crypto Titans’ $160 Million War Chest Threatens Senate Democrats

  The Case for Investing in Bitcoin or Gold, or Both

  Former Bank Bailout Watchdog Is Choice to Lead F.D.I.C.

  The Pandemic Felled Dozens of Stellar Credit Ratings. CFOs Want Them Back

  Visa, Mastercard $30 Billion Fee Settlement in Peril

  Courting C.E.O.s, Trump Says He Intends to Cut Corporate Taxes Again

  Does It Pencil?

  F.A.A. Investigating How Counterfeit Titanium Got Into Boeing and Airbus Jets

  Musk Pay Victory Removes Cloud at Tesla, but Fresh Legal Fight Looms

  Tesla Can’t Be All About Elon Musk

  Nice EV You Got There—Can You Afford to Insure It?

  Stellantis Moves Some EV Production Out of China Due to EU Tariffs

  Why Are Shares of Adobe Stock Soaring After Earnings?

  Amazon Has Upended the Streaming Ad Market, and Netflix Is Paying the Price

  Paramount Will Keep Its Family Discount

  Red Lobster Looks to New Wall Street Savior After Prior Woes

  Cava Is Worth $33 Million Per Restaurant After Blistering Debut

  The N.B.A. Sees Its Future in Africa

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• Morning News: June 13, 2024
  Eddy Elfenbein, June 13th, 2024 at 7:06 am

  Deadly and Wildly Profitable, Uranium Fever Breaks Out

  Chinese Trader’s $20 Million Pile of Russian Copper Goes Missing

  G-7 Agree to Tap Frozen Russian Assets for $50B to Ukraine

  China’s Once-Mighty Credit Cycle Is a Fading Force on World Markets

  Why Biden Is Escalating Trump’s China Tariffs

  Taiwan Central Bank Leaves Key Interest Rates Unchanged

  Why Bond Markets Are So Spooked by the French Election

  Bond Market Splits From Fed Again by Betting on 2024 Rate Cuts

  Private Lenders Storm Public Bond Markets at Record-Setting Pace

  Treasury Secretary Yellen Says U.S. Debt Load is in ‘Reasonable Place’ If It Remains at this Level

  Why Investors Don’t Believe the Fed

  Why Big US Banks Are Resisting Bigger ‘Capital Cushions’

  Goldman Sachs Aims to Double Lending to Wealthy Private Bank Clients

  Trump to Pitch Dimon, Fraser as Verdict Fails to Scare Off CEOs

  JPMorgan to Wager on Weight-Loss Craze With $500 Million Fund

  Big Tech Wins Again on Double Whammy Day

  TikTok, Snap Find It’s Not Easy to Keep Young Kids Off the Apps

  Larry Ellison’s Fortune Passes Brin and Ballmer as AI Boosts Oracle

  China’s EV Makers Saw Europe Tariffs Coming, and Many Already Have a Plan

  Tesla Expects to Raise Model 3 Price In Europe Due to EU Tariffs on EVs From China

  Tesla Share Price Is Its Own Referendum on Musk

  Tesla Jumps After Musk Says Shareholders Backed Pay Package

  Elon Musk Allegations Are a Reminder That Harassment Is About Power

  Montana Has More Cows Than People. Why Are Locals Eating Beef From Brazil?

  The Rise and Fall of a $600 Million Strip-Mall Tycoon

  Disney and DeSantis Reach Agreement, Ending Protracted Fight

  HBO Could Use a Hit. Enter the Dragons

  Sony Pictures Acquires Alamo Drafthouse in Lifeline to Cinema Chain

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• Morning News: June 12, 2024
  Eddy Elfenbein, June 12th, 2024 at 7:04 am

