FT : Gates Foundation makes unusual investment in experimental cancer trial

Gates Foundation makes unusual investment in experimental cancer trial
Smart Immune is developing technology it hopes will help patients rebuild their immune systems

The Bill & Melinda Gates Foundation is making an unusual investment in a biotech start-up’s experimental cancer trial, hoping that its novel technology will one day allow HIV patients to rebuild their immune systems.

Smart Immune, a French cell therapy company led by three female co-founders, has developed technology to coax stem cells, which have the ability to develop into many different cell types, into becoming immature “progenitor” T-cells in a lab. These are then injected into the body, where they mature into a crucial part of the immune system and learn to differentiate between normal cells and threats.

These new T-cells mature in less than 100 days, against the 18 months it takes for an immune compromised patient receiving a bone-marrow transplant to rebuild their immune system. They also live for up to a decade in the body, as opposed to the current survival time for injected T-cells of two to six weeks.

The Gates Foundation, which usually focuses on tackling infectious diseases in developing countries, is investing $5mn in Smart Immune to fund an early-stage trial of the technology in leukaemia patients, which aims to rebuild their immune systems after chemotherapy.

Smart Immune also recently received a €17.5mn grant and equity investment from the European Innovation Council.

Chief executive Karine Rossignol said the company was now hoping to raise a series A fund of €50mn to develop its research further.

“Our work in rearming patients’ immune systems is particularly exciting for global health since this concept has application beyond oncology and into infectious diseases such as HIV,” she said.

Marina Cavazzana, Smart Immune’s co-founder, originally developed the technology to help treat “bubble babies”, who are born without an immune system. She said it was a “very, very huge breakthrough”, with an “immense” number of applications.

It could also be used to improve the innovative cancer treatment known as CAR-T, which relies on removing mature T-cells from an individual patient and editing them to attack cancer, by creating an off-the-shelf product that could be used in any patient.

The Gates Foundation is hoping that the technology will eventually allow patients with HIV, which affects 38mn people worldwide, to completely rebuild their immune systems.

A few patients with HIV who have received bone marrow stem cell transplants from HIV resistant donors have gone into remission. Smart Immune’s therapy offers hope that the same effect could be achieved on a large scale, by modifying the cells to be resistant to HIV.

But the therapy would need to be far cheaper and easier to make, particularly if it were to be distributed in developing countries, where the vast majority of HIV patients live. Cavazzana said the company was working to create a small bedside machine that could make it easier to produce the progenitor T-cells without a lab.

“We would like to make this technology affordable and sustainable for all patients that need it. But first of all comes the proof of concept in clinical trials that our claim is correct,” she said.

>>> Rovio - Confirms that it is in discussions with Sega Sammy Holdings Inc. On

Rovio Confirms that it is in discussions with Sega Sammy Holdings Inc.

On February 6, 2023, Rovio Entertainment Corporation (“Rovio”) announced the commencement of a strategic review and preliminary non-binding discussions with certain parties in relation to a potential tender offer for Rovio's shares.

With reference to recent information in the media, Rovio confirms that it is in discussions with Sega Sammy Holdings Inc. (“Sega”) regarding a possible tender offer for Rovio's shares. Rovio and Sega will release further information at an appropriate time. There is no certainty as to when the possible tender offer would take place or whether it would take place at all, nor as to the terms of such potential tender offer.

Rovio does not comment on valuation estimates presented in the media due to the ongoing discussions and there can be no assurance that such estimates would reflect the outcome of the discussions.

WSJ : Merck in Late-Stage Talks to Acquire Prometheus Biosciences

Merck in Late-Stage Talks to Acquire Prometheus Biosciences
The move could give the big drugmaker promising immune disease treatments

Merck MRK -0.23% & Co. is in late-stage talks to acquire Prometheus Biosciences Inc., RXDX 1.02% according to people familiar with the matter, a move that could give the big drugmaker promising immune disease treatments.

A deal for Prometheus could be announced as soon as Sunday, the people said, cautioning the talks could still fall apart.

A price tag for the acquisition would likely carry a significant premium. Prometheus had a market cap of $5.4 billion as of Friday’s market close. Its shares are up about 4% year-to-date.

