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Oil rises as Trump’s Venezuela blockade takes edge off global crude surplus concerns

NEW YORK, Dec 17 (Reuters) – rallied by more than 1% on Wednesday after U.S. President Donald Trump ordered a blockade of all under sanctions entering and leaving Venezuela, raising global political tensions and easing concerns about a swelling surplus of global crude.

futures settled at $59.68 a barrel, rising 76 cents, or 1.3%. U.S. West Texas Intermediate crude settled at $55.94 a barrel, up 67 cents, or 1.2%.

Growing U.S. fuel inventories tempered the rise in oil prices.

Prices had settled near five-year lows in the previous session on signs of progress in Russia-Ukraine peace talks. A peace agreement could see Western sanctions on Moscow eased, freeing up supply as the market grapples with fragile global demand.

On Tuesday, Trump ordered a blockade of all sanctioned oil tankers entering and leaving Venezuela, saying he regarded President Nicolas Maduro’s administration as a foreign terrorist organization. The Venezuelan government said in a statement it rejected Trump’s “grotesque threat.”

Trump made his blockade comments a week after the U.S. seized a sanctioned oil tanker off Venezuela’s coast.

QUESTIONS ABOUT HOW BLOCKADE WOULD WORK

It is unclear how many tankers will be affected and how the U.S. will impose the blockade, and whether Trump will turn to the U.S. Coast Guard to interdict vessels, as he did last week. In recent months, the U.S. has moved warships into the region.

Some energy experts are skeptical that Trump’s latest actions would make a meaningful dent in global supplies.

“While U.S. actions may inject short-term noise and modest risk premium, they are insufficient on their own to tighten global balances or drive a sustained rally in crude prices,” Kpler energy analysts said in a note.

While many vessels picking up oil in Venezuela are under sanctions, others transporting the country’s oil and crude by way of Iran and Russia have not been sanctioned. Tankers chartered by Chevron are carrying Venezuelan crude to the U.S. under an authorization previously granted by Washington.

China is the biggest buyer of Venezuelan crude, which accounts for about 1% of global supplies.

Adding further uncertainty to Venezuela’s energy production, state-run oil company PDVSA on Wednesday said it was resuming oil cargo deliveries at its terminals following a cyberattack that affected its centralized administrative systems.

At least two tankers carrying oil byproducts, including methanol and petroleum coke, departed from Venezuela’s largest port, Jose, according to ship-tracking data and internal documents from state company PDVSA.

The U.S. has not targeted exports of oil byproducts or petrochemicals since it first imposed energy sanctions on Venezuela in 2019.

RISING INVENTORIES

Rising inventories of gasoline and distillate in the U.S. took some of the steam out of crude oil’s rise. While crude inventories fell last week, those of gasoline and distillate grew more than analysts expected, according to the U.S. Energy Information Administration.

Crude inventories dropped by 1.3 million barrels to 424.4 million barrels in the week ended December 12, the EIA said, compared with analysts’ expectations in a Reuters poll for a draw of 1.1 million barrels.

U.S. gasoline stocks, meanwhile, added 4.8 million barrels in the week to 225.6 million barrels, the EIA said, compared with analysts’ expectations in a Reuters poll for a build of 2.1 million barrels.

Distillate stockpiles, which include diesel and heating oil, rose by 1.7 million barrels in the week to 118.5 million barrels, versus expectations for a rise of 1.2 million barrels, the EIA data showed.

