All right. We are pretty much at record highs on stocks. 30 minutes till the start of the cash trade. I'm Matt Miller.
I'm Dani Berger. Bloomberg Open Interest starts right now.
You remember this time yesterday, I predicted that we would hit a record high and we were so far away. To be clear, we haven't done it. We're one point away from a closing high.
Yes, 1.0. You're one point away from seeing into the future.
Well, it'll happen today if we get the right Trump truce. Stocks are at 6967 on the cash trade. Rising hopes for peace. The US and Iran agreed in principle to extend their cease fire. And meanwhile, earnings are in full swing. Morgan Stanley and Bank of America traders join Wall Street's record windfall. And PIMCO bought all $400 million of the bonds sold by Blue Owl investment grade debt. Just a big vote of confidence in a battered private credit market. And I want to be excited to talk about because we spoke with Christian Strauch not that long ago who said everything that's being sold out there does not look good.
None of it's good. We'll take it. It's six and a half percent. We'll take you there.
Yeah. Meanwhile, Matt, I am looking at the banking stocks after they reported earnings this morning. Bank of America and Morgan Stanley rounding out the big bank earnings. It was the same story, record equity trading revenue for the first quarter. A lot of market volatility that they capitalize on. The consumer is still healthy in spending. Bank of America also announced that they had a $20 billion exposure in private credit. That is the smallest of all the banks that reported that. Big America up 1.7%. Morgan Stanley, 2.7.
All right. So big banks are done. We got to talk about banker. No, I mean, we're obviously going to have to write for the week. But yeah, yeah, they're they're all of hours, couple of hours. In tech news, Snapchat is cutting about 1000 jobs as it struggles to reach profitability. That's about 16% of its staff. Meanwhile, Meta and Broadcom expanded their multibillion dollar partnership for custom A.I. chips that will help Meta reduce dependence on suppliers like Nvidia and AMD. You can see that tech stocks are up across the board in Snapchat, which, yes, Snapchat still exists up 7.7%.
Matt, it doesn't only exist, but like the kids use it, to be clear, it's popular still.
Yes. I mean, I'm not one of them because I'm not a kid, but it is popular. Let's get back to our top story, the bank earnings. Bloomberg finance reporter Paige Smith joins us. So, Paige, we wrapped all of them up. What's been the big takeaway this quarter?
Thanks for having me. I think it would be very fair to say that all week we've been monitoring the bank earnings basically since Monday when Goldman kicked off this sort of crazy news of reporting. Equities desks in particular that have been just on a tear. It's been a very, very busy it was a very busy first quarter for the equities desks across the Wall Street banks, I would say, but to zero in specifically on Bank of America and Morgan Stanley that reported today. Both of those firms also reported very strong earnings and equity desks. But just to kind of change tack a bit, since I'm a consumer finance reporter, it was I would like to focus in a bit on the consumer spending trends that Bank of America reported today because they were also quite strong. And that was certainly a question, given all of the volatility and other questions about the geopolitical uncertainties that we are all sort of considering and talking about in any given moment. So I would say that those were sort of the two points to focus on at the moment. Private credit is something that they're giving a lot more transparency on and we're going to talk about in a little bit all the debt that private credit and Goldman Sachs also selling debt to support its private credit fund.
Does it look like everything's cool? Nothing to see here. We can move on.
I think that we still there is still runway ahead. I think we should certainly still be watching it closely and asking questions about private credit this moment in time. But certainly, I think it would be fair to say that a number of the banks were much more forthcoming and transparent about their exposures to private credit. Bank of America broke out a specific slide in its presentation, sort of explaining, as you said just now, Matt, of, hey, listen, there's nothing really to see here, but certainly a question. And I think it's one that folks will continue to ask about.
All right, Paige, thanks very much for joining us. Paige Smith there talking to us about the banks. We are going to continue to talk about banks. Herman Chan coming on from Bloomberg Intelligence and Morgan Stanley's CEO Ted Pick joins us right here on Open Interest. That is at 1030.
Is it at 1030? Is it going to be at 1030 for me?
Not at 1045. It's at 1030.
At 1030. I'm nervous to say 100% because you know what? If he's late, what if that's fair? I just want to make sure it's exactly at that time, because sometimes producers give me times that are not true and I want to make sure that we value our clients' time.
Yes. So we think that in 30 is when that is going to happen. Elsewhere in markets, SNAP is laying off around 16% of its workforce to reduce cost and reach profitability. Bloomberg Tech's Caroline Hyde joins us to explain this and other big tech news of the day. Caroline, Beatrice, do you use SNAP?