Merck, of Rahway, N.J., has been looking for deals to add new products to its pipeline. It is expecting its top-selling product, cancer therapy Keytruda, to lose patent protection later this decade, leaving Merck with a potentially major drop in revenue.

Keytruda sales last year totaled roughly $21 billion of Merck’s $59.3 billion total. The drug’s patent is forecast to expire in 2028.

Prometheus, of San Diego, develops immune treatments and doesn’t have any approved products. Its lead pipeline drug is in development for treating immune diseases including ulcerative colitis and Crohn’s disease.

Autoimmune drugs are some of the industry’s biggest sellers and can command high prices, but companies are searching for next-generation products. Some top-sellers such as AbbVie Inc.’s arthritis treatment Humira recently began experiencing their first competition from cheaper versions.

Prometheus recently reported separate positive study results in mid-stage testing of its drug for ulcerative colitis and Crohn’s disease and said it would advance the treatment into late-stage trials.

Company sales totaled $6.8 million last year. SVB Securities LLC analysts forecast that will grow to more than $1.6 billion in 2029.

Merck Chief Executive Robert Davis has said that Merck would be active in deal making this year.

Merck recently agreed to acquire blood-cancer biotech Imago BioSciences for $1.35 billion.

There has been a flurry of M&A activity lately in the sector. Pfizer Inc. earlier this year agreed to pay $43 billion for biotech Seagen Inc. and its pioneering class of targeted cancer drugs. In January, there were a number of deal announcements from mostly smaller European drug companies paying big premiums to fill their pipelines.

Late last year, Amgen Inc. agreed to pay about $28 billion to purchase Horizon Therapeutics PLC, marking the largest healthcare deal of 2022.

Drug companies have been hunting for acquisitions, facing revenue drops as top-selling products lose patent protection. Healthcare companies as a whole are also largely seen as recession-resistant, which has insulated the industry somewhat from fears of an economic slowdown.

FT : Manchester United bidders under pressure to show they can do a deal

Manchester United bidders under pressure to show they can do a deal
Premier League club’s American owners seek higher offers in final round of process

The two final bidders for Manchester United are under pressure to prove they can actually complete a deal should one be struck, with the English Premier League club’s American owners seeking higher offers in the next and final round of the process.

The Glazers are inviting higher offers from the bidders, with British billionaire Sir Jim Ratcliffe and his Ineos industrial empire up against Sheikh Jassim bin Hamad al-Thani, son of a former Qatar prime minister, to buy one of England’s most famous clubs.

Price is the most important of the criteria but bidders will also be assessed on their ability to complete a takeover swiftly, according to two people with knowledge of the process.

Ineos, a representative for Sheikh Jassim, and Raine Group, the merchant bank running the process, declined to comment.

The Glazer family is also considering proposals from a range of investment firms, including Elliott Management, which could result in the family retaining ownership of United. Carlyle Group, which has $376bn in assets under management, has also expressed an interest in investing in the club, according to two people with knowledge of the matter. If Carlyle is involved, a preferred equity deal would be likely, one of the people said.

United is one of the biggest brands in sport, with a fan base spanning the globe. The club has won the English league title a record 20 times, although the last of those victories came in 2013, the season legendary manager Sir Alex Ferguson retired.

A sale could potentially beat the $4.6bn paid by Rob Walton, heir to the Walmart retail fortune, for the Denver Broncos American football franchise last year — a record for a sports team, though private equity billionaire Josh Harris is closing in on a $6bn takeover of US National Football League’s Washington Commanders.

The record for a Premier League club is the £2.5bn paid by US investors Clearlake Capital and Todd Boehly to buy Chelsea FC last year.

Manchester United’s owners have set a deadline of April 28 for final bids. Any change of ownership requires approval from the Premier League.

Ratcliffe’s previous offer valued United at about £5bn, according to two people briefed on the matter. Ineos’s sports portfolio includes French football club OGC Nice, a third of the Mercedes Formula 1 team and the Grenadiers cycling team.

Less is known about his rival Sheikh Jassim, who intends to acquire United through a vehicle called the Nine Two Foundation. A person close to Sheikh Jassim’s bid, whose most recent value has not been disclosed, said the Nine Two Foundation had been established in Qatar. The foundation would disclose more information if it is confirmed as the preferred bidder, the person added.

