Before the Open (May 1-5)

Good morning. Happy Friday.

The Asian/Pacific markets leaned to the downside. Hong Kong did well, but China, India, New Zealand and Indonesia were weak. Europe, Africa and the Middle East are currently mostly up. Turkey is weak, but the UK, Poland, France, Germany, Greece, Russia, South Africa, Finland, Norway, the Netherlands, Italy and Austria are doing well. Futures in the States point towards a moderate gap up open for the cash market.

————— Leavitt Brothers: Open Access —————

The dollar is up. Oil is up; copper is down. Gold and silver are down. Bonds are down.

Stories/News from Seeking Alpha…

Cooling labor market

In the nonfarm payrolls report due to be released at 8:30 AM ET, economists expect that 178K of jobs were added in April, down from the 236K increase in March. While the April estimate is relatively robust, it would be far lower than the average monthly gain of 344K over the previous six months. Generally, the economy needs to add about 100K jobs to absorb new entrants into the workforce (the higher the number of new jobs above that figure, the harder it is for employers to hire as demand outstrips supply).

Snapshot: With the labor market remaining so tight, the Federal Reserve has felt confident in its inflation fight, raising its interest rates without inflicting too much damage on the economy. On Wednesday, the central bank increased its policy rate by another 25 basis points, bringing it to 5.00%-5.25%, the highest level since 2007. Powell also said there were signs that supply and demand in the labor market are starting to come into better balance, but “the labor market remains very tight.”

Another data point to watch will be the unemployment rate, which is expected to tick up to 3.6%, from 3.5% reported in March. Wage growth will also be eyed, with average hourly earnings expected to rise 0.3% M/M in April, unchanged from March. On a Y/Y basis, that comes to a 4.2% increase, the same as in the prior month, while the labor force participation rate will be analyzed for its effects on wage-driven inflation.

Outlook: No doubt the Fed policymakers will parse the report for any signs of reaccelerating wage growth or renewed strength in hiring. “If there is one prime focus of the Fed’s inflation fears, it is the strong labor market,” writes SA contributor Harry Mamaysky. If the U.S. does indeed add 180K jobs in April, it would mark the smallest monthly gain since December 2019, excluding the losses that occurred during the first year of the coronavirus pandemic. (7 comments)

iPhone strength

Apple (AAPL) shares rose 2.5% in AH trading on Thursday after the tech giant reported Q2 results that topped muted analyst expectations, while unveiling a new $90B share buyback program and raising its quarterly dividend. Revenue was helped by iPhone sales and Services, though some weakness was seen in Mac and iPad segments, and overall sales fell for the second quarter in a row. “We expect our June quarter year-over-year revenue performance to be similar to the March quarter, assuming that the macroeconomic outlook does not worsen from what we are projecting today,” Apple CFO Luca Maestri added on a conference call, while CEO Tim Cook said in a follow-up interview that the iPhone maker remains “extremely prudent on hiring… just at a lower clip level than we were before.” (161 comments)

Blueprint for AI

With artificial intelligence in the headlines and fears about what it can do to society, the White House convened a meeting yesterday that sought to explore the dangers to public safety. Vice President Kamala Harris and senior staff met with the CEOs of leading AI companies like Google (GOOG, GOOGL), Microsoft (MSFT), OpenAI and Anthropic. “It was a frank conversation, which included discussion on three main things,” Press Secretary Karine Jean-Pierre said at a press briefing, explaining the requirements needed to ensure AI systems are secure from malicious actors and attacks. The Biden administration previously put out a formal request for comment on potential AI regulation, while stocks continue to move on AI buzz: the latest beneficiary is Advanced Micro Devices (AMD). (23 comments)

