Finance

Magnifi uses ChatGPT and computer programs to provide personalized, data-driven investment advice.
“It’s a copilot for the self-directed investor,” said Vinay Nair, founder of Magnifi. “Magnifi is trying to democratize intelligence in a personalized way.”
It also performs like a brokerage where you can directly trade stocks and ETFs.

Sompong_tom | Istock | Getty Images

Applying artificial intelligence to the world of finance is all the rage, and a new investing platform just took it to another level.
Magnifi is one of the first investing platforms that uses ChatGPT and computer programs to provide personalized, data-driven investment advice. Not only does It answer investor questions in human-like conversations, it also monitors individual portfolios, guiding users through market-moving events like rate hikes and earnings reports. And there’s a bonus — it performs like a brokerage where you can directly trade stocks and ETFs.

“It’s a copilot for the self-directed investor,” Vinay Nair, founder of Magnifi, said in an interview. “Today brokerages have democratized access to trading, to markets, but they lack intelligence and they lack personalization for the user. Magnifi is trying to democratize intelligence in a personalized way.”
As AI continues to make breakthroughs, Wall Street gets increasingly curious how the technology could disrupt the asset management business. A recent preliminary study showed that ChatGPT, the hottest AI tool in the world, could have the potential to improve investment decision making.
To see how Magnifi performs and how it competes with professional advisers, I asked it a few different questions.
First, I posed the question “what stocks would Warren Buffett buy?” It came back with an explanation of his value investing principle along with the “Oracle of Omaha’s” biggest holdings, Bank of America, Apple and Coca-Cola.

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Then the system was able to compare these three stocks in terms of return and volatility over the past year.

Secondly, I wanted to see how Magnifi would help me navigate the earnings season. I asked it what would happen to a hypothetical Amazon holding when the e-commerce retailer reports earnings.

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The robot showed me the earnings estimates from Wall Street analysts as well as Amazon’s track record in the last few quarters.
Finally, I asked how rate hikes are affecting my imaginary portfolio, with iShares 20 Plus Year Treasury Bond ETF as one of my holdings. It told me that rising rates can have a negative impact on bond funds such as TLT, with examples of historical performance in similar environments.

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Nair said many investors tend to ask questions as generic as “how do I get started?” But the more users engage, the more inputs the system can collect and the more personalized answers it can provide, the founder said.
The platform charges a $14 flat fee per month, and Nair said his company doesn’t make money from trading, or payment for order flows.
“It’s a very customer aligned model, which gives us no incentives to get them to trade too much, directly or indirectly,” Nair said. More

Wholesale egg prices, which retailers pay to suppliers, are falling quickly.
They were at $1.22 a dozen on April 26, according to Urner Barry data. That’s down from a record $5.46 in December.
Prices jumped when a historic and deadly outbreak of bird flu in the U.S. ran headlong into peak demand around the winter holidays.
Supply and demand pressures have eased. But retailers have discretion to pass (or not pass) savings on to consumers.

Grace Cary | Moment | Getty Images

Wholesale egg prices are poised to fall to $1 a dozen in coming weeks — the lowest level in almost two years — as prices undergo a dramatic retreat from record highs over the winter.
Wholesale prices — which retailers like grocery stores pay to egg distributors — were at $1.22 a dozen as of April 26, according to Urner Barry, a market research firm. Its Midwest Large White Egg price benchmark is a widely cited barometer in the egg industry.

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That’s down from a record $5.46 in December and $3.54 around the Easter holiday, both seasonal periods of high consumer demand. In all, prices have decreased by 78% in about five months.
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They could soon dip below $1 a dozen if the trend holds, said Karyn Rispoli, who heads up egg market coverage at Urner Barry. It would be the first time since July 2021.
“It’s been all down [since Easter],” Rispoli said of the wholesale price. “It’s certainly been undergoing a very sharp correction.”

Why egg prices jumped and then fell

Egg prices were a standout in 2022, a year in which inflation was high for many consumer goods and services.

Egg supply was crimped by a historic outbreak of bird flu in the U.S., which killed millions of egg-laying hens. The impact of that supply reduction was exacerbated by the winter holidays, when egg demand typically peaks each year.   
Now, there’s been a reversal.