“There has to be some nervousness in the eyes of Manchester United fans given the scarcity of hard information that exists with regards to the [Nine Two] Foundation,” said Kieran Maguire, a football finance academic at the University of Liverpool and author of The Price of Football.

Jassim’s father, Sheikh Hamad bin Jassim al-Thani, known as HBJ, is also the former head of Qatar’s sovereign wealth fund and one of the richest people in the world.

United shares closed at $22.02 in New York on Friday, up 1.9 per cent over the past week, valuing its equity at about $3.6bn. The club has net debt of about $880mn.

The Glazer family has owned United since a £790mn leveraged buyout led by the late Malcolm Glazer, whose use of debt to fund the acquisition infuriated fans of the club.

FT : The breakdown of French-German relations augurs ill for the EU

The breakdown of French-German relations augurs ill for the EU
Progress on enlargement, the budget and governance will be close to impossible without harmony between Paris and Berlin

The French-German “motor” that has been at the EU’s heart for six decades has broken down. The biggest culprit is the new government in Berlin. Chancellor Olaf Scholz is mostly concerned with the unity of his coalition and Germany’s economy. If he lifts his head to contemplate the world outside Germany, it is usually to gaze across the Atlantic, not towards Paris or Brussels.

For proof, look no further than Scholz’s speech on Europe in Prague last August. The chancellor made only passing reference to France. French president Emmanuel Macron’s speech on Europe at the Sorbonne in 2017 mentioned Germany six times.

Scholz’s biggest problem is that his coalition’s smallest party, the Free Democrats, is fighting for survival, having been kicked out of three state parliaments since the federal election in September 2021. They also risk defeat in elections in Bavaria and Hesse this autumn. They have reverted to first principles — uncompromising positions on Europe, fiscal policy and climate change — to try to claw back support.

Without the liberals, Scholz’s government would fall. He would also be unable to fashion a new majority, given the current array of forces in the Bundestag. This explains the defensiveness of Scholz’s European agenda, and why he withdrew his government’s support for the EU’s combustion engine ban from 2035, although it was considered a done deal in Brussels.

Macron is not free from blame. He has a tendency to go off-script, as shown by his much criticised recent comments on Taiwan. And he can be hypocritical. He complained about German energy-price subsidies after France spent €100bn on subsidies of its own.

The Franco-German duo has had temporary breakdowns in the past. Chancellor Gerhard Schröder and President Jacques Chirac scarcely spoke to one another for several months after a row over EU farm policy in 1999. Chancellor Angela Merkel and presidents Nicolas Sarkozy and François Hollande had poor starts to what eventually became fruitful marriages, on Merkel’s terms, in 2007-2012 and 2012-2017.

But the present chill in relations reflects something more fundamental. Germany’s new power structure seems uninterested or unwilling to think in European terms. Without them, Macron has little hope of realising his vision of a “sovereign” Europe, diplomatically independent of the US without being dependent on China.

The breakdown is already undermining the EU’s agenda in areas such as climate. It casts doubt over the reform of the EU’s fiscal framework, the Stability and Growth Pact, creating less predictability for investors on the sustainability of public finances in Europe’s high-deficit, high-debt economies. It also makes a credible response to the US Inflation Reduction Act less likely, as European Commission president Ursula von der Leyen scrapes the EU budget barrel to fund a collective European response.

Yet it raises more fundamental questions about the EU’s strategic priorities, especially as a new commission takes office after next year’s European parliament elections. The thorniest issues will concern the EU’s enlargement to Ukraine, Moldova and the western Balkans, and the budgetary and governance implications that will follow. Wholesale treaty change seems unavoidable. But making progress on these issues — as well as who in Brussels would be best placed to advance them — will be difficult, if not impossible, without alignment between Paris and Berlin.

Most of the EU’s great achievements in the last six decades were framed jointly by Germany and France or were shaped by Franco-German compromises. The 1957 Treaty of Rome had many founding fathers but would not have happened without a deal between Konrad Adenauer and Charles de Gaulle.

