WOLF - Wall Street Breakfast Podcast: Chaos In Russia

2023-06-26 06:57:58 ET

Summary

• Russia's Wagner group of mercenaries briefly seized the city of Rostov, demanding the removal of Russian military commanders in charge of the war in Ukraine, before backing down and returning to Ukraine.
• IBM is reportedly close to acquiring software provider Apptio for $5 billion.
• While semiconductor maker Wolfspeed Inc. is set to receive up to $2 billion in debt financing for its U.S. expansion.

Listen on the go! Subscribe to Wall Street Breakfast on Apple Podcasts and Spotify Putin vs. Wagner: What does chaos in Russia mean for the markets? (00:24) IBM ( IBM ) nears $5B acquisition of software provider Apptio - report (01:29). Wolfspeed ( WOLF ) to get $2B in debt funding from Apollo-led group - reports (01:57).

This is an abridged transcript of the podcast.

Russia's Wagner group of mercenaries made a short-lived rebellion on Saturday.

They seized the southern city of Rostov and was only 120 miles from Moscow when the revolt was called off.

They were demanding the removal of Russian military commanders in charge of the war in Ukraine. But then the army backed down and headed back to Ukraine.

Under terms of an agreement to end the crisis, Wagner’s 25,000 heavily armed troops won't face prosecution, while their leader, Yevgeny Prigozhin, was exiled to Belarus.

The rebellion lasted more than a day.

The consequences from this for the war and to Vladimir Putin's authority are still to be played out.

Markets are looking at the situation as a non-event for now , but traders are on edge should things morph into something bigger - like a full-out coup, uprising or even a civil war. Energy is likely the biggest sector that would be impacted.

If you’re looking for a deeper dive into this report. You’ll find it in the Wall Street Breakfast newsletter .

IBM (NYSE: IBM ) is close to a deal to acquire software provider Apptio for $5 billion.

The Wall Street Journal had reported that the companies were in advanced talks for a deal that could be completed over the weekend. Private equity firm Vista Equity Partners owns Apptio. It's not clear whether the acquisition price includes debt.

Vista agreed to acquire Apptio for $1.94 billion in 2018.

Semiconductor maker Wolfspeed Inc. (NYSE: WOLF ) is receiving as much as $2 billion in debt financing.

The funds will be used for its U.S. expansion and is coming from a group of lenders led by private equity firm Apollo Global ( APO ).

According to a Bloomberg report on Sunday, which cited a statement, the financing includes $1.25 billion in cash immediately available to Wolfspeed ( WOLF ), with another $750 million that can be drawn later . News of the financing was first reported by The Information.

The financing is structured as 7-year secured notes that carry a coupon of 9.875% that can be paid back after three years.

Other headlines to look out for on Seeking Alpha:

E-cigarette sales increased by nearly 50% between 2020 and 2022

Apple expands self service repair to include iPhone 14 line, Macs

Oregon county sues Big Oil companies for $51B over role in 2021 heat dome

Looking ahead to 2023's back half for investing opportunities

OPEC sees global oil demand growing 23% by 2045 - report

Consumer stocks are in the spotlight with student loan repayments and food disinflation in the mix

On our catalyst watch for the day, Notable companies due to report include Carnival ( CCL ). The cruise line stock has been tipped by some analysts to raise full-year guidance. Options trading implies a double-digit swing for Carnival after the earnings report hits.

And the four-day Snowflake ( SNOW ) Summit 2023 is expected to give investors a deeper look at the company's latest innovations, use cases, and thought leadership. The summit will include a fireside chat on generative AI with Nvidia’s ( NVDA ) CEO.

U.S. stocks slipped on Friday, with Wall Street's benchmark gauge notching its worst week since early March.

The Nasdaq ( COMP.IND ) retreated 1%. The S&P 500 ( SP500 ) closed 0.8% lower. The Dow ( DJI ) fell 0.6%.

On a weekly basis, the S&P was down 1.4%, the Nasdaq was down 1.4% while the Dow was down 1.7%.

All 11 S&P sectors lost ground on Friday, led by Utilities and Consumer Discretionary.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the red. The Dow is down 0.2%, the S&P 500 is down 0.15% and the Nasdaq is down 0.2%. Crude oil is up 0.3% at more than $69 a barrel. Bitcoin is down 1.3% and is still above 30,000.

In the world markets, the FTSE 100 is down 0.2% and the DAX is down 0.2%.

On today’s economic calendar, at 1030am the Dallas Fed manufacturing survey.

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