FT : Nvidia could reach $50tn market cap in a decade, says top tech investor

Nvidia could reach $50tn market cap in a decade, says top tech investor
Early Tesla and Amazon backer James Anderson sees chipmaker’s potential scale as ‘way higher than I’ve ever seen’

One of the most successful tech investors said chipmaker Nvidia could be worth almost $50tn in a decade — more than the combined current market value of the entire S&P 500. 

James Anderson, best known for his early bets on the likes of Tesla and Amazon, said: “The potential scale of Nvidia in the most optimistic outcome is both way higher than I’ve ever seen before and could lead to a market cap of double-digit trillions. This isn’t a prediction but a possibility if artificial intelligence works for customers and Nvidia’s lead is intact.” 

Nvidia has been the chief beneficiary of a boom in demand for chips that can train and run powerful generative AI models such as OpenAI’s ChatGPT.

Its shares have surged 162 per cent since the start of the year, pushing the chipmaker’s market value above $3tn — up 20-fold on the roughly $150bn the company was worth in August 2018 when Apple became the first company to reach a trillion-dollar valuation.

Nvidia, whose chief executive Jensen Huang has declared the company is at the centre of a new “industrial revolution”, briefly leapfrogged Microsoft and Apple in June to become the world’s most valuable publicly listed company. 

The company’s “persistent exponential progress, the competitive advantages in hardware and software, and the culture and leadership are exactly what we look for”, said Anderson, who last year teamed up with the holding company of Italy’s Agnelli family to launch Lingotto Investment Management, where he runs a $650bn fund whose largest position is the US chipmaker.


Anderson is best known for the almost four decades he spent at Baillie Gifford. There he ran its flagship Scottish Mortgage Investment Trust, which first bought Nvidia in 2016, and helped turn the Edinburgh-based private partnership into an unlikely star of tech investing.

When Scottish Mortgage initiated a position in Nvidia, “it wasn’t clear what would be the main driver — we didn’t decide if it would be gaming, crypto, autonomous driving or AI but left it to the course of events”, said Anderson.

He added that the big difference between the semiconductor manufacturer and some of his other successful bets is that “Amazon, Tesla etc didn’t start from highly profitable and dominant positions but had to get there”.

A crucial influence on Anderson and Baillie Gifford’s investment process has been academic Hendrik Bessembinder, who found that over many decades just 4 per cent of stocks accounted for all the net wealth creation — providing the basis for their belief that fund managers should seek to identify companies that are extreme winners. 

Anderson outlined why Nvidia falls into this category in a letter to investors this year. 

He wrote that real growth in data centre AI chip demand appeared to be running at about 60 per cent a year. Looking ahead over the next decade, he said 10 years of 60 per cent growth in data centre revenue alone and with unchanged margins would translate into earnings of $1,350 per share and free cash flow of about $1,000 a share. Assuming a 5 per cent free cash flow yield, an Nvidia share might be worth $20,000 in 10 years, which translates to a market capitalisation of $49tn. Anderson put the probability of this type of outcome at 10-15 per cent.

The current combined market capitalisation of all the companies in the S&P 500 is roughly $47tn.

“It is the long duration of the development of GPU usage in AI — and not just AI — from excitement, through potential pauses, to transformation of industries that is most important to us,” said Anderson.

He added that the path was likely to be volatile and that he would not be surprised if Nvidia had one or more drawdowns of 35-40 per cent — “that’s what happens and I hope we’d buy more in that event”.

Nvidia currently trades at more than 47 times its estimated earnings per share for the coming year and is responsible for almost 30 per cent of the S&P 500’s 17.7 per cent gain this year.

The growing sway of Nvidia and the largest tech “megacaps” over broader stock market indices has provided challenges for fund managers who do not hold them. For example, Terry Smith’s global fund lagged behind its benchmark in the first half of the year after choosing to avoid the chipmaker because “we have yet to convince ourselves that its outlook is as predictable as we seek”. 

Addressing the question of whether generative AI has been overhyped, Anderson said “the narrow generative AI for basic and consumer tasks may well be overblown, but we see the big issue as whether it can solve serious problems in 10 years”, including autonomous driving, robotics and drug discovery. “And in that sense it’s the opposite of hype . . . Nvidia is quietly but firmly leading in backing and providing these areas.”

FT : Eskom warns unpaid bills risk new power crisis in South Africa

Eskom warns unpaid bills risk new power crisis in South Africa
Failure by municipalities to pay debts worth billions of rand risks thwarting company’s recovery efforts, utility chief says

Eskom has warned a failure by South African municipalities to pay billions of rand owed to the state-owned power utility is thwarting its recovery efforts just as it is close to ending a decade of blackouts that have hit growth and scared away foreign investors.

“It’s a major risk to our business. In many cases, they can afford it, but haven’t prioritised paying Eskom,” Eskom chief executive Dan Marokane told the Financial Times, adding that a tougher stance from the new government would help it reverse a culture of non-payment from municipalities.

Eskom’s unpaid municipal debt was growing at R15bn ($833mn) annually, Marokane said, threatening to derail its plan to make a profit after a disastrous five years in which it struggled to keep the lights on and made combined losses of R111bn.

The years of blackouts stifled investment, but Eskom says it is turning the tide and recently celebrated 100 days without power outages.

In an effort to kick-start repayments, the utility has launched a case against Johannesburg, Africa’s business hub and wealthiest city, which is refusing to settle nearly R5bn in unpaid power bills.

On June 4, the country’s high court ordered Johannesburg’s City Power to pay R1.1bn to Eskom, which argued that its inability to collect debts “presents a material risk of potentially catastrophic consequences”. The city’s appeal is scheduled to be heard on July 23, Marokane said, speaking on the sidelines of a banking conference in Cape Town.

He warned that if Johannesburg — which contributes 15 per cent to South Africa’s GDP — was allowed to default on its debts, it would send a dangerous signal to less wealthy municipalities.

Marokane, who took up his role in March, said that while Eskom may have previously chosen not to cut power to non-payers for fear of a backlash against the then-ruling African National Congress, “we are not there now — we’re very clear on the steps we need to take”.

Goolam Ballim, chief economist at Standard Bank, said the ANC had for more than a decade bargained on winning votes by allowing voters to get away with not paying for services. But the party lost its majority in May elections for the first time since the end of apartheid 30 years ago.

“This political convenience has run its course,” he said.

Ballim said the new coalition government seemed to have taken a firmer stance on unpaid bills, in a bid to introduce fiscal discipline to a country whose economy has grown at less than 1 per cent a year for a decade.