Regional bank rout

U.S. federal and state officials are looking into whether “market manipulation” has prompted the recent volatility in banking shares, according to Reuters, with short sellers raking in nearly $380M in paper profits on Thursday alone from betting against regional banks. The brutal selloff saw PacWest (NASDAQ:PACW) and Western Alliance (NYSE:WAL) plunge 51% and 39%, respectively, as investors grew nervous about “strategic options,” as well as the possibility of stockholder wipeout. Others are attributing the drops to self-fulfilling prophecies, though First Horizon (NYSE:FHN) also tumbled after calling off its merger with TD Bank (TD). Meanwhile, billionaire activist investors like Bill Ackman and Nelson Peltz are warning that more regional banks will fail unless deposit rules change, while the FDIC is looking to propose new payments on larger banks to replenish its deposit insurance fund. (18 comments)

Today’s Economic Calendar
8:30 Non-farm payrolls
1:00 PM Baker Hughes Rig Count
1:00 PM Fed’s Bullard: U.S. Economy and Monetary Policy
3:00 PM Consumer Credit

What else is happening…

Gold miners show strength as gold nears all-time high.

Get ready for this weekend’s “Woodstock for Capitalists.”

‘Too early to have full view’ of Bud Light backlash – AB InBev (BUD).

J&J (JNJ) spinout Kenvue (KVUE) soars in biggest IPO of the year.

Icahn says short report doesn’t impact liquidity, plans IEP unit distribution

Paramount (PARA) dives as vanishing dividend comes home to roost.

Shopify (SHOP) rallies on growth, job streamlining and asset sale.

Goldman Sachs (GS) under government review for role in SVB.

Carvana (CVNA) drives higher on promise of Q2 adjusted profits.

Intuit (INTU) is paying $141M for TurboTax settlement checks.

AMC (AMC) earnings watch: Wrestling with a strike, and the APE case.


Good morning. Happy Thursday.

The Asian/Pacific markets did well. Hong Kong, India, New Zealand, Indonesia and the Philippines posted solid gains. Europe, Africa and the Middle East are currently mostly down. Turkey is up, but the UK, Denmark, Poland, France, Germany, South Africa, Spain, the Netherlands and Italy are down notably. Futures in the States point towards a down open for the cash market.

————— Leavitt Brothers: Open Access —————

The dollar is up. Oil and copper are up. Gold and silver are up. Bonds are up.

Stories/News from Seeking Alpha…

May the 4th be with you

It may not be cloud cars or desert skiffs, but the FAA has some pretty bold plans that could soon bring Star Wars to life. According to an updated operational blueprint released by the agency, changes to airspace procedures would be made to accommodate flying taxis and new innovative aircraft. Other considerations to take into account include vertiports, existing infrastructure, travel routes and air traffic communication, which will all help usher in the next era of aviation.

What will the industry look like in 10 years? “I expect that we have air taxis at scale, especially in all of our major cities,” Acting FAA Administrator Billy Nolen said at The Wall Street Journal’s Future of Everything Festival. “If we’ve gotten it right from the regulatory framework, from the level of safety that the public expects, and if all that comes together, then it’s a world that we only thought about as science fiction before that becomes science fact in the moment.”

Traditional planemakers, like Airbus (OTCPK:EADSY) and Boeing (BA), as well as commercial carriers like American Airlines (AAL), Delta (DAL) and United (UAL), are pouring millions into the flying taxis, eVTOL prototypes and transportation partnerships. They are betting that the sector will one day shuttle passengers between airports and city centers, and could even help the airlines reach carbon-neutral targets. Other air mobility firms with skin in the game include Archer Aviation (NYSE:ACHR), Eve Air Mobility (NYSE:EVEX), Joby Aviation (NYSE:JOBY), Lilium (NASDAQ:LILM), Vertical Aerospace (NYSE:EVTL).

