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Wall St stumbles after weak data, hawkish Fed comments

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  • Fed’s Bullard, Mester back rate increases
  • U.S. retail sales drop in December
  • Indexes down: Dow 1.28%, S&P 1.07%, Nasdaq 0.78%

Jan 18 (Reuters) – Wall Street’s main indexes fell on Wednesday after weak economic data and hawkish comments from Federal Reserve officials sparked worries that the central bank may not pause interest rate hikes any time soon.

Before the market opened, U.S. economic data showed retail sales and producer prices declined more than expected in December. Also production at U.S. factories fell more than expected in December and output in the prior month was weaker than previously thought.

With Wall Street’s major averages showing gains so far for 2023, Sam Stovall, chief investment strategist at CFRA research, said some investors saw the week data as an opportunity to take profits while others worried about the prospects for a recession.

“The market was overbought. Today’s economic data served as a trigger to initiate a profit taking spell and the groups with most profits to take have been the ones that have done best last year,” said Stovall.

By 2:14PM ET, the Dow Jones Industrial Average (.DJI) fell 434.27 points, or 1.28%, to 33,476.58, the S&P 500 (.SPX) lost 42.57 points, or 1.07%, to 3,948.4 and the Nasdaq Composite (.IXIC) dropped 87.02 points, or 0.78%, to 11,008.10.

The weakest sectors on the day are the defensive consumer staples (.SPLRCD), down more than 2%, and utilities (.SPLRCU), which was last down 1.8%.

The benchmark S&P and the blue-chip Dow were both on track for their second straight day of losses, while the Nasdaq, if it ends lower, would snap a seven-day winning streak.

U.S. stocks had started 2023 on a strong footing, with the S&P having closed up almost 4% year-to-date on Tuesday, on hopes that a moderation in inflationary pressures could give the Fed cover to dial down the size of its interest rate hikes.

Roughly halfway through January, the S&P was up 2.7% for the month so far while the Nasdaq was up more than 5% and the Dow, the best performer of the three for 2022, was up 0.9%.

Earlier, St. Louis Fed President James Bullard and Cleveland Fed President Loretta Mester stressed on the need to raise rates beyond 5% to bring inflation to heel.

The Fed commentary also highlighted the disparity between the U.S. central bank’s estimate of its terminal rate and market expectations, which were of the rate peaking at 4.88% by June. Traders are now betting on a 25-basis point rate hike in February.

“This market is very hopeful that we’re going to get a soft landing and every time you have hawkish comments from the Fed, it feels you’re not going to get that,” Dennis Dick, trader at Triple D Trading.

Investors are also focused on the fourth-quarter earnings season as a window into how corporate America is doing against the backdrop of higher interest rates.

Analysts now expect year-over-year earnings from S&P 500 companies to decline 2.6% for the quarter, according to Refinitiv data, compared with a 1.6% decline in the beginning of the year.

IBM Corp (IBM.N) was down 2.6% after Morgan Stanley downgraded the company’s shares to “equal weight” from “overweight”.

Early gainers Microsoft Corp (MSFT.O) and Tesla Inc (TSLA.O) erased gains by late afternoon trading with Microsoft down 1.2% and Tesla off 2.7%.

Moderna Inc (MRNA.O) rose 3.6% after reporting data which demonstrated the effectiveness of its respiratory syncytial virus (RSV) vaccine.

PNC Financial Services Group Inc (PNC.N) was down 5.4% after the company missed estimates for fourth-quarter profit.

Declining issues outnumbered advancing ones on the NYSE by a 1.38-to-1 ratio; on Nasdaq, a 1.66-to-1 ratio favored decliners.

The S&P 500 posted 9 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 71 new highs and 14 new lows.

Reporting by Sinéad Carew in New York, Shreyashi Sanyal and Amruta Khandekar in Bengaluru; Additional reporting by Shubham Batra; Editing by Shounak Dasgupta and David Gregorio

Our Standards: The Thomson Reuters Trust Principles.

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Business

Exclusive: FTX’s former top lawyer aided U.S. authorities in Bankman-Fried case

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Jan 5 (Reuters) – FTX’s former top lawyer Daniel Friedberg has cooperated with U.S. prosecutors as they investigate the crypto firm’s collapse, a source familiar with the matter said, adding pressure on founder Sam Bankman-Fried who was arrested on criminal fraud charges last month.

