| Microsoft says China hackers broke into its email exchange server. Australia keeps its border shut for another three months. Wall Street poaching heats up. Here are some of the things people in markets are talking about today. Microsoft is urging customers to err on the side of caution after Chinese state-sponsored hackers broke into Microsoft Exchange Server using previously undiscovered flaws in the system. Microsoft has urged customers to download software patches to avoid being the victims of what it called "limited and targeted attacks." The hackers responsible are "a group assessed to be state-sponsored and operating out of China," Microsoft wrote in a blog post announcing the hack. Asian stocks looked set for a muted start after their U.S. peers retreated on concerns about excessive investor optimism. Treasuries climbed and the dollar weakened. Futures were little changed in Japan and Australia. Technology shares led losses in the S&P 500 Index as Apple and Tesla dragged down the Nasdaq 100. Benchmark Treasury yields dipped amid comments from Federal Reserve Governor Lael Brainard that bond-market volatility may further delay a pullback in the central bank's massive asset purchases. Oil fell further below $60 a barrel. Australia's international border will remain shut for at least another three months, as the government considers the Covid-19 situation overseas an "unacceptable public health risk." Meanwhile, U.S. President Joe Biden said there would be enough vaccines for every American adult by the end of May — bringing the target forward by two months. And how do all the billions of vaccine doses get shipped around the world? The security challenges involved — think kill switches, panic buttons and plainclothes guards — could come straight out of a James Bond movie plot. Wall Street poaching has heated up, with fintech and hedge funds on the hunt for new talent. Yes, Wall Street banks printed profits during the pandemic, but tech upstarts and investment firms are now offering some unusually attractive opportunities to seasoned professionals, including shots at multiplying their paychecks — an allure all the greater after banks showed restraint in doling out rewards for 2020. Exits are now proliferating as bonus season wraps up. A division chief making $10 million to $15 million at a top bank can make two to three times that taking the helm of a company, with more upside over time, one senior executive estimated. China's cheap and plentiful debt has given already fretting investors another reason to worry. China's top banking regulator jolted markets on Tuesday, warning investors there is a need to reduce the amount of debt on the books or the bubble could burst. China's largest stock has lost more than $100 billion in nine days. Central banks around the world are facing the challenge of how and when to step back stimulus measures that have been used to support economic recovery amid the pandemic. Bubble warnings around the world just keep getting louder.
What We've Been ReadingThis is what's caught our eye over the past 24 hours: And finally, here's what Cormac's interested in todayThe Euphoria trade is losing one of its founder members. No it's not lower-for-longer interest rates — the jury is still out on those despite last week's mini bond tantrum — but car superstar Tesla. The stock is back into bear-market territory and turned negative again for the year on Tuesday. The sheer scale of Tesla's rise in 2020 — it surged 743% — means there is a long way down even under a "normal" retracement scenario. It could fall 15% from here to a closely-watched Fibonacci support level and still remain in a technical uptrend. It's just that now the company is no longer an upstart but part of the establishment — over 4% of the Nasdaq 100, almost 2% of the S&P 500 and about 10% of the hugely popular ARK Innovation ETF.  Even the problems facing Tesla show how it is becoming more "mainstream," from supply chain woes to reported price cuts and increasing competition. But of course its valuation remains anything but normal — about 160 times forward earnings compared to 17 times for the global sector. Tesla has become hugely important for market sentiment, especially among retail investors, who are most at risk of catching a falling knife if the stock does come back down to earth. And if Tesla cracks, other euphoria trades could quickly go with it. Cormac Mullen is a Cross-Asset reporter and editor for Bloomberg News in Tokyo. | 
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