2024-12-11 21:00
Dec 11 (Reuters) - Alphabet (GOOGL.O) , opens new tab led a Big Tech rally on Wednesday, with its stock hitting a record high after U.S. President-elect Donald Trump picked Federal Trade Commissioner Andrew Ferguson to lead the consumer protection and antitrust agency. Trump tapped Ferguson on Tuesday to replace Lina Khan, whose term as FTC chair has expired. The agency became a political flashpoint under Khan, who promoted antitrust enforcement as a check on corporate power. Several Big Tech firms such as Google-parent Alphabet, Microsoft (MSFT.O) , opens new tab and Apple (AAPL.O) , opens new tab faced heightened regulatory pressure from the FTC during her tenure. Ferguson was a "known dissenter" under Khan "and many people feel under his leadership the antitrust case against Alphabet will come to an end", said Jay Woods, chief global strategist at Freedom Capital Markets. Trump and his team have been broadly critical of Big Tech companies, although some of his most prominent backers were tech executives, and it is unclear how they will approach regulatory and M&A policy for that sector. Alphabet's shares rose about 5.5% to hit a record high of $195.45. Tesla (TSLA.O) , opens new tab jumped 4.6%, also to a record high, extending its rally since the Nov. 5 presidential election on bets the EV-maker will benefit from CEO Elon Musk's close relationship with Trump. Other tech shares also rallied. Microsoft gained 1.2% and Amazon.com (AMZN.O) , opens new tab and Meta Platforms (META.O) , opens new tab added 2% each. The latest inflation report raised expectations of an interest-rate cut by the U.S. Federal Reserve later this month, lifting technology stocks. Shares of Alphabet have gained over 10% in the last two days following announcements from the company about its AI agents and quantum-chip breakthrough. Google released the second generation of its Gemini artificial-intelligence model earlier on Wednesday and teased a lineup of new ways to use AI beyond chatbots, including through a pair of eyeglasses. It unveiled a new-generation chip on Monday, which it said helped overcome a key challenge in quantum computing. "What we're seeing here is Google positioning itself at the bleeding edge of a transformative technology," said Michael Ashley Schulman, chief investment officer at Running Point Capital. "While Google sometimes has been viewed as 'behind' in AI, the recent quantum breakthrough shows us that the company knows how to construct processors," said Jamie Meyers, senior analyst at Laffer Tengler Investments. Sign up here. https://www.reuters.com/technology/google-parent-alphabet-hits-record-high-after-trump-taps-andrew-ferguson-ftc-2024-12-11/
2024-12-11 20:59
NEW YORK, Dec 10 (Reuters) - Chevron Corp (CVX.N) , opens new tab and Exxon Mobil (XOM.N) , opens new tab are considering entering the electricity business, with the U.S. oil majors working on deals to use natural gas and carbon capture to power the technology industry's AI data centers, executives with the companies said separately on Wednesday. Chevron has been in talks for more than a year about supplying natural gas-fired power, coupled with carbon capture technologies, to data centers, Jeff Gustavson, president of Chevron New Energies, said in an interview at the Reuters NEXT conference in New York. Gustavson's comments follow a similar announcement by Exxon Mobil (XOM.N) , opens new tab on Wednesday, which said it was working to provide data centers with low-carbon electricity by coupling carbon-capture with natural gas-fired power plants by the end of the decade. "We are working on this as well," Gustavson said, adding that Chevron's experience supplying natural gas around the world, and operating natural gas fired power equipment, positions the company well to meet booming electricity demand from data centers. "It fits many of our capabilities - natural gas, construction, operations, and being able to provide customers with a low-carbon pathway on power through CCUS (carbon capture, utilization and storage), geothermal, and maybe some other technologies," Gustavson said. The oil companies, which typically only produce electricity for their own operations, would enter the broader power market at a time of surging demand. Growth in technologies like generative artificial intelligence is expected to propel U.S. electricity demand to hit record highs in 2025 after remaining flat for roughly two decades. The urgent need for power has prompted the U.S. power industry to invest in new natural gas infrastructure and push for the delayed retirement of fossil-fuel power plants. That rush for electricity has also led some big technology companies to walk back climate-focused pledges, which previously required the use of only renewable sources like wind and solar for their energy-intensive AI data centers. To view the live broadcast of the World Stage go to the Reuters NEXT news page: https://www.reuters.com/world/reuters-next/ Sign up here. https://www.reuters.com/business/energy/chevron-working-supply-power-data-centers-executive-says-2024-12-11/
