Merger Monday is back with a bang.<\/p>\n
Despite economic uncertainty, high interest rates, recent bank turmoil and the risk of a recession, there\u2019s been a hive of M&A activity to start the week.<\/p>\n
Gold prices are hovering near all-time highs given the recent flight to safety of investors amid banking turmoil and broader economic concerns. Newmont wants to capitalize, scooping up Newcrest\u2019s low-cost, long-life gold assets.<\/p>\n
But there\u2019s another carrot. Newmont wants its rival\u2019s copper assets, a metal proving important to the world\u2019s energy transition\u2013used in everything from electric-vehicles to solar panels and wind turbines.<\/p>\n
Another commodity\u2013this time oil\u2013was at the center of a separate major deal as pipeline operator
\n Oneok
\n said it\u2019s buying its rival
\n Magellan Midstream Partners
\n for $18.8 billion. It marks a move into oil for the predominantly natural gas-focused Oneok and would create a pipeline giant.<\/p>\n
But it\u2019s not just commodities driving the dealmaking.
\n NeoGames
\n agreed to be bought by Australian gaming technology developer
\n Aristocrat Leisure
\n for $1.2 billion.<\/p>\n
M&A activity and the value of deals typically decline in an economic downturn. While Monday\u2019s dealmaking might point to optimism, that\u2019s not always the case. Sometimes companies do one last cut-price big deal to consolidate because they think the economy is going to fall.<\/p>\n
However, the values paid by Newmont and Oneok are hefty premiums which are a positive sign.<\/p>\n
\u2014Callum Keown<\/em><\/p>\n *** Join Barron\u2019s senior managing editor Lauren R. Rublin and deputy editor Ben Levisohn today at noon when they discuss the outlook for financial markets, industry sectors, and individual stocks. Sign up here.<\/em><\/p>\n Try your hand at this morning\u2019s Barron\u2019s digital jigsaw, which is based on the week\u2019s cover story. For all games, including the daily crossword and sudoku, click here.<\/em><\/p>\n Lawmakers head into this week facing another crunchtime on an agreement about the nation\u2019s debt ceiling. Democrats appearing on the Sunday talk show circuit threw cold water on some ideas at President Joe Biden\u2019s disposal, including invoking the 14th Amendment to continue raising debt.<\/p>\n What\u2019s Next:<\/strong> Biden is expected to leave Wednesday for the G-7 world leader meeting in Japan despite earlier last week saying he would consider postponing the trip amid the debt ceiling standoff, White House press secretary Karine Jean-Pierre told reporters.<\/p>\n \u2014Liz Moyer<\/em><\/p>\n After one of the biggest challenges to President Recep Tayyip Erdogan in his two decades at the center of power in Turkey, the country appears set for a runoff election. A first round of polling failed to yield an obvious winner, and both Erdogan and opposition leader Kemal Kilicdaroglu have said they are prepared to accept a runoff.<\/p>\n What\u2019s Next:<\/strong> A confirmed runoff election would plunge Turkey into two weeks of renewed campaigning frenzy as Erdogan and Kilicdaroglu vie for a majority. Investors should brace for more volatility in the lira, a commonly traded global currency that has already declined almost 5% against the dollar in 2023.<\/p>\n \u2014Jack Denton<\/em><\/p>\n Electric vehicle start-ups have been forecasting disappointing manufacturing targets for 2023, citing problems that have nothing to do with demand. What\u2019s Next:<\/strong> Tesla\u2019s shareholder meeting is Tuesday. Investors will vote on a shareholder proposal that seeks to identify \u201ckey persons\u201d and \u201csuccession processes.\u201d Tesla is telling shareholders to vote no, saying it could cause unnecessary competitive harm.<\/p>\n \u2014Al Root, Jack Denton, and Liz Moyer<\/em><\/em><\/p>\n Consumer prices, for everything from luxury handbags to streaming media subscriptions and fast food, continue to rise as companies demonstrate their brand power, helping them cover the rising costs of labor and raw materials. A wave of retailer earnings this week could show how broad-based the trend is.<\/p>\n What\u2019s Next:<\/strong> The Census Bureau reports retail sales data for April on Tuesday. Consumer spending is expected to increase 0.7% month over month, while sales excluding autos are seen rising 0.4%. March had monthly declines of 0.6% and 0.4%, respectively.<\/p>\n \u2014Liz Moyer and Barron\u2019s staff<\/em><\/p>\n The Hollywood writer\u2019s strike is forcing changes to the television industry\u2019s annual advertising sales blitz. What\u2019s Next:<\/strong> Insider Intelligence expects upfront ad spending will fall by 3.4% to $18.6 billion for the 2023-2024 season, the Journal reported. The research firm cited uncertainty in the economy, falling TV ratings and cord-cutting as part of the reason for the decline. <\/p>\n \u2014Liz Moyer<\/em><\/p>\n***<\/h4>\n
Debt Ceiling Takes Center Stage as Biden Prepares for G-7<\/h2>\n
\n
***<\/h4>\n
Turkey\u2019s Erdogan Fails to Clinch Victory. Runoff Election Likely.<\/h2>\n
\n
***<\/h4>\n
EV Start-Ups Forecasting Disappointing Targets Despite Demand<\/h2>\n
\n Polestar
\n has blamed software, while
\n Fisker
\n said it took longer than expected to get final certifications required to sell any car.
\n Rivian
\n has had trouble accelerating production and securing semiconductors.<\/p>\n\n
\n Tesla
\n and other makers. Battery-electric vehicle sales also rose year over year in China and Europe. <\/p>\n<\/li>\n
\n Ford
\n is still producing 10% fewer vehicles than it would like, but shortages have shifted to general parts from chips, CEO Jim Farley toldBarron\u2019s<\/em>. Ford is doubling production<\/strong> of electric vehicles and Farley says that demand has exceeded his expectations.<\/p>\n<\/li>\n***<\/h4>\n
Retailer Earnings This Week: Walmart, Target, Home Depot<\/h2>\n
\n
\n is expected to report first quarter earnings per share of $1.31 and revenue of $148.7 billion, both falling<\/strong> from the January quarter. Same store sales are expected to rise 5.4% but also be lower than the January pace.<\/p>\n<\/li>\n
\n is expected to report earnings of $1.77 a share and revenue of $25.3 billion, also both lower than the January quarter. Same store sales are seen rising 0.2%<\/strong> compared with the 3.3% gain in the first quarter 2022, according to FactSet.<\/p>\n<\/li>\n
\n Home Depot
\n and
\n Lowe\u2019s,<\/span>
\n two home improvement retailers set to report this week. A delayed start to spring weather and a deceleration in spending<\/strong> on home goods are weighing on the stocks. <\/p>\n<\/li>\n<\/ul>\n***<\/h4>\n
Media\u2019s Annual Sales Blitz Hits Snags With Writer Strike<\/h2>\n
\n Netflix
\n has moved what was a planned in person presentation at its Paris Theater in New York to a virtual presentation out of concern for picketing writers, The Wall Street Journal reported.<\/p>\n\n
\n Comcast\u2019s<\/span>
\n NBCUniversal,
\n Warner Bros. Discovery,<\/span>
\n the parent of streaming platform HBO Max, CNN and other channels, and
\n Walt Disney,<\/span>
\n parent of streaming platform Disney+ and ABC television. <\/p>\n<\/li>\n***<\/h4>\n