  OPEC+ Producers Are Caught Between Diverging Oil Forecasts

  The World Will Be Swimming in Excess Oil by End of This Decade, IEA Says

  G-7 to Call on China to Stop Helping Russia’s War in Ukraine

  EU to Impose Additional Tariffs on EV Imports From China

  Umicore Slashes Guidance After Slower EV Demand Hits Battery-Materials Business

  Uniper Wins $14 Billion Arbitration Ruling Against Gazprom

  Far Right May Irk EU in €500 Billion Investment Push, Scope Says

  FedEx to Lay Off up to 2,000 Employees in Europe Amid Cost-Cutting Efforts

  U.K. Economy Slows, Underlining Government’s Challenges as Elections Loom

  Peso Gets Crushed as Investors Worry Sheinbaum’s Win Was Too Big

  Fed Officials Eye Key Inflation Metric Hours Before Rate Decision

  Biden Nears Pick for Next F.D.I.C. Chair

  JPMorgan Risk Swap Ends Up at a Familiar Place: Rival Banks

  US Money Funds Look Past Reform Angst Thanks to High Rates

  The Tiny Trades That Brought Down Segantii’s Giant Hedge Fund

  GameStop Raises Over $2 Billion After Roaring Kitty Rally

  McKinsey Boss’s Next Big Consulting Project: His Own Firm

  Asia’s Family Office Frenzy Comes With Plenty of Imposters

  Explosive Cases Flow to US Supreme Court from ‘Bold’ Regional Court

  I Spent a Day Down TikTok’s Disinformation Rabbit Hole

  Paramount Can’t Stay Independent Long After Rebuffing Skydance

  Why the Paramount Deal Talks Failed

  Losing a Bridge Upends Life in Baltimore (and It May Soon Get Worse)

  Buyers Snap Up Aging and Empty Office Buildings for Deep Discounts

  More Than 75% of US Hotels Remain Short-Staffed

  The World’s Most Online Male Gymnast Prepares for the Paris Olympics

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• CWS Market Review – June 11, 2024
  Eddy Elfenbein, June 11th, 2024 at 6:17 pm

  (This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

  The S&P 500 Makes Another All-Time High

  The stock market closed today at yet another all-time high. This market has been impressively resilient, especially the growth side. Since May 1, the S&P 500 has gained 7.1%.

  I noticed that shares of Apple popped to a new high today on news that it’s unveiling AI software. These days, all you have to do is mention AI and your stock may double. I’m exaggerating, but not by much.

  

  Not that long ago, the market was looking a lot more fragile. On May 31, the index came close to touching its 50-day moving average but instead of falling through, the market bounced four days in a row.

  Wall Street was helped on Friday by a surprisingly strong jobs report for May. The Labor Department said that the U.S. economy added 272,000 net new jobs last month. That was ahead of Wall Street’s forecast for a gain of 190,000 jobs. For context, the economy added 165,000 new jobs in April.

  So is the economy soaring? Well, not exactly. The jobs report was a mix of good and bad news. The unemployment rate rose to 4.0%. That’s the first time it’s reached that level since January 2022. The labor force participation rate fell 0.2% to 62.5%. The broader U-6 rate stayed the same at 7.4%. In December, the U-6 rate was at 6.5%.

  You can see that a lot of the job gains are really us getting back to the jobs trend that existed before Covid.

  

  There are other areas of concern. For example, the separate household survey showed that the number of full-time jobs fell by 625,000 while part-time jobs rose by 286,000.

  Here are some details:

  Job gains were concentrated in health care, government, and leisure and hospitality, consistent with recent trends. The three sectors respectively added 68,000, 43,000 and 42,000 positions. The three sectors accounted for more than half the gains.

  Other significant growth areas came in professional, scientific and technical services (32,000), social assistance (15,000), and retail (13,000).

  One important bright spot is that average hourly earnings increased by 0.4% last month. That’s good to see. Wall Street had been expecting an increase of 0.3%. Over the last year, average hourly earnings are up by 4.1%. Unfortunately, a lot of that increase has been eaten up by inflation.

  Why Is the Fed Talking About Cutting Rates?

