Raphael Stevens

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    Chinese tea chain Chagee climbs 15% in stock market debut

    Chagee made its public market debut on the Nasdaq, trading under the ticker “CHA.”
    The Chinese tea chain was founded in 2017 and has grown to more than 6,400 teahouses.
    Chagee is planning to open its first U.S. location at the Westfield Century City mall in Los Angeles later this spring.

    People shopping at a Chagee store in Shanghai, China, on Oct. 18, 2023.
    Costfoto | Nurphoto | Getty Images

    Shares of Chinese tea chain Chagee climbed 15% during its public market debut on Thursday, as the company plans a U.S. launch despite trade tensions between Washington and Beijing.
    The stock, which is trading on the Nasdaq using the ticker “CHA,” opened at $33.75 per share. Chagee shares soared as high as 49% initially but lost much of those gains during afternoon trading.

    The company priced its initial public offering at $28 per share on Wednesday, on the high end of its expected range of $26 to $28. Chagee sold 14.7 million shares, raising $411 million and valuing the company at roughly $5 billion.
    Since its founding in 2017, the company has grown to more than 6,400 teahouses across China, Malaysia, Singapore and Thailand. Last year, Chagee generated net income of $344.5 million from revenue of $1.7 billion, according to regulatory filings.
    The company is preparing to open its first U.S. location later this spring at the Westfield Century City mall in Los Angeles.
    Founder and CEO Junjie Zhang created the chain after being inspired by the success of international coffee companies. China is Starbucks’ second-largest market.
    Chagee’s initial public offering follows several weeks of market turmoil after President Donald Trump imposed new tariffs and ignited a trade war with China. Other IPO hopefuls, including Klarna and StubHub, delayed their plans to go public after markets plunged.
    In recent years, it has also become less popular for Chinese companies to list on U.S. exchanges. From January 2023 to January 2024, the number of Chinese companies listed on the three largest U.S. exchanges fell 5%, according to the U.S.-China Economic and Security Review Commission.

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    Harvard’s battle with the Trump administration is creating a thorny financial situation

    Harvard is the richest university in the U.S. with an endowment greater than the GDP of many countries.
    The Trump administration freezing $2.2 billion in grants is still a severe blow to the Ivy League institution.
    Using its $52 billion endowment to cover the shortfall isn’t as easy as smashing open a piggy bank.

    Harvard University’s Dunster House in Cambridge, Massachusetts.
    Blake Nissen for The Boston Globe via Getty Images

    Harvard’s brewing conflict with the Trump administration could come at a steep cost — even for the nation’s richest university.
    On April 14, Harvard University President Alan Garber announced the institution would not comply with the administration’s demands, including to “audit” Harvard’s students and faculty for “viewpoint diversity.” The federal government, in response, froze $2.2 billion in multi-year grants and $60 million in multi-year contracts with the university.

    According to CNN and multiple other news outlets, the Trump administration has now asked the Internal Revenue Service to revoke Harvard’s tax-exempt status. If the IRS follows through, it would have severe consequences for the university. The many benefits of nonprofit status include tax-free income on investments and tax deductions for donors, education historian Bruce Kimball told CNBC.
    Bloomberg estimated the value of Harvard’s tax benefits in excess of $465 million in 2023.
    Nonprofits can lose their tax exemptions if the IRS determines they are engaging in political campaign activity or earning too much income from unrelated activities. Few universities have lost their non-profit status. One of the few examples was Christian institution Bob Jones University, which lost its tax exemption in 1983 for racially discriminatory policies.
    White House spokesperson Harrison Fields told the Washington Post that the IRS started investigating Harvard before President Donald Trump suggested on Truth Social that the university should be taxed as a “political entity.” The Treasury Department did not reply to a request for comment from CNBC.
    A Harvard spokesperson told CNBC that the government has “no legal basis to rescind Harvard’s tax exempt status.”

    “The government has long exempted universities from taxes in order to support their educational mission,” the spokesperson wrote in a statement. “Such an unprecedented action would endanger our ability to carry out our educational mission. It would result in diminished financial aid for students, abandonment of critical medical research programs, and lost opportunities for innovation. The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”  
    The federal government has challenged Harvard on yet another front, with the Department of Homeland Security threatening to stop international students from enrolling. The Student and Exchange Visitor Program is administered by Immigration and Customs Enforcement, which falls under the DHS.
    International students make up more than a quarter of Harvard’s student body. However, Harvard is less financially dependent on international students than many other U.S. universities as it already offers need-based financial aid to international students in its undergraduate program. Many other universities require international students to pay full tuition.
    The Harvard spokesperson declined to comment to CNBC on whether the university would sue the administration over the federal funds or any other grounds. Lawyers Robert Hur of King & Spalding and William Burck of Quinn Emanuel are representing Harvard, stating in a letter to the federal government that its demands violate the First Amendment.
    Harvard, the nation’s richest university, has more resources than other academic institutions to fund a long legal battle and weather the storm. However, its massive endowment — which has raised questions during the recent developments — is not a piggy bank.

