STOCK MARKET NEWS: IRS $80B spending plan, Johnson & Johnson talc deal, Expedia’s ChatGPT app

Figurines are seen in front of the Expedia logo in this illustration taken Feb. 27, 2022. (Reuters/Dado Ruvic/Illustration)

Online travel booking company Expedia Group Inc said on Tuesday it launched an in-app feature powered by OpenAI’s ChatGPT for users to start conversations and receive hotel, flight and destination recommendations.

TECHNOLOGY

Expedia rolls out ChatGPT-powered travel planning feature in app

Expedia has introduced a new in-app travel planning feature powered by ChatGPT as the company leans in on bolstering its artificial intelligence tools.

Expedia and Booking Holdings Inc's Kayak are among the first travel companies to integrate generative artificial intelligence with travel search as the industry seeks ways to make travel planning easier.

The feature is only available in app and for members. The Vrbo and Hotels.com operator said the feature will also automatically save recommendations.

Treasury Secretary Janet Yellen shakes hands with new IRS commissioner Danny Werfel after the swearing-in at the IRS headquarters in Washington, April 4, 2023. (AP Photo/Jose Luis Magana)

The Internal Revenue Service will unveil its long-awaited 10-year spending plan for $80 billion in new funding to beef up enforcement and taxpayer services, U.S. Treasury Secretary Janet Yellen said on Tuesday, promising major investments in new technology and services.

ECONOMY

IRS to unveil $80B spending plan this week, Yellen says

The IRS will soon release its spending plan for the $80 billion in funding it received last year as part of President Biden's Inflation Reduction Act.

In prepared remarks at the swearing-in ceremony of new IRS Commissioner Danny Werfel, Yellen said the IRS Strategic Operating Plan will outline the agency's plans in greater detail to invest in data and analytics to help it audit large corporations, high earners and complex partnerships.

"The technology will be complemented by hiring more top talent, including accountants and attorneys," Yellen said. "These additional resources will help us peel back complex corporate structures and large taxpaying entities – and make sure that they pay what they owe."

The $80 billion in new funding for the IRS over a decade, provided through last year's climate-focused Inflation Reduction Act, is aimed at improving tax compliance and shrinking the "tax gap" between taxes owed and those paid, estimated by the Treasury at around $600 billion a year.

Kura Sushi USA, Inc. on Tuesday reported a loss of $1 million in its fiscal second quarter.

On a per-share basis, the Irvine, California-based company said it had a loss of 10 cents.

The company posted revenue of $43.9 million in the period.

Kura Sushi expects full-year revenue in the range of $185 million to $188 million.

A bottle of Johnson and Johnson Baby Powder is seen in a photo illustration taken in New York, Feb. 24, 2016. (Reuters/Mike Segar/Illustration)

Johnson & Johnson announced that its subsidiary LTL Management LLC (LTL) has re-filed for voluntary Chapter 11 bankruptcy protection to obtain approval of a reorganization plan to resolve all claims arising from cosmetic talc litigation against the company and its affiliates in North America.

Johnson & Johnson has agreed to contribute up to a present value of $8.9 billion, payable over 25 years, to resolve all the current and future talc claims, which is an increase of $6.9 billion over the $2 billion previously committed in connection with LTL’s initial bankruptcy filing in October 2021.

LTL also has secured commitments from over 60,000 current claimants to support a global resolution on these terms.

McKinsey and Company logo seen at the high profile startups and high tech leaders gathering, Viva Tech,in Paris, France, May 16, 2019. (Reuters/Charles Platiau)

Consulting firm McKinsey & Co is shutting down its corporate restructuring practice, the Wall Street Journal reported on Tuesday, citing people familiar with the matter.

Some partners in the restructuring unit, called McKinsey RTS, were laid off and others are being absorbed into other practices, the report added.

McKinsey did not immediately respond to a Reuters request for comment on the matter.

The closure was announced internally and follows numerous lawsuits and government investigations concerning McKinsey's work advising troubled borrowers, according to the report.

