Sharon Osbourne says Ozy Media founder Carlos Watson lied when he claimed the Osbournes invested in his company - CNBC

Two years ago, Carlos Watson, co-founder and CEO of Ozy Media, told CNBC during a live television broadcast that heavy metal legend Ozzy Osbourne and his wife, music industry manager and former talk show host Sharon Osbourne, became friends with him and invested in his company after a legal battle.

"Fun fact: our friend Ozzy and Sharon sued us briefly, and then we decided to be friends and now they're investors in Ozy," Watson said on CNBC at the time. (You can watch the video above.)

It turns out none of that was true, according to Sharon Osbourne, who spoke to CNBC on Thursday just as hedge fund honcho Marc Lasry quit as Ozy Media's chairman.

Lasry's resignation, and the revelation from Sharon Osbourne, came days after The New York Times reported that an Ozy executive had posed as a YouTube official on a February call with Goldman Sachs over a potential $40 million investment. Beyond Lasry's resignation, veteran journalist Katty Kay has resigned from Ozy Media and investor SV Angel has decided it's giving up its shares in the company.

"This guy is the biggest shyster I have ever seen in my life," Osbourne said, referring to Watson, just after CNBC answered her phone call. Osbourne said she had reviewed Watson's claim after CNBC reached out to her team with the details in the wake of the various controversies surrounding Ozy Media.

Ozzy Osbourne and Sharon Osbourne announce that Ozzfest 2007 will be free. The announcement was made during a press conference at the Century Plaza hotel in Los Angeles, California on February 6, 2007.

Jason Merritt/TERM | FilmMagic | Getty Images

The Osbournes filed a trademark lawsuit in 2017 over the name Ozy Fest, which is Ozy Media's annual concert and festival. The Osbournes had for years produced a metal music festival called Ozzfest, which has featured acts such as Ozzy Osbourne's original band Black Sabbath, Tool and Slayer.

Sharon Osbourne told CNBC that Watson tried to intimidate her amidst the suit being filed, saying that his company has a ton of resources and could draw out the legal battle so much that the family would have had to continue to pay exorbitant legal fees.

Osbourne said the two sides settled after the couple finished paying around $300,000 in legal fees over the trademark battle between Ozy Media and the Osbournes' company.

The Wrap reports that court documents filed against Ozy Media at the time claim the Ozy Fest trademarks "are nearly identical in sight, sound, connotation and commercial impression to MLC's [Monowise Limited Corp.] well-known Ozzfest mark."

Court documents say the settlement came in 2018. Osbourne shared with CNBC the details of the agreement.

"He couldn't have the sort of artists that we have on our bill," Osbourne said, referring to Watson. "So he couldn't have any rock artists or alternative artists on his bill. Because he was starting to take rap artists and we've had a few rap artists on. So I'm like 'this is getting ridiculous now.' So, he had to approve the bills with me and he had to approve the advertising with me."

An Ozy Media spokesperson did not return repeated emails seeking comment on Osbourne's remarks.

Carlos Watson speaks onstage during HISTORYTalks Leadership & Legacy presented by HISTORY at Carnegie Hall on February 29, 2020 in New York City.

Noam Galai | Getty Images

Watson and his company have been under increasing scrutiny since a report by The New York Times detailed a number of controversies at Ozy Media. The report describes an instance when an Ozy Media executive allegedly impersonated a YouTube representative in a phone call with Goldman Sachs, which was thinking about investing in Watson's firm. The FBI has reportedly started probing the phone call.

In a tweet Monday, Watson called the Times article a "hitjob." He hasn't tweeted since.

Watson, a former MSNBC contributor and CNN host, founded Ozy Media in 2013. The company produces online articles and television programming. It has attracted support from several big-name investors and celebrities, such as former New York Yankees slugger Alex Rodriguez. Joe Biden, Dr. Anthony Fauci and Mark Cuban have appeared at Ozy Fest events.

In 2019, Watson, while sitting next to Ozy investor and its eventual chairman, Lasry, told CNBC that after the lawsuit was settled with the star couple, they became investors in his business. Lasry, a hedge fund manager and co-owner of the NBA champion Milwaukee Bucks, was named chair of Ozy Media's board in September.

After he was asked whether the Osbournes invested in Ozy, Watson said: "Now they're investors. They're part of the family." He was appearing on CNBC to promote Ozy Fest, which was set to take place in New York at the time. CNBC was the media partner for Ozy Fest 2019, which was canceled due to extreme heat.

Osbourne, herself a longtime TV personality, said that neither she nor her husband have ever been shareholders in the company. Sharon Osbourne left the daytime show "The Talk" this year following a heated conversation on air and an internal investigation.

(L-R) Samantha Bee, Mark Cuban, CEO and Co-Founder Carlos Watson, and Jeb Bush speak onstage during OZY FEST 2017 Presented By OZY.com at Rumsey Playfield on July 22, 2017 in New York City.

Bryan Bedder | Getty Images

"We're not ever, ever a friend, and we don't have any interest in his company," Osbourne said in response to Watson's claims in the CNBC interview. When asked whether she and her husband have ever invested in Watson's company, Osbourne said: "You must be joking. No way did we invest in anything."

Osbourne said her husband, Ozzy Osbourne, has never spoken or met with Carlos Watson, while she and Watson have only spoken over the phone.

"He's insane," Osbourne said about Watson. She noted that during the legal battle he did offer her shares of the company but she declined.

"To be honest, he did say, 'Well we'll give you shares in the company, but I said 'your company is worth nothing.' He said, 'We have all this backing. All these billionaire people. And you know we can keep on suing you and I can give you some shares.' But I'm like, 'Shares in what? What do you do?'"

Watson, according to Osbourne, repeatedly tried these tactics during the conversations.

"Then he tells me he's got billions behind him because his main shareholder of the company is the wife of a guy that died [and ran] Apple," Osbourne said, referring to Emerson Collective's Laurene Powell Jobs. He also used Powell Jobs' wealth as an intimidation factor, according to Osbourne. "We've got her money behind us. I'll fight you all the way," Osbourne said Watson told her.

