Business

By Dietrich Knauth

June 12 (Reuters) – A U.S. bankruptcy judge in Houston said on Friday bankrupt auto parts maker First Brands could move ahead with a liquidation plan that would fund lawsuits against the company’s indicted founder and other insiders in an attempt to recoup money for creditors.

U.S. Bankruptcy Judge Christopher Lopez allowed First Brands to solicit votes on its preferred proposal for winding down its business, rejecting demands from a government watchdog and some creditors who asked the judge to convert the case to a quicker and more straightforward Chapter 7 liquidation that would be managed by a court-appointed trustee. 

Lopez said First Brands deserves a chance to see if its creditors will support its litigation strategy, and he will consider approving the wind-down plan at a court hearing in July.

First Brands collapsed into bankruptcy in September after its lenders began investigating allegations that the company fraudulently double-pledged its assets as collateral on multiple loans.

First Brands failed to reorganize in bankruptcy, leaving it unable to repay more than $11 billion in debts. After the company went bankrupt, its founder Patrick James and his brother Edward James were indicted on federal fraud charges.

First Brands’ collapse caused losses for some of the largest investment firms on Wall Street and sparked concerns about fund managers’ exposure to troubled borrowers in the opaque markets for private credit. 

First Brands’ financial state has only worsened in the months since it filed for bankruptcy, and its lenders stand to take losses even on the additional $1.1 billion in new money that they provided at the start of First Brands’ bankruptcy. 

That money ran out in January, forcing First Brands to rely on prepayments from key parts buyers like Ford and GM. First Brands sought to find a buyer for the whole company but was able to sell only a few business lines to generate a fraction of the amount it borrowed under the bankruptcy loan. First Brands sold its Horizon towing business for $64 million, its Toledo Molding & Die business for $80 million and its Walbro business for $50 million.  

First Brands does not have enough money to repay debts racked up after its bankruptcy filing, which are typically treated as “administrative expenses” that must be repaid before all other debts. 

The Office of the U.S. Trustee, which acts as the U.S. Justice Department’s bankruptcy watchdog, said in court filings that First Brands is $223 million behind on administrative expenses, including debts to vendors who shipped parts to First Brands after it filed for bankruptcy.

First Brands’ bankruptcy plan, if approved at the July court hearing, would set up a litigation trust to pursue lawsuits in hopes of raising additional money for creditors. 

The trust would be funded with at least $75 million to start filing lawsuits, including $25 million in First Brands’ existing cash and $50 million in additional litigation funding supplied by the same lenders who provided the $1.1 billion bankruptcy loan. The litigation would target James and others who allegedly took money out of the business in the months before it went bankrupt.

(Reporting by Dietrich Knauth; Editing by Alexia Garamfalvi and Will Dunham)

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LONDON, June 12 (Reuters) – Senior executives in the private markets sector pointed to weaker incomes and challenges raising money at the industry’s largest annual conference in Berlin this week, while consultancy Bain & Co said private equity is in a prolonged “liquidity crunch”.

Nicolas Brugere, a partner at Swedish buyout firm EQT, said limited partners – the institutional investors that provide capital – wanted to see money returning in order to reinvest and that the industry is concentrating.

“Investors want fewer relationships and they value scale,” he said at the conference.

Matt Theodorakis, a partner at Ares Management, one of the world’s largest private credit managers, pointed to a slowdown in inflows and capital retrenchment.

“What we see in our investment committee, which is over the last three to six months, is that money subsided,” he said on a panel, highlighting how the slowdown in distributions is rippling across markets, from buyouts to credit.

Bain’s report said a growing number of companies were stuck in portfolios, as a combination of falling software valuations, uncertainty around the Iran war and stress in private credit markets cools dealmaking, fundraising and exits.

Private equity firms now hold assets for around seven years on average, beyond the traditional three to five years, Bain said, while the backlog of unsold companies has climbed to about 33,000.

