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    Stocks making the biggest moves midday: Domino’s Pizza, Lucid, Nvidia, Nikola and more

    Courtesy: Lucid Motors

    Check out the companies making headlines in midday trading.
    Nvidia — The chip stock spiked 14% after Nvidia topped expectations on the top and bottom lines in its most recent quarter. Wall Street analysts approved of the results, saying AI opportunities will drive growth for the chipmaker.

    Lucid Group — The electric vehicle maker tumbled 11.9% after posting fourth-quarter revenue that fell short of analysts’ expectations. Bank of America also downgraded the stock to neutral from a buy rating, citing near-term demand concerns.
    Bumble — Shares added 7.5% after Bumble beat fourth-quarter revenue expectations. However, the company posted a quarterly loss of 85 cents per share, a figure that included an impairment charge from shutting down operations in Russia and Belarus.
    Mosaic Company — Shares of the fertilizer mineral company added about 2.6% on Thursday after Mosaic’s quarterly revenue came in higher than expected. The company generated $4.48 billion in revenue, while analysts surveyed by StreetAccount were expecting $4.17 billion revenue. Mosaic’s adjusted earnings per share did miss expectations, but the company said it expected a “recovery in demand for fertilizers” this year.
    Lordstown Motors — Shares of the electric vehicle maker slid nearly 11.4% after the company announced a production and delivery pause to address quality issues with certain Endurance components. Lordstown will also voluntarily recall 19 Endurance pickups to address a “specific electrical connection issue that could result in a loss of propulsion while driving.”
    Domino’s Pizza, Papa John’s International — The pizza chains fell 11.7% and 6.1%, respectively, after they reported mixed earnings. Domino’s revenue and same-store sales missed analyst estimates, while its adjusted earnings per share beat. Papa John’s beat on both earnings and revenue, but missed estimates on North American company-owned restaurant sales.

    Nikola — Shares fell about 5.6% after Nikola reported quarterly revenue that disappointed analyst expectations. The electric truck maker said it delivered just 20 battery-electric trucks to dealers despite producing 133 trucks in the fourth quarter.
    eBay — Shares dropped 5.2% even after eBay reported fourth-quarter earnings that missed expectations. The online seller of goods posted a profit of 77 cents per share, below the Refinitiv estimate of 81 cents per share.
    Alibaba Group — Shares fell nearly 0.7% even after the Chinese e-commerce giant’s fiscal third-quarter earnings beat analyst estimates. Earnings per American depository receipt share came in at 46.82 billion yuan, versus the 34.02 billion yuan expected. Revenue was 247.76 billion Chinese yuan ($35.92 billion), topping estimates of 245.18 billion Chinese yuan.
    Moderna — The pharmaceutical stock fell 6.7% after Moderna reported weaker-than-expected earnings for the fourth quarter, citing rising costs from surplus production capacity and lower demand for its Covid-19 vaccine.
    — CNBC’s Michelle Fox, Tanaya Macheel, Jesse Pound and Samantha Subin contributed reporting

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    Nikola’s fourth-quarter revenue falls short as it delivers just 20 trucks

    Nikola said Thursday it produced 133 battery-electric trucks in the fourth quarter, but delivered just 20 to dealers.
    The electric heavy-truck maker generated revenue that fell well short of Wall Street’s expectations.
    Nikola said it made a series of changes to its battery-electric truck during the quarter in response to feedback from early customers.

    Nikola Motor Company
    Source: Nikola Motor Company

    Electric heavy-truck maker Nikola said Thursday it produced 133 battery-electric trucks in the fourth quarter, but delivered just 20 to dealers, generating revenue that fell well short of Wall Street’s expectations.
    Nikola said it made a series of changes to its battery-electric truck during the quarter in response to feedback from early customers. The company also confirmed that the fuel-cell version of its truck is still on track to begin production in the second half of 2023, in line with earlier guidance.

