2024-12-05 21:22

New project outlays to drop as major investments end Fourth-quarter charges reflect job cuts, asset sales, writedowns Budget excludes any costs for proposed Hess deal HOUSTON, Dec 5 (Reuters) - U.S. oil producer Chevron on Thursday said it will take up to $1.5 billion in fourth-quarter charges for restructuring, asset impairments and property sales costs. Much of the charges are for job cuts and relocations planned for the next two years, the company said in a statement. Chevron did not disclose how many jobs would be lost among its 45,000 workers. The cost cutting and asset sales come amid a year-long profit slide that required borrowing to cover shareholder payouts. The No. 2 U.S. oil producer earlier said it aimed to cut up to $3 billion in costs through 2026. Oil companies have turned to acquisitions to lift reserves and output, requiring less expenditures on new fields. Chevron will cut 2025 project spending by $2 billion from about $19 billion this year, after offering $53 billion to buy rival Hess (HES.N) , opens new tab. "The 2025 capital budget along with our announced structural cost reductions demonstrate our commitment to cost and capital discipline," CEO Michael Wirth said in a statement. The lower project spending also reflects the end of big outlays at its Kazakhstan operations, recent sales of Canadian, Alaskan and Congolese oil and gas operations, and lower spending on U.S. shale operations. New expenditures on oil and gas output will fall about $1 billion, while refining will fall about $300 million compared to this year. The budget excludes any costs for Chevron's proposed deal for Hess that has been stalled by challenges from Exxon Mobil (XOM.N) , opens new tab and CNOOC (600938.SS) , opens new tab, Hess' partners in a Guyana oil venture. Severance pay and relocations will account for up to $900 million of the after-tax charges, and asset impairments and sales of properties will add up to $600 million, the company said. Chevron said the asset impairments would not affect adjusted earnings. Financial firm LSEG projects Chevron fourth-quarter profit of $4.35 billion, or $2.42 per share, from $6.45 billion, or $3.45 per share, in the year-ago quarter. Charges have become a nearly annual exercise. Chevron took a $3.7 billion impairment charge a year ago, $1.1 billion in 2022 and $4.8 billion in 2020. Sign up here. https://www.reuters.com/business/energy/chevron-take-up-15-billion-fourth-quarter-charges-2024-12-05/

2024-12-05 21:19

Dec 17 (Reuters) - U.S. utilities are finally signing concrete supply deals with data-center operators as the artificial-intelligence wave sparks a surge in power demand, paving the way for higher profits in the coming quarters. Data centers are expected to account for 8% of the power generated in the U.S. by 2030, compared with 3% in 2022, according to a Goldman Sachs report in May. Here are some deals announced by utilities in 2024: Constellation Energy (CEG.O) , opens new tab signed an exclusive deal with Microsoft (MSFT.O) , opens new tab to restart one of the units at the Three Mile Island nuclear plant in Pennsylvania. Under the agreement, the utility will provide 835 megawatts (MW) of energy to the tech giant's data centers. The deal would also mark the first ever restart of a nuclear power plant in the U.S. after it was shut down. Ameren (AEE.N) , opens new tab signed a supply deal with a data center with a power capacity of 250 MW. It has also received expansion commitments and executed new contracts for more 85 MW of additional load for smaller data centers and other industries across Missouri and Illinois. Alliant Energy (LNT.O) , opens new tab said it has executed multiple power supply deals with data centers, but did not disclose details. Exelon (EXC.O) , opens new tab said it is in the engineering phase for more than 5 gigawatts (GW) of data center capacity. Some data-center customers have also made deposits for ComEd - Exelon's subsidiary - to order transmission and breakers, the firm said during a post-earnings call. American Electric Power (AEP.O) , opens new tab signed letters of intent to power an additional 15 GW of data centers by the end of the decade. Xcel Energy (XEL.O) , opens new tab will supply power to Meta Platforms' (META.O) , opens new tab data center in Minnesota, expected to come online in late summer 2025. Entergy (ETR.N) , opens new tab has received legislative approval for investment in transmission and generation to serve Amazon's (AMZN.O) , opens new tab upcoming Amazon Web Services (AWS) facility in Mississippi. The utility has also signed a deal with Meta (META.O) , opens new tab to supply power to the Facebook-parent's hyperscaler data center located in Louisiana. The center would be Meta's largest data center in the world. Pinnacle West Capital (PNW.N) , opens new tab has more than 4,000 MW of committed data center customers, not including the backlog of more than 10,000 data center requests it has received. AES (AES.N) , opens new tab signed an agreement with Google (GOOGL.O) , opens new tab for 310 megawatts to support its Ohio data centers. It further expanded a previously announced partnership with Google and signed a 15-year power purchase agreement for 727 megawatts in Texas. Talen Energy (TLN.O) , opens new tab announced a deal to supply electricity and its 960 MW data center campus to Amazon's AWS in Pennsylvania. NextEra's renewables segment saw a rise of 3 GW worth of renewables and storage projects in second quarter, including Google's 860 MW demand for its data center power. NorthWestern Energy (NWE.O) , opens new tab has signed a letter of intent to provide energy services to a data center developer in Montana. The energy service load is expected to be a minimum of 50 MW beginning 2027 and would grow to 250 MW or more by 2029. Sign up here. https://www.reuters.com/business/energy/us-utilities-signal-booming-demand-data-centers-ai-takes-root-2024-08-12/