Kgosientso Ramokgopa, electricity and energy minister and a close ally of President Cyril Ramaphosa, said this week that if the rate of non-payment continued, Eskom would be owed more than R3.1tn by municipalities and individuals by the end of 2050.

“Eskom will collapse . . . this is the most urgent task confronting us,” he told journalists last week.

Ramokgopa said the electricity utility needed the money to invest back into its grid. Eskom confirmed last week that it stood to make a loss of R15bn for the year to March 2024, after making a R23.9bn loss the previous year.

Municipalities owed Eskom R78bn, but Ramokgopa said there was “no possibility under the sun that we are going to collect that amount”.

Large numbers of individual customers also owed Eskom money. While the country has one of the world’s highest unemployment rates, at 32.9 per cent, many people could afford to pay their bills but hoped the debt would be forgiven, Ballim argued.

“The ANC birthed and nurtured this moral hazard and the problem has only swelled, so they’re scrambling to find a way to put the genie back in the bottle,” he said.

With the president in his final term, he said, “if ever there has been an occasion for Ramaphosa to show courage and demand this be fixed, it is now”.

However, despite Ramokgopa’s insistence that the debts are paid, other ANC politicians are sowing confusion by suggesting the opposite. Panyaza Lesufi, premier of Gauteng province, which includes Johannesburg, promised voters before the election that the ANC would cancel historical debts owed to Eskom.

“It’s dangerous for Lesufi to tell people they shouldn’t pay for power. In areas like Soweto [a large township in Johannesburg] . . . only 20 per cent of people paid,” said Nico de Jager, a Gauteng legislator from the Democratic Alliance, the ANC’s principal coalition partner but the main opposition party in the province. “You should pay for what you use.”

Marokane said 72 municipalities had applied to a debt relief scheme launched last year but few had kept to its terms. “Only 4 per cent of those municipalities complied with their obligations . . . So we need to start this conversation about how municipal debts will be tackled sustainably,” he said.

FT : UK could raise more inheritance tax by adopting measures used by G7 peers,

UK could raise more inheritance tax by adopting measures used by G7 peers, says think-tank
Demos report suggests ways for Labour government to make system fairer and generate more funds for public spending

The UK could raise more revenue from inheritance tax and make the system fairer by adopting measures successfully implemented in other countries, according to a report by think-tank Demos.

Research, seen by the Financial Times and due to be published this week, found the UK raised less from inheritance and gift taxes than all but one of the G7 countries that tax inheritance or gifts.

The new Labour government, which is thought to be considering changes to inheritance and capital gains taxes, should take the opportunity to reform the rules on transferring wealth, said Dan Goss, senior researcher at Demos.

“Inheritance tax is definitely the right place to start if the new government is looking to unlock a lot more funds to support its aim for a decade of renewal,” he said.

“Inheritance is becoming increasingly more important and valuable. Doing the reforms now could make a big difference to the country without making much difference to most people.”

Demos’s analysis of OECD data found that only 3.7 per cent of deaths in the UK in 2020-2021 resulted in an inheritance tax charge. This compares with 6.4 per cent of deaths in South Korea and 9.3 per cent of deaths in Japan.


The UK raised less from inheritance and gift taxes in 2022 than the US, Japan, France or Germany. Of the G7 members, it only raised more than Italy — which charges a standard rate of just 3 per cent compared with the UK’s 40 per cent — and Canada, which no longer taxes inheritance or gifts.

The report estimated that if the UK taxed the same proportion of inheritance and gifts as France, it would have raised an extra £680mn in 2019-20, while if it taxed the same proportion as South Korea did in 2022, it would have raised about £14.1bn in 2019-20, £9bn more than the £5.1bn that was actually raised.

The report, titled “The Future of Inheritance Tax”, does not make specific recommendations, but sets out several options it considers the “most promising” — which the Labour government could pursue.

These include reforming the current exemption for business property and replacing the current 40 per cent flat rate of inheritance tax with progressive rates of 20, 40 and 45 per cent, for example, with higher rates applied to the most valuable estates.

“There are ways to make [inheritance tax] fairer and raise more money at the same time,” said Goss. “France, South Korea and Japan, they all have marginal rates that go higher than 40 per cent for the top rate. If you can increase the top rate from 40 to 45 per cent, that could enable quite a big rate cut for smaller inheritances of say under £1mn. That’s a key lesson.”


To increase the popularity of any reforms, additional revenue could be earmarked for specific areas — such as social care or homes for the next generation, Demos said.

Another option for reform would be to remove the capital gains uplift, which has been a part of the UK tax system since the 1970s. It allows the person inheriting an asset to acquire it at the market value on the date of death, rather than the amount originally paid for it, therefore any gains made before death go untaxed.

Goss said that some assets such as agricultural property and business assets benefited from “double” tax relief — inheritance tax exemption plus capital gains uplift — adding it would be a “no brainer” to remove the uplift for assets that were exempt from inheritance tax.

Charging capital gains tax on inherited assets across the board could raise £1.6bn a year in 2024-25, according to research by the Institute for Fiscal Studies and the University of Warwick. The Resolution Foundation has estimated the reform would raise £2bn in 2027-28.

Demos’s report found the UK was one of only three OECD countries to offer uncapped 100 per cent inheritance tax relief for owned businesses, alongside Italy and Poland.

Barrons : Noble’s Largest Investor Buys More Stock

Noble’s Largest Investor Buys More Stock

Noble stock has slumped this year, and the offshore-drilling contractor’s largest shareholder swept in to buy up more shares.

Noble agreed in June to acquire Diamond Offshore Drilling, another contractor for the oil-and-gas industry. The transaction is expected to close by the first quarter of 2025. Noble shares have slipped about 7% year to date.

A unit of A.P. Moller Holding of Copenhagen then paid $13.2 million on July 2 for 300,000 shares, an average price of $44.15. A.P. Moller Holding, itself a subsidiary of the A.P. Moller Foundation, now owns 28.4 million Noble shares, according to a filing A.P. Moeller Holding made with the Securities and Exchange Commission.

A.P. Moeller Holding didn’t respond to a request for comment. Its most recent purchase of Noble stock was on May 22, when A.P. Moeller paid $8.9 million for 192,160 shares, an average price of $46.45 each.

A.P. Moeller Holding remains Noble’s largest shareholder. Before the May and July stock purchases, A.P. Moeller Holding owned 27.9 million Noble shares, a 19.5% stake.

In addition to owning 100% of A.P. Moeller Holding, A.P. Moller Foundation holds 51.45% of the voting power of Danish shipping firm A.P. Moller-Mærsk A/S.

