Redwire chief operating officer Andrew Rush shows former NASA administrator Jim Bridenstine a spacecraft model of subsidiary Made In Space.
Redwire Space
Space infrastructure conglomerate Redwire Space is preparing to go public, announcing Thursday that it is the latest in a string of space firms to merge with a SPAC.
Redwire, formed last year by private equity firm AE Industrial Partners, is merging with special purpose acquisition company Genesis Park, which trades under the ticker GNPK. The deal is expected to close by the end of the second quarter, with the merger resulting in Redwire listing on the New York Stock Exchange.
A SPAC is essentially a shell company that raises money through an initial public offering to acquire another firm. Genesis Park’s stock rose more than 5% in premarket trading after the announcement, from its previous close of $9.87 a share.
“When you look around the industry now, you have a lot of the older traditional space players and you have a lot of these new space entrants, many of them are pre-revenue,” Redwire Chairman and CEO Peter Cannito told CNBC.
“Redwire is kind of the hybrid: We’re offering that middle ground of tremendous flight heritage but also the disruptive technologies.”
The company is focused on space infrastructure, which it estimates is currently a $15 billion market.
Redwire’s collection of firms includes technologies such as navigation sensors, solar arrays, deployable structure, in-space manufacturing and robotic arms.
The conglomerate expects to add about $170 million in cash to its balance sheet from the merger. This would include the proceeds from a $100 million PIPE — or private investment in public equity — round, joined by investors Senvest Management and Crescent Park.
The merger values Redwire at a $615 million enterprise valuation, according to the companies. Cannito noted that AE Industrial Partners will “stay significantly invested” following the merger, as its largest single shareholder.
Redwire’s year of acquisitions
Since AE formed Redwire last June, the company has been on a steady spree of acquisitions.
Redwire first acquired satellite component business Adcole Space and aerospace firm Deep Space Systems and then acquired Made In Space, a 3D-printing specialist.
The conglomerate also snapped up satellite technologies firm Roccor, engineering service LoadPath, modular spacecraft builder Oakman Aerospace and satellite mechanisms company Deployable Space Systems.
Altogether, according to Redwire, the combined management teams bring more than 50 years of space experience, with over 150 missions.
“We’ve taken a very differentiated approach to the market here by combining different companies with extraordinary flight heritage,” Cannito said.
These businesses are “used to being that premier mission partner to organizations that are deploying space-based capabilities,” he added, whether those partners are NASA, the Pentagon or others.
Redwire believes more deals may be ahead, Cannito said, noting that going public and “having that public equity as a currency significantly increases our attractiveness as an acquiring platform.”
“This allows us to be opportunistic, to continue our already proven track record of M&A,” Cannito said. “I think we’re going to be looking to do some bigger targets and this gives us the opportunity, with the flexibility to do that as required.”
Over $160 million projected 2021 revenue
Redwire brought in $119 million in revenue last year, which it expects to grow to $163 million in 2021. The company sees that accelerating to more than $1.4 billion in revenue by 2025, which Cannito said is based on its products.
“The dollars may pivot from government to commercial, and then our profile, in terms of our mix of customers, will pivot along with it. So it gives us a lot of staying power. It allows us to be flexible and to adjust and morph as the market changes,” Cannito said.
Redwire is cash-flow positive and expects to see its profitability continue and grow to nearly $200 million in free cash flow by 2025.
“Our strategy is really about being that premier mission partner,” Cannito said.
A composite image showing a Falcon 9 rocket booster lifting off and a few minutes later landing back near the launchpad.
SpaceX
Cannito also emphasized the reduction in cost of accessing space, as well as the growing number of rocket builders launching to orbit, as an additional catalyst.
“We’re really excited and have a lot of respect for what SpaceX has done with the introduction of economical reusable launch. We’re also excited about all of the other launch providers that have entered into that space and have now, and as a result of the increased competition, driven down the cost of launch. There’s a lot of options now,” Cannito said.
“I believe that there’s a direct correlation between reductions in launch costs and demand for space infrastructure,” he added.
Overall, Cannito pitched his company as a firm that’s in the middle of the space economy, which has grown to more than $420 billion.
BEIJING (AP) — China’s ruling Communist Party is lashing out at H&M and other clothing and footwear brands as it retaliates for Western sanctions on Chinese officials accused of human rights abuses in the Xinjiang region.
The attacks began when the party’s Youth League on Wednesday called attention on its social media account to an H&M statement in March 2020 that it would stop buying cotton from Xinjiang in China’s northwest. The Swedish retailer, in words also used by some other brands, said it was “deeply concerned” about reports of forced labor there.
On Thursday, a party newspaper, the Global Times, cited Burberry, Adidas, Nike and New Balance as having made “cutting remarks” about Xinjiang cotton as early as two years ago. A separate Global Times report cited what it said was a statement by Zara that it had a “zero-tolerance approach towards forced labor.”