"I'm like, 'But it's not right you've stolen this name,'" Osbourne said.

Watson has appeared on CNBC numerous times, including in January of this year -- when he was on a panel with Ben Smith, The New York Times editor who broke the story over the weekend about the Goldman Sachs call.

-- CNBC's Dan Mangan contributed to this article.

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Sharon Osbourne says Ozy Media founder Carlos Watson lied when he claimed the Osbournes invested in his company - CNBC
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Watch Powell and Yellen testify live on Covid response before House committee - CNBC

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Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell testify Thursday before the House Committee on Financial Services on their respective agencies' response to the Covid-19 pandemic.

In appearances Tuesday before the Senate banking panel, the two emphasized the importance of the programs put in place during the crisis and expressed optimism about the economic outlook.

Read more:
Sen. Warren calls Fed Chair Powell a 'dangerous man,' says she will oppose his renomination
Fed Chair Powell calls inflation 'frustrating' and sees it running into next year
Congress moves to prevent a government shutdown with deadline hours away

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Facebook publishes slides on how Instagram affects teen mental health - Engadget

Facebook has published two slide decks detailing its research into how Instagram affects teens’ mental health. The slides were heavily cited by The Wall Street Journal earlier this month in a story that reported the company’s own researchers had found that ““Instagram is harmful for a sizable percentage” of teens, particularly teenage girls.”

Instagram has attempted to rebut those claims, saying that its research was mischaracterized. But the ensuing backlash has already forced the company to “pause” its work on an Instagram Kids app. It also raised pressure on Facebook to release the underlying research, which the company ultimately agreed to do. Facebook’s head of safety is scheduled to testify at a Senate Commerce Committee hearing on child safety on Instagram Thursday.

The slides offer a rare glimpse into how Facebook researches thorny issues affecting its own services. Many include lengthy annotations with additional “context” on the more controversial aspects of the research. For example, a slide titled “The Perfect image, feeling attractive, and having enough money are most likely to have started on Instagram,” states that the information in the slide “should not be used as estimates of average experience among teen users.”

Facebook

Other annotations, like one on a slide, titled “One in five teens say that Instagram makes them feel worse about themselves, with UK girls the most negative,” attempt to downplay the findings. “This research was not intended to (and does not) evaluate causal claims between Instagram and health or well-being.” (That line is repeated on several other slides.)

The research also offers insight into what type of content is positively perceived by teens on Instagram. One slide states that meme accounts are among the content that “make teens feel the best.”

Facebook

The release of the research is unlikely to quiet Facebook’s critics, particularly those in Congress who were already deeply suspicious of the company’s attempts to woo children onto its services. Some Democratic lawmakers have called on the company to abandon its work on Instagram Kids entirely. For Facebook, younger users are not just one of the most important demographics, but one where the company has been consistently losing out to rivals like Snapchat and Instagram.

Other research, also conducted by Facebook and published by The Wall Street Journal this week, found that Facebook has been struggling to keep tween and teens engaged. In one slide, which has not been made public by Facebook, the company discussed whether young children’s playdates could be used “as a growth lever for Messenger Kids.” Facebook later said that it “was an insensitive way to pose a serious question and doesn’t reflect our approach to building the app.”

Update 9/29/21 11:32PM ET: The Wall Street Journal has published internal documents, including ones Facebook didn't include in its report about how Instagram affects teens' mental health. 

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Macy's Wants To Block Amazon Ads From A Giant Billboard Next To Its Flagship Store - NPR

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Macy's is trying to keep a competitor — Amazon? — from advertising on a giant billboard next to Macy's flagship store in Herald Square in New York. Bebeto Matthews/AP

Bebeto Matthews/AP

NEW YORK — Macy's has filed a lawsuit against the company that owns the giant billboard next to its flagship Manhattan store, fighting to prevent Amazon from taking over the advertising space that carried Macy's name for almost 60 years.

In the lawsuit, filed last week in state Supreme Court in Manhattan, the department store retailer said there has been a restrictive covenant in place since 1963 barring the billboard space from being used by any Macy's competitor.

But Macy's said that when it tried to negotiate a lease renewal this year, the billboard's owners, the Kaufman Organization, told them they were in discussions with a "prominent online retailer," and there was "little doubt" that meant Amazon, according to the lawsuit.

Messages were left with the Kaufman Organization seeking comment. Amazon had no comment.

In the lawsuit, Macy's asked the judge for an injunction that would keep Kaufman from leasing the space to Amazon or any other competitor.

"The damages to Macy's customer goodwill, image, reputation and brand, should a 'prominent online retailer' (especially, Amazon) advertise on the billboard are impossible to calculate," the company said in the lawsuit.

The lawsuit pointed out that the billboard is highly visible in its annual Thanksgiving Day parade, which is nationally televised.

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More items over $1 to be sold at Dollar Tree | TheHill - The Hill

The retail chain long known for its affordable goods set at around $1 will begin to sell more goods above that price point, Dollar Tree announced on Tuesday.

The retail chain, which has nearly 8,000 stores, has already sold items at some of its locations for over $1. Beginning in 2019, some of its stores had an area of their space called Dollar Tree Plus that sold items for $3 and $5, The Wall Street Journal reported. Dollar Tree noted in its announcement that it was making the move following the success of its Dollar Tree Plus format and positive customer reaction.

“For decades, our customers have enjoyed the ‘thrill-of-the-hunt’ for value at one dollar - and we remain committed to that core proposition - but many are telling us that they also want a broader product assortment when they come to shop,” Dollar Tree CEO Michael Witynski said in a statement on Tuesday.

“We believe testing additional price points above $1 for Dollar Tree product will enable us over time to expand our assortments, introduce new products and meet more of our customers’ everyday needs,” he continued. 

According to the Journal, the retail chain will begin selling some of its goods at $1.25 and $1.50. In an interview with the newspaper, Witynski cited that the decision comes amid increased freight, supply-chain and wage costs. The chief executive told the news outlet that raising the costs of some of its items could allow customers to buy new items that the retail chain introduces like seasonal items or frozen meat.