    Why Harvard’s endowment is so large

    Harvard has an endowment of nearly $52 billion, averaging $2.1 million in endowed funds per student, according to a study by the National Association of College and University Business Officers, or NACUBO, and asset manager Commonfund.
    That size makes it larger than than the GDP of many countries.
    The endowment generated a 9.6% return last fiscal year, which ended June 30, according to the university’s latest annual report.

    Founded in 1636, Harvard has had more time to accumulate assets as the nation’s oldest university. It also has robust donor base, receiving $368 million in gifts to the endowment in 2024. While the university noted that more than three-quarters of the gifts averaged $150 per donor, Harvard has a history of headline-making donations from ultra-rich alumni.
    Kimball, emeritus professor of philosophy and history of education at the Ohio State University, attributes the outsized wealth of elite universities like Harvard to a willingness to invest in riskier assets.
    University endowments were traditionally invested very conservatively, but in the early 1950s Harvard shifted its allocation to 60% equities and 40% bonds, taking on more risk and creating the opportunity for more upside.
    “Universities that didn’t want to assume the risk fell behind,” Kimball told CNBC in March.
    Other universities soon followed suit, with Yale University in the 1990s pioneering what would become the “Yale Model” of investing in alternative assets like hedge funds and natural resources. Though it proved lucrative, only universities with large endowments could afford to take on the risk and due diligence that was needed to succeed in alternative investments, according to Kimball.
    According to Harvard’s annual report, the largest chunks of the endowment are allocated to private equity (39%) and hedge funds (32%). Public equities constitute another 14% while real estate and bonds/TIPs make up 5% each. The remainder is divided between cash and other real assets, including natural resources.
    The university has made substantial portfolio allocation changes over the past seven years, the report notes. The Harvard Management Company has cut the endowment’s exposure to real estate and natural resources from 25% in 2018 to 6%. These cuts allowed the university to increase its private equity allocation. To limit equity exposure, the endowment has upped its hedge fund investments.

    The endowment is not a piggy bank

    University endowments, though occasionally staggering in size, are not slush funds. The pools are actually made up of hundreds or even thousands of smaller funds, the majority of which are restricted by donors to be dedicated to areas including professorships, scholarships or research.
    Harvard has some 14,600 separate funds, 80% of which are restricted to specific purposes including financial aid and professorships. Last fiscal year, the endowment distributed $2.4 billion, 70% of which was subject to donors’ directives.
    “Most of that money was put in for a specific purpose,” Scott Bok, former chairman of the University of Pennsylvania, told CNBC in March. “Universities don’t have the ability to break open the proverbial piggy bank and just grab the money in whatever way they want.”
    Some of these restrictions are overplayed, according to former Northwestern University President Morton Schapiro.
    “It’s true that a lot of money is restricted, but it’s restricted to things you’re going to spend on already like need-based aid, study abroad, libraries,” Bok said previously.

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    How Harvard is shoring up its finances

    Harvard has $9.6 billion in endowed funds that are not subject to donor restrictions. The annual report notes that “while the University has no intention of doing so,” these assets “could be liquidated in the event of an unexpected disruption” under certain conditions.
    Liquidating $9.6 billion in assets, nearly 20% of total endowed funds, would come at the cost of future cash flow, as the university would have less to invest.
    Harvard did not respond to CNBC’s queries about increasing endowment spending. Like most universities, it aims to spend around 5% of its endowment every year. Assuming the fund generates high-single-digit investment returns, spending just 5% allows the principal to grow and keep pace with inflation.
    For now, Harvard is taking a hard look at its operating budget. In mid-March, the university started taking austerity measures, including a temporary hiring pause and denying admission to graduate students waitlisted for this upcoming fall.
    Harvard is also issuing $750 million in taxable bonds due September 2035. This past February, the university issued $244 million in tax-exempt bonds. A slew of universities including Princeton and Colgate are also raising debt this spring.
    So far, Moody’s has not updated its top-tier AAA rating for Harvard’s bonds. However, when it comes to higher education as a whole, the ratings agency isn’t so optimistic, lowering its outlook to negative in March. More

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    UnitedHealth’s stock is plunging on higher medical costs. That may mean trouble for more insurers

    UnitedHealth Group’s stock sank after the company slashed its annual profit forecast, citing higher-than-expected medical costs in its privately run Medicare plans. 
    Those bleak results from a health-care giant seen as the insurance industry’s bellwether could potentially be a warning sign for other companies with so-called Medicare Advantage plans, according to some Wall Street analysts.
    UnitedHealth’s first-quarter results reveal “ominous signs” of an accelerating medical costs trend in Medicare Advantage businesses, some analysts said.