A Reuters analysis of regulatory filings showed dividends at U.S.-listed private-credit lenders rest on thinner cash cushions than headline earnings suggest, raising risks for investors drawn to the sector’s high yields.

Median dividend coverage across 46 business development companies (BDCs) slipped to 0.99 times in the first quarter of 2026, meaning reported net investment income no longer fully covered regular and supplemental payouts.

Excluding payment-in-kind interest, which allows borrowers to defer interest payments by adding them to their loan balances, median coverage fell to 0.89 times.

Second-quarter redemptions continued. A $25 billion BlackRock private credit fund received requests to redeem 13.3% of the value of its assets in the first quarter, and will buy back 5%, the world’s largest asset manager said on Friday.

Redemption windows at key U.S. non-traded BDCs began closing last month, with market participants watching the rate of withdrawal requests.

J.P. Morgan analyst Kabir Caprihan released a survey showing roughly 85% of investors believe total second-quarter redemption requests across non-traded U.S. business development companies will be greater than in the first quarter.

(Compiled by Vidya Ranganathan; Editing by Paul Simao)

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By Dawn Kopecki and Akash Sriram

NEW YORK, June 12 (Reuters) – The first day of SpaceX trading is over. Now, the parties begin.

At the “Top of the House” of JPMorgan’s $4 billion headquarters in midtown Manhattan on Friday, CEO Jamie Dimon will serve moon pies, space ice cream and custom cloud candy to SpaceX COO Gwynne Shotwell, CFO Brett Johnsen and 250 of the rocket maker’s employees to celebrate the company’s record-shattering, historic IPO, according to a person familiar with the festivities.

Downtown, in the heart of New York’s financial district, a group of venture capital investors were hosting a $30,000 rooftop party for 30 with A5 Wagyu beef sliders, Don Julio tequila, Macallan 18-year Scotch and Dom Pérignon champagne, a person familiar with that party’s preparations said. The ice cubes for the cocktails, this person said, have the company’s stylized “X” logo stamped into the ice. 

The SpaceX IPO minted a fresh class of millionaires, paid banks hundreds of millions in fees, added billions in profits to early institutional investors and turned founder Elon Musk into the world’s first trillionaire. The festivities unfolded against a backdrop of slowing consumer spending and renewed concerns about inflation, underscoring the gap between Wall Street’s enthusiasm and Main Street’s unease about the economy. 

At least 4,000 current and former SpaceX employees alone held equity stakes worth more than $1 million at the time of the IPO, according to estimates from Hill.com, a platform that facilitates trading in shares of private companies. Another 400 employees held stakes worth more than $100 million, it said. 

“He (Musk) has long been reaching for the stars with his extra-terrestrial ambitions, and it appears plenty of investors share his enthusiasm for the future,” said Susannah Streeter, chief investment strategist at Wealth Club. 

GREEN SNEAKERS

The Nasdaq stock exchange, which won the listing, broadcast a 120-foot image of Musk standing at the opening bell ceremony across its big screen in Times Square. Musk posted a photo on X of Morgan Stanley’s banking team, including CEO Ted Pick, co-president Dan Simkowitz and star technology banker Michael Grimes wearing matching green sneakers, nodding to the bank’s need to exercise the “greenshoe” option that allocates extra shares in case of extraordinary investor demand. 

Banks involved in the IPO, which stand to make some $500 million in fees, have been hosting investor events and parties all week, people familiar with the festivities said.

At Goldman Sachs’s headquarters downtown, Co-Head of Global Banking Dan Dees hosted Johnsen and other SpaceX executives for a celebration after the IPO priced Thursday night, according to a person familiar with the event.

CEO David Solomon took to social media Friday to congratulate Musk and his team, saying how honored the bank was to serve as the “lead left bookrunner” on the deal, named for its placement on the company’s registration statement indicating its role as the lead underwriter.