Retailers really have carte blanche to do what they want with their pricing.

Karyn Rispoli
head of egg market coverage at Urner Barry

There haven’t been new cases of bird flu detected at commercial egg farms since December, allowing egg supply to rebound, said Brian Moscogiuri, global trade strategist at Eggs Unlimited, a supplier. Meanwhile, consumer demand is typically weak around this time of year, he said.
“Prices have collapsed beyond the expectation of the industry at this point,” Moscogiuri said.
Retail prices — which consumers pay at the store — tend to lag wholesale price trends. But the extent of consumers’ future savings on a carton of eggs is unclear, since retailers have discretion to set their shelf prices.

“Retailers really have carte blanche to do what they want with their pricing,” Rispoli said.
The average consumer paid $3.45 for a dozen large, Grade A eggs in March, according to federal data. That’s down from a record $4.82 in January but up from $2.05 a year earlier.  
“All of a sudden, you might have eggs at a dollar or $1.69 [a dozen] again,” especially if retailers advertise eggs as a loss leader to get consumers in the store, Moscogiuri said.
However, some may try to recoup any financial losses on eggs from the winter months, in which case they may not readily pass along cost savings reaped at the wholesale level, he added. More

Southwest Airlines planes sit idle on the tarmac after Southwest Airlines flights resumed following the lifting of a brief nationwide stoppage caused by an internal technical issue, according to the U.S. Federal Aviation Authority (FAA), at Chicago Midway International Airport in Chicago, Illinois, April 18, 2023.
Jim Vondruska | Reuters

Check out the companies making headlines in midday trading.
Honeywell International —  Shares climbed 3.2% after Honeywell exceeded expectations on the top and bottom lines in its latest quarter. The conglomerate reported adjusted first-quarter earnings of $2.07 per share on revenues of $8.86 billion. Analysts polled by Refinitiv forecasted earnings per share of $1.93 on revenues of $8.52 billion.

Fidelity National Information Services — The financial products company’s stock climbed 3.5% on the back of better-than-expected first-quarter results. Fidelity National earned an adjusted $1.29 per share on revenue of $3.51 billion. Analysts polled by StreetAccount expected a profit of $1.21 on revenue of $3.41 billion.
Southwest Airlines — The airline company’s shares slipped 3.4% following a wider-than-expected loss for the first quarter. The carrier had a meltdown in the final days of December, when it canceled more than 16,000 flights in late December. The incident resulted in a $325 million revenue impact for the first quarter, Southwest said.
Caterpillar – Shares of the construction-equipment manufacturer lost 2.4% the company released its quarterly earnings report. Caterpillar earned an adjusted $4.91 a share last quarter, above the $3.78 that was expected, according to the Refinitiv consensus. Revenue of $15.86 billion also topped expectations.  
C.H. Robinson Worldwide — The transportation company gained 8.1%. C.H. Robinson reported an earnings miss on Wednesday, with an adjusted 98 cents per share and $4.61 billion in revenue against estimates of 99 cents and $4.78 billion, according to data compiled by FactSet.
First Republic Bank – The regional bank’s stock rallied 13.1% after tumbling nearly 30% during Wednesday’s session. The slide came as the bank looked for a potential rescue deal.

