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Welcome to Read Sunday☕️

Welcome to Read Sunday☕️

Written by William Lemanske

William Lemanske
March 10, 2024 • Estimated Reading Time: 12 minutes

Welcome to Read Sunday, your essential source for a concise and impactful weekly Business & Finance recap. Dive into the pivotal market highlights from the week, distilled for your convenience, and stay tuned for the thought-provoking editor's piece that rounds off your Sunday with insightful perspectives.

Market Recap

This Week’s Headlines

Economy & World News

In February, the U.S. economy saw signs of progress toward a "soft landing" with steady hiring and moderating wage growth. Employers added 275,000 jobs, significantly surpassing the 198,000 jobs economists had anticipated, according to the Labor Department. This development suggests that inflation may be controlled without triggering a recession. (WSJ)
Japan's main stock index, the Nikkei, reached a record high of 40,109.23 points on Monday, driven by corporate governance reforms and strong valuations that attract global investors. Technology stocks, following the lead of their U.S. counterparts, contributed to the 0.5% rise. (REU)
Advanced Micro Devices (AMD) encountered a setback from the U.S. government in its attempt to sell an AI chip specifically designed for the Chinese market. This is part of Washington's efforts to control the export of advanced technologies to Beijing. Despite AMD's efforts to comply with U.S. export restrictions by designing a less powerful chip for China, the U.S. Commerce Department indicated that the company must obtain a license from the Bureau of Industry and Security due to the chip's capabilities. (REU)
China has set a 5% economic growth target for 2024. Analysts say it's achievable with further stimulus in monetary, fiscal, and regulatory policies. (REU)
Fed Chair Jerome Powell emphasized the importance of not easing monetary policy too quickly, stating that the Fed will not reduce its target range until inflation is moving sustainably toward 2%. He highlighted the risks of lowering rates too quickly, which could hinder the fight against inflation, and the dangers of waiting too long, which could impact economic growth. (CNBC)
Egypt secured an $8 billion deal with the IMF, plus a $1.2 billion loan for sustainability, totaling over $9 billion in IMF support. This follows the central bank's decision to free its currency and hike interest rates by 600 basis points to stabilize the economy. (REU)
The People's Bank of China continued its gold-buying spree for the 16th consecutive month in February, adding about 390,000 troy ounces to its reserves. This ongoing purchasing has contributed to the recent surge in gold prices to record highs. Following the latest addition, China's total gold holdings now stand at approximately 72.58 million troy ounces, or around 2,257 tons. (BBN)
The European Central Bank held interest rates steady at 4% for the fourth time, citing a softer inflation and growth outlook. The ECB aims to maintain borrowing costs for a prolonged period to help achieve its 2% inflation target. (BBN)
China is mobilizing over $27 billion for its largest chip fund yet, aiming to accelerate the development of advanced technologies in response to the US efforts to curb its technological growth. The National Integrated Circuit Industry Investment Fund is gathering capital from local governments and state enterprises for its third investment vehicle, which is expected to surpass the 200 billion yuan ($29 billion) raised in its second fund, according to sources familiar with the matter. (BBN)

Public Markets

The EU fined Apple about $2 billion for unfair rules on music-streaming apps, marking one of its largest antitrust penalties. The European Commission ordered Apple to change its practices, signaling a potential wider conflict between the EU and the tech giant. (WSJ)
AWS plans to launch a new region in Saudi Arabia, investing over $5.3 billion to enhance cloud services and latency, and to support local talent development through innovation centers and upskilling programs. (AMZN)
The ransomware group ALPHV/BlackCat, responsible for the Change Healthcare attack, has gone dark after reportedly receiving $22 million in Bitcoin from the company. (CS)
Apple's iPhone sales in China fell by 24% in the first six weeks of the year. The overall mobile market in China shrank by 7%, with Vivo leading. In response, Apple and online resellers offered discounts to boost demand. (BBN)
Alibaba is leading a funding round of at least $600 million for Chinese AI startup MiniMax, valuing the company at over $2.5 billion. The investment marks Alibaba's second major AI deal this year, with Alibaba and HongShan (formerly Sequoia China) as key contributors. The fundraising is still in progress, and terms may change as more investors join. (BBN)
Novo Nordisk's Ozempic, a widely used diabetes drug, has shown promising results in reducing the risk of kidney disease progression and related health complications in diabetic patients with chronic kidney disease. In a late-stage trial, Ozempic decreased the risk of kidney disease progression, major cardiac events, and death by 24% compared to a placebo. These findings suggest that the injection offers broader health benefits beyond treating Type 2 diabetes. (CNBC)
Eli Lilly announced that the Food and Drug Administration (FDA) has unexpectedly postponed its approval decision for the company's experimental Alzheimer's treatment, donanemab. The FDA intends to convene a last-minute meeting of its external advisors to further evaluate the treatment's safety and efficacy. The decision was initially anticipated by the end of the first quarter, following a previous delay from an expected approval last year. (CNBC)
United Airlines executives stated that the carrier's growth will be slower than anticipated due to delays in Boeing's deliveries. Originally expecting to receive 77 Boeing 737 Max 8 and 9 planes this year, the airline now forecasts it will receive only 56. Consequently, United has informed its pilots that it will pause hiring new aviators in May and June. (CNBC)
Taiwan Semiconductor Manufacturing Co. (TSMC) is expected to receive over $5 billion in federal grants to support a chipmaking project in Arizona. This move is seen as a significant step in President Joe Biden's initiative to revive semiconductor manufacturing in the United States, according to sources familiar with the matter. (BBN)

