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By Chibuike Oguh

NEW YORK (Reuters) – Shares of electric-vehicle startup Fisker Inc rose by more than 20% on Tuesday after the company reaffirmed its plan to increase deliveries of its flagship Ocean sports utility vehicle, and a bullish Wall Street analyst report.

The EV maker said it had built 5,000 Ocean SUVs and expects to ramp up deliveries to 300 units per day later this year, reiterating a plan announced earlier this month by Chief Executive Henrik Fisker.

Fisker’s shares rose as high as $6.47, and were on course for their biggest daily percentage gain since April. The stock, however, is down about 12% this year and is a fraction of its all-time intraday high of around $32 reached in March 2021 during a pandemic boom.

Fisker is a “pure-play EV force” that offers investors “exposure to the rapidly growing EV market” given its “lower risk business model” compared to its peers, said Bank of America analysts, led by John Babcock, as the bank reinstated coverage of the company with a “buy” rating.

“The automotive industry is undergoing a once-in-a-century revolution with technology advancement on electrification, autonomy, and digitization,” the analysts said. “These key mega-trends are creating significant growth opportunities for OEMs (other equipment manufacturers) and suppliers alike that we expect to persist for the next decade plus,” they added.

California-based Fisker has so far delivered about 900 vehicles in the U.S. and Europe. Unlike other EV makers, Fisker has outsourced its vehicle production to Canadian auto part supplier Magna International.

(Reporting by Chibuike Oguh in New York; Editing by Lance Tupper and Deepa Babington)

By Tim Hepher

PARIS (Reuters) -Airbus confirmed the appointment of sales chief Christian Scherer as CEO of its core planemaking operation on Tuesday, restoring dedicated leadership of its main business for the first time in four years as it steps up jet production.

The world’s largest planemaker said the move would free group CEO Guillaume Faury, who has combined the job of running the wider company with the jetliner business since 2019, to steer the group in a “fast-evolving global environment”.

Scherer’s appointment as Commercial Aircraft CEO, first reported by Reuters, will take effect from Jan. 1 after discussions with unions, Airbus said.

The shake-up propels a career-long insider to effective number two of Europe’s largest aerospace group, allowing Faury to focus on its wider portfolio amid uncertainties over its future in space and the pace of development of a new fighter.

The appointment of Scherer, 61, heralds broad continuity inside the main commercial arm, which competes with Boeing and makes up about 70% of the company’s revenues.

It comes at a time when the aerospace industry faces widespread disruption in the global supply chain.

Airbus shares rose 1% in a slightly weaker market.

Scherer, who is currently chief commercial officer and former head of planemaking strategy, said he would devote himself and his team to “meet our operational objectives…and prepare the future of our products and services”.

Airbus has said it plans to deliver 720 jets this year and raise benchmark single-aisle jet output by about 50% to 75 planes a month by 2026. The company is wrestling with supply chain problems but has sped up deliveries since the summer.

The shake-up leaves room for some renewal of operational leadership amid approaching retirements, sources said.

‘NOT EADS’

Airbus formally merged with its dominant planemaking business in 2018, meaning it combines two separate headquarters and operational functions under one CEO, with the Helicopters and Defence & Space divisions sitting underneath.

The shake-up brings back a separate planemaking CEO under the same roof but the company does not appear to be re-creating two entities, something that had created a stage for chronic in-fighting in the past. Airbus insists that era is over.

Asked whether Commercial Aircraft would report profit separately, a spokesperson said: “We cannot share more details about the ‘to-be’ structure at this stage and we will be working with our social partners throughout the process.”

People familiar with the group’s history said the shake-up reflected a cautious compromise between reinstating a separate management and recreating a holding structure reminiscent of former parent EADS, the stage for past share market turbulence.

“Nobody wants to recreate EADS,” one of the people said.

Faury said in a statement he and Scherer already worked “hand in hand” and that the existing combination of parent group and planemaking business had allowed “alignment and speed of execution during a period of multiple crises and change”.

