Month: May 2023

U.S. stocks were mixed on Thursday, with the Dow Jones Industrial Average down 0.5% and the S&P 500 and NASDAQ Composite up 0.2% and 0.8%, respectively. Walmart Inc shares rose 1.3% after the retailer reported strong first-quarter sales and raised its full-year forecast. Cisco Systems Inc shares dipped 0.2% after the networking hardware maker reported a drop in orders.

New jobless claims of 242,000 were lower than expectations and lower than the prior week, another sign of a tight labor market. Existing home sales fell 3.4% in April from the prior month, well more than expected.

Two-thirds of futures traders expect the Federal Reserve to pause its interest rate hikes when it meets in June, as officials assess how well their actions to date have done to cool inflation. However, Dallas Federal Reserve President Lorie Logan said the economic data doesn’t justify a pause.

The debt ceiling is also in focus, with Congress and President Joe Biden needing to raise or suspend it in the next couple of weeks to avoid the possibility of default. Biden is in Japan for the G-7 meeting, where the debt ceiling will likely be a topic of conversation.

SQM, the world’s second-largest lithium producer, is set to start talks with state miner Codelco in the coming weeks about lithium projects. This follows the Chilean government’s plans for stronger state control of the metal, a key component for electric vehicle batteries.

The company saw its lithium sales volumes slip 15% over the first three months of 2023, but average prices surged 34% ahead of their level in the same quarter a year earlier. SQM reported prices of around $38,000 per metric tonne in the first quarter of 2022, rising to $59,000 per tonne by the last quarter.

CEO Ricardo Ramos said the company is positive about volumes for the second quarter and semester, citing a ramp up of activity in China. Revenues landed at $2.26 billion for January to March, up almost 12% from a year earlier, though profits dipped 6%.

The exact dates of the talks between SQM and Codelco will soon be shared with the market.

The EMEA Credit Derivatives Determination Committee (CDDC) will meet on Friday to discuss whether a bankruptcy credit event occurred at Credit Suisse after regulators wiped out the bank’s junior bondholders in a state-assisted merger with UBS. This question was raised by an investor on Thursday.

A credit event, if confirmed by the CDDC, could trigger a payout on credit default swaps which insure against losses from exposure to corporate or sovereign debt. On Wednesday, the CDDC ruled in response to another question that a Governmental Intervention credit event had not occurred, closing down one of the ways CDS holders were pursuing to secure a payout.

The Credit Suisse merger upended a long-established practice of giving bondholders priority over shareholders in a debt recovery, triggering hundreds of lawsuits. The outcome of the CDDC meeting will be closely watched by investors and market participants.

The lawsuit, filed in 2019, alleged that Google misled consumers about how it tracked their location data even when they had turned off the “Location History” setting. The lawsuit also alleged that Google failed to adequately disclose that it was still collecting location data through other settings.

Under the settlement, Google will pay $39.9 million to the state of Washington and implement reforms to increase transparency about its location tracking settings. The company will also provide consumers with more information about how their location data is used and how to control it.

Google has agreed to provide clear and conspicuous disclosures about its location tracking settings and to make it easier for consumers to control their location data. The company will also provide a dedicated page on its website that explains how its location tracking settings work.

The settlement is a victory for consumers and a reminder that companies must be transparent about how they use consumer data.

The French stock market closed higher on Thursday, with the CAC 40 and SBF 120 indices both rising 0.64%. The best performers of the session were STMicroelectronics NV and Renault SA, which rose 3.59% and 2.86%, respectively. The worst performers were Carrefour SA, Engie SA, and Orange SA, which fell 2.63%, 1.58%, and 0.86%, respectively. Rising stocks outnumbered declining ones on the Paris Stock Exchange by 326 to 197 and 91 ended unchanged. Gold Futures for June delivery was down 1.34%, while Crude oil for delivery in June fell 1.59%. The EUR/USD was down 0.70%, while the US Dollar Index Futures was up 0.72%.