The Single European Act of 1992 was partly the work of that unlikely couple, Jacques Delors and Margaret Thatcher, but would have flopped without Helmut Kohl and François Mitterrand, whose friendship was symbolised by their stroll hand in hand at Verdun in 1984. The euro was in large part created by Kohl and Mitterrand as a counterweight to German unification.

France and Germany cannot — and should not — dominate the EU27 as they did the original six and, to Britain’s discomfort, the nine, 10 and 12. Decisions in Europe should now be a more collective endeavour.

But Berlin and Paris would do well to recognise a fundamental truth. Their relationship is about more than France and Germany. It serves a higher purpose. It is a proving ground — a forge, a laboratory — for what is possible at the EU level. Nothing substantial can happen in Europe unless its two largest economies see eye to eye.

>>> Barron’s Weekend Summary

Barron’s Weekend Summary:

Cover Story:
-Tellus App, founded in 2016, uses social media to advertise its “smart savings platform powered by real estate.” It has made about $100 million worth of loans, according to industry tracker Attom. Tellus says its mortgages are funded using customer deposits. The company has played down the risks it takes with those deposits, Barron’s has found, even as the firm attracts millions in funding from tech-investment heavyweight Andreessen Horowitz and other venture-capital firms. The lack of candor is rare in the world of banking, where federal and state regulations require a strict set of practices around risk and the use of customer funds. But start-ups, many backed by VC firms, have pushed the envelope with their fusions of finance and technology that fall under the buzzy “fintech” banner. These tech-banking mashups largely go unregulated as authorities face the challenge of applying analog-era rules to digital disrupters.

Interview:
-This week, Barron’s interviews Larry Pitkowsky, who in 2011 cofounded GoodHaven, a company that has finally started performing the way its founders imagined. GoodHaven trailed its peers and the S&P 500 from its inception through the end of 2018, as large positions in oil and other commodity-related stocks soured, and bets on turnarounds failed to pay off. Net assets under management at GoodHaven totaled $551M on Aug. 31, 2014. Recently, the fund oversaw just $110M. But, in 2019, GoodHaven reorganized. Pitkowsky became controlling owner and sole portfolio manager, with fellow founder Keith Trauner holding a minority stake, along with Markel goodh the holding company that had helped seed GoodHaven when it launched. Pitkowsky’s plan, laid out in GoodHaven’s 2019 letter to shareholders, was to get back to basics by acknowledging that investing is “not an IQ test,” among other principles.

Tech Trader:
-Tech shares have dramatically outperformed the broader market in 2023, thanks in part to what Meta Platforms CEO Mark Zuckerberg calls “the year of efficiency.” Tech companies have reduced head count and tightened spending in response to weaker revenue growth and a slumping macroeconomic environment. The job cuts have attracted most of the headlines—27,000 at Amazon.com, 21,000 at Meta, 10,000 at Microsoft. But layoffs aren’t the only place where money can be saved. Companies can also spend less in the cloud. The ability to quickly dial up or dial down spending on the cloud is a feature, not a bug—it’s core to the whole premise of cloud computing that users can modulate spending on computing resources as business conditions fluctuate. That flexibility wasn’t possible when companies had to buy servers, storage, and switches and staff their data centers.

The Trader:
-The major indexes finished a listless week not far from where they started, with below-average daily trading volume and declining volatility. The S&P 500 closed up 0.8%, while the Nasdaq Composite gained 0.3% and the Dow Jones Industrial Average added 1.2%. The tone started to change on Friday when JPMorgan Chase, Wells Fargo, and Citigroup reported their first-quarter results, marking the beginning of earnings season for banks big and small. So far, so good—JPMorgan and Citigroup finished the day up 7.6% and 4.8%, respectively. The next few weeks will be chock-full of large and small banks revealing their numbers. The stakes are especially high for small to medium-size institutions following the failures of Silicon Valley Bank and Signature Bank. Many trade at valuations that reflect investor concerns over their long-term viability, explains Spenser Lerner, head of multi-asset solutions at Harbor Capital Advisors.
-Gold is near a record high—and the rally might not stop there. Three related forces are propelling gold toward a record price: economic concerns, lower bond yields, and a weaker US dollar. A boost in buying this year by central banks has added fuel to the rally. The tailwinds look likely to continue. The price of gold settled at $2,041.30 an ounce on Thursday, the second-highest value in history and about half a percentage point below the August 2020 record of $2,069.40. The yellow metal has gained 13% since late February, before Silicon Valley Bank failed. Gold is up more than 25% since November. Other precious metals have rallied even more lately: The price of silver has surged nearly 30% in a month.
There has been a flight to safety among investors in the past month, spurred in part by several high-profile bank failures and concerns about the broader implications for the U.S. financial system. Gold is among the world’s oldest stores of value, and demand tends to increase at times of heightened uncertainty.