Friedberg gave details about FTX in a Nov. 22 meeting with two dozen investigators, the person said. The meeting, held at the U.S. Attorney for the Southern District of New York’s office included officials from the Justice Department, Federal Bureau of Investigation, and the U.S. Securities and Exchange Commission, the source said. Emails between attendees scheduling the meeting with those agencies were seen by Reuters.

At the meeting, he told prosecutors what he knew of Bankman-Fried’s use of customer funds to finance his business empire, the source said. Friedberg recounted conversations he had with other top executives on the subject and provided details of how Bankman-Fried’s hedge fund Alameda Research functioned, the source said.

Friedberg’s cooperation has not been previously reported. He has not been charged and has not been told he is under criminal investigation, the source said. Instead, he expects to be called as a government witness in Bankman-Fried’s October trial, the person said.

Friedberg’s lawyer, Telemachus Kasulis, the FBI and FTX did not respond to requests for comment on his cooperation. The SEC, the Department of Justice and Bankman-Fried’s spokesman declined to comment.

Bankman-Fried is accused of diverting billions of dollars in FTX client funds to Alameda to bankroll venture investments, luxury real estate purchases, and political donations. On Tuesday, he pleaded not guilty in Manhattan federal court.

Manhattan U.S. Attorney Damian Williams, who is leading the criminal case against now bankrupt FTX, said last month: “If you participated in misconduct at FTX or Alameda, now is the time to get ahead of it.”

Two of Bankman-Fried’s closest associates, Caroline Ellison, Alameda’s former chief executive, and Gary Wang, FTX’s former chief technology officer, pleaded guilty to fraud and agreed to cooperate. A lawyer for Ellison didn’t respond to a request for comment. Wang’s lawyer declined to comment.

MEETING WITH PROSECUTORS

FTX filed for bankruptcy protection on Nov. 11. A few days later, on Nov. 14, Friedberg received a call from two FBI agents based in New York. He told them he was willing to share information but needed to ask FTX to waive his attorney-client privilege, according to a person familiar with the matter and emails viewed by Reuters.

Friedberg wrote to FTX the next day asking the company to waive his privilege so he could cooperate with prosecutors, according to the email seen by Reuters. FTX did not do so, but agreed with Friedberg on the points he could disclose to investigators, the person said.

Friedberg then wrote back to the two FBI agents, telling them in an email reviewed by Reuters: “I want to cooperate in all respects.”

The U.S. Attorney’s Office set up a meeting where Friedberg signed so-called proffer letters prepared for him by the SEC and other agencies, according to the source and an email exchanged by participants. Proffer letters typically describe a potential agreement between authorities and individuals who are witnesses or subjects of an investigation.

“THROUGH THICK AND THIN”

Prior to his work advising FTX, Friedberg advised a mix of banking, fintech, and online gaming companies.

One of his previous employers, a Canadian online gaming firm named Excapsa Software, where he was general counsel, also drew controversy due to a cheating scandal involving a poker site it operated called Ultimate Bet. A Canadian gaming commission in 2008 fined Ultimate Bet $1.5 million for failing to enforce measures to prevent fraudulent activities. Excapsa has since dissolved.

According to an audio recording available on the website PokerNews, Friedberg and some other Ultimate Bet associates privately discussed that year how to handle the scandal and minimize the amount of refunds owed to players. Friedberg previously told NBC News that the audio was illegally recorded but NBC’s article did not say that Friedberg challenged its authenticity.

Friedberg first represented Bankman-Fried in 2017 as outside counsel while at U.S. law firm Fenwick & West, where he chaired its payment systems group, the source familiar with the matter said. At the time, the source said Friedberg advised Bankman-Fried on running Alameda, which he founded that year.

In 2020, when Bankman-Fried launched a separate exchange for U.S. customers called FTX.US, Friedberg moved in-house as FTX’s chief regulatory officer.

In a now-deleted blog post published that year on FTX’s website, Bankman-Fried wrote that Friedberg was FTX’s legal advisor “from the very beginning,” noting he had been “with us through thick and thin.”

