Marvel breaks the internet

MARKETS

• Trade: The World Trade Organization projects world trade will grow at 2.6% this year, the lowest level in three years. It cited new tariffs, tariffs in response to those tariffs, and tighter monetary conditions as factors in its downbeat outlook.
• Fed: President Trump reportedly told his nemesis, Fed Chair Jerome Powell, “I guess I’m stuck with you.” Are they going to star in Step Brothers 2?

#METOO

A High-Stakes Hearing in Boston

Here’s the thing about gambling officials: They know when you’re trying to hide something.

And following an in-depth investigation by the Massachusetts Gaming Commission, regulators found that Wynn Resorts (+4.40%) executives covered up allegations of sexual misconduct against billionaire founder, Steve Wynn.

• While some company leaders who knew about the complaints against Wynn “disregarded Company policies when it came to handling those allegations”...
• Others “were part of affirmative efforts to conceal allegations against Mr. Wynn that came to their attention.” Which implies they went out of their way to cover up what was going on.

What was going on

When casino mogul Wynn was accused of a decades-long pattern of sexual harassment and assault in January 2018, he became one of the highest profile executives swept up in the #MeToo movement (Wynn has been called the “unofficial king” of Vegas).

Wynn denied the allegations, but he resigned as chairman and CEO of the company and sold his 11.8% stake. Wynn Resorts also said it was withholding a severance package that reportedly totaled $330 million.

Back to your burning question

Q: Why was Massachusetts (of all places) investigating Wynn Resorts?

A: The report was released at the beginning of a three-day hearing. At stake is whether the company should be able to keep its license to operate a new $2.6 billion casino, the 671-room Encore Boston Harbor in Everett, MA (scroll to the top of the story for a visual). It’s set to open in June, but a decision on the company’s license could take weeks.

Looking ahead...Wynn Resorts said it cleaned house of employees who knew of the allegations but stayed silent, and investigators did credit the company with “significant changes in leadership, policies, structure, and internal controls." Will that be enough?

ENTERTAINMENT

Marvel Breaks the Internet

Sorry if this newsletter is crashing. There was too much demand.

Sort of like some websites yesterday after Marvel announced presale tickets for its upcoming blockbuster, Avengers: Endgame. Because nothing is sacred, AMC said on Twitter, “We want everyone to be able to grab their Avengers: Endgame tickets, but it looks like we’ve gotten Thanos’ snap.”

• Fandango put users in virtual lines...then told them, “The line is paused” as wait times climbed to more than an hour.
• There’s nothing worse than waiting in line without your phone because your phone is in line.

Atom Tickets said Endgame set a record for first-hour presale. It sold more than 3x on Atom than its prequel, Avengers: Infinity War, did in its first hour. That movie went on to become the fourth-highest grossing film ever.

Suffice to say this Avengers is going to be a big one. When it arrives in theaters April 26, Box Office Pro expects it’ll set a record for domestic ticket sales with a $265 million opening weekend.

ENERGY

Shell Consciously Uncouples

Royal Dutch Shell (+0.36%) is breaking it off with the American Fuel and Petrochemical Manufacturers (AFPM) group, because...that’s what happens when you can’t agree on climate change policy.

The oil giant cited a “material misalignment” with the leading refining lobby, which roughly translates to “we think it’s kind of shady you haven’t publicly supported the Paris Agreement.”

• Shell has been a proponent of the 2015 accord, whose aim to limit global warming is supported by almost every country in the world (but notably not the U.S.).
• It also took issue with AFPM’s stance on carbon pricing, fuel mandates, and methane emissions reduction.

Zoom out: Like any company that gets the bulk of its top line from fossil fuels, Shell has a complicated relationship with climate activism. It agreed last year to link executive pay to emission reduction targets starting next year, which was a first for the industry. But...Shell’s also facing an activist-backed lawsuit demanding it give up on the oil biz entirely.

SPORTS

Horse Racing Reaches a Crossroads

The Sunday death of a thoroughbred named Arms Runner marked the 23rd equine death since Dec. 26 at California’s iconic racetrack, Santa Anita Park.

Putting it in perspective: In all of 2017, there were only 20 deaths at Santa Anita. The sudden spike has activists and lawmakers pushing for an investigation.

“This is our March Madness. But we’re having the wrong kind of madness,” said Hall of Fame trainer Bob Baffert. Let’s keep the NCAA comparisons going: While the college sports org just cleared $1 billion in annual revenue, horse racing does that much in breeding and sales auctions alone.

• About $12 billion is bet at North American tracks annually.
• And the total cost to own the offspring of Triple Crown winner Justify? $75 million, per ESPN.

Zoom out: Santa Anita has a lot of questions to answer. Races resume tomorrow at the track, but Saturday brings the $1 million Santa Anita Derby—featuring a lineup of Kentucky Derby contenders.

TECH

We'll Make You a Public Offer You Can't Refuse

Or can you...

Nothing we love more than festive charts documenting the performance of recent tech IPOs. But pay close attention—this is through March 29. Since then, Lyft has struggled to keep that green bar...green.

Lyft stock finished lower 0.06% in its third trading session—which wasn't quite so bad as the 12% it lost a day earlier. As Axios points out, it’s pretty weird that an IPO so well-loved as Lyft’s would lose steam without any earth-shattering bad news or a material disclosure. Plus, the short sellers haven’t even sunk their vampire teeth into the stock yet.

The big question: It’s still very early, but does Lyft’s shaky start on the public market blanket the rest of 2019’s highly anticipated tech IPOs with a sense of foreboding?

And the even bigger question: Do you think Lyft will be in the red or in the green if Statista were to make the same chart exactly one year from now?

WHAT ELSE IS BREWING

• U.S. auto sales slumped in Q1. Not even that new car smell is worth it in an environment of higher prices and interest rates.
• The FDA has set the date for its first public hearing on legalizing CBD in food and drinks for May 31.
• Qualcomm (-0.76% after hours) CFO George Davis is leaving the company to take up the same post at rival Intel (+0.42% after hours).
• Walgreens stock slumped 12.8% after the drugstore chain lowered its earnings expectations. Q1 was the “most difficult” it’s ever had.
• BlackRock (-0.44%), the world’s largest money manager, is launching a major reshuffling to move “to the next level” in alternative investments.

BREAKROOM

Math Is a Really Cool Thing
This one is for the pros: Find the smallest number such that if its rightmost digit is moved to its left end, the new number you create is 50% larger than the original number.

Breakroom Answers