No, I'm not one of the almost billion people that use this on a monthly basis. That's a lot of people using this. It's just it's my iPad, not me.
Right. So that's the generational divide. It's still not profitable, though. In fact, the people who use in our editorial meeting, we were looking at Snapchat. We were using the model function to look at their profitability or rather lack thereof, because they have never posted a profit. And that is the focus of activist investors that have recently got involved in the stock and why we're seeing the executives realized that they need to sell, need to save almost $1,000,000,000, half of a billion every single year. $500 million is what they're promising to save by. Yes, it comes of people. So once again, we've got this sad, but the fact of the matter that we're going to see enormous about 60% of the workforce, about a thousand people go, but also the 300 people that have been actively looking to hire are also going to be stopped as well. Those open positions are not going to be filled. People are backfilling using AI. That is what I'm hearing time and time again from CEOs. If we're going to see someone depart, try and do it with artificial intelligence before you create yet more headcount. That's kind of what they're hinting at a little bit here. But this is a drive for profitability and a drive for a company that is focused on eyeglasses. All glasses, when they're just up against huge competition, competitive threats, who are deploying massive amounts of money into the future of AI and into the beefing up of that capital expenditure. This is a company that is now worth just $9 billion, easily worth 130 billion. Well, so a company that is much bigger that's moving this morning, as is Broadcom, and they've signed this partnership with Meta. I thought these two were already already had ties together. So what now?
Meta has already been saying, I want to build my own chips. I want to design them, and I want to have Broadcom help me do that. But remember, they're also deploying some six gigawatts of energy compute coming from AMD. They have an awful lot of chips coming from Nvidia. But most of these large language model makers, providers, labs want to have a little bit more control on their own destiny. They want to have to not have to sacrifice so much margins going out to the use of CPUs so they can design themselves. Look, Hock Tan is actually been on the Meta board for years. He's not going to be stepping down. But the initial deal is for one gigawatt amount. That's like one nuclear reactors worth of energy to deploy and compute. So that's the amount of chips that are gonna come from Broadcom to begin with, but it's going to expand and this is going to be a significant relationship going forward, but it still remains a significant relationship with Meta, with AMD, with Nvidia. Very these companies need more and more, more so the broadening is just going to continue.
All right, Caroline, thank you very much. Bloomberg Tech's Caroline Hyde. In other tech news, I feel like I've just got to mention this, Matt, and a news update from Allbirds, the shoe company, which famously has dropped a lot in valuation. I mean, it's literally the worst offender in terms of office fashion in the history of offices. I'm actually interested if you've seen this story. Caroline, let me let me read let me read you some quick headlines. Inexcusable Birds announces expansion into AI compute infrastructure and that they're changing their name to New Bird A.I.. They're not a shoe company they're in today in datacenters. Is this why? What is the infrastructure that they already have that they can easily deploy? Because remember, a lot of crypto miners suddenly became compute providers. But what is it space that they're offering? Do they have manufacturing warehouses that they can suddenly shovel a load of chips into?
It's going to all those. They're going to have a $50 million convertible financing facility, and that will allow it.
Yes. And apparently that's enough to pivot into infrastructure. And that's the world we live in. It's shocking. Yeah, but not so company. I don't know about you guys. I can only hope I can become one.
Thank you so much, Caroline Hyde. Of course. Check out Bloomberg Tech every day at 11 a.m.. Elsewhere on the war, the AP reporting that the US and Iran agreed in principle on extending the cease fire to allow for more time for President Trump for diplomacy. President Trump spoke on Fox Business.
I think it's close to home. I mean, I view it as very close to over. You know what? If I pulled up stakes right now, it would take them 20 years to rebuild that country. And we're not finished. We'll see what happens. I think they want to make a deal very badly.
Joining us now is Tyler Kendall, Bloomberg, Washington correspondent. The president also saying to the New York Post yesterday, Tyler, that talks could be happening over the next two days in Pakistan. Where do we understand about where these negotiations stand?