All stores that have a Dollar Tree Plus section will sell more items above $1; the higher price point will also be used in some of its legacy stores, the company said in their Tuesday announcement.

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Jim Cramer says these six factors are driving the stock market sell-off - CNBC Television

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National Coffee Day 2021: Get free coffee at Starbucks, Dunkin’, Panera, Krispy Kreme Wednesday - USA TODAY

United Airlines Is Firing Workers Over Vaccine Noncompliance - The New York Times

United Airlines is terminating about 600 employees for refusing to comply with its vaccination requirement, the company said in a memo sent to staff on Tuesday.

“This was an incredibly difficult decision but keeping our team safe has always been our first priority,” the airline said in the memo.

The company said on Wednesday that it had already begun its termination process for its U.S.-based employees. Workers losing their jobs because of noncompliance with the mandate make up less than 1 percent of the airline’s U.S. work force of 67,000.

“We will work with folks if during that process they decide to get vaccinated,” said a spokeswoman at United Airlines, which did not give a timeline for the termination process.

In early August, the airline announced that all employees would be required to provide proof of vaccination within five weeks of a vaccine’s full approval by the Food and Drug Administration or by Oct. 25, whichever came first. The F.D.A. in late August granted full approval to Pfizer-BioNTech’s coronavirus vaccine for people 16 and older. United had also said it would fire employees who did not follow the new policy.

Other airlines have taken different measures to encourage employees to get inoculated. Delta Air Lines announced last month that it was adding a $200 monthly surcharge on its health care plan for employees who were not vaccinated. The company has also said that it requires new employees to be vaccinated, but that existing employees are exempt. American Airlines said it was “not putting mandates in place” for employees or customers.

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With just 1% of the eyeglasses market, Warby Parker co-CEOs explain why they're going public - CNBC

In this article

• WRBY

The eyewear start-up Warby Parker is set to begin trading Wednesday morning via a direct listing, testing investors' appetite for a household direct-to-consumer retail name.

The stock will trade on the New York Stock Exchange under the ticker symbol WRBY.

Warby Parker joins names such as Spotify, Roblox and Coinbase that have also gone public through a direct listing, rather than an initial public offering. In a direct listing, a company doesn't raise new capital from banks. Instead, it lists its shares on an exchange, and the shares begin trading at a price set through negotiation between the company and public investors. Insiders are then able to sell shares whenever they choose.

The NYSE set a reference price of $40 on Tuesday night based on previous trades on private markets, but ultimately the publicly listed price was based on investor demand. That would give the company a market value of about $4.5 billion, based on its outstanding shares. Shares of the company had traded privately in April at $24.53, according to company filings.

When Warby Parker was founded in 2010, the company was initially sending customers glasses to try on at home and keep what they wanted to buy. The company has expanded by opening up stores, which has helped to balance out the hefty expenses that come with running a massive e-commerce operation. In 2019, it launched a line of daily contact lenses.

"We have less than 1% of market share in this massive category, and see huge tailwinds to grow our top line and our bottom line in the years to come," Dave Gilboa, co-founder and co-CEO, said Wednesday on "Squawk Box."

"There's so much opportunity to scale our physical retail footprint but also scale our e-commerce offering," he said.

In recent years, Warby Parker's sales have grown but so have its losses. Its net revenue in the fiscal year that ended Dec. 31, 2020, grew to $393.7 million from $370.5 million in 2019, according to documents filed with the Securities and Exchange Commission. Warby Parker broke even two years ago, but in 2020 its net loss totaled $55.9 million.

In recent months, Warby Parker has continued to lose money. It lost $7.3 million in the six months ended June 30.

One of the eyeglass maker's largest investments in the coming years will be in bricks-and-mortar growth, which Warby Parker hopes will fuel earnings. While it forecasts revenue will keep growing, the company has yet to reveal when it might become profitable.

The company is planning to open 30 to 35 new stores by the end of fiscal 2021, bringing its total shop count to about 155 to 160 locations.

Although its stores were temporarily shut during the pandemic, Warby Parker has benefited from having a strong digital presence. Many consumers are still shopping more online. Roughly 50% of Warby Parker's sales came from digital in the first six months of this year, according to the company's filings, compared with 60% last year.

"Ultimately we don't care where a customer transacts," Gilboa said. "We just want to make sure that they have the best experience possible."

Warby Parker is also looking to grow in categories beyond glasses. Last year, about 95% of its sales were glasses, while 2% came from contact lenses, 1% from eye exams and 2% from eyewear accessories.

Neil Blumenthal, co-founder and co-CEO, sees the chance to scale in those other categories.

"Contact lenses are 2% of our business, but it's a $5 billion-plus market," he said. "Same with eye exams ... 1% of our business, but it's also a $5 billion-plus [market] — massive opportunities for us in the future."

For its fiscal third quarter that will end on Thursday, Warby Parker sees net revenue ranging between $131 million and $133 million, which would represent an increase of 26% to 28% from 2020 levels.

For the year, it expects sales to total $532 million to $537 million. In fiscal 2022, Warby Parker estimates, net revenue will rise at least 25% from the prior year.

In Warby Parker's direct listing, registered stockholders will be able to sell 77.7 million Class A shares, but the company won't receive any proceeds from those sales.

This story is developing. Please check back for updates.

Warby Parker is a four-time CNBC Disruptor 50 company.

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Elon Musk to Jeff Bezos: 'you cannot sue your way to the Moon' - The Verge

Elon Musk isn’t happy that fellow mega-billionaire Jeff Bezos keeps suing to stop SpaceX’s projects, and he shared a message for the Amazon founder during the 2021 Code Conference on Tuesday: “you cannot sue your way to the Moon, no matter how good your lawyers are.”

Musk was responding to a question from journalist Kara Swisher about how Bezos’ space company, Blue Origin, recently sued to block a contract NASA gave SpaceX to develop a lunar lander. Amazon has also protested SpaceX’s Starlink internet satellites with the Federal Communications Commission.