Bankrupt crypto exchange FTX is seeking to claw back more than $240 million it paid for stock trading platform Embed. FTX alleges that former FTX insiders, including indicted founder Sam Bankman-Fried, misappropriated company funds to acquire stakes in Embed as part of the transaction. The crypto exchange closed on the Embed acquisition just six weeks before it collapsed into bankruptcy in November.

FTX’s new management has been seeking to recover assets to repay customers since the bankruptcy filing. U.S. law allows debtors to claw back payments made under certain circumstances shortly before a bankruptcy filing and use those funds to repay other creditors. FTX recently tried to sell Embed, but the highest bidder was Embed founder Michael Giles, who offered only $1 million.

FTX is now seeking to recover $236.8 million from Giles and Embed insiders, and $6.9 million from Embed minority shareholders. The crypto exchange claims that the $220 million it spent to acquire Embed was “wildly inflated relative to the company’s fair value,” and that Embed’s software was “essentially worthless.” FTX also paid Embed employees $70 million in retention bonuses, most of which went to Giles.

FTX’s lawsuits leave no doubt that the crypto exchange was taken advantage of in the Embed acquisition. The company is now seeking to recover the funds to repay customers and other creditors.

Toyota Motor Corporation has long argued that battery electric vehicles (BEVs) are not the only answer to climate change. On Thursday, the company’s top scientist, Gill Pratt, reiterated this point, warning that focusing solely on BEVs could lead some drivers to hold onto polluting vehicles. Toyota has instead advocated for the use of gasoline-electric hybrids, such as its pioneering Prius, as a more realistic choice for some markets and drivers.

Pratt noted that BEVs could make a positive difference in reducing climate change in countries such as Norway, which has a lot of renewable infrastructure. However, in other parts of the world, where coal is still used to produce power, hybrids are better for CO2 emissions.

Toyota seeks to sell 1.5 million battery-powered cars by 2026 and introduce 10 new fully electric models. The company has also argued that reaching carbon neutrality will mean the use of hybrid and fuel-cell vehicles. Akio Toyoda, Toyota’s former chief executive and current chairman, has lobbied the Japanese government to make clear it supports hybrid vehicles as much as BEVs.

Toyota’s stance on climate change is clear: battery electric vehicles are just one option, and hybrids and fuel-cell vehicles must also be considered.

Videogame publishers in the U.S. are seeing strong sales of popular titles such as Electronic Arts’ “FIFA” and Activision Blizzard’s “Call of Duty”. This signals resilience in the industry after it struggled last year with a slowdown in demand due to the COVID-19 pandemic. Take-Two Interactive Software Inc reported net bookings growth of 11-66% in the March quarter. Popular titles such as “NBA 2K23”, “Grand Theft Auto V” and “Call of Duty: Modern Warfare 2” were some of the top contributors to the growth.

Analysts believe the momentum could continue, with EA forecasting annual bookings in line with estimates as it gears up to launch a rebranded version of its soccer franchise this year. Take-Two is also expecting to launch several “groundbreaking titles” in 2024, fanning expectations for the release of the long-awaited sequel to “GTA V”. The company forecast net bookings of more than $8 billion for next year, which was above analysts’ estimates.

JPMorgan Chase & Co is seeking documents from Manhattan District Attorney Alvin Bragg as part of a lawsuit against the bank by women who say they were abused by the late financier Jeffrey Epstein. During a May 16 telephone conference, Bragg took part alongside lawyers for the victims, the bank, former JPMorgan private banking chief Jes Staley and the U.S. Virgin Islands. U.S. District Judge Jed Rakoff instructed Bragg to provide JPMorgan with a privilege log by Friday.

The request came to light after Deutsche Bank AG agreed to pay $75 million to settle a lawsuit by women who accused the German bank of facilitating Epstein’s sex trafficking. A spokesperson for Bragg did not immediately respond to a request for comment, and JPMorgan was not immediately available for comment.