    The stock fell more than 5% Thursday.
    Here are the key numbers from Nikola’s fourth-quarter earnings report, compared with Refinitiv consensus estimates:

    Adjusted loss per share: 37 cents vs. 43 cents expected
    Revenue: $6.6 million vs. $32.1 million expected

    Nikola’s fourth-quarter net loss was $222.1 million, or 46 cents per share. The truck maker lost $159.4 million, or 39 cents per share on a GAAP basis, in the year-ago period.
    As of Dec. 31, Nikola had $233.4 million in cash and equivalents available, down from $315.7 million at the end of September.
    Nikola’s fourth-quarter production brought it to 258 trucks built in 2022. That was just enough to hit the guidance range it provided in November, when it said it expected to produce between 255 and 305 trucks for the full year.

    Production should ramp up somewhat in 2023. Nikola said investors should expect it to deliver between 250 and 350 battery-electric trucks and 125 to 150 of its upcoming fuel-cell trucks this year. The company also expects to reduce costs on its battery-electric trucks by about $105,000 per truck by year-end as it realizes savings from its acquisition of battery-pack maker Romeo Power.
    This is breaking news. Please check back for updates.

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    Lordstown halts production, shipments of Endurance electric trucks to address quality issues

    Lordstown Motors said Thursday it will suspend production and deliveries of its all-electric Endurance pickup to address performance and quality issues with certain components.
    The automaker also will voluntarily recall 19 Endurance pickups to address a “specific electrical connection issue that could result in a loss of propulsion while driving.”
    Shares of Lordstown were down in early trading Thursday.

    Lordstown Motors gave rides in prototypes of its upcoming electric Endurance pickup truck on June 21, 2021 as part of its “Lordstown Week” event.
    Michael Wayland / CNBC

    Lordstown Motors said Thursday it will suspend production and deliveries of its all-electric Endurance pickup to address performance and quality issues with certain components.
    The electric vehicle startup, which partnered with Foxconn for vehicle production at an Ohio plant, said the team is working with suppliers on the root cause analysis of each issue and potential solutions, which “in some cases may include part design modifications, retrofits, and software updates.”

    The automaker also will voluntarily recall 19 Endurance pickups to address a “specific electrical connection issue that could result in a loss of propulsion while driving.” Lordstown said it is working with suppliers to implement a solution that the company believes will address the issue.
    Shares of Lordstown, which went public via a special purpose acquisition company in 2020, fell 11% to $1.09 on Thursday. It’s a far cry from the stock’s all-time high of $31.80 a share in September 2020.
    Colleen Robar, a spokeswoman for Lordstown, said the company is unaware of any injuries associated with the recalled vehicles. She declined to disclose how many vehicles in total the company has produced and delivered to customers since production started in September.
    As of Jan. 3, the company had produced 31 vehicles for sale and delivered six of those to customers, Lordstown said in a regulatory filing last month.
    Robar confirmed the problems have not resulted in any fires, like a battery issue earlier this month with an electric Ford F-150 Lightning pickup.

    “While our experienced team has made significant progress in addressing the underlying component and vehicle sub-system issues affecting the Endurance build schedule, we remain committed to doing the right thing by our customers and to resolve potential issues before resuming production and customer shipments,” said Lordstown CEO Edward Hightower said in a release.
    The company declined to forecast how long production will be idled at the Ohio plant, which Lordstown purchased from General Motors in 2019.
    The company plans to provide a more detailed update on the status of these issues on its upcoming earnings call on March 6.
    The recall and production problems add to a long list of issues at Lordstown since the company went public nearly 2½ years ago. It has been plagued by management, production and execution issues.
    Automakers routinely have issues and recalls associated with vehicles but problems with EVs, specifically batteries, are of particular concern and interest, as the automakers invest billions of dollars in the vehicles.

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    Feds point to overheated wheel bearing in report on Ohio train derailment

    Federal authorities on Thursday pointed to an overheated wheel bearing on a Norfolk Southern train that derailed and released toxic chemicals in East Palestine, Ohio.
    The preliminary report from the National Transportation Safety Board did not offer an exact cause of the derailment but outlined several operational concerns.
    According to the report, the train was traveling about 47 miles per hour at the time of the derailment, below the speed limit of 50 miles per hour.