A pedestrian passes a "Help Wanted" sign in the door of a hardware store in Cambridge, Massachusetts, U.S., July 8, 2022. REUTERS/Brian Snyder

Job openings, a measure of labor demand, were down 632,000 to 9.9 million on the last day of February, the lowest level since May 2021, the monthly Job Openings and Labor Turnover Survey, or JOLTS report, showed. 

ECONOMY

Job openings tumble in February to lowest level in 2 years

The Labor Department reported on Tuesday that U.S. job openings fell to the lowest level since May 2021 amid the Federal Reserve's interest-rate hike campaign.

The decline was led by the professional and business services sector, where job openings fell 278,000. There were 150,000 fewer vacancies in the healthcare and social assistance industry. 

Job openings in the transportation, warehousing and utilities sector fell by 145,000.But the construction industry sought more workers, with job openings increasing by 129,000. There were an additional 38,000 vacancies in the arts, entertainment and recreation sector.

Despite the larger-than-expected decline in job vacancies reported by the Labor Department on Tuesday, the labor market remains tight, with 1.7 job openings for every unemployed person in February. 

The Department of Justice emblem at the U.S. Attorney's Office for the Southern District of Florida in downtown Miami is pictured on Jan. 25, 2023. (D.A. Varela/Miami Herald via AP, File)

The U.S. government on Tuesday filed criminal charges accusing Charlie Javice, the founder of the now-shuttered college financial planning company Frank, of defrauding JPMorgan Chase & Co into buying the startup for $175 million in 2021.

Javice, 31, was accused by the Department of Justice of repeatedly lying to the largest U.S. bank by claiming that Frank had lined up 4.25 million student customers when in fact she had data for only about 300,000.

Prosecutors said that when JPMorgan asked for a list of names, Javice paid an unnamed data science professor $18,000 to concoct a sham list of names.

JPMorgan shut down Frank in January, and Chief Executive Jamie Dimon branded the acquisition a "huge mistake" in a Jan. 13 conference call with analysts.

Javice, of Miami Beach, Florida, was charged with bank fraud, securities fraud, wire fraud and conspiracy, each of which carries a potential 20 or 30 years in prison. The Securities and Exchange Commission filed related fraud charges.

A spokesman for Javice in an email said, "Charlie denies the accusations." Her lawyer, Alex Spiro, declined to comment.

Prosecutors said Javice was arrested on Monday in New Jersey.

Microsoft founder Bill Gates waits in the basement of the Rayburn House Office Building on Capitol Hill in Washington., U.S., March 29, 2023. REUTERS/Julia Nikhinson/File Photo

Calls to pause the development of artificial intelligence will not “solve the challenges” ahead, Microsoft co-founder Bill Gates  told Reuters, his first public comments since an open letter sparked a debate about the future of the technology.

The technologist-turned-philanthropist said it would be better to focus on how best to use the developments in AI, as it was hard to understand how a pause could work globally.

His interview with Reuters comes after an open letter -- published last week and co-signed by Elon Musk and more than 1,000 AI experts – demanded an urgent pause in the development of systems "more powerful" than Microsoft-backed OpenAI's new GPT-4, which can hold human-like conversation, compose songs and summarise lengthy documents.

The experts, including Apple co-founder Steve Wozniak, said in the letter the potential risks and benefits to society need to be assessed.

TECHNOLOGY

Bill Gates weighs in on proposed AI pause: Won't 'solve' challenges

Microsoft co-founder Bill Gates says a six-month moratorium as called for by Elon Musk and others won't "solve the challenges" presented by artificial intelligence (AI).

A woman walks past a Signature Bank location in Brooklyn, New York

Insiders at collapsed Signature Bank sold more than $100 million of stock with the bank’s chairman, its former chief executive officer and his successor accounting for nearly $50 million according to the Wall Street Journal report.

The banks pivot to attract cryptocurrency companies sent it's stock to the moon, allowing executives to cash in, but the increased risk of catering to crypto companies saw the bank come crashing down to earth.

