Distinction Matter - Subscribed Feeds

Authored by Matthew Vadum via The Epoch Times (emphasis ours),

The Department of Justice urged the Supreme Court on May 13 to let the Department of Government Efficiency (DOGE) have access to Social Security data after lower courts blocked that access.

The U.S. Supreme Court in Washington on April 3, 2025. Madalina Vasiliu/The Epoch Times

President Donald Trump issued Executive Order 14158 on Jan. 20, implementing DOGE, an advisory body that recommends cost-cutting measures. The order directed the entity to “implement the President’s DOGE Agenda, by modernizing Federal technology and software to maximize governmental efficiency and productivity.”

Solicitor General D. John Sauer argued in the new filing that the lower courts have overreached and are attempting to turn themselves into “the human resources department for the Executive Branch.”

The filing came after Ellen Lipton Hollander, a Maryland-based federal district court judge, issued an order on March 20 preventing DOGE from viewing Social Security Administration (SSA) records because such access “violates” the federal Privacy Act.

The lawsuit was brought in February by labor unions and retirees represented by the Democracy Forward Foundation.

“The DOGE Team is essentially engaged in a fishing expedition at SSA, in search of a fraud epidemic, based on little more than suspicion. It has launched a search for the proverbial needle in the haystack, without any concrete knowledge that the needle is actually in the haystack,” the judge wrote in granting a temporary restraining order against the federal government.

DOGE’s team at the Social Security Administration has had “unbridled access to the personal and private data of millions of Americans, including but not limited to Social Security numbers, medical records, mental health records, hospitalization records, drivers’ license numbers, bank and credit card information, tax information, income history, work history, birth and marriage certificates, and home and work addresses,” Hollander wrote.

Hollander directed DOGE to delete any personally identifiable data in its possession. On April 17, Hollander upgraded the temporary restraining order to a preliminary injunction.

On April 30, the U.S. Court of Appeals for the Fourth Circuit voted 9–6 to maintain Hollander’s order while the appeal process continues.

On May 2, the Trump administration filed an emergency appeal with the Supreme Court, asking the justices to pause the preliminary injunction.

In the May 13 filing, Sauer argued that the district court erred in preventing “the 11 members of the Social Security Administration (SSA) DOGE team—from accessing data ... for purposes that are unquestionably lawful.”

The district court “dictated to the Executive Branch which government employees can access which data and even prescribed necessary training, background checks, and paperwork for data access,” Sauer wrote.

“When district courts attempt to transform themselves into the human resources department for the Executive Branch, the irreparable harm to the government is clear,” he wrote.

When the courts “stymie the government’s initiatives to modernize badly outdated systems and combat rampant fraud—leaving those initiatives on a litigation track that may halt them for months or years—the irreparable harm is even clearer.”

Reviewing Social Security Administration data is important because the agency has “one of the largest documented histories of improper payments,” Sauer stated.

In a brief in opposition filed on May 12, the lead respondent, the American Federation of State, County, and Municipal Employees, said that after years of honoring “its data security obligations,” the Social Security Administration “now seeks to throw open its data systems to unauthorized (and often unvetted) personnel who have no demonstrated need for the personally identifiable information ... they seek.”

The April 17 preliminary injunction should be left in place because it is “narrow and, contrary to the government’s assertions, permits SSA to disclose both anonymized and non-anonymized data to DOGE Team members,” the brief said.

The Supreme Court could rule on the government’s emergency application at any time.

Jack Phillips contributed to this report.

By Benjamin Picton, Rabobank Senior Macro Strategist

Patience To See

Tech names drove the NASDAQ and S&P500 to further gains yesterday, while the Dow Jones fell for a second-straight session. Semiconductors performed especially well as fund managers caught underweight high-beta US megacaps continued a buying spree that was sparked by a 90-day tariff reduction between the US and China announced on Monday. Nvidia posted a 4.16% gain and AMD was up 4.68% as both companies inked deals with Saudi Arabia to sell more chips for AI applications. European stocks underperformed with most major indexes closing lower, and the Nikkei fell as funds flowed back into Hong Kong’s Hang Seng index and China’s CSI300.

While stocks were rising, US 10-year bond yields poked back above the psychological 4.50% level to close the day up 6bps at 4.54%. 30-year Treasury yields closed half a bip below the intraday highs at 4.98%, which means that yields on both the 10-year and the 30-year are now trading above the levels that were in effect on April 9th when the Trump administration apparently cried “uncle!” in response to bond market pressure and kicked the implementation of reciprocal tariffs into the long grass for 90 days.

Perhaps we are about to find out whether it really was rising bond yields that forced the about face on those reciprocal tariffs, or if Scott Bessent has some other rabbit to pull out of his hat to force long yields lower. Rising bond yields is a problem for America’s chief bond salesman who has trillions of Dollars’ worth of debt to refinance in the months ahead. With the Fed still engaged in quantitative tightening, and enormous budget deficits still being run (despite DOGE), Bessent is going to have to work hard to sniff out other bids, and US homebuyers better hope that he can convince offshore investors that Treasuries yielding 4.5-5% are just too juicy to last. One wonders how durable the rally in long-duration tech can be while yields on long bonds are making new highs.

Fed Speakers yesterday offered no help to the Treasury Secretary by giving the impression that there is no rush to cut the Fed Funds rate any further. Mary Daly said that the Fed had to have “patience to see, not to guess”, which seems to discount the possibility of any kind of pre-emptive policy action. Daly also said that if you take a step back from all the tariff uncertainty the underlying economy is experiencing solid growth, with a strong labor market and declining inflation. That assessment might be a little bit like saying that the Dinosaurs were in really good shape if you ignore the uncertain effects of the approaching meteor. 

In the land of hard data, the US economy shrank in Q1 because of a surge in imports that could be replicated in Q2 as the 90-day reprieve on China tariffs encourages importers and retailers to “reload the gun” on goods inventories. Two consecutive quarters of negative growth is the definition of a recession, but get ready for plenty of commentators to suggest that this one doesn’t really count (it wouldn’t be the first time!).

Meanwhile, President Trump continues his dealmaking tour of the Middle East where Qatar has now reportedly agreed to purchase as many as 210 new jets from Boeing. This comes off the back of the semiconductor, energy and military hardware deals signed in Saudi Arabia, Trump’s announcement that sanctions on Syria will be lifted and his meeting with the new Syrian President, who he urged to normalize relations with Israel.

It’s worth pointing out that while the markets were mostly focused on deals to sell more US chips and US energy, there were also announcements of new sanctions on companies facilitating the sale of Iranian oil to China and a new guidance issued by the Commerce Department that the use of Huawei’s Ascend AI chips “anywhere in the world” constituted a violation of US export controls. 