Hey, Danny. Well, at this point, our main reporting remains the same, which is that it appears that both the US and Iran are working towards another round of in-person talks. Now, as you mentioned, this headline from the Associated Press that the sides have agreed in principle to an extension of the cease fire. I will point out we got another headline from Axios earlier today saying that the US has not agreed to that yet, but that progress is moving in the right direction because at this point it does appear that diplomacy is still a viable option. Though it is an understatement to say there is still so much to tackle. As President Trump yesterday, for example, indicated in an interview that he was not happy with reports that the US had floated to Iran a 20 year moratorium on uranium enrichment, instead saying that he does prefer a permanent ban. Plus pair that with other headlines from this morning, which do remind us that escalation is still on the table, including from Iranian state media, saying that if the US blockade continues, that would be considered, in their view, a violation of the cease fire, as Iran's military is now threatening to halt any shipments in the Persian Gulf, the Gulf of Oman and the Red Sea. But Matt and Danny, we got this statement overnight from CENTCOM confirming that they have stopped all commercial traffic when it comes to those waterways. A senior U.S. official has outlined to Bloomberg News that they are dispersing vessels in the Gulf of Oman instead of directly near the Strait of Hormuz in a bid to give the U.S. some more flexibility.
Yeah, it's interesting because President Trump just last night told ABC News he did not see any reason to extend the cease fire. So we're getting conflicting messages here from the president and AP, but that's not really a surprise. Tyler Kendall, thanks very much, reporting out of Washington. A quick check on what's going on in markets. We're looking at S&P futures and Nasdaq futures that are really little changed. But we closed again yesterday on the cash trade at 69, 67. So one point away from an all time closing high on stocks and much higher than we were or let's just say higher than we were on February 27th before we invaded Iran together with Israel. Let's get a look at some of the other movers on our radar this morning. Quantum stocks are surging after Nvidia unveiled new models meant for quantum computing. So these tiny meme stocks are running out of stocks. I feel like every day there's an IPO of some some quantum stocks. I feel like Dan Curtis, our London producer, is obsessed with quantum dots. Is that why we're talking about.
That's why. Well, they're rallying.
Yeah, they're anywhere up. Unfortunately, this is the one I have to discuss. American Eagle, they're climbing after announcing a new campaign with me. A hater.
Now, I don't know. I don't know. I'm a hater. To be fair, it's worked out very well for American Eagle. So good for them. This time it's promoting shorts. It's called Sit for Short, and clearly it's very successful for them. Some people wear jorts.
I know shorts. I am not a giant hater, but I hope you don't wear Allbirds. The shoe company is making a huge pivot to compute infrastructure. That is correct. The shoemaker Allbirds that did business casual something dirty is now transforming itself into a neo cloud computing company called What's it called again? It's called New Bird.
Yes. New Bird. A new bird. And to be clear, Allbirds, they did just get sold to a company that owns a bunch of other apparel companies. I'm a little I'm I'm all all around confused by this. It is massively rallying almost 200% to seven reasons crazy. Coming up on the show, PIMCO buying all $400 million of bonds sold by a blue owl private credit fund. We'll have the details for you next right here on Open Interest.
Let's getting out of high interest liquids making headlines around the world. Starbucks is turning chat GPT into your personal barista. The coffee giant is testing a chat powered feature that will let customers personalize their drinks inside the agent. Several major retail brands, including Walmart, Target and Target, I should say, have partnered with open AI to integrate chat CBT into their shopping experience. I don't understand what it could do to coffee, but we'll see. And I am old. S&P Global is warning that a small group of big banks funding hedge funds could pose a growing risk to financial stability revenues from this kind of financing. Major investment banks, including Goldman Sachs and Morgan Stanley, jumped 25% to $24 billion with trillions in lending and echoes of Archegos, regulators are watching for cracks as risk is concentrated in fewer banks and private credit may maybe turning a corner. PIMCO bought the entire $400 million Blue Owl bond deal at six and a half percent, while Goldman Sachs raised $750 million in a second offering at two and a half percent. It's the latest sign that demand is back after months of redemption pressure. It's marked a shift from just a few weeks ago when PIMCO CEO Christian Stracke joined Open Interest, expressing his caution about those private credit assets.
A lot of the loans that are out for sale right now are pretty bad loans. So, you know, we've we've seen some blocks of those and they're not clearing at a price where yet where we would be interested in buying them.
Let's get more on PIMCO and with Bloomberg credit editor Bruce Douglas. Bruce, I just wonder, listening there to Christian saying they're not at a price yet where we jump in. Is that a sign that there was a steep discount on some of these assets that made it attractive for PIMCO to jump in and buy all $400 million worth of them?
Well, essentially, they're buying an investment grade rated product for a yield of about six and a half percent. So that's pretty pretty attractive pricing for something that is ultimately, even if it's at the bottom of the investment grade scale, is is quite highly rated. So, yeah, I mean, PIMCO has been a longstanding critic of private credit. So the fact that it's now buying in in this big way is suggesting that maybe the private credit winter is starting to thaw.
