Finance

A waiter works at a restaurant in Alexandria, Virginia, on June 3, 2022.
Olivier Douliery | AFP | Getty Images

The U.S. payrolls report for May blew past expectations, supported by strong jobs gains in the professional and business services sector — as well as a jump in government employment.
Professional and business services led job creation for the month with 64,000 new hires, following an increase of similar size in April, the Bureau of Labor Statistics said Friday.

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Government added 56,000 jobs last month, higher than the average monthly gain of 42,000 over the prior 12 months. Employment in government is still below its pre-Covid pandemic level by more than 200,000 jobs.

Job gains were broad-based last month with health care contributing 52,000 and leisure and hospitality adding 48,000. Food services and drinking places led the increase in the latter industry, which had been adding an average of 77,000 jobs per month over the prior 12 months.
Overall, the U.S. economy added 339,000 jobs for the month, much better than the 190,000 Dow Jones estimate and marking the 29th straight month of positive job growth.
The unemployment rate rose to 3.7% in May against the estimate for 3.5%. The jobless rate was the highest since October 2022, though still near the lowest since 1969.
Olu Sonola, head of U.S. regional economics at Fitch Ratings, said the jobs report is a mixed bag.
“The strength of the payroll survey is clearly a big surprise, largely on the back of robust job growth in the healthcare sector and the business and professional services sector,” said Sonola. “However, the 0.3% increase in the unemployment rate is the highest monthly increase since April 2020.” More

U.S. authorities claim that UBS and other Swiss banks repeatedly fail to disclose the allegedly criminal activity of clients.
More than half of UBS’s wealth management clients are based in the United States.
UBS is one of roughly 30 global, systemically important banks that regulators protect in emergencies.
UBS may inherit litigation risks after its acquisition of rival bank giant Credit Suisse.

With its $3.2 billion acquisition of Credit Suisse, UBS is poised to climb the ranks of global mega banks.
UBS is no stranger to blockbuster mergers. The modern company is comprised of over 370 legacy firms, including former domestic rivals. Amid major wars, Switzerland has remained stable and neutral, becoming a safe haven for global wealth.

Today, international wealth management is the heart of UBS’s operation. With over $5 trillion in invested assets post-merger, more than half of the bank’s customers are based in the United States. Experts believe this is due to the unique levels of discretion offered by Swiss law. Bankers in Switzerland are bound to protect many client details, even when pressed by foreign authorities. 
“You can access their operations in Singapore, in New York, in more exotic places. But at the core, they will not be subject to some political influence because the Swiss government is leaving them alone, or at least that’s the perception,” said Nicolas Véron, a senior fellow at both the Peterson Institute for International Economics in Washington, D.C., and the Bruegel think tank in Brussels.
In recent years, both UBS and Credit Suisse have faced pressure from U.S. authorities to end what has been criticized as dubious business practices. For example, in the 2010s, thousands of instances of misconduct were uncovered at UBS in an international interest rate manipulation probe. Additionally, U.S. senators claim that Credit Suisse maintained accounts linked to Nazi clients as recently as 2020.
Global watchdogs have worried for years that banks like UBS have become too big to fail. A sudden and rapid flight of depositors from Credit Suisse brought those fears to life. The Swiss National Bank pledged over $100 billion in liquidity support to broker UBS’s rapid takeover of Credit Suisse.
In the deal, Credit Suisse shareholders expect to trade in 22.48 shares for 1 UBS share. Some bondholders plan to challenge the deal in court.

“By and large, what the Swiss government mostly did is impose losses on creditors and shareholders of Credit Suisse,” said Véron.
UBS Group AG said the acquisition may make the bank more competitive globally, and that it is prepared to manage that increased complexity.
Watch the video above to learn more about UBS’s future as Switzerland’s top bank. More

A view of a Canadian athletic apparel retailer Lululemon logo seen at one of their stores.
Alex Tai | LightRocket | Getty Images

Check out the companies making headlines in early morning trading.
MongoDB — The data developer platform stock surged 27% after the company issued a strong forecast for the second quarter, seeing between $388 million and $392 million in revenue. Analysts forecasted $362 million, per Refinitiv. MongoDB also beat earnings and revenue forecasts for the most recent quarter.