(Reporting by Laila Kearney in New York and Ahmad Ghaddar in London. Additional reporting by Robert Harvey in London, Jeslyn Lerh and Siyi Liu in Singapore, Katya Golubkova and Yuka Obayashi in Tokyo;Editing by Mark Potter, Frances Kerry, Paul Simao, Rod Nickel)

(Additional reporting by Robert Harvey in London, Jeslyn Lerh and Siyi Liu in Singapore, Katya Golubkova and Yuka Obayashi in Tokyo. Editing by Louise Heavens and Mark Potter)

 

Warner Bros Discovery board rejects rival bid from Paramount

Summary

  • Warner Bros board rejected ‘s $108.4 billion offer
  • Directors cited inadequate and risky financing assurances
  • Board said Netflix’s $27.75-per-share merger is superior
  • Paramount’s debt load and creditworthiness raised concerns

LOS ANGELES, Dec 17 (Reuters) – Warner Bros Discovery’s board rejected Paramount Skydance’s $108.4 billion hostile bid on Wednesday, saying it failed to provide adequate financing assurances.

In a letter to shareholders, disclosed in a regulatory filing, the board wrote that Paramount had “consistently misled” Warner Bros shareholders that its $30-per-share cash offer was fully guaranteed, or “backstopped,” by the Ellison family, led by billionaire and Oracle CEO Larry Ellison.

“It does not, and never has,” the board wrote of the guarantee of Paramount’s offer, noting that the offer posed “numerous, significant risks.”

The board said it found Paramount’s offer “inferior” to the merger agreement with Netflix’s. Netflix’s $27.75 per share offer for Warner Bros’ film and television studios, its library and the HBO Max streaming service is a binding agreement that requires no equity financing and has robust debt commitments, the board wrote.

Warner Bros has not yet set a date for a shareholder vote on the deal but it is expected to happen sometime in spring or early summer, its Chairman Samuel Di Piazza said in an interview with CNBC.

NETFLIX WELCOMES MOVE

Paramount did not immediately respond to a Reuters request for comment, while Netflix welcomed the move.

“The Warner Bros Discovery Board reinforced that Netflix’s merger agreement is superior and that our acquisition is in the best interest of stockholders,” its co-CEO Ted Sarandos, said in a statement.

Netflix was already engaging with the U.S. Department of Justice and the European Commission, its other co-CEO Greg Peters told CNBC, while expressing confidence that the regulators would view the deal as pro-consumer and pro-growth.

Warner Bros shares were down 1.4% at $28.5 in premarket trading, while Netflix gained 1.5% and Paramount fell 1.8%.

Paramount last week took its case directly to Warner Bros shareholders, arguing it has arranged “air-tight financing” to support its bid, with $41 billion in new equity assured by the Ellison family and RedBird Capital, and $54 billion of debt commitments from Bank of America, Citi and Apollo.

Warner Bros board countered on Wednesday that Paramount’s most recent offer includes an equity commitment “for which there is no Ellison family commitment of any kind,” but rather the backing of “an unknown and opaque” Lawrence J. Ellison Revocable Trust, whose assets and liabilities are not publicly disclosed and are subject to change.

“Despite having been told repeatedly by WBD how important a full and unconditional financing commitment from the Ellison family was…the Ellison family has chosen not to backstop the PSKY offer,” the Warner Bros board wrote. “A revocable trust is no replacement for a secured commitment by a controlling shareholder.”

WARNER BROS QUESTIONS PARAMOUNT’S CREDITWORTHINESS

Paramount has submitted a total of six bids to acquire the entire Warner Bros studio, including its television networks, including CNN and TNT Sports.

It has previously said the Ellison family trust – which Paramount says contains more than $250 billion in assets including about 1.16 billion shares of Oracle – is more than adequate to cover the equity commitment.

“To suggest that we are not ‘good for the money’ (or might commit fraud to try to escape our obligations), as certain reports have speculated, is absurd,” Paramount wrote in a letter to Warner Bros’ shareholders last week. Its debt commitments are not conditioned on Paramount’s financial condition, it wrote.

Warner Bros, however, pointed in the filing on Wednesday to what it described as structural risks in Paramount’s proposed financing, and also raised questions about Paramount’s financial condition and creditworthiness.

The offer relied on a seven-party, cross-conditional structure, with the Ellison Revocable Trust providing just 32% of the required equity commitment while capping its liability at $2.8 billion, Warner Bros said. It noted that the trust’s assets could be withdrawn at any time.