Scherer’s immediate priorities will include tackling a production and quality crisis at engine maker Pratt & Whitney, while longer-term product decisions are in store in coming years for an A220 upgrade and eventual A320 successor.

His place at the head of the sales operation is likely to be taken by contracts head Benoit de Saint-Exupery, insiders said.

Although Faury is widely expected to remain a somewhat hands-on CEO, Jefferies analyst Chloe Lemarie said several topics would benefit from the split of his two roles including supply chains and the Franco-German FCAS/SCAF fighter programme.

(Reporting by Tim HepherEditing by Mark Potter and Ros Russell)

(Reuters) – U.S. new-vehicle sales are set to rise in September from a year ago, helped by sustained demand, according to Cox Automotive.

Sales volumes in the current month are set to touch nearly 1.3 million units, up more than 13% from a year ago, according to the auto research firm.

Despite rising interest rates on new vehicle loans and a strike by the United Auto Workers (UAW) union against major U.S. automakers, industry-wide inventory levels are up more than 63%, the report said.

The ongoing labor strike between the UAW and automakers Ford, General Motors and Chrysler parent Stellantis, targeting some U.S. facilities at each company, has threatened the supply of newer models.

“Pent-up demand has been fueling the vehicle market this year. Consumers, and even more so large fleets, have become buyers as inventory improves,” said Charlie Chesbrough, Cox Automotive senior economist.

The auto research firm also raised full-year new-vehicle sales forecast to between 15.3 million and 15.4 million units, from 15 million units.

(Reporting by Aishwarya Jain; Editing by Maju Samuel)

(This Sept. 24 story has been corrected to show that Lego has abandoned one specific oil-free brick development project, not all such efforts, in the headline and paragraph 1)

(Reuters) – Danish Toymaker Lego has abandoned its most high-profile effort to ditch oil-based plastics from its bricks after finding that its new material led to higher carbon emissions, the Financial Times reported on Sunday.

Lego found that bricks made from recycled polyethylene terephthalate (RPET), would lead to higher carbon emissions.

“We tested hundreds and hundreds of materials. It’s just not been possible to find a material like that,” Lego Chief Executive Niels Christiansen told the Financial times.

A Lego spokesperson told Reuters that testing and development continued and that the company aimed to make the toys from sustainable materials by 2032.

The company had kicked off efforts in 2020 to replace its plastic bricks by sustainable materials. The difficulty was to find a material that would be environment friendly but give the same colour, shine and sound of an oil-based plastic bricks.

(Reporting by Shubhendu Deshmukh in Bengaluru; Editing by Lisa Shumaker)

By Sinead Cruise and Elizabeth Howcroft

LONDON (Reuters) -Goldman Sachs and HSBC are among a group of five banks adopting a common global approach to disclosing clients’ stock positions, a move which participants say could help cut costs and bolster transparency.

The group, which also includes Barclays, BNP Paribas and one other bank, is working on a tool to minimise the risks of under-reporting, particularly when investors make so-called short bets or build stakes using derivatives, two sources told Reuters.

Regulators require investors to report the securities they hold when certain thresholds are breached, which requires complex, time-consuming analysis of the rules. If there is room for interpretation, this can lead to missteps and penalties.

Banks have been investing in so-called RegTech to cut the costs of complying with such rules through automation.

Now the group of five banks, working with RegTech specialist Droit, is looking to streamline efforts and further lower costs.

Goldman Sachs Global Head of Position Regulatory Reporting, Pete Chisholm, told Reuters that the initiative, called Endoxa, is the first bank-led consortium to tackle global rules on disclosures reporting,

“This is about whether all the banks across the world understand the rules exactly the same,” Chisholm said, adding there was “a risk that the market data the public relies on could be inaccurate because of the lack of commonality”.

BNP Paribas Global Head of Financial Markets Compliance Kara Lemont said in a statement the scheme should reassure regulators and legislators that rules were being applied consistently.

Spokespeople for Barclays and HSBC said the banks are participating in the consortium, but declined further comment.