In a galaxy far, far way? The FAA expects to grant approval to the first air taxis as soon as next year, but it won’t be easy becoming the chosen one. Prototypes in development will have to pass safety approvals, operating guidelines and airspace integration, while the flying public will have to embrace them as a safe alternative. The industry might also have to scale to make the price point affordable, and may eventually turn to pilot automation, with humans on the ground monitoring operations. “One risk, I am seeing with coverage of Urban Air Mobility or eVTOL names is that the disruptive technology is often equated to value creation while this is not the case,” writes SA Investing Group Leader Dhierin Bechai. (2 comments)


The Federal Reserve hiked rates yesterday by a quarter of a percentage point in a move that surprised almost no one. It was a unanimous decision among policymakers, who seem to feel that the banking crisis is contained, inflation is too high, and labor demand is falling but is still strong. “People did talk about pausing, but not so much at this meeting,” Powell said in his post-decision press conference. “We feel like we’re getting closer or maybe even there, [but] are prepared to do more if greater monetary policy restraint is warranted.” Mentions of tighter credit conditions also caught the attention of the market, with Wall Street having a new acronym to focus on: SLOOS. Elsewhere, SA contributor Elazar Advisors explores what the situation may mean ahead of next week’s CPI print. (258 comments)

Biggest of the year

In fact, it’s the biggest IPO since EV maker Rivian (RIVN) went public in November 2021. At bat today is Johnson & Johnson (NYSE:JNJ) spinout Kenvue, which just upsized its hotly anticipated listing. Shares, which are set to trade this morning under ticker symbol “KVUE,” were priced on the upper end of their previously issued range, raising $3.8B and giving the healthcare carve-out a valuation of $41B. Previously known as J&J’s consumer products division, Kenvue produces medicines and brands like Aveeno, Band-Aid, Tylenol and Listerine, as well as J&J baby powder which has been at the center of major lawsuits (see how the company is handling those claims). (12 comments)

Companies in motion

Nordstrom (NYSE:JWN) is shuttering both of its downtown San Francisco stores in the coming months, dealing another blow to an area that has struggled to recover from the pandemic and has been in the spotlight for crime. “Decisions like this are never easy, and this one has been especially difficult,” read a memo by Chief Stores Officer Jamie Nordstrom. “As many of you know, the dynamics of the downtown San Francisco market have changed dramatically over the past several years, impacting customer foot traffic to our stores and our ability to operate successfully.” Other retail players recently closing down their San Fran outlets include Anthropologie (URBN), Banana Republic (GPS), Office Depot, Saks Off 5th and Whole Foods (AMZN). (4 comments)

Today’s Economic Calendar
7:30 Challenger Job-Cut Report
8:30 Goods and Services Trade
8:30 Initial Jobless Claims
8:30 Productivity and Costs
10:30 EIA Natural Gas Inventory
4:30 PM Fed Balance Sheet

What else is happening…

Wheat rallies as Kremlin drone attack casts doubt on grain deal.

PacWest Bancorp (PACW) confirms sale talks following stock plunge.

Apple (AAPL) likely to show solid iPhone results, update on capital return.

Anheuser-Busch Inbev (BUD) beats top and bottom line estimates.

U.K. regulator probes Adobe’s (ADBE) $20B deal for Figma.

Qualcomm’s (QCOM) outlook falls short amid ‘challenging’ phone market.

FTC moves to prohibit Meta (META) from monetizing youth data.

JPMorgan’s (JPM) Dimon said to be deposed in Epstein suits in late May.

WeWork (WE) looks to Uber (UBER) for next step in office-leasing model.

CVS (CVS) sets guidance below consensus despite earnings beat.

FDA approves GSK’s (GSK) RSV vaccine, world’s first shot against virus.


Good morning. Happy Wednesday. Happy FOMC Day.

The Asian/Pacific markets were weak. Japan and China were closed, but Hong Kong, South Korea, Taiwan, Australia, New Zealand, Indonesia, Singapore and the Philippines posted losses. Europe, Africa and the Middle East are currently split. Germany, Greece, South Africa, Sweden, Hungary, Italy, Israel and Switzerland are up; Turkey, Norway, Spain, the Netherlands, Portugal and Saudi Arabia are down. Futures in the States point towards a slight positive open for the cash market.

————— Leavitt Brothers: Open Access —————

The dollar is down. Oil and copper are down. Gold and silver are down. Bonds are up.

Stories/News from Seeking Alpha…

It’s showtime!