2024-12-05 21:11

Keith Gill post sparks another meme stock jump GameStop shares briefly halted for volatility before trading higher Dec 5 (Reuters) - GameStop's (GME.N) , opens new tab shares jumped on Thursday after a cryptic post from meme stock influencer Keith Gill, who shot to notoriety after his online personas and bullish bets on the video game retailer sparked a trading frenzy among mom-and-pop investors. Gill posted , opens new tab a picture resembling a Time magazine cover from 2006 with a computer screen on social media platform X. Following his post, GameStop's shares spiked and traded as high as $30.87. The stock closed up 6%. Known as "Roaring Kitty" on YouTube and "DeepF***ingValue" on Reddit's (RDDT.N) , opens new tab popular WallStreetBets, Gill was a key figure in the so-called "Reddit rally", in which GameStop stock surged 1,600% at one point in Jan. 2021, crushing hedge funds that had bet against the videogame retailer. Steve Sosnick, chief strategist at Interactive Brokers, noted that this is characteristic of a pattern that has evolved in the trading of GameStop: the stock's price will rally, then when it settles down a bit or retreats, Gill's "Roaring Kitty" persona tends to emerge with a social media post. "We've seen that pattern again recently; the stock was at $21 earlier in November but then rallied to $30 or so around Thanksgiving, only to give back most of those gains over the last couple of days." On Thursday, about 300,000 GameStop options contracts had changed hands by 2:14 p.m. (1914 GMT), at about 1.5 times the usual pace, according to data from options analytics firm Trade Alert. The stock's 30-day implied volatility — how much traders expect the shares to move around over the short term — jumped to a 3-week high of 132%, up from 93% in the previous session, data showed. Contracts betting on the shares finishing above $30 by Friday were the most actively traded options, with some 32,000 of them traded by late afternoon. 'ANIMAL SPIRITS' Gill resurfaced on social media earlier in 2024, after a three-year hiatus leading to a deluge of excited messages from his followers, many of whom have likened the social media phenomenon to a David who took on Wall Street's Goliaths and won. "The re-emergence of the popularity of meme stocks tends to follow any general resurgence in market enthusiasm and animal spirits," said Art Hogan, market strategist at B. Riley Wealth Management. "Whenever markets are at or near all-time highs, that particular part of the speculative side of stocks tends to pop up again." The meme stock rally in 2021 was set off by Gill's posts on WallStreetBets subreddit about the gains he had made on his investments in the highly shorted firm. The rally spread to other highly shorted stocks including AMC Entertainment (AMC.N) , opens new tab as Reddit users banded together to squeeze bearish hedge funds, costing them billions in losses and drawing scrutiny from U.S. regulators. The entire episode inspired Craig Gillespie's 2023 movie "Dumb Money". Other so-called meme stocks also traded higher on Thursday after Gill's post. Shares of Unity Software (U.N) , opens new tab closed up 5%, while cinema chain AMC, another darling of retail investors from 2021, climbed 6%. "It wouldn't surprise me if the faithful haven't been distracted by other things. Crypto has stolen GameStop's thunder recently," Sosnick said. The video game retailer's stock is up around 76% so far this year. Meanwhile, bitcoin has surged more than 130% and surpassed the $100,000 mark earlier on Thursday, fueled by optimism over easing regulatory headwinds, in what is a stunning rally for the world's largest cryptocurrency. Sign up here. https://www.reuters.com/technology/gamestop-shares-jump-cryptic-roaring-kitty-post-sparks-retail-interest-2024-12-05/