    Traders work at the post where UnitedHealth Group is traded on the floor of the New York Stock Exchange.
    Brendan McDermid | Reuters

    UnitedHealth Group’s stock sank 20% on Thursday after the company slashed its annual profit forecast, citing higher-than-expected medical costs in its privately run Medicare plans. 
    Those bleak results from a health-care giant seen as the insurance industry’s bellwether could be a warning sign for other companies with so-called Medicare Advantage plans, according to some Wall Street analysts. It comes after a turbulent 2024 for health insurers, hurt by lower government payments, soaring medical costs and public backlash after the murder of UnitedHealthcare’s top executive, Brian Thompson.

    UnitedHealthcare, the insurance arm of UnitedHealth Group, is the nation’s largest provider of those plans. Shares of competitor Humana fell 5%, while Elevance Health dropped more than 1% and CVS tumbled 2%. Cigna has no Medicare Advantage business. Its stock was up almost 1% on Thursday.
    UnitedHealth’s first-quarter results reveal “ominous signs” of accelerating medical costs in Medicare Advantage businesses, TD Cowen analyst Ryan Langston said in a note Thursday. He added that the company “correctly foreshadowed” increasing medical costs back in 2023, so Thursday’s comments “will call into question” the full-year outlooks for every insurer. 
    Higher medical costs have dogged the entire insurance industry over the past year as more seniors return to hospitals to undergo procedures they had delayed during the Covid-19 pandemic, such as joint and hip replacements. But the issue had previously not been as significant at UnitedHealthcare.
    Barclays analyst Andrew Mok said UnitedHealth’s problems may be less of an issue for companies that made “significant” exits from some Medicare Advantage markets, including Humana and CVS, according to a note Thursday. Many insurers last year exited unprofitable Medicare Advantage markets due to higher medical costs and lower reimbursement rates from the federal government. 
    Meanwhile, the issue could be a bigger deal for companies that gained greater market share in Medicare Advantage, such as Elevance Health and Alignment Health, according to Mok.

    UnitedHealth said the rise in care use, or utilization, in its Medicare Advantage business came in far above what the company planned for the year, which was for care activity to increase at a rate consistent with what it saw in 2024. But trends that became apparent toward the end of the first quarter suggest that care activity increased “at twice” that level, UnitedHealth Group CEO Andrew Witty said during an earnings call on Thursday. 
    The jump was particularly notable in doctor and outpatient services, which do not involve overnight hospital stays, he added. 
    “It’s very, very unusual,” Lance Wilkes, Bernstein senior equity analyst, told CNBC’s “Squawk Box” on Thursday. He said rising utilization is “really surprising” coming off the high level of care activity that the industry saw over the past year.
    Wilkes added that UnitedHealth and the broader industry may be “pulling back” the “intensity of some of the activity they do to manage utilization,” which causes dissatisfaction among patients. For example, some insurers require prior authorization, which makes providers obtain approval from a patient’s insurance company before administering specific treatments.
    “I think it’s probably United pulling back because of the policy headwinds and the scrutiny on the company,” Wilkes said. “I do think the horrible thing that happened to Brian Thompson and the company is a part of this, and I think it’s reflective of also the Department of Justice scrutiny on United over the last couple years.”
    UnitedHealth is reportedly grappling with a government investigation of its Medicare billing practices.
    Also on Thursday, UnitedHealth pointed to issues related to changes in the profile of patients treated under its Optum health-care unit. That segment includes its pharmacy benefit manager, which negotiates drug rebates with manufacturers on behalf of insurers and maintains formularies, among other responsibilities. 
    But Witty said the company is taking action to improve results and considers the issues related to Optum and elevated medical costs “highly addressable as we look ahead to 2026.” 
    If nothing else, insurers are set to get a boost next year. The Trump administration in April said it would substantially increase reimbursement rates for Medicare Advantage insurers, hiking an earlier proposal from the Biden administration.  

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    Should investors dump U.S. stocks for international equities? Here’s what experts are saying

    U.S. stocks had been outperforming the world for years heading into 2025.
    Now, some investors are changing their investment strategy to boost their international exposure.
    Although global diversification may be a good move as U.S. markets come under pressure, CNBC Financial Advisor Council members caution against chasing returns.

