Welcome Back,

FDIC is preparing a plan to refill their fund after the banking chaos we have seen the past few weeks. A new CEO set to takeover Twitter, any guesses who it is?

Let’s keep it concise.

Market Headlines 👀

• US Price Producer Index (PPI) comes in at 0.2% MoM; est 0.3%. 2.3% vs 2.5% YoY.

• US Jobless claims come in at 264k; est 245k.

  • Highest since October 2021

• Twitter (TWTR) Elon Musk announces a new CEO will take lead of X/Twitter in about six weeks. Elon to transition to CTO.

• PacWest (PACW) shares decline after it says deposits fell 9.5% last week.

• Federal Reserve Deposit Insurance says big banks will face extra fees as the FDIC forms a plan to replenish the insurance fund.

• SoftBank (SFTBY) vision funds posts a record loss of $39b.

• Bank of England (BOE) raises its benchmark rate 0.25bps.

• Microsoft (MSFT) EU regulators are set to approve Activision Blizzard $69b takeover next week.

• Uber technologies (UBER) launches flight booking option in their UK app.

• Peloton Interactive (PTON) shares decline after company recalls 2.2m exercise bikes.

• EU lawmakers committees agree on stricter rules over use of Artificial intelligence.

• Jp Morgan (JPM) CEO Jamie Dimon believes panic will ensue as we come closer to a US debt default possibility.

• Blackstone Group (BX) is in talks with US regional banks over lending.

• China CPI comes in at 0.1% in April YoY; est 0.3%.

• Robinhood (HOOD) will launch a 24-hour trading option for its users on select stocks and ETFs.

• Lyft (LYFT) will discontinue pooled rides going forward.

Earnings 💸

• JD.com(JD)

  • EPS: $4.76 beats (exp. $3.59)

  • Revenue: $242.95b beats (exp. $240.95b)

• Fiverr International (FVRR)

  • EPS: $0.36 beats (exp. 0.17)

  • Revenue:$87.95m beats (exp. $87.69m)

S&P 500 Heap Map

Recap Around the Street 🧠

This week’s rise in jobless claims confirm the slowdown in labor market activity but shows no major cracks that would push the unemployment rate above 4%, a key level the Federal Reserve has expressed as a catalyst to reverse tighter monetary policy. (Contributed by Benjamin Lavine, CIO at 3D/L Capital).

Credit card balances should be scaled by income levels and net worth which still show reasonable affordability when compared to pre-pandemic levels. However, credit card spending is showing meaningful signs of a slowdown based on bank data and surveys, particularly in retail spending on goods and furnishings. Even travel and leisure, the bulwarks of post-pandemic spending, have seen meaningful drops with only restaurants now showing consistent spending growth according to Bank of America. (Contributed by Benjamin Lavine, CIO at 3D/L Capital).

The bond market sees a hard recession as it discounts lower inflation-adjusted interest rates starting in late 2023. The U.S. equity markets anticipate an earnings slowdown this year to be followed by a sharp recovery in 2024 aided by resilient high profit margins. (Contributed by Benjamin Lavine, CIO at 3D/L Capital).

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Market Preview 🎞️

• Friday, May 12th: University of Michigan sentiment survey

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