U.S. Inflation Eased to 5% in March, Lowest Level in Two Years

Market Movers

• US inflation eased to lowest level in nearly two years. The consumer price index for March rose by 5 per cent year-on-year. That marks a significant deceleration* compared with the 6 percent recorded in February as well as the lowest level since May 2021. On a monthly basis, consumer prices increased just 0.1 per cent, shy of economists’ forecasts.

• Substack’s Twitter-like feature goes live. Substack is long-reads only no longer. The newsletter publishing platform launched a feature called Notes for sharing brief posts, links, images, and GIFs in a news feed layout that will feel familiar to Twitter users. Substack envisions its writers engaging readers with pithy posts on Notes.

• EY scraps break-up plan after months of internal dissent. EY’s powerful US partners squashed the deal. EY has opened up a huge debate across the profession. But so far, the other big firms have been watching this debacle, and that’s what it is ultimately at EY, this debacle, and saying they don’t want to follow in EY’s footsteps. Source(3:36)

• South Korea fines Google $32 million. Alphabet Inc.’s Google ($GOOG) was fined 42.1 billion won ($32 million) for using its clout in the mobile app market to squeeze out a local rival, the latest sign of intensifying scrutiny on the US tech firm* as it seeks to expand overseas. Google tried to block Korean platform rival One Store Co.’s growth, Korea’s Fair Trade Commission said in an e-mailed statement.

• NYPD to deploy robotic dogs. The initiative includes the deployment of a “K5” unit in Times Square that will help beat officers with surveillance.* The city also acquired two robotic dogs—which the NYPD calls “Digidogs”—that will be used at incidents such as hostage situations, officials said. Another device will shoot tracking devices onto suspect vehicles.

• Sony backs maker of tiny Raspberry Pi computers with fresh funding for AI. A deal that will let users and developers make visual sensory applications using its AI chips. The firm raised the cash at the same $500 million valuation it was worth in a 2021 funding round. It comes at a time of elevated hype around artificial intelligence, boosted by the buzz surrounding ChatGPT.

What to Watch

• Bank volatility to cut U.S. economic growth, IMF says. U.S. banks’ lending capacity will decline by 1% this year due to the fall in the value of many bank stocks as investors reassess the health of midsize banks. That reduction in lending is expected to shave 0.44 percentage point* off U.S. gross domestic product in 2023.

• Carrier plots separation of Fire Unit. The company is working on a plan to sell or spin off its Fire & Security business segment, which accounts for about 17% of the air-conditioning company’s sales. The process is in an early stage* and there is no guarantee the company will follow through.

• Glencore revises bid for Teck Resources to allay coal concerns. Glencore said it would add a cash component to its roughly $23-billion merger proposal* for Teck Resources Ltd., as the commodities company seeks to win over the Canadian miner’s shareholders for a deal that would create a copper giant.

• Hyundai commits to $18 billion spend in shift to electric cars. The group, which also set itself a goal of becoming one of the world’s top three EV makers, plans to boost its annual output* of electric cars in Korea to 1.51 million units by end of this decade, or about 40% of estimated global EV production of 3.64 million, according to an e-mailed statement Tuesday.

• 1 key metric for earnings season. If the upcoming earnings season tells us anything, it will be which companies are getting better (or worse) at managing their inventory. It’s not going to show up in revenue but in the cash dynamics of the company because that’s where you see inventory going up and down. Source(9:11)

• JMP says Shopify stock could surge 45%. Shares of the e-commerce company gained 2.4%* after JMP upgraded Shopify to market outperform from market perform. The firm assigned the company a price target of $65 per share, implying a 45.1% upside from Tuesday’s close.

• UBS says it’s time to buy Goldman Sachs. The banking giant rose slightly after UBS upgraded the stock to buy from neutral, saying the company is attractively priced with minimum risk ahead.* Analyst Brennan Hawken increased his price target to $385 from $350, suggesting shares stand to gain 17.6% from Tuesday’s close price.