Celebrities including Wang Yibo, a popular singer and actor, announced they were breaking endorsement contracts with H&M and Nike.
Beijing often attacks foreign clothing, auto, travel and other brands for actions by their governments or to pressure companies to conform to its official positions on Taiwan, Tibet and other sensitive issues.
Companies usually apologize and change websites or advertising to maintain access to China’s populous market. But Xinjiang is an unusually thorny issue. Western brands face pressure at home to distance themselves from possible abuses.
More than 1 million people in Xinjiang, most of them from predominantly Muslim ethnic groups, have been confined to work camps, according to foreign researchers and governments. Beijing denies mistreating them and says it is trying to promote economic development and stamp out radicalism.
On Monday, the 27-nation European Union, the United States, Britain and Canada jointly announced travel and financial sanctions on four senior Chinese officials blamed for abuses in Xinjiang.
Beijing retaliated by saying it would impose unspecified penalties against European legislators and a German researcher who has publicized information about the detention camps.
H&M’s statement last March cited a decision by the Better Cotton Initiative, an industry group that promotes environmental and labor standards, to stop licensing Xinjiang cotton because it was “increasingly difficult” to trace how it was produced. In September, H&M announced it would stop working with a Chinese manufacturer that was accused of using forced labor in a unit unrelated to the Swedish brand.
In January, Washington imposed a ban on imports of cotton from Xinjiang, a major supplier to clothing producers for Western markets.
China’s official outrage has focused on Europe, possibly because relations with the EU were relatively amicable amid rancor with Washington over trade disputes and accusations of Chinese spying and technology theft.
Official criticism of H&M reflected that tone of grievance at being hurt by a friend.
“How can H&M eat Chinese rice and then smash China’s pot?” state television said in a commentary on Wednesday.
On its social media account, H&M Group said the company “doesn’t represent any political standpoint” and “respects Chinese consumers.”
The company said it deals with 350 Chinese manufacturers to make products that “comply with the principles of sustainable development.” H&M said it “is committed to long-term investment and development in China.”
On Thursday, H&M products were missing from China’s two most popular online retailers, Alibaba Group’s TMall and JD.com. News reports said they were removed due to public criticism over its Xinjiang statement. Spokespeople for Alibaba and JD didn’t immediately respond to requests for comment.
Internet users pointed to clothing brands Uniqlo of Japan and The Gap of the United States as other possible offenders. It was unclear how many of those accounts were members of the public and how many were operated by the ruling party’s vast propaganda apparatus.
Pop star Wang Yibo’s announcement that he was quitting as a Nike “brand ambassador” didn’t mention Xinjiang. It said he “firmly resists any words and actions that pollute China.”
Others including singer and actress Song Qian, a former member of Korean pop group f(x) who also is known as Victoria Song, and actor Huang Xuan announced they would end endorsement contracts with H&M. Actress Tang Songyun said she was breaking ties with Nike.
Chinese athletic shoe brand ANTA announced it was pulling out of BCI, the industry cotton group.
Stamps.com: “I think you should sell it. I think it’s a stay-at-home, work-at-home, not-as-heavily shorted stock, and there’s better ones out there.”
Cemex: “Cemex is always a cheap stock and never seems to be able to deliver, frankly. Mexican cement, but I do believe Mexico is about to have a resurgence. Six bucks? Yeah, I’d do a little.”
JFrog: “They didn’t blow their numbers away. You know when you have that high multiple, you’re going to have to blow the numbers away, and they did not do it … I have to say no to the JFrog.”
Bank of America: “It’s the kind of stock that people want. I mean, there’s no doubt about it, but I do feel that … people are starting to regroup and say, ‘let’s just pull away from this market, let it come down a little,’ but Bank of America is very, very inexpensive as the group is, even after this run.”
Devon Energy: “I don’t like the oils, but [CEO] Rick Muncrief he is [ca-ching, ca-ching], so take it for what it’s worth.”
“Trump Hotels are no longer part of the Virtuoso network,” the company said.
The luxury travel agency declined to elaborate on why it made the decision, saying they “consider many variables when reviewing both existing and new network participation. Out of respect for all involved parties, and as a general policy, we do not share comments regarding our non-renewal and exit decisions.”
Zenger News, a digital wire service, was the first to report the news.
Virtuoso operates a network of more than 1,100 travel agencies and roughly 22,000 travel advisers in 50 countries. The travel agency enjoys preferred relationships with a number of “hotels and resorts, cruise lines, airlines, tour companies and premier destinations.” Advisers usually work with high-end clients to provide them with “unique experiences, special values, complimentary perks, VIP treatment and rare access.”