Barrons : Shari Redstone Wins, Shareholders Lose in Paramount-Skydance Deal

Shari Redstone Wins, Shareholders Lose in Paramount-Skydance Deal

Paramount Global’s merger with Skydance Media is proof that you can lose for winning, at least when it comes to big Wall Street deals. Still, shareholders might have no choice but to accept what looks like a bad deal.

With Paramount stock down 20% in 2024 and 75% over the past five years, some investors had been hoping for a deal to cash them out. The terms of the Skydance merger are unlikely to make them happy. National Amusements, led by Paramount Chair Shari Redstone, is getting a far better deal than the bulk of public shareholders, who hold nonvoting Class B shares. Holders of A shares, which have voting rights, are also getting more favorable terms than B holders. And Paramount is paying a stiff price to purchase assets of Skydance, which is leading the deal.

Shareholders won’t even get a chance to OK the merger. The Redstone family’s National Amusements, which controls the company through supervoting Class A stock, accepted a deal that doesn’t allow a vote by holders of B shares, who control about 90% of the struggling media company, even though National Amusements’ economic interest in Paramount is just under 10%. Skydance, which is headed by David Ellison, the son of Oracle founder Larry Ellison, apparently didn’t want such a vote, which is considered to be good corporate governance but might not have led to shareholder approval, given the terms of the transaction.

The deal doesn’t seem all that complicated at first. The holders of the nonvoting Class B shares (ticker: PARA) can elect to receive $15 a share for what will likely be about half their stock. They will keep the rest of their shares. Public holders of voting Class A shares will get $23 a share in cash or 1.53 Class B shares. The cash option is more valuable for both share classes, with the A shares rising 5% to $21.43 so far this week and B shares falling 0.8% to $11.73.

Here’s where it gets complicated. To gain control of Paramount, the Skydance group isn’t buying all the Paramount stock. It’s purchasing National Amusements for $2.4 billion including assumed debt. National Amusements holds 77% of the 41 million Class A shares outstanding, which have voting rights, and 5% of the 626 million nonvoting B shares. When the deal is done, Skydance Media and its partners, including the Ellison family, will end up owning 70% of Paramount stock and 100% of the voting control of the company.

National Amusements owns more than its stake in Paramount, its most valuable asset. It also operates some 759 movie screens in theaters in the U.S. and abroad. The company didn’t break down the price it got for the Paramount stake versus the theaters. And it doesn’t provide financials on the theaters, making it difficult to value them. But if the theaters are worth about $500 million, in line with the valuation of the public Cineplex , the Redstone family got about $30 a share for its Paramount stake, according to Barron’s estimates, or $7 more than other class A shareholders.

Mario Gabelli, whose firm is the largest public holder of Paramount voting shares, wants to know that breakdown, tweeting on X that investors need to know what Skydance paid for National Amusements’ A and B shares. He called this “operation fish bowl.”

Class B shareholders have more to worry about, though. At a recent $11.73, the stock was trading closer to the 52-week low of $9.50 than the high of $17.50, although the stock is above where it stood in early July when reports of a deal surfaced. Financing isn’t an issue given Larry Ellison’s deep pockets, and regulatory problems aren’t expected due to the small size of Skydance. Paramount would buy Skydance for its stock, now worth about $3.7 billion, or over 10 times estimated 2025 earnings before interest, taxes, depreciation, and amortization, or Ebitda.

Investors, though, fear that the B shares will fall to around $8.50 when the deal closes. This is calculated by assuming that investors get $15 a share for half their stock and then solving for what price on the remaining half yields the current stock price of $11.73 ($15 plus $8.50 divided by two is about $11.73). The company will still owe more than $10 billion of net debt, and have limited projected free cash flow in 2025, while continuing to struggle with tough industry trends that should pressure the revenue and profits Paramount generates from its legacy media businesses. Citigroup analyst Jason Bazinet called that implied Paramount price of about $8 a “relatively muted multiple” in a client note but did concede that, at that price, the stock would trade at about six times projected 2025 Ebitda, in line with some media peers. The public float in Paramount will fall by about 50% after the deal, which could benefit investors.

The big issue is why the deal was even needed. National Amusements gets cashed out at a nice price, but the deal for public holders of the nonvoting stock is much less generous and most of any upside will go to Skydance. Analyst Richard Greenfield of Lightshed Partners has argued that Paramount should have stayed independent, cut costs, and sold noncore businesses—BET is reportedly for sale. He called them “easy lifts” that don’t require a sale of the company soon. Once done, the company could have considered a sale in a better condition, he wrote in June.

Shareholders may file suit challenging the deal in Delaware, where Paramount is incorporated. In evaluating the fairness of deals, Delaware courts prefer to see votes by noncontrolling shareholders. Paramount states in its 10-K that in general the class A and B shares “have the same economic rights.” This implies equal treatment in a merger, which isn’t the case here.

There is a so-called go-shop clause on the deal that allows Paramount’s special board committee to consider other offers in the next 45 days, but go-shops rarely result in a winning alternative proposal.

Paramount has been a graveyard for investors in recent years—a classic value trap in which a seemingly cheap stock gets cheaper due to weakening fundamentals. It just might stay that way.

>>> Barron’s Weekend Summary

Barron’s Weekend Summary: Barron's Roundtable, consisting of 11 value-oriented investors, has collected 48 investment picks for the second half of this year and beyond

Cover:
-Barron's Roundtable, consisting of 11 value-oriented investors, has collected 48 investment picks for the second half of this year and beyond. The picks are based on their opinions on how the world has changed since their meeting in January. The investors are not cheering for Nvidia and its ilk to fall, but rather waiting for the rest of the market to rise. The picks include Rajiv Jain, chairman and CIO of GQG Partners; Meryl Witmer, General partner of Eagle Capital Partners; Scott Black, founder and president of Delphi Management; Mario Gabelli, chairman and CEO of Gabelli Funds; Henry Ellenbogen, CIO and managing partner of Durable Capital Partners; David Giroux, CIO of T. Rowe Price Investment Management; Sonal Desai, CIO and portfolio manager of Franklin Templeton Fixed Income; Todd Ahlsten, CIO and lead portfolio manager of Parnassus Core Equity fund; William Priest, portfolio manager of TD Epoch; and John W. Rogers Jr., founder, chairman, co-CEO, and CIO of Ariel Investments.