DEBT LEVELS AFTER DEAL WITH PARAMOUNT WILL BE RISKY

Netflix’s offer is backed by a public company with a market cap in excess of $400 billion with an investment grade balance sheet, the Warner board noted.

The company has told Warner Bros it would keep releasing the studio’s films in cinemas in a bid to ease fears that its deal would eliminate another studio and major source of theatrical films, according to familiar with the matter.

Paramount, in contrast, has a $15 billion market capitalization and a credit rating “a notch above ‘junk,’ Warner Bros noted on Wednesday. Should the deal close, Paramount would have a debt ratio of 6.8 times its operating income “with virtually no current free cash flow.”

The bidder would also impose what Warner Bros said would be “onerous operating restrictions” on the company, during the potentially lengthy period between signing and closing, including limits on new content licensing deals.

Paramount’s plans to achieve $9 billion in “synergies” across the two studios was described as “ambitious” from an operational standpoint, the Warner Bros board noted, and would represent a new round of job losses that “would make Hollywood weaker, not stronger.”

Warner Bros Discovery’s board dismissed Paramount’s charges of unfairness – that had been set forth in a filing by Paramount last week – saying it held “dozens” of calls and meetings with the studio’s principals and advisors, including four in-person meetings and meals with CEO David Zaslav and Paramount CEO David Ellison, or his father, Larry Ellison.

“After each bid, we informed PSKY of the material deficiencies and offered potential solutions,” the Warner Bros board wrote. “Despite this feedback, PSKY has never submitted a proposal that is superior to the agreement.”

Paramount said it has already applied for regulatory approval in the U.S., and has alerted European regulators, shortening the path to regulatory approval.

Warner Bros’ board wrote it considered the regulatory risks in evaluating the Netflix and Paramount offers, and believes that either transaction would obtain the necessary U.S. and foreign regulatory approvals.

Netflix also offered a $5.8 billion break-up fee that was higher than Paramount’s $5 billion break-up fee.

The Warner Bros board also described the Paramount offer as “illusory,” adding it could be terminated or amended at any time prior to the deal’s completion, which is not the same as a binding merger agreement.

“The PSKY offer provides an untenable degree of risk and potential downside for WBD shareholders,” the board wrote.

(Dawn Chmielewski reported from Los Angeles, Milana Vinn reported from New York, additional reporting by Aditya Soni; Editing by Sayantani Ghosh, Raju Gopalakrishnan and Arun Koyyur)

 

Developer breaks ground on $500M mixed-use project in Henrico

A $500 million mixed-use development is coming to Financial’s former campus in County, its developer announced Tuesday.

The project, known as Midtown64, rests on a 46-acre site at the intersection of West Broad Street and Interstate 64. It will include up to 130,000 square feet of retail, restaurant and entertainment space — anchored by a grocery store and a new-to-market fitness concept. It will also have up to 300,000 square feet of Class A office space, nearly 1,000 apartments, 194 townhomes built by Lennar and a 226-room hotel.

“Breaking ground on Midtown64 is an exciting milestone that brings to life our vision to create a first-class, mixed-use destination to serve and the greater region,” Eric Walter, president of Maryland-based developer , said in a statement. “We look forward to our continued partnership with the local community to deliver a vibrant, standout project for all to enjoy.”

A spokesperson said Greenberg Gibbons purchased the property from Genworth within the past week, with the acquisition cost included in the company’s $500 million investment. More information on the project, including specific company brands, was not immediately provided.

In a statement, Henrico County Board of Supervisors Chair Daniel J. Schmitt said Midtown64 “will energize the area, generate opportunities for businesses and residents and showcase Henrico’s vision for a vibrant, inclusive community where growth and opportunity thrive.”

Richmond-based hotel operator Shamin Hotels is a joint-venture partner with Gibbons in the project.

“We’re excited to partner with Greenberg Gibbons on another first-class project,” Neil Amin, CEO of Shamin Hotels, said in a statement. “Having our hotel within this dynamic destination will be very attractive to both and leisure travelers in the area.”