    Some investors accustomed to the dominance of U.S. stocks versus the rest of the world are making a stunning pivot toward international equities, fearing U.S. assets may have taken on more risk amid escalating trade tensions initiated by President Donald Trump.
    The S&P 500 sank more than 6% since Trump first announced his tariff plan, while the Dow and Nasdaq have each tumbled more than 7%.

    There was a strong argument to dial back U.S. stock holdings and adopt a more global portfolio even before the recent volatility, said Christine Benz, director of personal finance and retirement planning for Morningstar.
    “But I think the case for international diversification is even greater [now], given recent developments,” she said.
    Jacob Manoukian, head of U.S. investment strategy at J.P. Morgan Private Bank, offered a similar assessment. “Global diversification seems like a prudent strategy,” he wrote in a research note on Monday.

    U.S. had the world beat by ‘sizable margin’

    Some experts, however, don’t think investors should be so quick to dump U.S. stocks and chase returns abroad.
    The United States is still “a quality market that looks like a bargain,” said Paul Christopher, head of global investment strategy at the Wells Fargo Investment Institute.

    U.S. stocks had been outperforming the world for years heading into 2025.

    The S&P 500 index had an average annual return of 11.9% from mid-2008 through 2024, beating returns of developed countries by a “sizable margin,” according to analysts at J.P. Morgan Private Bank.
    The MSCI EAFE index — which tracks stock returns in developed markets outside of the U.S. and Canada — was up 3.6% per year over the same period, on average, they wrote.
    However, the story is different this year, experts say.
    “In a surprising twist, the U.S. equity market has just offered investors a timely reminder about why diversification matters,” the analysts at J.P. Morgan Private Bank wrote. “Although U.S. outperformance has been a familiar feature of global equity markets since mid-2008, change is possible.”
    More from Personal Finance:Why retirees shouldn’t fully ditch stocksCash may feel safe when stocks slide, but it has risksHow a trade war could impact the price of clothing
    The Trump administration’s tariff policy and an escalating trade war with China have raised concerns about the growth of the U.S. economy.
    U.S. markets have been under pressure ever since the White House first announced country-specific tariffs on April 2. Trump imposed tariffs on many nations, including a 145% levy on imports from China.
    As of Thursday morning, the S&P 500 was down roughly 10% year-to-date, while the Nasdaq Composite has pulled back more than 16% in 2025. The Dow Jones Industrial Average had lost nearly 8%. Alternatively, the EAFE was up about 7%.

    Is U.S. exceptionalism dead?

    The sharp sell-off in U.S. markets has raised doubts as to whether U.S. assets “are as attractive to foreigners now as they once were and, perhaps as a consequence, whether ‘U.S. [equity] market exceptionalism’ could be on the way out,” market analysts at Capital Economics wrote Thursday.
    At the same time, rising global trade tensions have taken a toll on the bond market, threatening to shake the confidence of holders of U.S. debt. The U.S. dollar has also weakened, nearing a one-year low as of Thursday morning.
    It’s unusual for U.S. stocks, bonds and the dollar to fall at the same time, analysts said.
    Former Treasury Secretary Janet Yellen said Monday that President Donald Trump’s tariffs have made it more difficult for Americans to find comfort in the U.S. financial system.
    “This is really creating an environment in which households and businesses feel paralyzed by the uncertainty about what’s going to happen,” Yellen told CNBC during a “Squawk Box” interview. “It makes planning almost impossible.”

    The U.S. fire had ‘already been burning’

    A trader works on the floor of the New York Stock Exchange at the opening bell in New York City, on April 17, 2025.
    Timothy A. Clary | AFP | Getty Images

    That said, international and U.S. stock returns tend to ebb and flow in cycles, with each showing multi-year periods of relative strength and weakness.
    Since 1975, U.S. stock returns have outperformed those of international stocks for stretches of about eight years, on average, according to an analysis by Hartford Funds through 2024. Then, U.S. stocks cede the mantle to international stocks, it said.
    Based on history, non-U.S. equities are overdue to reclaim the top spot: The U.S. is currently 13.8 years into the current cycle of stock outperformance, according to the Hartford Funds analysis.

    U.S. markets had already showed weakness heading into the year amid concerns about the health of the economy grew and as “air came out the valuations of ‘big-tech’ stocks,” according to Capital Economics analysts.
    “In that respect, ‘Liberation Day’ — which accentuated these moves — only added fuel to a fire that had already been burning,” they wrote.