Friedberg resigned from his position on Nov. 8, a day after Bankman-Fried disclosed to top executives that FTX was almost out of money, according to the source and three other people briefed on the talks, along with text messages his legal team exchanged at the time.

Additional reporting by Hannah Lang; editing by Megan Davies and Anna Driver

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Business

Microsoft to buy 4% stake in London Stock Exchange

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Dec 12 (Reuters) – Microsoft (MSFT.O) is to take a 4% equity stake in London Stock Exchange Group (LSEG.L) as part of a 10-year commercial deal to migrate the exchange operator’s data platform into the cloud, the British company said on Monday.

It is the latest sign of deepening ties between financial services providers and a handful of big global cloud companies such as Microsoft, Google (GOOGL.O), Amazon (AMZN.O) and IBM (IBM.N), which have prompted regulators to scrutinise the ties more closely.

Microsoft has longstanding links with LSEG, but the exchange group’s Chief Executive David Schwimmer said that about a year ago they began talks on closer ties.

“It’s a long term partnership. In terms of the products we will be building together, I would expect our customers to start to see the benefits of that 18 to 24 months out and we will continue building from there,” Schwimmer told Reuters.

Regulators have expressed concern about the over-reliance of financial firms on too few cloud providers, given the disruption this could cause across the sector if a provider went down.

The European Union has just approved a law introducing safeguards on cloud providers in financial services, with Britain set to follow suit.

“You should assume we do not like to surprise our regulators,” Schwimmer said, when asked if LSEG has ensured that regulators were on board.

LSEG said the link with Microsoft was a partnership to reap the benefits of “consumption-based pricing”, and not a traditional cloud deal.

“We will continue to maintain our multi-cloud strategy and working with other cloud providers,” Schwimmer said.

The deal was not about savings by outsourcing activities to the cloud, but about meaningful incremental revenue growth as new products come on stream over time.

“This feels like a key milestone in LSEG’s journey towards being information solutions-centric, even if ‘meaningful’ revenue growth specifics are lacking,” analysts at Jefferies said.

As part of the deal, LSEG has made a contractual commitment for minimum cloud-related spend with Microsoft of $2.8 billion over the term of the partnership.

Microsoft said the basis of the partnership will be the digital transformation of LSEG’s technology infrastructure and Refinitiv platforms on to the Microsoft Cloud.

“The initial focus will be on delivering interoperability between LSEG Workspace and Microsoft Teams, Excel and PowerPoint with other Microsoft applications and a new version of LSEG’s Workspace,” the U.S. company said.

LSEG shares were up 4% in early trade.

LSEG bought Refinitiv for $27 billion from a Blackstone and Thomson Reuters’ consortium, which turned the exchange into the second largest financial data company after Bloomberg LP.

LSEG has made “good progress” on its programme for the delivery of its cloud-based data platform since the completion of its Refinitiv acquisition in January 2021, it said in a statement.

Microsoft will buy LSEG shares from the Blackstone (BX.N)/Thomson Reuters (TRI.TO), Consortium, the exchange operator said.

Thomson Reuters, which owns Reuters News, has a minority shareholding in LSEG following the Refinitiv deal.

Microsoft’s purchase is expected to complete in the first quarter of 2023.

Reporting by Yadarisa Shabong in Bengaluru; Editing by Nivedita Bhattacharjee, Jane Merriman and Louise Heavens

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World

France, Germany, Spain agree on moving on with FCAS warplane development – Berlin

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BERLIN/PARIS, Nov 18 (Reuters) – France, Germany and Spain have reached agreement on starting the next phase of development of a new fighter jet dubbed FCAS, Europe’s largest defence project at an estimated cost of more than 100 billion euros($103.4 billion), the German government said on Friday.

The Defence Ministry said in a statement that an industrial agreement was achieved after intense negotiations, confirming an earlier Reuters story saying the three countries and their respective industries had struck a deal.

The ministry said it was agreed at the highest government level that a cooperative approach on an equal footing would be pursued in the project, which is under overall French responsibility.

The Spanish Defence Ministry said Madrid would spend 2.5 billion euros ($2.58 billion) on the project, of which 525 million euros ($542 million) would be paid in 2023. The ministry said that the cabinet agreed to this expenditure but did not give other details.