This comes as Donald Trump’s businesses have taken a hit in the past year. Even before Trump left office and his role in the US Capitol insurrection brought further complications to his businesses, the pandemic was putting considerable strain on Trump Organization properties worldwide.
The Trump Organization did not immediately respond to a request for comment.
— CNN’s Brian Todd and Paul LeBlanc contributed to this report.
Janet Yellen earlier this month. Ms. Yellen’s team at Treasury is working on developing guidance on how the $200 billion allocated for states and cities can be used.Credit…Al Drago for The New York Times
Treasury Secretary Janet L. Yellen said on Wednesday that she is grappling with a host of “thorny” issues related to a provision in the $1.9 trillion stimulus package that restricts states from using federal aid money to fund tax cuts, suggesting that the looming legal battle over the matter could be long and complicated.
At a Senate Banking Committee hearing, Ms. Yellen said her team at the Treasury Department was working on developing guidance on how the $200 billion allocated for states and cities can be used.
The Treasury Department has said the intent of the law is for the relief money to pay for matters related to the coronavirus pandemic, not to subsidize tax cuts.
But Ms. Yellen acknowledged that the issue is a “thorny” one.
“We will have to define what it means to use money from this act as an offset for tax cuts,” Ms. Yellen said. “Given the fungibility of money, it’s a hard question to answer.”
The Treasury Department has 60 days from when the law was enacted to craft guidance on how the money can be spent. Ms. Yellen said she believes that states and cities should have a lot of flexibility in how they deploy the funds.
Last week, the Ohio attorney general sought a preliminary injunction that would bar the federal government’s ability to enforce what he described as the “tax mandate.”
Several Republican governors and 21 Republican attorneys general have asked for clarification on the provision. Ms. Yellen wrote a letter to the attorneys general on Tuesday evening explaining why there are restrictions on the use of the funds. She foreshadowed the legal argument that Treasury might use if litigation moves forward.
“It is well-established that Congress may place such reasonable conditions on how states may use federal funding,” she wrote. “Congress includes those sorts of reasonable funding conditions in legislation routinely, including with respect to funding for Medicaid, education and highways.”
Senator Mike Crapo, Republican of Idaho, urged Ms. Yellen to provide clear guidance for states quickly.
“It seems to me the states are hamstrung right now. They can’t do anything,” he said.
Jerome H. Powell, left, and Janet Yellen, with Ben Bernanke, in 2019.Credit…Jessica Mcgowan/Getty Images
America’s top two economic officials told senators on Wednesday that the economy is healing but still in a deep hole, and that continued government support is providing a critical lifeline to families and businesses.
Jerome H. Powell, the Federal Reserve chair, and Janet L. Yellen, the Treasury Secretary and Mr. Powell’s immediate predecessor at the Fed, are testifying before the Senate Banking Committee. Their prepared comments echoed their testimony before House lawmakers on Tuesday.
Mr. Powell said in his remarks that the government averted the worst possible outcomes in the pandemic economic recession with its aggressive spending response and super-low Fed interest rates.
“But the recovery is far from complete, so, at the Fed, we will continue to provide the economy the support that it needs for as long as it takes,” he said.
Ms. Yellen, who pushed hard for the recently-passed $1.9 trillion relief package, said that responding to a crisis with a needed surge of temporary spending without paying for it was “appropriate.”
“Longer-run, we do have to raise revenue to support permanent spending that we want to do,” she said.
She said that expanded unemployment insurance, part of the recent relief package, does not seem to be discouraging work and is needed at a time when the labor market is not at full strength.
“While unemployment remains high, it’s important to provide the supplementary relief,” Ms. Yellen said, noting that the aid lasts until the fall. She said that as the economy recovers, the aid “should be phased out.”
The Biden administration is also making plans for a $3 trillion infrastructure package. The fact that the government is spending so much, and contemplating spending more, at a time when the economy is recovering has stoked concerns about inflation among some economists and lawmakers.
Some onlookers fear that the Fed, which has interest rates at rock-bottom and is buying bonds in big quantities to help the economy, might be too slow to react to higher prices.
“I do worry that the Fed may be behind the curve when inflation inevitably picks up,” Senator Patrick J. Toomey, Republican from Pennsylvania, said during his opening remarks.
But Mr. Powell has consistently pushed back on concerns about runaway inflation, and did so again on Wednesday.
“We think the inflation dynamics that we’ve seen around the world for a quarter-century are essentially intact — we’ve got a world that’s short of demand, with very low inflation,” Mr. Powell said. “We think those dynamics haven’t gone away overnight, and won’t.”
Asked specifically about potential supply and demand mismatches — particularly in the context of a ship that had gotten stuck in the Suez Canal, but also in general as the economy reopens — he struck a similarly unconcerned tone.
