🏦 Is The Banking Sector Under Pressure?

Good morning. US stock futures inched higher in Tuesday morning trading as investors turned their attention to the latest batch of corporate earnings.

🏦 Loan demand wanes across US banks

📝 Our report: Looks like U.S. banks are feeling the pinch – they reported a dip in demand for industrial loans and less household interest in credit in the first quarter, according to a Federal Reserve survey of loan officers. The net share of large and medium-sized banks reporting tightening standards for commercial and industrial loans ticked up to 15.6%, from 14.5%, the survey showed.

 🔑 Key points:

• For households, a rising share of banks reported tightening standards for auto loans, while a shrinking share of banks did so for credit cards and other types of consumer loans, the survey showed.

• For commercial real estate loans of all types, however, the share of banks tightening standards shrank to the lowest in two years.

• Monetary policy tightening typically works to ease price pressures through credit channels, with higher borrowing costs reducing demand for loans.

💡 So what: Waning loan demand in the US carries implications for both the economy and banks. A decrease in borrowing indicates subdued economic activity and may impact overall growth. Reduced loan demand also affects bank profitability as they rely on interest income from loans. The Federal Reserve monitors loan demand closely as part of its assessment of economic conditions, influencing its monetary policy decisions aimed at stimulating growth.

Tuesday - Consumer Credit

Wednesday - Boston Fed President Susan Collins Speaks

Thursday - Initial Jobless Claims (wk end May 3)

Friday - Chicago Fed President Austan Goolsbee Speaks

📈 Mark Cuban shares his investing tips!

🏦 Here are 7 banking scams to avoid!

💰 Got a raise? Here are 6 ways to use it effectively!

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📉 Robinhood in hot water with the SEC

WHAT: Robinhood just got a friendly little tap on the shoulder from the US Securities and Exchange Commission – they've received a "Wells Notice" about their crypto token trading antics. Responding to the notice, Robinhood’s Chief Legal Compliance and Corporate Affairs Officer Dan Gallagher said in a statement: “We firmly believe that the assets listed on our platform are not securities and we look forward to engaging with the SEC to make clear just how weak any case against Robinhood Crypto would be.”

WHY: The SEC has taken a hardline against crypto companies, claiming most digital tokens should be regulated as securities, and thus subjected to SEC registration rules.

🛢️ Oil exec: Natural gas demand to rise on data center electricity needs

WHAT: Chevron CEO Mike Wirth just turned up the heat on natural gas predictions, suggesting demand might skyrocket thanks to AI and data centers gobbling up electricity. Wirth added that coal plants were being phased out in the U.S., nuclear power is expensive and geothermal energy is not as proven as other power sources, leaving natural gas as the superior option.

WHY: Electricity demand in the U.S. is expected to surge by as much as 20% by 2030, according to research from Wells Fargo published in April. Natural gas demand could increase by 10 billion cubic feet per day, or bcf/d, by the end of the decade as a consequence, according to Wells.

✈️ Boeing under investigation…again

WHAT: Looks like Boeing's got another plot twist in its aviation saga – US safety regulators are launching yet another investigation after Boeing fessed up to some possibly incomplete inspections on its 787 long-haul jetliner. Boeing notified the US Federal Aviation Administration in April that the company may not have completed required inspections of how the 787 Dreamliner’s wings join to the airplane’s body, the agency said in a recently released statement.

WHY: Boeing has said it is encouraging workers to speak up about safety concerns and irregular factory practices to change its culture on the factory floor.

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