Construction will proceed in phases, with the first phase including retail, 130,000 square feet of office space, multifamily residences, townhomes and the hotel. The first phase is expected to be completed in 2028.

Based in Baltimore, Greenberg Gibbons is a major developer, investor, owner and operator of mixed-use, retail, commercial and residential properties. Its portfolio includes more than 6.7 million square feet and $1.6 billion in assets, with more than 55 projects across eight states.

Wall St ends mixed after paring earlier losses

Summary

  • closed higher while the S&P 500 and Dow finished lower
  • November jobs data showed modest gains as unemployment rose to 4.6%
  • Investors priced in deeper Fed rate cuts for next year
  • Energy and health stocks dragged markets as crude hit 2021 lows

Dec 16 (Reuters) – ‘s main indexes pared some losses on Tuesday afternoon with the Nasdaq closing up, and the S&P 500 and the Dow closing lower, impacted by declines in healthcare and energy stocks. Investors evaluated delayed economic data to gauge the ‘s monetary policy outlook for next year.

A Labor Department report showed nonfarm payrolls increased by 64,000 jobs in November following a decline in October because of government spending cuts. But the rose to 4.6% in November against the backdrop of economic uncertainty stemming from President Donald Trump’s aggressive trade policy.

A separate report on Tuesday showed retail sales were flat in October, just below an estimate of economists polled by Reuters calling for a rise of 0.1%. Analysts flagged the likelihood of the figures being distorted by slow data collection due to a recent government shutdown.

“This is all fairly old news at this point. Most data points are being viewed in the lens of what they are going to do to the Fed, and the data you got today isn’t likely to move the needle,” said Mark Hackett, chief market strategist at Nationwide.

After Tuesday’s data, investors are pricing in interest rate cuts of at least 58 basis points next year — more than double the 25 bps signaled by the Fed last week.

Trump is set to interview Fed Governor Christopher Waller on Wednesday for the Federal Reserve chair position, the Wall Street Journal reported Tuesday afternoon.

According to preliminary data, the S&P 500 lost 16.42 points, or 0.24%, to end at 6,800.09 points, while the Nasdaq Composite gained 54.05 points, or 0.23%, to 23,111.46. The Dow Jones Industrial Average fell 302.67 points, or 0.63%, to 48,113.89.

Crude prices hit their lowest level since 2021.

“The crude move today is the one that stands out. Everything else seems like lethargy among investors and just a modest technical move to the sidelines,” Hackett said.

In health stocks, Pfizer fell after the drugmaker forecast a challenging 2026 due to weaker sales of COVID-19 products and squeezed margins. Humana slipped after the health insurer announced undefined leadership changes.

The S&P 500 and the Nasdaq hovered near their three-week lows as persistent uncertainty over rate cuts and concerns about lofty tech valuations continued to weigh on market sentiment.

Among other stocks, B. Riley jumped after the investment bank reported a profit for the second quarter, compared with a year-ago loss in an overdue quarterly filing.

Comcast rose after CNBC financial journalist David Faber speculated about potential involvement by an activist investor.

Separately, a Reuters report said Nasdaq submitted paperwork with the U.S. Securities and Exchange Commission to roll out round-the-clock trading of stocks, months after the New York Stock Exchange and Cboe Global Markets announced similar plans.

(Reporting by Abigail Summerville in New York and Johann M Cherian and Shashwat Chauhan in Bengaluru; Editing by Shilpi Majumdar and Matthew Lewis)

 

Longtime SCC banking commissioner to retire

After nearly three decades under the same leadership, the Virginia ‘s Bureau of Financial Institutions will soon have a new commissioner.

The announced Tuesday that Joseph Face Jr. will retire in January 2026 after serving since 1997 as the state’s commissioner of the Bureau of Financial Institutions, with regulatory authority over state-chartered banks and in Virginia.

