2024-05-21 23:25

May 21 (Reuters) - Judges on California's top court on Tuesday considered whether voters had the power to allow app-based services such as Uber (UBER.N) New Tab, opens new tab and Lyft (LYFT.O) New Tab, opens new tab to classify drivers in the state as independent contractors rather than as employees with greater benefits. The seven-member California Supreme Court heard oral arguments in San Francisco in a lawsuit by the Service Employees International Union (SEIU) and four drivers who say a 2020 ballot measure known as Proposition 22 was unconstitutional. The measure exempts app-based drivers from a 2019 state law that narrowed the circumstances in which many workers can be treated as contractors. Whether gig workers should be treated as employees or contractors is a crucial issue for the ride service industry, Employees are entitled to the minimum wage, overtime pay, reimbursements for expenses and other protections that do not extend to independent contractors, who as a result can cost companies up to 30% less, according to several studies. Uber, Lyft and other app-based services spent more than $200 million on a campaign to pass Prop 22 and have said that without it, the increased costs could force them to stop doing business in California, the largest U.S. state. Prop 22, which was passed in November 2020 by nearly 60% of voters in California, allows app-based transportation services to classify drivers as independent contractors as long as they are paid at least 120% of the minimum wage while passengers are in the car and drivers receive expense reimbursements and subsidies to pay for health insurance. A lower appeals court last year rejected SEIU's argument that Prop 22 improperly limited the legislature's exclusive power to regulate the state's workers' compensation system by barring app-based drivers from receiving those benefits, which are only granted to employees. Most of Tuesday's arguments revolved around whether that authority, outlined in the state constitution, was truly exclusive. At least three judges suggested that California's constitution requires the legislature to share lawmaking power with the electorate, just as it mandates that bills must be presented to the governor before they become law. They told SEIU's lawyer Scott Kronland that if the legislature disapproves of Prop 22 it could pass laws extending benefits to app-based drivers. "Prop 22 … only speaks of the classification as employees or independent contractors for the purposes of the labor code,” Justice Goodwin Liu said, referring to California employment law. “But the labor code is not frozen in time.” Kronland told the court that a provision in Prop 22 barring any amendments would make it difficult for lawmakers to counteract the measure. At the same time, the judges seemed skeptical of some arguments by the state and Protect App-Based Drivers and Services, an industry-backed group that intervened in the case to defend Prop 22. Two judges suggested that giving voters control over the workers' compensation system meant that they could eliminate it altogether, which would seem to infringe on the "plenary" - or absolute - power that the constitution grants to the legislature. That "turns ‘plenary’ into ‘it’s plenary until it’s nothing.’ That doesn’t feel very plenary to me,” Justice Joshua Groban said. NATIONWIDE BATTLE California is just one front in a nationwide legal battle over the classification of gig drivers and other contract workers. Lawmakers in Minnesota passed a measure over the weekend that would set a minimum wage of $1.28 per mile and 31 cents per minute for gig drivers, replacing a higher minimum adopted by Minneapolis that spurred Uber and Lyft to threaten to cease operating in the city. Earlier this month, the top court in Massachusetts heard arguments over whether competing ballot proposals that would redefine the relationship between app-based companies and drivers should be allowed to go before voters in November. One proposal supported by industry groups mirrors Prop 22, while another would allow drivers to unionize. Last week a trial kicked off in a lawsuit by the Massachusetts attorney general accusing Uber and Lyft of unlawfully classifying drivers as contractors to avoid treating them as employees entitled to a minimum wage, overtime and earned sick time. The California Supreme Court typically issues rulings within 90 days of hearing arguments. Sign up here. https://www.reuters.com/legal/california-court-weigh-fate-law-treating-app-based-drivers-contractors-2024-05-21/

2024-05-21 23:02

LONDON, May 22 (Reuters) - Britain said on Wednesday it wanted to build a new large-scale nuclear power station in north Wales, naming a site on the island of Anglesey as its preferred location and launching talks with international energy companies about building the plant. As part of efforts to meet climate targets and boost energy security, Britain is seeking to increase its nuclear power capacity by 2050 to 24 gigawatts, equivalent to about a quarter of projected electricity demand, from about 14% currently. The Wylfa coastal site on the island of Anglesey was used for nuclear power generation between 1971 and 2015. That plant is currently being decommissioned. The new plant at the site could generate enough power for six million homes for 60 years, and would be similar in scale to projects underway at Hinkley and Sizewell in England, the government said in a statement. In 2020 Japan's Hitachi scrapped plans to build a nuclear plant at Wylfa after failing to find private investors or secure sufficient government support. The government did not name the firms that would be involved in discussions to develop the new project. Earlier in May, the Financial Times reported South Korea's Korea Electric Power Corp (KEPCO) (015760.KS) New Tab, opens new tab was in talks with the government to build a plant at Wylfa. Sign up here. https://www.reuters.com/business/energy/britain-selects-site-wales-new-nuclear-power-plant-2024-05-21/

