Good morning. The European Union agreed to impose its toughest sanctions on Russia since its large-scale invasion of Ukraine, blocking attempts to revive the Nord Stream gas pipelines, lowering a price cap for Russian oil sales and hitting banks from third countries in a move that could exacerbate tensions with China.

• Converging views on sanctions? The sanctions package comes as President Trump has started increasing pressure on the Kremlin after months of seeking a peace deal between Ukraine and Russia. The White House now appears closer to the European view that the Kremlin won’t end the war. European capitals hope Washington will soon join them in tightening economic pressure on Moscow.
   
• What’s being targeted? The sanctions aim to weigh on Russia’s economy, which has withstood Western pressure for the past three years but now faces growing headwinds. In recent months, manufacturing activity is declining, consumers are tightening their belts, the state budget is strained and interest rates are at 20% to contain inflation.

Also see: U.K. Names Russian Spies and Denounces Moscow’s Sabotage Operations

Meta won’t sign EU’s AI code of practice, chief global affairs officer says.

Meta Platforms’ Chief Global Affairs Officer said the Facebook and Instagram owner wouldn’t sign the European Union’s code of practice for general-purpose artificial intelligence because it adds uncertainty and goes beyond the scope of AI legislation in the bloc.

What’s the law? The European Commission, the EU’s executive arm, last week published the final version of a code of practice for general-purpose AI that model providers can choose whether or not to sign. EU officials said the code included guidance on safety and security, transparency and copyright to help signatories comply with the bloc’s wide-ranging legislation on AI.

Congressional China critic concerned about sale of Nvidia’s H20 chip.

A leading congressional China critic is objecting to renewed sales of Nvidia’s H20 artificial-intelligence chip in the country, saying they could help substantially advance its AI sector.

Rep. John Moolenaar (R., Mich.), chairman of the House Select Committee on the Chinese Communist Party, in a letter to U.S. Commerce Secretary Howard Lutnick Friday, said allowing the sales “would…provide a substantial increase to China’s AI development.” He also asked the department how it plans to control access to the chips.

• As the federal government’s self-proclaimed “crypto week” comes to an end, the U.S. has emerged with two crypto bills moving to the Senate and one new piece of crypto legislation signed into law, according to MarketWatch. But it will be a long time before they take effect, report Barron's.
   
• The U.K.’s financial regulator is looking to further protect consumers using “buy-now, pay-later” loans, as it reins in new financial products under its authority.
   
• Now that investment scams, sometimes called pig butchering, are booming global operations, some Americans are demanding their banks and financial advisers do more to prevent the scams from happening.
   
• The Federal Trade Commission reverses an order barring Scott Sheffield from Exxon’s board, but the former Pioneer CEO blasts the company and says he is no longer interested in joining.
   
• FedEx is parting ways with its chief digital and information officer, Sriram Krishnasamy, after a monthslong internal investigation into the unit that he oversaw.
   
• The Federal Trade Commission has reopened and set aside the final consent orders for proposed acquisitions from Exxon Mobil and Chevron.
   
• China blocked Wells Fargo banker Chenyue Mao from leaving the country because she is required to assist in a criminal probe, China’s Foreign Ministry said Monday, marking Beijing’s first confirmation of the exit ban.

Why banks are on high alert about stablecoins.

Stablecoins are poised to become a part of the mainstream financial system, and banks are on high alert about how the cryptocurrency could threaten their business.

A major issue for banks is whether stablecoin issuers will lure away customer deposits. A Treasury Department report in April estimated that stablecoins could lead to as much as $6.6 trillion in deposit outflows, depending in part on whether issuers could offer yields similar to bank accounts.

Chinese rare-earth magnet exports surge after U.S. trade truce.

China’s exports of rare-earth magnets last month increased nearly threefold from the previous month after the country lifted some export controls on the critical industrial inputs following a deal with the U.S.

Still, export levels remain significantly lower than in previous years, prompting some Western companies to seek longer-term alternatives.

• Israel has increased its demands on Syria’s new leadership, insisting on a demilitarized zone and promising military intervention to protect the Druze minority.
   
• Iran suffered a significant setback when Israel killed top military leaders and the U.S. struck its nuclear facilities, but a pattern of high-value weapons seizures shows Tehran is making new efforts to arm its militia allies across the Middle East.
   
• Treasury Secretary Scott Bessent in recent days privately laid out his case to President Trump for why he believed Trump shouldn’t try to oust Federal Reserve Chair Jerome Powell, people familiar with the matter said.
   
• The Trump administration has moved Germany ahead of Switzerland for the next Patriot air-defense systems off the production line, paving the way for Berlin to send two Patriots it already has to Ukraine, according to three U.S. officials.
   
• Japan’s ruling coalition suffered a significant loss in a parliamentary election Sunday, a setback that risks derailing delicate trade negotiations with the U.S. just weeks before punishing tariffs are set to take effect.
   
• Silicon Valley is seeing a frenzy of talent raids among tech giants, with Meta leading the charge to recruit artificial-intelligence researchers.

• Fears of an economic downturn following President Trump’s tariffs have eased as consumer confidence and spending rebound.
   
• For the U.S. government, breaking up with Elon Musk is easier said than done.
   
• In the five months since President Trump first announced sweeping tariffs, Amazon quietly raised prices on low-cost products such as deodorant, protein shakes and pet care items, a Wall Street Journal analysis of nearly 2,500 items found.

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