Benzinga - Short selling ban on bank stocks is likely about to happen. The White House is monitoring the short-selling pressure very closely. They need to avoid chaos and collapse at all costs.
This is what they did in 2008.
Market
Prices as of 4 pm EST, 5/4/23
Macro The US trade gap narrowed to a 4-month low in March.
- Exports increased by 2.1% to $256.2 billion while imports slowed by 0.3% to $320.4 billion as consumers spend less on goods and the labor market (slowly) cools.
- America’s trade deficit with China fell to its lowest since March 2020.
The FDIC plans to refill its Deposit Insurance Fund (DIF) with help from fees imposed on big banks.
- The amount banks pay will be based on the size of their balance sheets and the number of depositors.
- Smaller banks with less than $10 billion in assets will be exempt from the special assessment fee.
- The proposal could be introduced as early as next week.
Initial jobless claims in the US increased by the most in 6 weeks, rising more than expected to 242,000.
- The climb suggests some cooling in a resilient labor market.
- Continuing claims, on the other hand, dropped by 38,000, the largest decline since July.
Stocks Pacific West Bancorp wants the world to know it is NOT PacWest Bancorp.
- The former made changes to the front page of its website to explicitly state it has no association whatsoever with the latter.
- Pacific West (not PacWest) shares trade over the counter at a $28 million market cap and have declined just 3.6% YTD.
Meanwhile, the actual PacWest saw its value cut in half yesterday.
- Its decline led an index of regional banks down to levels not seen since September 2020.
- Also falling sharply was First Horizon, which watched shares drop 33% after its merger with TD Bank was terminated.
- Other big losers included Western Alliance (-38%) and Zion Bank (-12%).
Investors will be turning to long-duration assets to hedge against a possible recession this year, according to JPMorgan strategists.
- That means increased demand for gold, tech stocks, and non-USD currencies.
- Gold is currently flirting with all-time highs while the share of tech in global equities has risen sharply, suggesting investors are increasingly overweight tech.
Energy US oil prices are on pace for their third consecutive weekly drop after falling more than 8% this week.
- Prices briefly collapsed to their lowest intraday level since 2021 yesterday before rebounding.
- Despite the drop, the physical market remains tight which suggests the decline may be excessive.
Earnings Yesterday’s highlights:
Apple (NASDAQ: AAPL): $1.52 EPS (vs. $1.43 expected), $94.84 billion in sales (vs. $92.96B expected).
- Apple topped expectations for iPhone sales but missed those for Mac and iPad.
- iPhone revenue increased 2% YoY while the broader smartphone industry contracted ~15% over the same period.
- Mac and iPad revenues, meanwhile, dropped 21% and 13% YoY, respectively.
- Overall revenue fell 3% YoY while net income declined by the same amount.
What we’re watching today:
- Enbridge (NYSE: ENB)
- Cigna (NYSE: CI)
- Dominion Energy (NYSE: D)
- Johnson Controls (NYSE: JCI)
- CNH Industrial (NYSE: CNHI)
- Liberty Formula One (NASDAQ: FWONK)
- EPAM Systems (NYSE: EPAM)
- CBOE Global (BATS: CBOE)
- Magna International (NYSE: MGA)
- Evergy (NASDAQ: EVRG)
- Credicorp (NYSE: BAP)
- Ichan Enterprises rescheduled for May 10
Top Headlines
- Food inflation: For the first time in a year, global food prices increased, rising 0.6% in April.
- ECB: The European Central Bank slowed its pace of interest rate hikes but indicated it isn’t pausing yet.
- Eurozone retail: Retail sales in the Eurozone fell for the 2nd straight month, declining by 1.2% in March.
- China services: Despite a slight slowdown in April, China’s services sector remains in growth territory.
- Tesla deliveries: Shipments of Tesla’s China-made Model Y and Model 3 cars fell 14.7% in March.
- Dimon goes East: JPMorgan CEO Jamie Dimon will visit mainland China for the first time in 4 years.
- Layoffs: Shopify will cut 20% of its workforce in its second round of layoffs.
- AI vs. jobs: According to a recent academic paper, white-collar occupations are the most exposed to generative AI.
Crypto
Prices as of 4 pm EST, 5/4/23
- COIN earnings: Coinbase’s net loss shrunk in Q1 as net revenue grew 22% from the previous quarter and EBITDA flipped positive.
- COIN defense: The company is arguing lawsuit threats against it are undermined by its clearance from regulators to go public in the first place.
- BTC transaction fees: Bitcoin’s (CRYPTO: BTC) average transaction fee has risen to nearly $7, the highest in 2 years.
- ETH gas fees: A surge in trading for the PEPE (CRYPTO: PEPE) meme coin has pushed Ethereum (CRYPTO: ETH) gas fees to a 1-year high.
- Voyager to liquidate: The bankrupt lender says it could start making distributions to creditors within the next few weeks.
Deals
- IPO pop: J&J’s consumer healthcare spinoff Kenvue finished up ~22% in its stock market debut.
- Logistics: Flexport has acquired Shopify’s logistics arm which includes last-mile delivery startup Deliverr.
- E-commerce: Alibaba’s global online shopping unit—which includes Lazada, Trendyol, and AliExpress—is exploring a US IPO
- Fintech: Ant Group’s transformation into a fully regulated company is on pause due to a reshuffling of China’s financial regulatory system.
- Antitrust: Broadcom’s CEO will present arguments today to EU regulators to convince them on its $61 billion VMWare acquisition.
Meme Of The Day
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