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37 minutes ago

SentinelOne  — Shares fell more than 35% in premarket trading after cybersecurity company missed revenue expectations for the first quarter and cut its full-year revenue guidance. The company reported first-quarter revenue of $133.4 million, below the consensus estimate of $136.6 million from FactSet. It sees just $141 million in revenue for the second quarter, well below the $152.1 million consensus estimate from FactSet. The company said in a shareholder letter that macroeconomic pressure was slowing sales growth.
Lululemon — The athleisure company’s shares jumped more than 14% after it reported a top and bottom line beat in its fiscal first quarter. The company’s sales grew 24% from the previous year. Lululemon also raised its full-year outlook.
Dupont De Nemours — Shares of the chemicals products maker gained 3% in early morning trading after the company, along with The Chemours Company and Corteva, reached a settlement with U.S. Water Systems to resolve all claims related to per- and polyfluoroalkyl substances, also known as PFAS, in drinking water. The companies will collectively contribute $1.185 billion to a settlement fund. Chemours rose about 2%. Corteva was higher by less than 1%.
Trade Desk — The online ad company saw its shares rise more than 3% after Morgan Stanley upgraded the stock to overweight from equal-weight. The Wall Street firm said The Trade Desk is a top pick set to thrive in a stabilizing market for sales. Its $90 price target represents a more than 20% upside for the stock.
Tesla — Shares of the EV maker rose more than 1% following a Bloomberg report that China is considering extending tax exemption for cheaper electric cars for another four years.

Samsara — The cloud company for the industrials industry saw shares jump nearly 14% after it posted a smaller-than-expected first-quarter loss and better-than expected revenue, according to FactSet, and expanded its full-year sales guidance.
ChargePoint — The electric vehicle charging stock slid 5.5% after the company issued light guidance for the current quarter. ChargePoint said revenue would be between $148 million and $158 million this quarter, below the consensus estimate of $165.6 million from FactSet.
Five Below —  The discount retailer’s shares got a 3.5% boost in early morning trading following mixed results for the latest quarter, including earnings per share that beat estimates by 4 cents, according to Refinitiv.
PagerDuty — PagerDuty shares fell nearly 16% after the cloud computing company issued weaker-than-expected revenue guidance. The company said revenue this quarter would be only as much as $105.5 million, compared to a consensus estimate from analysts of $108.8 million, according to FactSet.
Asana — Shares advanced more than 6% premarket after the work management platform operator reported a smaller-than-expected loss and revenue that beat analyst expectations in the first quarter. Asana’s revenue last period was $152.4 million,compared to the analyst consensus of $150.5 million from FactSet.
 — CNBC’s Hakyung Kim, Jesse Pound and Yun Li contributed reporting More

For a third-straight month, Li Auto’s deliveries topped 20,000 with a climb to 28,277 vehicles in May, according to a release Thursday. That’s up by about 146% from a year ago.
Competitors Nio and Xpeng both reported a year-over-year drop in monthly deliveries.
Those figures are still only a fraction of the market versus industry giants Tesla and BYD.

A Li Auto store inside a shopping mall in Yantai, Shandong province on May 6, 2023.
Future Publishing | Future Publishing | Getty Images

BEIJING — Chinese electric car startup Li Auto said it delivered more than twice as many cars in May versus a year ago.
For a third-straight month, Li Auto’s deliveries topped 20,000 with a climb to 28,277 vehicles in May, according to a release Thursday. That’s up by about 146% from a year ago.

In contrast, competitors Nio and Xpeng both reported a year-over-year drop in monthly deliveries.
Li Auto differs from the two startups in that its electric cars come with a fuel tank for charging the battery and extending driving range.
That divergence comes as China’s fast-growing electric car market grows more competitive.
Average selling price is down by about 10% to 15% across brands, Bank of America Securities’ head of Asia Pacific basic materials, Matty Zhao said Friday on CNBC’s “Street Signs Asia.”
She expects China’s electric car market to grow by 27% this year to 8.7 million units, with penetration of overall auto sales set to grow to 32% this year, versus 26% last year.

