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Iran nuclear deal ‘won’t outlast Trump’s first term’ in office

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A general view of streets in Tehran, Iran on the first anniversary of nuclear deal between Iran and world powers on January 16, 2017.

Fatemah Bahrami | Anadolu Agency | Getty Images

A general view of streets in Tehran, Iran on the first anniversary of nuclear deal between Iran and world powers on January 16, 2017.

In January, Trump demanded that France, Germany, the U.K. and the U.S. Congress “fix” the deal by May 12, by committing to tougher measures against Iran.

Eurasia Group’s Chairman Cliff Kupchan said in a note Wednesday that the agreement is unlikely “to survive President Donald Trump’s first term in office” and that the “re-imposition of U.S. secondary sanctions” – the sanctions that prevent other countries from doing business with Iran — is likely.

He said Iran, a country that has got its economy back on its feet thanks to the nuclear deal, would likely react with “rhetorical fury” to such a scenario and could “likely lash out” in the Middle East. He explained this could mean Iran using a more aggressive policy in Syria, Lebanon, Iraq, Yemen or — most dangerously — toward Saudi Arabia.

With no love lost between Trump and Iran, the political consultancy reduced the odds of the nuclear deal’s survival from 55 percent to 35 percent as it described the main dangers to the deal.

Why the deal is likely to fail

The first threat to the Iran nuclear deal comes in the form of the appointment of “Iran hawks” John Bolton as national security advisor (he replaces HR McMaster on April 9) and Mike Pompeo as secretary of state.

Kapchan said the combination of Bolton and Pompeo’s appointments, coupled with “insufficient progress by the European parties and the U.S. Congress on ‘fixing’ the nuclear deal, now make it unlikely that the agreement will survive President Donald Trump’s first term in office.”

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Toshiba business unit says it has been hacked by DarkSide: Reuters

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Toru Yamanaka | AFP | Getty Images

 A division of Toshiba said on Friday that its European business has been hit by a cyberattack, according to a Reuters report.

Toshiba Tec France said in a statement seen by Reuters that it was hacked on the evening of May 4. by Darkside, the same group the U.S. FBI blamed for the Colonial Pipeline attack.

The Toshiba unit, which sells self-checkout technology and point-of -sale systems to retailers, did not immediately respond to CNBC’s request for comment.

Toshiba Tec reportedly said that a “minimal” amount of work data was stolen in a ransomware attack. No leaks of the data have been detected so far and protective measures were put in place after the cyber-attack, the company said.

Ransomware is a type of malicious software that’s designed to block access to a computer system the victims pay the hackers a sum of money. It is not known if Toshiba Tec France has paid a ransom to the hackers.

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Chip shortage will last another quarter

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Xpeng Motors launches the P5 sedan at an event in Guangzhou, China on April 14, 2021. The P5 is Xpeng’s third production model and features so-called Lidar technology.

Arjun Kharpal | CNBC

BEIJING — Chinese electric car start-up Xpeng expects the global chip shortage will persist for at least another three months.

Automakers around the world have had to cut production due to a shortfall in semiconductors, or chips. High demand for electronics, U.S.-China trade tensions and a major factory fire have affected the highly specialized industry’s ability to manufacture enough chips.

“What we’ve seen is that this tight situation will continue for the next quarter or so,” Brian Gu, vice chairman and president of Xpeng, said Friday on CNBC’s “Squawk Box Asia.”

The challenge is “the visibility of chip supplies is by the minute,” Gu said. “We are paying very, very close attention to the situation. Right now, the impact is limited and it’s reflected in our guidance.”

Xpeng’s U.S.-listed shares fell nearly 4.9% in Thursday’s trading session despite the start-up reporting greater-than-expected revenue of 2.95 billion yuan ($456.7 million) for the first quarter.

The stock is now down nearly 45% for the year so far, but still holds gains of more than 50% from its IPO in August.

Xpeng expects to deliver between 15,500 and 16,000 vehicles in the second quarter. The company said it delivered 13,340 cars in the first three months of the year, topping its forecast for 12,500 cars.

Growing revenue from software

While car sales account for the majority of Xpeng’s revenue, the company noted first-quarter results were helped by customer demand for its assisted driving software. The start-up said it recorded revenue from the software for the first time after a rollout of an upgrade to paying customers in the first quarter.

Gu said on CNBC that more than 25% of customers have paid for the assisted driving software in the last month, up from 20% last quarter. He expects greater use of Xpeng’s software and lower vehicle production costs will increase the company’s margin in the near future.

Later this year, Xpeng plans to launch a second electric sedan, the P5, which includes support for the latest version of the start-up’s assisted driving software.

Vehicle margin, a measure of profitability, rose to 10.1% in the first quarter, up from 6.8% in the prior quarter. The company did report a year-on-year increase in net losses, of 786.6 million yuan in the first quarter, versus 649.8 million yuan during the same period last year. Research and development expenses rose 72.2% from a year ago to 535.1 million yuan.

Moving ahead into Europe

Xpeng pressed ahead with its European expansion plans in the first quarter by delivering more than 300 units of its G3 SUV to Norway, according to the company. The start-up had sent 100 of the cars to the market in December. Xpeng expects to begin delivering its P7 sedan to Norway in the second half of the year.

Competition in that overseas market is set to pick up with rival Chinese electric car maker Nio’s plans to open a showroom and begin deliveries in Norway later this year. Nio’s shares fell 7.3% Thursday and are down nearly 36% for the year so far.

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Dogecoin rallies on Elon Musk tweet, anticipated Coinbase listing

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Yuriko Nakao | Getty Images News | Getty Images

Dogecoin soared more than 40% early Friday after a tweet from supporter Elon Musk and as Coinbase said it would list the meme-inspired cryptocurrency.

The price of dogecoin rose to an intraday high of around 55 cents at 2:30 a.m. ET, according to data from Coin Metrics. It’s still down about 18% from a record high of nearly 67 cents only a week ago.

Musk tweeted Thursday that he was working with dogecoin developers to improve the efficiency of transactions.

On Wednesday, the Tesla CEO made a surprise announcement that his electric car firm would stop accepting bitcoin as payment due to concerns over its environmental impact.

That led to a brutal sell-off in cryptocurrencies, including dogecoin. Dogecoin had already fallen significantly after Musk’s appearance on Saturday Night Live, in which he called the digital coin a “hustle.”

Meanwhile, crypto exchange platform Coinbase said Thursday it would offer dogecoin support in the next six to eight weeks. Many crypto traders have flocked to the zero-fee investing app Robinhood to trade the meme token; now Coinbase’s move could lead to more trading activity.

Dogecoin isn’t taken very seriously by loyal bitcoin supporters. It started in 2013 as a joke, inspired by the “Doge” meme, but has since found a growing community online. Dogecoin is now the fourth-largest crypto by market value on CoinMarketCap, worth over $69 billion.

Financial experts warn that dogecoin is a highly speculative asset. It has stoked worries over a potential bubble in crypto markets — though some economists would say all cryptocurrencies are in a bubble.

Last week, Bank of England Governor Andrew Bailey warned crypto investors should be “prepared to lose all your money,” echoing a similar warning from the U.K.’s Financial Conduct Authority.

Bitcoin was marginally higher Friday, with the world’s biggest digital asset up about 0.3% at a price of $49,052. Ether, the second-biggest cryptocurrency, rose 3.6%, to $3,805.

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