S&P 500 Rally Fades on Tariff Angst as Bonds Climb
Bloomberg Television brings you the latest news and analysis leading up to the final minutes and seconds before and after the closing bell on Wall Street. Today's guests are Gargi Chaudhuri, BlackRock, Kailey Leinz, Bloomberg News, Natasha Kaneva, JPMorgan, Kate McShane, Goldman Sachs, Kent Britton, Port Corpus Christi, Mandeep Singh, Bloomberg Intelligence, Kathy Entwistle, Morgan Stanley, Matt Kramer, KPMG, Deborah Weinswig, Coresight Research, William Quigley, Tether, Bill Pulte, Fannie Mae and Freddie Mac, Seth Rubin, Stifel. (Source: Bloomberg)
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Yahoo
22 minutes ago
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Goldman Sachs upgrades Brazil's XP, cuts rating on B3 on shifting risk-reward
-- Goldman Sachs upgraded Brazilian brokerage XP (NASDAQ:XP) Inc to 'Buy' from 'Neutral' saying the company has a stronger operating leverage, its revenue mix, and potential upside incase interest rates fall faster than expected. The bank raised its price target for XP to $23 and said the firm's reduced reliance on equity market performance, along with steady fixed income revenue growth, puts it in a favorable position for consistent low double-digit revenue growth. 'XP has become less dependent on a further market recovery,' Goldman wrote, pointing to a shift in its revenue composition. Fixed income revenues overtook equities as XP's largest source in the first quarter, with equity revenues down to 21% from over 40% in 2021. In a bull case scenario, revenue could grow 21% in 2026 versus a base case of 11%, the bank said. Goldman also highlighted XP's strong capital position, which should support further buybacks and dividends. It projects 16% earnings growth in 2026 under its base the brokerage downgraded exchange operator B3 SA to 'Neutral' from 'Buy', saying limited room for further margin expansion and potential overhang from competition and lawsuits cap upside. B3's EBITDA margin already ranks among the highest globally at 70%, and its shares are trading at a steep premium to Brazil's Ibovespa index. Further upside from here could be more dependent on a sustained equity market recovery, according to Goldman analysts. Goldman maintained its 'Buy' rating on BTG Pactual, calling it the most resilient earnings story in the group. The brokerage sees the overall environment improving for capital markets, but believes XP offers better risk-reward relative to peers. Related articles Goldman Sachs upgrades Brazil's XP, cuts rating on B3 on shifting risk-reward Bernstein starts coverage of entertainment stocks: Spotify and TKO at Outperform Buy the dip in Kenvue stock: Jefferies Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30 minutes ago
- Yahoo
Apple downgraded, Snowflake upgraded: Wall Street's top analyst calls
The most talked about and market moving research calls around Wall Street are now in one place. Here are today's research calls that investors need to know, as compiled by The 5 Upgrades: UBS upgraded Snowflake (SNOW) to Buy from Neutral with a price target of $265, up from $210. The firm is becoming increasingly confident in the prospect that Snowflake is "just a few quarters into what could prove to be a multi-year enterprise investment cycle in the data layer." Oppenheimer upgraded Dollar General (DG) to Outperform from Perform with a $130 price target. Following the company's stronger than expected earnings report, the firm is increasingly confident in management's ability to drive a 2%-3% comp on a sustained basis and make progress toward its 6%-7% operating margin target in 2028 and 2029. Goldman Sachs upgraded Yum! Brands (YUM) to Buy from