Swisher asked Musk Tuesday if he has spoken to Bezos about the legal fights. “Not verbally, just... subtweets,” Musk said. (In August, Musk tweeted: “Turns out Besos [sic] retired in order to pursue a full-time job filing lawsuits against SpaceX …”)

Musk wasn’t all vinegar with regards to his billionaire space race cohort. When Swisher asked him about the suborbital flights that Bezos and Richard Branson recently took with their own companies, Musk said he “thought it was cool that they’re spending money on the advancement of space.” But, he was sure to point out, “suborbital is [just] a step in the direction of orbit.”

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Elizabeth Warren Calls Jerome Powell a ‘Dangerous Man’ - The New York Times

Senator Elizabeth Warren, Democrat of Massachusetts, blasted the Federal Reserve chair, Jerome H. Powell, for his financial regulation track record and said that she would not support him if the White House renominated him, calling him a “dangerous man to head up the Fed.”

Mr. Powell’s term as head of the central bank ends in early 2022, and the Biden administration is considering whether to reappoint him. Mr. Powell, a Republican, was nominated to the Fed’s Board of Governors by former President Barack Obama and elevated to chair by former President Donald J. Trump.

While some prominent Democratic economists and advocacy groups support Mr. Powell, who has been intensely focused on the labor market during his term as Fed chair, some progressives openly oppose him. They often cite his track record on financial regulation — as Ms. Warren did to his face on Tuesday, as he testified before the Senate Banking Committee.

“The elephant in the room is whether you’re going to be renominated,” Ms. Warren said, looking down at the Fed chair during the hearing. “Renominating you means gambling that, for the next five years, a Republican majority at the Federal Reserve, with a Republican chair who has regularly voted to deregulate Wall Street, won’t drive this economy over a financial cliff again.”

Ms. Warren, and those who agree with her, have worried that leaving Mr. Powell in place will prevent the Fed from taking a tougher stance on financial regulation. Mr. Powell has said that when it comes to regulatory matters, he defers to the Fed’s vice chair for supervision, noting that Congress created that job to lead up bank oversight following the 2008 financial crisis.

“I respect that that’s the person who will set the regulatory agenda going forward,” Mr. Powell said during a news conference last week. “And furthermore, it’s fully appropriate to look for a new person to come in and look at the current state of regulation and supervision and suggest appropriate changes.”

Ms. Warren’s colleague Senator Michael Rounds, a Republican from South Dakota, followed her scathing comments by saying that Mr. Powell deserved to be renominated, and that he looked forward to working him for the next several years.

The White House has so far given little indication of whom it will pick to lead the central bank.

President Biden already has the opportunity to fill one open governor position at the Fed, and several other roles will soon become available: The governor seat of the Fed’s vice chair, Richard Clarida, will expire in the coming months, as will Randal K. Quarles’s position as vice chair for supervision. The openings could give the administration a chance to remake the central bank from the top with its nominations, who must pass Senate confirmation.

Other lawmakers at the Senate hearing pushed Mr. Powell to focus on improving diversity at the central bank — highlighting another key concern among Democrats as the leadership shuffle gets underway.

Senator Sherrod Brown, a Democrat from Ohio and the head of the Senate Banking Committee, pointed out that there had never been a Black woman on the Federal Reserve’s Board of Governors in Washington, while also referring to reporting from earlier this year that showed a dearth of Black economists at the central bank.

He asked if Mr. Powell believed that the central bank should have a Black woman on its Board of Governors.

“I would strongly agree that we want everyone’s voice heard around the table, and that would of course include Black women,” Mr. Powell said. “We of course have no role in the selection process, but we would certainly welcome it.”

Lisa Cook, a Michigan State University economist, and William Spriggs, chief economist of the labor union AFL-CIO, are often raised as possible candidates for governor positions or leadership roles. Both are Black. Lael Brainard, a white woman who is currently a Fed governor, is frequently raised as a possible replacement for Mr. Powell if he is not renominated, and Sarah Bloom Raskin, a white woman who is a former top Fed and Treasury official, is often suggested as a replacement for Mr. Quarles.

Mr. Powell, as he noted, has no formal role in selecting his future colleagues at the Fed Board.

He and his colleagues at the Fed Board will, however, have a chance to weigh in on who will take over two newly open positions around the Fed’s decision-making table. The central bank has 19 total officials at full strength, seven governors and 12 regional bank presidents.

Robert S. Kaplan, the Dallas Fed president, and Eric S. Rosengren, the Boston Fed president, both announced their imminent retirements on Monday, amid widespread criticism of the fact that they were trading securities in 2020 — during a year in which the Fed unrolled a widespread market rescue in response to the pandemic.

Mr. Powell addressed that scandal on Tuesday, pledging to lawmakers that the Fed would change its ethics rules and saying that the Fed was looking into the trading activity to make sure it was in compliance with those rules and with the law.

“Our need to sustain the public’s trust is the essence of our work,” Mr. Powell said, adding that “we will rise to this moment.”

Beyond grabbing headlines, the departures will leave two regional bank jobs available at the Fed. The regional branches’ boards, except for bank-tied members, will search for and select replacement presidents. The Fed’s governors in Washington have a “yes” or “no” vote on the pick.

The Fed has never had a Black woman as a regional bank president, either. Raphael Bostic, president of the Federal Reserve Bank of Atlanta, is the first Black man to serve in one of those roles.

At the Board of Governors, Mr. Quarles’s leadership term ends most imminently, on Oct. 13. His position as governor does not expire until 2032, and he has signaled that he will likely stay on as a Fed governor at least through the end of his leadership term at the Financial Stability Board, a global oversight body, in December. Mr. Powell’s leadership term ends in early 2022, though he could stay on as governor since his term in that role does not expire until 2028. Mr. Clarida will have to leave early next year unless he is reappointed.