As this Daily noted yesterday, 90-day tariff reduction notwithstanding, what is happening in the Middle East and with trade more broadly should serve as a signal that geopolitical competition between the United States and China isn’t going away.

Apple is turbocharging its "friend-shoring" strategy by shifting more iPhone production from China to India—a move that could soon result in American consumers purchasing iPhones made in India. However, during President Trump's Gulf tour, he expressed new concern over the supply chain shift (at least for the first time publicly), urging Apple CEO Tim Cook to re-shore some of that iPhone production to the United States. 

"I had a little problem with Tim Cook yesterday," Trump told reporters in Qatar on Thursday, on his latest leg of his Middle East tour. The president said his problem centers around Indian factories producing a "majority" of iPhones for the U.S.

Trump criticized Cook's plan: "I said to him,' My friend, I treated you very well. You're coming here with $500 billion, but now I hear you're building all over India.' I don't want you building in India."

As a result of their meeting, Trump said Apple will be "upping their production in the United States."

"I told Tim Cook we're not interested in you building (Apple) in India, they can take care of themselves, you up your production here (US)," claimed Trump. He added that India was one of the highest tariff-imposing countries & has now made an offer to reduce tariffs significantly… pic.twitter.com/11p9okfjTg

Earlier in the week, in the first leg of his tour, Trump praised Nvidia CEO Jensen Huang at the Saudi-U.S. Investment Forum in Riyadh, saying: "Tim Cook isn't here, but you are."

Trump's comments follow a recent Financial Times report indicating that Apple's friend-shoring strategy could result in as many as 60 million iPhones being produced in India by 2026—or the amount required to satisfy the U.S. market.

• Apple Races To Boost iPhone Production In India, Vietnam As Trump Pauses Tariffs

• Apple Turbocharges Friendshoring: Your Next iPhone Could Be Made In India

Apple does not produce smartphones in North America but has pledged to invest $500 billion in the U.S. market over the next four years.

Wall Street analysts have estimated that U.S. iPhone production would take years and cost tens of billions of dollars.

U.S. Commerce Secretary Howard Lutnick recently spoke with Cook about ramping up iPhone production in the U.S. Cook told Lutnick that "robotic arms" would be needed for production lines. 

Lutnick said, "He's going to build it here," adding, "And Americans are going to be the technicians who drive those factories. They're not going to be the ones screwing it in."

Wedbush Securities recently estimated that a fully American-made iPhone could cost as much as $3,500, compared to the current average price of around $1,000. There are reports the next model could see the first price hike since the 2017 debut of the iPhone X.

Next lineup of iPhone...

Tarun Pathak, research director at tech analytics firm Counterpoint, said Trump's comments are a "familiar tactic from the president. He wants to push Apple to localize more and build a supply chain in the U.S., which is not going to happen overnight," adding, "Making in the US will also be much more expensive than assembling iPhones in India." 

Authored by Jonathan Turley,

Today, the United States Supreme Court will hear three consolidated cases in Trump v. CASA on the growing use of national or universal injunctions. This is a matter submitted on the “shadow docket” and the underlying cases concern the controversy over “birthright citizenship.” However, the merits of those claims are not at issue. Instead, the Trump Administration has made a “modest request” for the Court to limit the scope of lower-court injunctions to their immediate districts and parties, challenging the right of such courts to bind an Administration across the nation.

The case is the consolidation of three matters: Trump v. CASA out of  Maryland; Trump v. Washington out of Washington State, and Trump v. New Jersey, out of Massachusetts. These cases also present standing issues since the Administration challenges the argument that there is a cognizable “injury” to individuals who may travel to the states bringing the actions.

However, the main question is the scope of injunctions.

As I have previously written, district court judges have issued a record number of injunctions in the first 100 days of the Trump Administration. 

Under President George W. Bush, there were only six such injunctions, which increased to 12 under Obama. 

However, when Trump came to office, he faced 64 such orders in his first term.

When Biden and the Democrats returned to office, it fell back to 14. 

That was not due to more modest measures. 

Biden did precisely what Trump did in seeking to negate virtually all of his predecessors’ orders and then seek sweeping new legal reforms. He was repeatedly found to have violated the Constitution, but there was no torrent of preliminary injunctions at the start of his term.

Yet, when Trump returned to office, the number of national injunctions soared again in the first 100 days and surpassed the number for the entirety of Biden’s term.

This is a rare argument. 

First, it is a shadow docket filing that usually results in summary decisions without oral argument. Moreover, this matter came after what is commonly viewed as the final day for oral arguments. The Court granted a rare late oral argument, reflecting that multiple justices view this matter sufficiently serious to warrant a break from standard operating procedures.

Rather than arguing a “question presented” on birthright citizenship, the Administration is solely looking for limits on the district courts as appeals continue on the “important constitutional questions” raised by birthright citizenship.

The Administration argues that the Constitution does not give judges the power to issue universal injunctions and that courts are limited to addressing the cases before them in a given district. The Administration acknowledges that class actions can create the basis for universal injunctions, offering a moderate resolution to the Court. In such cases, if the parties can meet the standard for a national class, they can seek a national or universal injunction.

In today’s arguments (which I will be covering for Fox and on X), we can expect to hear from justices who have previously been critical of universal injunctions, including Justice Clarence Thomas, who, in his concurring opinion in Trump v. Hawaii, called them “legally and historically dubious.”

Likewise, Justices Gorsuch and Alito have criticized such injunctions. In a prior dissent to an emergency filing in Department of State v. AIDS Vaccine Advocacy Coalition, Alito was joined by Thomas, Gorsuch, and Kavanaugh in stating that the government “has a strong argument that the District Court’s order violates the principle that a federal court may not issue an equitable remedy that is ‘more burdensome than necessary to’ redress the plaintiff’s injuries.”

Many of us will be watching three members the most closely: Chief Justice John Roberts and Associate Justices Elena Kagan and Amy Coney Barrett. Roberts is the ultimate institutionalist, and we should see in his argument how he views the impact of such injunctions on the court system as a whole. He is very protective of the courts’ inherent authority but may also have misgivings about the scope of these orders.

During the Biden Administration, Justice Kagan has previously criticized universal injunctions. In an interview at Northwestern University Law School, Kagan flagged the “forum shopping” by litigants in filing cases before favorable courts:

“You look at something like that and you think, that can’t be right. In the Trump years, people used to go to the Northern District of California, and in the Biden years, they go to Texas. It just can’t be right that one district judge can stop a nationwide policy in its tracks and leave it stopped for the years that it takes to go through the normal process.”