So contrast that with the Goldman Sachs bond deal. It's larger, $750 million, but I see two and a half percent figure there rather than six and a half percent.
Yeah. I mean, I think that it's is two and a half percent over over treasuries there. So that's still kind of decent, a decent spread. And I think that, you know, the Goldman Sachs deal, again, that's a that's a non traded business development corporation. That's obviously the kind of thing that we've seen a lot of these redemption requests from in in recent months. But what this really shows is both the the the PIMCO buying the the the Goldman Sachs sale is that institutional capital is kind of back in in a significant way in private credit. The just as we've seen in recent months have come from retail investors keen to get their their money back and finding it's not quite that easy when you have invested in illiquid assets. But now institutional capital appears to to see value in private credit. We've had BlackRock the other day talking about strong demand from institutions and that's really what these two big debt sales in the last few days have shown us.
By the way, two and a half percent over Treasuries is then I mean, it depends on obviously the duration, but ten year treasuries are four and a quarter. So that's more than six and a half. Yeah. So is it five year? Ten year?
I think so. Yeah. It's it's it's a decent spread.
Bruce, just quickly, in terms of institutions, I mean, were there ever any concerns about them? Did they ever back out? That feels like a pillar that's held up well, but don't they need retail? Some of these giants, if they really want to achieve the growth that they're targeting?
Well, it is obviously a very interesting point in private credit's development. It's coming at a time when the Trump administration is pushing for opening up 41 KS to retail investors. And yes, clearly, retail is seen as a potential source of growth. But there are other sources of potential growth, particularly from the insurance industry, that private credit may be looking to tap for the next stage of its development. So obviously, the jitters in retail, we don't know whether that be passing or whether they're here to stay. But private credit does have other potential sources of growth as well.
All right, Bruce, thanks so much for joining us. Bruce Douglas there. Appreciate your reporting and clarification there on the spreads. Really interesting story. We'll continue to follow this coming up. Imran Khan says markets are under appreciating risks from the war as earnings kick off. He'll join us next. This is Bloomberg Open Interest.
We have a classic energy price shock unfolding across the world as we speak. That, of course, will create demand destruction. It will cause economies across the world to decelerate. The risk of recession has increased and central banks are making some really difficult decisions. This really is a very, very treacherous moment for the world economy.
Citadel CEO Ken Griffin speaking at the Centre for World Economic Forum, the 2026 summit. Joining us now is Northstar Asset Management, chief investment Officer and Nimrod Kagan. Great to see you. And. Is this a treacherous moment for the global economy? And if so, why are stocks less than 2/10 of a percent away from all time highs?
Danny does feel like a treacherous moment, but we've been here so many times before. But this is a market that just wants to keep going up. You know, we've been conditioned over the last 18 day, 18 years to buy the dip, and that's what the market is really responding to. But you're right. I mean, under the under the hood, there's a lot of violent rotation going on. It again points to we just want this market. This is a market that wants to keep going up, but not really sure how. So we keep bouncing from a sector to sector, hoping that something's going to actually work out.
So what has been working out? What does the rotation look like to you throughout this six weeks of war?
Yeah, I mean, you look at it, you just take an example of consumer staples. You know, earlier first two months of the year, we had a big defensive rotation, also small cap value. Those were the sectors outperforming. Then we go into the war, everything sells off pretty much evenly. Stagflation, fears and then bouncing out of the war are bouncing. We're still in it, but bouncing in. In April, we've seen where, you know, consumer staples is kind of flat and we've seen a resurgence again of your growth sectors. Some of the other areas that were lagging behind. So this complete rotation going on.
All right. We're going to keep you with us through the opening bell. In terms of futures, we are seeing just a very slight gain. We'll be back with the NYSE and the Nasdaq. This is Bloomberg.
We are moments away from the start of trading. This is Bloomberg Open Interest. I'm Matt Miller. We're not seeing a lot of action in futures, although green arrows and they're moving higher to the upside right now. Over 7000 and S&P futures over 26,000 on Nasdaq futures. You hear the opening bell we see down at the New York Stock Exchange. A few people ringing the bell for Vikings. Not a very big showing for exploring the world in comfort. Maybe an office on a cruise and without kids.
Yeah, what a shame. There's no kids on a Viking cruise.
