Market overview - forecasts for the economies of the USA, Europe, Britain, corporate news of companies

• The Eurozone economy accelerated to its highest level in a year. The composite PMI rose from 51.7 to 52.3. In the services sector, stability is 53.3. The manufacturing sector has reduced the rate of decline from 45.7 to 47.4 (46.2 was expected - values ​​​​below 50 mean a decline).

Traders are forecasting a 58 basis point cut by the European Central Bank in 2024, down from 67 at the start of the week following key payroll data.

The ECB has long pinned hopes of a rate cut on this important wage measure but has essentially committed to easing policy on June 6, so the new figures are likely to influence policy decisions later in the year.

• The UK economy unexpectedly slowed sharply. The composite PMI fell from 54.1 to 52.8 (54.0 was expected).
Due to the fall in the services sector from 55 to 52.9. And production unexpectedly increased from 49.1 to 51.3.

The Bank of England also has to contend with UK inflation, which slowed less than expected in April. Markets are currently pricing in a 30 basis point rate cut this year, with the Bank of England expected to likely start cutting rates at its September meeting, although markets have not ruled out this happening in August, following the election.

• The US Composite PMI unexpectedly surged to a 25-month high in April. From 51.3 to 54.4 (a decrease to 51.1 was expected). Manufacturing PMI rose from 50 to 50.9. In the services sector from 51.3 to 54.8. And the number of applications for unemployment benefits remains stable. Having fallen from 222 thousand to 215 thousand, the US economy remains strong.
Sales of new homes in the US fell more than expected. From 693 thousand to 634 thousand (677 thousand were expected). The number of permits issued to build new homes fell from 1.467 million to 1.44 million - as expected. The US real estate market is cooling due to high mortgage rates.

As for the Federal Reserve, markets now fully expect a rate cut only in December and are pricing in 36 basis points of easing following strong economic data. As recently as January, markets were pricing in policy easing of as much as 150 basis points this year.

• The US Congress passed the bill. Prohibiting CBDC (central bank digital currency).

• Tesla (TSLA) has ruled out long-term auto sales targets. Previously, there was a plan to sell 20 million cars in 2030. This is actually a good thing - the pursuit of volume in spite of margins has killed many companies. For Apple (AAPL), for example, the main thing is profit.

• Alibaba (BABA) plans to issue $5 billion of convertible bonds. This is negative for current shareholders.

• About 300 Boeing (BA) planes have a potentially fatal defect that could lead to a mid-air explosion - Daily Mail
The planes in question are planes used by carriers UAL and AAL. Boeing shares fell 8%. After the aircraft maker's chief financial officer said free cash flow would be impacted by a lack of recent aircraft deliveries to China.

• OpenAI will use content from the Wall Street Journal, Times and other News Corp. media to train AI. The transaction amount is more than $250 million over 5 years, WSJ reports.

• News Corp. shares. (NWS) jumped after that, but amid the fall of the entire market, they ended the day neutral.

• Investors of Firefly Aerospace, which was owned by Ukrainian businessman Max Polyakov from 2017 to 2022, are considering the possibility of selling the company. The cost of the manufacturer of satellites and lunar ships could be about $1.5 billion, sources told Bloomberg.

• Fashion giant H&M ranks first overall with 4,454 stores in 68 countries last year.
The Swedish company generated $21.6 billion in revenue in 2023, and its largest markets by number of stores were the US, Germany and the UK. The company plans to open 100 new stores in emerging markets this year and close 160 stores in established locations, reducing the number of stores worldwide.

• JPMorgan CEO: The worst outcome for the US economy would be a “stagflation” scenario, in which inflation continues to rise and economic growth slows amid high unemployment.

• The UK economy continues to recover from the mild recession seen at the end of last year. Inflation in the services sector is cooling, which is necessary for the BoE to start cutting interest rates. The PMIs support the view that the BoE will start cutting rates in August.

• SEC head Gensler criticized the bill on the structure of the US crypto market. He said that the proposed bill on the structure of the US cryptocurrency market excludes the definition of digital assets as securities and therefore poses a serious danger to investors.

• Paxos, the issuer of the PayPal stablecoin, announced that it has appointed former Chairman of the US Commodity Futures Trading Commission (CFTC) Christopher Giancarlo to its Board of Directors (he chaired the Commission from 2017 to 2019). The firm said he has invaluable experience and a deep understanding of the market.

• Google has allowed you to share passwords with family members. Google Password Manager now allows you to share passwords with family members, but to a limited extent.

• The Department of Justice will sue Live Nation. Achieving the collapse of the giant selling concerts and tickets. The antitrust lawsuit, expected Thursday, will allege the company illegally stifled competition.

• Elon Musk said Tesla will spend $500 million on a network of charging stations after layoffs - WSJ. The announcement came days after the automaker fired most of the team responsible for building the largest such network in the United States.

• New York offers up to $90 million in tax breaks for news outlets - AP. To recruit and maintain journalists to help keep the declining local news industry afloat.

• JP Morgan upgraded its forecast for China's GDP growth in 2024 from 4.9% to 5.2%.

• Nvidia (NVDA) earnings fueled optimism. Regarding the fact that AI rally has even more opportunities for development. Other chipmakers and artificial intelligence stocks rose on the back of the results: Server maker Dell (DELL) rose 4%, but Super Micro Computer (SCMI) erased early morning gains and fell 3%.

• Shares of cloud analytics company Snowflake's (SNOW) fell 5%. In the wake of an optimistic sales forecast, they initially grew by 4%, but ended the day in the minor.

• The SEC has approved applications from the New York Stock Exchange, Nasdaq and sister exchange Cboe asking for rule changes that would allow them to list spot ETH ETFs. COIN shares are up 2% in premarket trading, while HOOD is up 1%.

• The Fed's Bostic hinted that the US central bank may change its goals, but only after inflation reaches 2%. “If we start moving the goalposts during the game, we will be accused of not taking [the Fed's] mandates seriously. I think it is not in our interests to even entertain such conversations right now. We're going to continue to push for 2%, and when we get to that goal, I think it will be time to talk about what a new goal might look like."

• WDAY shares fall 11% after the report. The company missed revenue expectations but beat earnings forecasts.
The company slightly downgraded its revenue forecast, but improved its operating margin forecast to 25%.

• INTU shares fall 6% after the report. The company raised its forecast for revenue and profit, but showed a decrease in the number of free users from 11+ million to 10+ million. “The era of artificial intelligence is one of the most significant technological shifts in our lives, and our strategy is to become a global expert platform based on artificial intelligence, brings significant benefits to our customers and strong results throughout the company.”

• New ETFs. SPDR Portfolio Treasury ETF SPTB - US government bonds with a remaining maturity of more than one year or equal to it.
Amplify Weight Loss Drug & Treatment ETF THNR - Offers access to companies at the forefront of developing and marketing GLP-1 treatments. GDXY ETF - The objective is to generate income by selling covered calls on the GDX ETF.

• Strong US PMIs and subdued weekly jobless claims data have raised expectations that the Fed may not cut rates this year. As a result, stocks, government bonds, and gold fell in price. Against the backdrop of a strengthening US dollar.

• Today
US Durable Goods Orders Report for April.
University of Michigan Consumer Survey Final Report.