Fed policymakers will conclude their May policy meeting today with an assessment on whether they’ve done enough to cool down the hottest inflation seen in 40 years. Market participants are betting that the Federal Open Market Committee isn’t finished yet in its rate-hiking moves, with an 88% probability of a 25-bps hike, according to the CME’s FedWatch Tool. That would bring the federal funds rate target range to 5.0%-5.25%, marking the first time it topped the 5% mark since the lead-up to the global financial crisis.

Data to consider: Indeed, most economic reports over the past week appear to back up the argument for another rate hike, like the recent resolution of the First Republic Bank (FRC) deposit withdrawal stress. Another point that makes this case is Initial Jobless Claims, which unexpectedly fell on Thursday, in the face of a labor market that has been persistently resilient. The Q1 GDP report made central bankers’ decision more complicated, however, while the FOMC has also been watching the Employment Cost Index and Personal Income and Outlays.

RSM U.S. Chief Economist Joseph Brusuelas will be focusing on the Fed statement for any change to its expectation of “some additional policy firming” that it included in its March statement. “The committee will likely alter that phrase by changing ‘some’ to ‘any’, signaling flexibility on the future course of rate hikes and setting the stage for a possible strategic pause in the central bank’s efforts to restore price stability,” he wrote in a post. And if Fed Chair Jerome Powell does signal a willingness to pause the rate hikes, he’s almost certain to add that the central bank isn’t yet declaring victory on its inflation fight.

What about markets? Investors are apparently ignoring the Fed’s inflation-fighting resolve, writes SA analyst Logan Kane, while John Mason takes a deeper dive into just how much depends upon Jay Powell. Mott Capital Management and Cavenagh Research also go head-to-head on the coming direction of U.S. monetary policy. See The Fed’s May Rate Hike Will Likely Not Be Its Last and The Fed May Cut In May, June, And July To 4.0%. (74 comments)

Crisis rekindled

Regional bank stocks are trading at their lowest level since 2020 as investors debate whether the sector will see broader contagion following the second-largest bank failure in U.S. history. Even market movement is being debated, like the severe losses concentrated at PacWest (NASDAQ:PACW) and Western Alliance (NYSE:WAL), which tumbled 27% and 15%, respectively, on Tuesday (the selloff is continuing premarket). Some say that there has been no change in the fundamentals, and the only reason why the stocks are plunging is because of their venture-focused business models, which mirror those of recently failed lenders like Silicon Valley Bank. Both PacWest and Western Alliance also posted earnings results in April that indicated their deposit bases had stabilized, but others feel that shareholders and depositors running for the exit at the same time is a recipe for disaster. (11 comments)

Take the Fourteenth?

A standoff over the debt limit has prompted administration officials to once again explore the constitutionality of the ceiling as the U.S. inches closer to a catastrophic default. While President Biden has repeatedly said it is the job of Congress to raise the ceiling, what happens if a compromise cannot be reached? One such theory, which would surely expose the government to lawsuits, would see new debt continue to be issued under the 14th Amendment, which maintains that the “validity of the public debt of the United States… shall not be questioned.” Lawyers at the White House, Treasury and DOJ have never issued formal opinions on the question, but financial markets would be roiled if the option – once deemed as unthinkable – was used. Also see why Congress first instituted a debt ceiling and if the U.S. has ever defaulted. (7 comments)

Activist battle

Icahn Enterprises (NASDAQ:IEP) lost a fifth of its value yesterday following a new report from Hindenburg Research. The short seller alleged the IEP units are “inflated” and Carl Icahn “made a classic mistake of taking on too much leverage in the face of sustained losses: a combination that rarely ends well.” The Wall Street legend was quick to respond and defended his holding company that consists of seven primary businesses in energy, investment, automotive, food packaging, real estate, home fashion and pharmaceuticals. Hindenburg is one of the most high-profile short sellers in the past few years, and is well known for its calls on Nikola (NKLA) and Lordstown Motors (RIDE), as well as this recently targeted tech company. (454 comments)

Today’s Economic Calendar
7:00 MBA Mortgage Applications
8:15 ADP Jobs Report
9:45 PMI Composite Final
10:00 ISM Services Index
10:30 EIA Petroleum Inventories
2:00 PM FOMC Announcement
2:30 PM Jerome Powell Press Conference

What else is happening…

Investing millions, Ben Shapiro joins board of Oramed Pharma (ORMP).