"The executives sold many of their 2021 shares in the spring at around $220. The stock continued to rise throughout the year, hitting an all-time high of $366 in early 2022." said the Wall Street Journal

Signature had filed it's inside trading documents with the FDIC, escaping investor notice. "Signature was one of only two companies in the S&P 500 that didn’t file insider-trading transactions to the SEC", the WSJ noted, "The other was First Republic Bank".

MARKETS

Signature Bank insiders sold $100M in stock during crypto surge

Sales over the past three years by the bank’s chairman, its former chief executive officer and his successor accounted for about half of the amount sold.

The new GM logo is seen on the facade of the General Motors headquarters in Detroit, Mich., Mar. 16, 2021. (Reuters/Rebecca Cook)

General Motors Co's finance chief said on Tuesday that its cost cutting target will be at the higher end of its 2023 goal after bout 5,000 General Motors Co salaried workers took buyouts to leave the company.

"I think we probably are going to come in at the higher end of the 30% to 50% of the $2 billion program realized this year," the automaker's Chief Financial Officer Paul Jacobson said during a conference organized by BofA.

GM will take a $1 billion charge in the first quarter, he said. The company had previously projected $1.5 billion in charges related to staff reductions.

CFO Paul Jacobson said demand for GM's trucks and SUVs remains strong in the United States, but because the opportunity to boost prices much further "isn't there. We have to be more urgent around cost-cutting."

The logo of German automaker BMW is seen in Brussels, Belgium February 28, 2023. REUTERS/Yves Herman/File Photo

Stellantis and BMW are in talks with Panasonic Holdings about teaming up to build electric vehicle battery plants in North America, the Wall Street Journal reported on Tuesday, citing people familiar with the talks.

Global automakers are investing billions of dollars to setup battery plants for electric vehicles, as demand surges for less polluting transport amid a push by governments to make them more affordable.

Stellantis, the world's third-largest automotive group by sales, has already announced two EV battery plants in North America - one with LG Energy Solution Ltd in Canada and another in Indiana with Samsung SDI Co.

Stellantis is discussing with Panasonic as a possible partner for the third factory, according to the WSJ report.

TECHNOLOGY

Stellantis, BMW in talks with Panasonic over new EV battery plants

Car and battery makers are spending tens of billions of dollars to build capacity for EV batteries and making choices on technology now that could shape the future of the industry.

Pile of coal in an active coal mine located next to a new solar power plant development site in Hurley, western Virginia, May 11, 2021. (Reuters/Dane Rhys)

President Joe Biden's administration is making $450 million available for solar farms and other clean energy projects across the country at the site of current or former coal mines, part of his efforts to combat climate change.

As many as five projects nationwide will be funded through the 2021 infrastructure law, with at least two projects set aside for solar farms, the White House said Tuesday.

The White House also said it will allow developers of clean energy projects to take advantage of billions of dollars in new bonuses being offered in addition to investment and production tax credits available through the 2022 Inflation Reduction Act. The bonuses will "incentivize more clean energy investment in energy communities, particularly coal communities,'' that have been hurt by a decade-plus decline in U.S. coal production, the White House said.

A man walks a dog through a neighborhood severely damaged in the aftermath of a tornado, after a monster storm system tore through the South and Midwest on Friday in Little Rock, Arkansas, U.S. April 1, 2023. REUTERS/Cheney Orr/File Photo

Arkansas storm victims were given tax relief by the IRS. They now have until July 31, 2023, to file various federal individual and business tax returns and make tax payments, the Internal Revenue Service announced today.

The IRS has said it is offering relief to any area designated by the Federal Emergency Management Agency (FEMA) as a result of tornadoes and severe storms that occurred on March 31.

Currently this includes individuals and households that reside or have a business in Cross, Lonoke and Pulaski counties qualify for tax relief.

Other areas added later to the disaster area will also qualify for the same relief. The current list of eligible localities is always available on the disaster relief page on IRS.gov.