Some brands, such as Xpeng, are trying to compete by selling advanced assisted driving technology.
Xpeng said it delivered 7,506 electric cars in May, up by a few hundred from April. The company said its P7i sedan saw a “substantial increase” in deliveries.
Last week, management said wait times for P7i orders was more than six weeks due to production delays, which they expected would improve in June. The company projected a significant increase in overall deliveries to more than 20,000 vehicles a month in the fourth quarter.
Nio delivered 6,155 cars in May, down from April and a year ago. The company is set to release quarterly earnings on June 9.
Based on Li Auto’s reported and forecast deliveries, the company expects to deliver at least 22,000 vehicles in June.
Those monthly deliveries are still only a fraction of the market compared with industry giants Tesla and BYD.

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Three U.S.-listed Chinese electric car startups.

BYD said it sold 239,092 passenger vehicles in May, doubling compared with a year ago. About half were purely battery-powered, while the other half were hybrids.
Tesla sold nearly 40,000 cars to consumers in China in April, according to the latest figures available from the China Passenger Car Association. That’s up from the year-ago period which saw few electric car sales due to Covid controls that locked down Shanghai, where Tesla’s factory in China is located.
Tesla CEO Elon Musk visited Beijing and Shanghai this week for the first time in more than three years. More

A Lululemon sign is seen at a shopping mall in San Diego, California, November, 23, 2022.
Mike Blake | Reuters

Check out the companies making headlines after the bell.
Lululemon — Lululemon’s stock popped 12% after the athletics apparel retailer posted better-than-expected fiscal first-quarter earnings and lifted its full-year guidance. The company also reported 24% sales growth from the year-ago period.

MongoDB — Shares of MongoDB jumped 19%. The data developer platform posted blowout guidance. MongoDB anticipates revenue in the second quarter will range between $388 million and $392 million, compared to analysts’ forecasts of $362 million, per Refinitiv. MongoDB beat on top and bottom lines in its latest quarterly report.
Five Below — Shares of the discount store chain jumped 6% in extended trading. Five Below posted earnings of 67 cents per share, while analysts polled by Refinitiv estimated earnings of 63 cents a share. However, Five Below posted revenue of $726 million, compared with Wall Street’s forecast of $728 million. Second-quarter guidance was also short of analysts’ expectations.
Broadcom — The chip stock fell nearly 1% in extended trading. Broadcom reported a beat on the top and bottom lines for its second quarter and fiscal third-quarter revenue guidance that came in slightly ahead of Wall Street’s expectations. The stock had risen 41% going into the report.
PagerDuty — Shares of the digital operations management company slumped more than 11% after the bell. PagerDuty reported adjusted earnings per share that beat Wall Street’s estimates, but issued weaker-than-expected revenue guidance.
Asana — Shares of the work management platform operator gained 2% postmarket. Asana reported a smaller-than-expected loss and revenue that beat analyst expectations in the first quarter, according to FactSet.

Samsara — Samsara’s stock popped 13% in extended trading after the Internet of Things company reported a smaller-than-expected first-quarter loss, according to FactSet. Revenue also came in ahead of Wall Street’s estimates, while full-year sales guidance expanded.
ChargePoint — ChargePoint shares slumped more than 4% in extended trading. The electric vehicle charging stock beat Wall Street’s earnings expectations but shared light guidance for the current quarter that was below consensus estimates.
SentinelOne — SentinelOne shares cratered 34% after the bell as the cybersecurity company cut its revenue guidance and fell short of Wall Street’s revenue expectations in the most recent period.
— CNBC’s Darla Mercado contributed reporting. More

A sign is posted in front of a Dollar General store in Vallejo, California, March 17, 2022.
Justin Sullivan | Getty Images

Check out the companies making the biggest moves midday.
Dollar General — Shares sank nearly 20% after the company reported an earnings and revenue miss for the first quarter. The company also slashed its full-year outlook, citing a macroeconomic environment that is more challenged than it had expected.