  With the jobs market mostly healthy and the stock market at new highs, why exactly are we talking about the Federal Reserve cutting interest rates? That’s a good question, and the answer is not entirely clear.

  The latest futures prices indicate that Wall Street is about evenly divided on the need for an interest rate cut by September. Not that long ago, a broad consensus assumed that we’d be slashing rates by now. I wouldn’t be surprised to see growing dissention within the Fed.

  Inflation is still above the Fed’s target, but it’s a lot better than it was a year ago. The Fed hasn’t changed rates in nearly a year, and it’s clear that higher rates have had a major impact on the economy.

  We’ll get more important info. tomorrow morning when the June CPI report comes out. Wall Street expects the CPI to have increased by 0.1% last month and the core rate to have increased by 0.3%. Over the last year, Wall Street thinks the CPI rose by 3.4% and the core rate increased by 3.5%.

  The Federal Reserve started its two-day meeting today. The policy statement will be released tomorrow afternoon. Don’t expect to see any change to interest rates. The Fed will also update its economic projections for the next few years (the dot plot).

  

  I’ll be curious to see what the Fed expects for GDP growth for this year. The Q1 GDP report wasn’t so hot, but I don’t know if this was a hiccup or the start of a trend.

  The last time the Fed updated its economic projections, the members saw the need for three rate cuts this year. Spoiler alert: That ain’t gonna last. My guess is that the Fed cut that back to two rate cuts. It seems that getting inflation from 9% to 3% was surprisingly easy but getting it from 3% to 2% is surprisingly difficult. At some point, it might be easiest for the Fed to declare victory and walk away from its 2% inflation target.

  I’ve discussed my concern that the current market rally is too heavily tilted towards growth stocks. That’s not getting any better. If anything, the spread is getting worse. Typically, value stocks do better as interest rates fall, so the recent surge in growth stocks is closely tied to a more reluctant Federal Reserve.

  Value stocks have become widely unloved. I counted 71 stocks within the S&P 500 that have a dividend yield of more than 4%, and that’s not all utilities and REITs.

  Stock Focus: Hawkins Inc.

  As you probably know, I love finding great stocks off the beaten path, especially ones that have done well and are ignored by Wall Street.

  One such company is Hawkins Inc. (HWKN) of Roseville, Minnesota. The company describes itself as a “leading specialty chemical and ingredients” company.

  Snoresville, right? No, Hawkins isn’t the most exciting business, but it’s an important one, and it’s something people need. Hawkins “formulates, distributes, blends, and manufactures products for its Industrial, Water Treatment, and Health & Nutrition customers.”

  Hawkins has been around since 1938. The company has 60 facilities across 27 states. Hawkins has about 950 employees and last year, it generated revenue of $919 million.

  Now for the best part. Since 2000, Hawkins is up by more than 36-fold. The S&P 500 looks like a flat line in comparison. Hawkins has also raised its dividend fairly consistently for nearly 40 years.

  

  You might think that with a track record like that, and a with a market value of nearly $2 billion, Hawkins would grab Wall Street’s attention. That’s not the case. Hawkins is followed by just two analysts. Maybe they should change their name to AI Hawkins?

  That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

  – Eddy

• Morning News: June 11, 2024
  Eddy Elfenbein, June 11th, 2024 at 7:07 am

  Nigeria Confronts Its Worst Economic Crisis in a Generation

  OPEC Keeps Robust Oil-Demand Outlook After Output Policy Move

  Philippines Sees Nuclear as Long-Term Replacement for LNG

  Wall Street Ties to Amazon Depletion Mapped Out in New Report

  ECB’s Lane Says Euro Moves Haven’t Impacted Inflation

  Fed Is in No Rush to Cut Rates as Economy Holds Up

  Fed’s Higher-for-Longer Stance Hits Firms That Expected Rate Cut

  For the Descent, Follow the Dots

  As Supreme Court Decisions Loom, a Legal Assault Is Weakening SEC’s Power

  Alexander Hamilton’s Bank Is Getting a New Name: BNY

  Hedge Funds Pile Into Copycat Quant Trades They Once Derided

  Segantii Insider Case Hinges on a Market-Moving Block Trade

  Food Companies Hope You Won’t Notice Shortages Are Raising Prices

  Foraging on Public Lands Is Becoming More Limited

  First Came ‘Spam.’ Now, With A.I., We’ve Got ‘Slop’

  Apple’s ‘AI for the Rest of Us’ Plan Gets Lukewarm Reaction

  Can Apple Rescue the Vision Pro?