“The political agreement on FCAS is a great step and – especially in these times – an important sign of the excellent Franco-German-Spanish cooperation,” German Defence Minister Christine Lambrecht said.

“It strengthens Europe’s military capabilities and secures important know-how not only for our, but also for the European industry.”

Previously, sources had said that the next development phase for the Future Combat Air System (FCAS) was expected to cost about 3.5 billion euros, to be shared equally by the three countries.

France’s Dassault (AM.PA), Airbus (AIR.PA) and Indra (IDR.MC) – the latter two representing Germany and Spain, respectively – are involved in the scheme to start replacing French Rafale and German and Spanish Eurofighters from 2040.

“Now, a number of formal steps in the respective countries have to be taken in order to allow a speedy contract signature which we will have to adhere to,” Airbus said in e-mailed comments.

French President Emmanuel Macron and then German Chancellor Angela Merkel first announced plans in July 2017 for FCAS, which will include a fighter jet and a range of associated weapons, including drones.

Lately, the project – originally meant to unify Europeans after the migration crisis and Britain’s decision to leave the European Union – has been a source of tension between the two countries.

Last month, Macron cancelled a joint Franco-German ministerial meeting over disagreements with Berlin on a wide range of issues including defence and energy projects.

Both sides had been struggling for more than a year to agree the next stage of FCAS’s development, although the French and German government broadly agreed on the project.

Some sources saw the blame lying with Dassault, as the company had refused to budge in a long-running row over intellectual property rights.

Other sources blamed Airbus for pushing for a bigger workshare of the Dassault-led project, insisting it should be given “equal footing” with the French company.

($1 = 0.9675 euros)

Writing by Sabine Siebold; Editing by Kirsti Knolle, Christoph Steitz, Louise Heavens and Emelia Sithole-Matarise

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Business

Buffett’s Berkshire discloses $4.1 bln TSMC stake

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Nov 14 (Reuters) – Berkshire Hathaway Inc (BRKa.N) said it bought more than $4.1 billion of stock in Taiwan Semiconductor Manufacturing (2330.TW), , a rare significant foray into the technology sector by billionaire Warren Buffett’s conglomerate.

The news sent shares in TSMC up more than 6% in Taiwan on Tuesday, as it boosted investor sentiment for the world’s largest contract chipmaker, which saw its shares hit a two-year low last month due to a sharp slowdown in global chip demand.

In a Monday regulatory filing describing its U.S.-listed equity investments as of Sept. 30, Berkshire said it owned about 60.1 million American depositary shares of TSMC.

Berkshire also disclosed new stakes of $297 million in building materials company Louisiana-Pacific Corp (LPX.N) and $13 million in Jefferies Financial Group Inc (JEF.N). It exited an investment in Store Capital Corp (STOR.N), a real estate company that agreed in September to be taken private.

The filing did not specify whether Buffett or his portfolio managers Todd Combs and Ted Weschler made specific purchases and sales. Investors often try to piggy back on what Berkshire buys. Larger investments are normally Buffett’s.

While Berkshire does not normally make big technology bets, it often prefers companies it perceives to have competitive advantages, often through their size.

TSMC, which makes chips for the likes of Apple Inc (AAPL.O), Qulacomm (QCOM.O) and Nvidia Corp (NVDA.O), posted an 80% jump in quarterly profit last month, but struck a more cautious note than usual on upcoming demand.

“I suspect Berkshire has a belief that the world cannot do without the products manufactured by Taiwan Semi,” said Tom Russo, a partner at Gardner, Russo & Quinn in Lancaster, Pennsylvania, which owns Berkshire shares.

“Only a small number of companies that can amass the capital to deliver semiconductors, which are increasingly central to people’s lives,” he added.

Berkshire has had mixed success in technology.

Its more than six-year wager during the last decade in IBM Corp (IBM.N) did not pan out, but Berkshire is sitting on huge unrealized gains on its $126.5 billion stake in Apple, which Buffett views more as a consumer products company.

Apple is by far the largest investment in Berkshire’s $306.2 billion equity portfolio.

