Sweden set to join NATO alliance

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

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1.

NATO newcomer: Sweden has overcome its final obstacle to joining NATO, after Hungary’s parliament overwhelmingly approved its bid to become a member of the defence alliance. After two years of tense negotiations between the European nations, just six members of Hungary’s parliament rejected Sweden’s accession. Sweden and Finland both applied to join the alliance in May 2022 after Russia’s invasion of Ukraine, with Finland’s application approved last year. As the NATO treaty states, Sweden will have the protection granted under Article 5 which reads that an attack on one member is considered an attack against all. Sweden could join the defence alliance as early as this week. (The Guardian)(Reuters)

2.

APAC allure: Goldman Sachs has secured USD1 billion ($1.53 billion) from Mubadala Investment Co. to hunt for private credit deals across APAC. Mubadala is one of Abu Dhabi’s main sovereign wealth funds, with around USD300 billion in assets under management. Mudabala’s partnership with Goldman will invest across the region with a focus on India, in the latest show of Middle Eastern appetite for private debt. Investors from the region have previously felt private debt’s yields were too low, however interest rates and market growth have led to a shift in sentiment. (Bloomberg)(Reuters)

3.

AI expansion: French AI start-up, Mistral, has inked a partnership with Microsoft as the tech giant looks to expand its presence in the AI space beyond its deep connection with OpenAI. The financial details of the deal were not disclosed. As part of the partnership, Microsoft will help to bring its AI models to market. Mistral also made two new product announcements on Monday; the release of its most advanced language model ‘Mistral Large’ which will be made available through Microsoft’s Azure AI as its first distribution partner, as well as unveiling its new conversational assistant, le Chat Mistral. (Financial Times)(Mistral Large Press Release)

4.

Israel-Palestine: Palestinian Prime Minister, Mohammad Shtayyeh, and his government resigned overnight, as the Palestinian Authority come under intense scrutiny from the US to reform its governance of the Israeli-occupied West Bank, to ensure stability after the war concludes. Shtayyeh’s resignation requires approval from President Mahmoud Abbas, who may request that he stay on as a temporary caretaker. Abbas is expected to name former World Bank official, Mohammad Mustafa as the next Prime Minister. The news follows the death of a US airman on Monday, who set himself on fire in front of the Israeli embassy in Washington, to protest the Israel-Hamas War. Before lighting the fire, he said he would “no longer be complicit in genocide.” (Reuters)(BBC)

5.

Bidding war: Citadel Securities has been outbid for Credit Suisse’s investment bank unit in China by the fintech giant, Ant Group. Founded by Jack Ma, Ant group seeks to build a securities business using the bank’s operations. The purchase could prove thorny for UBS (which took control of Credit Suisse when it collapsed in 2023) as it would require regulatory approval. Ant has been the subject of significant regulatory attention in China over the last few years. While details of Ant’s bid have not been disclosed, Citadel’s bid submitted in December offered around 1.5-2 billion yuan ($320-$430 million). (Bloomberg)(Financial Times)

6.

Supermarket competition: The US Federal Trade Commission has sued to block Kroger’s USD25 billion bid to acquire rival Albertson’s, casting doubt over what would be one of the largest grocery deals to date. The antitrust enforcer argues that the deal would lead to higher food prices and lower wages, while the supermarkets have said the merger would help them compete against retail giants Amazon and Walmart. In terms of sales, Kroger and Albertsons are the largest and second-largest US grocery players, behind Walmart, operating over 2,700 and 2,300 stores respectively. The portion of American’s income spent on food has reached a three year high, and Biden recently took aim at grocery chains, alleging that stores are gouging shoppers and bringing in excess profits. (Wall Street Journal)

7.

Funding pulled: Super PAC, Americans for Prosperity Action, has pulled funding for Republican Presidential candidate Nikki Haley following her defeat to Trump in the South Carolina Primary on Saturday. While the group backed by billionaire Charles Koch said it would stop funding Haley’s campaign, it did not shift to backing Trump and will continue to “endorse” Haley while focusing its resources where it can make a difference – such as the race for US Congress. Since endorsing Haley late last year, the group has spent over USD32 million on her campaign. (Politico)(Bloomberg)

8.

AI goes rogue: Google’s bungled AI face-generating feature is set to return soon, after the feature was pulled following criticism over its inaccurate racial depictions. Head of Google DeepMind’s research division, Demis Hassabis, said that the company hopes to have the AI feature back online in the “next couple of weeks.” Google suspended Gemini's image generator shortly after it launched last week, explaining that the model was “way more cautious than intended.” Users posted screenshots of historically white-dominated scenes which instead used racially diverse characters generated by the feature. Critics then raised concerns over whether Google was over-correcting for the risk of racial bias in its AI. (Bloomberg)(Associated Press)