STOCK MARKET NEWS: Southwest slammed, FTX faces new lawsuit, Mega Millions jackpot climbs

MARKETS

Chemours director resigns over 'woke culture'

Chemours board member Bradley Bell resigned over the company's decision to include abortion and gender transitioning coverage in its employee benefits plan.

Chemours director Bradley Bell is stepping down from his role over disagreements with provision in the chemical company’s benefit plan which he believes to be “morally and ethically wrong.”

“I strongly disagree with the direction we are taking on abortion, which management introduced in the committee discussion as a ‘women’s health issue’ and as something that employees had been requesting. While ‘women’s health issue’ has been a common label for the topic of abortion in social discussions, it truly misrepresents this practice and I believe we are facilitating a medical procedure with serious detrimental physical and mental health issues,” Bell wrote in his resignation letter.

Kraken cryptocurrency exchange logo seen in this illustration taken July 28, 2022. (Reuters/Dado Ruvic/Illustration)

MARKETS

Crypto exchange Kraken to halt operating in Japan

Kraken plans to stop operating in Japan at the end of January, the cryptocurrency exchange announced on Wednesday. It said it will also deregister there.

U.S.-based crypto exchange Kraken said on Wednesday it would cease its operations in Japan next month, citing the current market conditions in the country and a weak crypto market globally.

Kraken will deregister from the Financial Services Agency (JFSA) as of Jan. 31, by which time clients would have to withdraw their fiat and crypto holdings, it said in a statement.

Kraken said it is fully funded to ensure that all affected clients could withdraw their assets in a timely manner.

Last month, Kraken said it would reduce its workforce by 30%, or about 1,100 employees, as tough market conditions had crippled demand for digital assets.

Bitcoin, the pre-eminent cryptocurrency, has lost 60% of its value this year, while the wider crypto market has shrunk by $1.4 trillion, squashed by the collapse of Sam Bankman-Fried's FTX empire, Celsius and supposed 'stablecoins' terraUSD and Luna.

Cal-Maine Foods is lower in extended trading. The egg producer topped Wall Street revenue estimates but missed on profit.

Fiscal second quarter revenue rose 110% to $801.7 million, topping the estimate of $797.8 million.

Net income for the 13 weeks ended Nov. 26 was $198.6 million, up from $1.2 million in the prior year.

Diluted earnings per share were $4.07. The estimate was $4.24.

The company is closely monitoring the current outbreak of HPAI that was first detected in commercial flocks in the U.S. in February 2022. There have been no positive tests for HPAI at any Cal-Maine Foods’ owned or contracted production facility as of December 28, 2022.

The company believes the highly pathogenic avian influenza (HPAI) outbreak will continue to exert downward pressure on the overall supply of eggs, and the duration of these effects will depend in part on the timing of replenishment of the U.S. layer hen flock.

MARKETS

BlackRock's Fink talks Ukraine reconstruction with Zelenskyy

BlackRock CEO Larry Fink and Ukrainian President Volodymyr Zelenskyy held a video conference discussing their coordinated efforts in rebuilding the country

BlackRock will help coordinate the efforts of all potential investors and participants in the reconstruction of Ukraine, the government announced.

President Volodymyr Zelenskyy met virtually with BlackRock CEO Larry Fink to further preliminary agreements reached earlier this year.

During the conversation, it was emphasized that certain BlackRock leaders plan to visit Ukraine in the new year.

Gorilla Technology Group says a government agency of a Middle Eastern country developing Smart Cities intends to engage Gorilla to implement an expansive cybersecurity solution for one or more cities under development.

Gorilla is negotiating final details and expects to execute a contract and begin implementation in the first half of 2023. The anticipated project is a strong addition to the company’s 2023 revenue forecast.

The deal advances Gorilla’s strategy to become a global leader in AI based cybersecurity and video analytics while expanding their geographical footprint embracing the MENA region.

Exxon Mobil logo and stock graph seen through a magnifier in this illustration taken Sept. 4, 2022. (Reuters/Dado Ruvic/Illustration)

Oil major Exxon Mobil Corp XOM.N is suing the European Union in a bid to force it to scrap the bloc's new windfall tax on oil groups, arguing Brussels exceeded its legal authority by imposing the levy, the Financial Times reported on Wednesday.

MARKETS

Gas prices could rise back to $4 per gallon as early as May 2023, Gasbuddy says

A new projection from GasBuddy suggests that gas prices will decrease next year after record highs in 2022, but they could still hit $4 per gallon by May.