“A bottleneck, by definition, is temporary,” he said.
He also batted back concerns about a recent increase in market-based interest rates. The yield on 10-year Treasury notes, a closely watched government bond, has moved up since the start of the year.
“Rates have responded to news about vaccination, and ultimately, about growth,” Mr. Powell said. “That has been an orderly process. I would be concerned if it were not an orderly process, or if conditions were to tighten to a point where they might threaten our recovery.”
An H&M store in Beijing. A statement the company posted last September stirred outrage on Chinese social media this week.Credit…Florence Lo/Reuters
The fashion retailer H&M is facing a potential boycott by millions of consumers in China after a statement by the company expressing deep concerns over reports of forced labor in Xinjiang stirred a social media storm this week.
The statement, which can be found on the website of the Swedish retailer, was posted last September after growing global scrutiny around use of Uyghur forced labor in the Xinjiang region of China.
In it, H&M said that it was “deeply concerned by reports from civil society organizations and media that include accusations of forced labor and discrimination of ethno-religious minorities” in Xinjiang and that it had ended sourcing cotton from growers in the region.
More than eight months later, and in the wake of sanctions by Western countries against China for its treatment of Uyghurs, H&M is now facing an angry online backlash from Chinese consumers. The outrage has been stoked by commentsfrom celebrities and groups like the Communist Youth League, an influential Communist Party organization.
“Want to make money in China while spreading false rumors and boycotting Xinjiang cotton? Wishful thinking!” the group said in a post, echoing one of the People’s Liberation Army’s statements that called H&M’s statement “ignorant and arrogant.”
By Wednesday evening, at least three major Chinese e-commerce platforms — Pinduoduo, Jingdong and Tmall — had removed H&M from search results and withdrawn its products from sale, underscoring the pressures faced by foreign companies doing business in China while navigating political and cultural debates ranging from the country’s sovereignty to its checkered human rights record.
On Wednesday night, H&M China responded with a post on the Sina Weibo microblogging site, saying that the company did not “represent any political position.”
“H&M Group respects Chinese consumers as always,” the statement said. “We are committed to long-term investment and development in China.”
H&M is the world’s second-largest fashion retailer by sales, and China is its fourth-biggest market.
On Monday the European Union, United States, Britain and Canada announced sanctions on Chinese officials in an escalating row over the treatment of Uyghurs, in Xinjiang. Roughly one in five cotton garments sold globally contains cotton or yarn from the region, where authorities have used coercive labor programs and mass internment to remold as many as one million Uyghurs, Kazakhs and other largely Muslim minorities into model workers obedient to the Communist Party.
State broadcaster CCTV criticized H&M, and said that it was “a miscalculation to try to play a righteous hero.” H&M, it said, “will definitely pay a heavy price for its wrong action.”
Claire Fu contributed reporting.
Stat, which was founded by the Boston Red Sox owner John W. Henry, is produced by the parent company of The Boston Globe newspaper, which is owned by Mr. Henry and his wife, Linda Pizzuti Henry.Credit…Philip Keith for The New York Times
Journalists at Stat, the medical and science news website lauded for its pandemic coverage, will join the Boston Newspaper Guild, union representatives said in a statement Wednesday.
Stat, headquartered in Boston, focuses on science, health and biotech journalism and has close to 40 editorial staff members. It was one of the first outlets to extensively cover the outbreak of the coronavirus in January 2020 and saw a boost in traffic and revenue in the past year as its ambitious coverage gained attention. Helen Branswell, Stat’s infectious disease reporter, won the 2020 George Polk public service award for her work covering the pandemic.
Damian Garde, a biotech reporter for Stat, said in an interview that workers hoped union protections would help make Stat an even more attractive and competitive employer.
“When people look at the Stat trajectory, they point to my colleague Helen Branswell’s very prescient coverage ahead of the Covid-19 pandemic really becoming what it would become,” he said. “And I think one of the lessons there is: If you invest in people like Helen Branswell, you, too, can have prescient coverage.”
Stat, which was started in 2015 by the Boston Red Sox owner John W. Henry, is produced by Boston Globe Media Partners, the parent company of The Boston Globe newspaper, which is owned by Mr. Henry and his wife, Linda Pizzuti Henry. The two publications have separate staffs.
Scott Steeves, the president of the Boston Newspaper Guild, said in a statement that the addition of Stat workers would mean a stronger voice for the union.
“At a time when independent journalism is so important, Guild members strive to deliver the highest-quality news product possible while also standing together to ensure economic and workplace protections,” he said.
Mr. Garde said the union eligibility of certain Stat employees was still under discussion as part of the ongoing negotiations between the Boston Newspaper Guild and Globe management. Globe union employees have been without a contract for more than two years as a standoff over a new contract continues.