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Ford to build new plants in Tennessee, Kentucky in $11 billion investment in electric vehicles - USA TODAY

Sanofi ditches mRNA COVID-19 vaccine amid rivals' success - Reuters

PARIS, Sept 28 (Reuters) - Sanofi (SASY.PA) is dropping plans for its own mRNA-based COVID-19 vaccine because of the dominant role of the BioNTech-Pfizer (22UAy.DE)(PFE.N) alliance as well as Moderna (MRNA.O) in the fight against the pandemic, the company said on Tuesday.

The move highlights the challenges of competing in particular with pioneer BioNTech (22UAy.DE), which rose from obscurity through its alliance with pharma major Pfizer last year. The pair have delivered close to 1.5 billion doses so far, making them the western world's largest COVID-19 vaccine maker.

French healthcare group Sanofi will instead focus on efforts with British partner GlaxoSmithKline to bring another COVID-19 vaccine candidate to market based on the more conventional protein-based approach, where mass trials are ongoing. read more

The decision to drop clinical development of a shot based on mRNA, or messenger RNA, acquired as part of its takeover of Translate Bio , came despite positive Phase I/II study interim results announced on Tuesday where participants' blood readings showed a strong immune reaction.

But Sanofi said the read-out encouraged it only to pursue the technology as a potential vaccine against influenza and other diseases, giving up on the area of COVID-19 because of the strong market presence of the two approved mRNA shots.

"These results will clearly help inform the path forward for our mRNA development programs," said Jean-Francois Toussaint, global head of research and development at Sanofi Pasteur.

Sanofi's shares gained 1.1% to 83.01 euros by 0850 GMT, outperforming a 0.9% decline in the STOXX Europe 600 Health Care (.SXDP).

"The decision to end RNA looks to be interpreted as positive since they will save development costs and concentrate on other products and ventures," said Ion-Marc Valahu, a fund manager at Geneva-based investment firm Clairinvest.

The company said it started testing an mRNA shot against seasonal influenza in humans in June and will launch follow-on clinical studies next year.

The development of RNA flu shots is already shaping up to be a tight race as drugmakers hope they can more quickly adjust the vaccine to ever-changing strains in circulation.

Pfizer said this week it started testing an mRNA flu vaccine. Moderna has several influenza vaccine candidates in development, including combinations that include a COVID-19 booster. read more

Established influenza vaccine supplier Seqirus, part of Australia's CSL (CSL.AX), for instance, is working on next-generation low-dose RNA flu shots, known as self-amplifying RNA.

Companies including Novavax are working on novel flu shots using new technology beyond mRNA. read more

Sanofi reported 2.5 billion euros ($2.9 billion) in sales from flu vaccines in 2020, the largest of its vaccine business, which recorded total sales of 5.9 billion euros.

The mRNA vaccines trick the human body into producing proteins known as antigens that are found on the surface of the coronavirus that causes COVID-19. That primes the immune system to quell future infections.

Under the more traditional protein-based vaccine approach that Sanofi will now focus on, the antigen is bioengineered in labs and combined with an efficacy booster known as an adjuvant, provided by GSK.

Sanofi executive Thomas Triomphe told journalists in a briefing that the EU and Britain had ordered 75 million doses of this vaccine, banking on future regulatory approval.

German biotech firm CureVac (5CV.DE) earlier this month also acknowledged rivals' dominance when it cancelled some of the contract manufacturing deals for its experimental mRNA COVID-19 vaccine with two prospective partners. read more

CureVac's product is under review by the European Union's drugs regulator with an uncertain outcome after disappointing trial results.

Sanofi shares lag rivals

Moderna's market cap overtakes Sanofi

($1 = 0.8537 euros)

Reporting by Ludwig Burger, Sarah White and Sudip Kar-Gupta, editing by David Evans and Louise Heavens

Our Standards: The Thomson Reuters Trust Principles.

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Nestlé recalls over 27,000 pounds of frozen DiGiorno pepperoni pizza - CNN

New York (CNN Business)A packaging mixup has prompted a recall of a batch of DiGiorno pepperoni pizzas.

Nestlé USA, which owns the frozen pizza brand, has recalled a batch of 26-ounce boxes labeled DiGiorno Crispy Pan Crust Pepperoni Pizzas because they actually contain Three Meat Crispy Pan Crust Pizza. The three meat pizza includes soy protein — it's in the beef topping and sausage crumbles — and can be harmful to people with soy allergies.

A packaging mixup prompted Nestle USA to recall a batch of DiGiorno pizza.

The company said it became aware of the issue after it was contacted by a consumer. The affected boxes have the manufacturing date June 30, 2021, and a "best by" date of March 2022. The batch code on the items is 1181510721.

The recall affects 27,872 pounds of pizza, according to the US Department of Agriculture.

These products were shipped out to distribution centers and retailers across the country, the USDA noted. The agency and Nestlé both recommended that people who bought the affected pizzas throw them out or return them.

Nestlé said that if you're not allergic to soy, it should be safe to eat the pizzas.

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Dallas Fed President Kaplan to retire early on Oct. 8, citing trading disclosure 'distraction' - CNBC

Dallas Federal Reserve President Robert Kaplan became the second regional central bank leader to resign Monday, saying he was stepping down early following a recent controversy over stock market trades he made.

Kaplan's early retirement follows an announcement earlier in the day from Boston Fed President Eric Rosengren, who said he will leave as well but cited health concerns and not the issue over his investment portfolio activity.

"The Federal Reserve is approaching a critical point in our economic recovery as it deliberates the future path of monetary policy. Unfortunately, the recent focus on my financial disclosure risks becoming a distraction to the Federal Reserve's execution of that vital work," Kaplan said in a statement.

His retirement takes effect Oct. 8. The resignations come a day before Fed Chair Jerome Powell is to spend two days on Capitol Hill updating legislators on the central bank's efforts to combat the economic impact of the Covid-19 pandemic.

Controversy had swirled over the issue after disclosures that Kaplan in particular had been executing large-dollar trades in big-name companies such as Amazon, Apple and Delta Air Lines. The Wall Street Journal first reported the trades.

