STOCK MARKET NEWS: Biden on State of the Union, Fed’s Powell on inflation, Bed Bath & Beyond funding

President Biden may focus on specific taxes during his State of the Union address on Tuesday.

E-commerce firm eBay Inc said on Tuesday it will lay off 500 employees globally, representing 4% of its total workforce.

Shares of the San Jose, California-based company rose about 1% in aftermarket trade.

"This shift gives us additional space to invest and create new roles in high-potential areas - new technologies, customer innovations and key markets," said Jamie Iannone, Chief Executive Officer of Ebay in a message to employees.

A raft of U.S. companies from Goldman Sachs Group Inc to Alphabet Inc have laid off thousands this year to ride out a demand downturn wrought by high inflation and rising interest rates.

Tuesday reported fiscal third-quarter earnings of $507.9 million.

The Denver-based company said it had net income of $1.31 per share. Earnings, adjusted for non-recurring gains, came to $1.12 per share.

The results topped Wall Street expectations. The average estimate of eight analysts surveyed by Zacks Investment Research was for earnings of 99 cents per share.

The maker of brands such as Vans, North Face and Timberland posted revenue of $3.53 billion in the period, also exceeding Street forecasts. Six analysts surveyed by Zacks expected $3.49 billion.V.F. expects full-year earnings in the range of $2.05 to $2.15 per share.

Fortinet Inc. on Tuesday reported fourth-quarter net income of $313.8 million.

On a per-share basis, the Sunnyvale, California-based company said it had net income of 40 cents. Earnings, adjusted for one-time gains and costs, were 44 cents per share.

The results surpassed Wall Street expectations. The average estimate of 13 analysts surveyed by Zacks Investment Research was for earnings of 39 cents per share.

The network security company posted revenue of $1.28 billion in the period, which fell short of Street forecasts. Thirteen analysts surveyed by Zacks expected $1.29 billion.

For the current quarter ending in March, Fortinet expects its per-share earnings to range from 27 cents to 29 cents.

The company said it expects revenue in the range of $1.18 billion to $1.22 billion for the fiscal first quarter. Analysts surveyed by Zacks had expected revenue of $1.27 billion.

Fortinet expects full-year earnings in the range of $1.39 to $1.41 per share, with revenue ranging from $5.37 billion to $5.43 billion.

Chipotle Mexican Grill Inc missed quarterly comparable sales expectations on Tuesday, in a sign that price hikes are taking a toll on demand for the restaurant's burritos and rice bowls.

Shares of the company fell more than 4.5% in extended trading.

While Chipotle enjoyed steady demand for its pricier menu items from its relatively wealthier customer base for much of last year, persistently high inflation across product categories is causing even affluent diners to look for cheaper options such as McDonald's.

Visits to Chipotle restaurants fell 10.2% in the fourth quarter, according to data from Placer.ai. McDonald's visits rose 29.4% in the same period.

Comparable sales at the California-based chain rose 5.6% in the fourth quarter ended Dec. 31, while analysts on average expected a 7.1% rise, according to Refinitiv IBES.  

The company reported profit of $8.29 per share, an increase of 48.6%. Analysts on average expected profit of $8.90.Chipotle forecast comparable sales growth in the high-single digits for the current quarter in its earnings release and said it expects to open 255 to 285 new restaurants in 2023.

Revenue rose to $2.18 billion from $1.96 billion in the quarter, missing estimates of $2.23 billion.

On Feb. 7, 2023, the SEC announced that it has accepted an Offer of Settlement submitted by the Company and its current Chief Financial Officer Kevin Nash.

Under the settlement, without admitting or denying the SEC’s findings in this matter, the Company and Nash have consented to the entry of an administrative civil cease-and-desist order by the SEC with respect to certain violations of the federal securities laws in the third quarter of 2015 through the second quarter of 2018.

The Company has agreed to pay a civil monetary penalty of $4.0 million, which was fully accrued by the Company in the second and third quarters of 2022. Nash has agreed to pay a civil monetary penalty of $75,000.

Bed Bath & Beyond Inc said on Tuesday it had raised about $225 million in an equity offering and that it was expecting to receive $800 million more in future installments, in a move that could help it stave off bankruptcy.

Hudson Bay Capital Management is the lead investor in the share sale by the struggling retailer, two people familiar with the matter told Reuters earlier on Tuesday before the closing of the offering was announced. Hudson Bay Capital is unrelated to Canadian department store chain Hudson's Bay Co.

The additional cash would offer the retailer a short window of only a few quarters to revive the business, Wall Street analysts said, adding that a weakening economy would diminish any chance of a successful turnaround.

