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Illustration: Rebecca Zisser/Axios
Share buybacks contributed about half of S&P 500 companies’ earnings growth in the first quarter, a new report from JPMorgan shows.
Why it matters: "This is corporate executives saying, 'Rather than investing back into the business by making capital expenditures or buying equipment, I’m just going to buy my own shares,'" says David Kelly, a global market strategist at JPMorgan Asset Management, which published the report.
The big picture: S&P earnings growth has been a major worry for stock analysts this year, after 2018's blowout earnings following the passage of the Tax Cut and Jobs Act. The permanent reduction in corporate taxes was backed by President Trump and Congressional Republicans as a catalyst for a boost in wages and long-term investment.
Remember: Stock prices typically are tied to salaries and job performance reviews for top executives and boards, the very people making the spending decisions.
The last word: JPM's Kelly says the rising level of stock buybacks is one major reason he and other market analysts are worried about continued growth of business output, stock prices and the broader economy.
International Monetary Fund head Christine Lagarde will be the first woman to run the European Central Bank — and the first without central banking on her resume — after being nominated today to replace Mario Draghi at the end of October.
Why it matters: The eurozone is already running negative interest rates, with the prospect of more stimulus coming, Bloomberg notes.
Between the lines: "The choice of Ms. Lagarde will be a surprise to many," WSJ reports.
My thought bubble: Her warnings about the global economy's "delicate" health at this year's IMF spring meetings and continued insistence that Europe and the rest of the world are in need of TLC make Lagarde a natural fit to replace Mario "Whatever it takes" Draghi at a time when eurozone growth is slowing and markets are expecting more stimulus.
Bonus: German Defense Minister Ursula von der Leyen was nominated to be the next head of the European Commission. If approved by the European Parliament, this would mark the first time women have led both institutions.
Overall growth in the big, developed eurozone markets has been stunted at around 1% or less for much of the year, and the bloc may even fall into recession this year. But Central and Eastern Europe's economies have been growing significantly, recent research from Capital Economics shows.
The $26.5 billion merger between T-Mobile and Sprint may just happen after all.
Driving the news: T-Mobile is near a deal with Dish Network that would prop up Dish as a new fourth U.S. wireless competitor, likely giving it cover for DOJ approval, CNBC reports.
Flashback: The companies have been working on a tie-up for years, and the FCC has paused its review of the merger three separate times to examine "new information" related to the deal (and because of the government shutdown in January).
Shares of Six Flags rose another 1.3% on Tuesday after jumping nearly 5% Monday, following an upgrade to Outperform by KeyBanc over the weekend, with a $62 price target. The price target represented a 25% premium to the stock's Friday levels.
Axios' Courtenay Brown writes: President Trump announced on Twitter Tuesday that he intends to nominate Christopher Waller of the St. Louis Fed and Judy Shelton, an economist and Fed critic to the Federal Reserve Board of Governors.
Why it matters: Trump has been urging the Federal Reserve to lower interest rates and his new nominees seem to favor that view.
What's next: Both Waller and Shelton will need to be confirmed by the Senate. Waller is a former economics professor who has been at the Fed for 10 years. He recently defended the St. Louis Fed's opposition to interest rate hikes in an interview with Bloomberg.