Justice Barrett previously joined with Kavanaugh in stating that the power of district courts to enter a universal injunction “is an important question that could warrant our review in the future.”

The argument today will start at 10 am and I will be doing a running review of the arguments on X.

U.S. Solicitor General D. John Sauer will argue the government’s case.

Jeremy Feigenbaum, New Jersey’s solicitor general, will argue for the state and local governments and  Kelsi Corkran, the Supreme Court director at Georgetown’s Institute for Constitutional Advocacy and Protection, will argue for the private individuals and groups.

Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University where he teaches a course on the Supreme Court and the Constitution.

The number of Americans filing for jobless benefits for the first time was flat from the prior week at 229k (the same level it was at in Jan 2022)...

Source: Bloomberg

Headline continuing claims remains below the Maginot Line of 1.9 million Americans...

Source: Bloomberg

But, drilling down, the 'Deep Tristate' saw initial jobless claims spike last week...

Source: Bloomberg

...and continuing jobless claims in the 'Deep TriState' also rose as perhaps DOGE is starting to have some effects...

Source: Bloomberg

Finally, the chart that sums up the entire farcical FUD-fest about the US labor market and Trump's terrible tariff trauma...

Source: Bloomberg

When will the CEOs face reality?

Following the cooler than expected CPI, US Producer Prices plunged in April, down 0.5% MoM (vs +0.2% MoM exp) - the biggest drop since April 2020 (but we note that last month's 0.4% MoM decline was revised up to unchanged). The headline print was dragged down to +2.4% YoY (the lowest since Sept 2024)...

Source: Bloomberg

Under the hood, Prices for final demand services moved down 0.7 percent in April, the largest decline since the index began in December 2009.

Source: Bloomberg

Core Producer Prices plunged by the most on record (back to 2010)...

Source: Bloomberg

PPI Final Demand Services

Prices for final demand services moved down 0.7 percent in April, the largest decline since the index began in December 2009. Over two-thirds of the broad-based decrease can be traced to margins for final demand trade services, which dropped 1.6 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand services less trade, transportation, and warehousing and for final demand transportation and warehousing services fell 0.3 percent and 0.4 percent, respectively.

• Product detail: Over 40 percent of the April decline in the index for final demand services is attributable to margins for machinery and vehicle wholesaling, which dropped 6.1 percent. The indexes for portfolio management, food and alcohol wholesaling, system software publishing, traveler accommodation services, and airline passenger services also fell. Conversely, prices for outpatient care (partial) advanced 0.3 percent. The indexes for furniture retailing and for inpatient care also moved up. (See table 2.)

PPI Final demand goods

Prices for final demand goods were unchanged in April following a 0.9-percent decrease in March. In April, the index for final demand goods less foods and energy increased 0.4 percent. In contrast, prices for final demand foods and for final demand energy declined 1.0 percent and 0.4 percent, respectively.

• Product detail: Among final demand goods in April, the index for general purpose machinery and equipment advanced 1.1 percent. Prices for residential electric power, fresh and dry vegetables, non-electronic cigarettes, and utility natural gas also moved up. Conversely, the index for chicken eggs dropped 39.4 percent. Prices for gasoline, gas fuels, diesel fuel, and primary basic organic chemicals also fell.

Margin pressure remains on American corporations...

Source: Bloomberg

It would appear that despite all the FUD, companies are soaking up any tariff price increases and NOT passing them on to customers.

Finally, energy prices are set to drag CPI and PPI even lower in the next month or so...

Source: Bloomberg

Goldman has lowered its PCE expectations: 

Based on the details in the PPI and CPI reports, we estimate that the core PCE price index rose 0.11% in April (vs. our expectation of 0.19% prior to today's PPI report), corresponding to a year-over-year rate of +2.46%.

Additionally, we expect that the headline PCE price index increased 0.10% in April, or increased 2.18% from a year earlier.

But, but, but... the PhDs said tariffs were inflationary!!

A team of Russian negotiators are in Istanbul on Thursday for the first direct peace talks with Ukraine in more than three years, with Russia's Foreign Ministry officials saying that the delegation is "ready for serious work".

President Putin, who as expected is not there in person, tapped his aide and former culture minister Vladimir Medinsky to lead the talks, which many Western analysts have claimed is an 'insult' given it's not someone more senior. Medinsky, it should be remembered, oversaw the failed 2022 peace talks with Kiev in the weeks after the February invasion.

Alongside Medinsky are Deputy Foreign Minister Mikhail Galuzin, Deputy Defense Minister Alexander Fomin and Igor Kostyukov, the head of Russia’s military intelligence agency (GRU).

Supporting these main negotiators are group of advisers, including senior officials from the Foreign and Defense Ministries, along with Putin aides. The Kremlin confirmed the identities of its negotiating team by releasing footage of Putin meeting with the negotiation group late Wednesday.

On Wednesday evening, Russian President Vladimir Putin held a meeting to discuss arrangements for talks with Ukraine, due to take place today in Istanbul, Kremlin Spokesman Dmitry Peskov told reporters:https://t.co/hRmXK7daoA

Video: Kremlin. ru pic.twitter.com/1e7DHMlFgv

Other top officials were seen present in the send-off meeting in Russia, among them Defense Minister Andrei Belousov, Russia’s chief of the General Staff Valery Gerasimov, Security Council Secretary Sergei Shoigu and Federal Security Service (FSB) Director Alexander Bortnikov - which perhaps underscores that Moscow is indeed taking the Istanbul talks very seriously.

But many are calling this a 'slap in the face' and insult to Trump who has strongly backed direct talks, and who even urged Putin to be there in person. 

Trump has warned that he is "always considering" additional sanctions against Russia if he believes Moscow is blocking or snubbing the peace process.

Putin sending the same people to Istanbul who, back in 2022, demanded Ukraine's surrender on his behalf is a slap in the face to the Trump administration’s efforts to end this war. The message is clear: fuck off — I have my own objectives, and they haven’t changed since 2022,… https://t.co/8Sj3mprJXe

As for Ukraine's President Zelensky, he's has for the past week been making a big show of how he's willing to be in Istanbul, and Putin is not. He's been repeatedly goading Putin to be there, saying that if he's not - it proves Moscow is not interested in the peace process. 

However, this has clearly been a performative effort more geared to show President Trump that Kiev is 'willing' - likely in hopes that Washington gives Zelensky stronger backing, and of course a steady supply of weapons and intelligence. To some degree, Zelensky's bellicose rhetoric may itself have sabotaged talks before they had even begun.

