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On August 28th, according to foreign media reports, sources familiar with the matter revealed that SoftBank Group is seeking a $10 billion loan to obtain more funds to refinance the debt it incurred for its investment in US tech giant OpenAI. The two-year loan will have an interest rate spread approximately 275 basis points higher than the benchmark Secured Overnight Financing Rate (SOFR), with Mizuho Bank acting as the designated lead arranger and bookrunner. This loan will be one of a series of recent debt financing activities related to SoftBanks bet on OpenAI. Sources indicated that part of the loan funds may be used to repay a $40 billion bridge loan SoftBank obtained earlier this year for its OpenAI investment. The deadline for loan commitments is August 31st, and several banks have already begun discussions to participate in the loan. SoftBank is also considering raising more funds through the bond market, considering issuing $10 billion to $20 billion in bonds to help refinance the bridge loan, while also planning a record 1 trillion yen retail bond issuance in the Japanese domestic market.Sources say SoftBank is seeking a $10 billion loan to refinance debt for its investment in OpenAI.On August 28th, Moodys analysts stated that large-scale investments in artificial intelligence could weaken the credit metrics of US hyperscale cloud service providers, but strong capital buffers can mitigate the pressure. With capital expenditures growing faster than operating cash flow, the free cash flow of US hyperscale cloud service providers is expected to decline in 2026-2027. Leverage pressures are expected to intensify further as companies like Meta, Alphabet, and Oracle increase bond issuance. However, hyperscale cloud service providers possess large cash reserves, and coupled with revenue and EBITDA growth, they can withstand 12 to 24 months of high capital expenditures without significantly impairing credit quality.French Finance Minister: The first batch of economic data released after the summer heatwave was "poor".On August 28th, as the trade dispute between the United States and Canada escalated, US President Trump signed an executive order on the 27th renaming Lake Ontario, located on the US-Canada border, as "Lake of the United States," stating that the order was "effective immediately." Many Canadians expressed dissatisfaction with the US governments renaming of Lake Ontario to "Lake of the United States," believing that the US action would only exacerbate tensions between the two countries.

Oil prices rise due to anticipated OPEC supply cuts

Skylar Williams

Aug 25, 2022 10:50

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Despite dismal economic signals from central bankers and a decrease in equities prices, oil prices increased in early Asian trade on Wednesday on Saudi Arabia's proposal that the Organization of the Petroleum Exporting Countries (OPEC) may consider a production cut.


U.S. crude prices rose 34 cents to $95.23 per barrel at 00:16 GMT, while Brent crude futures rose 51 cents to $101.73 per barrel.


Wednesday marked a three-week high for both benchmark crude oil contracts after the Saudi energy minister hinted at a possible supply cut.


Later, OPEC sources told Reuters that any cut by OPEC and its allies, known collectively as OPEC+, is expected to coincide with the return of Iranian oil to the market if Tehran obtains an international nuclear deal.


Iran reported receiving a response from the United States over the European Union's "final" language for resurrecting Tehran's 2015 nuclear agreement with major powers.


Ahead of Friday's U.S. Federal Reserve meeting, traders are seeking to predict whether the central bank will stop rate hikes or continue aggressive until it reaches its 2% inflation target.


Official numbers released on Wednesday suggested a sluggish demand for gasoline, which augurs a severe decline in economic activity.

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