Berkshire disclosed the TSMC stake about 2-1/2 months after it began reducing a decade-old, multi-billion dollar stake in BYD Co (002594.SZ), China’s largest electric car company.

In the third quarter, Berkshire added to its stakes in Chevron Corp (CVX.N), Occidental Petroleum Corp (OXY.N), Celanese Corp (CE.N), Paramount Global (PARA.O) and RH (RH.N).

It also sold shares of Activision Blizzard Inc (ATVI.O), Bank of New York Mellon Corp (BK.N), General Motors Co (GM.N), Kroger Co (KR.N) and US Bancorp (USB.N).

Buffett, 92, has run Berkshire since 1965. The Omaha, Nebraska-based company also owns dozens of businesses such as the BNSF railroad, the Geico auto insurer, several energy and industrial companies, Fruit of the Loom and Dairy Queen.

Reporting by Jonathan Stempel in New York; Editing by David Gregorio and Bradley Perrett

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Business

Wall Street ends lower as Fed worries outweigh earnings

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  • IBM up as it sees higher full-year sales
  • Tesla expects to miss vehicle delivery target this year
  • AT&T raises annual profit forecast
  • Dow down 0.3%, S&P 500 down 0.80%, Nasdaq down 0.61%

NEW YORK, Oct 20 (Reuters) – U.S. stocks closed lower on Thursday as data on the labor market and comments from a U.S. Federal Reserve official reinforced expectations the central bank will be aggressive in hiking interest rates outweighed a flurry of solid corporate earnings.

Stocks initially rose early in the session, boosted by gains in names such as IBM (IBM.N), up 4.73% after the IT services company beat quarterly earnings estimates on Wednesday and said it expects to exceed full-year revenue growth targets. AT&T Inc (T.N) surged 7.72% upon raising its annual profit forecast.

But stocks were unable to hold their gains as strong weekly jobless claims and comments from Federal Reserve Bank of Philadelphia President Patrick Harker bolstered concerns about the Fed hiking rates and potentially tilting the economy into a recession.

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Harker said the Fed is not done raising its short-term rate target as high inflation persists, helping to push the yield on the 10-year U.S. Treasury note to its highest level since June 2008 at 4.239%.

“It’s interest rates that are driving equity volatility, that is the way we have been looking at things all year, that is kind of the precursor of seeing things calm down in the equity space and feeling better about adding risk there is seeing volatility decline in interest rates,” said Zachary Hill, head of portfolio management at Horizon Investments in Charlotte, North Carolina.

“I’m not sure we are going to be able to see that pause that a few Fed members have been pointing to and certainly a few market participants have been kind of latching on to.”

The Dow Jones Industrial Average (.DJI) fell 90.22 points, or 0.3%, to 30,333.59, the S&P 500 (.SPX) lost 29.38 points, or 0.80%, to 3,665.78 and the Nasdaq Composite (.IXIC) dropped 65.66 points, or 0.61%, to 10,614.84.

The New York Stock Exchange building is seen from Broad Street in Lower Manhattan in New York, January 20, 2016. REUTERS/Mike Segar

Better-than-expected results thus far has pushed earnings growth expectations for third-quarter for S&P 500 companies to 3.1% from a 2.8% increase earlier in the week, but still well below the 11.1% increase that was forecast at the start of July.

Tesla Inc (TSLA.O) slumped 6.65% as the electric-vehicle maker flagged persistent logistics challenges, with fourth-quarter deliveries growing by less than the aimed 50%.

Stocks have been under pressure this year as concerns about the impact of the Fed’s aggressive path of interest rate hikes on corporate earnings and the overall economy have mounted as the central bank tries to quell stubbornly high inflation.

Other data showed sales of existing homes fell for an eight straight month, while another reading showed factory activity in the Federal Reserve Bank of Philadelphia’s district contracted again in October.

The U.S. central bank is widely expected to announce a fourth straight 75 basis-point hike at its November meeting, with an outside chance of a full percentage point increase.

Volume on U.S. exchanges was 11.37 billion shares, compared with the 11.62 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 2.12-to-1 ratio; on Nasdaq, a 1.34-to-1 ratio favored decliners.