SpaceX designs adorned party favors across town. Visitors at Goldman on Friday received asteroid-shaped macaroons. JPMorgan is lighting up the top of its 1,388-foot (423-meter) Park Avenue headquarters with SpaceX rocket launches to mark the bank’s collaboration with the company. 

JPMorgan’s equities team rang their own bell on its trading floor when SpaceX hit the market before cutting into a custom made rocket cake for the team. 

JPMorgan’s fête Friday night promises to be the biggest SpaceX celebration on Wall Street – an idea Dimon directly pitched to Musk a few months ago.

The IPO celebrations have been a weekslong affair at the investment bank, kicking off with Dimon’s interview with Musk on an investor call last Thursday for close to 4,000 bank clients, where the CEO called the enigmatic entrepreneur the “Edison of our time.” On Friday, artifacts from the moon landing were on display at the bank’s headquarters while the bank’s internal digital signage will feature SpaceX launch images. 

(Reporting by Dawn Kopecki, Akash Sriram, Saeed Azhar and Tatiana Bautzer in New York; editing by David Gaffen)

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By Laura Matthews and Saqib Iqbal Ahmed

NEW YORK, June 12 (Reuters) – Investors will soon get a new way to bet on SpaceX’s trajectory: options on the stock are set to begin trading as soon as Tuesday, with early activity expected to be heavy, volatile, and likely expensive.

Options on Elon Musk’s rocket and spacecraft manufacturer will follow its record trading debut on Friday, when shares jumped more than 25%, pushing its valuation above $2 trillion as investors piled in to bet on the sprawling empire, which spans rockets to AI.

Options exchange Cboe Global Markets expects options to start trading Tuesday, a spokesperson said. Market participants expect a broad mix of investors to likely enter once options begin trading, from shareholders seeking downside protection to traders positioning for volatility in the stock.

“I expect explosive demand,” said Ophir Gottlieb, chief executive of Capital Market Laboratories. “The largest IPO ever attached to one of the most controversial founders ever, pursuing what might be one of the most ambitious long-term goals ever, will equally generate some of the largest initial option volume in dollars ever.”

Options, which give holders the right but not the obligation to buy or sell shares at a predetermined price within a certain period, offer investors a low-cost way to gain exposure to a company’s stock and to express their views on short-term price moves and longer-term positioning.

They usually list within days of the stock’s debut. SpaceX opened at $150 on Friday, up from its $135 IPO price, and was trading around $172 in afternoon activity, making it the sixth-largest U.S. company by market value at more than $2 trillion.

EXPECT UPS AND DOWNS

If SpaceX behaves anything like the shares of Elon Musk’s electric vehicle company Tesla, it will be more volatile than the average stock, driving options activity.

Tesla’s five-year beta – a measure of volatility – is 1.81, according to LSEG data, where a reading of 1 means a stock’s volatility is in line with the market.

“I think we’re going to see a lot of volatility in the underlying stock,” said Seth Hickle, chief investment officer at Mindset Wealth Management, adding that implied volatility in options could be “very high”.

Investors expect activity to build around key events, including the company’s first quarterly report as a public entity and potential major equity index inclusions. Nasdaq has already adjusted its rules to ease SpaceX’s entry into the Nasdaq 100. MSCI said it will apply early inclusion rules for large IPOs, while S&P Global has ruled out fast-track inclusion into the broad-market S&P 500.

“We have been asked the question, ‘What day will the options be listed?’ more times than any IPO I can remember,” said Chris Murphy, co-head of derivatives strategy at Susquehanna, a market maker.

Skeptics can also use options to express bearish views without the risk of shorting SpaceX shares outright, although it will not be cheap.

“With a short, your risk is theoretically unlimited, your borrow costs can be punishing, and in a thin float like SPCX’s, a short squeeze can wipe you out before you’re ever proven right on the fundamentals,” said Luke Lango, chief technology analyst at financial research firm InvestorPlace.