Teladoc Health — Shares of the telemedicine company jumped more than 6% after the firm reported a revenue beat for the latest quarter. The company also raised the low end of its revenue and adjusted EBITDA guidance. The firm did post a wider than expected loss for the quarter, however.
Hasbro — The toy and entertainment conglomerate saw its stock soar 12.7% after the company’s quarterly revenue beat Wall Street estimates. The result was boosted by a 16% jump in revenue from its “Magic: The Gathering” tabletop and digital game. Jefferies reiterated its buy rating on Hasbro Thursday, seeing big gains thanks to the growth of the game.
AbbVie — Shares shed 8% after reporting an earnings miss in the first quarter. The pharmaceutical company posted adjusted earnings per share of $2.46, while analysts had estimated $2.51, according to StreetAccount. 
Comcast – The media conglomerate was up 3.5% after it posted better-than-expected earnings in the first quarter. To be sure, the company reported losses for its Peacock streaming service and a drop in residential broadband subscribers.
Align Technology — Align Technology slid 11.2%. The selloff comes even after the Invisalign maker’s first-quarter earnings and revenue topped expectations. Stifel reiterated a buy rating on the Invisalign maker following the results, but noted investors “wanted more” from the quarterly results. Align shares are up more than 48% this year.
Meta — The Mark Zuckerberg-helmed social media company gained nearly 15%. Meta rallied after reporting an earnings beat a day earlier. The company also noted plans to further investments in artificial intelligence, and Zuckerberg highlighted Meta’s commitment to efficiency going forward. Analysts at some of the biggest firms on Wall Street raised target prices for Meta stock on the report.
eBay  – Shares gained 3.9% after the e-commerce company’s first-quarter earnings and revenue topped expectations. EBay posted per-share earnings of $1.11, better than a StreetAccount consensus estimate of $1.07. The company’s revenue of $2.51 billion was also above expectations.
Domino’s — The pizza chain lost 5.7% on the back of mixed quarterly results. The company’s profit of $2.93 per share beat a StreetAccount estimate of $2.72 per share. However, revenue came in roughly in line at $1.02 billion.
United Rentals — Shares fell 5.7% after the company’s first-quarter earnings came in below expectations. United Rentals also reaffirmed its full-year guidance.
Pentair — The water industrial manufacturing company surged 7.6% after reporting an earnings and revenue beat for the first quarter. The company also raised its second-quarter and full-year guidance.
CBRE — Shares of the real estate group soared 8.8% after CBRE’s first-quarter earnings announcement buoyed investor sentiment. The company reported 92 cents earnings per share and revenue of $7.41 billion. Meanwhile, analysts had expected 86 cents earnings per share and $7.09 billion in revenue, per StreetAccount. 
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
— CNBC’s Brian Evans, Yun Li, Alex Harring and contributed reporting More

Harley-Davidson motorcycles are displayed for sale at the Cowboy Harley-Davidson dealership on February 02, 2023 in Austin, Texas.
Brandon Bell | Getty Images

Check out the companies making headlines before the bell:
Meta Platforms – Shares jumped 12% after the Facebook parent surpassed Wall Street’s expectations on the top and bottom lines and issued optimistic guidance. Meta Platforms posted its first sales increase in about a year.

Teladoc Health – The telemedicine company saw its stock soar more than 7% after revenue topped analyst estimates in the latest quarter. The company also raised the low end of its revenue and adjusted EBITDA guidance, although it posted a wider-than-anticipated loss in the latest quarter. DA Davidson cited stable results and increasing confidence after Teladoc’s earnings.
Harley-Davidson – Harley-Davidson jumped 4.4% after the motorcycle maker topped earnings and revenue expectations, according to consensus estimates from Refinitiv. HOG reported first quarter earnings of $2.04 per share versus an estimate of $1.39, on revenues of $1.56 billion that were above the consensus $1.36 billion.
First Republic Bank – The San Francisco-based lender rose 3% premarket after tumbling nearly 30% during Wednesday’s session. The slide came as the bank looked for a potential rescue deal.
KLA Corporation – The semiconductor equipment maker added 3% after KLA’s latest fiscal third quarter results beat estimates on the top and bottom lines, according to consensus estimates from FactSet. 
Ebay – The e-commerce platform jumped 3% after first-quarter earnings and revenue topped expectations, and it issued better-than-expected guidance. Ebay reported earnings of $1.11 per share, better than analysts’ $1.07 consensus, on revenue of $2.51 billion that was above Wall Street’s $2.48 billion estimate. 