The S&P 500 posted 3 new 52-week highs and 28 new lows; the Nasdaq Composite recorded 53 new highs and 239 new lows.

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Reporting by Chuck Mikolajczak; Editing by Aurora Ellis

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Business

AppLovin offers to buy video game software maker Unity in $17.5 bln deal

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People play “Pokemon GO” on the Pokequan GoBoat Adventure Cruise in the Occoquan River in the small town of Occoquan, Virginia, U.S. August 14, 2016. REUTERS/Sait Serkan Gurbuz

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Aug 9 (Reuters) – Gaming software company AppLovin Corp (APP.O) on Tuesday made an offer to buy peer Unity Software Inc (U.N) in a $17.54 billion all-stock deal, looking to tap into growing demand for three-dimensional gaming.

Both companies make software used to design video games. Game-making software has also been expanding to new technologies such as the so-called metaverse, or immersive virtual worlds.

Unity’s software has been used to build some of the most-played games such as “Call of Duty: Mobile,” and “Pokemon Go”, while AppLovin provides helps developers to grow and monetize their apps.

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The enterprise value of the deal is $20 billion. AppLovin will offer $58.85 for each Unity share, which represents a premium of 18% to Unity’s Monday closing price.

Shares of Unity rose 7%, while those of AppLovin fell 14% before the opening bell.

Under the proposed deal, Unity will own 55% of the combined company’s outstanding shares, representing about 49% of the voting rights.

AppLovin Chief Executive Officer Adam Foroughi said the combined company will have the potential to generate an adjusted operating profit of over $3 billion by the end of 2024.

“Unity is one of the world’s leading platforms for helping creators turn their inspirations into real-time 3D content,” Foroughi said.

Last week, Reuters reported that Unity was in talks to spinoff its China unit to expand in one of the world’s biggest markets for video games.

Palo Alto, California-based AppLovin, backed by KKR and Co (KKR.N) went public last year, cashing in on the surge in demand for video games from people staying at home due to the COVID-19 pandemic.

AppLovin’s offer, however, comes as game developers and console makers warn of a slowdown in the sector as decades-high inflation and easing of cOVID-19 restrictions lead gamers to pick outdoor activities.

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Reporting by Eva Mathews and Nivedita Balu in Bengaluru; Editing by Saumyadeb Chakrabarty

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World

India puts ‘new reality’ on display with Davos street show

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DAVOS, Switzerland, May 25 (Reuters) – Bright colours and bold logos proudly signal where India has set up base on the main street in Davos this year, as the country trumpets its pro-business and foreign investment drive.

Inside a pavilion on the Swiss Alpine resort’s Promenade street beneath an “India @ Davos 2022” logo, the federal government served up treats including ‘masala chai’ tea, ‘samosa’ snacks and other spicy delicacies.

Clustered around it are six Indian states with their own lounges, housed in what are usually high street shops.

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“It’s an Indian street, it should be called ‘Little India’. It shows the country is open for investments,” said Samir Saran of India’s Observer Research Foundation.

Indian Commerce Minister Piyush Goyal told Reuters that Prime Minister Narendra Modi had suggested bringing states together to showcase unity at the gathering of business and political leaders at the World Economic Forum.

“Investors love this kind of a messaging,” Goyal said.

While India has long had a presence at the World Economic Forum, several officials and attendees from Asia’s third-largest economy said it was not previously so prominent.

At the government’s base, food was being prepared by a team of 15 chefs who were flown in from India, along with 450 kilograms of vegetables and local spices, head chef Guru Nathan told Reuters, as people enjoyed a fragrant morning buffet.

“We were asked to keep the spice moderate so that everyone can enjoy (the food),” Nathan said.

Only a few steps down the road, Indian tech giants Infosys (INFY.NS), Wipro (WIPR.NS) and HCL Technologies (HCLT.NS) have set up their bases close to those of Alphabet’s (GOOGL.O) Google, Meta (FB.O) and Intel (INTC.O).

One state government official put the number of Indian officials attending Davos at more than 100, with scores of company executives and a handful of startups also present. Goyal estimated overall there would be 200 Indian participants.

“We have record numbers from India,” Sriram Gutta, head of India agenda at the WEF, said.