I have bad news for you When you look over to the. Oh, no. There's one small tribe. No, no children at the NASDAQ. No children here. We have some brothers that are stoked at the Metals Royalty company ringing the bell there at the Nasdaq. Yeah, there's the Viking ad, it sounds like. I don't know, They. They hate children. Nobody's supposed to be like luxury cruises. They're more expensive. They have less people. I think they're not. They're like the anti Disney cruise. They're more like river cruises.
Yeah, exactly. So you don't want children on that? You know, it's adults. No one running around. You spent a lot of money. You want calm, you want peace. So, yeah, they don't. Is it just adults or is it like old people? I have no idea. Can't say I've ever been on one, but I know that I'm guessing. I know that they're very expensive cruises and they're doing well.
I'm looking at Bank of America. Morgan Stanley shares here at the Open, both of them posting record equity trading revenue for the first quarter. And if not, if I'm not mistaken, every single bank posted record equity trading. It's all about market volatility, Also had a healthy consumer. They've also all been breaking out their private credit exposure. Bank of America has one of the smallest $20 billion in private credit. Just as a comparison, Jp morgan, they're bigger. This makes sense. Has $50 billion. Shares of Bank of America, UPS 3.7%, Morgan Stanley, three and a half percent. Not. All right. In tech news, Snapchat is cutting about 1000 jobs as it struggles to reach profitability because Snapchat is only for kids, 16% of the staff has to go. Meanwhile, Meta and Broadcom back to again the old people expanding their multibillion dollar partnership for custom A.I. chips that will help Meta reduce dependence on suppliers like Nvidia. And Andy should really have Allbirds in the in the tech board. Now that they're a tech infrastructure. Should I do we stereotype the people that wear allbirds what that they're all tech?
Rose I think you can stereotype them. Yeah.
No, I know. I was just wanting to group them. You know, we need to put everything in a box. Yes, I think that is probably still with us is Northstar Asset Management Chief Investment Officer Nimrod Kagan. Nimrod, The I mean, this story with Allbirds is pretty hilarious, but the story just has legs. I mean, we every day we have multibillion dollar deal headlines. By the way, today is Deals day. It's Wednesday, so Danny's show kicks off at noon. Do you continue to invest in this? Because a lot of these companies have really lost some steam. I mean, Microsoft is still down like a fifth year to date.
Yeah. I think the I story is to two different parts, right? So the market is pricing in the semiconductor stocks. That's where still the momentum is. That's where the price action has been and the market is pricing those on the near term cash flows. We have a pretty strong security that these companies are going to see revenue, profits, earnings, cash flows. Great. And that's what we're seeing on one side. The other side we are seeing is the, you know, taking out of the companies on the software as a service spectrum, the SAS of clips that we've been talking about. And that's prime you know, you have companies like Microsoft but also CRM into all of those companies lagging significantly because the market is saying we're not going to, you know, we're not going to price their short term cash flows, We're going to look out further 20 year horizon. And maybe these companies don't exist in the same way that they do today. So two different bifurcation going on at the same time. We think that, yes, the AI is here, it's real, but now it's time for the rest of the economy to start to seeing the diffusion and the benefits from the AI penetration company. After company we're seeing is implementing AI, you know, and that's where we see the real momentum coming to bear for the AI nimrods.
Also, when it comes to AI, our team reporting this morning that Anthropic had another fundraising round at valuing it at 800 billion openai's latest fundraising round, valuing it at even more than that. It could be an IPO of something that's like $1.2 trillion when these things list. Considering that they're listing at already punchy valuations, is that something you'd buy into?
Well, you know, one of the things is that private markets have become the valuations. Usually you used to have to wait to come to the public markets to really get that uplift in valuations. I think the story has been turned upside down. There's been so much demand, so much liquidity, money chasing in the private markets that those valuations have already reflected a lot of good. The other part of the whole story, Danny, is that let's not forget the Microsofts of the world, the Alphabet's all these companies own significant stakes in these private companies, right? So if you do it the other way around, the public market is not fully valuing the valuation that's being reflected on the private market. So my answer would be we wait for the public markets to give you the true valuation range for these companies.
What what do you see as an opportunity in terms of things that have lost value during the war, during the first half of the year? I mean, with the kind of rotation that we saw. You know, we've been talking about the fact that in the midst of this war rally, only 200 of S&P 500 companies have been up. The breadth, you know, is to the downside. So is there anything that you like? Are there any bargains out there?