The banks will work with Droit and a law firm to write a common digital machine-readable code that consortium members can implement to ensure consistent compliance, said one source, who declined to be named.

Endoxa members hope other banks will join over time, further harmonising how reporting rules are applied, Chisholm said.

“Retail investors expect that every bank making these disclosures is doing so on the same basis. This is a way of ensuring everyone plays by the same rules,” he said.

STAKE SURPRISES

Investors have in some recent cases amassed large stakes in publicly-traded companies that, while within the rules, have taken other market participants by surprise.

Although Endoxa’s members remain free to help clients to build positions confidentially, the consortium will work with lawyers and regulators to agree a precise interpretation of the rules around disclosures, the second source told Reuters.

“We believe this partnership can be extended to many issues the industry is facing. This will ultimately reduce risk and make organisations safer,” said Droit founder and Chief Executive Brock Arnason.

However, Mayra Rodriguez Valladares, a financial risk consultant at MRV Associates who trains bankers and regulators, said it may be inappropriate for banks to club together to decide how to interpret rules, adding that regulators should look closely at such moves.

(Reporting by Sinead Cruise, additional reporting by Elizabeth Howcroft, editing by Alexander Smith)

By Lewis Krauskopf, Ankika Biswas and Shashwat Chauhan

(Reuters) – Wall Street’s main indexes posted gains on Monday, with increases in Amazon.com shares and the energy sector, as Treasury yields rose further and investors looked to economic data and Federal Reserve policymakers’ remarks later in the week for clarity on the path for interest rates.

Investors are grappling with the rise in benchmark Treasury yields to 16-year highs after the Fed gave a hawkish longer-term rate outlook. The S&P 500 rebounded on Monday after last week it had its biggest weekly drop since March.

There is a “tug of war between investors seemingly getting more concerned about ‘higher for longer’ … and bulls wondering maybe we have seen the correction and we can start to build from these levels higher,” said Chuck Carlson, chief executive officer at Horizon Investment Services.

The Dow Jones Industrial Average rose 43.04 points, or 0.13%, to 34,006.88; the S&P 500 gained 17.38 points, or 0.40%, at 4,337.44; and the Nasdaq Composite added 59.51 points, or 0.45%, at 13,271.32.

Among S&P 500 sectors, energy led the way, rising 1.3%, while materials gained 0.8%. Defensive sectors lagged, with the consumer staples group dropping 0.4%.

With the end of the third quarter drawing near, investors said market moves may be relatively muted until companies report quarterly results in the coming weeks.

The S&P 500 has slid about 5.5% since late July but remains up about 13% for 2023.

“There is less urgency to aggressively buy pullbacks in a higher-for-longer world and that is what the market is going to have to deal with over the coming months,” said Angelo Kourkafas, senior investment strategist at Edward Jones.

Investors through the week will be monitoring data including on durable goods and the personal consumption expenditures price index for August, and second-quarter Gross Domestic Product, as well as remarks by Fed policymakers, including Chair Jerome Powell.

Chicago Fed President Austan Goolsbee said in an interview with CNBC on Monday that inflation staying above the Fed’s 2% target remains a greater risk than tight central bank policy slowing the economy more than needed.

In company news, Amazon.com shares rose 1.7% after the e-commerce giant said it will invest up to $4 billion in startup Anthropic to compete with growing cloud rivals in artificial intelligence.

Declining issues outnumbered advancers by a 1.2-to-1 ratio on the NYSE. There were 52 new highs and 341 new lows on the NYSE.

On the Nasdaq, declining issues outnumbered advancers by a 1.1-to-1 ratio. The Nasdaq recorded 45 new highs and 426 new lows.

About 9.1 billion shares changed hands in U.S. exchanges, compared with the 10 billion daily average over the last 20 sessions.