    Advisors: ‘Tread carefully here’

    A good starting point for investors would be to mirror a global stock fund like the Vanguard Total World Stock Index Fund ETF (VT), said Benz of Morningstar. That fund holds about 63% of assets in U.S. stocks and 37% in non-U.S. stocks.
    It may make sense to pare back exposure to international stocks as individual investors approach retirement, she said, to reduce the volatility that comes from fluctuations in foreign exchange rates.
    “Part of our core models for clients have always had international exposure, it’s traditionally part of any risk-adjusted portfolio,” said certified financial planner Douglas Boneparth, president of Bone Fide Wealth in New York, of the conversations he is having with his clients.

    Financial advisor or business people meeting discussing financial figures. They are discussing finance charts and graphs on a laptop computer. Rear view of sitting in an office and are discussing performance
    Courtneyk | E+ | Getty Images

    Even though those asset classes didn’t perform as well over the last few years, “they’ve done a pretty good job here of helping reduce the brunt of this tariff volatility,” said Boneparth, a member of the CNBC Financial Advisor Council.
    Still, Boneparth cautions investors against making any sudden moves to add non-U.S. equities to their portfolios.
    “If you are thinking about making changes now, be careful,” he said. “Do you lock in losses to U.S. stocks to gain international exposure? You want to tread carefully here,” he said. “Are you chasing or timing? You usually don’t want to do those things.”
    However, this may be a good time to check your investments to make sure you are still allocated properly and rebalance as needed, he added. “By rebalancing, you can rotate out of less risky assets into equities, strategically buying the dip.”

    There have been very few times in history when clients asked about increasing their investments overseas, “which is happening now,” said CFP Barry Glassman, the founder and president of Glassman Wealth Services.
    “Given that both stocks and currency are outperforming U.S. indices it’s no wonder there is greater interest in foreign stocks today,” said Glassman, who is also a member of the CNBC Advisor Council.
    “Even in the past, when U.S. stocks have fallen, the dollar’s gains helped to offset a portion of the losses. In the past two weeks, that has not been the case,” he said.
    Glassman said he maintains a two-thirds to one-third ratio of U.S. stocks to foreign stock funds in the portfolios he manages.
    “We are not making any moves now,” he said. “The moves for us were made over time to maintain what we consider the appropriate foreign allocation.” More

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    Trump again calls for Fed to cut rates, says Powell’s ‘termination cannot come fast enough’

    President Donald Trump on Thursday again called for the Federal Reserve to lower rates and even hinted at the “termination” of Chair Jerome Powell.
    His post on Truth Social comes a day after Powell delivered a speech at the Economic Club of Chicago in which he noted that the administration’s tariffs put the central bank in a tricky spot as it decides whether to tame inflation or boost growth.
    This is not the first time Trump has criticized Powell’s approach to U.S. monetary policy.

    U.S. President Donald Trump, left, and U.S. Federal Reserve Chair Jerome Powell.
    Win McNamee | Kevin Lamarque | Reuters

    President Donald Trump on Thursday again called for the Federal Reserve to lower rates and even hinted at the “termination” of Chair Jerome Powell.
    In a Truth Social post, Trump said:

    “The ECB is expected to cut interest rates for the 7th time, and yet, ‘Too Late’ Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete ‘mess!’ Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS. Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough!”

    Indeed, the European Central Bank has been cutting rates as it tries to boost growth in the region. The ECB is expected to lower rates again later on Thursday.
    The post comes a day after Powell delivered a speech at the Economic Club of Chicago in which he noted that the administration’s tariffs put the central bank in a tricky spot as it decides whether to tame inflation or boost growth.

    “If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close,” Powell said. Those comments contributed to a steep sell-off on Wednesday.
    This is not the first time Trump has criticized Powell’s approach to U.S. monetary policy. Trump posted on April 4, two days after the administration’s “Liberation Day” tariff announcement, that it would be “a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always ‘late,’ but he could now change his image, and quickly.”
    However, it is the first time Trump has explicitly called for Powell’s firing. Powell has said the president does not have the power to fire him, noting that it is “not permitted under the law.”
    Powell’s term as Fed chair ends in May 2026.

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    Eli Lilly’s weight loss pill succeeds in first late-stage trial on diabetes patients

    Eli Lilly said its daily obesity pill met the company’s goals in the first of several closely watched late-stage trials.
    The pill helped Type 2 diabetes patients lower their blood sugar and body weight and showed safety on par with popular injections on the market, with some results coming in line with Wall Street’s expectations.
    The trial data is among the pharmaceutical industry’s most closely watched studies of the year, as they bring Eli Lilly’s pill — called orforglipron — one step closer to becoming a new, needle-free alternative in the booming weight loss and diabetes market. 

