Newsquawk Daily US Equity Opening News: Buffett to step down as Berkshire CEO by year-end; Trump orders 100% tariffs on foreign-made movies

TODAY'S AGENDA:

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  DAY AHEAD: The US Day sees the release of the final S&P Global composite and services PMI data for April, ahead of the release of the widely followed ISM Services report, where the headline is seen paring to 50.2 from 50.8. US Employment trends data for April are also due. In supply, the US Treasury will auction USD 58bln of 3yr notes. Notable corporate results due today include VRTX, O, F, PLTR, WMB.


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  WEEK AHEAD: Notable highlights include: policy announcement from the FOMC, BoE; US and China Services PMI data; Canada jobs report; China trade stats. Notable corporate reports due this week include: PLTR, AMD, UBER, DIS, ARM


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  Click here for our week ahead briefing.


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  Click here for our Weekly US Earnings Estimates.


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  BROKER MOVES: RDDT upgraded at Bernstein, while BDX and XYZ see downgrades post-earnings. To see the full list, please click here.


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  MAJOR MORNING MOVES RECAP: BRK-B, NFLX, SHEL/BP, HSIC, ZBH, TSN. To see the full list, click here.


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  DAILY US CONFERENCE CALENDAR: To see the full calendar, click here.

MACRO

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  US-China - President Trump expressed willingness to reduce tariffs on China, acknowledging that the current levies are so high they have essentially halted trade between the two largest global economies. He indicated that tariff reductions could occur at some point in the future. Separately, Beijing is considering offering fentanyl control to the US as a trade negotiation gesture, sources told the WSJ. President Trump said he does not plan to speak with China President Xi this week, but acknowledged ongoing discussions between China and the US; when asked about potential trade deals, he expressed a desire for a fair trade deal with China.


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  Movie Production - President Trump announced that the US would impose a 100% tariff on all foreign-made films, citing the decline of the American movie industry due to foreign incentives drawing filmmakers away. He described this as a national security threat and urged for a return to American-made movies. Of note for Netflix (NFLX).


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  Federal Reserve - President Trump said he does not plan to fire Fed Chair Powell, despite ongoing criticism of Powell's handling of interest rates. Trump emphasised he would have the opportunity to replace Powell in the near future, further indicating his dissatisfaction with the pace of rate cuts.

FINANCIALS

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  Berkshire Hathaway (BRK.B) - Warren Buffett will step down as Berkshire Hathaway CEO at year-end and recommend Greg Abel as successor, telling shareholders he will retain all his shares as he believes the Cos. prospects are stronger under Abel’s leadership. Berkshire Hathaway shareholders voted unanimously to name Greg Abel President and CEO, effective January 1st, 2026. CNBC reports that Buffett will remain Chairman. Meanwhile, the firm reported Q1 numbers (USD): Operating earnings 9.64bln (vs 11.22bln Y/Y), Revenue 89.73bln (vs 89.87bln Y/Y), Net profit fell 63% Y/Y to USD 4.67bln, EPS 2.13 (exp. 4.72). Cash holdings rose to USD 347.68bln. Insurance investment income rose +11% despite wildfire losses; Geico pre-tax profit rose 13%. Berkshire warned it cannot reliably predict the impact of 2025’s shifting tariffs and trade policies, citing potential adverse effects on most operating businesses and equity investments due to rising costs and uncertain demand.


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  Big Banks - Fed supervision chief nominee Michelle Bowman plans to review confidential ratings after criticising the Fed for labelling two-thirds of major banks unsatisfactory in 2024, despite their financial strength, WSJ reports; she is expected to favour lighter regulation if confirmed as Vice Chair for Supervision. Separately, the Fed's director of supervision and regulation division Michael Gibson will retire at the end of 2025 after more than 30 years with the central bank; Gibson, who joined in 1992, advanced within the Fed, particularly after the 2008 financial crisis.

COMMUNICATIONS

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  ByteDance - US President Trump said he would extend the June 19th deadline for ByteDance to divest TikTok’s US assets if no deal is reached by then. A potential deal has been delayed due to US-China tariffs. Trump indicated tariffs could be reduced in a broader agreement, despite opposition from some Democratic senators.


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  Alphabet (GOOG) - Google can use web content to train its search-focused AI tools, such as AI Overviews, even if publishers have opted out of AI training, as the opt-out only applies to DeepMind, not other Google divisions, a company executive testified in court, Bloomberg reports. Separately, US antitrust regulators are using Google's 2010 agreement with Yahoo Japan, which allowed access to its search index data, as a precedent to argue that Google should again share information; the DoJ claims this is necessary to end Google's alleged illegal monopoly on online search, although the 2010 deal only applied to its Japanese-language index.