(Reporting by Lewis Krauskopf in New York, Ankika Biswas and Shashwat Chauhan in Bengaluru; Editing by Arun Koyyur, Maju Samuel and Richard Chang)

By Sinéad Carew and Amanda Cooper

NEW YORK/LONDON (Reuters) – A global index of stocks fell slightly while Wall Street eked out a gain in Monday’s choppy market as bond yields rose and investors continued to digest last week’s central bank indications that interest rates would stay higher for longer.

The dollar hit an 11-month high against the Japanese yen and the highest in almost 10 months against a basket of currencies after the U.S. Federal Reserve last week signalled it could raise interest rates further and was likely to hold them higher for longer than investors had expected.

U.S. economic risks that Powell noted in a press conference last week included the autoworkers’ strike, a possible federal government shutdown, resumption of student loan repayments, higher energy prices and higher long-term borrowing costs.

On Monday, Chicago Fed president Austan Goolsbee said inflation entrenched above the central bank’s 2% target remains a bigger risk than tight Fed policy slowing the economy more than needed.

The MSCI All-World index was last down 0.05% on the day, marking its seventh consecutive decline and its longest losing streak since early Sept 2022.

Still Wall Street’s three major indexes closed up slightly on Monday, providing some hope the market was steadying.

“We’re potentially putting in a bottom from the correction we’ve had. The market’s been volatile in the last couple of sessions. A lot has to do with the Fed and the focus on what the Fed is going to do,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.

But until the third-quarter earnings reporting season, which doesn’t start in earnest until October, there is “reason for the market to be stuck in neutral here,” said Ghriskey.

“Earnings could be a negative but they could also be a big positive so there’s some money sitting on the sidelines waiting for that,” he said.

Investors are also wary ahead of the next U.S. inflation reading, which is due on Friday, and “may stay in a wait and see mode,” until that is released, said Mona Mahajan, senior investment strategist at Edward Jones.

The Dow Jones Industrial Average rose 43.04 points, or 0.13%, to 34,006.88, the S&P 500 gained 17.38 points, or 0.40%, to 4,337.44 and the Nasdaq Composite added 59.51 points, or 0.45%, to 13,271.32.

The pan-European STOXX 600 index had earlier closed down 0.62%.

In U.S. Treasuries, yields were mostly higher with the benchmark 10-year yield building on three straight weeks of gains on expectations U.S. rates would stay higher for longer than previously anticipated.

Benchmark 10-year notes were up 10.2 basis points to 4.542%, from 4.44% late on Friday. The 30-year bond was last up 14.3 basis points to yield 4.6646%, from 4.522%. The 2-year note was last was up 0.2 basis points to yield 5.1249%, from 5.123%.

“The core rationale over the past couple of months has been pretty consistent in that the market continues to position itself for the ‘higher for longer’ type of environment,” said Jim Barnes, director of fixed income at Bryn Mawr Trust in Berwyn, Pennsylvania.

In currencies, the dollar index rose 0.35%, with the euro down 0.58% to $1.059 while Sterling was trading at $1.2212, down 0.21% on the day.

The Japanese yen weakened 0.31% versus the greenback at 148.84 per dollar, sticking close to the 150-per-dollar level many traders believe could represent a line in the sand for the Bank of Japan to intervene. The BOJ last week maintained its ultra-loose monetary policy.

Governor Kazuo Ueda, in a speech on Monday, reiterated the central bank’s resolve regarding interest rates and said there was “very high uncertainty” over whether companies would continue raising prices and wages.

U.S. crude oil futures settled lower while Brent was flat after choppy trade on Monday as Russia relaxed its fuel ban, after earlier gains on a tighter supply outlook, while investors eyed elevated interest rates that could curb demand.

U.S. crude settled down 35 cents or 0.39% at $89.68 per barrel while Brent ended at $93.29, up 2 cents or 0.02%.