    Eli Lilly on Thursday said its daily obesity pill met the company’s goals in the first of several late-stage trials, helping patients with Type 2 diabetes lower their blood sugar and body weight and showing safety comparable with popular injections on the market. 
    The trial results are among the pharmaceutical industry’s most closely watched studies of the year, as they bring Eli Lilly’s experimental pill — called orforglipron — another step closer to becoming a new, needle-free alternative in the booming weight loss and diabetes market. This more convenient, easier-to-manufacture pill could give Eli Lilly a major edge over Novo Nordisk and other rivals trying to enter the lucrative space.

    The pill’s weight loss data, along with rates of side effects and treatment discontinuations, were in line with what some Wall Street analysts were expecting. But orforglipron fell short of some analysts’ estimates for a key diabetes metric.
    Eli Lilly shares climbed 11% in premarket trading.
    The highest dose of the pill helped patients lose 7.9% of their weight, or around 16 pounds, on average after 40 weeks. Eli Lilly also said patients saw no plateau in their weight loss by the time the study ended, suggesting they could lose more beyond that period.
    Previous studies on the pill and existing injections have shown that patients with diabetes lose less weight than those without the condition, making it difficult to compare the data to that of drugs specifically for obesity. 
    About 8% of patients who took the highest dose of the pill discontinued treatment due to side effects. Those side effects were mainly gastrointestinal — such as nausea and vomiting — and mild to moderate in severity. An estimated 14% of those who took the highest dose experienced vomiting, while 16% and 26% had nausea and diarrhea, respectively.

    In a note earlier this month, TD Cowen analysts said they expected a discontinuation rate of 9%. Other analysts said they anticipated the side effects of the pill would be slightly worse than injections, given that it is taken daily instead of weekly. 
    But the pill missed some analysts’ estimates for a key diabetes metric. It helped lower hemoglobin A1c — a measure of blood sugar levels — by an average of 1.3% to 1.6% across different doses at 40 weeks, from a starting level of 8%. That compares to a 0.1% reduction in patients who took a placebo during the same period. 
    Some analysts were expecting a reduction of as much as 1.8% to 2.1%, which is in line with results in diabetes patients who took Novo Nordisk’s diabetes injection Ozempic. 
    Still, Eli Lilly is “pleased to see that our latest incretin medicine meets our expectations for safety and tolerability, glucose control and weight loss, and we look forward to additional data readouts later this year,” the company’s CEO David Ricks said in a release. Incretin drugs mimic certain gut hormones to suppress a person’s appetite and regulate blood sugar.
    There are seven late-stage studies on the pill, including five diabetes trials and two obesity studies. The company expects to file for regulatory approval of the pill for obesity by the end of the year, and for diabetes in 2026.
    If approved, orforglipron could help more patients access treatment and alleviate the supply shortfalls of the popular injections on the market. The pill “could be readily manufactured and launched at scale for use by people around the world,” Ricks said in the release. 
    The pill could also help Eli Lilly solidify its dominance in the growing segment as a slate of other drugmakers race to bring similar products to the market.
    Offering the first oral version of a so-called GLP-1 could help Eli Lilly capture an even greater share of the market for that popular class of weight loss and diabetes drugs. Eli Lilly is currently about three years ahead of other drugmakers developing pills, including AstraZeneca, Roche, Structure Therapeutics and Viking Therapeutics, analysts told CNBC. 
    Some analysts expect the market for GLP-1s to be worth more than $150 billion annually by the early 2030s. Oral GLP-1s could grow to be worth $50 billion of that total, according to some analyst estimates. 
    Eli Lilly’s pill works in a similar way to Wegovy, Ozempic and Novo Nordisk’s diabetes pill Rybelsus, targeting a gut hormone called GLP-1 to suppress a person’s appetite and regulate blood sugar. 
    But unlike those three medications, Eli Lilly’s pill is not a peptide medication. That means it is absorbed more easily by the body and does not require dietary restrictions like Rybelsus does.

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    Target CEO Cornell to meet with Sharpton to discuss DEI rollback as civil rights leader considers boycott

    Target CEO Brian Cornell will meet with civil rights leader the Rev. Al Sharpton to discuss the company’s decision to roll back DEI programs.
    The discussion comes as the big box retailer faces calls for a boycott and a slump in foot traffic that began soon after it announced plans to walk away from some DEI initiatives.
    Sharpton has not called for a boycott of Target, but said he’ll consider it if the company doesn’t reaffirm its commitment to Black businesses, employees and consumers.