Globe management did not immediately respond to a request for comment.
The Boston Newspaper Guild is affiliated with the NewsGuild, which also represents New York Times employees.
Elon Musk, the chief executive of Tesla, said on Twitter that the company would accept Bitcoin as payment for cars in the United States.Credit…Brendan Smialowski/Agence France-Presse — Getty Images
Elon Musk, the chief executive of Tesla who recently added “Technoking” to his title, said on Wednesday that the company would accept Bitcoin as payment for cars in the United States, a move that is at odds with the company’s image as an environmentally friendly electric-car maker.
Tesla will hold the digital currency, rather than convert payments to dollars, and handle the crypto transactions internally, Mr. Musk said.
“Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency,” Mr. Musk explained in a tweet. That means when someone buys a Tesla with Bitcoin, the price of the car could well rise — or fall — over time. In other words, Tesla is turning one-time payments into assets with shifting value, or, essentially, investments.
Buyers outside the United States will have the option to use Bitcoin “later this year,” Mr. Musk said.
Mr. Musk’s embrace of Bitcoin is hailed by many cryptocurrency enthusiasts, but the digital currency’s affect on climate change has come under increasing scrutiny.
“Bitcoin uses more electricity per transaction than any other method known to mankind, and so it’s not a great climate thing,” Bill Gates recently told The New York Times. Depending on the study, the annual carbon emissions from the electricity required to mine Bitcoin and process its transactions are equal to the amount emitted by all of New Zealand. Or Argentina.
There is also an electronic waste problem associated with bitcoin mining, argues Alex de Vries, an economist who created the Bitcoin Energy Consumption Index and tracks the unintended consequences of digital trends. Bitcoin mining is done with highly specialized equipment that has a short life span, and the tools cannot be repurposed, making investment in the digital currency even more problematic from an environmental perspective, he told The Times.
Mr. Musk said last month that the company bought $1.5 billion in Bitcoin for its treasury. The announcement on Wednesday confirms speculation in the crypto community that Tesla would not simply contract out payments to a third-party processor and treat Bitcoin like dollars.
Since Tesla’s Bitcoin purchase in February, the price of Bitcoin and other cryptocurrencies has soared to record highs, but trading has been volatile.
Analysts are pleased with the symbolism at least. “This is a seminal moment for Tesla and for the crypto world,” wrote Daniel Ives and Strecker Backe, analysts at the investment firm Wedbush. “This morning’s news formalizes the strategy of Musk and Tesla diving into the deep end of the pool of bitcoin and crypto from a transactional perspective.”
This bridge can be yours for $69 million.Credit…Open Sea
The comedian John Cleese is selling a digital sketch that comes with a nonfungible token, or NFT, to authenticate its authorship via blockchain technology. It’s a joke, sort of.
Evoking a classic con, the sale of the Brooklyn Bridge, the Monty Python actor is auctioning an image of the bridge by “The Unnamed Artist John Cleese,” with bidding running through April Fools’ Day. “I don’t make the jokes,” Mr. Cleese told the DealBook newsletter. “I just point them out.”
The project highlights the hyper-commodification of art in a frenzied market. Christie’s recently held its first NFT auction, selling the work of an artist known as Beeple for $69,346,250. That’s how much Mr. Cleese is asking for the sketch (plus 50 cents) if a bidder wants to “buy it now.” He’ll split the proceeds evenly with his partners: a comedy writer, an animator and a law professor doubling as crypto consultant.
The highest bid for Mr. Cleese’s work is now about $36,000. “I think it’s very funny,” Mr. Cleese said. “At the same time, we might make some money.”
Hello! It is time you meet my alter ego “Unnamed Artist” I’m delighted to offer you the opportunity of a lifetime. I’m selling my 1st NFT. Though bidding starts at 100.00, you can “BUY IT NOW” for 69,346,250.50! https://t.co/Vuyx4trvPE pic.twitter.com/aC4oSVfGHF
— The Unnamed Artist (@JohnCleese) March 19, 2021
“Some things are worth pointing out, and some are not,” Mr. Cleese said. The Beeple sale was notable because it revealed a “mad world,” he added, with people disconnected from meaningful emotional experiences, like seeing a painting at a gallery. Yet the 81-year-old also conceded that someone younger, for whom the line between the physical and digital worlds is more blurred, could have feelings about an NFT.
The art world can’t afford to dismiss NFTs, Mr. Cleese said. Nor can he. By mocking the craze, he is now implicated in the thing he finds absurd — just how he’s made a living as a comedian.
Robinhood and its chief executive, Vlad Tenev, have faced scrutiny over the role the app played in the GameStop trading frenzy. But investors have stood by the company.Credit…House Financial Services Committee
Robinhood, the stock-trading app, said on Tuesday that it had filed a draft registration to go public, joining a wave of financial technology companies that plan to list on the stock market or that have raised new funding.
