Stock Market News: Debt ceiling wrangling, American Airlines lifts outlook, Bud Light sales sink

U.S. stocks fell on Wednesday as a deal to raise the federal debt ceiling headed toward a crucial vote in Congress, while unexpectedly strong labor market data rattled investors who fear the Federal Reserve might hike interest rates again in June.

The House of Representatives is expected to vote in the evening on a bill to lift the $31.4 trillion debt limit, a critical step to avoid a destabilizing default that could come early next week without congressional approval.

House passage would send the bill to the Senate, where debate could stretch to the weekend, just before the June 5 date when the government could start to run out of money.

But most analysts foresee the bill's approval and U.S. President Joe Biden said on Wednesday he expected the debt ceiling bill on his desk by next Monday.

The certification of the Boeing 737 MAX 7 is taking a "considerable amount of time" due to new documentation requirements, but the company still believes it can be certified by the end of the year, a Boeing official said on Wednesday.

The company is down to a "handful of documents" required by the Federal Aviation Administration as it proceeds through the regulatory process necessary to approve the 737 MAX 7 to enter service, said Mike Fleming, Boeing's senior vice president for commercial development programs.

Exxon Mobil Corp. shareholders on Wednesday overwhelmingly supported the company's views on climate reports and strategies, rejecting proposals for report on methane, greenhouse gas reporting and oil-spill preparations by a wide margin.

None of the initiative proposals received more than 36% of votes cast, according to early results at the online shareholder meeting. Several of the proposals won only low-double digit support.

Results showed a lessening of support for proposals designed to strengthen oil and gas firms contributions to tackling climate change. After winning some ground earlier this decade, the initiatives lost ground after the worries soared over supply and prices following Russia's invasion of Ukraine.

A proposal to increase Exxon's methane-gas measurement reporting won 36% of votes cast, the largest for any climate initiative. A similar methane-gas reporting request won 51% of votes last year.

BlackRock Inc Chief Executive Laurence Fink said on Wednesday that inflation remains sticky and the Federal Reserve may need to hike rates further to contain price pressures.

Speaking at a Deutsche Bank financial services conference, Fink said a U.S. recession, if it occurs, would likely be modest.

Walmart investors voted against all 9 shareholder-led proposals during the retail giant's annual meeting on Wednesday, a preliminary tally by the company showed.

Shareholders were asked to vote on a number of new proposals including revealing its exposure to China and conducting an independent review of its safety practices related to gun violence. Shareholders were also asked to vote on an additional "floor proposal" tabled during the meeting, that urged Walmart to disclose its funding to conservative political groups.

Proposals needed 51% of shareholder votes to win, which Walmart would adopt if passed. Walmart will provide the final tally in an upcoming U.S. Securities and Exchange Commission filing.

Shareholders also voted in favor of company-led proposals including electing each of its 11 directors for a one-year term and compensation for its chief executive and other top leaders for 2023, the company said.

U.S. field production of crude oil rose in March to 12.696 million barrels per day, the highest since March 2020, when the coronavirus pandemic began to decimate global energy demand, Energy Information Administration data showed on Wednesday.

U.S. product supplied of crude and petroleum products - a proxy for demand - rose to 20.449 million bpd, the highest since November 2022, EIA data showed. Product supplied of finished motor gasoline rose in March to 9.007 mln bpd, the highest since August 2022.

Electric vehicles may not reach cost parity with internal combustion engine vehicles until after 2030, Ford Chief Executive Jim Farley said on Wednesday.

Speaking at an investor conference, Farly said EVs will continue to be more expensive than their ICE counterparts until the second and third generation vehicles go into production after 2025.

Between 2030 and 2035, Farley added, much of the EV cost savings will come from "dramatically lower labor content" because the vehicles will be simpler to build with fewer parts, and will be fitted with smaller batteries that use cheaper materials.

He also predicted lower distribution costs from selling EVs online, as well as higher revenue from new software-driven digital services.

Lower fuel prices coupled with improving demand are giving American Airlines a tailwind. The carrier now says total revenue per available seat mile will be between 1.0% to 3.0% less than the prior guidance of 2%-4% drop. Additionally, the per gallon cost of jet fuel will be as high as $2.65 vs. a prior forecast of $2.75. The update was disclosed in a filing with the Securities and Exchange Commission.

JPMorgan Chase & Co CEO Jamie Dimon on Wednesday warned "uncertainty" caused by the Chinese government could hurt investor confidence at home and abroad, and said the U.S. and China need "real engagement" on security and trade issues.

Dimon is on his first visit to China since the beginning of the COVID-19 pandemic and his first since he joked in 2021 that JPMorgan will outlast China's Communist Party, sparking outrage in China and prompting him to express regret.

"If you have more uncertainty, somewhat caused by the Chinese government . . . it’s going to not just change foreign direct investment. It’s going to change the people here, their own confidence to invest," Dimon said in an interview with Bloomberg TV.

The world's second-largest economy is emerging from three years of pandemic lockdowns, but the recovery has been uneven. China's factory activity shrank faster than expected in May on weakening demand, according to data released on Wednesday.

Lightmatter, a Boston-based startup using light for AI computing, said on Wednesday it raised $154 million and tripled its valuation as customers in need of faster, more energy efficient computing for AI work are buying its systems.

"We use light to link computer chips together and we also use light to do calculations for deep learning," Lightmatter co-founder and CEO Nick Harris said. "The reason that we're getting these customers and data center scale deployments with our interconnect is that the generative AI boom is driving high-end chips like crazy.

"Light has been used for decades in the telecommunications industry to move data across the world with fiber optic cables. Now, large tech companies are looking to use light-based technology in their data centers to reduce power costs. The challenge has been to shrink the size of the devices used to create or control light.

As chips become more advanced, they consume more power. "It can be up to half of the entire operating cost of a data center just getting the power to the chips," Harris said, adding that light transmits information far more energy efficiently than electrical signals traveling over wires.

Target shareholders are feeling the heat after marketing controversies over Pride merchandise shave billions of market value off the retailer.

The controversy of Bud Light's woke push continues to be a headwind for parent Anheuser-Busch's bottom line.