Chairman of Credit Suisse, Axel Lehmann speaks during Credit Suisse Annual General Meeting, two weeks after being bought by rival UBS in a government-brokered rescue, at Hallenstadion, in Zurich, Switzerland, April 4, 2023. (Reuters/Pierre Albouy)

Credit Suisse's chairman apologized for taking the Swiss bank to the brink of bankruptcy, as he faced shareholder fury over the demise of the once proud flagship.

The hastily arranged takeover by Zurich-based UBS, for which Switzerland invoked emergency legislation, bypassed Credit Suisse shareholders, who would otherwise have had a say, and all but wiped them out.

Its final meeting of shareholders on Tuesday marks an ignominious end to the 167-year-old bank founded by Alfred Escher, a Swiss magnate affectionately dubbed King Alfred I, who helped to build the country's railways and then the bank.

Chairman Axel Lehmann issued an apology, saying he had run out of time to turn the bank around, despite his belief "until the beginning of the fateful week" that the it could survive.

"I am truly sorry," said Lehmann. "I apologise that we were no longer able to stem the loss of trust."

Acuity Brands Modulus office (Photo: Acuity Brands)

Acuity Brands Inc. on Tuesday reported fiscal second-quarter net income of $83.2 million.

On a per-share basis, the Atlanta-based company said it had net income of $2.57. Earnings, adjusted for stock option expense and amortization costs, were $3.06 per share.

The results exceeded Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of $2.54 per share.

The lighting maker posted revenue of $943.6 million in the period, falling short of Street forecasts. Three analysts surveyed by Zacks expected $960 million.Acuity Brands shares have risen 11% since the beginning of the year. The stock has dropped 4% in the last 12 months.

Jamie Dimon, chairman of the board and chief executive officer of JPMorgan Chase & Co., gestures as he speaks during an interview with Reuters in Miami, Fla., Feb. 8, 2023. (Reuters/Marco Bello)

The U.S. banking crisis is ongoing and will have effects for years to come, JPMorgan Chase & Co CEO Jamie Dimon wrote in a letter to shareholders on Tuesday.

"The current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come," Dimon wrote in a 43-page annual message covering a range of topics from JPMorgan's performance to geopolitics and regulation.

"The market's odds of a recession have increased," Dimon wrote.

ECONOMY

Is my bank safe from failing? Warning signs of financial trouble

Silicon Valley Bank and Signature Bank collapsed in March, triggering widespread fears of a domino effect among other mid-sized regional banks in the U.S.

Even so, it is unclear whether the disruptions will slow the consumer spending that drives the U.S. economy, Dimon wrote.

The risks that led to the current crisis were "hiding in plain sight," Dimon wrote, citing the interest rate exposure and level of uninsured deposits at Silicon Valley Bank.

Kirkland's Inc. on Tuesday reported a loss of $3.8 million in its fiscal fourth quarter.

The Brentwood, Tennessee-based company said it had a loss of 30 cents per share. Losses, adjusted for asset impairment costs and pretax expenses, were 9 cents per share.

The home decor retailer posted revenue of $162.5 million in the period.

For the year, the company reported a loss of $44.7 million, or $3.52 per share. Revenue was reported as $498.8 million.

AMC Theatre (AP Photo/LM Otero)

AMC Entertainment Holdings Inc shares tumbled 24% in extended trade on Monday, while its preferred shares jumped 21% after the movie theater chain said it agreed to settle litigation and proceed with converting its preferred stock into common shares.

MARKETS

AMC, APE shares closer to conversion following settlement

AMC Entertainment Holdings has settled a shareholder lawsuit over its plans to convert the move theater chain's "APE" preferred equity units into shares of common stock.

AMC said in a filing it had entered into a binding settlement with some investors and that it would ask a judge to lift a related status quo order, clearing its way to complete the stock conversion.

AMC said that as part of the settlement, it has agreed to pay the plaintiffs one share for every 7.5 shares they own. In a separate press release, plaintiffs lawyers said they expected the shares paid to their clients to be worth over $100 million.

Shareholders voted last month in favor of increasing the total number of authorized shares and carrying out a one-for-10 reverse stock split as part of a plan to convert its preferred shares into common shares.

