☕️SPY bears

Good morning.

Despite the wall of red that seems to intensify with every new trading session (with the US and China now seemingly in a race to the bottom), some of the more cynical shrewd operators have been netting eyewatering gains.

Short sellers have accumulated a whopping US$159 billion ($265 billion) in paper profits in just over six trading days. Traders wagering that the ETF that tracks the S&P 500 Index, known as SPY, would fall, have so far accumulated paper profits of more than US$6.1 billion this month, Bloomberg reports. April’s most profitable shorts coming in from SPY, Apple, Nvidia and Tesla.

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Market movers

Another volatile day saw the ASX tumble 1.8% Wednesday on Trump’s tariffs, with Champion Iron the biggest loser, sliding 14.2% amid a broad commodities selloff.

The quick sync

• As Tom King writes, Trump’s energy rollback is rattling markets, but clean tech’s global momentum is proving hard to kill. (Capital Brief)

• Australian banks stay the course on net zero despite global political pushback, but face growing scrutiny over Scope 3 emissions and financed climate risk. (Capital Brief)

• CoStar’s $2.8b Domain bid remains unaffected by a capital structure review following pressure from hedge funds Third Point and D.E. Shaw. (Capital Brief)

• Atlassian is giving away its AI to prove a point: AI will deepen, not diminish, demand for engineers. (Capital Brief)

Trading floor

M&A

• TPG has acquired a majority stake in home care provider Five Good Friends, joining its co-founders, while EQT retains a minority interest. (Capital Brief)

• Peabody Energy may reconsider its $6b deal for Anglo's Queensland coal mines after a second fire at an underground site in less than a year. (AFR)

• Dingo is exploring a deal with a forecasted $16m revenue, enlisting Lazard’s bankers. (AFR)

• The ACCC has approved Woolworths’ acquisition of ready meals maker Beak & Johnston, finding it unlikely to harm competition. (Capital Brief)

• Quadrant's buyout of Mediaworks could influence Australian media players like Nine Entertainment, which plans to return proceeds from the $2.8b Domain sale to shareholders. (The Australian)

• MinRes is under scrutiny for possibly selling its Wodgina lithium operation and considering an equity raise amid significant debt and liquidity concerns. (The Australian)

• Mayfly Ventures merges with Oka Studio to target larger corporate innovation projects, expanding its team to 12 staff. (BNA)

Capital Markets

• ASX drops 1.7% as Trump's tariffs hit Australian and global markets. (Capital Brief)

• Trump has signed executive orders to boost the coal industry, aiming to power AI centres and dismantle Biden-era climate rules, despite coal’s environmental impact. (Capital Brief)

• Trump plans to impose tariffs on pharmaceutical imports to push drug companies to relocate production to the US. (Capital Brief)

• Markets, including bonds, react to Trump’s tariffs amid fears of inflation and capital flight. (Breaking bonds — Capital Brief)

• Economists are pressuring the RBA to deliver an early rate cut in response to global trade turmoil sparked by Trump’s tariff plans. (Capital Brief)

• Trump’s tariffs spark global bond selloff, signaling potential shift away from US Treasuries. (Capital Brief)

• US defends tariffs on Australia, citing trade imbalances, while Australia condemns the move as damaging. (Capital Brief)

• Trump cuts most tariffs to 10% for 90 days, hikes China's to 125%, sparking a surge in US stocks and commodities. (Capital Brief)

• Trump's policies may slow clean energy growth in the US, but global forces continue driving the energy transition forward. (Capital Brief)

• China imposes 84% tariffs on US goods, deepening market declines and raising recession fears. (Capital Brief)

• Chalmers rejects recession fears, defends Australia’s economic strength amid global trade challenges. (Capital Brief)

• Galan Lithium is considering capital raising after rejecting a takeover bid, aiming to continue developing its Argentinian projects. (AFR)

• GQG Partners increased its funds under management in March and is repositioning portfolios to reduce risk amid market volatility. (Capital Brief)

• Healthscope faces a key deadline on May 18 regarding its $1.4b debt, with Brookfield at odds with HMC Capital. (The Australian)

• Metrics paused funding for a Sam Mustaca-led development in Warriewood amid a legal dispute. (AFR)

• Liontown starts underground lithium mining at Kathleen Valley. (Capital Brief)

• Tanarra Capital, led by John Wylie, invests in Endeavour amid leadership uncertainty and a business review. (AFR)

• Lendlease is facing unrest from its institutional investment clients, with some seeking legal advice to move their funds due to poor performance and Lendlease’s retreat from international markets. (The Australian)

• Miniso Australia faces a winding-up order after two voluntary administrations in five years, with market issues contributing to its collapse. (Smart Company)

• Merricks Capital defends private credit as stable during market volatility, with its $1.19b fund returning 8.1% in 2024 despite real estate corrections. (Capital Brief)

• Fed officials warn of rising stagflation risks as Trump’s tariffs stoke inflation fears and cloud the 2025 economic outlook. (Bloomberg)

• Goldman Sachs U-turned on its recession call after Trump blinked on tariffs, but markets and economists aren’t buying the all-clear. (Bloomberg)

VC

• None

People moves

• Point72 hires Jay Ditmarsch from Carlyle Credit to lead a new strategy, marking a significant move for the hedge fund. (AFR)

The watercooler