"Bed Bath & Beyond declined to comment, citing regulatory requirements, while Hudson Bay did not immediately respond to a request for comment. Bloomberg News first reported the development earlier on Tuesday.

Bed Bath shares rose 3% in extended trading, after closing down 49% on Tuesday.

Wells Fargo & Co agreed to pay $300 million to settle a shareholder lawsuit claiming the bank hid that it had pushed unnecessary insurance on auto loan customers, according to documents filed in U.S. court on Tuesday.

The Construction Laborers Pension Trust for Southern California, which led the class action brought on behalf of investors, said in federal court in San Francisco that Wells Fargo and its former chief executive, Timothy Sloan, had agreed to settle.

The bank did not admit wrongdoing.

The deal requires approval from U.S. Judge James Donato, who is overseeing the case. Trial in the case had been scheduled for Feb. 27.

"While we disagree with the allegations in this case, we are pleased to have resolved this legacy issue," a Wells Fargo spokesperson said in a statement.

Royal Caribbean Group said on Tuesday it was set for record bookings during the January-March period after the company posted a smaller-than-expected quarterly loss on pent-up travel demand.

Cruise liners have reported strong booking volumes from well-to-do Americans for the so-called "wave season", a period between January and March where operators offer special cruise deals and discounts for the year.

Royal Caribbean said North America sailings were booked in line with record 2019 levels for the full year, while bookings for European itineraries accelerated during the wave season and were higher than 2019.

The cruise operator's booking volumes in the fourth quarter were also significantly higher than the corresponding period in 2019, before the pandemic outbreak shut down the industry.

Occupancy rates have strongly rebounded since restrictions imposed during the pandemic were lifted, while the easing of on-board COVID-19 protocols has boosted spending on casinos and spas.

It reported a fourth-quarter loss of $1.12 per share, compared with analysts' expectations of a loss of $1.34, according to Refinitiv IBES data..

The cruise operator forecast 2023 adjusted profit between $3.00  and  $3.60 per share, compared with estimates for a profit of $3.31.

Microsoft Corp is revamping its Bing search engine and Edge web browser with artificial intelligence, the company said on Tuesday, in one of its biggest efforts yet to lead a new wave of technology and reshape how people gather information.

Microsoft is staking its future on AI through billions of dollars of investment as it directly challenges Alphabet Inc's Google. Working with the startup OpenAI, the company is aiming to leapfrog its rival and potentially claim vast returns from tools that speed up all manner of content creation, automating tasks if not jobs themselves.

The new Bing search engine is "your AI-powered robot for the web," said Microsoft Consumer Chief Marketing Officer Yusuf Mehdi, noting that it is live in limited preview on desktop computers and will be available for mobile devices in coming weeks.Bing will be powered by AI and run on a new, next-generation "large language model" that is more powerful than ChatGPT, Mehdi said.

A chatbot will help users refine queries more easily, give more relevant, up-to-date results, and even make shopping easier.Bing ranks a distant second to Google in terms of search.

Copper prices rose on Tuesday from a four-week low in the previous session as a dollar rally paused and global equities steadied following a sell-off.

Strong U.S. employment data last week raised the specter of higher than expected interest rates, turning markets cautious and boosting the safe-haven dollar.

Copper and equities are both bets on economic growth and their prices often move in tandem.

The stronger dollar hurts dollar-priced copper by making it costlier for many buyers.

Benchmark copper on the London Metal Exchange (LME) was up 0.7% at $8,932.50 a tonne at 1718 GMT, up from Monday's low of $8,808.

A federal judge on Tuesday rejected a proposal to modify Sam Bankman-Fried's bail conditions, despite an agreement between the FTX cryptocurrency exchange founder and prosecutors to address potential witness tampering concerns.

U.S. District Judge Lewis Kaplan in Manhattan did not provide reasons for the denial, and said a hearing on bail remains scheduled for Feb. 9.

A spokesman for Bankman-Fried declined to comment. The office of U.S. Attorney Damian Williams in Manhattan also declined to comment.

Bankman-Fried, 30, has been free on $250 million bond and living in Palo Alto, California, with his parents, who guaranteed the bond, since pleading not guilty to looting billions of dollars from the now-bankrupt FTX.

Zoom Video Communications said on Tuesday it would cut 15% of its workforce, or about 1,300 jobs, and trim base pay for its executive leadership as pandemic-fueled demand for the company's video conferencing services slows.

Announcing the layoffs, Chief Executive Eric Yuan also said that he will take a salary cut of 98% for the coming fiscal year, foregoing his fiscal 2023 corporate bonus.

"We worked tirelessly... but we also made mistakes. We didn't take as much time as we should have to thoroughly analyze our teams or assess if we were growing sustainably, toward the highest priorities," the top boss said.