Dustin Physioc will soon become commissioner of financial institutions for the Virginia State Corporation Commission. Photo courtesy State Corporation Commission
Dustin Physioc will soon become commissioner of financial institutions for the Virginia State Corporation Commission. Photo courtesy State Corporation Commission

Dustin Physioc, who has almost two decades of experience with the SCC’s Bureau of Financial Institutions, will succeed Face, effective Jan. 25.

The bureau administers state laws applicable to depository and nondepository financial institutions, including state-chartered banks, saving institutions and credit unions. It also handles consumer complaints related to those entities.

Face’s career with the SCC dates back to 1979, when he began work as an examiner. He later became deputy commissioner of financial institutions in 1993. During his time with the SCC, he has also represented state regulators in numerous groups, committees and coalitions

“Joe Face’s steady leadership over the last three decades has been of incalculable value to both consumers and the regulated community,” Commission Chair Samuel T. Towell said in a statement. “Virginia is fortunate to have in Dustin Physioc someone with the experience and demeanor to build on that strong foundation.”

Physioc joined the SCC in 2006 as a financial analyst in the bureau’s licensing division and later held various licensing positions before being appointed deputy commissioner for administration and licensing in 2018. He also led the bureau’s strategic planning and budget programs.

Physioc has bachelor’s degrees in economics and political science from Virginia Tech. He is also a graduate of the Virginia Executive Institute, the L. Douglas Wilder School of Government and Public Affairs at Virginia Commonwealth University and the Virginia Bankers School of Bank Management.

According to the SCC, the bureau regulates more than 26,000 financial institutions, licensees and registrants controlling some $150 billion in assets.

PayPal applies to form its own bank to expand small-business lending

Summary

  • applied for a charter in Utah and with the
  • A charter would allow insured savings accounts and expanded lending
  • The move aligns with eased banking rules under Trump’s administration
  • Consumers have been wary of PayPal balances lacking federal insurance

PayPal is seeking a that would allow it to boost its lending , offer savings accounts that can earn interest and make customers’ deposits eligible for federal insurance coverage, the payments company said Monday.

PayPal has submitted applications to authorities in Utah and to the Federal Deposit Insurance Corporation to set up PayPal Bank, the online payments company said in a news release.

The banking option would also allow PayPal to expand loans to small businesses and rely less on third parties, it said. PayPal has provided $30 billion in loans to more than 420,000 businesses worldwide since 2013, according to the company.

If PayPal’s applications are approved, the company will join other entities that have not been traditionally seen as banks in receiving banking charters, such as the digital asset firms that have recently received preliminary approval from the federal government. The trend reflects the broader push from President Donald Trump’s second administration to ease banking rules.

The company plans to name Mara McNeill as the first president of the bank. McNeill previously served as the chief executive of Toyota Financial Savings Bank, a subsidiary of the Toyota Motor Corporation.

PayPal was created in 2000 after a payments company co-founded by Elon Musk merged with software company Confinity, whose founders included Trump supporter and tech mogul Peter Thiel. The company has since become a global household name that enables millions of transactions daily. It reported a net revenue of $8.4 billion in the most recent quarter.

But consumers have been wary of storing large amounts of money on the platform or others like it, such as the PayPal-owned Venmo, because the money is not insured by the federal government.

The ‘s Office of the Comptroller of the Currency, a major U.S. financial regulator, last week approved preliminary banking charters for digital asset platforms Circle, BitGo, Fidelity, Paxos and Ripple.

The OCC said that it had “applied the same rigorous review and standards it applies to all charter applications,” while Comptroller Jonathan V. Gould said the approvals would help make the banking industry more competitive by providing consumers with more access to new products, services and sources of credit.

According to the regulator, the public comments it received during the review process raised concerns about “unsavory actors” gaining access to the banking system if digital assets firms were allowed to be banks.

Other companies that have not been traditional players in the banking industry but have submitted applications for charters include Sony and Nissan.