    People walk past Target Store in Midtown Manhattan on March 6, 2025 in New York City, United States. 
    Mostafa Bassim | Anadolu | Getty Images

    Target CEO Brian Cornell will meet with the Rev. Al Sharpton this week in New York as the retailer faces calls for a boycott and a slowdown in foot traffic that began after it walked back key diversity, equity and inclusion programs, the civil rights leader told CNBC Wednesday.
    The meeting, which Target asked for, comes after some civil rights groups urged consumers not to shop at Target in response to the retailer’s decision to cut back on DEI. While Sharpton has not yet called for a boycott of Target, he has supported efforts from others to stop shopping at the retailer’s stores.

    “You can’t have an election come and all of a sudden, change your old positions,” said Sharpton. “If an election determines your commitment to fairness then fine, you have a right to withdraw from us, but then we have a right to withdraw from you.”
    The civil rights leader said he would consider calling for a Target boycott if the company doesn’t confirm its commitment to the Black community and pledge to work with and invest in Black-owned businesses.
    “I said, ‘If [Cornell] wants to have a candid meeting, we’ll meet,'” Sharpton said of the phone call Target made to his office. “I want to first hear what he has to say.”
    A Target spokesman confirmed to CNBC that the company reached out to Sharpton for a meeting and that Cornell will talk to him in New York this week. The company declined further comment.
    In January, Target said it would end its three-year DEI goals, no longer share company reports with external diversity-focused groups like the Human Rights Campaign’s Corporate Equity Index and end specific efforts to get more products from Black- and minority-owned businesses on its shelves. 

    Just days after the announcement, foot traffic at Target stores started to slow down. Since the week of Jan. 27, Target’s foot traffic has declined for 10 straight weeks compared to the year-ago period, according to Placer.ai, an analytics firm that uses anonymized data from mobile devices to estimate overall visits to locations. Target traffic had been up weekly year over year before the week of Jan. 27.
    The metric, which tallies visits to brick-and-mortar locations, does not capture sales in stores or online, but can indicate which retailers are drawing steadier business. While Target has been struggling to grow its sales for months as shoppers watch their spending, the stretch of declining visits came as some civil rights groups and social media users criticized the DEI decision and urged shoppers to spend their money elsewhere.
    Target declined to comment on the figures, saying it doesn’t discuss third-party data.
    At the convention earlier this month for his civil rights organization, the National Action Network, Sharpton said the group would call for a boycott of PepsiCo if the company didn’t agree to meet with the organization within 21 days. In February, the food and beverage company behind brands like Doritos and Mountain Dew announced it would end its DEI workforce representation goals and transition its chief DEI officer role into another position, among other changes.
    This week, leaders from Pepsi met with Sharpton and his team. He did not confirm whether Pepsi made any commitments, but did say it was encouraging that Pepsi’s CEO Ramon Laguarta attended. He added that the two will continue their discussions.
    Sharpton’s meetings with companies including PepsiCo and Target — and his openness to boycotts — mark one of the first meaningful efforts to push back against the war conservative activists like Robby Starbuck have waged on DEI. Starbuck, a movie director-turned-activist, has urged companies to drop DEI policies in part by sharing what he considers unflattering information about their initiatives with his social media followers. He has successfully pressured a wide range of corporate giants to rethink their programs.

    Target joins wider DEI retreat

    With its decision to roll back DEI efforts, the cheap chic retailer Target joined Walmart, McDonald’s, Tractor Supply and a slew of others that scrapped at least some DEI initiatives as they grew concerned that the programs could alienate some customers or land them in the crosshairs of President Donald Trump, who has vowed to end every DEI program across the federal government.
    Target’s decision contrasted with Costco, which shook off pressure from conservative activists to maintain its DEI programs. Shareholders of the membership-based wholesale club soundly rejected a proposal in late January that requested a report on the risks of DEI initiatives.
    NAN has called for so-called “buy-cotts” at Costco, and has brought people to stores in Tennessee, New York and New Jersey. It gave them gift cards to shop with at the warehouse club.
    In the month of March, Target’s store traffic declined 6.5%, while the metric rose 7.5% year over year at Costco, Placer.ai data show.
    Target’s challenges run deeper than DEI backlash, and resistance to its policy change only added to its issues. The discounter’s annual revenue has been roughly flat for four years in a row as it’s struggled to drive consistent sales gains.
    Margins have been under pressure, as consumers buy more of groceries and necessities and less of more profitable categories like home goods and clothing. And the company has pinned its problems on a laundry list of problems in recent years, including having the wrong inventory; losing money from theft, damaged goods and other types of inventory losses; backlash to its collection for Pride Month and pricier costs from rushing shipments.

    ‘What changed?’

