Elon Musk wrapped up a trip to China in less than 24 hours and came away with a crucial victory as he pushes to reignite Tesla’s sagging growth. After his flurry of meetings with top officials in Beijing, China’s government signalled its blessing for Tesla to roll out its advanced driver-assistance service in the carmaker’s second-biggest market. The Tesla chief executive is seeking to expand use of the controversial software feature globally as the company confronts the prospect of lower sales growth this year. Chinese officials told Tesla that Beijing has tentatively approved the company’s plan to launch its “Full Self-Driving,” or FSD, software feature in the country, people familiar with the matter said Monday. The U.S. electric-vehicle maker will deploy its autonomous driving services based on mapping and navigation functions provided by Chinese technology giant Baidu, the people said. Tesla’s stock was up 15.3% in trading on Monday.

On Monday, the SMI lost 0.1 per cent to 11,332 points. Among the 20 SMI stocks, there were 12 price gainers and 8 price losers. A total of 16.96 million shares were traded (Friday: 20.58 million). Price movements ranged from +1.0 per cent for Zurich Insurance to -1.0 per cent for Lonza, thus remaining within a narrow range overall. Among the top performers in the insurance sector were Swiss Life and Swiss Re (+0.8 per cent each). According to a report, Morphosys (-3.2%) is said to have safety problems with its drug candidate Pelabresib against the bone marrow disease myelofibrosis in a study. The drug is considered one of the main reasons for Novartis' vested interest (-0.7%). Morphosys responded the takeover by Novartis is progressing steadily and the company remains convinced of the risk-benefit profile resulting from the combination of Pelabresib and Ruxolitinib.

Europe
European equity markets closed mixed on Monday, at the start of a week rich in economic indicators and corporate results. The Stoxx Europe 600 index gained 0.1% to 508.3 points. In Paris, the CAC 40 and SBF 120 lost 0.3% each. The DAX 40 in Frankfurt was down 0.2%. The FTSE 100 in London advanced by 0.1% to 8,147.03 points, after setting a new session record of 8,189.14 points. The IBEX 35 lost 0.5% in Madrid. Atos shares jumped 19.2%. The troubled digital services group announced that it had almost doubled its estimate of the amount of cash needed to finance its business over the period 2024-2025 and that it had received a non-binding offer from the French government to take over its strategic activities. SES shares closed down 10.4% as the satellite operator and Intelsat relaunched merger talks, according to Bloomberg. Shares in rival Eutelsat lost 2.4%. Diversified group Bolloré (-1.5%) reported higher first-quarter sales, while its takeover of Lagardère boosted growth at its main holding, Vivendi. Industrial minerals producer Imerys (+2%) announced that it had entered into exclusive negotiations with Chemviron, a subsidiary of Calgon Carbon Corporation, with a view to acquiring its European diatomite and perlite activities. Philips shares soared 29.4% on the Amsterdam Stock Exchange. The Dutch medical technology group announced that it had reached a $1.1 billion settlement with the US courts over its Respironics respirators and confirmed its projections for the 2024 financial year. Deutsche Bank shares tumbled 8.6% in Frankfurt as the German bank announced a provision of around €1.3 billion in the second quarter for legal disputes with former Postbank shareholders.

United States
A 15.3% jump in Tesla’s stock helped the market extend its rally to start a busy week for corporate earnings and economic data. Major U.S. indexes edged higher Monday. The S&P 500 rose 0.3%, while the tech-heavy Nasdaq Composite ticked upward by 0.4%. The Dow Jones Industrial Average increased 0.4%, or 146 points. A Federal Reserve meeting set to conclude Wednesday could give investors additional hints regarding whether the central bank might lower rates by year’s end. That update will be followed Friday by the April jobs report, which will provide the latest snapshot of a U.S. economy that continued expanding in the first quarter. Although many traders have shied away from riskier assets in recent weeks, one of the year’s most volatile stocks led the S&P 500 on Monday. Tesla shares’ 15.3% rise was their largest one-day gain since 2021 and came after Chief Executive Elon Musk won Beijing’s blessing to roll out the company’s driver-assistance service in China. The automaker’s share price has nevertheless slumped 22% this year amid a darkening outlook for electric-vehicle sales growth. Shares of Fulton Financial increased 7.6% following the acquisition of regional bank Republic First in a government-backed deal. Media conglomerate Paramount Global rose 2.9% ahead of the evening news that the CBS owner’s chief executive, Bob Bakish, would step down amid sales talks. Shares in Google-parent Alphabet, which jumped Friday after better-than-expected earnings, retreated 3.3% Monday, while Instagram owner Meta Platforms shed 2.4%. The two stocks’ losses turned the S&P 500’s communications-services sector into the index’s big laggard. Earnings season will pick up speed Tuesday, when results from Amazon.com, McDonald’s and Coca-Cola are due.

Asia
In Asia, major indexes broadly closed with gains. In Tokyo, the market made up for the previous day's gains in the region after the holiday break at the start of the week - although the stabilisation of the yen also provided support. The Nikkei-225 rose by 1.0 per cent to 38,322 points after industrial production rose more strongly than expected. In China, little is happening on the stock exchanges in Hong Kong and Shanghai, with the indices performing well or just about holding their ground. The market in Shanghai will remain closed from Wednesday until the end of the week due to the May festivities. Meanwhile, LONGi Green Energy Technology lost 4.2 per cent after the company slipped into the red during the first quarter. Meanwhile, the South Korean Kospi climbed 0.7 per cent, driven by battery and electronics stocks. The market was supported above all by positive final business results from Samsung Electronics, the share price rose by 1.4 per cent. Samsung Electronics benefited from the AI boom in its semiconductor business.

Bonds
Rates on U.S. government debt finished slightly lower on Monday as traders looked ahead to the Federal Reserve’s policy decision and April’s official jobs report later this week. The 10-year Treasury note yield declined by 6 basis points to 4.613%. The 2-year Treasury note yield shed 2 basis points to 4.983%.

Analysis
UBS cuts Bucher target to CHF 441 (445) - Buy
Baader lowers target Barry Callebaut to CHF 1,500 (1,600) - Add
DZ Bank downgrades Nestle target to CHF 110 (115) - Buy

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