The logo of Chinese-owned video app TikTok is seen on a smartphone in front of an image of the Australian national flag in this illustration picture taken April 4, 2023. (Reuters/Tingshu Wang/Illustration)

Australia banned TikTok on Tuesday from all federal government-owned devices over security concerns, becoming the latest U.S.-allied country to take action against the Chinese-owned video app.

TECHNOLOGY

Australia announces TikTok ban on federal government devices

Australia announced Tuesday that it is banning the Chinese-owned platform TikTok from its federal government’s devices over security concerns.

The ban underscores growing worries that China could use the Beijing-based company, owned by ByteDance Ltd, to harvest users' data to advance its political agenda, undermining Western security interests.

It also risks renewing diplomatic tension between Australia and its largest trading partner after things eased somewhat since Prime Minister Anthony Albanese took office in May at the head of a Labor government.

TikTok said it was extremely disappointed by Australia's decision, calling it "driven by politics, not by fact."The ban will come into effect "as soon as practicable," Attorney-General Mark Dreyfus said in a statement, adding that exemptions would only be granted on a case-by-case basis and with appropriate security measures in place.

TECHNOLOGY

Elon Musk's Twitter trades bird for shiba inu

Twitter users noticed the social media platform’s bird logo had been exchanged for a different animal — a shiba inu that appears to match the one used by cryptocurrency Dogecoin.

Twitter users on Monday noticed Elon Musk's social media platform’s well-known bird logo had been exchanged for a different animal, the move gave cryptocurrency Dogecoin a boost which continued into Tuesday.

Treasury Secretary Janet Yellen testifies before a House appropriations subcommittee hearing on Capitol Hill, March 29, 2023, in Washington. (AP Photo/Andrew Harnik)

U.S. Treasury Secretary Janet Yellen on Monday said a surprise OPEC+ oil production cut is an "unconstructive act" that will add uncertainty to the global growth outlook and to burdens on consumers at a time of high inflation.

MARKETS

Yellen says OPEC+ production cut 'regrettable' and 'not positive' for global growth

Treasury Secretary Janet Yellen said that the decision by OPEC+ to reduce oil production isn't a positive move for global growth amid persistent inflation.

"I think it's a regrettable action that OPEC decided to take," Yellen told reporters, adding it was too early to assess what the price impact would be.

"I think it's a very unconstructive act at this time when it's important to try to hold energy prices down."

Yellen said a reduction in gasoline prices from last year's peaks had helped limit inflation and it would be detrimental if the trend were reversed.

Oil benchmark prices jumped 6% on Monday, the day after the OPEC+ group jolted markets with plans to cut more production, raising fears of tightening supplies.

ECONOMY

Richard Branson's Virgin Orbit files for bankruptcy

A major blow to Richard Branson's Virgin Orbit Holdings. It filed for Chapter 11 bankruptcy on Tuesday after the satellite launch company attempted to recover from a rocket failure.

Space giant Virgin Orbit is filing for bankruptcy in a rare failure for billionaire Richard Branson, leaving Elon Musk and Jeff Bezos as the two dominant leaders in the space field.

A Tesla vehicle drives past Tesla's primary vehicle factory in Fremont, California, U.S. May 11, 2020. REUTERS/Stephen Lam

A federal jury in San Francisco on Monday ordered Tesla Inc to pay about $3.2 million to a Black former employee after the electric-vehicle maker was found to have failed to prevent severe racial harassment at its flagship assembly plant in California.

The verdict came after a week-long trial in the 2017 lawsuit by plaintiff Owen Diaz, who in 2021 was awarded $137 million by a different jury. He opted for a new trial on damages after a judge agreed with that jury that Tesla was liable but significantly reduced the award to $15 million.

Diaz accused Tesla of failing to act when he repeatedly complained to managers that employees at the Fremont, California, factory frequently used racist slurs and scrawled swastikas, racist caricatures and epithets on walls and work areas.

The jury on Monday awarded Diaz, who worked as an elevator operator, $175,000 in damages for emotional distress and $3 million in punitive damages designed to punish unlawful conduct and deter it in the future.