Yeah, well, I think I'll start with the software stocks have become the value stocks. Right. And that's very attractive. And here's why not primarily. I'm sorry. Not private credit? No. Well, private credit. I think there's time to go. There's you know, we're going to let that play out for a little bit. But on the software side, you know, these have become real value stocks. And yes, there is a major reconfiguration that's required of business models, but the business processes are same, Matt. I mean, take a look at CRM. You know, every every business still needs to capture their customer information before back in the day. It used to happen in file cabinets. Then we came with those different types of softwares, like a CRM, to capture that information. Now we have so different tools in the toolbox, but the business process is exactly the same. And some of these companies are going to be able to introduce more tools to capture that. I mean, doing a plug here for Bloomberg and be ask, you know, I used to have to do these queries using BQ l BDP. Now I just do ask B Right. And that gives me all that information right there. So that's your way that some of these companies are going to adapt to this challenge posed by.
It is pretty incredible to see some of these changes. But just taking a step back on this overall economy, I was having a conversation with someone yesterday who works for one of the biggest real estate asset managers who said that there actually is this level where the k-shaped doesn't capture everything, this middle level, that it's not just air, but it's the lack of visas for highly skilled workers coming into the United States that's being challenged. You're also getting less visitors coming into the US because if they know they have to spend hours speaking to a Border Patrol agent before they're finally allowed in, maybe they're not going to travel as much in the US. We talked a lot about consumer stocks being challenged by lower income consumers, now adding energy on top of that. I just wonder if there's something else happening underneath the surface, if it's the really, really high part of the economy, those really high net worth individuals that are supporting us. But like everything else below it is challenge and what that means for your investment outlook.
Absolutely. Danny and I can vouch for that. I was at the national parks a couple of weeks back and, you know, just it's $100 fee for if you're not a US resident. So again, all these different pieces coming into play and maybe a family of four traveling from outside of the US is not going to be inclined to come and visit our national parks. But anyway, leaving that aside, I think there's a real thing. There is the high end that supporting, you know, the lower end that's struggling. We have seen a lot of data points around that. But what's happening also is that there's, you know, on the on the on the whole aggregate level, people are holding onto their jobs. It's a low hire, low fire environment and they're barely making it, but they're still holding onto their jobs and they are getting you know, Ed Yardeni talks a lot about this, how we have this huge inflow from baby boomers who are using their wealth and their resources to support the next generation who might be just barely making it with their expenses and income. So there there are all these places to be for investment. That does mean that we want to be diversified overall because you just don't know what's happening on a day to day basis, but also looking for those companies that are going to continue to offer value to the consumer. That's going to remain a paramount framework for us as we navigate this very difficult market.
All right. We're going to have to end things there. Thank you so much for joining us. And Nimrod Kagan, Northstar Asset Management, Chief investment Officer. Let's get a check on your equity market right now, because at the price we are currently trading at 6986, if we close at this level, it will be an all time high, the previous high being 6978. What is leading us, they're not huge gains, but again, it's enough. After ten days of a rally, that would be the best ten day rally since 2020. So we bounce back even better than we did in Liberation Day, Microsoft, Broadcom, those both leading the pack. Broadcom signing a deal with Meta to use their chips, Meta also in the top of the pile, Oracle. So a lot of the A.I. names having a very good day. On the downside, Amazon's a little bit weaker. Chips are not doing well today for whatever reason. Lam Research Micron. Those are in the bottom of the pile, as is Caterpillar. SanDisk again, another chip name. Looking at the individual sectors, you do have Infotech being one of the best performing, but financials doing well. We heard from Bank of America, Morgan Stanley rounding out the big bank earnings with a very strong trading revenue coming in, materials, utilities, consumer staples, those are at the bottom of the pile. But again, at 69, 87, well on our way right now to another all time high, 69, 87. Okay, that's 69. 87. That's the number 69. Our rate. Well, 78 was was the prior record anywhere at 69. 87 right now. You got it. We just need to get to around 7000. Coming up, banks are reporting a stellar quarter as market volatility leads to trading revenue records. Just massive records knocking the cover off the ball at Goldman Sachs, Jp morgan and others. Herman Chan of Bloomberg Intelligence breaks down the earnings for us next. This is open interest.
