Crypto News: Pressing pause

Donald Trump's rare defeat last week before the Supreme Court continued to resonate Monday as US trading partners stepped back to reassess compromises and deals they made with the president over the past year.

The European Union froze ratification of its US accord until the dust settled around a new White House strategy in the global trade war Trump launched almost a year ago. The EU's initial read on Trump's latest tariff proposals is that they violate the agreement it made with him last year.

"We want to have clarity about the situation," European Parliament trade committee chair Bernd Lange said Monday. "We want to have clarity from the US that they are respecting the deal because that's a crucial element."

For his part, Trump responded with fresh threats. But with midterm elections approaching and his approval rating hitting new lows, Democrats appear to smell weakness when it comes to his trade war. Some of the party's biggest names are seizing on Trump's loss to wage a populist election-year campaign to refund all those billions of dollars in tariffs to taxpayers. —David E. Rovella

What You Need to Know Today

Weather

Northeast US Reels From Monster Storm

It has knocked out power to 600,000 homes and businesses across the region and grounded more than 10,000 flights through Tuesday.

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It's time for some more AI "scare trades." Delivery, payments and (again) software stocks slid sharply Monday after a report laying out the potential risks that artificial intelligence could pose to various segments of the global economy.

DoorDash, American Express, KKR and Blackstone all slumped more than 8%. Shares of other companies name-checked in the writeup, including Uber, Mastercard, Visa, Capital One and Apollo Global Management were all lower by at least 3%.

Citrini Research presented a hypothetical scenario set a little more than two years from now, one where AI's disruption has caused mass unemployment for white collar workers, declining consumer spending, software-backed loan defaults and economic contraction. While the report notes it's a "scenario, not a prediction," some investors took it to heart.

Markets Wrap

Stocks Slammed by AI-Disruption Fears

"The software selloff is a reminder of what can happen when momentum-driven sectors shift into reverse," said Steve Sosnick at Interactive Brokers. "The broader, more important question is: How many sectors can go into reverse before they drag the broader market along with them?"

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Since a stock slide wiped out almost half of its value, PayPal has been looking a little vulnerable to some opportunists circling in the sky above. Indeed, its shares jumped as much as 9.7% on news that it's attracting takeover interest.

Founded in the late 1990s, PayPal was an early mover in the world of digital payments. But these days it's been fighting off rivals muscling in on its turf. Still, analysts from Mizuho Securities said the company is "deeply undervalued given that it is one of four globally recognized payment networks." PayPal has almost $2 trillion in annual transaction volume and the "most prominent US P2P network" in Venmo, the firm wrote in a note. No wonder it's attracting attention.

More 'Scare Trades'

IBM Sinks Most Since 2000 as Anthropic Touts Cobol Tool

International Business Machines shares had their worst day in 25 years after the AI company said its Claude Code tool can help modernize Cobol, a dated programming language run on IBM computers.

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Four lean years. Well, relatively—we are talking about private equity. But still, the sector has managed to return even fewer profits to investors for a fourth straight year as it sat on $3.8 trillion of unsold assets while struggling to raise money for new funds.

Distributions as a percentage of net asset value remained at 14% last year—the second-lowest level since the depths of the 2008 financial crisis, according to a new report from Bain & Co. And the duration of the rut is even more severe than what private equity firms faced back then. So what's going on?

Bloomberg Opinion

Sheinbaum Kills a Drug Lord and Crosses Her Rubicon

Every time a major cartel loses its boss, a bloody struggle follows as players and factions move to fill the vacuum.

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Canadian generic drug manufacturer Apotex is looking at an initial public offering in the first half of the year that could raise as much as C$1 billion ($730 million). An IPO of that size would be Canada's largest debut since 2021.

The potential offering comes as other Canadian companies test the market. Saskatchewan's AGT Food and Ingredients is expected to be among the first sizable listings this year. The agribusiness and some of its shareholders are seeking to raise as much as C$460 million.