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NetApp — Shares popped 9.5% following the company’s earnings and revenue beat after the close Wednesday. Adjusted earnings per share came in at $1.54 for its fiscal fourth quarter, versus the $1.25 expected from analysts polled by StreetAccount. Revenue was $1.58 billion, versus the $1.54 billion anticipated.
Chewy — The pet retailer’s stock surged about 25% after the company posted earnings per share of 5 cents, topping the 4-cent loss expected from analysts polled by Refinitiv. Chewy also beat on revenue. Its second-quarter revenue guidance also beat expectations, per StreetAccount.
Hormel Foods — The food producer’s stock gained 5.1% after the company reported fiscal second-quarter earnings per share of 40 cents, slightly above the 39 cents expected, per StreetAccount. However, revenue came in lighter than anticipated. Hormel also said it made progress on inventory levels and saw “meaningful improvement in fill rates.”
Pure Storage — The stock soared 21% on better-than-expected quarterly earnings and revenue. Pure Storage’s revenue guidance for the second quarter also topped estimates, per StreetAccount.
PVH — Shares tumbled 10% despite the company’s earnings and revenue beat after Wednesday’s close. Its full-year outlook was in line with consensus, but its second-quarter GAAP earnings-per-share guidance of $1.70 was below the $2.26 expected, per StreetAccount.

CrowdStrike — The cybersecurity stock lost 2% after the company reported quarterly results that showed slowing revenue growth.
Victoria’s Secret — Shares tumbled 8% after the lingerie retailer reported an earnings and revenue miss. The company also reduced its full-year revenue guidance in the low single-digits range from the prior midsingle-digit range estimates.
C3.ai — The artificial intelligence company dove 14% as a weaker-than-expected outlook eclipsed stronger-than-expected earnings for the previous quarter. The stock is still up sharply this year as investors bet on AI.
Salesforce — Salesforce shares lost about 4%. The drop in shares came as cost concerns and dwindling demand for consulting deals overshadowed better-than-expected results and an improved full-year earnings outlook.
Okta — The stock sank more than 18%. While the cloud software company lifted guidance for the 2024 fiscal year, management said “macroeconomic pressures are increasing.” JPMorgan Chase downgraded the stock to neutral from overweight Thursday.
Veeva Systems — The computer application company’s shares surged more than 18% after Veeva posted better-than-expected earnings and revenue for the first quarter late Wednesday. The company also raised its full-year earnings per share guidance.
Lucid Group — The luxury electric vehicle maker saw its shares drop 14% after it said Wednesday it’s raising about $3 billion through a new stock offering, and some $1.8 billion of the raise will come from a private placement with Saudi Arabia’s Public Investment Fund, which owns about 60% of the company.
bluebird bio — The biotech stock rose 4.9% following an upgrade to overweight from equal weight by Barclays. The firm said the company has several positive clinical trials on the horizon.
— CNBC’s Samantha Subin, Yun Li, Alex Harring and Tanaya Macheel contributed reporting. More

People walk past Macy’s on January 26, 2023 in New York City. US gross domestic product increased at an annual rate of 2.9% in the fourth quarter of 2022.
Leonardo Munoz | Corbis News | Getty Images

Check out the companies making headlines before the bell.
Nordstrom — Shares rose 4.7% after Nordstrom’s first-quarter results topped Wall Street’s expectations. The company posted 7 cents earnings per share and revenue of $3.18 billion. Analysts had estimated a loss per share of 10 cents and $3.12 billion in revenue, according to StreetAccount.

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2 hours ago

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C3.ai — The artificial intelligence company sank 21% after sharing disappointing guidance for the fiscal first quarter. That overshadowed a smaller-than-expected loss for the fiscal fourth quarter.
Salesforce — The software giant’s shares fell 6% after the company reported higher-than-expected capital costs and lower demand for consulting deals in its fiscal first quarter.
Okta — The cloud software company’s shares tumbled more than 20% Thursday. While Okta’s first-quarter results came above consensus analyst estimates, decelerating subscription revenue growth and smaller deal sizes from a worsening macro environment worsened investor sentiment. BMO Capital Markets downgraded shares to market perform from outperform in a Thursday note. 
Macy’s – Shares of the retail giant slid 7% premarket after the company missed revenue estimates for its most recent quarter, according to Refinitiv. Macy’s also slashed its full-year earnings and sales guidance, after “demand trends weakened” for discretionary items in March.
Lucid Group – The luxury EV maker saw its shares drop 12.5% after it said it’s raising about $3 billion through a new stock offering. It added that some $1.8 billion of the raise will come from a private placement with Saudi Arabia’s Public Investment Fund, which owns about 60% of the company.