2024-12-05 21:05

Judge rejects Boeing's plea deal over diversity provision Victims' families had called plea deal a 'sweetheart' agreement Boeing faces potential renegotiation or appeal of plea deal Dec 5 (Reuters) - A U.S. judge on Thursday rejected Boeing's agreement to plead guilty to fraud in the wake of two fatal 737 MAX crashes, faulting a diversity and inclusion provision in the deal. Boeing did not immediately comment. The U.S. Department of Justice, which brokered the plea bargain with Boeing, is reviewing the opinion, a spokesperson said. Boeing and the DOJ's options could include appealing the judge's rejection of the plea deal or presenting a renegotiated agreement for court approval. U.S. District Judge Reed O'Connor in Fort Worth, Texas, who has a record of ruling in favor of conservative causes, seized on a single sentence in the plea agreement mentioning the DOJ's diversity policy regarding the selection of an independent monitor to audit the planemaker's compliance practices. He had asked both Boeing and prosecutors to further brief him on it in October. Boeing (BA.N) , opens new tab and the DOJ now have 30 days to update the court on how they plan to proceed in the case, O'Connor ruled. Judges weighing plea deals typically do not upend them over issues that the parties to the agreement have not disputed. In the rare cases that they do, it is usually because the judge wants to impose a different punishment than prosecutors have agreed to. The plea bargain also "marginalizes" the judge in the selection and oversight of the independent monitor, and forbids imposing a probation condition requiring Boeing to comply with the monitor's anti-fraud recommendations, O'Connor said in his decision. He said the agreement was "not in the public interest." Relatives of the victims of the two 737 MAX crashes, which occurred in 2018 and 2019 and killed 346 people, have called the plea agreement a "sweetheart" deal that failed to adequately hold Boeing accountable for the deaths of their loved ones. The two plane crashes occurred in Indonesia and Ethiopia over a five-month period. The families had briefly referenced the DOJ diversity and inclusion policy in court filings opposing the plea agreement, but did not detail concerns about it. "Judge O’Connor’s emphatic rejection of the plea deal is an important victory" for the victims' families, said Paul Cassell, a lawyer representing them. "Judge O’Connor has recognized that this was a cozy deal between" the government and Boeing "that failed to focus on the overriding concerns: holding Boeing accountable for its deadly crime and ensuring that nothing like this happens again in the future," Cassell said. Cassell said he hoped the decision would result in the agreement being renegotiated to specifically address the passengers and crew who perished in the plane crashes. An accepted plea deal would have branded Boeing a convicted felon for conspiring to defraud the U.S. Federal Aviation Administration about problematic software affecting the flight control systems in the planes that crashed. Boeing had agreed to pay a fine of up to $487.2 million and spend $455 million to improve safety and compliance practices over three years of court-supervised probation as part of the deal. Victims' relatives want Boeing and its executives charged with crimes holding them responsible for the deaths of their loved ones and any evidence of wrongdoing presented in a public trial. They have also argued Boeing should have to pay up to $24.78 billion in connection with the crashes. In May, the DOJ found Boeing had violated the terms of a 2021 agreement that had shielded it from prosecution over the crashes. Prosecutors then decided to criminally charge Boeing and negotiate the current plea deal. The decision followed a Jan. 5 in-flight blowout of a doorpanel on an Alaska Airlines (ALK.N) , opens new tab jet that exposed ongoing safety and quality issues at Boeing. The judge's objections largely centered on the government's diversity and inclusion policy covering the selection of the independent monitor to oversee Boeing for three years. Such policies are commonly known as diversity, equity and inclusion, or DEI. DEI policies have become a flashpoint in America's culture wars, which refer to conflicts between liberal and conservative values. Supporters contend the policies combat unconscious bias, inequity and discrimination in hiring while opponents argue they focus on characteristics such as race and gender at the expense of core job qualifications. "The plea agreement requires the parties to consider race when hiring the independent monitor," O'Connor wrote in his decision. "In a case of this magnitude, it is in the utmost interest of justice that the public is confident this monitor selection is done based solely on competency." O'Connor, appointed in 2007 by Republican then-President George W. Bush, gained prominence for rulings favoring conservative litigants, including finding Obamacare unconstitutional in a decision the U.S. Supreme Court later reversed. He also previously invalidated a Biden administration attempt to deter schools from discriminating against students based on gender identity or sexual orientation. Shirley Emehelu, former New Jersey executive assistant attorney general, said she expected the DOJ and the company would try to renegotiate the deal quickly, though it was unclear if that would be done before President-elect Donald Trump takes office on Jan. 20. "The monitor that ultimately will be chosen will face the challenge of a remarkable level of scrutiny by the court over their undoubtedly highly complex work," she said. Sign up here. https://www.reuters.com/legal/us-judge-rejects-boeing-plea-deal-fatal-crashes-2024-12-05/