Pfizer (PFE) reaffirms FY23 outlook as COVID franchise outperforms.

AMD (AMD) CEO says chipmaker still dealing with a ‘mixed’ sales market.

Upbeat bookings outlook from Uber (UBER), talks about the competition.

Energy stocks crushed along with crude as economic outlook sours.

Despite Q1 beat, slower pace of BP (BP) buybacks hits sentiment.

Bud Light backlash: Anheuser-Busch (BUD) said to offer free beer.

Starbucks (SBUX) falls after setting cautious guidance on conference call.

Ford (F) cruises past expectations, but the stock still falls.

White House calls a meeting of tech CEOs for AI safety measures.


Good morning. Happy Tuesday.

The Asian/Pacific markets leaned to the upside. South Korea, India, Taiwan, Malaysia and the Philippines did well; Australia and Indonesia were weak. Europe, Africa and the Middle East currently lean down. Poland, Hungary and Israel are up; Denmark, France, Russia, Greece, South Africa, Portugal, Austria, Sweden and Saudi Arabia are down. Futures in the States point towards a slight down open for the cash market.

————— Leavitt Brothers: Open Access —————

The dollar is up. Oil and copper are down. Gold is up; silver is down. Bonds are up.

Stories/News from Seeking Alpha…

Game of chicken

The battle over the debt ceiling has been kicked up a notch after a warning from Treasury Secretary Janet Yellen saying that extraordinary measures to pay the government’s bills could run out as early as June 1. That contrasts with her update in January that estimated it was unlikely to run out of cash before early June. As part of the extraordinary measures, the Treasury is suspending the issuance of State and Local Government Series Treasury Securities, which will deprive states and municipalities of an important tool to manage their finances.

Quote: “Given the current projections, it is imperative that Congress act as soon as possible to increase or suspend the debt limit in a way that provides longer-term certainty that the government will continue to make its payments,” Yellen declared. “We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States.” Yields on the short side of the Treasury curve spiked sharply on the news, with the 1-month Treasury bill (US1M) jumping 44 basis points overnight to 4.81%.

While raising the debt ceiling has turned into a bitter partisan issue over the years, even prompting a credit rating downgrade of U.S. government debt in 2011, both parties have always reached a late deal to avoid the country going into default. Last month, House Speaker Kevin McCarthy introduced a bill that proposed raising the $31.4T debt ceiling by $1.5T – along with limiting federal spending – but tensions are on full display, with Republicans and Democrats remaining far apart. Following the latest news, President Biden invited McCarthy and other congressional leaders to a meeting on May 9, but only a handful of rejections could derail any deal, and concessions may be a lot harder to come by – especially with extreme flanks enveloping both sides of the debt limit debate.

Other ways out? “The Treasury could just ignore Congress and issue notes and bonds with coupons well above current yields,” writes SA contributor James Baker, referencing a novel solution to the debt crisis. Another one that uses an accounting ploy, called the “trillion-dollar coin,” has been previously referred to by Janet Yellen as a “gimmick.” Recall, that the first Wall Street Breakfast of the year flagged America’s national debt as something that might become a bigger problem in 2023. Take a look back at the risks and opportunities. (39 comments)

Changes to deposit insurance

Following three bank failures in the past seven weeks, the FDIC has released an overview of the deposit insurance system and suggested three options for reform to address financial stability concerns. As it stands now, the FDIC caps deposit insurance at $250K per account – regardless of whether it is for an individual or a business – but it didn’t work that way when it seized First Republic Bank (NYSE:FRC) on Monday. The resolution and sale of assets to JPMorgan Chase (NYSE:JPM) protected all deposits, including uninsured ones, and didn’t require a systemic risk exception. While the newly proposed options would require Congressional action, some aspects of the report “lie within the scope of the FDIC’s rulemaking authority.” (122 comments)

