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Lordstown Motors Stock Jumps Following Foxconn News

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© Reuters

By Sam Boughedda

Investing.com — Lordstown Motors (NASDAQ:RIDE) stock rallied in early Thursday trading following news it has completed a deal to sell some assets to Foxconn.

Shares of struggling EV maker Lordstown opened Thursday’s session at $1.85. At the time of writing, they are trading around the $1.77 mark, up more than 16% from Wednesday’s close.

Lordstown will sell its Ohio vehicle assembly plant to Foxconn (TW:2354) for $230 million, plus the reimbursement of certain operating and expansion costs from September 1, 2021, to the closing date. In total, the asset purchase agreement results in approximately $260 million in proceeds for Lordstown. 

The funds will help it begin production of its Endurance pickup truck. 

As part of the deal, Foxconn and Lordstown Motors have entered into a manufacturing supply agreement for the Endurance. 

They expect to start commercial production of the Endurance in the third quarter, with the first commercial deliveries scheduled in the fourth quarter. Foxconn will assume manufacturing operations at the Lordstown plant.

Furthermore, the companies have also entered into a joint venture agreement to co-develop future electric vehicles. The new joint venture will be 55% owned by Foxconn and 45% by Lordstown. 

“Our strategic partnership with Foxconn provides LMC with a flexible and less capital-intensive business model, access to broad supply chain and software capabilities and an effective vehicle development platform to bring EVs to market faster and more efficiently,” stated Daniel Ninivaggi, CEO of Lordstown Motors.

Stock Markets

Dow Futures Tick Lower After Wall Street Sell-off Intensifies

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© Reuters.

By Oliver Gray 

Investing.com – U.S. stock futures were trading lower during Wednesday’s evening deals, after major benchmark averages finished the regular session sharply lower, with the Dow Jones Industrial Average posting its biggest loss since 2020 after retail earnings indicated rising inflation pressures weighing on corporate profits.

By 6:42pm ET (10:42pm GMT) Dow Jones Futures and S&P 500 Futures were each trading 0.1% lower while Nasdaq 100 Futures fell 0.2%.

In extended deals, Cisco Systems Inc (NASDAQ:CSCO) dipped 12.9% after results as the as the company forecasted a surprising decline in revenue for the current quarter. Q3 EPS came in at 87 cents versus 86 cents expected while revenue came in at $12.8 billion versus estimates of $13.34 billion.

Bath & Body Works Inc. (NYSE:BBWI) fell 6% after reporting, as the company forecasted lower-than-expected second-quarter earnings. Q1 EPS of 64 cents versus 53 cents expected on revenues of $1.45 billion versus $1.44 billion expected.

Synopsys Inc (NASDAQ:SNPS) gained 3.5% as the company reported Q2 EPS of $2.50 versus $2.37 expected on revenues of $1.28 billion versus estimates of $1.26 billion.

During Wednesday’s regular trade, the Dow Jones Industrial Average shed 1,164.52 points, or 3.57%, to close at 14-month lows of 31,490.07 and posting its largest daily losses since June 2020. The S&P 500 traded 4.04% lower to 3,923.68 while the NASDAQ Composite dropped 4.73% to 11,418.15.

Among stocks, Target Corporation (NYSE:TGT) shares tumbled 24.9% Wednesday after the retailer reported first-quarter earnings that were much lower than Wall Street estimated due to rising costs for fuel and compensation.

Major tech companies were also hit amid the sell-off with Block Inc (NYSE:SQ) down 3.2%, Amazon.com Inc (NASDAQ:AMZN) falling 7.2%, Microsoft Corporation (NASDAQ:MSFT) dipping 4.8% and Apple Inc (NASDAQ:AAPL) down 5.6%.

On the bond markets, United States 10-Year rates were at 2.884%.

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Stock Markets

New York Times pauses return to office for workers

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© Reuters. FILE PHOTO: The New York Times building is seen in Manhattan, New York, U.S., August 3, 2020. REUTERS/Shannon Stapleton

(Reuters) – The New York Times Co said on Wednesday it is pausing its plan to ask employees to return to office as COVID-19 cases rise in the United States.

Employees of the company, headquartered in New York City, were previously set to return to office in June.

The United States is averaging nearly 97,000 new cases a day, up from about 73,000 a week ago, according to a Reuters tally, with New York City raising its COVID-19 alert level to high on Tuesday.

“Based on the city’s guidance and the advice of our health experts, we are pausing the start of our Expected Phase of return to office until conditions improve,” the company said in a note sent to its staff.

The company also said it strongly recommends that employees wear masks in common areas at its facilities, including elevators, meeting rooms, restrooms and pantries, where social distancing is not possible

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Hedge fund Melvin Capital tells investors it plans to shut down -letter

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2/2

© Reuters. FILE PHOTO: A Wall Street sign is pictured outside the New York Stock Exchange in New York, October 28, 2013. REUTERS/Carlo Allegri

2/2

By Svea Herbst-Bayliss

(Reuters) – Hedge fund manager Gabe Plotkin, who boasted one of Wall Street’s best investing records, on Wednesday told investors that he is shutting down his firm, Melvin Capital, after it suffered billions of dollars in losses.

“The appropriate next step is to wind down the Funds by fully liquidating the Funds’ assets and accounts and returning cash to all investors,” Plotkin wrote in a letter reviewed by Reuters on Wednesday.

Melvin Capital had $7.8 billion in assets at the end of April and the fund had lost 23% since January, a person familiar with the fund’s finances said.

This year’s losses come on the heels of steep losses in 2021 when Melvin Capital ended the year down 39%. The firm bet that shares of GameStop (NYSE:GME) would tumble but was battered when retail investors took the other side and sent the stock surging.

The firm had $12.5 billion in assets at the start of 2021.

In the letter Plotkin said he had already raised a substantial amount of cash and cut the funds’ exposure.

A spokesman for Plotkin declined to comment.

At the end of the first quarter Melvin’s biggest investments included bets on Live Nation Entertainment (NYSE:LYV), Hilton Worldwide Holdings (NYSE:HLT), Amazon (NASDAQ:AMZN) and Datadog (NASDAQ:DDOG). Their stock prices have fallen sharply in the last weeks, sparking speculation that a hedge fund might be trying to unwind positions.

Plotkin was a star investor at Steven A. Cohen’s hedge fund SAC Capital Advisors and launched his own firm after SAC pleaded guilty to criminal insider trading charges. Melvin Capital quickly attracted attention and powerful investors and ended 2020, the year the pandemic began, with gains of 52.5%.

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