Gas prices may head back towards $4 per gallon next summer, says GasBuddy.

“The national average price of gas could cool early in the year as demand remains seasonally weak, followed by a rise that starts in late winter, bringing prices to the $4 per gallon range in time for summer. Barring unexpected challenges, prices in 2023 should return to normal seasonal fluctuations, rising in the spring, and dropping after Labor Day into the fall,” says the provider of real-time fuel prices.

The website cautioned that  areas of California like San Francisco and Los Angeles could again experience near $7 gas prices again in the summer of 2023 if refineries struggle under mandates of unique formulations of gasoline.

For sale sign outside home in Berlin, N.J., Dec. 25, 2022

Pending home sales slid for the sixth consecutive month in November, according to the National Association of Realtors. All four U.S. regions recorded month-over-month decreases, and all four regions saw year-over-year declines in transactions.

"Pending home sales recorded the second-lowest monthly reading in 20 years as interest rates, which climbed at one of the fastest paces on record this year, drastically cut into the number of contract signings to buy a home," said NAR Chief Economist Lawrence Yun. "Falling home sales and construction have hurt broader economic activity."

The Pending Home Sales Index (PHSI) — a forward-looking indicator of home sales based on contract signings — fell 4.0% to 73.9 in November. Year-over-year, pending transactions dropped by 37.8%. An index of 100 is equal to the level of contract activity in 2001.

Chao Xing tanker at the crude oil terminal Kozmino on the shore of Nakhodka Bay near the port city of Nakhodka, Russia Aug. 12, 2022. (Reuters/Tatiana Meel)

POLITICS

US emergency oil stockpiles drop to lowest level since 1983 as gas prices tick up

The nation's emergency oil stockpile managed by the Energy Department declined to its lowest level in 39 years last week as gas and oil prices increased, federal data showed.

Oil prices fell on Wednesday as concerns about an upsurge in COVID-19 cases in China, the world's top oil importer, outweighed expectations easing pandemic restrictions would lead to economic recovery and growth in demand for fuel.

Brent futures for February delivery fell 42 cents, or 0.5%, to $83.91 a barrel, by 1215 GMT. U.S. crude fell 32 cents, or 0.4%, to $79.21 per barrel.

Both benchmarks fell by over $1 per barrel earlier in the session after rising to their highest in three weeks on Tuesday on expectations of a rise in fuel demand.

“The shock in the oil price that we’ve seen today isn’t as bad as it could have been and is likely to calm down, at least partly, in the coming weeks,” said Sophie Lund-Yates, Lead Equity Analyst at Hargreaves Lansdown.

Lund-Yates expects prices to remain elevated.

“Depending on the trajectory of China’s economic expansion following the reopening of its borders and manufacturing capabilities, there could be some further spikes in the oil price coming through the pipes in the new year,” she said.

Oil refiners in the U.S. on Tuesday worked to resume operations at a dozen facilities knocked offline by freezing weather across much of the country, a recovery that in some cases will stretch into January.

The Arctic blast cut oil and gas production from North Dakota and Texas.

Reuters contributed to this report.

MicroStrategy is buying and selling bitcoin.

The provider of cloud-based services said it holds 132,500 BTC, worth about $2.2 billion.

According to a regulatory filing, MicroStrategy increased its bitcoin holdings by 2,500 bitcoins, from approximately 130,000 bitcoins as of October 31, 2022, to approximately 132,500 bitcoins as of December 27, 2022.

The approximately 132,500 bitcoins held by MicroStrategy and its subsidiaries as of December 27, 2022 were acquired at an aggregate purchase price of approximately $4.03 billion and an average purchase price of approximately $30,397 per bitcoin, inclusive of fees and expenses.

Bitcoin is trading around $16,700, meaning the company is sitting on an unrealized loss of about $1.8 billion.

Gilead Sciences logo seen in Oceanside, Calif., April 29, 2020. (Reuters/Mike Blake)

Gilead Sciences will buy all the remaining rights for an experimental cancer therapy, GS-1811, from Jounce Therapeutics for $67 million, the drugmaker said on Tuesday.

The amended licensing deal will bolster Jounce's cash resources in a challenging market for biotech companies.

Gilead will now be solely responsible for all further development and commercialization of GS-1811 globally. The amended deal is expected to reduce its 2022 earnings per share by 4 cents on both GAAP and non-GAAP basis.