‘NEW REALITY’

Federal ministers have talked about India’s economic boom and the opportunities it offers at Davos.

Although Modi’s government has often faced criticism from foreign companies for announcing policies which they say are protectionist in nature and favour domestic companies, India recently reported its highest ever foreign direct investment inflow, which hit $83.57 billion in 2021-22.

After engaging regularly with Indian states on subjects such as agriculture technology, drones and electric vehicles, the WEF has gradually increased the number of invitations to them, Gutta said, adding that they “will continue to gain prominence”.

Even though they are run by different political parties, the states were seeking to project a united image and showcase their respective offerings for businesses, Deepak Bagla, CEO of federal investment promotion arm Invest India, told Reuters.

The southern state of Andhra Pradesh signed investment pacts worth a total of $16 billion for investment in renewables at Davos, while one official said Karnataka has held meetings with prospective investors. read more

“What this street really shows you is the new reality of India,” Bagla said.

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Reporting by Aditya Kalra; Editing by Alexander Smith

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Business

Wall St ends lower as investors await further earnings cues

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  • Bank of America boosts S&P 500
  • Twitter gains after adopting ‘poison pill’
  • Didi to meet on U.S. delisting plans, shares plunge
  • Indexes down: Dow 0.11%, S&P 0.02%, Nasdaq 0.14%

April 18 (Reuters) – U.S. stocks closed lower on Monday after a session which saw all three benchmarks slip between positive and negative territory, as investors contrasted Bank of America’s positive earnings with surging bond yields ahead of further earnings cues this week.

Market participants are bracing for a barrage of earnings that will help them assess the impact of the Ukraine war and a spike in inflation on company financials. Netflix (NFLX.O), Tesla (TSLA.O), Johnson & Johnson (JNJ.N) and International Business Machines (IBM.N) are all to report this week.

Trading volumes were thin after the Easter break: 10.35 billion shares changed hands, compared with the 11.79 billion average for the full session over the last 20 trading days.

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With European markets also remaining shut on Monday, this listless trading contributed to the topsy-turvy session.

“The market is looking for some direction. Do we get it from earnings – maybe. But the overarching factors continue to be what does China look like with its zero-COVID policy, and what does the Fed look like going forward in terms of interest rates and inflation,” said Jack Janasiewicz, portfolio manager and lead portfolio strategist at Natixis Investment Managers.

“It’s going to be some time before either one gives us any clear direction. With that backdrop, I’m not shocked if we just continue to trade in a range.”

Bank of America rounded out earnings season for the big Wall Street banks, reporting strong growth in its consumer lending business, although its investment banking unit took a hit from a slowdown in deal making. read more

Its share price rose 3.4%, while the broader S&P 500 banks index (.SPXBK) also gained 1.7%.

Apple Inc (AAPL.O) slipped 0.1% as the benchmark 10-year Treasury yield climbed to 2.86%, after hitting 2.884% earlier on Monday, the highest since Dec. 2018.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 30, 2022. REUTERS/Brendan McDermid/File Photo

Shares of market-leading technology and growth companies have come under pressure as expectations of a string of interest rate hikes threaten to erode their future earnings.

Tesla, however, rose 2% as it prepares to reopen its Shanghai plant following a near three-week COVID shutdown. read more

Five of the 11 major S&P sectors were higher, led by the energy index (.SPNY) which advanced 1.5%. Crude prices gained and Brent topped $114 a barrel at one point on outages in Libya deepening concerns over tight global supply.

Among the best performers was Marathon Petroleum Corp (MPC.N), which gained 3.3% to hit a second lifetime high in three sessions. Valero Energy Corp (VLO.N) and Phillips 66 (PSX.N) both advanced 5.2%.

The Dow Jones Industrial Average (.DJI) fell 39.54 points, or 0.11%, to 34,411.69, the S&P 500 (.SPX) lost 0.9 points, or 0.02%, to 4,391.69 and the Nasdaq Composite (.IXIC) dropped 18.72 points, or 0.14%, to 13,332.36.

Charles Schwab Corp (SCHW.N) fell 9.4%, its biggest one-day drop since March 2020, after the financial services company missed quarterly profit estimates.

