Good morning. Today we're talking about the mega-gaming deal vetoed, another bank teetering on the edge and Google vs Microsoft in the AI battle.

Big Stories

UK’s gaming veto

After months of back-and-forth the UK’s competition regulator announced it would block Microsoft’s $70bn takeover of Activision Blizzard, the video game giant behind ‘Candy Crush’, ‘Call of Duty’ and ‘World of Warcraft’. The tie up would have created the third-largest gaming firm in the world by revenue. However competition authorities in the UK, US and EU are concerned the deal would reduce competition and therefore be bad for consumers through higher prices, lower quality or less choice. In response Activision said Britain was “clearly closed for business” and vowed to fight the ruling.

Another bank on the brink

An American regional bank could be close to collapse after it revealed it suffered over $100bn in deposit outflows last quarter sending its share price to a record low. First Republic is taking drastic action to avoid becoming the latest casualty of the turmoil that engulfed the industry last month taking down Credit Suisse and Silicon Valley Bank. The bank is exploring selling $50bn to $100bn of assets and has cut staff pay by 25%. Founded in 1985, First Republic specialises in banking for wealthy clients but was seen as vulnerable due to the mismatch between the its assets and liabilities made worse by the rising interest rate environment.

Big Tech looks to AI

Alphabet’s Google and Microsoft, both recorded strong first quarter earnings driven by their established search and cloud-computing businesses. The two tech giants then used their time with investors to emphasise what’s next: artificial intelligence. Google and Microsoft are becoming rivals in the competition for the future of search but have different assessments of just how much disruption is in store for the market. Google executives encouraged investors to trust in the company’s long track record as the world’s leading search engine, and framed AI as just another shift in its constantly evolving business. Microsoft suggested that something much more dramatic is underway. Investors seemed to like Microsoft’s thesis better, sending its shares up as much as 10%, while Alphabet increased less than 2%.

Elsewhere...

Upping prices: Pret A Manger has raised the price of its monthly coffee subscription service by 20%.

Fighting back: Disney is suing Ron DeSantis, the governor of Florida, saying he had subjected it to “a targeted campaign of government retaliation”.

Potential landmark: Amazon could soon be forced to recognise a trade union in the UK for the first time.

Corporate apology: The new boss of the CBI says she is "profoundly sorry" to women who have been let down by the business lobby group.

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