(Reporting by Sinéad Carew, Chuck Mikolajczak, Saqib Iqbal Ahmed, in New York, Amanda Cooper in London and Stella Qiu; Editing by Himani Sarkar, Jacqueline Wong, Miral Fahmy, Mark Heinrich, David Gregorio and Deepa Babington)

Microsoft Upgraded Amid Artificial Intelligence Push

Microsoft has been one of the best-performing stocks, rallying by more than 30%. The rally, which has seen it outperform the S&P 500, which is up by about 15%, has come on the tech giant benefiting from the artificial intelligence boom.  With the boom, many analysts and investors have turned bullish and confident about the company’s long-term prospects as it continues to explore ways of benefiting from the AI boom.

Microsoft Upgrade

The upgrade from a sell to a neutral rating means that nearly 90% of analysts have a buy rating on the stock, with the rest maintaining a sell rating. The recommendation consensus on the stock stands at 4.74 out of 5, which is the fourth highest in the Nasdaq 100 index.

Following the upgrade, the stock does not have any sell rating on the street. However, the analysts at Guggenheim are still on the fence, thus the neutral rating. The analysts are questioning how much of the generative AI narrative will be monetized and generate significant value for Microsoft and other companies betting on the technology.

In addition, in a research note to investors, Guggenheim has also raised concerns about Microsoft’s struggles with its Windows product, which it says faces troubling dynamics. The research firm also feels growing pains in the market with the Azure cloud computing business, which could weigh on the stock’s sentiments.

Microsoft faces stiff competition to strengthen its cloud edge. Google and Amazon have also been spending big, especially on artificial intelligence innovations and solutions to strengthen their cloud unit. Competition from other smaller players also poses significant competition and danger to Azure Cloud.

Nevertheless, Microsoft is also maintaining a close eye on artificial intelligence, a technology expected to impact various solutions and products significantly. The software giant has already invested more than $10 billion in AI startup OpenAI, consequently gaining access to ChatGPT, one of the most talked about chatbots.

Microsoft AI Push

Microsoft CEO Satya Nadella has already made it clear that the company that becomes a market leader in artificial intelligence will garner a lion’s share of the riches in the technology over. Therefore, the executive is going all out to make Microsoft, a leading provider of AI solutions to, cash in on the new trend.

The $10 billion investment in OpenAI has enabled Microsoft to integrate ChatGPT in its search engine, Bing, strengthening its competitive edge against Google search. In addition, the search giant has also gained access to OpenAI AI resources and development resources. In return, Microsoft has built its own AI products and services, including Azure AI, a cloud-based service that offers access to tools for developing AI solutions.

Microsoft has also started integrating AI solutions into its traditional products, including Word, Outlook, and PowerPoint.  It’s also developing new features such as Windows Copilot, an AI assistant for Windows devices.  Competition for AI dominance is stiff, with Amazon, Google, and Meta Platforms also investing billions of dollars into emerging technology.

The AI boom spectacle also has been priced in significantly. Microsoft stock has come under pressure in recent days, recording seven consecutive days of losses. Nevertheless, the stock is still up by more than 30% for the year.

By Lewis Krauskopf, Ankika Biswas and Shashwat Chauhan

(Reuters) – Wall Street’s main indexes posted gains on Monday, with increases in Amazon.com shares and the energy sector, as Treasury yields rose further and investors looked to economic data and Federal Reserve policymakers’ remarks later in the week for clarity on the path for interest rates.

Investors are grappling with the rise in benchmark Treasury yields to 16-year highs after the Fed gave a hawkish longer-term rate outlook. The S&P 500 rebounded on Monday after last week it had its biggest weekly drop since March.

There is a “tug of war between investors seemingly getting more concerned about ‘higher for longer’ … and bulls wondering maybe we have seen the correction and we can start to build from these levels higher,” said Chuck Carlson, chief executive officer at Horizon Investment Services.

The Dow Jones Industrial Average rose 43.04 points, or 0.13%, to 34,006.88; the S&P 500 gained 17.38 points, or 0.40%, at 4,337.44; and the Nasdaq Composite added 59.51 points, or 0.45%, at 13,271.32.

Among S&P 500 sectors, energy led the way, rising 1.3%, while materials gained 0.8%. Defensive sectors lagged, with the consumer staples group dropping 0.4%.