2024-05-21 22:37

Lowe's warns of margin pressure in Q2 IBM rises after it makes more AI models open-source Nvidia options imply 8.7% swing after earnings Indexes up: Dow 0.17, S&P 0.25%, Nasdaq 0.22% NEW YORK, May 21 (Reuters) - U.S. stocks closed with slight gains on Tuesday, sending the S&P 500 and Nasdaq to record levels, as investors assessed the latest comments from Federal Reserve officials for clues on the timing of a rate cut while quarterly earnings from Nvidia drew closer. Nvidia (NVDA.O) New Tab, opens new tab, Wall Street's third-largest firm by market capitalization, will report results after the closing bell on Wednesday in what is likely to be a significant market catalyst and will test whether the outsized rally in AI-related stocks can be sustained. Nvidia's options are primed for an 8.7% swing, or $200 billion in market cap, in either direction by Friday, according to data from options analytics firm Trade Alert. The chipmaker's shares were up 0.64% on Tuesday and are up about 93% on the year, after surging nearly 240% in 2023. Investors also looked toward minutes from the Fed's most recent policy meeting, due on Wednesday, after multiple Fed officials on Tuesday reinforced the stance that it would be best for the central bank to exercise patience before starting to cut interest rates. "Investors are sort of just sitting on their hands for today because there are two important things that will be coming out tomorrow, Fed minutes combined with Nvidia earnings, so I don't think people want to make any big bets ahead of that," said Sam Stovall, chief investment strategist of CFRA Research in New York. He said the Fed was "still very much data-dependent and as a result, they're going to do what the data tells them to do and that's pretty much it, but Wall Street is going to continue to forecast, ourselves included, that the Fed will start to cut rates in September." Markets are currently pricing in a 64.8% chance for a cut of at least 25 basis points at the central bank's September meeting, according to CME's FedWatch Tool New Tab, opens new tab. The Dow Jones Industrial Average (.DJI) New Tab, opens new tab rose 66.22 points, or 0.17%, to 39,872.99, the S&P 500 (.SPX) New Tab, opens new tab gained 13.28 points, or 0.25%, to 5,321.41 and the Nasdaq Composite (.IXIC) New Tab, opens new tab gained 37.75 points, or 0.22%, to 16,832.62. The Nasdaq notched its fourth record close in the past six sessions while the S&P closed at a record for the first time since May 15. The S&P 500 traded in a range of about 27 points on the session. Retailers (.SPXRT) New Tab, opens new tab were 0.36% lower as a flurry of quarterly reports from the group signals the winding down of earnings season, with Lowe's (LOW.N) New Tab, opens new tab shares ending lower after the home improvement company warned of operating-margin pressure in the current quarter. Automotive parts retailer AutoZone (AZO.N) New Tab, opens new tab declined 3.53% after a third-quarter sales miss. Macy's (M.N) New Tab, opens new tab jumped 5.13% after the department store operator raised its annual profit forecast, despite posting a bigger-than-expected drop in sales for the first quarter. JPMorgan Chase (JPM.N) New Tab, opens new tab rose 2.01%, recovering some of Monday's 4.5% drop, helping fuel a climb in the S&P 500 banks index. International Business Machines (IBM.N) New Tab, opens new tab advanced 2.09% on plans to release a family of artificial-intelligence models as open-source software and help Saudi Arabia train an AI system in Arabic. Declining issues outnumbered advancers by a 1.07-to-1 ratio on the NYSE and by a 1.35-to-1 ratio on the Nasdaq. The S&P 500 posted 54 new 52-week highs and six new lows while the Nasdaq recorded 133 new highs and 111 new lows. Volume on U.S. exchanges was 11.39 billion shares, compared with the 11.87 billion average for the full session over the last 20 trading days. Sign up here. https://www.reuters.com/markets/us/futures-steady-fed-policy-caution-weighs-nvidia-results-awaited-2024-05-21/