Interview:
-No update

Tech Trader:
-The increasing pressure to regulate and break up tech companies was a prescient strategy given the ongoing regulatory efforts. Despite press conferences, high-profile hearings, exhaustive reports, investigations, and trials, nothing has happened, indicating that the regulatory process is far from complete.Big Tech remains dominant, with Microsoft, Apple, Amazon, Meta Platforms, and Alphabet making up 25% of the S&P 500. Nvidia, another upstart, makes up 32% of the large-cap index. The Department of Justice's case against Google is likely to rule on in the coming months, potentially forcing Google to change its practices. Google's search business is under threat for the first time in 20 years, with competition from Big Tech firms like Microsoft and start-ups like OpenAI and Perplexity. Any ruling from the court could be obsolete by the time it goes into effect, especially with the long timeline of inevitable appeals.

The Trader:
-The stock market has seen a shift in investor preference, with the Dow Jones Industrial Average up 1.9% and trading at its first record high since May. The S&P 500 index rose 1.3%, while the Nasdaq Composite was up 0.7%. However, the real action was in the equal-weighted S&P 500, which gives American Airlines the same weight as Apple. That index has gained 4.3%, as economically sensitive retail, industrial, materials, and banking sectors surged higher after June's weaker-than-expected consumer price index was released. Markets now anticipate a Federal Reserve interest rate cut in September, which should help extend the current economic expansion, while lower rates help smaller companies disproportionately. Active investors and those who root for the underdog cheered the rotation, as about 80% of the S&P 500's stocks have underperformed the index. However, the celebration is likely to be short-lived, as the late-week action was likely due to a rebalancing by money managers who realized they owned too much tech and not enough of everything else.
-Domino's Pizza, which was upgraded from Baird, has been caught up in a selloff of fast-food names, including McDonald's and Wendy's, which have been falling due to aggressive discounts and higher prices. The weakness has spread to fast-casual restaurants like Chipotle Mexican Grill, CAVA Group, and Domino's. The selloff in the group may be profit-taking after a strong run or something more dire. For Domino's, the drop might have created a buying opportunity. The bull case for Domino's starts with its Hungry for More strategy, which aims to generate profitable sales growth in the coming years by adding new stores worldwide. The company reported 20,755 stores in the first quarter, up 3.7% year over year, as it aims to serve a $94B global market for quick-service pizza.

Features:
-AT&T's stock dropped after it reported a breach of customer data, raising concerns about data security. The company has not found evidence that call and text history information was shared publicly. The investigation suggests that someone unlawfully accessed records of customer call and text from May 1 to October 31, 2022, and January 2, 2023, affecting nearly all of AT&T's wireless customers. The information includes telephone numbers, counts of interactions, and call durations, but does not include the content. AT&T is cooperating with law enforcement and has apprehended one person. The cloud service provider involved was Snowflake, but Snowflake has not identified evidence suggesting the breach was caused by a vulnerability, misconfiguration, or breach of their platform.
-Paramount Global's merger with Skydance Media is a significant deal, but shareholders may have no choice but to accept it. Paramount stock has fallen 20% in 2024 and 75% over the past five years, and some investors were hoping for a deal to cash them out. The terms of the Skydance merger are unlikely to make them happy. National Amusements, led by Paramount Chair Shari Redstone, is getting a far better deal than the bulk of public shareholders, who hold nonvoting Class B shares. Holders of A shares, which have voting rights, are also getting more favorable terms than B holders. Paramount is paying a stiff price to purchase assets of Skydance, which is leading the deal. Shareholders won't even get a chance to OK the merger. The Redstone family's National Amusements accepted a deal that doesn't allow a vote by holders of B shares, who control about 90% of the struggling media company. Skydance, headed by David Ellison, the son of Oracle founder Larry Ellison, apparently didn't want such a vote, which is considered good corporate governance but might not have led to shareholder approval, given the terms of the transaction.

Europe:
-Spotify's stock fell after Redburn Atlantic analyst Agnieszka Pustula warned that expectations for the music-streaming service are too high. Pustula downgraded the stock to Sell from Neutral and gave it a price target of $230, which is substantially lower than the current price above $300. Spotify and its peers have become overvalued, despite impressive growth recently. Pustula also gave rivals Universal Music Group and Warner Music Group a Sell rating. Music streaming faces competitive and structural challenges that will prevent broad-based price increases from becoming a new norm. Other analysts are still bullish on Spotify, with KeyBanc strategists raising their price target to $410 from $400 and Morgan Stanley maintaining its Overweight rating with a $370 price target. Spotify's operating momentum and new audiobook bundle strategy have allowed it to increase prices independently, but its share price discounts too much growth.

Emerging Markets:
-South Africa's political landscape is undergoing a transformation as the African National Congress forms a coalition with the Democratic Alliance. However, asset manager Allan Gray is focusing on the country's electricity supply, which has been uninterrupted for 107 days. This is a significant improvement for 61 million South Africans, who have been affected by the dysfunctional state utility Eskom and the central bank. The central bank has managed to control corruption and looting at power stations. The political signals are also positive, with the Democratic Alliance having six ministries out of 32 in the "government of national unity." Public works and infrastructure minister Dean Macpherson can focus on improving the country's ports and railways, which have hindered its commodities and food exports.

Commodities:
-Presidential contenders Joe Biden and Donald Trump are divided on the steel industry, with Biden focusing on American-owned companies and Trump on increasing tariffs on China. The steel industry is of little importance to the US's service-based economy, but it is crucial to Pennsylvania, which has a better chance of securing the White House for the next four years. Biden won the commonwealth by a small margin in 2020, leading to a bipartisan agreement to protect the industry from low-cost foreign competition. Both candidates have opposed the proposed acquisition of Pittsburgh-based United States Steel by Japan's Nippon Steel. Politics matter more than ever, but maintaining the domestic steel industry comes at a cost, as Ralph Hardt, owner of Belleville International, a precision manufacturer in Butler, Pa., is one potential casualty. Belleville has grown rapidly in recent years, turning tons of stainless steel, other types of steel, titanium, and other metals into parts for various companies.

Streetwise:
-No update this week

>>>

Barron’s Weekend Summary: Barron's Roundtable, consisting of 11 value-oriented investors, has collected 48 investment picks for the second half of this year and beyond


Cover:
-Barron's Roundtable, consisting of 11 value-oriented investors, has collected 48 investment picks for the second half of this year and beyond. The picks are based on their opinions on how the world has changed since their meeting in January. The investors are not cheering for Nvidia and its ilk to fall, but rather waiting for the rest of the market to rise. The picks include Rajiv Jain, chairman and CIO of GQG Partners; Meryl Witmer, General partner of Eagle Capital Partners; Scott Black, founder and president of Delphi Management; Mario Gabelli, chairman and CEO of Gabelli Funds; Henry Ellenbogen, CIO and managing partner of Durable Capital Partners; David Giroux, CIO of T. Rowe Price Investment Management; Sonal Desai, CIO and portfolio manager of Franklin Templeton Fixed Income; Todd Ahlsten, CIO and lead portfolio manager of Parnassus Core Equity fund; William Priest, portfolio manager of TD Epoch; and John W. Rogers Jr., founder, chairman, co-CEO, and CIO of Ariel Investments.