Features:
-Life insurance stocks look cheap and inviting and their shares are also; because their finances are sound and the industry has gotten better at risk management. But many life insurance stocks fell more than 10% in March and trade for an average of 7.5 times projected 2023 earnings, among the market’s lowest valuations. Brighthouse Financial and Jackson Financial change hands for less than three times estimated 2023 earnings per share. There are valid reasons for the industry’s depressed valuations, including exposure to commercial real estate, but there are also opportunities to be had. Some of the better life-insurance plays are Equitable Holdings, Corebridge Financial, Globe Life, Primerica, Reinsurance Group of America, Unum Group, and Voya Financial (VOYA). Dividends range from 0.8% for Globe Life to 5.7% for Corebridge. “The life-insurance industry is in a good place,” says Andrew Kligerman, a Credit Suisse insurance analyst. “The companies are sound from a liquidity and capital perspective. Since the financial crisis, the industry has improved its risk-management practices.”
-Tesla stock drops on more price cuts. But investors should focus on something else: the electric-vehicle company’s first-quarter gross profit margins are due to be reported on April 19. Bulls believe price cuts reflect Tesla’s falling costs, while bears believe price cuts are a sign of weakening demand. The April 19 earnings report will be the next chance bulls and bears have to hear from the company about demand and pricing.
Tesla delivered 422,875 units in first quarter, up about 36% year over year. Sales, however, will grow closer to 20% because of the cuts. Investors will be focused on automotive gross profit margins, wrote UBS analyst Patrick Hummel in a research note. Investors expect a number in the 20s. “A miss on this metric would likely trigger a significant negative share price reaction,” added the analyst. He isn’t expecting that, though. Hummel projects 21.5% for first-quarter automotive gross profit margins. He rates Tesla shares a Buy and has a $220 price target.

European Trader:
-Zara’s owner Inditex is looking to the US as an engine for growth. If American shoppers can be tempted to spend more on its fast-fashion outfits, investors should find the shares are a good fit. Inditex’s expansion in the US has been cautious. It only has 101 U.S. stores, having opened its first in New York in 1989. That could change under CEO Oscar Garcia Maceiras, who has been in charge for just over a year. Over the next two years the company plans 30 projects—including new stores, relocations and enlargements—in major American cities. That will include new locations in New York, Boston, Charlotte, Los Angeles, Las Vegas, Dallas, San Antonio and Baton Rouge. The U.S. has become Inditex’s second-biggest market at around 7% to 8% of total revenue with less than 2% of its global store network, due to its strong digital presence, according to Bryan Garnier analysts.

Emerging Markets:
-The Financial System Is Looking Shakier and the IMF is keeping an eye out for potential trouble spots. Risks to financial stability have risen “significantly” amid the recent turmoil in the banking sector, the International Monetary Fund’s economists said on Tuesday, sounding a warning about hidden trouble, not just at banks but also nonbank financial intermediaries.
For several years, the multilateral organization has warned in its Global Financial Stability report of the potential fallout of interest rate rises after an era of historically low rates on banks and nonbank financial intermediaries. Those have come to pass with the trouble at Credit Suisse (ticker: CS) and failures of Silicon Valley Bank and Signature Bank in the US. There could be more pockets of strain but the steps policy makers have taken in recent weeks have contained the situation for now, Tobias Adrian, director of the IMF’s Monetary and Capital Markets Department, said in a press briefing as the IMF and World Bank kicked off their annual spring meetings in Washington. He expects monetary policy to stay focused on inflation, which has proven to be more persistent than expected.