15 minutes into your trading day. Let's get some top calls while the analysts are upgrading and downgrade. First, we have an upgrade from Piper Sandler. This for Cloudflare, calling it an eye winner to own and pointing to the recent pullback as a rare entry opportunity. Shares up 3.4%. Next up, Jefferies cuts PPI said IG, saying that a data center deal for its nuclear plant looks unlikely as ratepayer rules could discourage hyperscalers. The firm sees weaker rate growth from New Jersey regulations and warns that new rules could add more pressure, though shares down 9/10. Finally, Wall Street is weighing on Bank of America's solid quarter. Evercore calls the results probably better, while noting that investors may be underweight and concerned about cost. Barrett is highlighting steady buybacks and execution. Matt.
All right. Market volatility has created a massive windfall for Wall Street banks with Bank of America, Morgan Stanley, Goldman Sachs and J.P. Morgan all reporting record trading revenue. Joining us now is Bloomberg Intelligence senior banks analyst Herman Chan. And it has been Herman, amazing to watch. The banks have made so much money. The energy companies have made so much money. This war has been very profitable for also the defense industry, I imagine. But what about the massive mess we saw at Goldman Sachs? I can't get over on FICC trading, right? It was $800 million less than analysts had anticipated. I think a 10% drop compared to the same quarter last year. Right. That not show up at other banks? It didn't show up.
It seemed like that issue was more specific to Goldman. So having Goldman to kick off the earnings season for the banks this time around, it sort of introduced some questions on FICC trading across the group. But I think resoundingly with the results from Morgan Stanley today, from the results of Jp morgan yesterday and Citi yesterday, that FICC trading was solid. Bank of America did that post about a flattish FICC trading. So I would point to them as on the big side as well. Most mostly, sure.
I mean, Morgan Stanley shares higher by four and a half percent. Why wasn't this priced in? I mean, there's a lot of volatility. We assume trading would be strong. Right. And it's not exactly a thing that they can I mean, they can repeat it as volatility is strong, but it's so markets dependent. Right. So what wasn't wasn't priced in to these banking shares coming into this earnings season, I would say there was a lot of optimism coming into the the quarter. I mean, the industry what and the analysts give me two words expecting about mid-teen earnings growth year over year. So really, you know, enthusiastic expectations coming in and the banks have met that and there's been some puts and takes right for the banks that I cover some issues on net interest margin from Wells Fargo and some reduce expectations on NII from Jp morgan. But then on the other hand, Bank of America really offered some solid guidance on net interest income for for the full year as well. What are they told us about private credit? I mean, we've heard, what, 36 billion in exposure from Wells Fargo and 20 from Bank of America, only two from Citi, smaller number. But what about the money that they make from lending private credit and private equity companies money to do these deals? I mean, what are the fees like for these big banks?
Yeah, the fees are great. You've seen it in the investment banking numbers that those were still fairly solid quarter over quarter and year over year as well. So there are some really strong results on the on the fee side of the investment banking, particularly on equities and fixed income. M&A has been might be a bit more choppier heading into the rest of the year, but the deal backlogs seem fairly stable. So we're enthusiastic despite all the volatility that we're seeing in the macro side of things, that things can be sustainable going forward.
That's not that some of the regional banks, PNC first horizon among them, I know it's it's a sector you also closely watch. Hermann what did we learn anything.
Yeah PNC is numbers were great. They talked about some higher loan growth for the rest of the year. That's been working out really well for them. They just closed the first bank deal that adds to their presence in Denver, which is expected to work well. MNC also reported today a bit mixed trends there in terms of some softer guidance for net interest income for 2026, really related to some deposit growth and some softer consumer lending.
All right, Herman, thank you very much for joining us. Herman Chan at Bloomberg Intelligence. A very busy week for him. And in the next hour, we're going to hear from Morgan Stanley's CEO, Ted Pick, right here on Open Interest at 1030. I believe it's actually at 1040. Yeah. I don't know why we keep saying that. I'm pretty sure. Yes. At 1030 we interview the CEO of We work, so it can't be 1030 point well in the 10 a.m. hour. Watch the whole thing because this interview will happen. Coming up, Stellantis gets a boost from the US with North American shipments jumping, is the turnaround taking hold? That's next. This is bloomberg open interest.
This is Bloomberg open interest on Matt Miller. A quick check on stocks right now. We do see the s&p 500 up only 1/10 of 1%, but 6974 the level here. Nasdaq up 2/10. If you take a look at oil, it continues to well, it's only down 5/100 on Brent, but 9472 is the level there. WTI also bouncing back and forth. We'll find it. We'll show you. And video right now. Up 1% almost. That's helpful. Broadcom gaining 3.7% on its deal with Facebook. Snap doing well. Also, Allbirds. This is an astounding story. Well, it was. I know it still is behind you. If you look me up. I'm happy about this, though. Okay. Who knows what's going on? Ted Pick is joining us at 1040. The CEO of Morgan Stanley is coming on this network at 1040. So mark your calendars. We don't want to waste your time. Yes, 1040 okay, So you have Stellantis there. Matt, Should we talk about Stellantis?
