Hamas says it accepts Gaza ceasefire proposal

Good morning. Here's what happened overnight and what you need to know today.

1.

Hostage deal: Hamas announced that it has agreed to a ceasefire proposal brokered by Qatar and Egypt to halt the ongoing fighting with Israel in Gaza. The proposal involves the release of Israeli hostages held by Hamas in exchange for Palestinian prisoners detained by Israel, as well as calls for an initial six-week pause in hostilities, during which Hamas would free 33 hostages. This would be followed by an extended ceasefire, dubbed "restoring a sustainable calm," during which the remaining hostages would be freed. The announcement came hours after Israel ordered the evacuation of eastern Rafah, signalling a potential imminent military operation there. Israel is reviewing the terms of the deal, with some officials signalling the "softened" proposal is not acceptable. The military will continue to operate in the Gaza Strip as it is examined further. An Israeli official speaking anonymously to the New York Times claimed that Hamas had rejected the latest proposal by Israel which had been on the table as of Sunday. (Financial Times)(New York Times)(Reuters)

2.

No 'slash and burn': Treasurer Jim Chalmers says the upcoming federal budget will prioritise fighting inflation in the near-term, while allowing for more spending and deficits in later years to boost economic growth. Chalmers' comments come as Treasury estimates suggest less government debt than expected. Gross debt is projected to reach $904 billion in 2023-24, $152 billion lower than previously forecast, saving around $80 billion in interest payments over the decade. "Debt will peak significantly lower than was projected at the time of the election thanks to our responsible economic management," Chalmers said. The treasurer clarified the budget will have two objectives: an initial focus on curbing inflation, followed by a shift towards growth-promoting investments later on. (Australian Financial Review)(Capital Brief)

3.

Off target: Shareholders in BP are anticipating the company will further scale back its climate targets, as new boss Murray Auchincloss is expected to adopt a more flexible approach towards oil and gas production. BP had previously committed to reducing its oil and gas production by 25% from 2019 levels by 2030, down from an initial target of a 40% cut. However, investors believe that Auchincloss is likely to be more pragmatic and focused on returns given the continued demand for oil and gas, the impact of the Russia-Ukraine war on energy prices and the higher interest rate environment affecting the profitability of renewable projects. One activist investor, Bluebell Capital Partners, is alleging that BP's management has hinted to shareholders about potentially increasing oil and gas production beyond the 2030 target. This represents a departure from the greener ambitions of former CEO Bernard Looney, who departed in January. (Financial Times)

4.

Gagged: The judge overseeing Donald Trump's criminal trial threatened to jail the former president if he continued violating a court-imposed gag order barring him from publicly commenting on witnesses and jurors. Justice Juan Merchan fined Trump USD1,000 ($1,510) and held him in contempt of court for the 10th time on Monday for violating a gag order. This particular violation was for claiming in a TV interview that the jury was unfairly stacked with "95% Democrats," which Merchan said questioned the trial's legitimacy and raised safety concerns. The judge said the USD10,000 in fines so far have failed to deter Trump's "continued, wilful" violations that are "a direct attack on the rule of law." He warned this was Trump's final chance, saying incarceration is "the last resort" that he wanted to avoid due to logistical challenges. (Financial Times)(Reuters)

5.

Model competitor: Microsoft is preparing its own large-scale AI model named MAI-1 which it hopes will compete with bleeding edge models from Google, Anthropic, and OpenAI, according to anonymous sources speaking to The Information. The USD650 million ($981 million) effort, overseen by former Google AI executive Mustafa Suleyman, represents Microsoft's first major attempt to develop a state-of-the-art AI model internally since its USD10 billion investment in OpenAI. With around 500 billion parameters, MAI-1 will be far larger than Microsoft's previous open-source models but still smaller than OpenAI's GPT-4, which clocks in at over 1 trillion parameters. The model is reportedly being trained on a vast server cluster using data compiled from sources like OpenAI's GPT-4 outputs and public web data. It is separate from Microsoft's products built in partnership with OpenAI, and its ultimate purpose depends on performance displayed during development. (The Information)

6.

Crypto action: Robinhood, the retail brokerage with over 23 million customers and USD119 billion ($179.5 billion) in assets under custody, has been warned by the SEC that it faces a potential lawsuit over its cryptocurrency business. The SEC sent Robinhood a notice over the weekend indicating a preliminary determination to recommend enforcement action which could lead to civil litigation, monetary penalties and limits on business activities. This move signals the SEC's continued crackdown on the crypto industry, as part of the agency's long running argument that many tokens are unregistered securities. Robinhood's chief legal officer expressed disappointment with the SEC's decision after years of attempts to work with the regulator, saying he "firmly believes" that the listed assets are not securities. (Financial Times)

7.

Blast off: Boeing's Starliner astronaut capsule is poised for its critical first crewed test flight to the International Space Station on Monday night US time. This long-delayed mission is crucial for Boeing to compete with SpaceX for NASA's lucrative contracts taking astronauts to orbit, as the company has struggled with years of setbacks, over USD1 billion ($1.5 billion) in cost overruns and crises in its commercial aviation business. While SpaceX's Crew Dragon has been flying NASA crews since 2020, Starliner's success would give the space agency redundant ride options and help advance Boeing's goal of operating commercial space stations after the ISS retires around 2030. This launch, set for 10:34pm ET, will carry veteran NASA astronauts Barry Wilmore and Sunita Williams. (Reuters)

8.

Valuation battle: Walt Disney and Comcast are seeking to hire a third independent financial adviser to resolve a significant valuation gap over Comcast's 33% stake in the streaming platform Hulu, which Disney is acquiring per a 2019 agreement. JPMorgan valued Hulu for Disney at around USD27.5 billion ($41.5 billion), the contractually set floor price, while Morgan Stanley appraised it over $40 billion for Comcast - a difference of more than the 10% threshold that would have allowed them to average the two banks' assessments. With the valuations too far apart, the companies are jointly selecting another bank to provide an independent valuation. The dispute arises from Comcast triggering the 2019 put option, requiring Disney to buy its remaining Hulu stake, which Comcast believes has significantly increased in value since the original deal. (Reuters)