Subsequent to the disclosures, both Kaplan and Rosengren said they would be selling their stocks to avoid the appearance of conflict. Questions were raised because the Fed has conducted trillions of dollars in asset purchases aimed at helping markets function, and has bought corporate bonds from mega-cap companies including Apple.

Kaplan insisted he had done nothing wrong.

"During my tenure, I have adhered to all Federal Reserve ethical standards and policies," he said in his monthly statement. "My securities investing activities and disclosures met Bank compliance rules and standards."

Still, the issue has reverberated through the Fed, with officials pledging to tighten rules so that such potential conflicts don't happen again.

"We need to make changes, and we're going to do that as a consequence of this," Powell said last week. "This will be a thorough going and comprehensive review. We're going to gather all the facts and look at ways to further tighten our rules and standards."

Powell vowed that changes would be made.

"I want to be able to look back on this years from now and know that we rose to meet this challenge and handled the situation well and that what we did made a lot of sense and protected the public's interest and the institution that we're all a part of," he said.

Powell on Monday wished Kaplan well and praised his work at the Dallas Fed.

"He has been a passionate and forceful public voice on a wide range of issues, including the critical value of early childhood education and literacy," the chairman said in a statement.

Meredith Black, the first vice president at the Dallas Fed who herself was planning on retiring, will serve as interim head for the district until a permanent successor is chosen.

This is breaking news. Please check back for updates.

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Dow Jones Futures: Pelosi Makes Key Infrastructure Decision; Tesla, AMD Are In Buy Areas - Investor's Business Daily

Dow Jones futures tilted lower Monday night, along with S&P 500 futures and Nasdaq futures. House Speaker Nancy Pelosi told her Democratic caucus late Mondaythat she is no longer linking the bipartisan $1 trillion infrastructure bill to passage of a much-larger reconciliation package. That also comes as Senate Republicans blocked a bill to raise the debt limit and extend government financing.

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The stock market rally had a mixed Monday, with the Dow Jones and small-cap Russell 2000 rallying while the S&P 500 and Nasdaq composite retreated.

Tesla stock extended Friday's breakout and hit yet another key level on Monday. That comes as Tesla (TSLA) plans to open FSD Beta to tens of thousands of Full Self-Driving owners or subscribers starting as soon as Oct. 1.

Advanced Micro Devices (AMD) rebounded bullishly from its 50-day and a trendline, both offering early buy signals.

Energy stocks powered higher on strong gains for crude oil prices and surging natural gas futures. Whiting Petroleum (WLL) and Targa Resources (TRGP) broke out of bases.

MGM Resorts (MGM) moved higher in a buy range while Hilton Worldwide (HLT) broke out. Travel stocks did well overall, with Covid cases continuing to trend lower. Airline stocks and cruise lines are rebounding after sliding for months.

Finally, rising Treasury yields continued to buoy financials. JPMorgan Chase (JPM) broke out of a cup-with-handle base on Monday.

Tesla stock and AMD are on IBD Leaderboard. AMD stock also is on SwingTrader and was Monday's IBD Stock Of The Day.

The video embedded in this article reviews Monday's market action and analyzes TRGP stock, AMD and PerkinElmer (PKI).

Pelosi Infrastructure Bill Decision

Speaker Pelosi, after months of trying to link the $1 trillion infrastructure bill to a much-larger, partisan spending, said she is no longer pursuing that plan. That's a victory for centrist Democrats, who believe the bipartisan infrastructure package, with some $550 billion in extra funding, was being held hostage. With a 3-seat Democratic majority in the House, Pelosi has little room to maneuver. It's unclear if left-wing Democrats will vote for the infrastructure deal, which will likely get only a handful of GOP House votes, without some sort of assurances on the reconciliation package. Pelosi has recently signaled the reconciliation bill will be smaller than the long-targeted $3.5 trillion, with Sen. Joe Manchin, D-W.V., pushing for $1 trillion to $1.5 trillion.

The infrastructure bill vote is currently set for Thursday. If the bill doesn't pass, then existing highway spending authorization runs out as well.

Meanwhile, Senate Republicans rejected a measure to avoid a partial government shutdown after Sept. 30. Republicans object to raising the debt limit as well, saying Democrats should do it themselves.

Dow Jones Futures Today

Dow Jones futures lost a fraction vs. fair value. S&P 500 futures declined 0.2% and Nasdaq 100 futures fell 0.3%.

Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.

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Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live

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Stock Market Rally

The stock market rally opened mixed and stayed that way, with the 50-day line acting as support or resistance in many cases.

The Dow Jones Industrial Average rose 0.2% in Monday's stock market trading. The S&P 500 index fell 0.3%. The Nasdaq composite sank 0.5%. The small-cap Russell 2000 popped 1.5%.

The 10-year Treasury yield rose as high as 1.51% early Monday, a three-month best. The benchmark yield closed up two basis points at 1.48%.

Many medical product stocks were down sharply, including Moderna (MRNA), Charles River Laboratories (CRL), Idexx Labs (IDXX), Repligen (RGEN), Dexcom (DXCM), Thermo Fisher Scientific (TMO), Intuitive Surgical (ISRG) and PerkinElmer. It's not clear why such an array of biotechs and medical product and systems makers would all be hard hit. A New York state mandate requires that over 665,000 workers in hospitals and nursing homes have at least one vaccine dose by midnight Monday or lose their jobs.

Meanwhile, a number of tech names fell hard, especially in software. Cloudflare (NET) tumbled 5.8% to essentially its 50-day line.

Among the best ETFs, the Innovator IBD 50 ETF (FFTY) slumped 2.3%, while the Innovator IBD Breakout Opportunities ETF (BOUT) dipped 0.25%. The iShares Expanded Tech-Software Sector ETF (IGV) retreated 1.7%. The VanEck Vectors Semiconductor ETF (SMH) gave up 0.4%, with AMD stock a major SMH component.