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  Disney (DIS) - Disney's Thunderbolts debuted as the top film in the US and Canada, grossing USD 76mln, aligning with its forecast but below the USD 90mln industry estimate. The film's performance was similar to Captain America: Brave New World, but with better critical reviews, which may boost its long-term box office prospects, the report adds.


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  Netflix (NFLX) - Cos. production investments in India generated a USD 2bln economic impact from 2021-2024, highlighting the country’s growing significance for the streaming platform, BBG reports.

TECH

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  Qualcomm (QCOM), Samsung Electronics (SSNLF) - Samsung has opted to use Qualcomm's Snapdragon chips for the entire Galaxy S25 lineup, abandoning its in-house Exynos 2500 due to delays, DigiTimes reports. It secures Qualcomm a full design win, although Samsung plans to potentially revive its Exynos line in future models.


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  Foxconn (HNHPF) - Reported April revenue growth of +25.54% Y/Y (vs +23.4% Y/Y in March). It said the based on current visibility, the outlook for Q2 sees both Q/Q and Y/Y growth, but the impact of political and economic conditions will need monitoring. It said that its Cloud and Networking segment is seen maintaining growth momentum in Q2, though that period is traditional an off-season, and primary product lines are entering a product transition period.


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  Samsung Electronics (SSNLF) - Renegotiated its tax incentives with Taylor, Texas, due to delays in the launch of its USD 18bln chip foundry, now pushed back by nearly two years, DigiTimes reports. The revised deal significantly reduces the financial benefits originally agreed upon.


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  China Semiconductors - China's 28nm chip production capacity is set to reach 31% by 2027, driven by expansions at SMIC's various fabs, Hua Hong Semiconductor's phase-two fab in Wuxi, and Nexchip, despite ongoing challenges like US curbs and domestic oversupply, DigiTimes reports.


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  ON Semiconductor (ON) Q1 2025 (USD): Adj. EPS 0.55 (exp. 0.5), Revenue 1.45bln (exp. 1.40bln). Q2 Guidance: Adj. EPS 0.48-0.58 (exp. 0.51), Revenue 1.4-1.5bln (exp. 1.42bln).


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  Strategy (MSTR) - Purchases 1,895 Bitcoins between April 28th and May 4th at an average of USD 95,167 for a total of USD 180.30mln.

CONSUMER DISCRETIONARY

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  US Listed Chinese Stocks - US lawmakers have urged the SEC to delist Chinese firms like Alibaba (BABA), JD.com (JD) and Baidu (BIDU) over alleged military links, citing "unacceptable risk" to investors, according to the FT.


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  Alibaba (BABA) - Ant Group plans to list its overseas arm, Ant International, on the Hong Kong stock exchange. Co. is in talks with regulators, though it's unclear whether this involves Chinese or other regulators. Ant is working towards obtaining a financial holding company licence, which could facilitate a potential IPO revival.


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  Nike (NKE), Adidas (ADDYY), Skechers (SKX) - Nike, Adidas, Skechers and others urged President Trump to exempt footwear from new tariffs, warning they threaten the industry’s viability, risk inventory shortages, and will not bring manufacturing back to the US, CNBC reports.


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  General Motors (GM) - GM confirmed that Cadillac’s Formula One debut in 2026 will not be affected by a potential USD 5bln tariff impact. Despite cutting its 2025 profit forecast, GM remains committed to the project, building a 350-strong team for the debut, with future plans for 1,000 staff.


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  Churchill Downs (CHDN) - Reported record-breaking wagering on Kentucky Derby Day, with total wagers reaching USD 349.0mln, surpassing last year's USD 320.5mln. The Derby race alone saw USD 234.4mln in wagers, up from USD 210.7mln. Derby Week's total handle hit USD 473.9mln, and TwinSpires handled a record USD 108.0mln.


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  Tesla (TSLA) - Spain new Tesla registrations -16.6% Y/Y in Jan-April, while electric cars as a whole +54%, according to ANFAC.

ENERGY

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  OPEC - OPEC+ has agreed to increase oil production by 411k BPD in June, part of a series of hikes totalling nearly 1mlnBPD for April, May, and June; the decision, driven by Saudi Arabia's dissatisfaction with member compliance, and is expected to pressure oil prices further amid economic slowdown concerns. According to sources cited by Reuters, OPEC+ plans to accelerate oil output increases, potentially adding 2.2mln BPD by November; Saudi Arabia is leading the move to punish non-compliant members like Iraq and Kazakhstan, aiming to expand market share. The shift follows a larger-than-expected hike in April and may impact prices amid concerns over global demand. Goldman Sachs lowered its oil-price forecasts due to higher OPEC+ supply, with expectations of an additional 411k BPD in June; the bank now predicts Brent crude will average USD 60/bbl in 2025 and USD 56/bbl in 2026, while WTI is forecasted at USD 56/bbl in 2025 and USD 52/bbl in 2026.