But Zelensky has shown up in Turkey, somewhat surprisingly. "I am here" - he has emphasized (in once again a bit of messaging primarily aimed at the White House). He's meeting with Erdogan, but apparently this is separate, and happening in Ankara. 

Zelensky to Putin from Ankara:

"I am here." pic.twitter.com/67RjF4QFqb

The Wall Street Journal's take is as follows:

"Ignoring Ukrainian President Volodymyr Zelensky’s call to meet for direct high-level talks in Turkey, Russian leader Vladimir Putin dispatched to Istanbul a team of junior officials, making it uncertain that negotiations between the warring nations would occur at all."

But Russia analyst and author of Forged In War: A Military History of Russia From its Beginnings To Today, Mark Geleotti, has a very different take, featured below [emphasis ZH]:

It’s easy (and not wholly untrue) to slam Vladimir Medinsky, leading the Russian delegation to Istanbul as a nobody, but perversely, although I think it monstrously unlikely anything meaningful will come from the talks, the composition of the delegation is encouraging.

Putin was never likely to attend, not least as he wasn’t going to allow it to look as if he had been manipulated and dared by Zelensky. Besides, sometimes it can help break a logjam (think Reagan/Gorbachev), but leaders usually turn up to seal the deal at the end of the process, after experts have done all the hard preparatory work away from the cameras.

Do we honestly think two men who so plainly loathe each other and who have been shamelessly posturing for Trump's benefit were going to reach some kind of meeting of minds? Possible, but unlikely.

Medinsky led the talks in 2022 that failed to reach a usable deal (we can discount the myth that Zelensky was about to agree to Russia's demands until Boris Johnson nixed it) so this is meant to signal continuity in process and demands.

Medinsky's very lack of personal authority isn’t a snub, so much as a sign that Putin wants to manage any process by remote control. He's a human drone, which at least means any positions he advances/agrees already have VVP's ok

The rest of the delegation likewise isn't showy (though the presence of military intel chief Kostyukov is interesting as they were key in POW swaps) but likewise meant to signal a willingness to do serious work. (Although this doesn’t necessarily mean make necessary compromises).

Of course, with no hint that Russia is about to relax its implausible and unfair demands, this may all be for show. It probably is, alas. But talking is always good as there is a *chance*, however minuscule, that talks can lead somewhere.

So although Medinsky is a shallow ideologist, and sending him is in a way a snub, a means for Putin to try and reject Zelensky's challenge while not looking wholly uncooperative in Trump's eyes.

…whereas before I was 99% pessimistic about the talks, now I’m only 98% so. That is as much room for optimism as there is, these days.

US equity futures are lower as investors take profits on Thursday and tech stocks fell as investors worried about an economic slowdown after Steve Cohen warned the chance of a recession is 45% and today’s retail sales numbers are expected to be a miss. As of 8:00am ET, S&P futures are down 0.4%, rebounding from session lows after Walmart reported solid earnings; Nasdaq futures dropped 0.5% with Nvidia, Palantir and Tesla falling about 2% in early trading.  On Wednesday, the S&P failed at 5,900 for the second consecutive day. The silver lining according to JPM is that yesterday, NVDA turned positive on the year, joining META and MSFT; if the remaining members follow suit, there is another ~10% upside to the index assuming positive members are flat. YTD, AMZN is -4.2%, GOOG -12.6%, TSLA -13.9%, and AAPL -15.2%. In trade news, China removed curbs on rare earth exports to the US. Trump says India is willing to drop is tariffs on US goods. Brent sank below $64, down more than 3% after President Donald Trump said the US is getting closer to a deal on Iran’s nuclear program, fueling concern that additional oil supply may pressure the market. Bond yields and the USD are lower. Today’s macro data focus is on Retail Sales which are expected to remain unchanged in April (versus 1.5% prior); PPI, Jobless Claims, Philly Fed and Empire Manufacturing numbers are due at 8:30 am in New York, while Industrial Production prints at 9:15am. Also, traders are looking ahead to a speech by Federal Reserve Chair Jerome Powell.

In premarket trading, UnitedHealth shares sank after the WSJ reported it’s under criminal investigation for possible Medicare fraud. Walmart delivered another quarter of solid sales and earnings growth, and cautioned that tariffs and increasing economic turbulence means even the world’s largest retailer can’t hold off on price increases forever. Shares gained 2.4% premarket. Magnificent Seven stocks are lower as risk appetite falters (Tesla -1.8%, Apple -1%, Meta Platforms -1%, Amazon -0.8%, Alphabet -0.7%, Nvidia -0.6%, Microsoft -0.5%). Here are some other notable premarket movers:

• Alibaba ADRs (BABA) decline 5.6% after reporting revenue that missed estimates, dragged by a slowing international e-commerce arm and its Cainiao logistics business that’s under restructuring.
• Boot Barn (BOOT) rises 13% after the retailer of western wear gave a forecast for 1Q same-store sales growth that surpassed Wall Street estimates, despite an expected hit from tariffs.
• Cisco Systems (CSCO) rises 3.3% after the company gave a solid forecast for revenue in the current quarter, a sign the largest seller of networking gear is benefiting from demand for systems using AI technology.
• CoreWeave (CRWV) shares fall 6.6% after the cloud-computing provider’s quarterly profit forecast missed estimates due to some spending being brought forward.
• Crowdstrike Holdings (CRWD) shares are down 2.4% in premarket trading, after Mizuho Securities downgraded the software company to neutral from outperform.
• DXC Technology (DXC) shares are down 14% after the company reported forecast adjusted earnings per share for the first quarter and 2026 full-year guidance that missed the average analyst estimate.
• Dlocal (DLO) shares gain 21% after the financial technology company beat earnings expectations and unveiled plans for a special dividend.
• Foot Locker (FL) is up 84% with Dick’s Sporting Goods to buy it in a cash or stock deal implying an equity value of about $2.4 billion and an enterprise value of about $2.5 billion.
• JetBlue (JBLU) falls 1.6% after Raymond James downgraded the airline company to market perform from outperform, citing a more balanced risk-reward amid an improvement in sentiment.
• Luminar (LAZR) drops 13% after the automotive technology company’s CEO Austin Russell resigned as CEO, overshadowing better-than-expected first-quarter sales.
• NetEase ADRs (NTES) are up 6.7% after the China-based video-game company reported first-quarter results that beat expectations.
• New Fortress Energy (NFE) shares slump 38% after the energy infrastructure firm saw adj. Ebitda plunge in the first quarter, with analysts flagging that the sale of its Jamaican assets will dent cash flow.