Twitter (TWTR.N) rose 7.5% as the micro blogging site adopted “poison pill” on Friday to restrict Tesla CEO Elon Musk from raising his stake to beyond 15% for a one-year period.

Didi Global Inc (DIDI.N) slumped 18.3% after the Chinese ride hailing company said it will hold an extraordinary general meeting on May 23 to vote on its delisting plans in the United States. read more

The S&P 500 posted 27 new 52-week highs and 24 new lows; the Nasdaq Composite recorded 59 new highs and 397 new lows.

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Reporting by Bansari Mayur Kamdar, Sruthi Shankar and Amal S in Bengaluru and David French in New York; Editing by Arun Koyyur, Anil D’Silva and Grant McCool

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World

Opponents of French far-right protest as election campaign enters final week

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PARIS, April 16 (Reuters) – Thousands of anti-far right protesters marched across France on Saturday as opponents of presidential candidate Marine Le Pen seek to form a united front to prevent her from winning an election runoff against incumbent Emmanuel Macron on April 24.

Police have warned of possible incidents as demonstrators convene in some 30 cities.

Macron, a pro-European Union centrist, won the presidency in 2017 after easily beating Le Pen when voters rallied behind him in the runoff to keep her far-right party out of power.

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This year, the first round of voting last Sunday set up the same battle, but Macron is facing a much tougher challenge.

In central Paris, thousands of people gathered chanting anti-far right slogans and warning of democratic upheaval if Le Pen were to win. One banner read: “Against the far-right. For justice and equality, not Le Pen at the Elysee,” referring to the French president’s official residence.

“If the far-right is in power we will see a major collapse of the democratic, anti-racism and progressive camps,” Dominique Sopo, president of SOS Racism, which along with dozens of rights groups, unions and associations called for the protests, told Reuters.

“People need to realise that despite their anger towards Emmanuel Macron and his policies, there is no equivalence between a liberal, conservative candidate and a far-right candidate.”

Macron, who will hold a rally in Marseille later in the day as he tries to convince left-wing voters to pick him on April 24, is slightly ahead in opinion polls.

But prior to the first round on April 10 Le Pen successfully tapped into anger over the cost of living and a perception that Macron is disconnected from everyday hardships. That saw her finish with 23.1% of votes compared to 27.85% for Macron.

However, she has appeared more rattled this week as the focus has turned to her manifesto and opinion polls have shown Macron extend his lead. An IPSOS-Sopra-Steria poll on Friday showed the president winning the runoff with 56% of votes.

He has won backing from former presidents Nicolas Sarkozy and Francois Hollande. Hundreds of celebrities and sporting figures have also endorsed him to block Le Pen coming to power.

DEEPLY UNDEMOCRATIC PROTESTS

Le Pen, whose stance is anti-immigration and eurosceptic, has sought in recent years to soften her image and that of her National Rally party. Opponents, including Macron, have said her programme is full of lies and false promises – an accusation Le Pen has rejected.

Speaking to reporters on a campaign stop in southern France, Le Pen dismissed the planned protests as undemocratic.

“The establishment is worried,” she said. “That people are protesting against election results is deeply undemocratic. I say to all these people just go and vote. It’s as simple as that.”

With the electorate fragmented and undecided, the election will likely be won by the candidate who can reach beyond his or her camp to convince voters that the other option would be far worse.

For decades, a “republican front” of voters of all stripes rallying behind a mainstream candidate has helped to keep the far right out of power.

But Macron, whose sometimes abrasive style and policies that veered to the right have upset many voters, can no longer automatically count on that backing.

Highlighting how, for some voters, picking Macron is no easy decision, one banner read in Paris: “Neither Le Pen, neither Macron.”

Climate change activists from Extinction Rebellion had earlier forced the closure of a main square and avenue in the capital, protesting the environmental programmes of both candidates.

“This election leaves us no choice between a far-right candidate with repugnant ideas … and a candidate who during five years cast the ecology issue aside and lied,” Lou, 26, a history teacher, who joined the Extinction Rebellion movement two years ago, told Reuters.

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Additional reporting by Marco Trujillo
Editing by Frances Kerry, Ros Russell and Clelia Oziel

Our Standards: The Thomson Reuters Trust Principles.

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