Rod Garratt, a former vice president at the Bank of New York from 2013 to 2015, said permitting crypto and payment companies to have banking charters does “raise concerns about bringing more firms under federal banking regulation and increasing Fed exposure.”

But he said such risks could be mitigated by removing some of the benefits offered to traditional banks. Garratt noted that the Fed could, for instance, provide access to payment settlements but not offer certain lines of credit usually given to banks, referring to remarks by Federal Reserve Gov. Christopher Waller in October.

 

 

Incoming Kraft Heinz CEO says he endorses split, reserves right to improve it

NEW YORK, Dec 16 (Reuters) – Incoming CEO , who previously led cereal maker , said in an interview with Reuters that he endorses the company’s split into two companies and “reserves the right” to improve the plans.

“I’m looking forward to executing it, I think it’s absolutely the right thing to do,” Cahillane said, adding he thinks it will add value to both the condiments and spreads , which includes Heinz ketchup, and the grocery division covering staples like Velveeta cheese.

Cahillane, who oversaw the split-up of Kellogg’s snacks and cereals businesses, added, “We reserve the right to improve upon the plans, make them better, by studying it and having the discussions with all involved.”

“If there’s any changes, we’ll be very transparent about that,” he added.

Some analysts and investors have questioned how Kraft Heinz’s stable of brands was split up between the two companies. For example, Kraft macaroni and cheese, which has seen its market share slip, is included in the condiments unit, which is projected to be faster growing.

Kraft Heinz announced on Tuesday that Cahillane would join the company on January 1, with current CEO Carlos Abrams-Rivera moving into an adviser role until March 6.

(Reporting by Jessica DiNapoli in New York, editing by Deepa Babington)

 

Unemployment rate rises, signaling weakness in the economy

Summary

  • climbed to 4.6%, the highest since 2021
  • Job losses in October tied largely to federal worker departures
  • slowed to 3.5% as pressures persist
  • Health care and construction added jobs, while federal payrolls fell

The economy is flashing new warning signs, as the shed jobs over October and November, and the unemployment rate ticked up to 4.6 percent, the highest level since 2021.

Job gains of 64,000 in November exceeded expectations but only partially offset the loss of 105,000 jobs in October. Those losses, the sharpest since the covid pandemic-era recession, reflected the exit of tens of thousands of federal workers who took a deferred resignation package earlier this year.

The long-awaited by the Labor Department was delayed because of the federal government shutdown, creating headaches for economists and policymakers trying to assess how fast the labor market slowed this fall, as President Donald Trump’s economic policies, including higher tariffs and immigration enforcement, continue to take hold.

Meanwhile, wage growth cooled significantly in November, reflecting new strain on U.S. households as inflation remains elevated. Average hourly wages have risen by 3.5 percent over the past 12 months, to $36.86 an hour.Ask The Post AIDive deeper

Also, job creation in August was revised down by 22,000, showing the economy shed 26,000 jobs that month. September job gains were also revised lower by 11,000 to 108,000.

“Today’s report showed overall stagnant growth,” said Nicole Bachaud, labor economist at ZipRecruiter. “This really points to the challenges in the policy landscape that businesses are going up against, tariffs, geopolitical uncertainty, inflation that’s staying really stubborn.”

The unemployment rate has risen this year, from 4 percent in January to 4.6 percent in November, as more Americans, some of whom are reentering the labor market, struggle to find opportunities. The unemployment rate rose sharply for African Americans and teenagers. Rising unemployment for those groups often serves as a bellwether for a broader economic downturn.

“The fact that the unemployment rate has gone up [so much] adds to the realization of what we’re seeing in consumer attitudes that even as the economy grows, most Americans don’t feel very good about it,” said Diane Swonk, chief economist with the tax and accounting firm KPMG.

The report does not contain the unemployment rate for October because the government could not collect survey data during the shutdown, a first for the agency since the survey began in 1948.