There’s also some big company news to digest. Trump wants Apple to stop moving iPhone production to India, while Starbucks is said to be considering options to revamp its China business, including a possible stake sale.

Economic forecasters this week have said that while the Trump administration’s temporary trade deal with China has reduced the risk of a recession, the overall economy is likely to slow. “There’s definitely more clarity than a few weeks ago,” Dubravko Lakos-Bujas, chief of global markets strategy at JPMorgan Chase & Co., said in a Bloomberg Television interview. “Some of the uncertainty around trade, tariffs, policy started to get reined in.”

“The market is globally priced for perfection,” said Michael Nizard, head of multi-asset at Edmond de Rothschild Asset Management. “The retail sales figures should reveal that consumer is already depressed in terms of business confidence.”  

Meanwhile, billionaire Steve Cohen, speaking at the Sohn Investment Conference on Wednesday, put the chances of a US recession at about 45%. Cohen, the founder of hedge fund Point72 Asset Management, said he doesn’t expect the Federal Reserve to cut rates right away, because “they are going to be worried about inflation from tariffs.” He said he expects US economic growth next year to slow to 1.5% or less, “which is OK but not phenomenal.”

Looking at today's macro data, Retail sales are expected to rise by a tepid 0.1% in April (versus 1.5% prior) according to Bloomberg economists, while a survey of economists is pointing to flat month-on-month sales. PPI and Empire Manufacturing numbers are due at 8:30 am in New York. Traders were looking ahead to a speech by Federal Reserve Chair Jerome Powell, as well as data on manufacturing and retail sales, for the next readout on US growth and inflation. Economists are expecting no growth in retail sales in April as consumers cut back on some purchases. 

European stocks retreat for a second day. Energy stocks lead declines, driven by a fall in oil prices following a report that Iran is willing to forgo nuclear weapons in a deal with the US, while utilities and food and beverage stocks outperform. Among individual stocks, insurance firm Allianz drops after disappointing results. Stoxx 600 falls 0.2% to 542.88 with 327 members down, 263 up, and 10 little changed. Here are the biggest European movers:

• KBC shares rise as much as 2.6% after the Belgian lender reported earnings that analysts said were roughly in line with expectations, and saw a boost from increased insurance revenues.
• Engie shares gain as much as 2.2% after the utility produced what analysts said were strong results that should provide further comfort around full-year guidance and the dividend.
• Serco shares rise as much as 6.9% after the outsourcing-services company announced the award of three contracts with a combined value of more than £1b to provide maritime services for the Royal Navy.
• Watches of Switzerland shares rise as much as 6.7% after the watch seller’s update showed no deterioration in trends in either the UK or US, providing some relief to investors.
• Energy stocks are the worst-performing sector as oil falls following a report that Iran is willing to forgo nuclear weapons in a deal with the US in exchange for sanctions relief.
• Allianz shares fall as much as 3.9% after the German insurer reported earnings that analysts called disappointing.
• 3i shares drop as much as 8.1% following the private equity firm’s full-year results, with net asset value per share coming in marginally below analyst expectations.
• Deutsche Telekom shares decline as much as 1.2% after the telecom operator reported mixed trends in its home market Germany.
• Thyssenkrupp shares fall as much as 14% after the German firm reported what Morgan Stanley called a substantial miss. Analysts see challenges reaching full-year guidance.
• Orsted shares drop as much as 4.7%, to the lowest since December 2016, after Berenberg analysts cut their rating on the stock to hold from buy.
• Siemens shares fall as much as 4.4% after the German industrial group reported a solid set of second-quarter earnings, with analysts noting continued improvement for the key Digital Industries division.
• CVC Capital shares fall as much as 3.2%, with analyst saying that the buyout firm’s fee paying AUM for the first quarter disappointed as some funds reached the end of their fee-paying periods.

Earlier in the session, Asian stocks slipped, poised to snap a four-day win streak, as the rally fueled in part by reduced fear over US tariffs fizzled. The MSCI Asia Pacific Index fell as much as 0.5%, with Toyota, and Sony among the biggest drags, as a stronger yen weighed on Japanese equities. Key gauges fell more than 1% each in Thailand and the Philippines. Tencent dipped despite upbeat earnings, weighing on key Hong Kong gauges, as investors await Alibaba’s results later Thursday. The market had been looking for major Chinese tech reports to provide the next catalyst. Despite the muted response to the US-China trade truce, some market watchers are turning more positive on Chinese stocks. Strategists at Goldman Sachs have raised their Chinese stocks index targets. Morgan Stanley said MSCI China’s onshore stocks saw “meaningful improvement” in the first quarter results over the previous three months, marking the first in-line outcome after 14 quarters of misses.

In FX, the Bloomberg Dollar Spot Index declines 0.3%.  The pound adds 0.2% with little reaction seen after UK GDP in the first quarter topped estimates as the period precedes a sharp rise in US tariffs.

In rates, treasuries are slightly richer across the curve with gains led by front end and belly, unwinding a portion of Wednesday’s selloff when Fed-policy pricing saw a hawkish shift. US yields are 2bp-3bp lower across maturities led by 5-year sector with 10-year near 4.51%. European government bonds also gain: bunds and gilts outperform, supporting Treasuries, following wave of European data including UK GDP and industrial production and French CPI. Slide in oil futures also supports Treasuries. US session includes April retail sales data and remarks by Fed Chair Powell on the central bank’s monetary policy framework review (text release expected at 8:40am New York time).

In commodities, WTI crude oil futures have pared a 4.2% drop to about 3.7%, extending losses for a second day after US President Trump said an agreement to curb Iran’s nuclear program is closer. Spot gold falls $11 to around $3,167/oz having pared an earlier fall.

