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Global fundraising in capital markets shrinks by $900bn in first quarter

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International fundraising in capital markets shrivelled by greater than $900bn within the first quarter from the identical interval in 2021 as surging inflation, conflict in Ukraine and unstable asset costs delayed inventory listings and hampered bond offers.

Companies raised $2.3tn within the first three months of the 12 months via fairness gross sales and new borrowings in bond and mortgage markets, the smallest sum in six years and down from greater than $3.2tn from a 12 months in the past, in line with information supplier Refinitiv.

Bankers and buyers say the drop-off in exercise stems from dramatic swings in world inventory markets and the beginning of interest-rate rises from the Federal Reserve, which has prompted cash managers to shrink back from riskier investments and high-flying shares.

“The onerous half and what has been scary about this quarter is the volatility,” mentioned Richard Zogheb, world head of debt capital markets at Citi. “When you might have fairness markets up quite a bit after which down quite a bit, it’s simply insane. There may be such uncertainty about the place issues are going.”

New inventory market debuts all however dried up within the US, with fewer than two dozen companies going public in a standard preliminary public providing thus far this 12 months. Globally, fairness gross sales have raised $131bn, about half the extent of final 12 months. That sum is roughly in step with exercise in 2019 and 2020, however it’s largely due to a string of huge listings in Asia, the place 9 of the 12 months’s 15 largest IPOs have launched. Within the US, inventory gross sales are on the lowest since 2009 within the depths of the monetary disaster.

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The 12 months’s blockbuster inventory market debut of LG Vitality Options in South Korea, which raised practically $11bn, dwarfs some other float thus far this 12 months. That features the $1.1bn raised by buyout store TPG Companions within the US and $1bn by Vaar Energi, one among Norway’s largest oil and gasoline producers.

Market volatility additionally pushed borrowing prices within the $10tn US company bond market larger, though corporations have nonetheless been capable of elevate wanted money.

Complete issuance of company bonds fell 7 per cent to $1.36tn, simply over $100bn wanting final 12 months’s ranges. The dip was led by a noticeable decline in borrowing from corporations that ranking businesses contemplate to be extra dangerous.

Some lenders backed away given the volatility, refusing to supply credit score or searching for larger borrowing prices once they may get snug with the dangers. Lending within the high-yield bond market globally fell 72 per cent to $59bn. Issuance within the US totalled simply $34bn for the primary quarter, down from $139bn a 12 months prior and the bottom first quarter tally since 2016, when an financial slowdown in China despatched shockwaves via world markets.

Yields on junk bonds, debt of lowly-rated company issuers, climbed from 4.3 per cent to over 6 per cent, largely because of rising benchmark rates of interest, moderately than a dramatic reassessment of the chance of lending to low-quality corporations.

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Some stability has crept in to fairness and company bond markets currently, whilst sovereign bonds — the spine of the worldwide monetary system — have continued to slip in worth. That has opened the door for some corporations, together with monetary know-how firm SS&C Applied sciences, to faucet buyers for capital after suspending deliberate borrowings earlier this 12 months.

“Corporations can’t anticipate ever,” mentioned Alexandra Barth, co-head of US leveraged finance at Deutsche Financial institution. “There’s a hope that we see some stability in Europe. There may be a capability to attend for a while however finally that persistence will dissipate and we’ll see extra offers which have to return to market. Finally corporations have to just accept that that is the brand new actuality.”

Bankers and buyers are ready for the IPO market to reopen within the US, with a number of — non-public corporations price at the very least $1bn — angling to go public. The latest volatility has prompted some buyers, together with Constancy and T Rowe Worth, to reduce their assumptions for what some non-public holdings are actually price. Earlier this month, grocery supply firm Instacart determined to chop its personal valuation by 40 per cent to $24bn in a brand new funding spherical.

Bar chart of Proceeds raised in the offering ($bn) showing Biggest IPOs of 2022

Though some corporations have delayed itemizing plans till the second half of the 12 months, many companies reminiscent of eyecare firm Bausch & Lomb have continued to replace paperwork with US securities regulators so they’re able to record rapidly when market situations enhance.

“The backlog is excessive and buyers have numerous capital to place to work,” mentioned David Ludwig, head of fairness capital markets at Goldman Sachs. “The mixture of these two issues means as soon as we see extra stability within the broader markets, [IPOs] might be welcome.”

