Europe slips into technical recession in first quarter, as lockdowns took toll [MarketWatch]
Gross domestic product fell 0.6% in the eurozone compared with the previous period, and by 0.4% in the wider European Union…. The International Monetary Fund sees the eurozone growing 4.5% this year — still lagging far behind the U.S. and China.
Barclays beats expectations in the first quarter as loan impairment charges slide [CNBC]
Barclays on Friday reported first-quarter net profit of £1.7 billion ($2.37 billion)…. Analysts had expected first-quarter net income to come in at £1.3 billion, according to Refinitiv…. “This is largely thanks to their robust business model and strong CIB (Corporate and Investment Banking) performance. However, their consumer business still faces the headwinds of the Covid-19 pandemic which will likely continue throughout 2021,” [Publicis Sapient senior vice president Sudeepto Mukherjee] said in a note.
Melvin Capital Reveals Eight More Negative Bets That May Have Fueled January Rout [II]
On Wednesday, Melvin filed an amended version of the document disclosing that as of December 31 it held put positions in an additional eight companies not previously known.
Six of those eight companies’ common stocks surged in price in January. From January 2 to January 28, one of the eight stocks Melvin had betted against nearly doubled in price. Two surged around 50 percent through January 27, while three others rose at least 20 percent over the same period.
Energy-Focused Hedge Fund Luminus Liquidates Some Assets [WSJ]
New York-based Luminus began to unwind holdings in its Energy Partners fund about a year ago, when the Covid-19 pandemic triggered market turmoil and prompted investors to withdraw their money, according to people familiar with the matter. The total value that the firm manages has fallen to $1.15 billion, from about $2.1 billion in March 2020…. Luminus, which invests on behalf of institutions including sovereign-wealth and pension funds, is shrinking rather than shutting down. Money has flowed instead into several newer funds that invest in markets tied to decarbonization, underscoring the growing popularity of assets with green credentials….
Buffett Fights With Investors, With His Reputation at Risk [DealBook]
Shareholders, including the Calpers public pension fund, argue that Buffett’s conglomerate isn’t doing enough to disclose its portfolio companies’ progress in addressing those issues. Buffett opposed these initiatives ahead of the meeting, arguing that they cut against Berkshire’s philosophy of letting its subsidiaries operate largely independently…. The big question is whether this will tarnish Berkshire’s golden reputation. Corporate America is increasingly heeding investor demands — including from BlackRock, a major Berkshire shareholder — to do more to fight climate change and racial inequity. Berkshire does not dispute the importance of climate change and diversity, but Buffett’s pushback here risks denting his standing as perhaps the world’s most admired investor. “I don’t think at the moment there’s been a slip in the gold standard,” said Lawrence Cunningham, a professor at George Washington University and a Berkshire shareholder, “but if it’s not tended to, there might be.”
Leon Cooperman sees stock market lower a year from now due to tax, rate, inflation pressures [CNBC]
“Let’s face it. The market is facing the fact that taxes are going up, interest rates are going up, and inflation is going up. And we have a reasonably richly appraised market. So cyclically I’m engaged. But I got an eye on the exit,” Cooperman said in an interview on “Squawk Box.”
“I suspect the market will be lower a year from today. But I don’t have to make that guess now. This is not going to end well,” the chairman of the Omega Family Office added. “But nobody, myself included knows when this is going to end. We just watch the things that would normally indicate an end….”
“The whole slowdown in the SPAC area is self-correcting,” Cooperman added, saying he doesn’t see the conditions currently that would lead to a significant market decline in the near term.