US economic data calendar includes May Empire manufacturing, April retail sales, PPI, weekly jobless claims, May Philadelphia Fed business outlook (8:30am), April industrial production (9:15am), March business inventories, May NAHB housing market index (10am). Fed speaker slate includes Powell (8:40am) and Barr (2:05pm)

Market Snapshot

• S&P 500 mini -0.4%
• Nasdaq 100 mini -0.6%
• Russell 2000 mini -0.2%
• Stoxx Europe 600 -0.2%
• DAX -0.3%
• CAC 40 -0.2%
• 10-year Treasury yield -3 basis points at 4.5%
• VIX +0.6 points at 19.2
• Bloomberg Dollar Index -0.3% at 1229.3
• euro +0.3% at $1.1208
• WTI crude -4.1% at $60.55/barrel

Top Overnight News

• U.S. President Donald Trump said on Thursday that the United States was getting very close to securing a nuclear deal with Iran, and Tehran had "sort of" agreed to the terms. The agreement would see the country foreswear highly enriched uranium in exchange for an easing of economic sanctions. RTRS
• U.S. President Donald Trump said on Thursday that India had offered a trade deal that proposed "no tariffs" for American goods, while expressing his dissatisfaction with Apple's  plans to invest in India. New Delhi is seeking to clinch a trade deal with the U.S. within the 90-day pause announced by Trump on April 9 on tariff hikes for major trading partners. RTRS
• US officials seeking to negotiate trade deals around the world are not working to include currency policy pledges in the agreements, according to a person familiar with the matter. Foreign-exchange markets are on edge over concerns President Donald Trump’s administration is seeking a weaker greenback and might use trade bargaining to achieve that goal. BBG
• Trump asked Apple’s Tim Cook to stop plans to move iPhone output to India. The president said Apple will increase production in the US as a result of their discussion. BBG
• US authorities are preparing to announce one of the biggest cuts in banks’ capital requirements for more than a decade, marking the latest sign of deregulation agenda for the Trump administration. FT
• Trump says the US will upgrade the F-35 to an F-55; will do an F-22 super, an upgrade on the F-22.
• UnitedHealth shares dropped premarket after the WSJ reported it’s under criminal investigation for possible Medicare fraud. The company said it hasn’t been notified by the DOJ. BBG
• Japan's top trade negotiator, Ryosei Akazawa, could travel to Washington as soon as next week for a third round of trade talks with the U.S., two sources with knowledge of the plans told Reuters on Thursday. RTRS
• Ignoring Ukrainian President Volodymyr Zelensky’s call to meet for direct high-level talks in Turkey, Russian leader Vladimir Putin dispatched to Istanbul a team of junior officials, making it uncertain that negotiations between the warring nations would occur at all. WSJ
• Oil demand growth to slow according to the latest IEA report – “Global oil demand growth is projected to slow from 990 kb/d in 1Q25 to 650 kb/d for the remainder of the year as economic headwinds and record EV sales curb use.” IEA

Tariffs/Trade

• EU Trade Commissioner Sefcovic says the US and EU have agreed to intensify trade talk contacts.
• WTO chief warned that US bilateral tariff deals could put trade principles at risk and said global trade was in a crisis despite the recent de-escalation of the US-China tariff war, according to FT.
• US Treasury secretary Bessent says they can accomplish "a lot" over the next 90 days; will have a series of negotiations to prevent escalation with China again.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were predominantly lower following the mixed handover from Wall St, where the major indices were somewhat choppy and small caps underperformed as yields edged higher. ASX 200 traded indecisively but eventually eked mild gains in the aftermath of the stronger-than-expected jobs data from Australia. Nikkei 225 underperformed following recent currency strength and as earnings results remained in the spotlight in Japan. Hang Seng and Shanghai Comp were lacklustre amid little in the way of fresh catalysts to spur momentum, while Tencent shares traded indecisively post-earnings and Alibaba results are scheduled for release today.

Top Asian News

• Chinese President Xi hopes the Danish Chamber of Commerce in China and member companies will continue to role as a bridge between China and Denmark and between China and Europe, according to Xinhua.
• PBoC Governor Pan said China welcomes more outstanding Latin American market players to issue Panda bonds in China and share market development opportunities, while he added that China and Latin America should promote financial cooperation in a wider range of fields and a deeper level.

Subdued sentiment across Europe after the predominantly lower APAC handover, and following the mixed handover from Wall St, where the major indices were somewhat choppy and small caps underperformed as yields edged higher. Newsflow this morning has been light but earnings picked up, whilst current focus remains on geopolitical ongoings with US President Trump in the Middle East, consolatory language from Iran, and a likely no-show from Russia President Putin in Russia-Ukraine peace talks in Turkey. Sectors are mostly a defensive bias and in line with the cautious mood across the markets.

Top European News

• Plans for a reset of UK-EU relations hit trouble due to fishing rights and youth mobility as EU member states demanded further concessions from the UK, according to the FT.

FX

• DXY subdued and contained within Wednesday's confines amid a lack of fresh catalysts overnight, n a 100.58-101.05 range at the time of writing, within yesterday's 100.27-101.14 parameter.
• EUR ekes mild gains and trades on either side of the 1.1200 level after recent fluctuations, and with ECB speakers scheduled later, although data and speakers today are not likely to shift the dial much.
• GBP is slightly firmer following better-than-expected UK GDP data; GBP/USD resides within yesterday's 1.3250-1.3360 range.
• USD/JPY retreated overnight as the underperformance in Japanese stocks spurred some haven flows into the yen.
• Antipodeans are subdued in-fitting with the broader risk tone; mild support was seen in AUD/USD following the stronger-than-expected employment data from Australia.
• PBoC set USD/CNY mid-point at 7.1963 vs exp. 7.2217 (Prev. 7.1956).

Fixed Income

• Another contained start for fixed income with USTs marginally in the green while peers across the pond resided slightly in the red in the early morning.
• USTs at a 109-26 peak with gains of a handful of ticks. While firmer, the benchmark remains markedly shy of peaks from the last three sessions at 110-09+, 110-15 and 110-19+ respectively.
• Bunds find themselves attempting to make a footing above the break-even mark at the top-end of a 129.13 to 129.47 band.
• Gilts gapped higher by 17 ticks, before then slipping to a shortlived 91.02 low given the readacross from EGBs at the time. Currently, at the mid-point of a 91.02-22 band.
• UK sells (via tender) GBP 2.0bln 0.125% 2028 Gilt: b/c 3.52x, average yield 3.768% & tail 0.7bps

Commodities

• WTI and Brent are suffering losses of USD 2/bbl, with commentary surrounding Iran applying steady pressure overnight and through the morning so far. US President Trump said the US is getting close to a deal with Iran, and they are in serious peace negotiations, adding that Iran has "sort of" agreed to the terms of a deal. This constructive commentary surrounding the nation pushed benchmarks to fresh session lows, adding to overnight losses. Losses overnight also stemmed from geopolitics, following a report that Iran is ready to sign an agreement with certain conditions in exchange for the lifting of sanctions and would commit to never making nuclear weapons and getting rid of its stockpiles of highly enriched uranium. The aforementioned lows for WTI and Brent are currently USD 60.65 and 63.63/bbl.
• Spot Gold is extending on recent losses with demand subdued as it sits below the USD 3,200/oz mark. The trend seen for most of this week remains intact, with the metal continuing to be hit by higher yields, particularly on the short end.
• Copper Futures are lower by a percent, mostly owing to a downbeat risk sentiment in APAC hours. It currently trades towards session lows of USD 9,467/t, after being modestly pressured around the time of Trump commentary.
• IEA lifts 2025 average oil demand growth forecast by 20k BPD to 740k BPD on upward revision to GDP growth forecast and lower oil prices; sees global oil demand growth dropping to 650k BPD for remainder of 2025, from 990k BPD in Q1. “Increased trade uncertainty is expected to weigh on the world economy and by extension oil demand,”. IEA sees oil inventories rising by around 720k BPD in 2025 as global supply rises expected to considerably outpace demand growth. IEA hikes 2025 global supply growth forecast to 1.6mln BPD, up by 380k BPD from previous month's report on higher Saudi production outlook. IEA raises 2026 average oil demand growth forecast to 760k BPD (prev forecast 690k BPD).