The company, which became a household name during lockdowns due to the popularity of its video-conferencing tools, has seen its revenue growth slow.

Analysts are forecasting Zoom's revenue to have risen just 6.7% in fiscal 2022 after a more than four-fold jump in revenue and a nine-fold surge in profit increase in 2021. Profit is estimated to have fallen 38% in 2022.

Walt Disney Co said on Monday it had set its annual shareholder meeting on April 3, with a focus on activist investor Nelson Peltz's bid seeking a seat on the media and entertainment conglomerate's board.

The board recommends shareholders vote against a proposal of Peltz's Trian Group that would reverse recent board changes to bylaws and against a shareholder proposal requesting a report on the company's reliance on China operations.

Earlier this month, Peltz's hedge fund Trian Fund Management wrote to Walt Disney shareholders to make the case for replacing board director Michael Froman.

In its letter to shareholders, Disney wrote Peltz "has demonstrated that he does not understand Disney's businesses" and that he "lacks the perspective and experience to contribute to the objective of delivering shareholder value in a rapidly shifting media ecosystem."

Peltz has served on 11 public company boards, including at Procter & Gamble Co. He has said these companies on average outperformed the broader stock market index during his time as a director on their boards.

Digital Currency Group (DCG) is selling shares in several of its cryptocurrency funds at a high discount, and has started offloading its holdings in investment vehicles run by subsidiary Grayscale, the Financial Times reported on Tuesday.

Woes have piled up for SoftBank-backed DCG with its lending unit Genesis filing for bankruptcy protection, owing creditors at least $3.4 billion after being toppled by a market rout along with exchange FTX and lender BlockFi.

The reported move comes as DCG is trying to raise funds to support its collapsed lending units under Genesis.

A quarter of DCG's stock in its ethereum fund has been sold, raising as much as $22 million in several trades since January 24, the newspaper said, citing U.S. securities filings seen by them.

DCG has also moved to sell smaller blocks of shares in its Litecoin Trust, Bitcoin Cash Trust, Ethereum Classic Trust and Digital Large Cap Fund, the report added.

DCG and Grayscale did not immediately respond to Reuters request for comment.

DCG, owned by Barry Silbert, owns a portfolio of crypto companies in addition to Genesis, including crypto news and events site CoinDesk and New York-based Grayscale, a major digital asset manager. Those companies are not bankrupt.

Boeing is planning to cut 2,000 jobs in its finance and human resources departments in 2023.

The company said late last month it intended "to hire around 10,000 employees with a focus within our business units and in engineering and manufacturing as we look to further stabilize operations, increase production and invest in innovation" in 2023. 

At the end of 2022, employment data available on the company’s website showed Boeing’s workforce totaled over 156,000. That marked a roughly 15,000 increase that, according to a Boeing spokesperson, was "driven by significant hiring in engineering and manufacturing." 

The U.S. planemaker confirmed to FOX Business Digital on Monday that the job cuts will come through a combination of attrition and layoffs. 

BP reported on Tuesday a record profit of $28 billion for 2022 and hiked its dividend, but infuriated climate activists by rowing back on plans to slash oil and gas output and reduce carbon emissions by 2030.

The blockbuster profit follows similar reports from rivals Shell, Exxon Mobil and Chevron last week after energy prices surged in the wake of Russia's invasion of Ukraine, prompting new calls to further tax the sector as households struggle to pay energy bills.

Three years after CEO Bernard Looney took the helm with an ambitious plan to pivot BP away from oil and gas towards renewables and low-carbon energy, the company said it will increase annual spending in both sectors by $1 billion with a sharper focus on developing low-carbon biofuels and hydrogen.

But it scaled back plans to cut oil output, now aiming to produce 2 million barrels of oil equivalent per day by 2030, down just 25% from 2019 levels compared with previous plans for a 40% cut.

As a result, BP reduced its ambitions to cut emissions from fuels sold to customers to 20-30% by 2030, from 35-40%. BP still aims to reduce its total emissions to net zero by 2050.

BP's $4.8 billion fourth-quarter underlying replacement cost profit, its definition of net income, narrowly missed a $5 billion company-provided analyst forecast.

The results were impacted by weaker gas trading activity after an "exceptional" third quarter, higher refinery maintenance and lower oil and gas prices.

But for the year, BP's $27.6 billion profit exceeded its 2008 record of $26 billion despite a $25 billion writedown of its Russian assets.

That allowed it to boost its dividend by 10% to 6.61 cents per share, after halving it in the wake of the pandemic, and announce plans to repurchase $2.75 billion worth of shares over the next three months after buying $11.7 billion in 2022.