    In his meeting with Cornell, Sharpton said he will ask for Target to follow through on pledges it made after police killed George Floyd in the company’s hometown of Minneapolis.
    “You made commitments based on the George Floyd movement … what changed?” said Sharpton. “Are you trying to say … everything’s fine now, because the election changed? That’s insulting to us.”
    In the wake of Floyd’s murder, Cornell said the event moved him.
    “That could have been one of my Target team members,” Cornell said in 2021 at an event hosted by the Economic Club of Chicago, recounting his thoughts as he watched the video of Floyd taking his final breaths.
    At the time, he said it motivated him to step up Target’s efforts to fight racial inequities.
    “We have to be the role models that drive change and our voice is important,” he said at the event. “We’ve got to make sure that we represent our company principles, our values, our company purpose on the issues that are important to our teams.” More

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    UBS loses crown as continental Europe’s most valuable bank to Santander amid U.S. tariffs

    UBS had a market cap of 79.5 Swiss francs ($97.23 billion) as of the Wednesday close, according to FactSet data, with Banco Santander at 91.3 billion euros ($103.78 billion).
    Santander and UBS’ shares have diverged over recent months, with the Swiss lender shedding 17.2% in the year to date, while Santander has gained nearly 35%.
    Both banks have suffered since the imposition of the White House’s protectionist trade policies, given the shrinking growth outlook for tariff-struck European countries and the prospect of a U.S. recession.

    A Santander office building in London.
    Luke MacGregor | Bloomberg via Getty Images

    Spanish lender Banco Santander has eclipsed Swiss giant UBS as continental Europe’s largest bank by market capitalization, as U.S. tariffs ripple through the region’s bruised banking sector.
    UBS — whose share took a deep tumble after the April 2 announcement of U.S. President Donald Trump’s baseline and reciprocal duties on Washington’s trade counterparties — had a market cap of 79.5 Swiss francs ($97.23 billion) as of the Wednesday close, according to FactSet data, with Banco Santander at 91.3 billion euros ($103.78 billion).

    The two banks’ shares have diverged over recent months, with the Swiss lender shedding 17.2% in the year to date, while Banco Santander has gained nearly 35%, according to LSEG data.
    Both banks, along with Europe’s broader banking sector, have suffered since the imposition of the White House’s protectionist trade policies, given the shrinking growth outlook for tariff-struck European countries and the prospect of a recession in the U.S.
    Washington imposed 20% tariffs on imports from the European Union, but has lowered them to 10% under a 90-day pause announced by Trump on April 9.
    Switzerland — which is not a member of the EU — faces a steeper 31% levy after the pause lifts and the Trump administration has also threatened additional duties on imported drugs. This could deliver a blow to the Swiss pharmaceutical industry that “grew robustly” in the fourth quarter and “contributed significantly” to the country’s exports over the period.
    More broadly, European Union banks received a boost from the announcement of the European Union’s ReArm initiative in March, which is set to loosen regional fiscal rules and trigger further borrowing activity to boost defense spending.

    U.S. exposure

    Continental Europe’s two largest lenders have very different exposures to the U.S. market.
    Banco Santander is the fifth-largest auto lender in the country and is expanding through a recent partnership with telecom giant Verizon. Nevertheless, it only logged around 9% of its total profits for 2024 Stateside.

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    European banks

    The U.S. is, meanwhile, a key market for UBS’ lucrative core global wealth management division, with roughly half of the Swiss lender’s invested assets concentrated in the broader Americas region last year, according to its annual report.
    UBS’ outlook has also been clouded by a shroud of uncertainty surrounding potential new — and steeper — capital requirements from Swiss authorities. This follows its expansion in the wake of absorbing collapsed domestic peer Credit Suisse, from which it also inherited a significant U.S. presence. The lender expects to receive further clarity on these guidelines next month.  
    UBS’ profitability could also be impacted by a strong Swiss franc — historically a safe haven asset during market turmoil — which has appreciated by roughly 8% against the U.S. dollar since the imposition of the latest tariffs.
    Switzerland’s appreciating currency — whose strength local trade groups had flagged as damaging to exports even before tariffs came into effect — could, along with depressed inflation in the country, see the Swiss National Bank make further defensive cuts to interest rates, which were already reduced to just 0.25% in March.
    In comparison, the European Central Bank is also widely expected to trim its key deposit facility rate by a quarter point when it meets later on Thursday, although this will take it to 2.25%.
    The potential interest rate cut would take place after the ECB said in March that its monetary policy was “becoming meaningfully less restrictive” — in a signal some analysts interpreted as indicating restraint when it comes to lowering rates further.
    Declines in national interest rates typically weigh on local lenders’ net interest income revenues from loans. More