CNBC Morning News
1. Short but dense week ahead
U.S. equities markets face a shortened week after the three-day Juneteenth holiday weekend. Whether stocks can continue their momentum from last week, though, remains an open question. The S&P 500 and the Nasdaq, in particular, are on hot streaks. The former has posted five straight winning weeks, while the latter is on an eight-week run, something it hasn’t done since November 2019. While the Federal Reserve’s rate-hiking pause may have lifted spirits among investors, all ears will be listening for hints about the central bank’s next steps from several Fed speakers this week. New York Fed President John Williams and Fed Vice Chair for Supervision Michael Barr will appear together at an event Tuesday, while Chairman Jerome Powell is scheduled to testify before lawmakers Wednesday and Thursday. Follow live market updates.
2. Big changes at Alibaba
Alibaba, the Chinese e-commerce and tech giant, shook up its leadership structure as it embarks on a sweeping corporate restructuring into six business units. The company said Daniel Zhang will step down from his CEO role and focus more on Alibaba’s cloud operations. “Cloud Intelligence Group is now full speed ahead on its spin-off plans and we are approaching a crucial stage of the process, so it is the right time for me to dedicate my full attention and time to the business,” he said in a memo to employees. Eddie Wu will take Zhang’s spot as CEO, while Brooklyn Nets owner Joe Tsai will become chairman after previously serving as executive vice chair.
3. Bad weekend for Disney and Warner Bros.
After months of hype, it sounded like Warner Bros. Discovery had lightning in the bottle with its latest big-budget DC Comics movie, “The Flash,” but those hopes fizzled this weekend. The superhero movie, which features troubled actor Ezra Miller and a slew of live action and CGI cameos, came in well below estimates for its opening weekend, drawing only $55 million. But Warner wasn’t the only studio with issues over the weekend. Disney’s animated “Elemental” had the lowest opening of any Pixar release since the original “Toy Story” in 1995 – and that’s without taking inflation into consideration. (MG Note: In this movie, DIsney introduced its first "non-binary character. Seems movie goers are talking back to Disney). There won’t be much new competition at the box office this coming weekend, so maybe there’s a chance both movies can do OK in week 2. But it appears as though audiences are already getting their superhero and animation fixes from the dominant “Spider-Man: Across the Spider-Verse.”
4. Blinken in China
U.S. Secretary of State Antony Blinken traveled to China over the long weekend in a bid to ease escalating tensions between the two major powers. His trip included a surprise visit with Chinese President Xi Jinping, prompting positive signals from both sides. U.S. President Joe Biden said Blinken “did a hell of a job.” “We’re on the right trail here,” the president added. The Xi-Blinken meeting could also set the stage for a meeting between the two presidents later this year. Several issues remain, however, including frosty relations between the countries’ military leaders, particularly in light of growing global concern over China’s designs for Taiwan, which China claims as its own. Blinken said he repeatedly mentioned the need to restart military talks, but “China China does not agree to move forward with that.”
5. Hyundai ponders Tesla partnership
Hyundai is considering whether to join Ford and General Motors in using Tesla’s charging technology in North America. Elon Musk’s EV giant dominates the market for fast-charging stations in the U.S. Increased adoption of the tech, known as the North American Charging Standard, should be a boost to legacy automakers trying to catch up to Tesla, while Tesla should reap profits, as well. For Hyundai, it will be a matter of whether Tesla can adapt to the South Korean automaker’s higher-voltage charging demands. “That’s what we will look into from the customer’s perspective,” Hyundai CEO Jaehoon Chang said.
— CNBC’s Mike Calia wrote this newsletter. Brian Evans, Clement Tan, Arjun Kharpal, Sarah Whitten, Sheila Chiang and Evelyn Cheng contributed.