Yes. Stellantis shipments are rebounding up 12% globally in the first quarter, led by a 17% jump in North American sales. Joining us now is Bloomberg autos reporter Gabby Coppola. And Gabby, I want to say this is because of the Hemi, right? It's because they brought the vapes back that they're selling more vehicles.
Matt, I'm so happy to tell you that. I think you're right. I think that is part of what's driving this. That was a kind of a strategic blunder that they ever took it away in terms of, you know, pleasing the customer. And the fact that RAM has basically they they had some manufacturing problems, some some issues. They got those worked out. So they're coming off a low base. But yes, and they've brought back the Hemi, put it in the RAM 1500, and that is what consumers wanted. And if you just look at the RAM light duty pickup truck deliveries in the U.S. in the first quarter, they were up 27%. So that helped a lot. Also, they have the new Jeep Cherokee hybrid that just started delivery. So they finally getting that new product out the door and that's helping them, you know, recover shipments a bit.
Is it enough? I mean, they only just earlier this year, Gabby took a $26 billion write down and charges. I mean, that that's pretty massive to deal with.
Yes, it is. And, you know, they certainly weren't alone with that. A lot of automakers, a lot of that was, you know, they ordered all these tooling and equipment and parts to make electric vehicles and then they scrapped the plan so they had to pay the suppliers for that. So is it enough to be profitable? I think CEO Antonio Phil also has said that North America business will be profitable this year. That's what they're hoping for the rest of the entire company, TBD. And I think they're looking for solutions for other regions. But they really, you know, put all their most of their eggs in the basket of a rebound in North America and particularly the U.S.. You know, they were one of the first companies. Jeep was one of the first companies to pull its factories out of China. As you know, things got a little bit heated. And now I read that they're thinking about going back to a partnership with Dongfeng to make vehicles there, to make vehicles for China, to make vehicles for Europe.
What's the story with that?
It's very interesting. So you're right back under the previous CEO, Carlos Tavares. I think to his credit, he sense that there was going to be sort of just a China the China car market was going to be a bloodbath in terms of profits. And so he got he got out of there and they broke up with Dongfeng. But now, you know, they want to get back. And the bigger issue is that Stellantis has a lot of excess capacity in Europe. And even though they had some rebounds, you know, in shipments like with the new hybrid Fiat 500 made in Italy and things like that, Maserati, Alfa, they need new markets and they need someone that, you know, help absorb some of that capacity. So the talks that my colleagues in Europe reported today is that they are talking about getting back together with their Chinese partner, Dongfeng, where they would Dongfeng could possibly maybe use some of the production or build in, you know, use up some of the capacity in the European plants. And in return, they could make some of the Stellantis's models in China and help them access the Chinese market again.
All right, hot story. Gaby, really appreciate you joining us. Gaby Coppola out there talking to us about Stellantis. I will say if you listen to my podcast, Hot Pursuit with Hannah Elliott, you'll know that I love the V8. It's like every other American I like. I own a 392 Hemi in my challenger, but I will say the hurricane inline six. The high output motor with 510 horsepower is still a fantastic motor even for the truck. I drove it in the RAM 1500. So yeah. All right. Coming up in the next hour, Goldman Sachs Katherine Borel May joins us. Plus, Bank of England policymaker Megan Green and an exclusive interview with Morgan Stanley CEO Ted Pick at 1040. This is open interest.
We are 30 minutes into the trading day. Welcome to bloomberg open interest. I'm matt Miller.
And I'm Danny Berger. Markets hanging on to all time highs. If we close at these levels and the game show no signs of letting up after ten straight days of rallying now in 11th Friday's the Nasdaq. Coming up, stocks near record highs on rising hopes for peace. Don't we already have it? The US and Iran agree in principle to extend their cease fire. Earnings in full swing. Morgan Stanley, Bank of America. Those traders join Wall Street's record windfall. And PIMCO bought all $400 million of bonds sold by Blue Owl, a big vote of confidence in a battered private credit market. Now, US and Iran have agreed in principle to extend the ceasefire, buying more time for diplomacy. This according to the AP. President Trump speaking on Fox Business about a potential deal in the Middle East.