Writer’s block

Hollywood writers have gone on strike, marking the first such labor stoppage in the entertainment industry since 2007. The action threatens to slow program production that had recovered from deep COVID-19 pandemic stoppages, with complaints that Netflix (NASDAQ:NFLX), NBCUniversal (CMCSA), Warner Bros. Discovery (WBD) and others created a gig economy inside a union workforce. Writers Guild of America members will be prohibited from working on struck productions, and will be unable to sell and pitch scripts, threatening millions or even billions in lost output. In related news, Vice Media (TPG, DIS) is preparing to file for bankruptcy as it struggles to find a buyer with advertising in the dump. (47 comments)

Happening that fast?

Artificial intelligence may not yet be causing layoffs, but recent technological advances are starting to pause hiring in certain industries. IBM (NYSE:IBM) CEO Arvind Krishna is tapping the brakes, expecting that 30% of back office functions, like human resources, will be replaced by AI and automation over a five-year period (that could mean letting go of around 7,800 employees). While IBM attempts to capitalize on the new era, the company had been a clear early leader in artificial intelligence and supercomputing. Its Deep Blue chess-playing system beat world champion Garry Kasparov in 1997, while IBM Watson AI won the top prize in Jeopardy back in 2011. Recent Seeking Alpha news on AI also includes Chegg slides with students ramping up usage of ChatGPT and Rising AI enthusiasm continues to benefit Nvidia. (4 comments)

Today’s Economic Calendar
FOMC meeting begins
10:00 Factory Orders
10:00 Job Openings and Labor Turnover Survey

What else is happening…

WSB survey points to new Wall Street adage: “Go away from sell in May.”

Taser-maker AXON to replace First Republic (FRC) in S&P 500.

DeSantis’ board plans to counter-sue Disney (DIS) in oversight battle.

FuelCell Energy (FCEL) grabs Exxon (XOM) carbon capture order.

Environmental groups sue FAA over SpaceX (SPACE) rocket launch.

Lordstown Motors (RIDE) plunges after issuing going concern warning.

AMD (AMD) earnings could be a sign of semiconductors’ recovery.

U.S. to end COVID vaccine mandates for foreign travelers next week.

Strategic alternatives: BlackBerry (BB) considers breakup of businesses.

Pausing may be harder than central banks think – just look at Australia.


Good morning. Happy Monday. Hope you had a good weekend.

The Asian/Pacific markets were mostly closed today. Japan did well. Europe, Africa and the Middle East are also mostly closed. There were no notable movers. Futures in the States point towards a flat-to-down open for the cash market.

————— Leavitt Brothers: Open Access —————

The dollar is unchanged. Oil is down; copper is up. Gold and silver are up. Bonds are down.

Stories/News from Seeking Alpha…

Save The Republic!

Regulators have taken possession of First Republic Bank (NYSE:FRC), resulting in the third failure of an American regional bank since the collapse of Silicon Valley Bank (OTC:SIVBQ) and Signature Bank (OTC:SBNY) in March. The Federal Deposit Insurance Corporation has been appointed as receiver and accepted a bid from JPMorgan (NYSE:JPM) to assume all deposits, including all uninsured deposits, and substantially all assets of First Republic Bank. That includes $173B in loans and about $30B of securities, though it will not assume First Republic’s corporate debt or preferred stock. Premarket movement: FRC -43.3% to $1.99/share; JPM +2.7% to $142/share.

Fine print: “Our government invited us and others to step up, and we did,” said JPMorgan CEO Jamie Dimon. “Our financial strength, capabilities and business model allowed us to develop a bid to execute the transaction in a way to minimize costs to the deposit insurance fund” (which is estimated at about $13B). The FDIC will also enter into a loss-sharing agreement with JPMorgan on single family, residential and commercial loans, and provide $50B in financing to the bank. Meanwhile, JPMorgan is set to realize a one-time $2.6B gain from the deal, but expects to spend $2B on restructuring costs over the next 18 months.