Geopolitics: Ukraine

• Russian President Putin was not on a list of negotiators the Kremlin published for talks with Ukraine in Istanbul on Thursday
• Russian Kremlin spokesperson Peskov says no chance Russian President Putin will take part in Turkey talks, according to Ria.
• US President Trump says he will go to the Russia-Ukraine talks if appropriate.

Geopolitics: Middle East

• Qatar's PM said Israeli attacks in Gaza this week send a signal that they are not interested in negotiating a ceasefire, while he added that a US humanitarian plan for Gaza is not necessary and the UN should be allowed to deliver aid, according to CNN.
• Gaza Humanitarian Foundation announced it will launch operations in the Gaza Strip before the end of the month and stated that Israel has agreed to expand the number of distribution sites to serve the entire population of Gaza.
• US President Trump said Qatar is working with the US on negotiating an Iran deal and he wants to see Iran thrive.
• Iranian President Pezeshkian said Iran will not bow to any bullying from US President Trump who he suggested thinks that he can come to the region, chant slogans, and scare them.
• Iran is ready to sign an agreement with certain conditions in exchange for the lifting of sanctions and would commit to never making nuclear weapons, as well as getting rid of its stockpiles of highly enriched uranium, according to a top advisor to the Supreme Leader cited by NBC News.- US President Trump says the US getting close to doing a deal with Iran; in serious negotiations to achieve peace; don't want to take a second step and threaten Iran. Want to end Iran in an intelligent way, not destructive

Geopolitics: Other

• China's Hainan Maritime Safety Administration warned of military training taking place in an area of the South China Sea from May 15th to 16th and prohibited entry, while it noted there were some drills near Vietnam and China's Hainan.
• Russia sent a fighter jet to "check the situation" as Estonia was attempting to detain a Russian shadow fleet tanker, according to the Estonian Foreign Minister; jet violated NATO territory for "around a minute".

US Event Calendar

• 8:30 am: May Empire Manufacturing, est. -8, prior -8.1
• 8:30 am: Apr Retail Sales Advance MoM, est. 0%, prior 1.4%, revised 1.45%
• 8:30 am: Apr Retail Sales Ex Auto and Gas, est. 0.3%, prior 0.8%, revised 0.86%
• 8:30 am: Apr Retail Sales Ex Auto MoM, est. 0.3%, prior 0.5%, revised 0.56%
• 8:30 am: Apr PPI Final Demand MoM, est. 0.2%, prior -0.4%
• 8:30 am: Apr PPI Ex Food and Energy MoM, est. 0.3%, prior -0.1%
• 8:30 am: Apr PPI Final Demand YoY, est. 2.5%, prior 2.7%
• 8:30 am: Apr PPI Ex Food and Energy YoY, est. 3.1%, prior 3.3%
• 8:30 am: May 10 Initial Jobless Claims, est. 227.5k, prior 228k
• 8:30 am: May 3 Continuing Claims, est. 1890k, prior 1879k
• 8:30 am: May Philadelphia Fed Business Outlook, est. -11, prior -26.4
• 9:15 am: Apr Industrial Production MoM, est. 0.1%, prior -0.3%
• 9:15 am: Apr Capacity Utilization, est. 77.8%, prior 77.8%
• 10:00 am: Mar Business Inventories, est. 0.2%, prior 0.2%
• 10:00 am: May NAHB Housing Market Index, est. 40, prior 40

Central bank speakers

• 5:00 am: 2nd Thomas Laubach Research Conference
• 8:40 am: Fed’s Powell Speaks on Framework Review
• 2:05 pm: Fed’s Barr Gives Opening Remarks

DB's Jim Reid concludes the overnight wrap

The strong recent equity rally showed some signs of exhaustion over the past 24 hours, even though gains for the tech mega caps helped the S&P 500 (+0.10%) extend its gains since the closing low on April 7 to +18.26%. On the other hand, Treasuries came under renewed pressure with the 10yr yield (+7.1bps) closing above 4.5% for the first time since February as investors continued to price out Fed rate cuts and increased their focus on the US fiscal outlook. The moves added to the mixed performance across US asset classes since early April, with the S&P 500 now +3.91% above the pre-Liberation Day levels but 10yr Treasuries (+40bps) and the dollar index (-2.67%) having lost considerable ground.

Trump’s Middle East tour continued to generate headlines yesterday, but their market impact was narrower in comparison to Tuesday’s rally. One notable beneficiary was Nvidia (+4.16%), which moved back into the green YTD after the oil giant Saudi Aramco signed agreements of as much as $90bn with a slew of US companies, including with Nvidia on AI infrastructure. That helped the Magnificent 7 rise +1.75% on the day, while the NASDAQ was +0.72% higher. Elsewhere, more than $243bn of deals were announced during Trump’s visit to Qatar, with the White House saying this would lay the groundwork for a bigger $1.2trn economic pledge. This included a $96bn deal to buy up to 210 Boeing aircraft. Boeing’s shares closed +0.64% on the day, having been +3% intra-day after Trump announced the deal. The president is in the UAE today, so expect more announcements.

Outside of tech the equity mood was actually pretty weak, as the equal-weighted version of the S&P 500 (-0.62%) and the small-cap Russell 2000 (-0.88%) posted visible declines. This weaker performance was also visible in Europe as the STOXX 600 (-0.24%) ended its four-day winning streak, with the DAX (-0.47%) and CAC (-0.47%) leading the decline. Among the reasons for a stalling of the equity rally was a relative absence of trade headlines, although Bloomberg reported that India’s trade minister is set to visit the US this week to discuss tariffs.