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  BP (BP), Shell (SHEL) - Shell is evaluating a potential acquisition of BP, and is working with advisers to assess the deal’s feasibility, Bloomberg reports. However, Shell is waiting for further declines in stock and oil prices before deciding whether to proceed with a bid, according to sources.


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  Matterhorn Express Pipeline, Enbridge (ENB) - A consortium led by I Squared Capital is negotiating to acquire the Matterhorn Express Pipeline, a Texas natural gas conduit, in a deal valued at approximately USD 5bln, including debt. The consortium, which includes Enbridge, is in discussions to purchase a majority stake.


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  LNG - China has resumed spot LNG purchases after a period of inactivity, taking advantage of a price drop to USD 10/BTU, the lowest in about a year. At least two shipments were procured last week, with more possible if prices remain at these levels, Bloomberg said.


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  Sunoco (SUN) - To acquire Parkland Corporation (PKI CT) in transaction valued at USD 9.1bln, expected USD 250mln in run-rate synergies by year 3; Parkland shareholders will receive 0.295 SUN units and CAD 19.80 for each Parkland share.

MATERIALS

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  BHP Group (BHP) - BHP's JV partner Lundin Mining announced that the Filo del Sol copper project in South America is the largest copper discovery in 30 years, containing at least 13mln tons of copper, along with significant gold and silver. Drilling continues, and the deposit's size is expected to grow.


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  Gold Fields (GFI), Gold Road Resources (GOR) - Gold Fields has agreed to acquire Gold Road Resources for AUD 3.7bln, increasing its offer by 12% after previous negotiations. The deal will be funded in cash, with Gold Fields purchasing all outstanding shares at AUD 3.40 each, Bloomberg reports.

INDUSTRIALS

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  RTX (RTX) - US has approved a USD 3.5bln weapons sale to Saudi Arabia, which includes 1,000 AIM-120C-8 air-to-air missiles and 50 guidance sections, along with logistical support. The deal comes ahead of President Trump’s visit to Saudi Arabia this month, aimed at strengthening ties and intensifying pressure on Iran.


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  Lockheed Martin (LMT), General Dynamics (GD) - The State Department approved up to USD 350mln for F-16 fighter-jet training and support services for Ukraine. The move signals continued US support for Ukraine's defence against Russia, despite President Trump's calls to end the war.


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  United Continental Holdings (UAL) - Cancelling 35 daily round-trip flights from Newark after 20% of FAA air-traffic controllers walked out amid longstanding issues and recent tech failures, WSJ reports.


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  American Airlines (AAL) - Sued the city of Chicago, alleging it is favouring United Airlines (UAL) in gate allocations at O’Hare, threatening its position at the only dual-hub airport in the US.


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  Cummins (CMI) Q1 2025 (USD): EPS 5.96 (exp. 4.92), Revenue 8.17bln (exp. 8.24bln); due to growing economic uncertainty driven by tariffs have withdrawn FY guidance.

HEALTHCARE

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  Novo Nordisk (NVO) - US FDA accepts application for Novo-Nordisk's oral Semaglutide 25mg, which if approved, would be the first oral GLP-1 treatment for obesity.


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  Henry Schein (HSIC) Q1 2025 (USD): Adj. EPS 1.15 (exp. 1.11), Revenue 3.17bln (exp. 3.23bln). Guidance: Backs FY25; adj. EPS 4.80-4.94 (exp. 4.84), Revenue growth about 2-4% Y/Y.


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  Zimmer Biomet Holdings (ZBH) Q1 2025 (USD): Adj. EPS 1.81 (exp. 1.76), Revenue 1.91bln (exp. 1.89bln). Guidance: Cuts FY25 adj. EPS to 7.90-8.10 (prev. 8.15-8.35, exp. 8.21); Raises FY25 revenue view to +5.7-8.2% (prev. +1-3.5%).


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  Teva Pharmaceuticals (TEVA) and Alvotech announced that the US FDA has approved SELARSDI injection as interchangeable with the reference biologic Stelara.


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  Johnson's & Johnson (JNJ) Tremfya (guselkumab) positioned to become the first and only il-23 inhibitor to offer subcutaneous induction in ulcerative colitis as demonstrated in new data through 24 weeks.

CONSUMER STAPLES

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  Tyson Foods (TSN) Q2 2025 (USD): Adj. EPS 0.92 (exp. 0.83), Revenue 13.07bln (exp. 13.09bln); FY25 adj. op. income view 1.9-2.3bln (exp. 2.14bln); anticipate improved results from foreign ops. in FY25 on adj. basis.

REAL ESTATE

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  Howard Hughes Holdings (HHH) - Pershing Square to invest USD 900mln to acquire 9mln newly issued shares of Howard Hughes Holdings and transform Co. into a diversified holding company.

05 May 2025 - 13:37- Fixed IncomeData- Source: Newsquawk