It’s been a wild ride for First Republic, which has teetered on the brink of failure for nearly two months. The bank’s business model, which funded cheap mortgages to wealthy clients from little or zero-interest deposits, got hammered when rates rose rapidly. Clients then panicked and major paper losses ensued for its long-dated assets. Last week, First Republic revealed that deposit outflows totaled $70B in Q1, and put the spotlight on Wall Street institutions that deposited $30B at the bank on March 16 to stave off additional fallout to the industry.

Outlook: Is this the closing chapter of the banking turmoil that started in March, or just the next phase in the crisis? SA Investing Group Leader Lance Roberts discusses how things will end, Mott Capital Management explores the impact on rates, while contributor Bill Kort examines how flight-to-safety trades have played out since the turmoil. Other ongoing and systematic concerns are whether the nation’s largest banks are getting even bigger, and how the tightening of the current lending environment will translate to the real economy. (103 comments)

Survey Monday

“Whether or not you subscribe to Wall Street’s adage ‘sell in May and go away,’ it’s nearly impossible to time the market, but you can identify stocks with strong fundamentals,” writes Steve Cress, Head of Quantitative Strategies at Seeking Alpha. If the market retreats, he recommends buying these three stocks, which are in sectors that have historically performed well during summer and possess solid metrics that can be viewed as an opportunity to buy on overall market weakness. Debunking a longer-term trend, nine out of the last ten years have delivered positive returns between May 1st through October 31st, but will it happen again this year? Size up the sentiment with Wall Street Breakfast’s latest poll to see if a pivot to safer sectors is warranted.

Take the survey and see the results here

Grain deal

In a show of unity, as Ukraine plans a major counter-offensive against Russia, a deal has been reached that would allow the transit of Ukrainian grain to resume through five neighboring EU countries. Restrictions were imposed by Poland and Hungary, as well as Romania, Bulgaria and Slovakia, after much of the produce ended up in their local markets and crashed prices for local farmers. Not many details of the agreement have been revealed, but it covers wheat, maize, rapeseed and sunflower seeds, and includes a financial support package worth €100M for farmers. “I welcome the agreement in principle,” tweeted European Commission President Ursula von der Leyen, adding that it “preserves both Ukraine’s exports capacity so it continues feeding the world, and our farmers’ livelihoods.”

Commercial worries

Storm clouds are brewing for the U.S. commercial property market, according to Berkshire Hathaway (NYSE:BRK.B) Vice Chairman Charlie Munger, who warned of a potential crash amid trouble in the U.S. financial system. “It’s not nearly as bad as it was in 2008,” he told the Financial Times. “But trouble happens to banking just like trouble happens everywhere else. In the good times you get into bad habits. When bad times come they lose too much.” While Berkshire has a history of supporting American banks through cycles of financial instability – such as investing $5B in Bank of America (BAC) in 2011 and coming to the aid of Goldman Sachs (GS) in 2008 – things are different this time around, Munger explained, as investors keep an eye on office REITs, malls, and shopping center players. (30 comments)

Today’s Economic Calendar
9:45 PMI Manufacturing Index
10:00 ISM Manufacturing Index
10:00 Construction Spending

What else is happening…

Review: Fed bears some of the blame in SVB’s (OTC:SIVBQ) failure.

Arm (ARMHF) confidentially files for U.S. initial public offering.

Astellas (OTCPK:ALPMF) agrees to buy Iveric Bio (ISEE) for $5.9B.

The ‘Super Mario Bros. Movie’ (CMCSA) tops $1B milestone.

U.K. overhauls some gambling laws – watch these stocks.

Occidental (OXY) starts digging first direct-air carbon capture plant.

Solar developers likely safe from tariffs after narrow House vote.

Was OPEC was right? Weak demand erases oil gains from output cut.

U.S. cannabis sales to hit $71B in 2030 even without federal reforms.

Report: Carvana (CVNA) creditors propose debt-for-equity swap.

AWS (AMZN) may see a slowdown, but $2.5T opportunity may await.

Fewer Americans live paycheck-to-paycheck, but trouble brews for millennials.


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