Real Estate

Orafol, a German manufacturer, is close to finishing the first phase of a $100 million expansion in Oakland County, Michigan, driven by relocating production from Europe. The company, known for making wraps and decals for the automotive and other industries, is constructing a new 112,000-square-foot factory in Orion Township along Lapeer Road and plans to renovate and enlarge its nearby office building. (CRAIN)
The former Dairy Queen property in Times Square, Fort Myers Beach, sold for $6.4 million to Persaud Properties. The iconic Dairy Queen had been a local attraction for decades near the Fort Myers Beach Fishing Pier. The property deal closed on February 28, with the land previously owned by Elizabeth and William Whitaker since 1981, who bought it for $681,000 from Frank and Rebecca Hemelgarn. The Hemelgarns originally developed the land into a Dairy Queen in 1971. (FMB)
Simon Property Group is investing $400 million to transform Southdale Center in suburban Minneapolis into a multi-use destination beyond just shopping. Over the last 12 years, the mall has added luxury apartments, an extended-stay hotel, a Shake Shack, a high-end fitness center, and co-working space, replacing a former JCPenney. A defunct department store has been replaced with an upscale grocer and a high-tech minigolf operator. A cluster of luxury shops, including Gucci, Burberry, and Moncler, is currently under construction. (WSJ)
New York Community Bancorp (NYCB) recently reported substantial losses and anticipated further challenges, citing troubled loans in the New York City apartment market. As the city's largest lender for rent-stabilized apartments, approximately $18 billion of NYCB's loans are backed by these units, constituting over 20% of its total loan book. (WSJ)
Aldi, the German-owned, Illinois-based grocery chain, announced plans to open 800 new stores in the U.S. within the next five years. The expansion will focus on the company's strongholds in the Northeast and Midwest, as well as in the western U.S. and Southern California, including a new location in Las Vegas. (CNBC)
Joann Inc. is reportedly planning to file for Chapter 11 bankruptcy protection as soon as next week, according to Bloomberg. Current discussions suggest that lenders may take over the company in exchange for shedding debt. If the bankruptcy occurs, it is expected to be a quick process. This development could be another setback for landlords in metro Detroit. (CRAIN)

Mergers & Acquisitions

KKR & Co. is reportedly negotiating to acquire German renewable-energy producer Encavis AG in a deal that could value the company at over €2 billion ($2.2 billion). (BBN)
New York Community Bancorp raised $1 billion from investors, including Steven Mnuchin's Liberty Strategic Capital, and named a former Comptroller of the Currency as its new CEO. Other investors include Hudson Bay Capital, Reverence Capital Partners, and Citadel Global Equities. (REU)
JetBlue Airways Corp. officially ended its attempt to acquire Spirit Airlines Inc. after a federal judge halted the $3.8 billion deal due to antitrust concerns. The airlines agreed to part ways, acknowledging that necessary approvals were unlikely to be obtained by the set deadlines. JetBlue announced that it would pay Spirit $69 million to settle all matters related to the deal, as the company also faces pressure from activist investor Carl Icahn to focus on sustainable growth. (BBN)
Legislation to ban or force the sale of TikTok in the U.S. is advancing in the House, catching the app off-guard and prompting interest from potential buyers. Lawmakers have expressed concerns about TikTok's ties to China and its potential to influence Americans' political opinions. However, there are also fears of backlash from the app's large user base. (WSJ)