2024-12-11 20:39
DETROIT, Dec 11 (Reuters) - General Motors (GM.N) , opens new tab needed to exit its Cruise robotaxi business, most Wall Street analysts agreed on Wednesday, but the automaker's decision to do so was still a disappointing end for an operation that GM had touted as a potential $50 billion revenue generator by 2030. The largest U.S. automaker on Tuesday pulled the plug on Cruise after evaluating the continued investments needed in a competitive space, executives said, adding they intend to fold some of Cruise's talent into GM to continue development of driver assistance systems. "We consider the news a step in the right direction for GM, as we think investors were losing patience with its hefty spending (~$10B) related to robotaxi development with very little to show for its investment," Garrett Nelson, analyst at CFRA Research wrote. GM shares jumped 3% after-hours on Tuesday immediately after the announcement, but gave back those gains during Wednesday's regular session and were down about 1% in late afternoon. Nelson said the announcement was "a black eye for the credibility of GM management that, as recently as last year, told investors the Cruise business could generate $50 billion in annual revenue by 2030." For the year to date, GM has far outpaced its competitors. Its stock is up 45% for 2024, while Ford's is down 14% and Stellantis is down 37%. GM CEO Mary Barra was already scheduled to speak with reporters Wednesday evening. She will likely face questions on cost-cutting moves the automaker is taking as it navigates turbulence in EV demand, changing technology and a new presidential administration. “This is the latest in the series of decisions that GM has announced which underscore our focus on having the right technology for the future of our company and the industry and reflects our commitment to execute with speed and efficiency," Barra told analysts Tuesday. GM recently scaled back plans for electric vehicles, sold a stake in one of its joint venture battery plants and recorded a $5 billion loss on its China business as it restructures. GM is now doubling down on its core business: making gasoline-powered pickup trucks and other large vehicles. Cruise's competitors - including Alphabet's (GOOGL.O) , opens new tab Waymo, Baidu (9888.HK) , opens new tab and Tesla(TSLA.O) , opens new tab - are well funded, and may have better technology, analysts said. Waymo, which is expanding its autonomous ride-hailing services, is still losing billions of dollars per year. Barclays noted Alphabet, which has over $100 billion in earnings annually, can absorb costs associated with Waymo's development. GM, however, is expected to record earnings of $14 billion to $15 billion for 2024. "It’s clear from Waymo that an AV robotaxi business is best owned by an entity with deep pockets," Barclays said. Sign up here. https://www.reuters.com/business/autos-transportation/wall-street-mostly-upbeat-gms-decision-pull-plug-cruise-2024-12-11/
2024-12-11 20:29
Canadian dollar gains 0.1% against the greenback Bank of Canada cuts benchmark rate by 50 basis points Price of US oil settles 2.5% higher 10-year yield climbs 7.9 basis points TORONTO, Dec 11 (Reuters) - The Canadian dollar rose against its U.S. counterpart and all other G10 currencies on Wednesday as the Bank of Canada cut interest rates by half a percentage point but shifted to more hawkish guidance on prospects for additional easing. The loonie was trading 0.1% higher at 1.4160 to the U.S. dollar, or 70.62 U.S. cents, after trading in a range of 1.4121 to 1.4193. On Tuesday, it touched a 4-1/2-year low at 1.4194. "The decision to cut by 50 bps (basis points) has largely been overshadowed by a hawkish shift in guidance from the BoC," said Nick Rees, senior FX market analyst at Monex Europe Ltd. The Canadian central bank slashed its key policy rate by 50 bps, as expected, to 3.25% and indicated further cuts would be more gradual, in a shift from previous messaging that continuous easing was needed to support growth. BoC Governor Tiff Macklem said for the first time that the possibility of new tariffs under U.S. President-elect Donald Trump on imports from Canada represented "a major new uncertainty." "We are inclined to think that