Key Takeaways
- SoftBank (SFTBY) reported a massive fiscal year net income of ¥5.003 trillion ($31.74 billion), more than quadrupling the previous year's profit and shattering analyst estimates of ¥3.531 trillion.
- Intertek (ITRK) is set to agree to a £10.6 billion takeover by private equity firm EQT, marking one of the largest London-listed acquisitions in recent years.
- UK Prime Minister Keir Starmer faces a leadership crisis as the TULO umbrella group of 11 major unions declared he will not lead the party into the next election following "catastrophic" local results.
- UBS Global Wealth Management pushed back its Federal Reserve rate cut forecast, now expecting 25 bps cuts in December 2026 and March 2027, citing persistent inflation and a resilient labor market.
- European semiconductor stocks rallied 1%–5%, led by ASML (ASML) and STMicroelectronics (STMPA), as investors hunt for AI-related plays outside of Wall Street.
SoftBank’s AI Pivot Pays Off with Record Gains
SoftBank (SFTBY) has staged a dramatic financial recovery, posting a full-year net profit of ¥5.003 trillion ($31.74 billion) for the fiscal year ending March 2026. The results were primarily driven by $43.9 billion in gains from its investment in OpenAI, the creator of ChatGPT.
The Japanese tech giant confirmed it is doubling down on artificial intelligence, with plans to increase its total investment in OpenAI to $64.6 billion. Additionally, the company benefited from the March Nasdaq listing of its payment app operator, PayPay, further strengthening its balance sheet for future AI infrastructure projects.
Intertek Nears £10.6 Billion Deal with EQT
Testing and certification giant Intertek (ITRK) is reportedly on the verge of accepting a £10.6 billion "final" offer from private equity group EQT. The deal comes amid mounting pressure from shareholders for the board to engage with the buyout firm following a period of stagnant growth.
The takeover has become the primary focus of the London market, pitting major investment banks against each other in what analysts describe as a "showdown" for one of the UK's most prominent industrial service firms. If completed, the deal would represent a significant premium over Intertek's early March trading levels.
UK Political Turmoil as Unions Withdraw Support
The Trade Union and Labour Party Liaison Organisation (TULO), representing 11 major union funders, issued a stinging statement today claiming "Labour cannot continue on its current path." The group stated it is "clear the PM will not lead Labour into the next election," following the loss of over 1,000 council seats in recent elections.
Prime Minister Keir Starmer is currently facing a coordinated revolt, with more than 90 Labour MPs calling for his resignation. High-profile ministerial departures, including Jess Phillips and Zubir Ahmed, have further destabilized the government ahead of a scheduled meeting with leadership rival and Health Secretary Wes Streeting.
Global Macro: Fed Delays and Geopolitical Tensions
UBS Global Wealth Management has revised its outlook for the U.S. Federal Reserve, delaying expected rate cuts until late 2026. The bank now forecasts two 25 bps reductions in December 2026 and March 2027, a significant shift from its previous forecast of cuts starting in September of this year.
On the geopolitical front, markets are closely watching the eve of the Trump-Xi summit in Beijing. Tensions remain high in the Strait of Hormuz, where a Chinese-linked oil tanker, the Yuan Hua Hu, recently made a crossing via Iranian lanes despite a heavy U.S. Navy presence in the region.
Regional Market Moves and Energy Disruptions
In Europe, France’s CPI was confirmed at 2.2% year-on-year for April, driven by a 14.2% surge in energy prices. Meanwhile, Siemens (SIEGY) CEO Roland Busch noted that while Middle East tensions have not yet had an immediate impact on inflation, the long-term effects remain "uncertain."
Energy markets saw further volatility following a drone strike on a Russian oil refinery in Astrakhan, which triggered a significant fire. In South Korea, SK Innovation warned that operations may take time to normalize following extended disruptions related to regional conflicts.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.