1.Global Semiconductor Sales Plunge After Stocks Make New High.

Did Someone Turn Off the Spigot? Global Semiconductor Sales Plunge Most Since the Financial Crisis

by Wolf Richter • Apr 30, 2019 • 73 Comments • Email to a friend

According to chip makers, the plunge isn’t over yet. Now hoping it won’t turn into the mess as in 2001 when the last tech bubble became the dotcom bust.

Global semiconductor sales dropped 15.5% in the first quarter, from the fourth quarter last year, to $96.8 billion, the World Semiconductor Trade Statistics (WSTS) organization reported Monday afternoon. The three-month moving average in March has now plunged 25% from the three-month moving average at the peak last October, the deepest plunge since the Financial Crisis:

Demand was down across all regional markets: The global 15.5% drop in sales from Q4 2018 to Q1 2019 split up regionally this way – and the problem isn’t just China:

• Americas: -29.2%
• China: -14.5%
• Japan: -13.8%
• Asia Pacific/All Other: -10.4%
• Europe: -3.1%

https://wolfstreet.com/2019/04/30/did-someone-turn-off-the-spigot-global-semiconductor-sales-plunge-most-since-the-financial-crisis/

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1.WeWork IPO…Second Biggest Offering of the Year….$1.9B in Losses Last Year.

The co-working company told employees yesterday that it has confidentially filed paperwork with the SEC to go public.

WeWork reportedly hasn’t picked bankers yet, and an offering wouldn’t happen until the third or fourth quarter of this year. But there’s more you should know about 2019’s latest mega-offering.

It’s as meaty as a WeWork company card will allow

A WeWork IPO would likely be the second-biggest offering in the U.S. this year behind Uber. WeWork was last valued at $47 billion and has 400,000 members in 100 cities.

• Still, it’s burning through cash. Though WeWork’s revenue doubled last year to $1.8 billion, its losses more than doubled to $1.9 billion.

It’s not just WeWork

It’s the We Company after a rebranding earlier this year to focus on more than just the short-term office space rental service that (along with its notorious tenant Morning Brew) made it famous. Now, it’s diversified into businesses like housing, a children’s school, and a coding academy.

Wherefore the rebrand? Fend off skepticism over WeWork’s ability to withstand a market downturn, when fewer D2C birdseed startups will look for low-commitment office space. But we may always need apartments for “modern-day nomads.”

And speaking of skeptics…there are plenty. WeWork is a “love it or hate it” company, writes Axios. A “person close to the company” told Axios WeWork could become the second-most shorted stock after Tesla.

But as for believers…

WeWork is no mere co-working company. It serves a higher purpose.

From CEO Adam Neumann: “As one of the world’s largest physical networks, it is our responsibility to help lead the way and set the global example for people and corporations on how we should take care of each other and of our planet.”

https://www.morningbrew.com/

https://www.bloomberg.com/news/articles/2019-01-07/wework-bonds-trade-like-ccc-on-softbank-adding-to-rating-puzzle

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1.Muni’s Have Record 4 Months of Inflows.

Boom, Another Billion’: Muni Funds Land a Year’s Worth of Cash in Four Months

By Danielle Moran

Funds have already seen $30 billion inflow, analyst says

Bid to drive down tax bills pushes munis to pricey levels

It’s only four months into 2019, and already mutual funds that invest in state and local-government debt have raked in more cash than they usually do in a year.

Investors added $1.1 billion to such funds in the week ended April 17, the fifteenth straight weekly influx, the Investment Company Institute reported Wednesday. That bumped the total to about $30 billion since January, more than they’ve drawn during any full year since 2012, according to an analysis of the data by CreditSights.

source

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1.U.S. Dollar Big Move Up in April….U.S. Rates Still the Highest in World.

Equities

The stock rally paused on Wednesday, pressured by the rising US dollar. Outside of the trade-related uncertainties, the dollar now poses the highest risk to equities. A firmer dollar tends to make US products more expensive for customers abroad and depreciates the value of foreign earnings for US companies. Imported products in the US become cheaper, making it harder for domestic firms to compete.

Weak economic data out of Germany (see the Eurozone section) and a more dovish Bank of Canada (Canada section) boosted the dollar on Wednesday. Rate differentials with other economies will provide tailwinds for the dollar over the long run.

Source: Morgan Stanley Research

The Daily Shot
https://blogs.wsj.com/dailyshot/2019/04/25/the-daily-shot-a-stronger-dollar-could-hinder-the-market-rally/

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