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Viktor Orbán arrives in Kyiv on first wartime trip to Ukraine

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Viktor Orbán arrives in Kyiv on first wartime trip to Ukraine

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Hungary’s Prime Minister Viktor Orbán arrived in Kyiv on Tuesday, marking the first time since Moscow’s full-scale invasion of Ukraine that the EU’s most pro-Russian leader has visited the war-torn country.

Orbán, the EU and Nato’s most prominent critic of ongoing military aid to Kyiv, and one of the few western leaders to have met Russian President Vladimir Putin since the 2022 invasion, arrived a day after his country assumed the rotating presidency of the EU council.

Orbán will meet President Volodymyr Zelenskyy and other senior officials just days after the two spoke at an EU summit in Brussels, according to officials from both countries. They shared a private conversation before the Ukrainian urged all EU leaders to step up their military support to Kyiv.

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The leaders will deliver brief statements at the conclusion of their meeting in Kyiv but will not hold a press conference, according to a Ukrainian official close to Zelenskyy.

The Hungarian premier has regularly opposed financial aid to Ukraine and left the room during an EU leaders’ meeting in December in order not to vote against a decision to open accession negotiations with Ukraine — a significant milestone on the country’s path to becoming a full EU member.

Orbán’s government has also vetoed seven legal decisions backed by the EU’s other 26 member states that would release €6.6bn tied to weapons supplies to Ukraine. It prevented the start of formal EU accession talks between Kyiv and Brussels for much of the past 12 months, before lifting its block last month.

Budapest has justified its hardline position on Ukraine by claiming Kyiv is failing to meet its demands in guaranteeing the rights of the country’s Hungarian minority. The EU accession criteria include minority rights.

Almost all EU leaders except Orbán have visited Kyiv since Russia invaded Ukraine in February 2022. He is also one of only two — along with Austrian chancellor Karl Nehammer — to have met Putin in that time.

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At a conference in Budapest in December, the Hungarian prime minister said he had accepted an invitation from Zelenskyy to visit Kyiv but added: “I told him I’d be at his disposal. We just have to clarify one question: about what?”

Zelenskyy also invited Orbán to the Ukraine Peace Summit in Switzerland last month. Orbán declined but sent his foreign minister Péter Szijjártó.

In reaction to efforts to prevent Hungary from taking up the EU’s rotating presidency, Orbán has made a pledge to other leaders to be a responsible broker of EU legislation, according to people close to the talks.

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Four days since his disastrous debate, Biden hasn’t called top Democrats in Congress

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Four days since his disastrous debate, Biden hasn’t called top Democrats in Congress

WASHINGTON — Four days after his disastrous debate performance, President Joe Biden still hadn’t personally called top Democratic leaders on Capitol Hill to shore up support, five sources told NBC News, though White House chief of staff Jeff Zients was making calls.

Biden’s team has been working to quash questions swirling in the party about whether he can continue in the race against former President Donald Trump. Yet there’s growing frustration at the president’s inner circle for being overly “insulated,” said a Democratic lawmaker, who added that Biden isn’t doing the type of personal outreach they’d expect.

Biden hasn’t personally reached out to Senate Majority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries, both New York Democrats, or to other Hill leaders after his halting debate — a decision that has stunned some lawmakers.

“It’s troubling,” a House Democrat said, adding that the White House staff should be transparent — at least in private calls with lawmakers — about whether Biden’s struggles on the debate stage were a one-off or whether they have seen the problem before.

Schumer and Jeffries haven’t publicly expressed any disappointment at the outreach. Schumer’s office had no comment, while Jeffries’ office didn’t respond to questions.

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The Biden campaign didn’t comment specifically on Schumer and Jeffries but said Biden had talked with some elected officials.

“The president has spoken personally with multiple elected officials on the Hill and across the battlegrounds since the debate,” campaign spokesperson Lauren Hitt said.

Top White House officials have been in touch. Zients called Schumer and Jeffries after the debate, three sources said, and he has continued to trade calls with Schumer to discuss “staying aligned on next steps,” one of those sources said. Steve Ricchetti, counselor to the president, also was making calls to the Hill.

