Ceasefire holds

Good morning. Oil prices calm as the fragile US-Iran ceasefire holds. Apple considers plans to produce more chips in the US. And temporary art is the new norm. Listen to the day’s top stories.

— Tiago Ramos Alfaro

The fragile US-Iran ceasefire is holding even after a day of clashes involving shipping in the Strait of Hormuz. Hundreds of ships were seen clustering near Dubai as more vessels moved away from the still-empty waterway in response to Iran’s efforts to widen its area of control. Watch Bloomberg TV explain the latest flareup of violence. As for oil prices, they edged lower, settling after yesterday’s sharp spike.

Apple’s branching out. It’s said to have held exploratory talks about using Intel and Samsung to produce the main processors for its devices in the US. As far back as 2022, CEO Tim Cook was worrying about relying so heavily on supply from its long-term partner Taiwan Semiconductor Manufacturing Co. and it’s been working on solutions including a made-in-US chips push in Phoenix.

The tech giant is also is preparing a new “Create a Pass” feature for its next major iPhone software update, people familiar said. The new tool will allow users to build and customize their own digital tickets and gift cards within the Wallet app, and adds to a string of enhancements set to be unveiled in June.

In other corporate news, GameStop’s bold $56 billion bid for eBay is drawing serious skepticism from investors. Michael Burry—who helped fuel the gaming retailer’s rally in 2019—sold off all his shares, calling the strategy “never compatible.” And Elon Musk agreed to pay $1.5 million to settle Securities and Exchange Commission allegations that he cheated Twitter shareholders in 2022 by failing to properly disclose his growing stake.

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Deep Dive: Drowning in Debt

Brazil’s stock-market boom is masking a painful credit squeeze: millions of smaller firms are falling behind as high rates turn their pandemic borrowing binge into a debt hangover.

• A record-matching 8.9 million companies have delinquent debt, totaling about $43 billion, with smaller businesses hit hardest.
• Big names including Kora Saúde, Raízen and GPA have sought restructuring as floating-rate debt becomes harder to roll over and signs of woe pile up in the bond market.
• New doubts that interest-rate cuts will come fast enough are raising concern that defaults, already at record levels, will continue rising and take a bite out of profit at banks and fintechs.
• President Lula da Silva is trying to shield households from spillovers, including a program to renegotiate debt, but economists warn rate cuts may still not be enough.

The Big Take

A divided Europe is losing ground in the global crypto race. It’s pushing forward a digital euro in a bid to fight back, but the crypto-powered dollar is winning anyway.

Big Take Podcast

As Jet Fuel Soars, Airlines Race to Adapt

Opinion

Photographer: Julien de Rosa/AFP

The risk of a restart in the Iran war is irrationally high, Marc Champion writes. Overconfidence in both Washington and Tehran makes a resumption of a war born of hubris just one further mistake away.

More Opinions

John Authers

Iran Draws a Line and Puts Markets on Notice

Liam Denning

Big Oil and the White House Face a Pump Price Reckoning

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Before You Go

Source: Alamy

Public art is increasingly temporary, with artists favoring spectacle and virality over permanence, a shift pioneered by Christo and Jeanne-Claude’s wrapped Pont Neuf back in 1985. Over 40 year later, French artist JR is set to revisit the famed bridge with plans to turn it into a rocky cave.

One More

How One Calf Shows Why Record Beef Prices Still Aren’t Coming Down

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