The exact timing or price of the offering has not been set. Private market investors have valued Robinhood at roughly $12 billion and some have speculated its initial public offering could top $20 billion. It is working with Goldman Sachs on its offering, a person familiar with the company said.
Robinhood used a process known as filing confidentially that allows it to keep some details under wraps in the early part of going public.
Financial technology companies have been booming. Coinbase, a cryptocurrency start-up, is expected to list its shares in the coming weeks, with investors estimating that it could be worth as much as $100 billion. Stripe, a start-up that offers payment processing services, raised funding this month that valued it at $95 billion, making it the most valuable start-up in the United States.
Robinhood began making plans to go public last year after its growth spiked in the pandemic, with some people using their stimulus checks to day trade.
But it paused those plans in January when a group of online traders banned together to drive up the stock prices of so-called “meme stocks” like GameStop, causing short-sellers to lose money and forcing the exchanges to halt trading of some stocks.
Amid the frenzy, Robinhood restricted the trading of some stocks, outraging many of its users and drawing nearly 50 lawsuits and multiple probes from regulators. Vlad Tenev, the company’s chief executive, was called to testify in front of Congress about the market frenzy and Robinhood’s role in it.
Despite the anger, the GameStop incident boosted Robinhood’s name recognition and led to more downloads of its app, which is popular because it charges no fees for stock trading. Robinhood has been criticized for making day trading into a gambling-like game, where investors don’t always understand the risk they are taking on.
Private investors have stood by the Menlo Park, Calif.-based company. During the frenzy, Robinhood raised two rounds of emergency funding totaling $4.4 billion in a matter of days.
Stocks on Wall Street rebounded on Wednesday, while shares in Europe were slightly lower. Oil prices climbed, also rebounding from a recent decline, after a container ship blocked traffic in the Suez Canal.
United States
The S&P 500 index rose about half a percent in early trading, while the Nasdaq composite was flat.
Yields on government bonds ticked higher. The yield on 10-Year Treasury notes was at 1.64 percent. Yields had declined on Tuesday after Jerome H. Powell, the Federal Reserve chair, continued to play down the prospects of high sustained inflation.
Intel rose about 2 percent in early trading. The company said on Tuesday that it planned to spend $20 billion on two new chip factories near facilities in Arizona amid a global shortage.
GameStop dropped about 20 percent after quarterly earnings released on Tuesday missed expectations and the company said in a filing it could sell additional shares.
Tesla’s shares were slightly lower after Elon Musk said the carmaker would accept Bitcoin, the cryptocurrency, as payment for cars in the United States.
Europe
The eurozone purchasing managers’ index for manufacturing and services for March was above 50 — the line between contraction and expansion — for the first time since October. Germany manufacturing output was at a record high and the index for British services rose to 56.8, well above expectations for a reading of 51.
The benchmark Stoxx Europe 600 index was 0.2 percent weaker, after opening 0.7 percent down. The FTSE 100 index in Britain was down 0.3 percent.
Data showed that inflation in Britain unexpectedly fell to an annual rate of 0.4 percent in February from 0.7 percent the month before. Analysts at RBC said they still expected inflation to rise in coming months, but the lower-than-expected February data reflected the pandemic’s disruption to normal seasonal price patterns. For example, clothing prices didn’t rise in the new year after the traditional sales period.
Oil Prices
Oil prices rose after a container ship got stuck in the Suez Canal, blocking traffic in one of the world’s busiest shipping arteries. The canal is important for the movement of oil as it travels from the Persian Gulf region to Europe and North America. Brent crude futures rose as much as 3.3 percent, to just under $63 a barrel, but then eased slightly after reports that the vessel had been refloated and workers were hoping to clear a space for shipping to resume.
Intel’s new chief executive is doubling down on chip manufacturing in the United States and Europe, a surprise bet that could please government officials worried about component shortages and dependence on factories in Asia. Patrick Gelsinger, who took the top job in February, said on Tuesday that he planned to spend $20 billion on two new factories near existing facilities in Arizona. He also vowed that Intel would become a major manufacturer of chips for other companies, in addition to producing the processors that it has long designed and sold.
Walt Disney Studios on Tuesday pushed back the release dates of six movies, including “Black Widow,” a hotly anticipated Marvel prequel. In addition, “Black Widow,” now scheduled for July 9 instead of May 7, and another major Disney movie, “Cruella” (May 28), will premiere on Disney+ at the same time they arrive in theaters. Disney pulled “Luca,” the next Pixar film, from theatrical release entirely, saying it would debut exclusively on Disney+ on June 18. The other movies that were delayed include “Free Guy,” an action-comedy starring Ryan Reynolds as a bank teller who finds himself inside a video game; “Shang-Chi and the Legend of the Ten Rings,” a Marvel extravaganza starring Simu Lieu alongside Awkwafina; and “Death on the Nile,” an all-star remake based on the Agatha Christie mystery.