Eli Lilly and Company – Shares of the Indianapolis-based drugmaker rose more than 3% after it reported higher-than-expected revenue for the first quarter and raised its full-year guidance on both the top and bottom lines. Lilly generated $6.96 billion in revenue, topping the $6.86 billion expected by analysts, according to Refinitiv. Adjusted earnings per share, however, came in 11 cents below estimates at $1.62.
Southwest Airlines – The Dallas-based carrier saw its shares slide 4% after posting a wider-than-expected loss for the first quarter as a result of its holiday crisis, when it canceled more than 16,000 flights in late December. The incident resulted in a $325 million revenue impact for the first quarter, Southwest said.
Roku – Shares climbed 1.8% after Roku’s first-quarter revenue beat expectations, and it issued second-quarter revenue guidance beyond what Wall Street was anticipating. The TV streaming platform said latest quarter revenue came in at $741 million, far better than the $708.5 million consensus estimate, according to Refinitiv. Roku issued second-quarter revenue guidance of $770 million, better than analysts’ consensus of $768 million. Otherwise, Roku slightly missed earnings expectations in the quarter just ended, losing $1.38 per share compared to forecasts for a loss of $1.37 per share. 
Honeywell International – Honeywell advanced 1.8% after surpassing earnings and revenue expectations in its latest quarter. The conglomerate reported first quarter earnings of $2.07 per share ex-items, better than Wall Street’s $1.93, on revenues of $8.86 billion that topped the consensus of $8.52 billion.
American Airlines – The Fort Worth, Texas-based carrier rose 0.4% premarket after posting first-quarter earnings that matched estimates, though revenue missed expectations. American posted first quarter earnings of $0.05 per share ex-items, in line with Wall Street, on revenues of $12.19 billion that compared with analysts’ $12.20 billion.
Merck & Co. – The New Jersey-based pharmaceutical maker advanced about 1.5% after topping estimates in its most recent quarter. Merck reported first quarter earnings of $1.40 per share ex-items, better than analysts’ $1.32 estimate, on revenues of $14.49 billion that topped the consensus $13.78 billion, according to Refinitiv.
Northrop Grumman – The defense contractor rose 1.6% after first quarter earnings of $5.50 a share ex-items topped analysts’ $5.09 estimate, according to Refinitiv, while revenue of $9.3 billion was above the consensus of $9.173 billion.
Caterpillar – The construction-equipment maker earned an adjusted $4.91 a share last quarter, above the $3.78 that was expected, according to the Refinitiv consensus, on revenue of $15.86 billion versus an estimate of $15.255 billion. Caterpillar shares dipped 0.1% in early trading. 
Bristol-Myers Squibb Company – Bristol Myers posted earnings of $2.05 per share ex-items in the latest quarter, better than forecasts for $1.97 per share, according to Refinitiv. Revenue of $11.34 billion missed expectations of $11.49 billion. The stock gained 0.1% premarket. 
Comcast – Shares of the media conglomerate rose 3.5% premarket trading after it posted better-than-expected earnings in the first quarter, according to Refinitiv, despite losses at the Peacock streaming service and a drop in residential broadband subscribers. Comcast owns NBCUniversal, the parent company of CNBC.
ServiceNow – Shares declined 1.1% premarket after a 17% runup year-to-date entering its latest earnings. The cloud computing provider earned of $2.37 per share ex-items in the latest quarter, better than Wall Street’s $2.04, on revenue of $2.10 billion versus analysts’ consensus of $2.08 billion, according to Refinitiv.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
— CNBC’s Yun Li, Tanaya Macheel, Jesse Pound and Samantha Subin contributed reporting. More