Commodities:
The US. grows roughly one-third of the world’s corn, in the range of 380M metric tons each year. More than 40% of the annual US corn crop is used to make ethanol, a fuel that is mixed with gasoline to achieve desired octane ratings for the gas we use to fill up the tanks in our cars and other vehicles.
Some of that corn demand is at risk by from electric-vehicle adoption, D.A. Davidson analyst Michael Shlisky wrote in a Friday report. As more electric vehicles are sold, less ethanol is needed. So if Tesla gains, corn loses. Tesla remains the global leader in EV sales. Of course, Elon Musk’s company wouldn’t be solely to blame for reduced ethanol demand. Other major auto makers, such as Ford Motor and General Motors, are pushing their businesses toward EVs, and a slew of start-ups are chasing the market as well.

Streetwise:
-This week, Jack Hough talks about what to consider when investing in zing. Zinc ore is typically only 5% to 15% zinc. Miners crush and separate it to make 55% zinc concentrate, which gets sent to smelters, which use high heat to turn it into 99%-plus finished metal. Last year, a smelting bottleneck left zinc ore in a glut and finished-metal prices high. This past week, industry giants raised smelting fees by 19%. That should provide plenty of incentive to ramp up finished zinc output, so analysts consider it a bearish sign for prices. But watch construction in China closely, as much of zinc is used to “galvanize” steel for corrosion resistance. Also, track the war in Ukraine, because smelting is energy-intensive, so any rebound in European energy supplies could revive smelting capacity there.

>>> Weekend Papers Summary

Weekend Papers Summary

NEW YORK TIMES
-Supreme Court briefly preserves broad availability of abortion pill. The temporary stay is meant to preserve the status quo while the justices study lower court rulings, and it did not forecast how they would ultimately rule.
-Virtual Clinics Have Been a Fast-Growing Method of Abortion. That Could Change. So far, most telemedicine providers seem undaunted by court rulings that could imperil their business.
-Airman charged in leak of classified documents. Jack Teixeira, 21, was granted a top-secret security clearance in 2021, which was required for his job, the Justice Department complaint said.
-Teixeira’s case is unusual even in the small world of leak cases.
Based on the charging documents, Airman Jack Teixeira does not appear to have been acting as a foreign agent, differentiating him from classic spying cases. He also does not appear to have been acting as a whistle-blower.
-Mike Pompeo says he won’t run for president in 2024. “This isn’t our moment,” said Mr. Pompeo, a former Trump official. But he declined to endorse the former president and obliquely criticized him.
-Republican 2024 hopefuls embrace gun politics at NRA meeting. Several potential candidates showed strong support for gun owners’ rights — a core issue for the party’s base, but a tougher sell in a general election.
-Biden says he will announce 2024 campaign ‘relatively soon.’ The president, who is widely expected to run again but faces little pressure to imminently announce a formal bid, tiptoed beyond his previous public comments on the subject.
-Six takeaways from Trump’s new financial disclosure. In a 101-page filing, Donald Trump revealed lower-than-expected values on his social media company and sizable bank loans.
-Tech executive was left to ‘slowly die’ after stabbing, prosecutors say.
Bob Lee was killed after what appeared to be an argument with someone he knew, prosecutors said in court documents. Tech Leaders Blamed San Francisco for Bob Lee’s Killing. Then Came the Arrest. Some influential tech executives said Mr. Lee’s death reflected a city overrun by crime, but few have reversed course since the arrest of a man who knew the victim.
-New Yorkers have encountered rodents in toilets, on trains, in bed. And that’s not all.
-Japan’s Prime Minister was safely evacuated after blast. Prime Minister Fumio Kishida was about to give a campaign speech in the western Japanese city of Wakayama when a loud explosion was heard.
-Gov. Kathy Hochul paid $2M for outside help on State of the State Speeches. Hochul hired two big consulting firms as well as outside ghostwriters to help her prepare the annual addresses.
-Missouri to restrict medical care for transgender adults, citing consumer protection law. In his emergency regulation, the state attorney general said it was necessary to put up “substantial guardrails” around gender-transitioning treatments, because they were considered “experimental.”
-Brazil’s President Lula meets Xi in China as they seek path to peace in Ukraine. Brazil has been reluctant about choosing sides in the war, as its new president, Luiz Inácio Lula da Silva, seeks to rebuild the country’s ties with Beijing.
-Sylvester Zottola, a reputed Mafia associate, survived repeated assassination attempts. Eventually, his son Anthony’s plot succeeded.
-Seeking visibility, the Pope’s Commission on Sex Abuse gets a new home. In moving from cramped offices to a palazzo, the organization is aiming for more visibility, and to be better able to welcome victims.

