Public Markets 3d Briefing
×Market Turmoil Amid Iran War
US stock futures bloomberg.com dropped as oil prices surged above $100 a barrel, stoking inflation fears. Brent crude wsj.com hit its highest intraday level since mid-2022, with major producers forced to shut down output. The S&P 500 is facing a potential 10% correction as war risks build up, according to JPMorgan.
Energy Crisis Deepens
Saudi Arabia has started reducing oil production as the near-blockage of the Strait of Hormuz starts filling storage tanks. The UAE and Kuwait bloomberg.com also began cutting output. Qatar Energy is pushing back the start of a major liquefied natural gas expansion project to at least 2027 after a drone attack forced the unprecedented closure of its Ras Laffan plant. Several more LNG shipments have diverted toward Asia from their course to Europe as tensions curb global supply.
Inflation and Central Bank Responses
Traders amped up bets on interest-rate hikes from the European Central Bank and the Bank of England as soaring energy prices fueled fears of an inflation spike. The Group of Seven nations is "not there yet" in terms of organizing a global release of emergency oil inventories in response to the Iran war, according to France. European Union Economy Commissioner Valdis Dombrovskis bloomberg.com said euro-area finance chiefs will talk about a possible joint release of oil reserves after crude smashed through $100 a barrel.
Emerging Markets Under Pressure
The selloff in emerging markets intensified Monday, with currencies wiping out their year-to-date gains, as oil prices above $100 a barrel threatened to unleash growth and inflation shocks across the developing world. South African government bonds extended their worst selloff since the Covid pandemic as concern mounted that soaring oil prices and a weaker rand will fuel inflation. Pakistan's central bank bloomberg.com held its key policy rate citing economic uncertainty after oil prices surged.
Corporate and Investment News
UBS Group bloomberg.com increased its bonus pool for last year by 10% as the Credit Suisse integration nears its end, while keeping CEO Sergio Ermotti's compensation unchanged. Millennium Management bloomberg.com hired four stock pickers from rival Citadel as the multistrategy hedge fund giants battle over talent. Banks are likely to face higher costs in issuing significant risk transfers as investors become more demanding in the face of growing economic uncertainty.
Technology and AI Developments
Microsoft ft.com added Anthropic AI models to its Copilot workplace tools, integrating technology from OpenAI's rival as it diversifies away from Chat GPT maker. Nvidia ft.com and ABB launched a partnership for AI-enabled autonomous robots, with industrial robots that can be trained in virtual conditions being trialled by Foxconn. Google ft.com gave CEO Sundar Pichai a new pay deal worth up to $692 million, with stock options tied to the share price and growth of Waymo.
Defense and Aerospace
Submarine components supplier Gabler Group's shares rose as much as 13.6% on their first day of trading in Germany, buoyed by strong demand among investors for European defense firms. The world's largest alternative asset managers are confronting a painful choice regarding private credit funds as investors seek exits. Powerus wsj.com, a new drone company targeting Pentagon sales, says it plans to acquire Ukrainian drone technology to sell to the U.S. military.
Media and Entertainment
Simon & Schuster wsj.com named former Amazon executive Greg Greeley as CEO, turning to an industry outsider as expanded entertainment options squeeze the book business. Netflix's stock price is staging a dramatic reversal triggered by management's decision to walk away from its proposed acquisition of Warner Bros. Discovery late last month. Live Nation wsj.com reached a settlement with the DOJ in its antitrust case, sparing the concerts-and-ticketing giant from the threat of its business being broken up.
Automotive Industry
Volkswagen AG bloomberg.com is broadening its battery ambitions beyond electric vehicles into large-scale energy storage and trading as global EV demand falls short of expectations. Volkswagen dealers wsj.com revolted over a plan to sell a new brand of SUV directly to consumers, with the latest of several lawsuits seeking to stop the automaker from bypassing dealerships. Analysts warn Europe's largest carmaker may struggle to lift margins despite historic restructuring as Chinese rivals pose an "existential threat."
Financial Services and Banking
Bank of America Corp. bloomberg.com led banks that have launched a $2.75 billion leveraged loan to help fund Nexstar Media Group's pending acquisition of rival TV-station owner Tegna Inc. JPMorgan Chase & Co. bloomberg.com sees a 10% correction in the S&P 500 as war risks build up. The Swiss National Bank bloomberg.com is very likely intervening in currency markets to curb the franc's strength, according to Bank J Safra Sarasin's chief economist.
Real Estate and Infrastructure
EQT ft.com, a Swedish private equity group, took a 42% stake in Yorkshire Water, injecting funds into the utility in a sign of enduring investor confidence in the industry. Germany's top financial watchdog BaFin sees considerable risks for private investors in open-ended real estate funds and other such financial products. The former coal miner nytimes.com in the middle of the AI data center boom raised $2 billion from investors, with Sheryl Sandberg joining its board.
Pharmaceuticals and Healthcare
Agilent Technologies Inc. bloomberg.com agreed to acquire privately held Biocare Medical, which makes instruments and materials used in cancer research, in an all-cash transaction valued at $950 million. China's health ministry bloomberg.com urged people at potential risk to undergo cancer screenings as part of a broader push to improve prevention and control of the disease. Dr. Vinay Prasad nytimes.com, a divisive F.D.A. vaccine regulator, is resigning after drawing criticism for overriding career scientists.
Publishing and Media
Disney wsj.com needs its next hit franchise as Pixar's reluctant leader faces pressure to deliver. The "Toy Story" studio used to print money for Disney but hasn't made an original blockbuster in nearly a decade. The former Facebook executive Josh Payne, chief executive of Nscale, raised $2 billion from investors, with Sheryl Sandberg joining his board as the cloud provider raises the largest deal of its kind for a European tech start-up.
Retail and Consumer
Pet owners are extending their health beliefs and practices to their furry friends, with the wellness industry booming. Hims & Hers wsj.com shares doubled on a report of a Wegovy tie-up, with the stock skyrocketing premarket following media reports that the maker of Wegovy plans to sell the weight-loss drug on the Hims & Hers platform. Consumers paid tariffs on overseas items and now want refunds as the Trump administration has yet to announce a process to return fees paid for tariffs now deemed illegal.
Legal and Regulatory
A group of states plans to sue over Nexstar's $6.2 billion acquisition of Tegna if it gets FCC approval. Phillips 66 ft.com changed its board to avoid a new proxy battle with Elliott, with the brokered peace drawing a line under one of activist hedge fund's most bitterly fought recent campaigns. The former coal miner in the middle of the AI data center boom raised $2 billion from investors, with Sheryl Sandberg joining its board.
International Developments
Kenya's capital was worst affected as floods killed at least 37 people after heavy rains in several parts of the country. Mexico's annual inflation bloomberg.com accelerated more than expected in February to breach the top of policymakers' target range. Thailand has set bloomberg.com a weekly cap on oil-price increases as it seeks to cushion the economy from the impact of the Middle East war. The Philippines' companies bloomberg.com are bracing for higher costs as oil's spike above $100 a barrel drags the peso to a record low.