The choppy waters of commodity trading have claimed another victim. On April 23rd it emerged that ING, a Dutch lender, was suing ICBC, China’s biggest bank. ING accuses ICBC of releasing export documents to Maike, a trader that once handled a quarter of China’s copper imports, without first collecting payment owed to ING. Shortly after this Maike ran out of cash, sinking hope of recouping the money. Now ING is seeking $170m from ICBC for its alleged error. Such disputes are becoming painfully common in the industry responsible for ferrying food, fuel and metals around the world. Last year traders stopped supplying a Chinese metals merchant after $500m-worth of copper went AWOL. In February Trafigura, a trading giant, booked $600m in losses after discovering that cargoes of nickel it had bought were in fact worthless stones. Last month the London Metals Exchange (lme) found bags of stone instead of nickel at one of its warehouses. The 40-odd banks that finance the bulk of the $5.5trn-worth of raw materials which travel the globe every year are often on the losing end of such scandals. France’s Natixis and Italy’s UniCredit were among those fooled in 2020 when Gulf Petrochem, a now-defunct trader, misdelivered oil, before fleeing creditors. JPMorgan Chase is the unlucky owner of the 54 tonnes of fake nickel found by the lme. Commodity trading has long been vulnerable to foul play. Unlike manufactured goods, such as cars or smartphones, common raw materials are priced according to public benchmarks. These can move far and fast, wrong-footing traders; the widespread use of financial instruments to hedge against, or speculate on, price movements can magnify losses. Commodity trading is full of obscure middlemen, sheltered in countries with lax policing, that have little reputation to lose. Lately there have been wild swings aplenty. In April 2020, as lockdowns sapped demand for energy, the collapse of Hin Leong, a Singapore-based oil trader accused of fraud, left 23 banks on the hook for $3.9bn. Last year Maike used its pricey copper to raise funds to bet on Chinese property—shortly before zero-covid policies and debt rationing strangled the sector. Rising prices for fuels and metals seem to have made trickery all the more appealing. More frequent scandals, and stricter rules on risky lending in rich countries, have prompted a few banks to backtrack. ABN Amro, a Dutch lender, quit commodity-trade finance in 2020. BNP Paribas and Rabobank have trimmed their portfolios. Yet instead of retreating, most big banks have refocused on the larger traders. Trafigura, which borrows from some 140 banks, increased its credit lines by $7bn to $73bn last year. Meanwhile, smaller firms in countries for which commodities trading is bread-and-butter, such as Switzerland, where the industry employs 10,000 people, can still find enough working capital to go on, notes Jean-François Lambert, an industry consultant. Singapore’s three main banks remain active lenders, too. Commodity-trade finance will only get more alluring. The industry is growing fast and ever hungrier for capital. Its aggregate gross margin has doubled since 2009, when markets boomed, to a record $115bn. McKinsey, a consultancy, estimates that volatile commodity prices, rising interest rates and longer shipping times will push traders to look for an extra $300bn-500bn in working capital between 2021 and 2024. For many governments, worried about the supply of raw materials, commodity trading has become strategic. Earlier this year Germany and Italy said they would guarantee loans to Trafigura, lowering risk for its creditors. Local midsized banks are pondering an entry, says an industry veteran. Existing players are upping their game as well. In January Standard Chartered named its first commodity-trade chief. Last year Mitsubishi bought BNP’s American commodity-finance arm. Years of volatility bode well for the big traders—and few banks are willing to miss the boat. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More

After Russia invaded in February last year, Ukraine’s finance minister, Serhiy Marchenko, braced, logically enough, for government revenues to “plummet”. He says he expected them to fall by roughly as much as economic activity. That did not happen. Although Ukraine’s gdp plunged by 29% in 2022, the state pulled in just 14% less than the year before.The war has led to big drops in tax revenues from imports and tourism. Blackouts caused by Russian attacks on power plants and the grid, which began in earnest in October, disrupt automated reporting of taxable transactions. What, then, is behind the state’s “unique results”, as an official puts it, in wartime revenue collection?One explanation is that firms and taxpayers, eager to support their country’s defence, are paying more tax than required. According to Ukraine’s finance ministry, in March last year such donations came to 26bn hryvnias ($880m), rising to 28bn in May. These are considerable sums. Estimates vary, but last year Ukraine’s total revenues, excluding donations, perhaps amounted to some $37bn, reckons Maksym Dudnyk, a tax partner at pwc, who shuttles between the consultancy’s offices in Warsaw and Kyiv. Widespread thinking, he says, goes like this: if Ukraine wins, you’ve got your country; if Russia wins, thuggish authorities will take your money anyway, so why not help out now?Many Ukrainians are also paying their taxes early. Constantin Solyar of Asters, a law firm in Kyiv, recounts a meeting with a client shortly after Russia’s onslaught began. When the client asked how his company could go about prepaying taxes, Mr Solyar was so moved he could “barely hold my tears”. This sort of early payment has since become normal. A year or so on, Mr Dudnyk says that nearly all the 100-odd clients he serves have begun to prepay.As Illya Sverdlov of Kinstellar, another law firm, points out, doing so is not entirely altruistic: it also generates good pr, with some companies trumpeting the gesture in the media. But plenty are chipping in quietly, too. The conflict has even led some Ukrainians who have lived abroad for years and who are not public figures to begin paying taxes back home, says Mr Solyar. Efforts to seek loopholes to lower tax bills appear to have decreased.Perhaps most astonishingly, the State Tax Service of Ukraine continues to receive payments, through its online portal, from occupied territories (albeit not from Crimea, where Russia’s grip is strongest). For people in such areas, the pressure to pay Russian taxes is enormous, says Mr Marchenko, Ukraine’s finance minister. Lots of local businesses must also grease the palms of Russian commanders and militias to get permission to keep operating. Even so, last year 2.3m individuals and organisations in occupied areas paid $9.5bn in taxes to Ukraine. They are braving the risk of retribution from Russian “punishers”, who have a fondness for brutality.Yet patriotism is not the only reason for higher-than-expected tax revenues. Levies on gas production rose early last year. Danil Getmantsev, chair of the Ukrainian parliament’s Committee on Finance, Taxation and Customs Policy, also points to a crackdown on corruption that has included the dismissal of many tax officials. That effort may have something to do with the increased scrutiny of Ukraine’s governance from Western donors. Even in a time of war, the taxman must still do his job. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More