Chewy — Shares jumped 17% after the pet products e-commerce company reported an earnings and revenue beat for the first quarter. The company also raised its full-year guidance and announced plans for expansion to Canada in the third quarter. 
Dollar General — Shares tumbled 9% after the company reported an earnings and revenue miss for the first quarter. The company said the macroeconomic environment is more challenged than it had previously anticipated and reduced its number of expected new store openings. 
CrowdStrike — Shares of the cybersecurity company fell 10% despite CrowdStrike’s first-quarter results beating analyst expectations. Sales reported 57 cents in adjusted earnings per share on $693 million of revenue. Analysts surveyed by Refinitiv were expecting 51 cents per share and $676 million per share. Several Wall Street analysts highlighted a slowdown in annual recurring revenue growth as a negative for the quarter.
Target — Shares traded down 1.4% after JPMorgan downgraded them to neutral from overweight. The bank cited several factors, including a weakening consumer spending environment, ongoing share losses from recent controversies and grocery inflation headwinds. 
Victoria’s Secret — The stock fell 13.6% after the company reported a quarterly earnings and revenue miss. The lingerie retailer reduced its full-year revenue guidance in the low-single digits range from the prior mid-single digit range estimates. 
CSX — Shares added 1.5% in premarket trading following an upgrade by UBS to buy from neutral. The Wall Street firm cited CSX’s strong network operation, which it believes will provide leverage to the next volume upturn. UBS also raised its price target to $37 from $33, suggesting nearly 21% upside from Wednesday’s close.
Veeva Systems – The computer application company got a 9% boost in its stock price after it posted better-than-expected earnings and revenue for the first quarter. Veeva also raised its full-year earnings per share guidance by 26 cents.
Pure Storage — Shares rallied 5% following a better-than-expected first quarter earnings report. The company’s full-year revenue guidance also topped analysts’ estimates.
— CNBC’s Tanaya Macheel, Samantha Subin, Jesse Pound and Michelle Fox contributed reporting More

China’s post-covid recovery was supposed to be world-shaking. Instead, it looks merely shaky. After the initial release of pent-up demand, economic data for April fell short of expectations. In response China’s stocks faltered, yields on government bonds fell and the currency declined. The country’s trade-weighted exchange rate is now as weak as it was in November, when officials were locking down cities. Will the data for May look better? On the last day of the month the National Bureau of Statistics reported its purchasing-managers indices (pmis). They showed that services output grew more slowly than in April and manufacturing activity shrank for the second month in a row. Another manufacturing index by Caixin, a business publication, was more encouraging, perhaps because it gives smaller weight to inland heavy industry, which may benefit less from a consumption-led recovery. Both sets of pmis also suggest the prices manufacturers pay for inputs and charge for outputs have declined. Some economists now think producer prices—those charged at the “factory gate”—may have fallen by more than 4% in May, compared with a year ago. Such price cuts are hurting industrial profits, which is in turn hampering manufacturing investment. This has raised fears of a deflationary spiral.As a result, China’s economy faces the growing risk of a “double dip”, says Ting Lu of Nomura, a bank. Growth from one quarter to the next may fall close to zero, even if headline growth, which compares gdp with a year earlier, remains respectable.Elsewhere in the world, weak growth is accompanied by uncomfortable inflation. This makes it harder for policymakers to know what to do. But China’s problems of faltering growth and falling inflation point in the same direction: towards easier monetary policy and a looser fiscal stance. Some investors worry that China’s government is not worried enough. The central bank seems unconcerned about deflation. Even without much stimulus, the government is likely to meet its modest growth target of 5% this year, simply because the economy last year was so weak. That stance will change soon, predicts Robin Xing of Morgan Stanley, a bank. In 2015 and 2019, he points out, policymakers were quick to respond when the manufacturing pmi fell below 50 for a few months. He is confident China’s central bank will cut reserve requirements for banks in July, if not before. He also thinks China’s policy banks, which lend in support of development objectives, will increase credit for infrastructure investment. That should be enough to make the slowdown a “hiccup”.Others are less optimistic. The government will act, argues Mr Lu, but small tweaks will not lift the gloom for long. A bigger response faces other obstacles. Officials could cut interest rates, but that would squeeze the profitability of banks which must already worry about losses on property loans. They could transfer more money to local governments, but many have misspent funds on ill-conceived infrastructure in the past. They could hand out cash directly to households, but creating the apparatus to do so would take time. In the past, the government could quickly stimulate the economy through property and infrastructure investment. Since then, notes Mr Lu, its “toolbox has become smaller and smaller”. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More