SPDR S&P Metals & Mining ETF (XME) popped 3.5% and Global X U.S. Infrastructure Development ETF (PAVE) advanced 1.2%. U.S. Global Jets ETF (JETS) edged up 0.7%. SPDR S&P Homebuilders ETF (XHB) climbed 0.8%. The Energy Select SPDR ETF (XLE) jumped 3.6%. The Financial Select SPDR ETF (XLF) rose 1.4%, with JPM stock a major holding.

Reflecting stocks with more speculative stories, the ARK Innovation ETF (ARKK) dipped 0.1% and ARK Genomics (ARKG) fell 0.5%. Rising Tesla stock is the top holding across Ark Invest ETFs, but they've generally struggled over the past few months.

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Five Best Chinese Stocks To Watch Now

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Tesla Stock

Tesla rose 2.2% to 791.36, extending Friday's breakout and clearing the April short-term high of 780.79. Shares are still in range from a 764.55 handle buy point, with the 5% chase zone rising to 802.78. Volume has been strong the past two sessions.

The relative strength line for Tesla stock, though still well off its January peak, is at a five-month high. The RS line, the blue line in the charts provided, tracks a stock's performance vs. the S&P 500 index.

The only negative in the TSLA stock chart was the lack of a real shakeout. Shares have risen for five straight weeks, though not at such a blistering pace that a pullback or pause seems almost inevitable.

On Friday night, Tesla let Full Self-Driving owners and subscribers opt in to FSD Beta. But first Tesla will monitor their driving for seven days. That means FSD Beta could expand to a far wider pool of drivers starting on Friday, Oct. 1. Meanwhile, Tesla could report third-quarter deliveries as early as Friday or as late as next Tuesday.

AMD Stock

AMD stock staged an upside reversal, climbing 2.2% to 108.16 on Monday, rising from its 50-day line and decisively breaking a trendline. Volume was below average, but was the heaviest in several weeks. AMD is working toward a 114.59 double-bottom buy point.

Whiting Stock

WLL stock rose 6.1% to 59.49, clearing a 57.69 buy point from a cup base. The RS line for Whiting stock is at a new high on the breakout, a bullish sign. WLL stock returned to public markets in September 2020, following a bankruptcy earlier in the year.

Targa Stock

TRGP stock jumped 4.3% to 49.46, just topping a 49.30 buy point from a cup base, according to MarketSmith analysis. Targa Resources delivers natural gas and natural gas liquids. Natural gas prices are rising sharply in the U.S. and are white-hot in Europe.

JPMorgan Stock

JPM stock rose 2.4% to 166.98, breaking out of a cup-with-handle base and racing past its 163.93 buy point in volume that was slightly above normal. JPMorgan stock has rallied for five straight sessions, reclaiming its 50-day line and breaking a trendline last Thursday.

MGM Stock

MGM stock rose just over 1% to 45.09, staying within a buy zone that runs to 46.06. The casino giant cleared a 43.87 cup-with-handle base last Thursday after closing slightly below that entry on Wednesday. On Monday, MGM agreed to buy The Cosmopolitan hotel and casino for $1.6 billion from Blackstone (BX).

Hilton Stock

HLT stock climbed 2.45% to 138.80, rising above a 136.99 cup-base buy point, though in below-average volume. Arguably the best time to buy Hilton stock was on Thursday, when it cleared an almost-handle in heavy volume. The RS line for Hilton stock isn't quite at a new high, but is at a consolidation peak and a six-month best.

Market Rally Analysis

The stock market rally had an OK session. The Nasdaq and S&P 500 retreated, but found support at the 50-day line following the strong recovery last week. Meanwhile, the Dow Jones hit resistance at its 50-day line, but at least it's trying to get above that key level after several weeks. The Russell 2000 simply had a very strong day after reclaiming its 50-day and 200-day lines last week.

Growth stocks retreated Monday, partly due to the continued rise in the 10-year Treasury yield. The FFTY ETF showed real resilience in the past couple of weeks after racing to record highs.

Meanwhile, rising Treasury yields and energy prices pushed up the Dow Jones and Russell 2000.

A partial government shutdown or an infrastructure bill defeat could upset the market, but how much would depend on how long the impasse goes on.

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Time The Market With IBD's ETF Market Strategy

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What To Do Now

Monday's mixed market rally and the retreat in growth stocks showed why investors shouldn't get too exposed, especially to a particular sector. That said, a lot of sectors have been working, though not necessarily all on the same day.

Continue to grade your stocks. Are you in sync with the market rally? That doesn't mean all your stocks outperform every day. But are you generally in the right stocks and sectors? If not, you may want to exit some positions and reorient your portfolio, making sure you don't chase extended stocks.

Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.

Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.

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China Power Outages Close Factories and Threaten Growth - The New York Times

High demand and soaring energy prices have forced some factories to shut down, adding further problems for already snarled global supply chains.

DONGGUAN, China — Power cuts and even blackouts have slowed or closed factories across China in recent days, adding a new threat to the country’s slowing economy and potentially further snarling global supply chains ahead of the busy Christmas shopping season in the West.

The outages have rippled across most of eastern China, where the bulk of the population lives and works. Some building managers have turned off elevators. Some municipal pumping stations have shut down, prompting one town to urge residents to store extra water for the next several months, though it later withdrew the advice.

There are several reasons electricity is suddenly in short supply in much of China. More regions of the world are reopening after pandemic-induced lockdowns, greatly increasing demand for China’s electricity-hungry export factories.

Export demand for aluminum, one of the most energy-intensive products, has been strong. Demand has also been robust for steel and cement, central to China’s vast construction programs.

As electricity demand has risen, it has also pushed up the price of coal to generate that electricity. But Chinese regulators have not let utilities raise rates enough to cover the rising cost of coal. So the utilities have been slow to operate their power plants for more hours.

In the city of Dongguan, a major manufacturing hub near Hong Kong, a shoe factory that employs 300 workers rented a generator last week for $10,000 a month to ensure that work could continue. Between the rental costs and the diesel fuel for powering it, electricity is now twice as expensive as when the factory was simply tapping the grid.

