This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
OPEC+ extends cuts
OPEC and it allies agreed to extend official crude production cuts into 2025 amid lackluster demand. A smaller group from the alliance, including Saudi Arabia and Russia, will also extend voluntary cuts of 1.7 million barrels per day. Saudi Arabia’s energy minister Prince Abdulaziz bin Salman said OPEC+ wants concrete rate cuts before factoring in the potential impact on energy demand. Separately, oil giant Saudi Aramco began a massive share sale to raise around $12 billion to fund the country’s continued attempts to diversify its economy.
New AI chip Rubin
Nvidia unveiled its next generation artificial intelligence chip, Rubin, a mere three months after launching its Blackwell model. This accelerated pace of development comes as competition intensifies from AMD and Intel and tech giants like Microsoft, Google and Amazon invest in their own AI chip designs. Rubin, slated for a 2026 rollout, will feature new graphics processing units, central processing units and networking chips.
Dow posts best day in 2024
The Dow Jones Industrial Average was up more than 550 points after the Federal Reserve’s preferred inflation measure cooled. Salesforce and UnitedHealth gave the Dow the upward momentum. The S&P 500 added 0.8%, while the Nasdaq Composite ticked lower as Nvidia and Tesla declined. The S&P 500 and the Nasdaq posted losses for the week, ending a five-week winning streak. For the month, the Dow was up 2.3%, the S&P gained 4.8% and Nasdaq climbed 6.8%. With inflation matching economists expectations, the yield on the 10-year Treasury dipped to 4.501%.
Ackman to raise $1 billion
Billionaire investor Bill Ackman is selling a 10% stake in his hedge fund, Pershing Square, at a $10.5 billion valuation. The firm hopes to raise $1.05 billion through this sale. This move is intended to pave the way for an initial public offering. The sale is expected to attract new investors and provide liquidity for existing ones. Pershing Square had $18.6 billion in total assets under management as of the end of April.
Moderna gets RSV approval
The Food and Drug Administration approved Moderna’s respiratory syncytial virus vaccine for people over 60 years old. This is Moderna’s second product to enter the U.S. market and it is the first mRNA vaccine approved for a disease other than Covid-19. The vaccine is expected to compete with similar shots from GSK and Pfizer. It’s a crucial new revenue stream for Moderna amid declining demand for its COVID vaccine.
[PRO] Buying volatility
Have you ever wondered what institutional investors mean when they say “buying volatility” or “selling volatility?” And is this something retail investors can do? CNBC’s Michael Khouw explains all.
The bottom line
Indian Prime Minister Narendra Modi is on course to win a rare third term, while South Africa’s ruling African National Congress lost its 30-year parliamentary majority. U.K. Prime Minister Rishi Sunak looks set for defeat in next month’s election.
As significant as these elections are, there is one that will have truly global resonance: the election of the leader of the free world in the world’s biggest economy. Last Thursday, a New York jury found former President Donald Trump guilty on all 34 felony counts of falsifying business records in his criminal hush money trial.
Shockwaves from the jury’s decision immediately rocked Trump Media & Technology Group shares, which fell 15% in extended trading. Trump owns about 65% of the company, a stake valued at approximately $5.7 billion. On Friday, the stock ended down 5%, valuing Truth Social’s owner at $8.7 billion. This valuation is entirely based on Trump’s brand and personal following.
According to the company, most of its 621,000 shareholders are retail investors. Its first filing as a public company revealed first-quarter losses of $327.6 million on less than $1 million in revenue.
“It’s a meme stock that has no fundamentals,” Art Hogan, chief market strategist at B Riley Wealth, told Reuters. “The valuation of that stock has always been a bit of a question mark. It certainly isn’t making any money and is trading almost at an unfathomable level.”
Trump’s megadonors shrugged off the verdict. Ahead of the decision, Blackstone CEO Steve Schwarzman told Axios that he planned to vote for Trump, and hedge fund executive and billionaire Bill Ackman is also likely to support Trump, according to people familiar with the matter.
While the verdict had little impact on the broader market, it did make global headlines and had social media abuzz. After all, Trump’s legal problems will not prevent him from running for president, and if his first term is any indication, world leaders will be wary.
His presidency saw a trade war with China, a destabilization of the Turkish lira and tweets warning OPEC about “oil prices getting high.” His pronouncement were, often, market moving events.
As earnings season winds down, attention will shift to May’s nonfarm payrolls report on Friday, which will shed light on the health of the labor market and the economy.
But strategists anticipate increased market volatility in the coming months as the 2024 election approaches, potentially becoming a significant market mover. “Without a near-term catalyst, stocks will continue to ‘chop around,'” wrote Wells Fargo equity analyst Christopher Harvey in a Friday note. “Politics remain a wild card.”
— CNBC’s Ruxandra Iordache, Natasha Turak, Brian Schwartz, Alex Harring, Sarah Min, Rebecca Picciotto and Annika Kim Constantino contributed to this report.