While Democratic lawmakers are all standing by Biden publicly, at least four told NBC News that they privately believe he needs to drop out now — four months before Election Day — to avoid a lopsided defeat for Democrats.

“It’s a very tough call. But because he will continue to decline, and because if he continues as our nominee we risk some catastrophic event after the convention that prohibits him from continuing as the nominee, he should step aside and allow for a nominating process at the convention in August,” said a Democratic lawmaker, who spoke on condition of anonymity to speak candidly.

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Asked whether Biden should gracefully bow out now, a moderate House Democrat replied, “yes,” adding that they still would like to see whether Biden’s approval drops precipitously in new polling after the debate.

Another Democratic lawmaker said colleagues will decide what to publicly say about Biden once they see the impact of the debate on House swing district polls. Democrats need to flip just a handful of seats to flip the House to Democratic control, while they face a tough map to hold on to the Senate.

“That has to be the firewall” against a potential Trump presidency, the lawmaker said.

Another House Democrat, this one a vulnerable moderate facing a tough re-election this fall, said they were still processing what happened last week and not yet calling on Biden to drop out of the race. But this lawmaker expressed anger and pointed the finger at the people around Biden 81, for letting him step on the debate stage.

“I hold his family and his advisers directly responsible for this mess,” the vulnerable lawmaker said in an interview. “They are closest to him, and they should have pulled him out before this happened.”

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The person added: “Just hoping someone above my pay grade figures this out.”

Rep. Annie Kuster, D-N.H., the chairwoman of the moderate New Democrat Coalition, also reiterated frustration with the Biden team’s handling of the debate and said Democrats need more information to assess “what happened” as they defend their seats.

“Obviously, we saw what we saw. We saw what 50 million Americans saw, and we have concern for the president’s well-being. We were disappointed and worried for him. … Many of us have been upset with his team of advisers that he was put in that situation,” Kuster said in an interview Monday.

“And I think we need to get a clear understanding of what happened, both in the debate preparation and during the debate. He’s obviously been much more energetic since then at the rallies,” Kuster said. “We all have a lot of concern for him. I hope he’s fine. And so the first stage is to assess what the impact is in these tough races.”

The Biden campaign, his political allies and top Democratic Hill leaders have chalked up Biden’s debate performance to a “bad night” and said he should be judged on his long list of legislative accomplishments and the fact that the alternative, Trump, is dangerous to the country. An energetic Biden acknowledged at a campaign rally Friday, “I don’t debate as well as I used to,” but he said he still plans to win in November.

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Many Biden allies and family members have spent the past several days circling the wagons, and some campaign aides and donors have argued that trying to nominate a replacement so late in the game could create an even worse scenario for the party.

“This magical thinking about the delegate selection process is people using mushrooms,” said Orin Kramer, a Biden fundraiser and a veteran of Jimmy Carter’s White House. “They have to get rid of the drugs and focus on the future of civilization. He’s been a great president.”

In an appearance on MSNBC over the weekend, Jeffries called Biden’s debate showing an “underwhelming performance” and said House Democrats would be having conversations by phone and virtually during the July Fourth recess about the path forward. But he said he was standing by Biden, whom he described as a “good man, an honorable man,” running against a “con man.”

Rep. Ro Khanna, D-Calif., a member of the Biden campaign’s national advisory board, told NBC News on Monday, “I support the president’s decision to stay and fight — the American people respect those with resilience and grit.”

But a Democratic lawmaker who has been in touch with members who face competitive races this fall described them as “scared.”

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“The ones that are in the worst position are front-liners in the swing states who already were feeling as though they had to carry the president … and then the catch-22 of trying to go out there and campaign. … It’s hard not to be panicky,” the lawmaker said. “It’s a lot of pressure. It’s a lot of anxiety.”

Rep. Jamie Raskin, D-Md., a Biden ally who led the team of impeachment prosecutors after Trump’s involvement in the Jan. 6 attack, acknowledged Sunday that “honest and serious conversations are taking place” in the Democratic Party about Biden’s political future.

Two Democratic officials in Washington said the way for Biden to recover would be to get out more in unscripted settings to prove the debate was simply an off night — getting on TV, doing interviews or town halls, holding news conferences.