2024-12-05 21:00

Synopsys falls after forecasting FY25 revenue below estimates Focus on Friday's payrolls data Indexes: Dow down 0.6%, S&P 500 down 0.2%, Nasdaq down 0.2% NEW YORK, Dec 5 (Reuters) - U.S. stocks ended lower on Thursday, with UnitedHealth down sharply and technology shares easing as investors awaited Friday's jobs report. The S&P 500 technology index (.SPLRCT) , opens new tab fell 0.2% after hitting a record closing high on Wednesday, when all three major U.S. stock indexes also notched closing highs. Shares of Synopsys (SNPS.O) , opens new tab fell 12.4% after the chip design software firm forecast fiscal 2025 revenue below Wall Street expectations, in part due to a slump in China sales. UnitedHealth's (UNH.N) , opens new tab stock dropped 5.2% and was the biggest weight on the Dow and S&P 500, while the S&P 500 healthcare index (.SPXHC) , opens new tab fell 1.1%. Shares of Cigna (CI.N) , opens new tab were down 2.3%, while Molina Healthcare (MOH.N) , opens new tab fell 3.2%. Health insurance companies are reassessing the risks for their top executives the day after the murder of UnitedHealthcare CEO Brian Thompson in Manhattan. UnitedHealthcare is part of UnitedHealth Group. Forecasters believe Friday's employment report will show nonfarm payrolls increased by 200,000 jobs in November, a Reuters survey showed. In October, payrolls rose 12,000, the smallest rise since December 2020. Data earlier in the day showed the number of Americans filing new applications for unemployment benefits rose slightly last week. Daniel Morgan, portfolio manager at Synovus Trust in Atlanta, Georgia, said investors are digesting recent economic data and looking ahead to Friday's employment report. "Obviously the Street is going to be trading on what the Fed is going to do," he said. The Dow Jones Industrial Average (.DJI) , opens new tab fell 248.33 points, or 0.55%, to 44,765.71, the S&P 500 (.SPX) , opens new tab lost 11.38 points, or 0.19%, to 6,075.11 and the Nasdaq Composite (.IXIC) , opens new tab lost 34.86 points, or 0.18%, to 19,700.26. On Wednesday, Federal Reserve Chair Jerome Powell said the U.S. economy is stronger than the central bank had expected when it started cutting rates in September, and he appeared to signal support for a slower pace of reductions. Markets are pricing in about a 70% chance of a quarter-point cut in interest rates this month. Cryptocurrency and blockchain-related stocks lost steam after surging earlier in the day when bitcoin , the world's largest cryptocurrency, stormed above the $100,000 mark for the first time. MicroStrategy (MSTR.O) , opens new tab, the largest corporate holder of bitcoin, ended down 4.8%. Declining issues outnumbered advancers by a 1.25-to-1 ratio on the NYSE. There were 378 new highs and 74 new lows on the NYSE. On the Nasdaq, 1,488 stocks rose and 2,833 fell as declining issues outnumbered advancers by a 1.9-to-1 ratio. Volume on U.S. exchanges was 14.12 billion shares, compared with the roughly 14.7 billion average for the full session over the last 20 trading days. Sign up here. https://www.reuters.com/markets/us/futures-stall-after-wall-streets-record-high-closing-2024-12-05/

