Trump guilty in hush money trial

This report is from today’s CNBC Daily Open, our international market newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. As you see? You can subscribe here.

Trump guilty in hush money trial
A New York jury convicted former President Donald Trump on all 34 felony charges for falsifying business records related to the payment of money to porn star Stormy Daniels by his personal attorney before the 2016 election. Trump is the first former US president to be convicted of a crime. Sentencing is set for July 11 at 10 a.m. ET, just four days before the Republican National Convention in Milwaukee, where Trump is expected to be confirmed as the GOP presidential nominee. Trump, who remains free without bail, faces a maximum sentence of four years in prison for each count.

Saleforce sinks stock
Wall Street closed lower after Salesforce had its worst day in two decades. The Dow Jones Industrial Average fell 330 points. The S&P 500 and Nasdaq Composite both lost. Nvidia fell for the first time since earnings last week and Microsoft had its worst day since October. The yield on the 10-year Treasury fell below 4.6% but remained above 4.5%, a level at which investors may consider switching out of stocks for better yields elsewhere. US oil prices fell 1% and were on track for their worst month of the year as gasoline demand remained soft.

Dell collapses despite AI growth

Dell shares fell as much as 20% in extended trade after first-quarter earnings met Wall Street expectations. Still, Dell shares have more than doubled in value before earnings on Friday. The company has become a leading vendor for AI-oriented servers, which are in high demand as businesses invest in infrastructure for predictive analytics and generative AI.

Leg baler
Foot Locker shares surged more than 30% as the sneaker retailer’s turnaround plan resulted in better-than-expected sales. “We had a solid start to the year in the first quarter, which shows that the Lace Up Plan is working,” CEO Mary Dillon told CNBC in an interview.

The Asia-Pacific market is on the rise
Markets in the Asia-Pacific region traded higher as investors skipped the release of economic data. Japan’s Nikkei 225 rose 1% after inflation in the Japanese capital, Tokyo, rose 1.9%, in line with expectations. South Korea’s Kospi rose 0.1% after the country’s industrial production index beat expectations, rising 2.2%. Mainland China’s CSI 300 index rose 0.1%, and Hong Kong’s Hang Seng added 0.4%.

(PRO) AI power boom
ChatGPT search queries are about six to ten times more power intensive than regular Google searches. As the demand for artificial intelligence increases, the power grid will come under pressure. Goldman Sachs has selected some global stocks that could benefit from this boom.

Want to gauge the health of the US economy? Ask retail CEOs. After all, consumer spending, which is the lifeblood of the economy, accounts for about two-thirds of GDP.

“Consumers are under pressure; prolonged inflation, interest rates that are impacting everything from home payments to student loans, low savings … how.” Foot Locker CEO Mary Dillon told CNBC in an interview.

This earnings season has underscored Dillon’s point. While retailers like Foot Locker, Best Buy, Dollar General, and American Eagle Outfitters beat profit estimates, their results generally met or fell short of analyst forecasts. This suggests that companies need to work harder to attract more cautious consumers, who are now more selective about where and when they spend their hard-earned money.

The broader economic picture has also lost some of its shine since the end of last year. The Commerce Department revised first-quarter GDP growth down to 1.3%, a significant drop from its initial estimate of 1.6%. And probably the most important part of the reading is the reduction in consumption, from 2.5% growth to 2%.

Pending home sales in April fell to their lowest level since the pandemic, further underscoring consumer struggles.

New York Federal Reserve President John Williams reiterated a recent statement from the central bank that inflation is still very high. On the interest rate, he said: “I think that the monetary policy is restrictive and makes the economy a better balance. So I think at some point, the interest rate in the US will, based on the analysis of the data, finally have to go down. But the time will be pushed in your way can achieve your goals.”

The Fed’s target for inflation remains at 2% and investors will be closely watching the Commerce Department’s inflation data on Monday. The personal consumption expenditures price index – the Fed’s preferred inflation number – is expected to come in at 2.7% for April, according to Dow Jones estimates.

It’s not just the market that wants to lower interest rates; Retailers also need consumers to open their wallets, and that will only happen when they feel the Fed is pulling for them.

— CNBC’s Dan Mangan, Jeff Cox, Alex Harring, Hakyung Kim, Leslie Josephs, Robert Hum, Diana Olick, Spencer Kimball and Yun Li contributed to this report.