GS-1811 is currently being evaluated in an early-stage trial for patients with solid tumors and works by selectively depleting T-cells that suppress the body's immune response and allow tumors to grow.

In 2020, the drugmakers had agreed to collaborate on development of GS-1811, when Gilead made an upfront payment of $85 million to Jounce. Under the initial terms, Jounce was eligible to get up to $685 million in milestone payments from Gilead, of which it has received $40 million so far.

With the amendment, Jounce will no longer receive the remaining milestone payments or any of the sales-based royalties for the therapy.

LIFESTYLE

Here are the winning numbers for Tuesday night's Mega Millions drawing

Friday's Mega Millions jackpot jumped to an estimated $640 million, with a cash prize option of $328.3 million.

There was no winner on Tuesday for the Mega Millions jackpot which has now swelled to a new high.

Pending home sale sign on a property (AP)

The National Association of Realtors will report its index of pending home sales for November.

Economists surveyed by Refinitiv are looking for a drop of 0.8%, the twelfth decline in the last 13 months as buyers struggle with surging borrowing costs and high prices. 

That would leave the index at its lowest level since June 2010 if you exclude the pandemic. 

Recall that a sale is pending when a contract to buy a previously owned home has been signed but not yet closed. 

The report follows data out Tuesday from S&P CoreLogic Case-Shiller showing that home prices fell less than expected in October, and rose 8.6% annually.

Southwest Airlines (Getty Images)

Southwest Airlines shares were another 0.5% lower in premarket trading after falling nearly 6% in the regular session.

The Senate Commerce Committee will investigate the carrier after thousands of flights were canceled over the past week, leaving travelers stranded in airports over the holidays. 

Transportation Secretary Pete Buttigieg also said Tuesday he's "made clear" to Southwest's executives that his agency will hold the airline "accountable for making things right with their customers and employees."

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FTX logo (AP)

FTX customers filed a class action lawsuit against the failed crypto exchange as the company's assets dwindle.

The filing is seeking a declaration that the company's holdings of digital assets belong to customers.

FTX was sued on Tuesday along with its former top executives including Sam Bankman-Fried.

FTX  is already feuding with liquidators in the Bahamas and Antigua as well as the bankruptcy estate of Blockfi, another failed crypto company.

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Bitcoin was trading around $16,000, after trading down over the last three days.

For the week, Bitcoin was trading lower by more than 1%.

For the month, the cryptocurrency was down more than 2% and down more than 63% year-to-date.

Ethereum was trading around $1.200, after losing 0.5% in the past week.

Dogecoin was trading at 7 cents, after losing more than 1% in the past week.

Tesla CEO Elon Musk (Getty Images/AP)

Tesla shares were 3% lower in premarket trading, after falling 11% in the regular session.

Reuters reported that Tesla was planning to run a reduced production schedule in January at its Shanghai plant sparking worries of a drop in demand in the world's biggest car market.

The stock has lost more than half its value since the start of October as investors worry that Twitter was taking much of Chief Executive Elon Musk's time while fretting about his stake sale in the electric-car maker.

The world's most valuable automaker's production cuts at the Shanghai plant come amid a rising number of COVID-19 infections in the country.

Gas prices (AAA)

The nationwide price for a gallon of gasoline bumped up on Wednesday to $3.133, according to AAA.

The average price of a gallon of gasoline on Tuesday was $3.104.

A year ago, the price for a gallon of regular gasoline was $3.284.

One week ago, a gallon of gasoline cost $3.108. A month ago, that same gallon of gasoline cost $3.546.

Gas hit an all-time high of $5.016 on June 14.

Diesel has slipped below $5.00 per gallon to $4.675, but that is still a far cry from the $3.570 of a year ago.

Oil rigs pumping (Reuters)

Oil prices traded lower on Wednesday on concerns about fuel demand recovery in China.

U.S. crude traded around $79.00 per barrel.

Brent futures traded around $84.00 a barrel.

Both benchmarks hit their highest level in three weeks on Tuesday.

China is moving toward reopening its borders next month after three years of stringent curbs on movement and businesses to counter the spread of COVID, according to Reuters.

Elsewhere U.S. output has been disrupted by an Arctic blast sending temperatures well below freezing, cutting oil and gas production from North Dakota and Texas. 

Industry group American Petroleum Institute is due to release data on U.S. crude inventories on Wednesday.