Shares of GameStop tumbled in after-hours trading on Tuesday as quarterly earnings missed expectations and the company said in a filing it could sell additional shares. The company’s stock was down roughly 12 percent shortly after 6 p.m. The stock began to slide after the company said in a separate filing with the Securities and Exchange Commission that it was evaluating whether to sell additional stock “primarily to fund the acceleration of our future transformation initiatives.”
Boeing (BA) lost out on a Pentagon contract late Tuesday to develop a new interceptor to protect the U.S. against intercontinental ballistic missile threats. But Boeing stock rose Wednesday.
X
Instead, Lockheed Martin (LMT) and Northrop Grumman (NOC) won the Next Generation Interceptor contract for technology development and risk reduction.
Lockheed’s contract is worth $3.7 billion through August 2025, and Northrop’s is worth $3.9 billion through May 2026. The two defense giants will later compete against each other for a future procurement contract.
“By planning to carry two vendors through technology development, MDA will maximize the benefits of competition to deliver the most effective and reliable homeland defense missile to the warfighter as soon as possible,” Vice Adm. Jon Hill, director of the Missile Defense Agency, said in a release. “Once fielded, this new homeland defense interceptor will be capable of defeating expected threat advances into the 2030s and beyond.”
Lockheed also worked with Aerojet Rocketdyne (AJRD), which Lockheed is buying. Northrop Grumman teamed up with Raytheon Technologies (RTX).
IBD Live: A New Tool For Daily Stock Market Analysis
Boeing Stock
Shares rose 2.3% to 246.70 on the stock market today. Boeing stock is back above a 244.18 buy point, according to MarketSmith chart analysis. Lockheed stock gained 2.2%, and Northrop added 2.2%.
The Next Generation Interceptor will replace the interceptors for the current Ground-based Midcourse Defense system, which is located in Fort Greely, Alaska and Vandenberg Air Force Base, Calif.
Boeing is the prime contractor for that system and won a $6.6 billion contract in 2018 to replace it. But the Pentagon canceled the Redesigned Kill Vehicle program last year over technological issues.
“Boeing is disappointed the U.S. Missile Defense Agency did not advance our team to the next phase of competition in the development of the Next Generation Interceptor competition,” the company said in a statement.
“Our proposal to upgrade the current Ground-based Midcourse Defense system leveraged the company’s 60-plus years of experience with missile and weapon systems to deliver an NGI solution that emphasized an innovative design with enhanced flexibility and modularity.”
Follow Gillian Rich on Twitter for aviation news and more.
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Satellite imagery captured on March 23, 2021 shows the cargo container ship Ever Given blocking the Suez Canal in Egypt.
Planet Labs
Satellite imagery gives another perspective on the developing situation in Egypt’s Suez Canal, where a mega cargo container ship was turned sideways and became stuck, blocking the busy passageway.
Imagery captured on Tuesday by a Planet Labs’ Dove satellite showed the stranded ship, called the Ever Given, in the canal.
The Ever Given is about 1,300 feet long (or nearly a quarter mile) and 193 feet wide. The ship weighs about 220,000 tons and is capable of carrying as many as 20,000 containers.
Cropped satellite imagery captured on March 23, 2021 shows the cargo container ship Ever Given blocking the Suez Canal in Egypt.
Planet Labs
Suez port agent GAC told Reuters that as of Wednesday morning, Ever Given had been partially refloated and moved against the bank of the canal.
“The vessel remains aground as of this moment of time, but efforts to re-float her continue in close cooperation with the Suez Canal Authority,” a Bernhard Schulte Shipmanagement spokesperson told CNBC around 11:45 a.m. ET. The firm is the technical manager of Ever Given.
The ship’s Taiwan-based operator Evergreen Marine Corp. said in a statement that the Ever Green ran aground after being overcome by strong wind as it entered the Suez Canal from the Red Sea. The operator noted that none of its containers had sunk.
— CNBC’s Pippa Stevens, The Associated Press and Reuters contributed to this report.
WFT owner Dan Snyder, center, before a game between the Washington Football Team and the New York Giants at FedEx Field in Landover, MD on November 8, 2020.
John McDonnell | The Washington Post | Getty Images
Washington Football Team owner Dan Snyder is close to buying the minority shares of his club for more than $800 million, according to the New York Times.
Snyder will seek approval from National Football League owners to take on $450 million in debt to buy the remaining 40.5% of the club’s shares for $875 million, the Times reported on Wednesday. The move would give Snyder complete control of the WFT.