2024-12-05 19:42

Trafigura board member and former CFO takes stand as witness Swiss case involves alleged bribes paid to Angolan official Director Lorinet says 'not possible' to eliminate all risks Court shown documents from ex-Trafigura employee and consultant BELLINZONA, Switzerland, Dec 5 (Reuters) - A Swiss judge questioned a Trafigura board member on Thursday over the trading firm's dealings with a consultant referred to in the firm's corruption indictment as "Mr. Non-Compliant" who was allegedly part of a chain of intermediaries used to bribe an Angolan official. Swiss prosecutors say that Trafigura and three other defendants paid bribes of more than $5 million via a network of middlemen to an Angolan official to win oil deals from 2009-2011. The case is the country's first trial of a company charged with corrupting a foreign official to go before its highest court. Trafigura, which describes itself as a leading supplier of commodities, has said that the anti-bribery and anti-corruption controls and the compliance programme in place at the time at its parent company met legal requirements and good practice standards. Trafigura Director Pierre Lorinet, who was chief financial officer when the payments were allegedly made, took the stand as a witness on Thursday and was questioned for over four hours about the trading house's policies. "We cannot guarantee zero risk, it's not possible," said Lorinet, who is not a defendant in the case. The court was shown memos, emails and messages involving an ex-Trafigura employee who the indictment says was nicknamed "Mr. Non-Compliant" by late Trafigura founder Claude Dauphin because he did things that were forbidden inside the group. Dauphin's family lawyer Roman Pinösch said the only evidence of the nickname came from the ex-employee's personal notes and memos - evidence that he has been denied permission to see. The family, including son Guillaume who is attending the trial, has previously said Dauphin has been singled out unfairly. The indictment alleged "Mr. Non-Compliant," who worked for Trafigura from 1997-2007 and has given evidence to prosecutors, offered consulting services to Trafigura. He was also a controller, or accountant, at a British Virgin Islands (BVI)-registered company through which payments to the Angolan official flowed, the indictment said. Reuters did not name the former employee, who is not a defendant in the case, because Swiss privacy rules forbid it. He could not be reached for comment. When asked by Swiss judge David Bouverat about the BVI firm's payments, Lorinet said: "It is not possible to verify every payment each day. It would require an army." He said Trafigura made hundreds of such transactions daily and did not have direct knowledge of the alleged payments in this case. 'ON BEHALF OF TRAFIGURA' The panel of judges showed a memo obtained by prosecutors they said was written by "Mr. Non-Compliant" in which he said he "never applied for this role" and said that Trafigura employees at the time, including Lorinet, had asked him to take it on. Lorinet acknowledged the memo referred to him, but said that other details were unclear. Asked by the judge who had hired the consultant, Lorinet said: "I don't know. It wasn't me." Judges showed another email written by the consultant with the sign-off: "As instructed for and on behalf of Trafigura Beheer". Asked by Bouverat why an external consultant would say this, Lorinet said: "I don't know why he used that signature." Judges showed the court an email dated November 2009 between the consultant and former Trafigura executive Mike Wainwright indicating the consultant had been granted permission to use Trafigura's internal system Pluto, used for trading and invoices. Lorinet said that did not appear to be a problem because he was a former Trafigura employee and had completed training. Wainwright, now retired, is a defendant in the case in a rare instance of a top trading executive being tried in a criminal court. His lawyers have said he rejects all the allegations against him and is confident the case will be dismissed. Trafigura said in 2019 it would stop using intermediaries for business development purposes after a series of investigations into its dealings. Earlier this week, the court rejected arguments made by Trafigura's lawyers to either throw out the trial or to strike out a portion of evidence from a key witness. The court, however, is weighing a request to discard a portion of the evidence that is more than 15 years old, citing a statute of limitations. That would exclude evidence concerning the visit of the Angolan official to Geneva in April 2009 and the opening of a Swiss bank account. The defendants face a maximum sentence of five years in prison. Trafigura faces a fine of up to 5 million Swiss francs ($5.60 million), although a higher compensation penalty is possible. The final ruling can be appealed to the same court. Sign up here. https://www.reuters.com/markets/commodities/trafigura-director-quizzed-mr-non-compliant-swiss-corruption-case-2024-12-05/