Here are the most important news, trends and analysis that investors need to start their trading day:
1. Wall Street looks higher but key Treasury spreads remain inverted
Traders on the floor of the NYSE, March 31, 2022.
US stock futures rose modestly Monday, with the tech-heavy Nasdaq looking the strongest. Twitter shares soared 25% in the premarket after Elon Musk revealed a big stake in the social media company. The second quarter on Wall Street got off to a positive start on Friday, which was also the first day April. Historically, April has been the best month of the year for stocks, with the S&P 500 gaining an average 1.7%. The first quarter, which ended Thursday, was the worst first three months in two years, which included the Covid pandemic lows in late March 2020.
Key bond yield spreads on Monday — the 2-year/10-year and the 5-year/30-year — remained inverted, a market distortion that’s happened before past economic recessions. Bond yields pink Friday. But the real strength was among shorter-term Treasurys as traders worried that the weaker than expected but still robust March jobs growth might give the Federal Reserve the green light to get more aggressive with its interest rate-hiking cycle.
US oil prices jumped 3% on Monday, above $100 per barrel as supply concerns due to disruptions from Russia’s Ukraine war persisted. Crude did fall about 13% last week after the US announced it will release 1 million barrels per day of oil from its Strategic Petroleum Reserve for six months starting in May to help combat elevated energy costs.
2. Twitter shares soar after Elon Musk takes a big stake in the social network
Tesla Inc CEO Elon Musk attends the World Artificial Intelligence Conference (WAIC) in Shanghai, China August 29, 2019.
Ali Song | Reuters
Musk, the outspoken Tesla and SpaceX CEO and the richest person in the world, has become Twitter’s largest outside shareholder, not long after criticizing the social network for what he said was its falling down on free speech. According to a regulatory filing, Musk owns nearly 73.49 million shares of Twitter.
That’s a 9.2% stake, worth $3.6 billion based on Twitter’s premarket surge to more than $49 per share. While classified in the filing as a passive stake, investors were bidding the company’s shares higher on the chance that this could lead to something more.
- Over the weekend, Tesla reported first-quarter electric vehicle deliveries of 310,048, slightly below estimates but 67% more than a year ago. Model 3 and Model Y vehicles comprised 95% of Q1 numbers. Deliveries are the closest approximation to sales numbers reported by Tesla.
3. Starbucks ends share buybacks as Howard Schultz returns as interim CEO
Pier Marco Tacca | Getty Images
Starbucks shares dropped roughly 2.5% after the coffee chain suspended its stock buyback program. Howard Schultz who’s returning as interim CEO of Starbucks, wrote in a message to employees: “Starting immediately, we are suspending our share repurchasing program. This decision will allow us to invest more profit into our people and our stores — the only way to create long-term value for all stakeholders.”
- With Schultz steering the ship for the time being, his third tenure at the helm, Starbucks has said it’s looking for a permanent CEO after Kevin Johnson retired.
4. Jamie Dimon highlights three forces likely to shape the world
JP Morgan CEO Jamie Dimon speaks at the Boston College Chief Executives Club luncheon in Boston, Massachusetts, US, November 23, 2021.
Brian Snyder | Reuters
Jamie Dimon, CEO and chairman of the biggest US bank by assets, pointed to a potentially unprecedented combination of risks facing the country in his annual shareholder letter. JPMorgan’s Dimon wrote that three forces are likely to shape the world over the next several decades: a US economy rebounding from the pandemic; high inflation that will usher in an era of rising rates; and Russia’s invasion of Ukraine and the resulting humanitarian crisis. Dimon also said he believes the US was in the midst of a boom that could “easily” run into 2023.
5. Ukrainian President Volodymyr Zelenskyy accuses Russia of genocide
Ukraine’s President Volodymyr Zelenskyy speaks during an address, condemning what he says are war crimes of Russian troops in the settlements around the Ukrainian capital, as Russia’s attack on Ukraine continues, in Kyiv, Ukraine April 3, 2022.
Ukrainian Presidential Press Service | Reuters
Ukrainian President Volodymyr Zelenskyy accused Russian forces of committing genocide, saying Sunday morning that his people were being “destroyed and exterminated.” Zelenskyy’s comments came in the wake of the reported devastation in Bucha, a town 23 miles northwest of the capital city of Kyiv, which has been liberated by Ukrainian forces. In a video shown during Sunday night’s Grammy Awards, Zelenskyy implored artists to support Ukraine.
- The US and its European allies are preparing to levy more sanctions on Russia following mounting evidence of war crimes committed by its forces in Ukraine.
- Russia’s chief negotiator said draft peace treaty talks will resume Monday, but stressed that the Kremlin’s position on annexed Crimea and separatist parts of the Donbas region remains unchanged.
—CNBC reporters Samantha Subin, pippa stevens, Vicky McKeever, Fred Imbert, Lora Kolodny, Hugh Son and Natasha Turak as well as The Associated Press and Reuters contributed to this report.
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