Wall Street Breakfast: Antitrust Dismissed (For Now)

Antitrust dismissed (for now) - Thinking of putting in a bid for Facebook (FB)? You better have deep pockets. Like, $1T deep. The social networking giant climbed above a $1T valuation on Monday, as a federal judge took the company's side in an antitrust suit. The dismissal marks a big blow to the state and federal movement against Big Tech, which has cited alleged abuses in the corporate giants' massive market power.Backdrop: The Federal Trade Commission sued the company last December, along with attorneys general from 48 states, saying Facebook had employed a systematic strategy to eliminate threats to its monopoly. Those included the 2012 and 2014 acquisitions of Instagram and WhatsApp, which - mind you - the FTC previously cleared. The agency and states were seeking a forced divestiture of the social services, as well as other remedies.Judge James Boasberg dismissed the FTC's case as too vague, but gave the agency a chance to amend its complaint with more clarity (it has until July 29). As for the states, the judge said the attacks on Facebook's acquisitions are "barred by the doctrine of laches, which precludes relief for those who sleep on their rights." He also ruled that the states' challenge to Facebook's policy of preventing interoperability with competing apps "failed to state a claim under current antitrust law, as there is nothing unlawful about having such a policy."Outlook: The antitrust efforts are not stopping here. The White House is said to be developing an executive order that will ask government agencies to consider antitrust concerns in decision making, following news earlier this month of a five-bill package of bipartisan legislation seeking to rein in Big Tech. Last week, new Federal Trade Commission Chairperson and Big Tech critic Lina Khan also reportedly named three top staffers, which are likely to get more aggressive on antitrust policy. (89 comments)

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Top News Antitrust dismissed (for now) Shutterstock Thinking of putting in a bid for Facebook (FB)? You better have deep pockets. Like, $1T deep. The social networking giant climbed above a $1T valuation on Monday, as a federal judge took the company's side in an antitrust suit. The dismissal marks a big blow to the state and federal movement against Big Tech, which has cited alleged abuses in the corporate giants' massive market power. Backdrop: The Federal Trade Commission sued the company last December, along with attorneys general from 48 states, saying Facebook had employed a systematic strategy to eliminate threats to its monopoly. Those included the 2012 and 2014 acquisitions of Instagram and WhatsApp, which - mind you - the FTC previously cleared. The agency and states were seeking a forced divestiture of the social services, as well as other remedies. Judge James Boasberg dismissed the FTC's case as too vague, but gave the agency a chance to amend its complaint with more clarity (it has until July 29). As for the states, the judge said the attacks on Facebook's acquisitions are "barred by the doctrine of laches, which precludes relief for those who sleep on their rights." He also ruled that the states' challenge to Facebook's policy of preventing interoperability with competing apps "failed to state a claim under current antitrust law, as there is nothing unlawful about having such a policy." Outlook: The antitrust efforts are not stopping here. The White House is said to be developing an executive order that will ask government agencies to consider antitrust concerns in decision making, following news earlier this month of a five-bill package of bipartisan legislation seeking to rein in Big Tech. Last week, new Federal Trade Commission Chairperson and Big Tech critic Lina Khan also reportedly named three top staffers, which are likely to get more aggressive on antitrust policy. (89 comments)       Stocks Reconsidering reflation Big Tech and growth stocks led the market higher on Monday as the reflation trade took a backseat. Traders are now wondering if that will be the case going forward after the Fed caught some off-guard two weeks ago when it projected earlier rate hikes than it had previously forecast. Overnight, stock futures inched between gains and losses, though the major averages are still holding near record highs. Hedge funds that bet big on the reflation trade, like Caxton Associates, did experience some losses following the Fed's announcement on June 16 (its $2B Macro fund is down 8% since the meeting). Investors are also reassessing how to think of inflation and the growth outlook if the FOMC is open to pivoting on its monetary policy. The central bank previously signaled it would look past rapidly rising consumer prices, before opening the door to two interest rate hikes in 2023. Sticking to their guns: "Nothing in our view has changed. We are all in on the reflation trade," said Bob Michele, chief investment officer at JPMorgan Asset Management. "We think there is a lot of growth and inflationary pressures that are building in the economy... [and] we are only halfway through the reopening domestically." New chapter: "The breakout to new highs in Growth was the catalyst to push the S&P 500 to new highs," noted JC O'Hara, chief market technician at MKM Partners. "We see the situation where Growth may continue to outperform Value in the weeks ahead." Consumer confidence: Fresh figures from The Conference Board will be published this morning and could signal how much optimism Americans have about economic conditions. That could help gauge their readiness to spend on goods and services, as well as the stock market's direction. Economists have forecast the Consumer Confidence Index will tick higher in June after holding relatively steady since February.       Sponsored By Unifimoney Get up to a $5,000 Bitcoin Reward with Unifimoney Robo Advisor, Commission Free Trading of thousands of stocks and ETF's, trade over 30 Cryptocurrencies and Precious Metals. Unifimoney is a multi-asset investment and money management platform that makes building and protecting your wealth effortless. The only fully integrated digital consumer financial solution in the market. You don't need multiple apps to manage your investing and money. Get the manual work done for you with automated investing and make your own trades when you want across both traditional and alternative assets in one app. Open an account and claim your Bitcoin Reward now Events Record heat There are some crazy temperatures being felt across the U.S. Pacific Northwest, triggering some power outages and more wildfires. The extreme weather is also threatening more vulnerable populations like the elderly and homeless, as well as those without air conditioning. Only about 44% households in Seattle have AC, according to the U.S. Census Bureau, as the climate there is usually temperate (highs in June average 71 degrees). New records: The extreme temperatures began at the weekend, with mercury in the Emerald City hitting an all-time high of 108 degrees Fahrenheit on Monday. According to the National Weather Service, it was also the first time Seattle topped 100 degrees for multiple days in a row. Meanwhile, temperatures in Portland, Oregon, soared to 116 F, while the heat wave is now moving into Idaho, where temperatures above 100 are forecast in Boise for the next week. The severe weather comes about a week after record temperatures hit parts of the Great Plains to coastal California, which exacerbated an existing drought situation. The scorching conditions were caused by an extended "heat dome" that traps hot ocean air over a certain area and blocks the jet stream. Meteorologists warn that extreme weather is becoming more common, while scientists are still researching the differences, connections and to what levels these patterns are linked to human-generated behavior and longer-term climate patterns.