With the end of the third quarter drawing near, investors said market moves may be relatively muted until companies report quarterly results in the coming weeks.

The S&P 500 has slid about 5.5% since late July but remains up about 13% for 2023.

“There is less urgency to aggressively buy pullbacks in a higher-for-longer world and that is what the market is going to have to deal with over the coming months,” said Angelo Kourkafas, senior investment strategist at Edward Jones.

Investors through the week will be monitoring data including on durable goods and the personal consumption expenditures price index for August, and second-quarter Gross Domestic Product, as well as remarks by Fed policymakers, including Chair Jerome Powell.

Chicago Fed President Austan Goolsbee said in an interview with CNBC on Monday that inflation staying above the Fed’s 2% target remains a greater risk than tight central bank policy slowing the economy more than needed.

In company news, Amazon.com shares rose 1.7% after the e-commerce giant said it will invest up to $4 billion in startup Anthropic to compete with growing cloud rivals in artificial intelligence.

Declining issues outnumbered advancers by a 1.2-to-1 ratio on the NYSE. There were 52 new highs and 341 new lows on the NYSE.

On the Nasdaq, declining issues outnumbered advancers by a 1.1-to-1 ratio. The Nasdaq recorded 45 new highs and 426 new lows.

About 9.1 billion shares changed hands in U.S. exchanges, compared with the 10 billion daily average over the last 20 sessions.

(Reporting by Lewis Krauskopf in New York, Ankika Biswas and Shashwat Chauhan in Bengaluru; Editing by Arun Koyyur, Maju Samuel and Richard Chang)

By Davide Barbuscia

NEW YORK (Reuters) -A U.S. government shutdown would negatively impact the country’s credit, credit rating agency Moody’s said on Monday, a stern warning coming one month after Fitch downgraded the U.S. by one notch on the back of a debt ceiling crisis.

U.S. government services would be disrupted and hundreds of thousands of federal workers furloughed without pay if Congress fails to provide funding for the fiscal year starting Oct. 1.

A possible shutdown would be further evidence of how political polarization in Washington is weakening fiscal policymaking at a time of rising pressures on U.S. government debt affordability because of higher interest rates, Moody’s analyst William Foster told Reuters.

“If there is not an effective fiscal policy response to try to offset those pressures … then the likelihood of that having an increasingly negative impact on the credit profile will be there,” said Foster. “And that could lead to a negative outlook, potentially a downgrade at some point, if those pressures aren’t addressed.”

Moody’s has an “Aaa” rating for the U.S. government with a stable outlook – the highest creditworthiness it assigns to borrowers. It is the last major agency with such a rating after Fitch downgraded the U.S. government triple A rating by one notch in August to AA+ – the same rating assigned by S&P Global in 2011.

“Fiscal policymaking is less robust in the U.S. than in many Aaa-rated peers, and another shutdown would be further evidence of this weakness,” Moody’s said in a statement.

The economic impact of a shutdown would likely be limited and short-lived, with the most direct economic impact caused by lower government spending. Of course, the longer the shutdown lasts, the more negative its impact would be on the broader economy, said Moody’s.

Congress so far has failed to pass any spending bills to fund federal agency programs in the fiscal year starting on Oct. 1 amid a Republican Party feud.

The shutdown would not impact government debt payments but it would come just a few months after political brinkmanship around the U.S. debt limit threatened to cause a U.S. sovereign debt default.

That crisis, even though it was eventually resolved before any missed debt payment, was a major factor leading Fitch to downgrade its U.S. rating by one notch last month.

“In this environment of higher rates for longer and pressures building on the debt affordability front, it’s that much more important that fiscal policy can respond,” said Foster at Moody’s.

“And it looks increasingly challenged because of things like the government shutdown and having come off the debt limit episode, because it’s such a polarized political dynamic in Washington,” he said.

(Reporting by Davide Barbuscia; Editing by Megan Davies, Sharon Singleton and Josie Kao)