Following a wild trading session, U.S. Equity Markets closed lower across-the board with the Dow leading the move, closing lower by 0.77%. However, Futures markets have soared in after hours following the results from Nvidia. During a conference at the Richmond Fed, Dallas Fed President Lorie Logan emphasised the importance for U.S. banks to be ready to borrow from the Federal Reserve’s discount window on a regular basis. She also stressed the need for the Fed to ensure that loans can be accessed at any time, considering the evolving speed of banking and transactions. According to a recently released paper by former Federal Reserve Chair Ben Bernanke and Olivier Blanchard, a former International Monetary Fund chief economist, the Federal Reserve still has work to do in order to bring inflation down. Despite a recent cooling of inflation, the Fed may need to take further action to address the issue. Jensen Huang, chief executive of Nvidia (NVDA), the world’s most valuable semiconductor company, warned lawmakers in Washington that the U.S. tech industry is at risk of ‘enormous damage’ if the ongoing economic cold war between itself and China persisted. Huang added that China would just bring chip development in house in the absence of U.S. firms in its market – which would be a major blow for the tech industry. Apple (AAPL) signed a new multibillion-dollar deal with Broadcom (AVGO) to develop 5G component parts for its cellular devices. The collaboration will be based within the U.S. and is part of a broader domestic investment initiative from Apple that was announced in 2021. Netflix (NFLX) is cracking down on account sharing in the U.S. and has introduced new account sharing add-ons for customers. Those who share their passwords will have the option to continue sharing for an extra $8 per month. This option is available only for customers on the $15.50 standard plan and $20 premium plan, with the aim of encouraging individual subscriptions and limiting account sharing to within households. PacWest Bancorp (PACW), in an effort to boost confidence in the bank, has agreed to sell its real-estate lending arm. Roc360, a real-estate lending firm, will acquire PacWest’s Civic Financial Services unit, which focuses on lending to landlords and investors involved in purchasing and renovating homes for resale. Palo Alto Networks (PANW) raised its revenue forecasts as customers have opted to bundle cybersecurity needs with one provider as they attempt to reduce costs. While the firm admitted the current state of the market has worsened since the start of the year, it said that it expects demand headwinds to ease significantly heading into 2024. European Markets closed lower. In April, U.K. inflation experienced a significant decline, primarily due to the retreat of energy prices. The Office for National Statistics reported that headline CPI inflation stood at 8.7% year-on-year, a decrease from the 10.1% recorded in March. Although this figure surpassed the consensus estimate of 8.2% from a Reuters poll of economists, it still indicates a notable drop in inflationary pressures. In Asia, the latest Reuters Tankan poll reveals encouraging developments in the Japanese economy. For the first time this year, there has been a shift towards positive business sentiment among major manufacturers. This indicates growing optimism within the manufacturing sector, which is a crucial driver of Japan’s economy. Furthermore, the service sector has also witnessed an improvement in morale, reaching its highest point in five months. The Bank of Korea is expected to maintain its policy rate for the third consecutive meeting amid concerns over inflation and a slowdown in economic growth. All 17 economists surveyed anticipate that the central bank will keep the seven-day repurchase rate at 3.5%, the level it has been since January. Additionally, the Bank of Korea will provide updated forecasts for important economic indicators, including growth and inflation. Elsewhere, Oil rose 0.70% while Gold fell 0.80% following another volatile trading session.
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