Neutral with an unchanged price target of $167. The firm cites the company's "best-in-class unit growth trajectory" versus most peers and its high franchise mix for the upgrade. Goldman Sachs upgraded XP Inc. (XP) to Buy from Neutral with a price target of $23, up from $17. The firm sees the company well positioned to benefit from operating leverage, with possible upside risks if revenue growth accelerates further. Citi upgraded Blueprint Medicines (BPMC) to Neutral from Sell with a price target of $129, up from $83, following the announcement that Blueprint will be acquired by Sanofi (SNY) in a cash transaction of $129 per share plus contingent value rights considerations for pipeline asset BLU-80. Top 5 Downgrades: Needham downgraded Apple (AAPL) to Hold from Buy without a price target, and reduced estimates citing threats to Apple's near-term revenue and earnings growth. The firm believes that for the stock to work, Apple must have the catalyst of an iPhone replacement cycle, which Needham does not foresee in the next 12 months. BofA downgraded CrowdStrike (CRWD) to Neutral from Outperform with a price target of $470, up from $420. While the firm favors CrowdStrike's fundamentals and growth prospects, it believes the valuation "leaves only limited upside" from current levels, noting that its raised price target implies 3% upside potential at the after-hours closing price of $457. Canaccord and Evercore ISI also downgraded the stock to Neutral-equivalent ratings. Citi downgraded Constellation Energy (CEG) to Neutral from Buy with a price target of $318, up from $232. The firm cites valuation for the downgrade following Constellation's stock rally and Meta (META) power agreement announcement. National Bank downgraded Algonquin Power (AQN) to Sector Perform from Outperform with an unchanged $6.75 price target. The company's investor update provided visibility on three-year earnings reset, with earnings growth being driven largely by operating cost discipline and completion of rate cases, though with the stock up 40% this year and 16% today, a neutral stance is warranted, the firm tells investors in a research note. More cautious on the stock, Guggenheim downgraded Aptiv (APTV) to Neutral from Buy. Top 5 Initiations: Bernstein initiated coverage of the U.S. entertainment sector with Outperform ratings on Live Nation (LYV), Spotify (SPOT), DraftKings (DKNG), TKO Group (TKO) and Warner Music (WMG), and Market Perform ratings on Liberty Formula One (FWONK) and Flutter Entertainment (FLUT). The firm recommends owning large cap names on the core belief that superfans, the most engaged and price insensitive cohort of content consumers, will be the key driver of growth and profitability in the next phase of the industry. UBS initiated coverage of Packaging Corp. (PKG) with a Neutral rating and $200 price target. The firm says Packaging Corp. remains a strong operator, but market expectations are above consensus forecasts. UBS initiated coverage of International Paper (IP) with a Buy rating and $60 price target. The firm names International Paper its top pick of the four paper packaging stocks. Over time, it sees 50% EBITDA growth from 2025 to 2027, which UBS believes should cause the stock to re-rate. UBS initiated coverage of Graphic Packaging (GPK) with a Neutral rating and $24 price target. The firm says the company is being impacted by volume declines at its Consumer Packaged Goods and Quick Service Restaurant customers. UBS initiated coverage of Sonoco (SON) with a Neutral rating and $48 price target. The firm's view on Sonoco is balanced. Sign in to access your portfolio
Forbes
34 minutes ago
- Forbes
Can Artifical Intelligence Save America From Its Debt Spiral?
