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12-09-2023

TECH

• Microsoft’s $13 billion investment in OpenAI is under scrutiny by regulators in the UK and US for potential antitrust implications.

• European negotiators in Brussels spent nearly 24 hours debating to reach an agreement on regulating AI, but fell short. The European Union has reached a provisional deal on comprehensive regulations for artificial intelligence, including rules on systems like ChatGPT and facial recognition. The AI Act proposals will be voted on by the European Parliament in early 2022. The regulations aim to safeguard the use of AI within the EU and limit its adoption by law enforcement agencies, while also allowing consumers to file complaints and imposing fines for violations.

• Apple’s vice president of product design, Tang Tan, is leaving in February, resulting in personnel changes and a reshuffling of duties.

• OpenAI’s recent boardroom drama involves key players Sam Altman, Greg Brockman, Ilya Sutskever, Mira Murati, and Adam D’Angelo. Altman was initially fired but later returned after raising $13 billion from Microsoft. Tensions arose over the dangers and benefits of AI. Elon Musk agrees with Altman’s assessment of antisemitism.

• Apple is diversifying its production by shifting iPad and iPhone manufacturing to Vietnam and India, respectively, reducing reliance on China.

• Broadcom reported strong Q3 earnings, raised dividend; Q4 earnings missed expectations; stock upgraded; predicts $50B revenue in 2024. Ciena Corp reports strong Q4 results, expects 6-8% annual revenue growth for next 3 years.

• DocuSign’s Q3 2024 earnings missed expectations with EPS of $0.1865, but revenue increased 9% to $700 million. Dave & Buster’s stock rose 3.48% on a strong trading day.

• Beeper Mini, an iMessage client for Android, has been blocked by Apple, causing an outage for Android users.

• Venture capital has become more competitive during the pandemic, with a scarcity of good deals and capital. Startups have seen declines in funding and valuations, leading to a significant number of failures. Indian startups have also experienced a drop in investment.

• Splunk Inc. stock rose after being highlighted in Carillon Clarivest Capital Appreciation Fund’s Q3 2023 investor letter, along with Alphabet Inc., NVIDIA Corporation, Apple Inc., and Intuitive Surgical.

• Amazon files motion to dismiss FTC’s antitrust lawsuit, claiming lack of evidence of consumer harm and benefiting competition.

• Malaysia’s YTL Power and Nvidia are partnering in a $4.3B investment to develop AI infrastructure, including a supercomputer and data center.

• Comtech Telecommunications Corp. misses Q1 2024 earnings expectations, undergoing transformation. Semtech Corp. beats Q3 2024 earnings expectations, with $200.9 million in net sales. Comtech Telecommunications Corp. sees 15.9% increase in Q1 2024 net sales compared to last year.

• Telecom operators Vodafone, EE, O2, and Three are facing a £3 billion ($3.78 billion) claim for overcharging customers at the end of their contracts. The claim is on behalf of 2.3 million to 4.8 million contract customers.

• Japan is providing $902 million to Toshiba and Rohm for their joint venture to boost production of power semiconductors for electric vehicles and factories.

MEDIA

• The US criticizes Israel’s conduct in the Israel-Gaza conflict, vetoing a UN ceasefire resolution, as the humanitarian situation worsens.

• Ross Stevens, the founder of Stone Ridge Holdings Group, threatens to withdraw a $100 million donation to the University of Pennsylvania over their handling of antisemitism. University of Pennsylvania President Liz Magill faces calls for resignation. The presidents of Harvard, M.I.T., and the University of Pennsylvania are criticized for their responses to questions about antisemitism and genocide. The Wharton business school at the University of Pennsylvania and the board of advisors call for President Liz Magill’s resignation. Donors express disappointment and call for the removal of university presidents. The Ivy League presidents condemn campus antisemitism. Congressional inquiry and backlash from donors follow the handling of antisemitism on campus by Harvard, M.I.T., and the University of Pennsylvania.

• Ryan O’Neal, the bankable star of the 1970s known for films like “Love Story” and “Paper Moon,” has died at 82.

• Spotify’s CFO, Paul Vogel, is leaving the company in March after selling $9.38 million worth of shares and following a major layoff.

• Skydance Media and RedBird Capital are considering a takeover of Paramount Global, causing a surge in Paramount’s stock.

• Taylor Swift’s ”The Eras Tour” has become the highest-grossing concert tour ever, grossing over $1 billion with 4.3 million tickets sold.

• Former President Trump’s gag order in the federal case regarding election interference has been largely reinstated, with some exceptions.

• Baldur’s Gate 3, the Game of the Year winner, is now available on Xbox Series X/S after technical issues and costs $69.99.

• The Game Awards 2023 faced backlash for prioritizing promotion over awards, featuring Hollywood actors, and neglecting the struggling games industry.

• Elon Musk criticizes Disney CEO Bob Iger for supporting child exploitation on Meta-owned platforms and demands his firing.