THE FINANCIAL TIMES
-Elon Musk is developing plans to launch a new artificial intelligence start-up to compete with ChatGPT-maker OpenAI, as the billionaire seeks to join Silicon Valley’s race to build generative AI systems. The Tesla and Twitter chief is assembling a team of artificial intelligence researchers and engineers, said people familiar with the tech entrepreneur’s plans.
-Not only did President Macron have little to show from efforts to convince Xi to limit his support for Russia, he created a diplomatic uproar with an interview on the flight home in which he called on Europe to develop its own stance independent of the US to deal with tensions between Beijing and Taiwan. “The great risk” for Europe is that it “gets caught up in crises that are not ours, which prevents it from building its strategic autonomy,” Macron said, warning against becoming “vassals” to the US or China. Politicians, diplomats and analysts on both sides of the Atlantic called the remarks tone-deaf and ill-timed given the US has backed European security by bankrolling Ukraine’s defense.
-China is refusing to let US secretary of state Antony Blinken visit Beijing over concerns that the FBI will release the results of an investigation into the downed suspected Chinese spy balloon. Four people familiar with the negotiations said China had told the US it was not prepared to reschedule a trip that Blinken cancelled in February while it remains unclear what the administration of President Joe Biden will do with the report.
-A 21-year-old Air Guardsman suspected of leaking highly classified US intelligence documents made his first appearance in court on Friday, where he was charged with illegally sharing top-secret national defense information. Jack Teixeira entered the courtroom in handcuffs wearing a tan prison uniform, according to local media. A hearing on his detention will take place next week, said the US attorney for Massachusetts, where the case is being heard.
-Brazilian president Luiz Inácio Lula da Silva has said he wants to work with Beijing to “balance world geopolitics” as he wrapped up a three-day visit to China aimed at deepening relations between the two nations.
“We want to raise the level of the strategic partnership between our countries, expand trade flows and, together with China, balance world geopolitics,” said Lula, who since returning to office for a third term in January has sought to reassert Brazil’s role on the international stage.
-Japanese prime minister Fumio Kishida was evacuated unharmed on Saturday after what appeared to be a smoke bomb was thrown towards him.
According to public broadcaster NHK and government officials, a masked male suspect was arrested at the scene by police at the port of Saikazaki in Wakayama prefecture. Kishida was on the campaign trail ahead of local elections.
-The G7 has privately rebuked Switzerland for not doing enough to combat Russian oligarchs evading sanctions. A letter sent to the Swiss government, signed by G7 ambassadors in Bern on behalf of the group, as well as the EU’s ambassador, said Swiss privacy laws and other “loopholes” were being exploited by Russians to hide billions of francs in offshore assets.
-Hank Paulson caused a stir earlier this year when he wrote an essay in Foreign Affairs magazine with the headline “America’s China policy is not working”. Along with just a handful of other senior US statesmen — notably Henry Kissinger, who will turn 100 next month, and Michael Bloomberg, the former mayor of New York, who is 81 — Paulson is going against the grain of America’s hawkish consensus. Perhaps that is why he is pressing his point so hard.
-JPMorgan Chase and other large US banks on Friday reported bumper profits in the first three months of 2023 as they raked in billions of dollars in deposits from customers fleeing smaller lenders following Silicon Valley Bank’s collapse in March.
-US prosecutors have unsealed drug charges against 28 defendants, including three sons of former Sinaloa cartel leader Joaquin “El Chapo” Guzmán and Chinese chemicals business owners, as Washington intensifies efforts to crack down on the flow of deadly fentanyl.
-It’s really bad. So bad the Pentagon is not only conducting its own investigation, it also immediately called in the Justice Department to investigate. Over 100 pages of highly classified CIA Operations Center and Joint Chiefs of Staff assessments — some intended only for the five eyes intelligence partners, others not releasable to allies at all — have been exposed. Some are derived from human intelligence, so could put assets at risk; many will reveal to US intelligence targets that their communications are compromised.