The highlighted the bright spots in the jobs report. “THE BEST IS YET TO COME!” the White House posted on social media, highlighting growth in the private sector, the shrinking of the federal government and jobs going to “Americans, not illegals.”Ask The Post AIDive deeper

Some economists have noted that there is little evidence that U.S.-born workers are picking up jobs abandoned by immigrants who have left the country.

appeared to mostly brush aside the jobs data as stale news, with major stock indexes wavering midmorning between minor gains and losses.

Health care continued to lead jobs gains in November, adding 46,000 positions. Construction payrolls grew by 28,000 jobs and social assistance added 18,000 positions. But transportation and warehousing and federal government payrolls lost jobs in November.

Since January, the federal government has lost 271,000 jobs, with more than half of those losses registered in October.

The manufacturing sector also shrank in November under the weight of tariffs and has lost jobs most months this year, even as the Trump administration argues that its trade war will revive American manufacturing. Leisure and hospitality, which has helped buoy the labor market this year, shed positions, as consumers have pulled back on discretionary spending.

The labor market has been softening since June, with hiring sputtering to near the lowest level in more than a decade and the unemployment rate rising. Headwinds including tariffs, inflation and cautious consumer spending have prompted employers to suspend hiring. Meanwhile, some white-collar employers have laid off employees or announced cuts this fall, especially amid the growth of artificial intelligence, which employers can use to replace jobs. Still, filings for unemployment insurance, the closest to a real-time gauge for layoffs in the broader economy, remain low, although they ticked up last Thursday.

“Businesses need certainty when they go and make their hiring decisions and their investment plans, and when there’s uncertainty in the economy, it just makes things harder,” said Sam Kuhn, an economist with the recruitment software company Appcast.

The report buttressed the ‘s decision to cut last week, for the third time this year, because of a softening labor market. Federal Reserve Chair Jerome H. Powell warned that official statistics could be overstating job creation by 60,000 jobs a month, calling jobs data “a complicated, unusual and difficult situation.”

But so few are entering the labor market, in part because of the Trump administration’s immigration enforcement, that the economy no longer needs to pump out hundreds of thousands of jobs a month to keep the unemployment rate steady. Economists say it’s possible that creating around 50,000 jobs a month could keep the unemployment rate stable.

“The unemployment rate would be much higher right now without the absence of immigrants that we’re seeing and the loss of participation of older workers retiring,” said Swonk, the KPMG economist.

A number of high-profile layoffs this fall have fueled unease about the state of the labor market. The rate of layoffs rose substantially in October, a separate jobs report released by the Labor Department on Monday showed. But preliminary estimates from the Cleveland Federal Reserve show that around 20,000 Americans in 16 states received layoff notices in November through the Warn Act, a significant decrease from about 36,000 reported in October for the same states.

In another sign of labor market fragility, the number of Americans working part-time who would prefer full-time work surged by more than 900,000 from September to November.

And the number of Americans who have been unemployed for less than five weeks jumped to 2.5 million in November, the highest level since 2020.

“If you’re a worker that just freshly got laid off or are looking for new work, there’s not a lot of companies hiring right now,” Kuhn said.

– – –

Andrew Ackerman contributed to this report.

 

Roomba maker iRobot files for bankruptcy protection; will be taken private under restructuring

Roomba maker iRobot has filed for Chapter 11 bankruptcy protection, but says that it doesn’t expect any disruptions to devices as the more than 30-year-old company is taken private under a restructuring process.

IRobot, which became well known for its robotic vacuums, has struggled of late, dealing with increased competition, layoffs and a declining stock price. In 2022 Amazon announced that it had agreed to buy iRobot for about $1.7 billion, but that deal was called off last year. Amazon blamed “undue and disproportionate regulatory hurdles” after the European Union signaled its objection to the transaction.

Amazon said at the time that it would pay iRobot a previously agreed termination fee of $94 million and iRobot said that it would undergo a restructuring to help stabilize the company.

iRobot said Sunday that it is now being acquired by Picea through a court-supervised process. Picea, or Shenzhen PICEA Robotics Co., Ltd., is iRobot’s primary contract manufacturer.. With facilities in China and Vietnam, Picea has built and sold more than 20 million robotic vacuum cleaners.