Interview:
-No update

Tech Trader:
-The increasing pressure to regulate and break up tech companies was a prescient strategy given the ongoing regulatory efforts. Despite press conferences, high-profile hearings, exhaustive reports, investigations, and trials, nothing has happened, indicating that the regulatory process is far from complete.Big Tech remains dominant, with Microsoft, Apple, Amazon, Meta Platforms, and Alphabet making up 25% of the S&P 500. Nvidia, another upstart, makes up 32% of the large-cap index. The Department of Justice's case against Google is likely to rule on in the coming months, potentially forcing Google to change its practices. Google's search business is under threat for the first time in 20 years, with competition from Big Tech firms like Microsoft and start-ups like OpenAI and Perplexity. Any ruling from the court could be obsolete by the time it goes into effect, especially with the long timeline of inevitable appeals.

The Trader:
-The stock market has seen a shift in investor preference, with the Dow Jones Industrial Average up 1.9% and trading at its first record high since May. The S&P 500 index rose 1.3%, while the Nasdaq Composite was up 0.7%. However, the real action was in the equal-weighted S&P 500, which gives American Airlines the same weight as Apple. That index has gained 4.3%, as economically sensitive retail, industrial, materials, and banking sectors surged higher after June's weaker-than-expected consumer price index was released. Markets now anticipate a Federal Reserve interest rate cut in September, which should help extend the current economic expansion, while lower rates help smaller companies disproportionately. Active investors and those who root for the underdog cheered the rotation, as about 80% of the S&P 500's stocks have underperformed the index. However, the celebration is likely to be short-lived, as the late-week action was likely due to a rebalancing by money managers who realized they owned too much tech and not enough of everything else.
-Domino's Pizza, which was upgraded from Baird, has been caught up in a selloff of fast-food names, including McDonald's and Wendy's, which have been falling due to aggressive discounts and higher prices. The weakness has spread to fast-casual restaurants like Chipotle Mexican Grill, CAVA Group, and Domino's. The selloff in the group may be profit-taking after a strong run or something more dire. For Domino's, the drop might have created a buying opportunity. The bull case for Domino's starts with its Hungry for More strategy, which aims to generate profitable sales growth in the coming years by adding new stores worldwide. The company reported 20,755 stores in the first quarter, up 3.7% year over year, as it aims to serve a $94B global market for quick-service pizza.

Features:
-AT&T's stock dropped after it reported a breach of customer data, raising concerns about data security. The company has not found evidence that call and text history information was shared publicly. The investigation suggests that someone unlawfully accessed records of customer call and text from May 1 to October 31, 2022, and January 2, 2023, affecting nearly all of AT&T's wireless customers. The information includes telephone numbers, counts of interactions, and call durations, but does not include the content. AT&T is cooperating with law enforcement and has apprehended one person. The cloud service provider involved was Snowflake, but Snowflake has not identified evidence suggesting the breach was caused by a vulnerability, misconfiguration, or breach of their platform.
-Paramount Global's merger with Skydance Media is a significant deal, but shareholders may have no choice but to accept it. Paramount stock has fallen 20% in 2024 and 75% over the past five years, and some investors were hoping for a deal to cash them out. The terms of the Skydance merger are unlikely to make them happy. National Amusements, led by Paramount Chair Shari Redstone, is getting a far better deal than the bulk of public shareholders, who hold nonvoting Class B shares. Holders of A shares, which have voting rights, are also getting more favorable terms than B holders. Paramount is paying a stiff price to purchase assets of Skydance, which is leading the deal. Shareholders won't even get a chance to OK the merger. The Redstone family's National Amusements accepted a deal that doesn't allow a vote by holders of B shares, who control about 90% of the struggling media company. Skydance, headed by David Ellison, the son of Oracle founder Larry Ellison, apparently didn't want such a vote, which is considered good corporate governance but might not have led to shareholder approval, given the terms of the transaction.

Europe:
-Spotify's stock fell after Redburn Atlantic analyst Agnieszka Pustula warned that expectations for the music-streaming service are too high. Pustula downgraded the stock to Sell from Neutral and gave it a price target of $230, which is substantially lower than the current price above $300. Spotify and its peers have become overvalued, despite impressive growth recently. Pustula also gave rivals Universal Music Group and Warner Music Group a Sell rating. Music streaming faces competitive and structural challenges that will prevent broad-based price increases from becoming a new norm. Other analysts are still bullish on Spotify, with KeyBanc strategists raising their price target to $410 from $400 and Morgan Stanley maintaining its Overweight rating with a $370 price target. Spotify's operating momentum and new audiobook bundle strategy have allowed it to increase prices independently, but its share price discounts too much growth.

Emerging Markets:
-South Africa's political landscape is undergoing a transformation as the African National Congress forms a coalition with the Democratic Alliance. However, asset manager Allan Gray is focusing on the country's electricity supply, which has been uninterrupted for 107 days. This is a significant improvement for 61 million South Africans, who have been affected by the dysfunctional state utility Eskom and the central bank. The central bank has managed to control corruption and looting at power stations. The political signals are also positive, with the Democratic Alliance having six ministries out of 32 in the "government of national unity." Public works and infrastructure minister Dean Macpherson can focus on improving the country's ports and railways, which have hindered its commodities and food exports.

Commodities:
-Presidential contenders Joe Biden and Donald Trump are divided on the steel industry, with Biden focusing on American-owned companies and Trump on increasing tariffs on China. The steel industry is of little importance to the US's service-based economy, but it is crucial to Pennsylvania, which has a better chance of securing the White House for the next four years. Biden won the commonwealth by a small margin in 2020, leading to a bipartisan agreement to protect the industry from low-cost foreign competition. Both candidates have opposed the proposed acquisition of Pittsburgh-based United States Steel by Japan's Nippon Steel. Politics matter more than ever, but maintaining the domestic steel industry comes at a cost, as Ralph Hardt, owner of Belleville International, a precision manufacturer in Butler, Pa., is one potential casualty. Belleville has grown rapidly in recent years, turning tons of stainless steel, other types of steel, titanium, and other metals into parts for various companies.