(Reporting by Laura Matthews and Saqib Iqbal Ahmed in New York; editing by Megan Davies and David Gaffen)

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TRACY, Calif. (AP) — Firefighters responding to a blaze that destroyed a massive medical equipment warehouse in Northern California and sent embers flying for miles were hindered by sprinklers and hydrants that weren’t working, authorities said Friday.

The 1 million-square-foot (93,000-square-meter) warehouse in Tracy, a city about 55 miles (88.5 kilometers) east of San Francisco, supplied medical equipment to area hospitals. It’s owned by Medline, a major medical-surgical products provider of equipment such as latex gloves, masks, surgical instruments and other medical supplies.

Thick black smoke billowed Friday from the site, as firefighters continued to put out hot spots.

Authorities said they don’t yet know why the water system failed during the blaze but it appeared to be a problem with the facility’s system, not city supply. The blaze broke out around 1 p.m. Thursday. Crews found the building’s sprinkler system wasn’t working and hydrants on the property lacked water pressure, Tracy Deputy Fire Chief Brian Bagley said. A fire official found little or no water was flowing through either system, he said.

Firefighters were forced to try to connect to city hydrants instead. The building was engulfed by fire within 40 minutes, Bagley said.

“We did a defensive approach at that point,” he said.

The facility had been evacuated, and no one was injured. The massive warehouse was one of more than 50 distribution centers across the country for Medline, which according to its online catalog sells bandages, wheelchairs, catheters, hospital beds and many other medical supplies.

It is not clear what exactly was stored at the Tracy facility but the company said in a statement that the warehouse was mainly serving Northern California hospitals and that following the fire it activated a contingency plan.

“Product distribution previously supported by the Tracy facility has been reassigned and it is in the process of being deployed to other facilities within our regional network to help maintain service and support customer needs,” Medline said.

Embers from the blaze sparked two grass fires, and set pallets and multiple big rig trailers at a nearby FedEx facility ablaze. Firefighters were able to knock those fires down.

Crews overnight had to contend with new fires in trailers that were loaded with supplies.

Bagley said the Bureau of Alcohol, Tobacco, Firearms and Explosives would help investigate the cause of the blaze, but authorities would probably not be able to get into the warehouse for at least a couple of more days. The sprinkler system had been tested in January by an outside company and no issues were found, Bagley said.

The warehouse is in a massive industrial park that also houses fulfillment and distribution centers for Amazon, Home Depot and FedEx.

No homes were evacuated. Bagley recommended people near the fire stay indoors but said air quality tests had not raised any “grave concerns.”

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NEW YORK (AP) — The Treasury Department moved Friday to enlist the nation’s banks more deeply in President Donald Trump’s immigration crackdown, including issuing fresh guidance that lets banks rapidly share information about suspected customers and an advisory steering them to flag signs that one of their customers may lack legal immigration status.

These changes are part of the administration’s push to remove undocumented workers from the nation’s banking system without explicitly mandating that banks do so. In order to get banks to participate, the administration has framed these actions as a crackdown on fraud and crime, not explicitly about immigration.

“The information in your purview can help stop a cartel financier, disrupt a money laundering network, uncover labor exploitation, or protect taxpayers from fraud,” Treasury Secretary Scott Bessent said in prepared remarks at a banking conference in Houston.

Bessent’s remarks and the Treasury Department’s new guidelines come from an executive order signed in May by Trump that requires banks to take a closer look at the citizenship of their customers as well as directs bank regulators and government departments to look for signs that people without legal status are opening accounts or obtaining loans or credit cards. But that executive order did not include an explicit mandate that banks collect citizenship information, which the industry for months lobbied against.

Banks have long been able to share information about their customers with other banks under the Patriot Act program when they suspect money laundering or fraud, part of the post-9/11 effort to combat terrorism and other crimes.

Friday’s actions widened that system on two fronts. Banks can now share such information in real time and more freely.