    Workers continue to clean up remaining tank cars, Tuesday, Feb. 21, 2023, in East Palestine, Ohio, following the Feb. 3 Norfolk Southern freight train derailment.
    Matt Freed | AP

    Federal authorities on Thursday pointed to an overheated wheel bearing on a Norfolk Southern train that derailed and released toxic chemicals earlier this month in Ohio.
    The preliminary report from the National Transportation Safety Board did not offer an exact cause of the East Palestine, Ohio, derailment but outlined several operational concerns.

    “Surveillance video from a local residence showed what appeared to be a wheel bearing in the final stage of overheat failure moments before the derailment,” the report said. “The wheel bearing and affected wheelset have been collected as evidence and will be examined by the NTSB.”
    In a press conference Thursday afternoon, National Transportation Safety Board Chairwoman Jennifer Homendy said “it was the combination of the hot axle and the plastic pellets which started the initial fire.”
    Homendy said roller bearings typically have a finite life of between 100,000 and 300,000 miles. Overheating in roller bearings could stem from fatigue cracking, water damage, mechanical damage, a loose bearing or a wheel defect.
    “It is recognized in the railway industry that wheel set roller bearings can fail catastrophically in as few as 10 to 15 miles on a train traveling at track speed,” Homendy said. “You cannot wait until they fail. Problems need to be identified thoroughly so something catastrophic like this does not occur again. This of course was much earlier than 10 to 15 miles, so we’re going to look at that.”
    Future investigative activity will focus on the wheelset and bearings, tank car design and maintenance procedures, derailment damage, inspection practices and a review of the accident response, the NTSB said.

    At about 9 p.m. local time on Feb. 3, an eastbound Norfolk Southern freight train derailed, including 11 tank cars carrying hazardous materials that subsequently ignited. These chemicals included vinyl chloride, a highly flammable carcinogen. Thirty-eight railcars derailed in the incident, according to the NTSB report.
    According to the report, the train was traveling about 47 miles per hour at the time of the derailment, below the speed limit of 50 miles per hour. The train’s positive train control system, in place to prevent over-speed derailments, was operating at the time of the derailment.
    After the train passed a wayside defect detector, it transmitted an alarm message instructing the crew to stop the train to inspect the hot axle. The Norfolk Southern train was equipped with a hot bearing detector system, designed to detect overheated bearings. These detectors are located on the ground pointing up, using infrared technology. NTSB has not identified any operational issues with the wayside defect detectors, nor any track defects.
    However, authorities noted a shorter distance between sensors may have helped.
    “Had there been a detector earlier, that derailment may not have occurred. But that’s something we have to look at,” Homendy said.
    At the time the train was instructed to stop, the bearing’s temperature recorded a temperature of 253 degrees hotter than ambient temperatures, above a threshold of 200 degrees at which point temperatures are considered critical, according Norfolk Southern criteria. At the previous detector, it recorded a temperature of 103 degrees above ambient temperatures. The report said temperatures between 170 to 200 degrees require a stop. Each train company creates their own thresholds, Homendy said, though the NTSB will investigate if warning thresholds need to be changed.
    “We have no evidence that the crew did anything wrong,” Homendy said.
    Homendy said there are federal regulations stating that train cars need to be able to be cooled for 100 minutes, though the fire lasted for well longer than 100 minutes. This means the train car’s insulation kept the cars from cooling.
    A one-mile evacuation zone was implemented after the derailment, impacting up to 2,000 residents.
    Two days after the derailment, temperatures continued to rise within five of the derailed tank cars carrying 115,580 gallons of vinyl chloride. Due to the possibility of a catastrophic explosion that could have sent shrapnel up to a mile, Norfolk Southern carried out a controlled release three days later. The NTSB had no role in the decision making or carrying out of the vent and burn.
    No fatalities or injuries were reported.
    Homendy said the NTSB will hold a rare investigative field hearing in the spring in East Palestine to collect information from witnesses and discuss possible solutions.
    “We’ve never seen an accident that isn’t preventable,” Homendy said. “I don’t like the word accident, I hate to use it. Nothing is an accident.”