Streetwise:
-No update this week

>>> Weekly Market Update

Weekly Market Update: CPI Solidifies Fed Confidence in Inflation Trajectory

US stocks markets continued to track higher, further into uncharted territory this week. Signals coming from both the corporate sector and the economic calendar highlighted a clear resurgence in disinflationary trends within the economy. Affording Chairman Powell to sharpen his message while appearing on Capitol Hill. By underscoring inflation progress has picked up after disappointing in Q1, and that there are now real risks to both sides of the Fed’s dual mandate, he placed notable emphasis on the considerable cooling seen in the labor market. His demeanor only seemed to solidify market expectations around a September rate cut. Separately, Bank of England’s Pill and Mann both sounded less sanguine on the prospects for imminent UK rate cut allowing the Pound to move up.

Inflation readings out of Norway and China weighed on global bond yields even before US June CPI came in stunningly weak. June CPI figures revealed outright deflation in airfares and used cars along with a long awaited deceleration in shelter costs which resulted in the first negative m/m print since May 2020. Core CPI also missed expectations at 0.1% and the annualized number over the last three months suggest core inflation is running at ~2.2% y/y. The data undoubtedly puts the Fed closer to finally beginning to lower its funds rate, and emboldened those who want to see cuts start as soon as this month. It also resulted in historically choppy and bifurcated trade. On Thursday a clear rotation out of a small number of megacap, technology names into more value oriented small caps resulted in only the second trading day since 1979 that the Russell 2K rose 3%+ while the S&P 500 was down. The US dollar came under broad pressure, and it appeared BOJ officials took that opportunity to intervene on behalf of the Yen. For the week the Dow was up 1.6%, S&P gained 0.9%, NASDAQ rose 0.2% while the Russell 2K surged 6%.

NATO leaders gathered in Washington and affirmed their support for Ukraine. Deals were reached to send additional weapons and equipment to the battle field including F-16 fighters. Moscow again warned of consequences. Former President Trump met with Hungary PM Orban amid reports he would consider plans to cut intelligence sharing with NATO should he be re-elected in November. But the real drama surrounded President Biden who struggled to keep his campaign hopes alive. His end of conference presser went better the debate but failed ally a growing number of Democrats’ beliefs that he should step aside.

Taiwan Semi reported acceleration in June sales this week sparking fresh highs in the SOX and continued enthusiasm in the AI trade. Helen of Troy’s extremely poor quarterly results and slashed guidance was just the first of offer fresh insight into a stretched consumer this week. Delta’s guidance and revenue per seat mile missed market expectations. The CEO noted the industry finds itself in a temporarily oversupplied environment which resulted reduced fares. Pepsico’s top line growth and guidance disappointed as a stretched consumer has clearly pushed back on pricing. Tesla shares came under pressure following a report they were going to delay the highly anticipated robotaxi event from August to October. Friday saw the first spate of major US bank earnings reports. The reception was underwhelming as most had run up into number already. JP Morgan beat while charge offs and provisions were mostly inline with expectations allowing them to affirm their FY outlook. Wells Fargo was forced to guide FY NII to the low end as management talked about weaker than expected loan growth. Citigroup expenses trended towards the upper end of guidance as they have seen consumer payment rates starting to decline while savings taper.

MON 07-08
(CN) CHINA JUNE FOREIGN RESERVES: $3.232T V $3.232T PRIOR (V $3.225TE); Halts gold buying for 2nd straight month
(CN) Follow up: China PBOC expected to Conduct ‘Large-Scale’ Bond Borrowing; Releases details on operations - PBOC-backed Financial News
(DE) Germany Chancellor Scholz: We are relieved by French election results
(EU) EURO ZONE JULY SENTIX INVESTOR CONFIDENCE: -7.3 V -0.5E (back into negative territory; lowest since March)
(FR) French PM Attal offers resignation after Macron party's election defeat and a hung parliament – press
(FR) PRES MACRON DOES NOT ACCEPT FRENCH PM ATTAL RESIGNATION; ASKS HIM TO STAY 'FOR NOW' - PRESS
(FR) One of far-left leaders and former presidential candidate Melenchon: Left-wing New Popular Front will apply all of its program; Refuses any deals with Pres Macron; Macron's PM Attal must go; Macron's defeat is clearly confirmed; Election score is result of magnificent mobilization effort
(FR) FRENCH PARLIAMENTARY SNAP ELECTION (2ND ROUND) OFFICIAL EXIT POLLS; Left-wing Popular Front alliance seen to win 2nd round, But with no absolute majority; Le Pen's Right-wing National Rally party seen to finish only third, getting 110-158 seats
(FR) One of left-wing leaders and socialist politician Faure: Confirms call that Macron's pension reform must be cancelled; We are not prepared for any kind of coalition of the opposites
(IL) Hamas reportedly over the weekend dropped its longstanding demand that Israel promise to end the war as part of any ceasefire deal - press (update)
(JP) JAPAN MAY LABOR CASH EARNINGS Y/Y: 1.9% V 2.1%E
(US) Bloomberg News/Morning Consult poll indicates former Pres Trump leads Pres Biden by only 2ppts (smallest gap since Oct 2023) in key battleground states (1st comprehensive poll in swing states since debates on June 27th)
(US) MAY CONSUMER CREDIT: $11.4B V $8.9BE
(US) Reportedly fast-growing number of Democrats are "praying for and plotting" a more earthly intervention to beg Biden to drop out of the race by Friday, July 12th; Lawmakers from all factions of the party tell Axios that big donors and key constituents have grave concerns about Biden's strength - Axios [**Note: last week, Axios circulated report that one House Democrat said Biden should "step down and help lead a transition of candidacy" and that a "very large majority of the caucus shares this sentiment."]
(US) Reportedly backing of Pres Biden among Hill Democrats, especially inside the House Democratic Caucus, is slipping; There’s been "some extravagant" speculation that Schumer and Jeffries would somehow lead a high-level Democratic delegation to the White House and tell Biden he needs to step aside in favor of VP Harris, but that is all wildly premature - Punchbowl
(UK) UK newly appointed Chancellor of the Exchequer (Fin Min) Reeves: Reiterates pledges Not to raise VAT, National Insurance (NI) and income tax; I have ordered assessment of economic inheritance and will present to parliament before Summer Recess; Our economy has been held by ducked decisions - first major speech since Labour win
AMAT Unveils industry’s first use of ruthenium in high-volume production enables copper chip wiring to be scaled to the 2nm node and beyond and reduces resistance by as much as 25%; Also publicly introduced its latest IMS which combines six different technologies in one high-vacuum system, including an industry-first combination of materials that enables chipmakers to scale copper wiring to the 2nm node and beyond
BA Boeing confirms to plead guilty to criminal conspiracy to defraud the US over two fatal 737 MAX crashes 5 years ago; To be fined $243.6M as part of agreement with DOJ; To invest $455M in safety - US press, citing DOJ official
GLW Raises Q2 core Rev ~$3.6B v $3.4Be ($3.4B prior), EPS at the High End or Slightly Above $0.42-0.46 v $0.45e; Cites strong adoption of new optical connectivity products for Generative AI ‘Springboard’ framework; Began buying back shares in Q2
(US) TTN Research Alert: Goldman Sachs analysts see consensus for Q2 earnings beats set a higher bar than in previous quarters; Consensus expects +9% y/y EPS growth in Q2, which would be the strongest quarterly growth since Q4 2021