• Jon Rahm, the Masters champion and world No. 3 golfer, has joined Saudi-backed LIV Golf in a deal worth over $300 million, leaving the PGA Tour.

• Michigan teen Ethan Crumbley has been sentenced to life in prison without parole for a school shooting that killed four classmates.

• Nicki Minaj’s ”Pink Friday 2” album, featuring guest appearances and samples, dominates the iTunes chart and showcases her mature rap skills.

• Researchers at the University of Calgary discovered a fossilized tyrannosaur with preserved stomach contents, revealing its last meal of dismembered young Citipes dinosaurs.

CONSUMER

• Dollar General Corp reported a 2.4% increase in net sales for Q3 2023, but same-store sales declined by 1.3%.

• Vera Bradley beats Q3 earnings expectations with $0.19 EPS, while revenues decrease 5%. Guidewire Software and Veeva Systems also exceed expectations.

• RH stock fell 9% after reporting a surprise quarterly loss and lower guidance due to a frozen housing market and higher expenses.

• Johnson Outdoors Inc. experienced a decline in sales and net income for fiscal year 2023 due to decreased demand and higher inventory levels at retail. The company is focusing on innovation and cost savings to improve profitability.

• Smith & Wesson Brands reports 3% revenue increase and unit shipments growth in Q2 2024, driven by share gains and strong product performance.

• Delta Apparel reported a 14% decline in full-year sales to $415.4 million due to high cotton prices and low demand.

• Allegion PLC shares rise 5% to end losing streak, ContextLogic Inc. and NOV Inc. also outperform market, Kohl’s Corp. gains.

• The National Retail Federation retracts claim that organized retail crime caused half of industry’s $94.5 billion losses in 2021.

• Adidas plans to prioritize smaller sports like breaking, climbing, skateboarding, and BMX to establish its brand before the Paris Olympics.

• LVMH has sold a majority stake in its cruise retail business, Starboard Cruise Services, to investors led by Jim Gissy, while remaining a minority shareholder.

REAL ESTATE

• UK mortgage rates have dropped below 6% for the first time in six months, with lenders offering competitive rates.

• A 26-year-old woman was arrested in Atlanta for attempting to burn down Martin Luther King Jr.’s birth home. Bystanders intervened.

• 2023 was the least affordable year for homebuyers due to high mortgage rates, low inventory, and elevated prices. Improvements projected in 2024.

• A study found that 23% of first-time homebuyers in 2023 received down payment gifts or loans, while almost half of young buyers in the UK received financial assistance from parents or grandparents averaging £25,000.

• Immigrants are leaving Canada due to high housing costs and rental shortages, causing concern and potentially undermining immigration policies.

ECONOMIC

• Hunter Biden, son of President Joe Biden, has been indicted on nine tax charges in California, including tax evasion.

• Russian President Vladimir Putin has announced his intention to run for re-election in the March 2024 presidential poll, potentially extending his rule until 2030.

• Consumer sentiment in the US has seen a surprising 13% increase in December, driven by expectations of lower inflation.

• Mixed Asian markets, European markets up, oil around $70 per barrel, US stock markets higher. Oil futures higher but on track for seventh consecutive weekly loss.

• GameStop Corp. stock fell 4.95% with high trading volume. Xcel Energy, Conagra Brands, Textron, LabCorp, and Cummins Inc. also underperformed. Packaging Corp. of America and CSX Corp. stocks slid. Alphabet’s GOOGL and GOOG stocks fell ahead of earnings disclosure.

• Corebridge Financial (CRBG) will pay a dividend of $0.23 per share, Broadridge Financial (BR) $0.80 per share, Seacoast Banking (SBCF) $0.18 per share, Stewart Information Services (STC) $0.47 per share, Stellar Bancorp (STEL) $0.13 per share, Community Trust Bancorp (CTBI) $0.46 per share, United Community Banks (UCBI) $0.23 per share, and Community Bank System (CBU) $0.45 per share. Concerns raised about STC’s sustainability and CBU’s flat earnings growth.

• China’s Politburo pledges to strengthen fiscal policy, focus on economic progress, and boost domestic demand for sustainable growth.

• Argentina’s new president, Javier Milei, an ultra-libertarian economist, plans to close the Central Bank and dollarize the economy.

• China’s consumer prices fell by 0.5% in November, the steepest drop in three years, indicating increasing deflationary pressure and weak domestic demand. Factory-gate deflation also deepened.

• PNC Financial stock rose 0.64%, Biogen rose 0.07%, AbbVie rose 0.89%, Western Union rose 0.93%, W.R. Berkley rose 0.61%, and Berkshire Hathaway rose 0.11%.

CRYPTO

• Binance founder Changpeng Zhao, also known as CZ, must remain in the US until his February sentencing for money laundering charges.

• Bitcoin surpasses $44,000, boosting optimism for cryptocurrency and related stocks, ahead of potential Bitcoin spot ETF approval in January.

• The SEC plans to continue its case against Binance despite the exchange’s settlement with the DOJ, citing separate concerns.