  Nvidia Stock Slips. Why It Didn’t Benefit From an Apple Boost

  Tether to Invest More Than $1 Billion in Deals Over Next Year

  PR Founder-Turned-VC Investor Bucher Raises $150 Million for New Fund

  Budget Computer Maker Raspberry Pi Soars in Opening Trade

  French IT Firm Atos Accepts Rescue Bid From Onepoint Consortium

  GM Authorizes $6 Billion Buyback as It Books Better EV Profits

  Ikea Lost $5,000 When Each Worker Quit. So It Began Paying More

  ‘Anti-Woke’ Shareholders Are Going After Corporate Boards

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• Morning News: June 10, 2024
  Eddy Elfenbein, June 10th, 2024 at 7:05 am

  There’s More to Asia-Middle East Trade Than Oil

  Noble Corp to Buy Diamond Offshore for About $1.6 Billion

  Green Wipeout Means Fights Ahead to Keep Europe’s Climate Goals

  Keeping Sanctioned Russian Timber Out of the EU Is Tricky. This Nonprofit Has a Solution

  Copper Miners Gun for Share of Windfall in Chile

  Ukraine’s Vision of Robot Assassins Shows Need for Binding AI Rules

  The Housing Market Crisis Shows That the Tool The Fed Is Using To Lower Inflation Is Doing The Exact Opposite

  Homeownership Costs in the US Jumped 26% Since Pandemic Began

  Week Ahead for FX, Bonds: Spotlight on U.S. Federal Reserve, Bank of Japan

  How the US is Daring the World to Find a Dollar Alternative

  Americans Really, Really Hate Inflation—and That’s a Big Problem for the Fed

  New York Fed Is Losing Talent and ‘Street Cred’ Under John Williams

  Wall Street Backers See Breakthrough Moment for Carbon Offsets

  As Banking Moves Online, Branch Design Takes Cues From Starbucks

  Julius Baer Targets Rich Indians in Dubai With UBS, JPMorgan Hires

  Don’t Say ‘Elite’: Corporate Firms’ New Pitch Is Meritocracy

  ‘No Clear Deception:’ Chamath Palihapitiya Doesn’t Think Roaring Kitty Rigged GameStop Stock As SEC Rules Don’t Address Influencers’ ‘Outsized Role’

  The Shortcut That Allows Risky Startups to Raise Billions From Rookie Investors

  Unicorns Ruled for a Decade. Tech Needs a New Beast

  Apple’s $471 Billion Rally Hinges on Whether AI Event Delivers

  Can Apple Think Different on A.I.?

  Tesla’s Investor Vote on Elon Musk’s Pay Package Is About More Than His Money

  Airlines Keep Trying to Cut Out the Middleman. Here’s Why It Backfires

  A Big Decision for Boeing’s Next C.E.O.: Is It Time for a New Plane?

  Volvo Car Recalls Its New Electric EX30 Car After Finding Software Glitch

  Scammers Aren’t Just Selling Fake Gucci. They’re Impersonating Small Merchants

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• Morning News: June 7, 2024
  Eddy Elfenbein, June 7th, 2024 at 7:01 am

  Europe’s Fertilizer Producers Sound Alarm Over Big Imports From Russia

  German Trade Surplus Narrows

  Putin’s Wartime Central Banker Tells Him What He Doesn’t Want to Hear

  Russia’s Gain Is Turning Out to Be China’s Pain

  China’s Exports Surge as Trade Tensions Near Boiling Point

  China Conducts Large-Scale Audit Reviews on Biggest Mutual Funds

  India’s Modi, Humbled by Voters, Faces Potent Economic Struggles

  India Central Bank Keeps Rate Unchanged After Election Raises Fiscal Policy Uncertainty