TUES 07-09
(CN) CHINA JUNE CPI Y/Y: 0.2% V 0.4%E
(DE) German second-largest Verdi trade union agreed wage hike of ~12.6% for workers in wholesale and foreign trade in Baden-Wuerttemberg (update)
DSY.FR Cuts Q2 Rev €1.50B v €1.55Be (prior €1.53-1.56B); Notes large transaction delays and observed cautiousness in customer signings in a complex geopolitical environment; cuts FY23 guidance
(G7) Saudi Arabia warns G7 against Russia seizures with threat to sell debt - press [**Note: Saudi Arabia holdings of euro and French bonds may amount to tens of billions of euros]
(IE) Ireland Finance Ministry: To introduce €8.3B budget package for 2025; 6.9% proposed increase breaks 5% rule
(US) According to AP-NORC poll, support for legal abortion has risen since Supreme Court eliminated protections - press (update)
(US) Fed Chair Powell: Most recent labor market data sends a signal of cooling; We're well aware of two-sided risks; Won't send signals about timing of future Fed actions today - Q&A
(US) FED CHAIR POWELL: LABOR MARKET CONDITIONS HAVE COOLED, WHILE REMAINING STRONG - PREPARED REMARKS
(US) The Department of Commerce issued a NOI to open a competition for new research and development (R&D) activities that will establish and accelerate domestic capacity for semiconductor advanced packaging anticipating $1.6B in funding across five R&D areas
(US) June Manheim wholesale used vehicle Index: 196.1 v 196.8 prior; --0.06% m/m, -8.9% y/y
005930.KR *Samsung's main South Korea labor union (~30K workers, about 25% of Samsung total): Plans strike for an 'indefinite period' [**Note: prior intent was to be only three days]
MNOD.UK Reportedly in talks with China Copper to form a JV that would allow Nornickel to move its entire copper smelting base to China - press [**Note: would mark Russia's first uprooting of a domestic plant since the U.S. and UK banned metal exchanges from accepting new aluminium, copper and nickel produced by Russia]
HELE Reports Q1 $0.99 v $1.59e, Rev $416.8M v $446Me; Cuts outlook citing "increasingly stretched consumer"; battled an unusual number of internal and external challenges with "many of these challenges became more pronounced toward the end-Q1 and some continue to evolve"
PAGE.UK Q2 Trading update; Q2 Group gross profit £224.3M, -12.0% y/y, Op £60M v £90Me; Exited June -18% y/y; Softening in activity levels through the quarter and macro-economic uncertainty in the majority of its markets

WED 07-10
(NZ) New Zealand sells total NZ$500M vs. NZ$500M indicated in 2029, 2034 and 2037 bonds
(TW) US Top Diplomat in Taiwan: Highlights US commitment to supporting Taiwan's ability to defend itself – statement
(UK) BOE Chief Economist Huw Pill: "When-rather-than-if" characterization of prospective bank rate cuts still seems appropriate, but BOE should remain cautious
(US) Fed Chair Powell: Monetary policy helping bring supply and demand into balance - Semi-Annual testimony
(US) Adobe Analytics June Digital Price Index (DPI) -0.3% m/m v -0.6% prior (update)
(US) Former US Pres Trump said to consider plans to cut US intel sharing with NATO - US press, citing foreign officials informed of Trump's NATO plans
(US) MAY FINAL WHOLESALE INVENTORIES M/M: 0.6% V 0.6% PRELIM
(US) Sen Michael Bennet (D-Colo.): Donald Trump is on track, I think, to win this election and maybe win it by a landslide; Trump could take with him the Senate and the House if he wins in Nov - Axios [**Note: the first Senate Democrat to publicly criticize Biden's bid] (update)
(US) TREASURY'S $39B 10-YEAR NOTE REOPENING DRAWS 4.276% V 4.438% PRIOR; BID-TO-COVER RATIO: 2.58 V 2.67 PRIOR AND 2.48 OVER LAST 8 REOPENINGS
OPEC Monthly Oil Report (MOMR)
TTN Reminder: US share buyback blackout period set to end next week on Fri, July 19th
TTN Research Alert: Yesterday. Fed Chair Powell said most recent labor market data sends a signal of cooling; Ahead of Q2 earnings season start this week, we collected comments made various global firms on current economic conditions
2330.TW Reports June (NT$) Rev 207.9B, +32.9% y/y v +30.1% prior (v 229.6B m/m); Q2 Rev 673.5B v 654.3Be; YTD Rev 1.27T +28% y/y v +27% prior
AA Reports prelim Q2 $0.08-0.19 v -$0.01e, Rev $2.85-2.93B v $2.82Be, adj EBITDA ex-items $310-330M; Reflects "market improvements"
COST Reports June Total SSS +6.9% y/y (ex-gas and FX) v +6.5% prior; US SSS +6.3% (ex-gas and FX) v +5.7% prior; Plans to increase annual membership fees by ~8% (first increase since 2017)
MSFT *Reportedly ditched its non-voting board observer seat at OpenAI amid regulatory concerns; Notes it is not necessary after OpenAI's significant progress and growing customer base; Apple will Not take up observer role on OpeaAI board - press

