Bill Gross picks Europe

Bond king Bill Gross says Europe is the place to look for opportunity. His assessment came in the aftermath of election results revealing a rightward lurch for the region’s voters, shaking up markets and sending French bond yields to their highest mark this year. “There’s coming a point where European bonds are more attractive than Treasury bonds,” said Gross, co-founder and former chief investment officer of Pacific Investment Management. “In terms of attraction, the German 10-year bunds and French 10-year, their spreads have narrowed significantly in the past month or two relative to Treasuries.” This weekend, two of Europe’s most influential leaders, France’s Emmanuel Macron and Germany’s Olaf Scholz, suffered surprise defeats in European Parliament elections—both coming at the hands of the far-right. Macron called a snap election. Traders pushed the yield on 10-year French bonds more than 12 basis points higher to 3.23%, the highest mark since November. German and Italian bonds similarly sold off on Monday. According to Gross, the earlier elections in Mexico, India and South Africa—where surprise results upended markets and torpedoed once-reliable macro trades—also offer a guide for how the looming US election may impact assets all over the globe. —David E. Rovella

One factory making CVS-branded pain and fever medications for children used contaminated water. Another made drugs for kids that were too potent. And a third made nasal sprays for babies on the same machines it used to produce pesticides. The drugs were among those sold by CVS Health Corp. under its store-brand label before being recalled. Other US chains have seen their share of recalls for their own store-branded medications. But over the past decade those of CVS have been recalled about two times more than those from Walgreens Boots Alliance and three times more than those from Walmart, a Bloomberg analysis of public records found.

Ouch. Another New York City office building is set to be sold at a steep discount amid the deepening commercial real estate crisis. Empire Capital Holdings and Namdar Realty Group agreed to purchase this Manhattan property for less than $50 million. That’d be a roughly 67% discount from the nearly $153 million that Related Fund Management paid for it in 2018.

The housing market has faced a different conundrum at every turn, Conor Sen writes in Bloomberg Opinion. This year’s puzzle? The disconnect between an aggressive rise in the number of existing homes for sale and still sluggish transactions. Sen explains the two reasons for this.

The cost of owning a home in the US has increased 26% since 2020, as expenses including taxes, insurance and utilities all soared during a period of high inflation across the economy. The average annual outlay for owning and maintaining a typical single-family home—not including mortgage payments—totaled $18,118 in March. That works out to $1,510 a month, roughly $300 more than four years earlier.

European officials are in talks to keep gas flowing through a key Russia-Ukraine pipeline as they race to prevent Moscow’s war from further damaging the continent’s energy supplies. Europe has tried to wean itself off Russian gas but several eastern European states continue to receive it through a pipeline that crosses Ukraine. The agreement that covers this transit arrangement expires at the end of this year, however. And with Russia’s war still raging, most market watchers expect the gas to finally come to a halt. European government and company officials are now said to be talking to counterparts in Ukraine about how to keep the gas flowing.

Indian Prime Minister Narendra Modi, just off a humbling victory where a widely predicted landslide failed to materialize, is picking his new cabinet. And it’s going to include many of the same faces as the last one. Modi was sworn into office for a third consecutive term Sunday, followed by his council of ministers, a group that consists of 30 officials. Nineteen of them are from Modi’s previous cabinet.

Apple announced its long-awaited new artificial intelligence features, including tools supported by OpenAI’s ChatGPT. The company says the platform, called “Apple Intelligence,” will help summarize text, create original images and retrieve the most relevant data when users need it. The tech giant also unveiled new versions of operating systems for the iPhone, iPad and Mac. “This is a moment we’ve been working toward,” said Senior Vice President Craig Federighi.

In the early 1980s, college-educated twenty- and thirtysomethings began taking up residence in blighted urban neighborhoods. Local press in Chicago, Philadelphia, New York and San Francisco reported on these nascent gentrifiers as if they were an invasive species. “They seek neither comfort nor security, but stimulation,” wrote Dan Rottenberg in Chicago magazine. These so-called yuppies—a portmanteau of young urban professionals—were seen as regressive. They were responsible for turning the dreams of their parents upside down, forsaking a suburban American dream for the cities. According to Triumph of the Yuppies, a new book by veteran magazine journalist Tom McGrath, they went on to ruin just about everything else.

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