Jamie Dimon isn't one to cry wolf. So when the JPMorgan CEO says 'you are going to see a crack in the bond market,' it's worth listening. And he's not alone. Ray Dalio, Peter Orszag, and Paul Tudor Jones are all sounding the alarm on America's fiscal trajectory. The math is getting hard to ignore. Interest on the debt just crossed $1 trillion annually — more than the U.S. spends on defense, Medicaid, disability insurance, and food stamps combined. The One Big Beautiful Bill Act (OBBBA), if passed without offsets, could add $5 trillion to the debt over the next decade. According to the Committee for a Responsible Federal Budget, that pushes total public debt to nearly $57 trillion by 2034 — a number so large it's bordering on abstract. US Debt-to-GDP Ratio; Historical & projected If 10-year bond yields simply hold at today's ~4.4%, the CRFB estimates we add another $1.8 trillion in interest cost. And if rates rise further, a debt spiral isn't a tail risk — it's the baseline. But here's the problem: everyone agrees on the diagnosis. No one agrees on the cure. Raising taxes? Politically impossible. Cutting entitlements? Untouchable. Both parties have proven incapable of fiscal restraint — even in peacetime. So what's left? If the U.S. is going to escape its debt doom loop, we'll need to grow through it — not tighten into it. And the most credible engine for that growth isn't austerity. It's artificial intelligence. We are standing at the front end of a once-in-a-century platform shift. AI isn't just another tech cycle — it's a horizontal capability that will transform every sector of the economy, from finance and logistics to energy, healthcare, and defense. AI isn't just another tech cycle. It's a general-purpose capability that could rewire the productivity backbone of every sector — from private credit and logistics to defense, software, and healthcare. Already, we're seeing AI reduce due diligence cycles from weeks to hours, compress legal reviews by 80%, and deliver spreadsheet analysis with near-perfect accuracy. AI-powered copilots aren't replacing humans — they're multiplying the throughput of every knowledge worker. If this productivity surge lifts U.S. real GDP from ~2% to 3–4%, and inflation stays modest, we could see nominal GDP growth exceed 5% annually — fast enough to outgrow the debt even if rates remain elevated. That's not wishful thinking — it's historical precedent. After WWII, the U.S. carried debt loads above 100% of GDP. We didn't cut our way out. We grew — averaging nearly 4% real GDP growth for two decades through innovation, infrastructure, and industrial scaling. This isn't an argument to ignore the wolf. It's a call to outrun it. Yes, 3–4% real growth is aggressive. But it's not impossible. It happened before — and it could again if AI unlocks true economy-wide productivity gains. The U.S. has unique advantages: it leads the world in foundational models, semiconductors, cloud infrastructure, and startup formation (yes, we still need more energy to power this expansion). If AI is going to remake the modern economy, it will start here. Done right, AI can unleash the kind of broad-based productivity boom that defined the post-WWII economic miracle. Between 1947 and 1973, U.S. real GDP grew nearly 4% annually, driven by industrial innovation, global leadership, and a rising middle class. We've been chasing that growth rate ever since. And the numbers back it up. Vanguard projects that AI adoption could boost labor productivity by 20% by 2035, lifting U.S. GDP growth to 3%+ annually — the fastest pace since the 1990s. JPMorgan Private Bank sees productivity gains materializing as early as the late 2020s, lifting growth above 2.5%. And according to the AI Coalition, AI could raise long-run productivity growth by 0.8 to 1.5 percentage points per year — a massive unlock in a mature $27 trillion economy. Yes, even 3–4% might not be enough if interest rates spiral. But today's 4.4% Treasury yield isn't permanent — it's a reflection of uncertainty, not inevitability. If AI stabilizes growth expectations, that could anchor yields and restore fiscal confidence. The spread between nominal growth and average borrowing costs is the most important line on the chart — and AI could flip it back in our favor. Yes, productivity gains may be uneven or delayed. That's true of any general-purpose technology. Electricity and the internet took years to show up in the data. But early results are already promising — especially in high-leverage sectors like finance, law, and logistics. And no, growth alone won't fix Medicare or solve Social Security. But it will buy time — and make eventual reforms more politically and economically feasible. AI is not a substitute for tough decisions. It's the only viable bridge to a sustainable future. The original Marshall Plan powered postwar recovery through investment and innovation. AI can do the ... More same for America today. Post-WWII America didn't just survive high debt. It flourished — building a dominant economy powered by innovation, infrastructure, and productivity. We now face a similar inflection point. This time, AI is the catalyst. We have a choice: treat AI like a regulatory threat, or embrace it as a national growth strategy. Because the truth is, America doesn't have a debt problem — it has a growth problem. And the longer we delay confronting that reality, the more constrained our options become. If AI can unlock a new era of economic abundance, it won't just be good for business. It may be the only way to save the Republic's balance sheet.