THRS 07-11
(JP) Reportedly Japan govt and BOJ intervened in FX market for 1st time since early May - press
(JP) Bank of Japan (BOJ) said to have conducted a rate check related to EUR/JPY on Jul 12th, prepping for currency intervention - Nikkei [**Note: Japan markets will be on holiday on Mon, July 15th]
IEA Monthly Oil Report (OMR): Iran’s crude oil production rises to six-year high; China oil consumption contracted in Q2
(SG) SINGAPORE Q2 ADVANCE GDP Q/Q: 0.4% V 0.4%E; Y/Y: 2.9% V 2.7%E
(US) US Pres Biden reiterates he has no plans to leave the race noting his job as President is a proof of mental acuity; Notes VP Harris is qualified to be President; Mistakenly refers to VP Harris as "Vice President Trump" at his first solo Press Conference in 2024
(US) BOFA INSTITUTE: JUNE TOTAL CARD SPENDING -0.5% Y/Y (FIRST DROP SINCE JAN 2024) V +0.7% AVERAGE IN MAY; The weakness was broad based; While softening, there is still some momentum behind consumer spending.
(US) TREASURY $22B 30-YEAR BOND REOPENING DRAWS 4.405% V 4.403% PRIOR; BID TO COVER 2.30 V 2.49 PRIOR AND 2.41 OVER LAST 8 REOPENINGS
(US) Atlanta June Sticky-CPI annualized 2.6% v 2.4% m/m, Core 2.4% v 2.2% m/m (update)
(US) INITIAL JOBLESS CLAIMS: 222K V 235KE; CONTINUING CLAIMS: 1.852M V 1.860ME (1st drop in Continuing Claims in 10 weeks)
(US) JUN CPI M/M: -0.1% V +0.1%E; Y/Y: 3.0% V 3.1%E (1st negative M/M print since May 2020; lowest annual pace since Apr 2021)
(US) Atlanta Fed GDPNow: Raised Q2 GDP forecast to 2.0% from 1.5% (update)
(US) ABC News/Washington Post/Ipsos poll: Biden continues to run evenly with Trump, with no meaningful post-debate change, but two-thirds of Americansm including a majority of Biden’s own supporters, say he should step aside as his party’s presumptive nominee for president given his debate performance two weeks ago
(US) Goldman Sachs analysts: Equity investors are becoming more skeptical about companies that are investing heavily to monetize AI and generate productivity gains
(US) Tier1 week-to-June 27th US Truckload Demand Indicator at 52.8 v 53.1 prior (below 54 avg freight recession level) [**Note: indicator has 81% correlation in leading ISM by a month]
9983.JP Reports Q3 Net ¥116.9B v ¥85.1B y/y, Op ¥144.7B v 110.3B y/y ; Raises FY25 Net ¥365B, Op ¥475B, Rev ¥3.07T
AAPL Settles EU antitrust probe and avoids fine over tap-and-pay tech (as speculated); EU accepts Apple pledge to open up payment tech to rivals - press citing EU's Commission VP Vestager
CAG Reports Q4 $0.61 v $0.56e, Rev $2.91B v $2.94Be; Guides FY25 below estimates; Expects consumers to adapt and establish new reference prices
DAL CEO: Excess supply has led to heavy discounting; What you see happening is the impact in the domestic marketplace to the lower fare discounting that’s been going on this quarter - press interview
DAL Reports Q2 $2.36 v $2.37e, Rev $16.7B v $16.2Be; Guides Q3 well below estimates, but notes peak summer travel demand remains strong ; Announced a 50% increase to dividend payment beginning in Sept quarter;
HAS.UK Issues Q4 Trading Update: Net fees -15% y/y (LFL) with a June exit rate of -18%; Overall, expect near-term market conditions will remain challenging. Activity levels are sequentially stable in ANZ, Asia and the Americas
LIT International Battery Metals reportedly becomes the first company to commercially produce lithium with version of a direct lithium extraction (DLE) technology, a novel type of filtration technology - press
PEP *CEO: US consumer "clearly more challenged, wants more value"; Seeing price sensitive consumers across All income groups - post earnings comments
PFE Advances development of danuglipron, once-daily formulation of Oral GLP-1 Receptor Agonist; Plans to conduct dose optimization studies in 2H24


FRI 07-12
(CN) China Foreign Ministry again sanctions some US military firms and senior executives over Taiwan arms sales - press [**Note: China has already sanctioned and fined many US firms for Taiwan arms sales several times earlier]
(JP) BANK OF JAPAN (BOJ) ACCOUNTS DATA SUGGESTS ~¥3.5T (~$22B) OF FX INTERVENTION ON THURS, JULY 11TH - PRESS
(US) Follow up: Former US Pres Trump meets with Hungary PM Orban at Mar-a-Lago, Florida, post-NATO Summit (Washington DC)
(US) JULY PRELIMINARY UNIVERSITY OF MICHIGAN CONFIDENCE: 66.0 V 68.5E
(US) JUN PPI FINAL DEMAND M/M: 0.2% V 0.1%E; Y/Y: 2.6% V 2.3%E
(IN) INDIA JUN CPI Y/Y: 5.1% V 4.8%E
(US) Tier1 week-to-July 11th US Truckload Demand Indicator for shippers' 0- to 3-month freight demand outlook decreased to 50.0 v 52.8 prior (30-weeks low and well below freight recession average)
BK Reports Q2 $1.51 v $1.43e, Rev $4.60B v $4.54Be
EMSN.CH Reports H1 (CHF) EBIT 291M v 285Me, Net Rev 1.09B v 1.13Be; Cuts Rev outlook citing no sign of any growth impulse in global manufacturing
ERICB.SE Reports Q2 (SEK) adj EBIT 3.23B v 2.69Be, Rev 59.9B v v 58.5Be; Sees market conditions to stay challenging this year
FAST Raises FY24 Capex $235-255M (prior $225-245M v ~$161M y/y); Customer sentiment remains challenging and regional leadership is seeing more layoffs, shift reductions, and planned plant shutdowns - earnings slides
FAST Reports Q2 $0.51 v $0.51e, Rev $1.92B v $1.93Be; Notes customers are consuming less inventory as they adjust production to address soft demand; Experienced modest deflation in its inventory
JPM Affirms FY24 NII ex-CIB markets $91B, adj expense outlook $92B (prior: $91B, adj expense outlook $92B) - earnings slides
JPM Reports Q2 $4.40 adj v $4.19e, Managed Rev $51.0B** v $45.7Be; CEO Dimon reiterates his stance that inflation and interest rates may stay higher than the market expects
LHA.DE Reports prelim Q2 Net €213M v €515M y/y; Cuts FY24 adj EBIT €1.4-1.8B (prior: €2.2B), adj FCF to be significantly below €1B (prior: at least €1B); Notes negative impact from market-related decline in yields in all traffic regions, especially in Asia
T Discloses update on incident from Apr 19th with threat actor accessing call logs and AT&T workspace on a third-party cloud platform; Data does Not contain the content of calls or texts, personal information such as Social Security numbers, dates of birth;. AT&T does not believe that this incident is reasonably likely to materially impact AT&T’s financial condition or results of operations - filing
WFC Reports Q2 $1.33 v $1.27e, Rev $20.7B v $20.3Be; Notes credit performance was consistent with its expectations
X.IPO EU Commission finds X in breach of Digital Services Act; If findings confirmed, X could get fine of up to 6% of total annual Rev – press