tariffs will warrant substantial further policy easing in 2025, regardless of the bank's latest statements, which should ensure that this current bout of CAD strength is short-lived," Rees said. Money markets see a roughly 60% chance the BoC will cut its policy rate by 25 bps in January, with the market pricing in a 40% chance of a pause in cuts. The loonie was the only G10 currency to gain ground against the U.S. dollar (.DXY) , opens new tab as investors assessed U.S. inflation data. The price of oil , one of Canada's major exports, settled 2.5% higher at $70.29 a barrel. The Canadian 10-year yield was up 7.9 basis points at 3.098%, extending its rebound from a two-month low on Friday at 2.970%. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-rallies-central-banks-more-hawkish-guidance-2024-12-11/
2024-12-11 20:28
Dec 11 (Reuters) - Arbitration proceedings between Canadian miner Franco-Nevada and Panama over the Cobre Panama copper mine entered a new phase this week with the formation of a tribunal to hear the case, according to legal disclosures filed by the parties. Investors are awaiting Panama President Jose Raul Mulino's decision over the future of the mine, which was shut down last year due to public unrest. Cobre Panama is the flagship mine of Canadian miner First Quantum Minerals (FM.TO) , opens new tab, which is also seeking damages from Panama. Franco-Nevada (FNV.TO) , opens new tab had a streaming agreement with First Quantum to buy gold and copper from Cobre Panama in return for financing mine operations. Franco-Nevada is seeking $5 billion in damages from Panama under the Canada-Panama free-trade agreement. In 2023, Franco-Nevada took a $1-billion charge due to the mine's closure. First Quantum has sought damages of at least $20 billion and Orla Mining (OLA.TO) , opens new tab, which had its separate mining contract canceled last year, is claiming at least $400 million from Panama. The next stage is formal arbitration proceedings in which the parties present their arguments. Cobre Panama has become a flashpoint in the mining industry as its closure has removed 1% of global copper supply. Mulino has said his government will decide the mine's fate early next year, even as the arbitration cases proceed. Rating agency Moody's cut Panama's outlook to negative in November and pointed out potential credit risks due to the ongoing litigation. "Absent measures to address this risk, including reopening negotiations with the mine's operators, the government's credit profile could face a severe financial shock in case of an adverse ruling," Moody's said. Franco-Nevada did not respond to a request for comment. First Quantum declined to comment. Shares of Franco-Nevada were down 1.7% in Toronto and First Quantum dipped 0.5%. Sign up here. https://www.reuters.com/markets/commodities/arbitration-between-miner-franco-nevada-panama-moves-next-stage-2024-12-11/
2024-12-11 20:13
NEW YORK, Dec 11 (Reuters) - President-elect Donald Trump is expected to adopt pro-growth policies that ease U.S. banking and credit card regulations while spurring deals, industry executives said on a panel at the Reuters NEXT conference in New York on Wednesday. "I hope the new administration will use this as a point to do a reset," Barclays U.S. consumer bank CEO Denny Nealon said at Reuters NEXT. "There are some things, like the credit card competition act, that could destabilize the credit cards market and ultimately hurt the consumer," he said, referring to rules from the Biden administration. The new administration appears to be "more inclined towards deregulation," said Akita Somani, U.S Bancorp head of inclusive growth strategy. She expects new policies to "set up the industry for growth in terms of being more amenable to mergers and acquisitions and making that a real possibility," Somani said, referring to the broader industry instead of her company specifically. In the weeks since Trump's election victory, bankers have become more bullish on deals. Some predicted that friendly regulators will be installed atop key government agencies, sweeping away regulations regarded by some as onerous, but many said it was too early to tell what economic policies will be implemented by the incoming administration. "I am quite optimistic that this administration is going to run a very, very pro-growth agenda," Goldman Sachs (GS.N) , opens new tab CEO David Solomon said on Tuesday at Reuters NEXT. To view the live broadcast of the World Stage go to the Reuters NEXT news page: https://www.reuters.com/world/reuters-next/ Sign up here. https://www.reuters.com/markets/us/us-bank-executives-expect-trump-ease-rules-fuel-growth-2024-12-11/