“This year is the worst year since we opened the factory nearly 20 years ago,” said Jack Tang, the factory’s general manager. Economists predicted that production interruptions at Chinese factories would make it harder for many stores in the West to restock empty shelves and could contribute to inflation in the coming months.

Three publicly traded Taiwanese electronics companies, including two suppliers to Apple and one to Tesla, issued statements on Sunday night warning that their factories were among those affected. Apple had no immediate comment, while Tesla did not respond to a request for comment.

It is not clear how long the power crunch will last. Experts in China predicted that officials would compensate by steering electricity away from energy-intensive heavy industries like steel, cement and aluminum, and said that might fix the problem.

State Grid, the government-run power distributor, said in a statement on Monday that it would guarantee supplies “and resolutely maintain the bottom line of people’s livelihoods, development and safety.”

Still, nationwide power shortages have prompted economists to reduce their estimates for China’s growth this year. Nomura, a Japanese financial institution, cut its forecast for economic expansion in the last three months of this year to 3 percent, from 4.4 percent.

A power generator at a shoe factory in Dongguan. The rental and fuel costs make electricity from the device twice as expensive as when the factory was simply tapping the grid.Gilles Sabrié for The New York Times

The electricity shortage is starting to make supply chain problems worse. The sudden restart of the world economy has led to shortages of key components like computer chips and has helped provoke a mix-up in global shipping lines, putting in the wrong places too many containers and the ships that carry them.

Power supplies are little different. Compared with last year, electricity demand is growing this year in China at nearly twice its usual annual pace. Swelling orders for the smartphones, appliances, exercise equipment and other manufactured goods that China’s factories churn out has driven the rise.

China’s power problems are contributing in some part to higher prices elsewhere, like in Europe. Experts said that a surge in prices in China had drawn energy distributors to send ships laden with liquefied natural gas to Chinese ports, leaving others to scurry for further sources.

But the bulk of China’s power problems are unique to the country.

Two-thirds of China’s electricity comes from burning coal, which Beijing is trying to curb to address climate change. Coal prices have surged along with demand. But because the government keeps electricity prices low, particularly in residential areas, usage by homes and businesses has climbed regardless.

Faced with losing more money with each additional ton of coal they burn, some power plants have closed for maintenance in recent weeks, saying that this was needed for safety reasons. Many other power plants have been operating below full capacity, and have been leery of increasing generation when that would mean losing more money, said Lin Boqiang, dean of the China Institute for Energy Policy Studies at Xiamen University.

A workshop producing shoe parts in Dongguan. Prices for the components have already increased by 30 to 50 percent this year compared with last year.Gilles Sabrié for The New York Times

China’s main economic planning agency, the National Development and Reform Commission, also ordered 20 large cities and provinces in late August to reduce energy consumption for the rest of the year. The regulators cited a need to make sure that the cities and provinces met full-year targets set by Beijing for their carbon dioxide emissions from the burning of fossil fuels.

Besides coal, hydroelectric dams supply much of the rest of China’s power, while wind turbines, solar panels and nuclear power plants play a growing role.

China’s difficulty in keeping the lights on and the faucets running poses a challenge for Xi Jinping, the country’s top leader, and the Chinese Communist Party. They have taken a triumphalist stance this year, emphasizing China’s success in quickly eliminating outbreaks of the coronavirus and in winning the release of a senior Huawei executive, Meng Wanzhou, in a dispute with the United States and Canada.

But Mr. Xi risks getting tagged for problems as well as successes. He has moved strongly to quell any opposition within the Communist Party and has extended its reach into more sectors of Chinese life. If people in China begin to point fingers, there are few others to blame.

China’s economic rebound from the coronavirus has been driven in large part by heavy investment in infrastructure as well as the rise in exports. Overall industrial use consumes 70 percent of the electricity in China, led by the mostly state-owned producers of steel, cement and aluminum.

“If those guys produce more, it has a huge impact on electricity demand,” Professor Lin said, adding that China’s economic minders would order those three industrial users to ease back.

Disruptions from power shortages have already been felt in Dongguan, a city at the heart of China’s southern manufacturing belt. Its factories produce everything from electronics to toys to sweaters.

The local power transmission authority in Houjie, a township in northwestern Dongguan, issued an order shutting off electricity to many factories from Wednesday through Sunday. On Monday morning, the suspension in industrial electricity service was extended at least through Tuesday night.

Air-conditioners outside a worker dormitory in Dongguan. Factories in the city produce everything from electronics to toys to sweaters.Gilles Sabrié for The New York Times

The throaty roar of huge diesel generators rumbled on Monday morning through the streets and alleys of Houjie, where scores of five-story, concrete-walled factories are nestled among low-rise apartment buildings for migrant workers. Air-conditioners were not running as temperatures climbed into the 90s, and only a few fluorescent lights gleamed in some of the factories’ windows.

One of the noisy generators rumbled in a 20-foot yellow shipping container behind a factory where workers in bright blue and orange jumpsuits labored to assemble men's and women’s leather shoes for American and European buyers.

Mr. Tang, the general manager, said his factory already faced especially strict power usage rules because it had been labeled by the government a “low-profit, high-energy-consuming factory.”

Along nearby alleys, a warren of small workshops was making insoles and other shoe components for assembly at Mr. Tang’s factory and other similar plants nearby. Prices for the components have already increased by 30 to 50 percent this year compared with last year as labor costs and raw material prices rise, Mr. Tang said.

“Many of us working in this line of business say that we are basically losing money this year,” he said at his factory on Monday morning, adding that power outages began this past summer.

Mr. Tang had to turn off his generator for two days last week after local residents filed noise complaints with the local government. He also rented a metal cage to cover the generator to reduce the din.

Some in the neighborhood, particularly shoe component manufacturers, were sympathetic, voicing a mixture of business pragmatism and nationalism.

“Although it’s a bit noisy, I understand it,” said Wang Weidong, the owner of a shoe insole processing workshop. “There’s no other way — we will answer the call of the country.”

Li You contributed research.

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China Power Outages Close Factories and Threaten Growth - The New York Times
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