Secondly, the Trump Administration is giving banks a wider variety of reasons to share information, which now include flags historically tied to immigration status. One example is a customer having an individual taxpayer identification number (ITIN), which are disproportionally used by undocumented immigrants when applying for work.

Bessent told bankers that the new guidance is simply part of what the banking system needs to do as part of their routine operations.

“The advisory does not ask banks to become immigration officers,” Bessent said. “It asks banks to do what they do best: know their customers, identify risk, recognize suspicious patterns, and report illicit activity when they see it.”

Bankers have been wary about sharing customer information with the federal government as part of immigration enforcement. Bankers never collected citizenship information on their customers, so any effort to do so would require a massive effort by banks and significant amounts of paperwork.

Immigration advocates have previously said any order that would order banks to collect citizenship information would likely result in undocumented immigrants moving out of the financial system, increasing the number of “unbanked” individuals.

The White House has taken other measures to discourage undocumented workers from using the financial system. The Treasury last November announced that it would reclassify certain refundable tax credits as “federal public benefits,” which bars some immigrant taxpayers from receiving them, even if they file and pay taxes and would otherwise qualify.

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HAVANA (AP) — Cuban President Miguel Díaz-Canel on Friday announced a package of economic reforms aimed at attracting investment, expanding participation by Cubans living abroad in the economy and decentralizing parts of the country’s administration.

The president did not provide details about the measures or a timetable for their implementation but said during remarks to state media that it is now “time to change” and that the country “simply cannot continue on its current course.”

“Every opportunity in the midst of a crisis must be seized as a moment for takeoff, as a moment for growth,” Díaz-Canel said, according to a statement from the presidency that was republished by state-run media. “We have established a group of priorities to confront this situation,” he added without offering specifics.

The announcement comes as Cubans have struggled with fuel shortages as a result of the U.S. oil blockade and food insecurity. In January, the United States tightened restrictions on Cuba’s oil supplies in an effort to pressure the island’s government to change its political and economic model, exacerbating challenges that have persisted for about five years.

The U.S. State Department did not immediately respond to a request for comment.

Díaz-Canel said officials are evaluating measures related to foreign trade, exports, supply chains and logistics. Without elaborating, he suggested the government could eliminate mandatory state intermediaries in import and export operations and grant tariff benefits to those who bring raw materials into the country for production.

“The numbers don’t add up, and the government wants to make this look like a matter of will rather than a math problem,” Cuban economist Pedro Monreal wrote on X, in response to Díaz-Canel’s proposals.

The Spain-based former UNESCO official went on to criticize the collapse of a centralized planning model, for which he said “there are two respectable alternatives: assume the political price of failure, or self-critically rectify and drastically transform the model.”

For decades, Cuba maintained a centralized, vertical system under strict state control. This structure began to shift gradually over the last decade when the government introduced permits for independent workers. More recently, the state authorized the operation of the country’s first small- and medium-sized private enterprises.

Earlier Friday, a ship carrying nearly 100 tons of food and essential goods arrived from Colombia as part of the humanitarian aid that several countries have sent to Cuba in recent months as a U.S. energy embargo persists.

The ship, which departed Cartagena in early June, crossed the Havana Bay channel early in the morning flying the Colombian flag and escorted by a small Cuban auxiliary vessel, The Associated Press confirmed.

The Colombian Presidential Agency for International Cooperation said that, on orders of President Gustavo Petro, the shipment included nonperishable food, medicine, hospital supplies, electrical materials, solar panels and other items.

The ship also carried seven tons of goods collected by solidarity groups.

Last weekend, another ship carrying 1,700 tons of essential goods from Mexico and Belize arrived in Havana.

In late January, U.S. President Donald Trump threatened tariffs on any country that sells or provides oil to Cuba. The move has deepened a preexisting crisis caused by U.S. sanctions. Washington is pressing the Cuban government to release political prisoners and move toward political and economic liberalization in return for a lifting of sanctions.