  US Jobs Report Is Set to Confirm a Steady Slowdown Underway

  Markets Poised to Take a Jobs Slowdown in Stride

  Real Estate Investors Are Wiped Out in Bets Fueled by Wall Street Loans

  GameStop Whipsaws on Share Sale Plan Hours Ahead of Gill Stream

  BlueBay Looks to Buy Credit Suisse Debt as EM Loan Bet Pays Off

  Hedge Funds Andurand and Rokos Took Big Copper Bets Before Spike

  Japan Banks to Begin Divesting Their Strategic Toyota Shareholdings

  Trump Tax Cut Renewal Is Winning Wall Street, But Could Cost $4.6 Trillion

  Donald Trump’s Budding Bromance with Tech Moguls

  Is There Room for Common Ground on Congestion Pricing?

  Banks Say Growing Reliance on Big Tech for AI Carries New Risks

  SoftBank Corp. to Build Large-Scale AI Data Center in Osaka

  Saudi Arabia Set to Raise Over $11.2 Billion From Aramco Stock Sale

  Legacy Airlines Are Thriving With Ultracheap Fares, Crushing Budget Carriers

  Wizz Air Weighs Engine Maker for New Airbus Jets Amid Groundings

  The Ads on Your United Airlines In-Flight Screen Are Getting a Lot More Specific

  GM Has a Secret to Help Sell Its New EVs. It’s Costco

  Food Companies Are Still Paying the Price for Years of Inflation

  Big Alcohol’s Monopoly Isn’t Worth Breaking Up

  It’s a Buyer’s Market for Boats, RVs and Other Pandemic Toys

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• Morning News: June 6, 2024
  Eddy Elfenbein, June 6th, 2024 at 7:06 am

  Drought Reduces Zambian Corn Harvest to 14-Year Low

  Billionaire-Friendly Modi Humbled by Indians Who Make $4 a Day

  Trafigura’s Profit Drops 73% as Trading Boom Cycle Fades

  Copper’s Spike Isn’t Justified By Fundamentals, Trafigura Says

  Bank of Canada Cuts Rates to Become First G-7 Central Bank to Ease Policy

  ECB Expected to Announce Interest-Rate Cuts

  The Fed Is Getting Left Behind on Cuts. That’s OK

  U.S. Government Debt Is A Growing Concern

  Americans Have More Investment Income Than Ever Before

  Robinhood Doubles Down on Crypto With Deal for Bitstamp

  ‘Everything Is Not Going to Be OK’ in Private Equity, Apollo’s Co-President Says

  Office Building Losses Start to Pile Up, and More Pain Is Expected

  US Payroll Gains May Be Overstating Labor Market Strength

  AI’s Hidden Workers Are Stuck in Dead-End Jobs

  U.S. Clears Way for Antitrust Inquiries of Nvidia, Microsoft and OpenAI

  Nvidia’s Rise to $3 Trillion Fuels ‘Jensanity’ in Tech World

  Is OpenAI’s Sam Altman the Right Leader for the AI Age?

  Sam Altman Was Bending the World to His Will Long Before OpenAI

  ‘This Is Going to Be Painful’: How a Bold A.I. Device Flopped

  NIO’s First-Quarter Loss Widened on Lower EV Sales

  Bob Kelley, Who Made the Kelley Blue Book an Authority on Cars, Dies at 96

  Why Lululemon’s Stock Is Going Out of Fashion

  The NBA’s Superstar Lull Ignites Challengers to Nike’s Reign

  Five Below Cuts Outlook on Lower Consumer Base Spending Levels

  Remy Martin Sees Tough Year Ahead as U.S. Slowdown Drags On

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