Prime chilling: The record-breaking heat wave has prompted Amazon (NASDAQ:AMZN) to turn part of its Seattle headquarters into a "public cooling center." The facility is located at the Amazon Meeting Center, which is part of the company's South Lake Union campus and has room for up to 1,000 individuals. Earlier this year, the same site was converted into a pop-up clinic to administer COVID-19 jabs, assisting with the broader U.S. vaccine rollout.

     

Trending

New space race

The battle for space is heating up among the world's most popular billionaires, with Sir Richard Branson's Virgin Galactic (NYSE:SPCE) receiving FAA clearance last week to fly paying customers into the thermosphere. The stock has been on a tear since the approval on Friday, with many traders and the WallStreetBets crew banding together for the rocket ride. In fact, shares are up a total of 36% to $54 over the last three sessions and are 250% higher than their May low.

Cue the Star Wars soundtrack: Rumor has it that Branson could make it to space before rival Jeff Bezos blasts off in his Blue Origin (BORGN) rocket on July 20. UBS even sees an incremental positive for Galactic if the company flies Branson on its next test flight, saying it could be a catalyst for a faster opening of the company's sales campaigns. "I think part of how they're shaping the competition is by putting themselves on the line as part of the face of the competition," said Victoria Samson of the Secure World Foundation.

The two companies will get people to suborbital space in different ways. Galactic uses a carrier aircraft to fly its space plane high above Earth, while Blue Origin uses a rocket-launched capsule (it's also looking to diversify its business by sending payloads into orbit via New Glenn). "In general, every mission that goes up, every rocket that's launched, every bit of progress we make does drive down costs, makes space more affordable [and] accessible to everybody," added Shift4 Payments' Jared Isaacman, who is partnering with SpaceX (SPACE) to lead the first all-civilian mission into orbit later this year.

Go deeper: Taking ownership of the heavens is not only limited to space travel and tourism, but also the infrastructure that could change how we operate on Earth. Today, Elon Musk will take the virtual podium at the Mobile World Congress in Barcelona to discuss progress on Starlink's (STRLK) global connectivity plan. The SpaceX subsidiary is hoping to avoid the fate of similar satellite ventures that preceded it (i.e. bankruptcy) after launching its "Better Than Nothing Beta program" in the U.S. last October. While data speeds have been advertised at 150 megabits per second, some users have complained of connectivity and reliability issues that have long plagued satellite internet. (2 comments)

     

Today's Markets

In Asia, Japan -0.8%. Hong Kong -1.1%. China -0.9%. India -0.4%.
In Europe, at midday, London +0.2%. Paris +0.4%. Frankfurt +0.9%.
Futures at 6:20, Dow +0.1%. S&P flat. Nasdaq -0.1%. Crude -0.5% at $72.56. Gold -0.6% at $1770.50. Bitcoin +3.5% at $35323.
Ten-year Treasury Yield flat at 1.48%

Today's Economic Calendar

8:55 Redbook Chain Store Sales
9:00 Fed's Barkin Speech
9:00 S&P CoreLogic Case-Shiller Home Price Index
9:00 FHFA House Price Index
10:00 Consumer Confidence

Companies reporting earnings today »

What else is happening...

United (NASDAQ:UAL) announces largest order in the airline's history.

Nations impose new restrictions to curb Delta variant.

Wells Fargo (NYSE:WFC) plans big buybacks, to double dividend.

Cathie Wood's ARK Invest to help launch a Bitcoin ETF.

Meme favorite AMC (NYSE:AMC) finds itself back in the headlines.

Etsy (NASDAQ:ETSY) jumps on deal to acquire Brazil's Elo7.

Solar stocks rally to two-month high as restriction fears ease.

Juul (JUUL) agrees to pay $40M in North Carolina vaping settlement.

FAA tells Boeing (BA) its 777X is not ready for certification.

EV upstart Electric Last Mile Solutions (NASDAQ:ELMS) pops on Nasdaq debut.

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