NY POST
-Bud Light tweets for first time since Dylan Mulvaney controversy: ‘TGIF’ Bud Light fiasco should wake up corporate America to drop all ‘wokery’. Budweiser factories nationwide hit with bomb threats amid Dylan Mulvaney Bud Light fiasco. Don Lemon weighs in on Dylan Mulvaney Bud Light controversy. Anheuser-Busch’s top executive on Friday offered an apology flatter than a day-old Bud Light as the beer giant reels from the backlash over its sponsorship deal with controversial transgender influencer Dylan Mulvaney.
-Best Buy is cutting store jobs across the US as the electronics retailer looks to trim costs and shift its business more towards e-commerce, the Wall Street Journal reported on Friday, citing people familiar with the situation. The layoff would affect hundreds of jobs across Best Buy’s US stores, the report said, adding that the laid off employees could, however, reapply for open positions within the company or receive severance.This week, several store workers who specialize in selling more complex products such as computers and smartphones were told their jobs would be eliminated, the report. added.

WSJ : The World Is Volatile but Luxury Brands Look Serene

The World Is Volatile but Luxury Brands Look Serene
LVMH and Hermès beat high expectations for first-quarter sales

In a world coping with inflation, war and bank runs, it seems counterintuitive that demand for luxury is still running hot.

Yet in recent days, two big designer brands reported bumper first-quarter sales. Paris-listed Hermès RMS 1.52% said its revenue grew 23% from a year earlier in the three months through March, ahead of the 13% analysts were expecting. At LVMH LVMUY -0.13% Moët Hennessy Louis Vuitton—owned by Bernard Arnault, the world’s wealthiest person—sales grew 17% in the same period. This was also much higher than analysts had forecast.

Even before these results, European luxury stocks were on a tear, gaining 23% on average this year compared with a 14% rise in the MSCI Europe index.

Many shareholders see Europe’s luxury brands as a good way to gain exposure to wealthy Chinese consumers, who are keen to shop again after almost three years of pandemic disruption. LVMH said sales in China at fashion brands such as Louis Vuitton, Christian Dior and Celine increased more than 30% in the first quarter compared with a year earlier.

Chinese consumers have accumulated spare cash, which could help to drive sales for the rest of the year. According to Bank of America estimates, in 2022, household deposits in China increased by 7.9 trillion yuan, equivalent to $1.15 trillion at today’s exchange rate—much higher than annual averages of around 2 trillion yuan.

Ultrawealthy consumers are now propping up the luxury-goods industry, with signs of weakness lower down the income ladder. According to Bernstein analysis, people who spent up to 1,000 euros on designer goods in 2019 slashed their budgets in half in 2022. Meanwhile, spending at the top is booming. A wealthy shopper who shelled out around €50,000 in designer shops in 2019 spent €135,000 in 2022.

The luxury industry has been surprisingly resilient in previous economic downturns. In the global financial crisis, the sector had two quarters of lower sales before it began to grow again, while global gross domestic product contracted for four.

But current trends are out of whack with long-term averages and might not be sustainable. In the decade before the pandemic, the luxury sector typically grew at double the rate of global GDP. This year, bullish analysts expect luxury industry sales to increase by 8% to 10% compared with the International Monetary Fund’s 2.8% forecast for global growth. Other pockets of abnormally strong demand seen during the pandemic—such as for rented housing in the U.S.—are beginning to unwind.

It will be harder for luxury brands to flatter their top lines with additional price increases after they hiked aggressively in 2021 and 2022. And unusually generous ad budgets—European luxury-goods companies spent 33% more on marketing in 2022 than a year earlier—might not last either.

Demand is likely to become patchier among brands, so investors should be choosy. Last year, three companies—LVMH, Hermès and Richemont—took home 75% of the industry’s incremental revenue, according to Bank of America analysis. When rivals, including Burberry and Gucci-owner Kering, report their results over the next few weeks, it will become clearer who is winning or losing market share.

Luxury is still shining in a roiled world, but maybe for a narrower selection of brands in the future.