Cuba produces only 40% of its oil, leaving the island semiparalyzed and subjected to severe power outages.

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Follow AP’s coverage of Latin America and the Caribbean at https://apnews.com/hub/latin-america

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By Arathy Somasekhar

HOUSTON, June 12 (Reuters) – Exxon Mobil was poised to name Alex Volkov as head of global trading, two sources with knowledge of the matter said. 

On Thursday, Reuters reported that sources said Tracey Gunnlaugsson, who led the trading division since 2023, was set to retire. Exxon declined to comment.

Reuters could not immediately reach Volkov for comment.

Volkov, based in Texas, has spent nearly three decades at Exxon, holding roles across the U.S., Russia and London, according to his LinkedIn profile. He has served as a vice president in several parts of the business, including global LNG marketing, upstream commercial, strategy and business development, and, currently, commercial and integration.

David Brown, who was an international crude trader, is also retiring from Exxon, three sources said.

Exxon in May reported a $3.9 billion paper loss stemming from derivatives in the first quarter which pushed net income down to its lowest level in five years. The losses contrasted with the first-quarter trading profits of European oil majors, which have spent decades building trading desks and reaped billions of dollars from this year’s energy supply crunch triggered by the U.S.-Israeli war on Iran.

(Reporting by Arathy Somasekhar in Houston; Editing by Nathan Crooks and David Gregorio)

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By Elizabeth Howcroft

PARIS, June 11 (Reuters) – Before SpaceX goes public, crypto exchanges are giving traders a way to make risky bets on the company’s future share price.

Billions of dollars have flowed into instruments dubbed “pre-IPO perpetual futures”, which have no direct link to the underlying shares but are priced with reference to SpaceX’s latest disclosed pre-IPO valuation.

These types of derivatives, known as “perps”, are already used to bet on cryptocurrency price moves. They roll over indefinitely and allow investors to borrow in order to make bigger bets.

The popularity of new pre-IPO perps – which trade on exchanges including Binance, Coinbase and Hyperliquid – has intensified the clash between crypto and Wall Street ahead of a wave of blockbuster IPOs set to also include AI giants Anthropic and OpenAI.

News that U.S. regulators would approve perps betting on cryptocurrencies was enough to knock the shares of New York Stock Exchange parent Intercontinental Exchange earlier this week, as investors weighed up what they saw as a long-term competitive threat for incumbent bourses.

The selloff continued into the next session, in part due to fear among investors that the contracts would be extended to equities.

‘MIND-BOGGLING’ VOLUMES

Global markets are bracing for the IPO of Elon Musk’s SpaceX, which aims to raise a record $75 billion to fund expansion as the world’s richest man pursues long-term ambitions, including colonising Mars and building data centres in space.

There was around $3.2 billion in trading volume and $390 million in open interest on SpaceX pre-IPO perps from May 17 to Wednesday, according to data provider Talos, which included eight exchanges in its figures.

Binance said its SpaceX pre-IPO perps saw $2.1 billion in trading volume in 18 days, but declined to break this down by region.

“This is obviously aimed at a crypto-native, crypto-friendly audience that are looking to obtain high-leverage bets on specific market movements,” said Philippe Noeltner, a lawyer at A&O Shearman, calling the volumes “mind-boggling”.

Crypto perps often offer high degrees of leverage — as much as 100-to-1 — ​although for the recently launched pre-IPO perps, the leverage is usually capped at 3x to 5x, analysts said.

Crypto exchanges typically make money from the products by market-making and charging fees to buyers.

‘THE HYPER-GAMBLER-ISATION OF EVERYTHING’

Proponents say pre-IPO perpetuals – which are generally not available to U.S. investors – are a tool for price discovery and help more people get access to the U.S. stock market’s gains.

But critics say they are risky as they have low liquidity, high volatility and – unlike tokenised stocks – are not pegged to any underlying asset. Once the stock floats, the price of the instrument is adjusted to reflect the share price, though details vary from exchange to exchange.