When America unshackled its economy from pandemic-era restrictions two years ago, it also unlocked inflation. By mid-2021, consumer prices were rising by more than 5% compared with the previous year. China’s later, faster reopening is now more than three months old. But inflation remains locked down. Consumer prices rose by only 0.7% year-on-year in March, slower than anywhere else in the world. This newspaper described China’s reopening as the biggest economic event of the year. So why has it had such a small effect on prices? Some suspect the recovery is weaker than the official statistics portray. Analysts at China Beige Book, which relies on independent surveys to track the country’s economy, told clients they were “snickering” at official figures showing that retail sales surged by 10.6% in March compared with the previous year.But growth looked laughably strong only when set against 2022, which was lamentably weak. Judged against earlier years, growth in retail sales was more modest and thus more credible. Compared with March 2021, for example, sales grew at the more modest annual pace of 3.3%. What is true of retail sales is true of the broader economy. The recovery from last year’s nadir is real and robust. But the recovery to pre-pandemic trends is partial and uneven. China spent much longer under lockdowns than America. It may therefore have further to go before it returns to anything like full capacity. Take property. Although sales this year are stronger than they were late last year, especially in the big cities, they remain far weaker than in 2021 (a boom year) or even 2020. Rents are still falling, contributing to low inflation. The drop in the price of fuel for vehicles has also made a difference. China’s great reopening was supposed to lift global energy prices, prolonging the rest of the world’s battle against inflation. Yet as America and Europe have courted recession, oil prices have dropped. The rest of the world’s battle against inflation has curtailed energy prices, prolonging weak inflation in China. China’s reopening has departed from the script in other ways, too. In America, workers armed with “stimmy” cheques from the government felt able to cut their hours, quit their jobs or badger their bosses for better pay. There was much talk of a “Great Resignation”. China’s households have had no such luck. They received little direct help from the government under its zero-covid regime. Their labour supply was not therefore “distorted by excessive transfers”, as economists at Morgan Stanley, a bank, point out. Indeed, even as China’s reopening has strengthened demand for goods and services, it has improved China’s capacity to supply them. The lifting of restrictions removed bottlenecks and unsnarled supply chains. Despite a weak global economy, China’s exports rose by almost 15% year-on-year in dollar terms in March, as firms finally cleared a long backlog of orders.Psychology may also help explain China’s inflationless recovery. Companies do not raise prices lightly. If they are not sure stronger demand will persist, they will remain reluctant to charge customers more. China’s economy is growing despite lingering doubts. But inflation may be weak because of them. ■For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. More