NFL owners are scheduled to vote on Snyder’s debt request next week.
“The transaction is subject to three-fourths approval of full membership-24 of 32 clubs,” the NFL said in a statement. “The annual league meeting is slated for Tuesday and Wednesday, at which time there would be a vote.”
Owners of the minority shares include FedEx CEO Frederick Smith, who pushed for the team to drop its former name last year. Team sponsors, including Bank of America, Nike, Pepsi, and FedEx, which owns the naming rights to the team’s home stadium in Maryland, all came out against the previous team name. It prompted Snyder, 56, to change the name.
The issue was a part of a rocky 2020 centered around alleged misconduct in the club’s workplace.
The team is currently under an independent investigation by attorney Beth Wilkinson after a report last summer in The Washington Post, which alleged sexual harassment and mistreatment of female employees.
Jason Wright
Source: Washington Football Team
Snyder hired the NFL’s first Black team president in Jason Wright, who replaced Bruce Allen. In an interview with CNBC last August, Wright said the team would repair its damaged image.
“I’m glad we are where we are now,” Write said. “I think we’re in the right spot.”
Last season, the WFT made the playoffs for the first time since 2015, falling to eventual Super Bowl champion Tampa Bay Buccaneers in an NFC wildcard game.
Snyder took over ownership when he purchased the team for $800 million in 1999. The WFT is now worth $3.5 billion according to Forbes, who noted the club brings in roughly $500 million in annual revenue.
“When you hear more calls for firearm restrictions, we have observed gun sale increases primarily from people buying before they’re not able to,” said Rob Southwick, founder of the market research firm Southwick Associates.
It’s too soon to know how the back-to-back shootings will affect sales of firearms, industry experts say. Reliable figures from federal background checks won’t be released until next month. But if history is any guide, gun dealers and manufacturers can expect a surge in demand.
“I don’t need to wait another minute, let alone an hour, to take common-sense steps that will save lives in the future,” Biden said, listing a ban on assault weapons and high-capacity magazines, as well as strengthening the background check system by closing loopholes, as areas he would like to see Congress act.
The pattern of rising gun sales following mass shootings has held true regardless of which political party is in power: Fears of future restrictions prompt gun owners to stock up.
Gun sales surged in January 2013 in the weeks following the Sandy Hook Elementary school shooting that left 27 dead, most of them children. At the time, former President Barack Obama and Democrats in Congress pushed for stricter federal gun control measures that ultimately stalled in the US Senate.
Similarly, gun sellers said they were inundated with orders for bump stocks after the devices were used in the Las Vegas massacre that killed 58 people in October 2017.
Soon after that shooting, President Donald Trump vowed to outlaw bump stocks -— attachments that essentially allow shooters to fire semiautomatic rifles continuously with one pull of the trigger. At his direction, the Justice Department later banned bump stocks in the United States, despite objections from gun lobbies.
Firearms sales rose 12.6% year over year in February 2018 following the Marjory Stoneman Douglas High School massacre in Parkland, Florida, according to Bloomberg.
“It’s a longstanding pattern,” said David Kopel, an adjunct scholar at the Cato Institute, a libertarian think tank.
The firearms industry wants to hear the results of the investigation into the Boulder mass shooting before proposing solutions, said Mark Oliva, spokesperson for the National Shooting Sports Foundation, a gun industry trade group.
Oliva says gun manufacturers already have worked with government officials on a number of measures meant to prevent guns from getting into the wrong hands. He said the NSSF helped convince lawmakers in 16 states to include mental health records that would disqualify a customer from purchasing a firearm as part of each state’s mandatory gun background checks.
However, gun control advocates argue that mental illness is not a leading factor in gun violence, and the government must act to implement stricter laws that prevent shootings.
“We want the investigative process to go forward as it needs to,” Oliva told CNN Business. “We urge Congress and the White House to do the same.”
A giant boxship ran aground in the Suez Canal on Tuesday, blocking all vessel traffic and creating a backlog of ships on one of the world’s busiest trade routes.
The Ever Given, a 400-meter (1,312 foot) container ship, was stuck in the canal sideways, with its bow wedged in one bank and its stern nearly touching the other, according to ship operators and images posted on social media.
The ship, operated by Taiwan-based Evergreen Group, is one of the biggest ocean vessels. It can move more than 20,000 containers and is taller than the Empire State Building if turned upright.
“There are at least 100 ships waiting to transit between the Red Sea and the Mediterranean,” said a London broker. “Tug boats are trying to refloat it, but it’s not going to be easy.”
The Suez Canal Authority, which operates the canal, wasn’t immediately available for comment. An Evergreen spokesperson said the ship was probably hit by strong winds “causing the hull to deviate from the channel and run aground.”