The price of SpaceX pre-IPO perps has fallen from above $200 to around $160 in less than a month, according to Kaiko price data. SpaceX shares are due to price at $135 apiece.

“This pre-IPO perpetual isn’t really anchored towards anything other than speculation,” said Kaiko analyst Laurens Fraussen.

“The pre-IPO thing is, alongside prediction markets, a good example of where the world is heading… it’s like the hyper-gambler-isation of everything.”

The World Federation of Exchanges, an industry body which represents stock exchanges, said that buyers might think they are getting an asset that comes with the guardrails of listed products, and that it was hard to be sure how robust the price formation would be.

“These are fundamental principles and we will work this issue into our dialogue with regulators,” a WFE spokesperson told Reuters via email.

SPACEX FRENZY MEETS CRYPTO

The SpaceX IPO and crypto are both “exciting stories”, said Alex Edman, a London Business School professor who researches investor psychology, cautioning that people should ensure they understand what they are buying.

“With SpaceX, investors may have done a little bit of research and conclude that space exploration is the future. With crypto, they may learn about potential use cases. But neither tells you what the asset is actually worth.”

Little is known about who or what is driving the volumes of pre-IPO perps. Coinbase and Binance declined to comment on how many users had bought SpaceX pre-IPO perps, and data provider Talos said it was not possible to determine from public data.

“It’s also very difficult to know who’s active in these markets, whether it’s your retail trader punting £10 or a proprietary trading desk of a hedge fund taking a position,” said A&O Shearman’s Noeltner.

“It’s better not to assume that these are only retail traders.”

(Reporting by Elizabeth Howcroft; Editing by Jan Harvey)

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A look at the day ahead in European and global markets from Stella Qiu

Hope, as the saying goes, springs external. President Donald Trump has trumpeted an imminent peace deal with Iran so many times that it’s easy to lose track. But this time he’s offered something tantalisingly specific – a weekend signing ceremony in Europe with his vice president – and that was enough for stock investors to jump right back into an already frothy market.

Since then, Iran has attacked ships in the Strait of Hormuz, denied it had reached a final decision on any deal and vowed not to compromise on its red-line demands.

Still, the response was a full-throated risk-on roar across Asia. South Korea led the charge with a monstrous 8% jump, while Japan’s Nikkei leapt 3.5%. European bourses are slated to open almost 2% higher, with Wall Street futures adding to a strong overnight rally.

Bonds also rallied as oil prices hit two-month lows and lessened inflation fear. The European Central Bank had to raise interest rates for the first time in nearly three years to nip war-driven inflation in the bud, but if the Strait of Hormuz reopens soon, the chance for a follow-up hike next month will dwindle.

For Kevin Warsh, who is about to chair his first U.S. Federal Reserve meeting next week, a peace deal would be a godsend, perhaps even putting rate cuts back on the table.

Elsewhere, it seems to be the season for central bank sick notes. Bank of Japan Governor Kazuo Ueda will miss next week’s meeting, where a hike to 1% is widely expected, as he recovers from a liver cyst.

Russia’s central bank meets next Friday and its chief, Elvira Nabiullina, has not been seen since May 28 due to illness. President Vladimir Putin has already signalled he expects a rate cut, much like a certain president would want in the U.S.

Before all the central bank excitement, Elon Musk’s SpaceX debuts on the stock market today after raising a record $75 billion, valuing the company at $1.77 trillion and making its founder the world’s first trillionaire (a word not even recognised by our spellchecker). A strong opening would provide one more reason to be bullish.

Key developments that could influence markets on Friday:

• Prospects of an imminent peace deal in the Gulf

• SpaceX begins trading on the NASDAQ

• University of Michigan June consumer sentiment survey

• Monthly UK GDP data, French and German final CPI for May

(By Stella Qiu; Editing by Christopher Cushing)

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