Andy Bisek (blue) of the U.S. faces off with Kim Hyeon-Woo of South Korea as they wrestle in the Greco-Roman 75 kg/165 lbs "Beat the Streets" event in Times Square, New York.
Yahoo bids might come in a lot lower than expected. Bids for Yahoo's core business are now expected to be a lot lower than initially thought, The Wall Street Journal's Douglas Macmillan and Ryan Knutson report, citing people familiar with the matter. Bids are now expected in the $2 billion to $3 billion range, well below the $4 billion to $8 billion that was previously estimated. Verizon, Quicken Loans founder Dan Gilbert (backed by Warren Buffett), private equity firm TPG, and a group that includes Bain Capital and former Yahoo CEO Ross Levinsohn are said to be among the interested parties. The deadline for his round of bidding is sometime during the first week of June.
Tesla raised fresh capital. The electric car maker raised $1.46 billion through the sale of 6.8 million new shares of common stock, Reuters reports, citing IFR. The capital raise comes as Tesla looks to ramp up production of its mass-market vehicle the Model 3, which saw far greater demand than was anticipated. IFR says Morgan Stanley, Goldman Sachs, Deutsche Bank, Citigroup and Bank of America Merrill Lynch were all involved in the offering.
Gap is closing a bunch of stores and layoffs could be coming. The company earned an adjusted $0.32 on revenue of $3.44 billion, matching forecasts. Same store sales sank 5%, but that was better than the 7% slide that was anticipated. Gap announced it will close up to 75 stores, mostly outside the US, and that layoffs could be coming soon. Shares were up as much as 3% in after-hours action.
Ross Stores missed tough comparables. The discount retailer announced earnings of $0.73 per share, matching estimates. Revenue rose 5.1% to $3.09 billion, just missing the $3.12 billion Bloomberg consensus. Additionally, comparable store sales grew 2% versus projections of 2.4%. "Even though we faced our strongest prior year comparisons, sales performed at the high end of guidance, while earnings per share were slightly above our targeted range," CEO Barbara Rentler in the earnings release. Shares of Ross Stores were down as much as 10% in after-hours trade.
Saudi Arabia is about to launch an international bond. Saudi Arabia is about to tap the sovereign debt market for the first time as it reels from the oil crash, according to a report from the Financial Times. The need for cash comes as Saudi Arabia has seen a 23% drop in oil revenue, which is creating huge problems as the energy component accounts for 77% of Saudi Arabia's revenue. The size of the offering has not yet been disclosed.
It's possible we see a repeat of the 1994 bond market massacre. Deutsche Bank's chief international economist, Torsten Sløk thinks the longer the market ignores the Fed, the higher the chances "we could see a move in bond markets similar to what we saw in 1994." Sløk points to the fact the US economy is reaching full employment, and that there's a "broad-based uptrend in wages and inflation" as evidence the market might be underestimating the Fed. During the first nine months of 1994 the 30-year yield spiked around 200 basis points as the Fed hiked much more aggressively than the market was anticipating.
Markets don't think there's going to be a Brexit. A new report from Deutsche Bank strategist Jack Di-Lizia suggests the Remain vote is gaining a sizable lead. With five weeks to go until the vote, the market has "shown signs of increasingly pricing out the likelihood of a Brexit across a range of financial market variables," Di-Lizia says. Those signs include a strengthening of the British pound, and a "more hawkish" pricing at the front-end of the yield curve. The referendum is set to take place on June 23.
Stock markets everywhere are bid. Britain's FTSE (+1.3%) leads the gains in Europe after Hong Kong's Hang Seng (+0.8%) paced the advance in Asia.
Earnings reports trickle out. Campbell Soup, Deere, and Foot Locker are among the names reporting ahead of the opening bell.
US economic data is light. Data concludes for the week with the 10 a.m. ET release of existing home sales. The US 10-year yield is up one basis point at 1.86%.