“The transaction will strengthen our financial position and will help deliver continuity for our consumers, customers, and partners,” iRobot CEO Gary Cohen said in a statement.

iRobot said it will continue to operate as normal during the Chapter 11 process and doesn’t expect any disruption to its app functionality, customer programs, global partners, supply chain relationships, or ongoing product support.

The Bedford, Massachusetts-based anticipates completing the prepackaged chapter 11 process by February.

In premarket trading, iRobot shares slid nearly 70% to $1.31.

Ford retreats from EVs, takes $19.5 billion charge as Trump policies take hold

Dec 15 (Reuters) – Ford Motor said on Monday it will take a $19.5 billion writedown and is killing several electric-vehicle models, in the most dramatic example yet of the auto industry’s retreat from battery-powered models in response to the ‘s policies and weakening EV demand.

The Dearborn, Michigan-based company said it will stop making the F-150 Lightning in its electric vehicle form, but will pivot to producing an extended-range electric model, a version of a hybrid vehicle called an EREV, which uses a gas-powered generator to recharge the battery. The company is also scrapping a next-generation electric truck, codenamed the T3, as well as planned electric commercial vans.

Instead, Ford said it will pivot hard into gas and hybrid models, and eventually hire thousands of workers, even though there will be some layoffs at a jointly owned Tennessee battery plant in the near term. The company expects its global mix of hybrids, extended-range EVs and pure EVs to reach 50% by 2030, from 17% today.

Ford will spread out the writedown, taken primarily in the fourth quarter and continuing through next year and into 2027, the company said. About $8.5 billion is related to cancelling planned EV models. Around $6 billion is tied to the dissolution of a battery joint venture with South Korea’s SK On, and $5 billion on what Ford called “program-related expenses.”

The automaker also raised its 2025 guidance for adjusted earnings before taxes and interest, to about $7 billion, up from a previous range of $6 billion to $6.5 billion.

Ford’s shift reflects the auto industry’s response to waning demand for battery-powered models, after car companies plowed hundreds of billions of dollars into EV investments early this decade. The outlook for electrics dimmed significantly this year as U.S. President Donald Trump’s policies yanked federal support for EVs and eased tailpipe-emissions rules, which could encourage carmakers to sell more gas-powered cars.

U.S. sales of electric vehicles fell about 40% in November, following the September 30 expiration of a $7,500 consumer tax credit, which had been in place for more than 15 years to stoke demand. The Trump administration also included in the massive tax and spending bill that passed in July a freeze on fines that automakers pay for violating fuel-economy regulations.

“Rather than spending billions more on large EVs that now have no path to profitability, we are allocating that money into higher-returning areas,” said Andrew Frick, head of Ford’s gas and electric-vehicle operations.

The F-150 Lightning rolled off assembly lines starting in 2022 with much fanfare – comedian Jimmy Fallon wrote a song about the truck. Ford increased production of the model to meet an influx of 200,000 orders, but sales haven’t kept pace. The company sold 25,583 Lightnings through November of this year, a 10% decrease from the prior-year period.

The successor to the F-150 Lightning, the T3 truck, was supposed to be built ground-up for production at a new complex in Tennessee, and be a core part of Ford’s second-generation EV lineup. Ford is now replacing production of the EV pickup with new gas-powered trucks starting in 2029 at the Tennessee factory.

Ford effectively killed the entirety of its announced second-generation of EV models with Monday’s announcement. For its future EV lineup, the company is shifting focus to more affordable EV models, conceived by a so-called skunkworks team in California. The first model from that team is slated to be priced at about $30,000 and go on sale in 2027. This midsize EV truck is being built at Ford’s Louisville plant.

 

(Editing by Mike Colias; Editing by Lisa Shumaker)