Stand in the middle of the teeming Meena Bazaar in Dubai and it is not hard to imagine you are 1,200 miles across the Arabian Sea in Mumbai. Lanes are filled with names like Biryaniwalla & Co, Mini Punjab Restaurant and Tanishq jewellery. Arabic works as a means of communication; so, too, do Hindi and Malayalam. The financial institution with perhaps the greatest prominence, looming over the Dubai Creek, is Bank of Baroda, which is controlled by the Indian state. Rather than serving merely as an ethnic enclave, the Meena Bazaar is the visible tip of a vast, growing network of Indian businesses—one that includes many of the most important companies in the United Arab Emirates (uae). To live in Dubai is to play a part in Indian commerce. The local business chamber reports that some 11,000 Indian-owned companies were added to its records in 2022, bringing the total number to 83,000. Trade links between the two countries are getting ever tighter.Behind these companies stands a vast diaspora: 3.5m Indians live in the uae, compared with 1.2m Emiratis. These expats collectively sent home $20bn in 2021, a transfer exceeded only by remittances from America to Mexico (see chart). Many in Mumbai joke that Abu Dhabi and Dubai are now the cleanest Indian cities. For the uae, India is a source of food, gems, jewellery, leather, people, pharmaceuticals and investment opportunities. For India, the uae is a crucial source of capital and, increasingly, a place where Indian business can efficiently connect with global markets away from its homeland’s debilitating red tape, crippling traffic, stalled airport immigration lines and punitive taxes.This relationship would have been unimaginable in 1973, when a store selling Indian saris gave the Meena Bazaar its name. Abu Dhabi was desperately poor. Insufficient desalinisation meant water was often brackish. Until 1966 a version of the Indian rupee, called the “external rupee”, served as the area’s currency. The uae had only emerged from what was known as the Trucial States, tribal lands linked by old treaties, in 1971. Almost all international trade, which (pre-oil) mostly consisted of diamonds, pearls and gems, passed through Bombay. Half a century later, conditions have turned on their head. Crowded Emirati malls glitter with the world’s most sophisticated products. Indian gem traders fill Dubai’s 68-storey Almas Tower, fed by ground-level restaurants such as Delhi Darbar Express and Mumbai Masala.Travel between the two regions is frenetic and growing. Emirates, Dubai’s flagship airline, is capped by Indian authorities at 66,000 seats a week; it wants another 50,000 and argues higher limits would benefit other carriers, too. Mumbai businessmen frequently make day trips to the uae. Many choose to stay longer, often with “golden” ten-year visas. A survey by the Indian Embassy in the uae finds that 60% of chief financial officers of major firms are Indian. Pankaj Gupta, a fund manager who moved to Dubai from Delhi 25 years ago, says Indians can be found in top jobs across industries in the Emirates. Nominal trade between the two countries has grown by 16% in the past year, boosted by a trade deal that went into effect in May. This has had an impact on the geography of Indian success. “Affluent India has a new residential address,” as the Times of India has put it. Mukesh Ambani, India’s richest citizen, broke Dubai’s house-price record in August with the purchase of a property for $80m (replete with ten bedrooms, indoor and outdoor swimming pools, a beach and a private spa, it sits at the tip of a palm-fringed archipelago). He then broke that record with a $163m purchase in October (about which details are more scarce). All told, Indians last year spent $4.3bn on housing in Dubai, twice as much as in 2021. Figures on commercial purchases of property are harder to unearth, but one banker reports that interest has been just as intense. These are spurred by odd provisions in India’s tax code that push people who want to get cash out of the country into property investments.The uae’s tax system exerts its own pull: there are no personal taxes. By contrast, Indian income taxes approach 40% and come on top of swingeing consumption levies. Corporate-income taxes are not only higher in India, they are also bewildering in their complexity. There are other important legal differences. The uae technically operates under strict Islamic law. In practice, it now has commercial courts that operate under international standards and a tolerant view of vice. It also encourages religious pluralism. Abu Dhabi recently built an enormous Hindu temple and combined Muslim-Christian-Jewish centre. India is technically secular with established common law. But in practice it offers clogged courts, strictly enforced anti-alcohol and vice laws, and increasing religious strife.Closer links with the uae are to the advantage of those doing in business in India, too. Beginning in 2020, when Mr Ambani raised billions of dollars from the uae’s many sovereign-wealth funds, the country has increasingly been seen as an important source of capital. Bain, a consultancy, reckons that between 2018 and 2022, Emirati sovereign-wealth funds and other private-equity firms invested $34bn in India, in steadily rising amounts.The range of investments is impressive. There are direct stakes in some of India’s leading banks, manufacturers and startups. It is widely assumed that if Gautam Adani, India’s second-richest tycoon, recapitalises his businesses, a crucial source of finance will be Abu Dhabi, which has already invested billions of dollars in several of his companies. All of this suggests that the Emirates is evolving into a financial capital for India. Yet this evolution is not free of obstacles. In March last year the uae was put on the “grey list” by the More