China's Baidu Inc said on Tuesday it would complete internal testing of a ChatGPT-style project called "Ernie Bot" in March, as interest in generative artificial intelligence (AI) gathers steam.

A flurry of Chinese AI stocks also rallied, as the global frenzy around the Microsoft-backed chatbot sensation ChatGPT spurred speculative bets on the new technology.

Just two months after its launch, ChatGPT — which can generate articles, essays, jokes and even poetry in response to prompts — has been rated the fastest-growing consumer app in history.I

t has prompted many tech firms to double down on the heavily hyped generative AI technology, which until recently existed more in the background than as a solid contributor to the bottom line.

Google owner Alphabet Inc said on Monday it would launch a chatbot service and more AI for its search engine, while Microsoft plans its own AI reveal on Tuesday, underscoring growing rivalry to lead a new wave of computing.

Baidu, China's answer to Google, joined the frenzy on Tuesday.

BP on Tuesday reported a record profit of $28 billion for 2022 while boosting its dividend in a sign of confidence as it sharply raised overall spending plans and scaled back ambitions to reduce oil and gas output by 2030.

The company said it will increase annual spending in both sectors by $1 billion with a sharper focus on developing low-carbon biofuels and hydrogen.

But it scaled back plans to cut oil output, now aiming to produce 2 million barrels of oil equivalent per day by 2030, down just 25% from 2019 levels compared with previous plans for a 40%.

BP's $4.8 billion fourth-quarter underlying replacement cost profit, its definition of net income, narrowly missed a $5 billion company-provided analyst forecast and compared with $4 billion a year earlier and $8.2 billion in the third quarter.

For the year, BP's $27.6 billion profit exceeded its 2008 record of $26 billion despite a $25 billion writedown of its Russian assets.

Chegg Inc. on Monday reported fourth-quarter earnings of $1.9 million.

The Santa Clara, California-based company said it had profit of 1 cent per share. Earnings, adjusted for stock option expense and non-recurring costs, were 40 cents per share.

The results topped Wall Street expectations. The average estimate of eight analysts surveyed by Zacks Investment Research was for earnings of 39 cents per share.

The provider of online textbook rental services posted revenue of $205.2 million in the period, which also topped Street forecasts. Nine analysts surveyed by Zacks expected $201.6 million.

For the year, the company reported net income of $266.6 million, or $1.34 per share, swinging to a profit in the period. Revenue was reported as $766.9 million.

For the current quarter ending in March, Chegg said it expects revenue in the range of $184 million to $186 million.The company expects full-year revenue in the range of $745 million to $760 million.

The U.S. trade deficit grew by 10% in December, according to the U.S. Census Bureau.

December exports reached $250.2 billion, $2.2 billion less than November exports, while December imports reached $317.6 billion, $4.2 billion more than November imports.

The December increase in the goods and services deficit reflected an increase in the goods deficit of $7.4 billion to $90.6 billion and an increase in the services surplus of $1.0 billion to $23.2 billion.

Meanwhile, the goods and services deficit increased 12.2% to $103 billion in 2022.Also in 2022, exports increased 17.7% to $453.1 billion, as imports increased $556.1 billion or 16.3 percent.

The average goods and services deficit decreased $2.1 billion to $68.6 billion for the three months ending in December, while average exports decreased $2.6 billion to $253.0 billion in December and average imports decreased $4.7 billion to $321.6 billion.

Year-over-year, the average goods and services deficit decreased $6.4 billion from the three months ending in December 2021.

Over that time, average exports increased $24.2 billion from December 2021, while average imports increased $17.8 billion from the same period. 

Hertz Global Holdings Inc on Tuesday reported a better-than-expected quarterly profit, aided by strong demand for rental cars amid surging leisure travel and constrained production from automakers.

The car rental industry, tied closely to airline traffic and hotel bookings, has benefited from pent-up desire to travel and explore after an easing of coronavirus restrictions even as inflation remains high.

Rising costs and supply shortages faced by automakers have also made it even more unaffordable for car buyers in an uncertain economy.

However, companies like Ford Motor Co and Tesla Inc last month slashed prices on some electric vehicle models in an aggressive discounting effort to retain market share and bring more buyers to the market.

"We look to our investments in electrification and technology to yield increasing operating leverage and improved returns," Hertz Chief Executive Stephen Scherr said in a statement.

Hertz, which operates the Hertz, Dollar and Thrifty vehicle rental brands, posted an adjusted profit of 50 cents per share, ahead of the average analyst estimate of 46 cents, as per Refinitiv data.

The company reported net income of $116 million for the quarter through December, compared with a loss of $710 million a year earlier.

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