2024-05-21 21:47

May 22 (Reuters) - A look at the day ahead in Asian markets. Monetary policy decisions from New Zealand New Tab, opens new tab and Indonesia are the main points of focus in Asia on Wednesday, as debate over the timing of the first U.S. rate cut ebbs and flows, and lofty equity markets consider their next step. Asian stocks retreated on Tuesday, snapping a seven-day winning streak despite the relative calm in currency and bond markets. But Wall Street crept higher, with the Nasdaq reaching a new peak ahead of Nvidia's (NVDA.O) New Tab, opens new tab first-quarter earnings report. The message on interest rates from a raft of Federal Reserve officials on Tuesday was patience. Indeed, it may be several months before policymakers are confident inflation is really falling back to target, allowing them to start cutting rates. With many stock markets around the world at record or multi-year highs, a period of cooling may be inevitable. The MSCI Asia ex-Japan index on Tuesday slipped 0.9% - its biggest fall in over a month - while Japan's Nikkei lost 0.3%, and Hong Kong's Hang Seng shed more than 2%. After Morgan Stanley's Mike Wilson rowed back on his long-standing gloomy outlook for Wall Street on Monday, another prominent bear, JP Morgan's Marko Kolanovic, reiterated his view that U.S. stocks are too expensive and should head south. He is much more upbeat on Asia, favoring Japanese and Chinese equities over U.S. markets. Japan is attractive because of inflation and monetary policy normalization, while measures to support the housing market, underweight investor positioning and cheap valuations are reasons to buy China. While the world maintains its vigil ahead of AI darling Nvidia's results on Wednesday, investors in Asia digest two monetary policy decisions and other potentially exchange rate-moving data, including Japanese trade and South Korean producer price inflation. The Reserve Bank of New Zealand and Bank Indonesia are both expected to leave their key interest rates on hold, at 5.50% and 6.25%, respectively, according to Reuters polls. The RBNZ is only expected to cut its cash rate once this year, and probably not until the final quarter. Money markets are a bit more dovish, and are currently pricing in 45 basis points of easing by year-end. After stunning markets last month with an unexpected rate hike to support the rupiah, Bank Indonesia (BI) is expected to keep its seven-day reverse repurchase rate at 6.25% and hold it there for several months, or until the Fed cuts U.S. rates. In a rare media briefing earlier this month, BI Governor Perry Warjiyo said current data shows there is no need to raise rates again, and the central bank is trying to strengthen the rupiah beyond 16,000 per dollar. The rupiah closed trading on Tuesday at 15,990 per dollar. Here are key developments that could provide more direction to markets on Wednesday: - New Zealand monetary policy decision - Indonesia monetary policy decision - Japan trade (April) Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-graphic-pix-2024-05-21/

2024-05-21 21:36

May 21 (Reuters) - Canadian copper miner Hudbay Minerals (HBM.TO) New Tab, opens new tab plans to raise $300.2 million in an equity offering to help fund near-term growth initiatives at its Copper Mountain unit among other purposes, the company said on Tuesday. Underwriters led by RBC Capital Markets and BMO Capital Markets will buy 31.6 million shares of Hudbay at $9.50 each under a bought deal. The company could raise as much as $345.2 million in gross proceeds if the underwriters exercise an over-allotment option to purchase up to an additional 15% of the shares. Hudbay said it also intends to use the proceeds to improve balance sheet flexibility and evaluate mill throughput enhancement opportunities at the Constancia mine in Peru and its New Britannia mill in Manitoba, Canada. U.S.-listed shares of the company were down 8.4% in extended trading. Copper hit a record $11,104.50 on Monday on the London Metals Exchange as a rally triggered by short covering created momentum for speculators and funds to bet on a potential long-term shortage of the metal in the transition to green energy. MTL/ Additionally, despite demand remaining weak in top consumer China, the higher prices have moved companies to restart older mines. Toronto-based Hudbay bought Vancouver-based Copper Mountain in 2023 for C$439 million ($321.59 million), where it anticipates roughly 92,000 metric tons of average copper production over the first ten years. Total initial cost for phase 1 is expected to be C$1.3 billion. ($1 = 1.3651 Canadian dollars) Sign up here. https://www.reuters.com/markets/commodities/canadas-hudbay-minerals-raise-3002-mln-bought-deal-equity-offering-2024-05-21/

2024-05-21 21:33

May 21 (Reuters) - TPC Group pleaded guilty to a Clean Air Act violation and was fined more than $30 million over blasts at its Port Neches petrochemical plant in Texas that prompted thousands of people to be evacuated in 2019, the Justice Department said on Tuesday. The company's 218-acre plant made flammable petrochemicals like butadiene and butane that are used in the manufacture of plastics, tires and gasoline. It is now only in use for storage purposes. The facility saw two explosions which released more than 11 million pounds of hazardous substances, causing over $130 million in offsite property damage. The fires were put out after burning for six days. The Houston-based firm in 2022 filed for bankruptcy protection after struggling under costs and legal claims from the fire. TPC Group has also agreed to spend around $80 million to improve its risk management program and improve safety issues at that Port Neches site and another in Houston, the statement added. It shall also pay $12.1 million in civil penalty payments through bankruptcy proceedings. Sign up here. https://www.reuters.com/business/environment/tpc-group-fined-30-million-over-2019-texas-blasts-that-caused-evacuations-2024-05-21/