That’s the “only way to fix it,” one of the Democrats said. “Got to get him out there.” The other said Monday it’s “damning” that four days after the debate, Biden still hasn’t held an event where he speaks without a teleprompter.

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US Supreme Court says Donald Trump immune for ‘official acts’ as president

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US Supreme Court says Donald Trump immune for ‘official acts’ as president

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The US Supreme Court has ruled that Donald Trump has broad immunity from criminal prosecution for his actions as president in a decision likely to delay his trial on charges of trying to overturn the 2020 election.

The landmark decision on Monday shields Trump for “official” acts. Lower courts will now have to draw the boundaries between a president’s personal and official acts.

The potentially time-consuming process reduces the likelihood of any verdict in the election interference case before November’s vote, in a win for Trump, the presumptive Republican nominee.

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If elected, Trump could instruct the DoJ to drop the case. In a social media post, he wrote: “BIG WIN FOR OUR CONSTITUTION AND DEMOCRACY. PROUD TO BE AN AMERICAN!”

The positive decision for Trump comes as the campaign of his opponent, President Joe Biden, reels from a disastrous performance at a debate between the candidates last week.

In a 6-3 vote, the Supreme Court held that a former president has absolute immunity from actions taken to exercise his “core constitutional powers” and “is entitled to at least presumptive immunity from prosecution for all his official acts”.

“The president enjoys no immunity for his unofficial acts, and not everything the president does is official. The president is not above the law,” Chief Justice John Roberts wrote for the majority. “But Congress may not criminalise the president’s conduct in carrying out the responsibilities of the executive branch under the constitution. And the system of separated powers designed by the framers has always demanded an energetic, independent executive.”

In a scathing dissent, Justice Sonia Sotomayor wrote that the majority’s decision “reshapes the institution of the presidency” and “makes a mockery of the principle, foundational to our constitution and system of government, that no man is above the law”.

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The court’s majority “invents immunity through brute force” and “in effect, completely insulate[s] presidents from criminal liability”, Sotomayor added. “With fear for our democracy, I dissent.”  

Biden later on Monday quoted Sotomayor, saying: “So should the American people dissent. I dissent.”

The decision “almost certainly means that there are virtually no limits on what a president can do”, Biden said. “This is a fundamentally new principle” and the court’s latest “attack” on a “wide range of long-established legal principles”. The ruling all but quashing chances of Trump facing trial before November was a “terrible disservice to the people in this nation”, he added.

Trump’s lawyers had argued for a broad interpretation of immunity, saying presidents may only be indicted if previously impeached and convicted by Congress for similar crimes — even in some of the most extreme circumstances — to allow them to do their jobs without fear of politically motivated prosecutions. The DoJ argued that doing so could embolden presidents to flout the law with impunity.

Roberts noted that lower courts had not determined which of Trump’s alleged conduct “should be categorised as official and which unofficial”. That process “raises multiple unprecedented and momentous questions about the powers of the president and the limits of his authority under the constitution”, he added.

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Trump’s discussions with the acting US attorney-general counted as an “official relationship”, for instance, but other incidents, such as Trump’s comments to the public as well as interactions with then vice-president Mike Pence or state officials, “present more difficult questions”, Roberts added.

The court had previously ruled on presidential immunity from civil liability, but this is the first time it has made a determination with respect to criminal cases.

A federal appeals court in February unanimously ruled that Trump was not entitled to immunity in the case. The Supreme Court decided later that month to hear Trump’s appeal, with oral arguments in late April, in effect bringing proceedings in the trial case to a halt for months.

Monday’s decision will not affect Trump’s criminal case in New York state court, where he was convicted of 34 felony counts of falsifying business records, in connection with “hush money” payments to porn actress Stormy Daniels in a bid to throw out damaging stories about him in the lead-up to the 2016 general election. Trump is set to be sentenced in that case on July 11.

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The former president has also been charged in Georgia state court in a racketeering case related to the 2020 election and in a separate federal indictment accusing him of mishandling classified documents. But these proceedings have yet to go to trial amid legal wrangling between Trump and US prosecutors.

A senior Biden campaign adviser said the ruling “doesn’t change the facts, so let’s be very clear about what happened on January 6: Donald Trump snapped after he lost the 2020 election and encouraged a mob to overthrow the results of a free and fair election”.

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