With the recent surge driven by US-China trade discussions waning, Asian equity markets are also losing momentum this morning. Across the region, the Nikkei (-0.98%) is the biggest laggard, with the KOSPI (-0.43%) also in the red. In China, the CSI (-0.58%) and the Shanghai Composite (-0.42%) and Hang Seng (-0.25%) are moderately lower. The S&P/ASX 200 (+0.27%) is an exception in the region, trading higher. In the US, S&P 500 futures are -0.18% lower while those on the NASDAQ are near flat.

Yesterday’s more notable market milestones came for Treasuries, with 2yr (+5.1bps to 4.05%) and 10yr (+7.1bps to 4.54%) yields both closing at their highest levels since February. And the 30yr yield rose +6.7bps to 4.97%, its highest close since January and within touching distance of the 5% level it briefly breached on the evening of April 8, the night before Trump announced a 90 day delay to the reciprocal tariffs. So we are now reaching yield levels that previously seemed to trigger sensitivity from the US administration, though the recent moves are much more orderly than they were in early April.

The bond sell-off came amid an ongoing reversal in Fed rate cut expectations, with fed funds futures moving to price less than two cuts by year-end for the first time since February (-3.9bps to 49bps). That came as Fed speakers struck a measured tone, with San Francisco Fed President Daly saying that “the word of the day is patience” while Chicago Fed President Goolsbee said that a “solid hard data economy is still there” beneath the recent noise.

Meanwhile on the US fiscal side, the Republicans’ planned economic package continued to take shape, with the House Ways and Means Committee advancing the proposed tax portion that included an extension of 2017 tax cuts, eliminating taxes on tips and overtime pay and creating some new tax deductions, although some key issues such as the state and local tax deduction remain unresolved. The total of those planned tax cuts are well above the spending cuts that have been approved by other House Committees, so as things stands it looks improbable that the eventual package will deliver any meaningful reduction of the elevated US fiscal deficit.

The above rates moves come ahead of a slew of US data today, including the April PPI, where after Tuesday’s April CPI miss, we’ll be monitoring the categories that feed through into core PCE, while also watching for any evidence of tariff pass through into producer prices. Meanwhile, the April retail sales print will be watched for possible signs of pull-forward demand in response to tariffs, with April industrial production also due. Recall that while US sentiment surveys have seen a sharp weakening over the past few months, hard data have so far held up quite well.

The other notable market story yesterday were moves in the US dollar. The dollar index fell by as much as -0.72% intra-day following reporting that US and South Korea officials had discussed exchange rate policies at a meeting in early May. However, it recovered back to little changed (+0.04%) by the close following a Bloomberg report that US officials were not seeking currency pledges as part of ongoing trade negotiations. Still, there were notable gains against the dollar for the East Asian currencies, including the South Korean won (+0.88%) and Japanese yen (+0.50%). The won and yen are another +0.60% and +0.47% higher this morning. At a minimum, there is a sense that these countries may become more reticent to push back against their currencies appreciating than they have been in the past.

Turning back to Trump’s visit in the Middle East, yesterday the president said that Iran must “permanently and verifiably cease” its pursuit of nuclear weapons if it wanted to strike a deal with the US, while NBC reported that Iran is ready to sign an agreement with certain conditions. Brent crude was down -0.81% to $66.09/bbl on the back of ameliorating tensions, while gold fell -2.25% to $3,177/oz, leaving the precious metal on course for its biggest weekly decline since November.

Geopolitics will stay in focus today with Russia-Ukraine talks expected in Istanbul. The nature of any talks remains uncertain, with Ukraine’s President Zelensky calling for an in-person meeting with Russia’s Putin, but Moscow last night announcing a delegation headed by Vladimir Medinsky, a former Minister of Culture who led Russia’s talks with Ukraine back in 2022. Should the talks deliver little, a key question will be whether the US might join in announcing new sanctions against Russia which have been advocated by European leaders.

In terms of the day ahead, in the US we have the April PPI report, retail sales, industrial production, May Philadelphia Fed business outlook, Empire manufacturing index, initial jobless claims and more. We’ll also see the UK release its Q1 GDP numbers, with our UK economist expecting growth to have jumped in Q1 before reversing in Q2 (see preview here). Other data releases include March trade balances in Italy and the Eurozone. Central bank speakers include Fed’s Barkin, ECB’s Lane and BoE’s Lombardelli. The European Commission is also set to release their Spring Economic Forecasts.

By ReMix News

In many ways, Germany’s wind power revolution has been a success, with wind power serving as the country’s largest source of electricity. However, the current wind lull over the last three months has led to an extreme dip in energy production, which is costing firms millions in losses.

The wind speed average has dropped below less than 5.5 meters per second in the first quarter of 2025, according to German Meteorological Service (DWD). The last time the country saw such low speeds was in 1972 and 1973, and before that, in 1963.

Wind energy producers have been hit hard. For example, PNE, a wind farm operator in Coxhaven, showed revenue dropped to €27.9 million from €31.4 million the previous year, but perhaps more importantly, it went from an operating profit of €1.1 million in the first quarter to a loss of €7.1 million, according to Welt.

The company indicated that there was 31 percent less electricity generated nationwide in the first quarter of the year than in the same period last year, according to data from the German Energy and Water Industry Association (BDEW).

However, it should be noted that April 2024 and 2022 saw much higher wind speeds than previous years, so comparing 2024 to 2025 makes this drop look even more extreme. Experts say there is no evidence of climate change being at work, noting that previous decades have had similar lulls in wind speed.

Germany experienced so-called “dark lulls” over the winter, featuring little sunlight and low wind speed, which led to extremely high prices. Germany imported energy from neighboring countries and turned to conventional power plants in response.

Former Economic Minister Robert Habeck of the Greens had already planned to provide incentives to build 40 large gas-fired plants by 2030 to deal with fluctuations in wind and solar energy. These gas plants had a number of climate protections allegedly built in, such as being able to be switched to hydrogen at some point in the future.

The grid is also at risk due to renewable energy in some instances, especially during holidays when there is less power demand. Solar power cannot be regulated by grid operators, which means that when there is too much electricity and not enough sources that need it, the grid is pushed to its limit. The previous German government, at the urging of grid operators, implemented the PV Peak Act to deal with surplus solar power production.

The average share of solar power energy in 2023 was 31.5 percent, with coal-fired plants in second, at 22.5 percent.

Renewables make up an increasingly large share of Germany’s energy profile, which supporters say reduces reliance on foreign countries such as Russia while also reducing carbon emissions. Critics, on the other hand, say wind power has harmed energy security and also presents a number of environmental risks to wildlife and even forests.

However, it is not just countries like Germany turning to renewables. Conservative governments, including Hungary’s, are also increasingly shifting to wind and especially solar, where it is one of Europe’s leaders.