    Working on cleanup

    Norfolk Southern CEO Alan Shaw told CNBC in an interview that aired Tuesday he believes it’s safe for families to return to East Palestine. Officials reported air levels are safe and the town’s water is free of harmful levels of contaminants.
    “Our focus right now is on environmental remediation, cleaning up this site, continual air monitoring, water monitoring, financial assistance to the residents of this community, and investing in this community so that the community in East Palestine can thrive,” Shaw said.
    However, residents continue to express skepticism. Ohio opened a health clinic Tuesday to address growing reports on headaches, nausea and rashes in the community, and some residents have reported dead chickens and fish near the site. A number of residents who fled their homes have sued Norfolk Southern.
    On Tuesday, the Environmental Protection Agency ordered Norfolk Southern to handle and pay for all cleanup efforts.

    Shaw told CNBC that Norfolk Southern has reimbursed or committed $6.5 million to East Palestine and will continue to provide financial assistance to residents.
    The town has become a political hotspot after former President Donald Trump, a Republican, paid a visit on Wednesday to meet with first-responders and local elected officials. Trump, who won Ohio in 2016 and 2020, suggested that the Biden administration had shown “indifference and betrayal” in responding to the crisis — in addition to promoting his name-brand water.
    Trump did not mention on Wednesday his administration in 2018 scrapped a 2015 Obama-era rule mandating advanced braking technology on trains transporting hazardous or flammable materials.
    The Thursday report comes the same day that Transportation Secretary Pete Buttigieg visited the site. Buttigieg sent a letter Sunday to Norfolk Southern, warning that the company must “demonstrate unequivocal support for the people” of East Palestine.
    Buttigieg has drawn criticism from Republican politicians for his response to the crisis. Sen. Marco Rubio, R-Fla., has called on Buttigieg to resign or be fired for “a gross level of incompetence and apathy.” Buttigieg acknowledged in a CBS News interview Tuesday that he “could have spoken sooner about how strongly I felt about this incident.”
    In the press conference, Homendy said this investigation is “not about politics” and that the goal is to issue safety recommendations guided by facts.
    “This is a community that has been devastated,” she said. “They deserve to know what happened, how to prevent it from happening again. They deserve to have the right solutions.”

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    Jamie Dimon says the Federal Reserve has ‘lost a little bit of control of inflation’

    JPMorgan Chase CEO Jamie Dimon said Thursday that containing inflation remains a work in progress for the Federal Reserve, while noting the U.S. economy continues to show signs of strength.
    “I have all the respect for [Fed Chair Jerome] Powell, but the fact is we lost a little bit of control of inflation,” Dimon said in an interview with CNBC’s Jim Cramer during the “Halftime Report.” It’s the first of a two-part interview with Cramer, with the second installment airing later Thursday on “Mad Money.”

    Dimon’s comments came one day after the Fed released the minutes from its Jan. 31-Feb.1 meeting, which showed members remain resolved to fight persistent inflation.
    “Participants noted that inflation data received over the past three months showed a welcome reduction in the monthly pace of price increases but stressed that substantially more evidence of progress across a broader range of prices would be required to be confident that inflation was on a sustained downward path,” the minutes said.
    Dimon himself said he expects that interest rates could “possibly” remain higher for longer, as it may take the central bank “a while” to get to its goal of 2% inflation.
    Even so, the JPMorgan CEO said he’s not currently breaking out the recession playbook, as he is encouraged by the strength of the U.S. economy.
    “The U.S. economy right now is doing quite well. Consumers have a lot of money. They’re spending it. Jobs are plentiful,” Dimon said. “That’s today. Out in front of us, there’s some scary stuff. You and I know there’s always uncertainty. That’s a normal thing.”

    Those comments contrast with Dimon’s previous remarks in October. At that time, he said the U.S. economy will likely fall into a recession in six to nine months. In December, he said higher inflation was eroding consumer wealth, which would lead into a recession this year.
    The Fed declined to comment on the story.

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    Black families’ net worth has grown more than other racial groups since Covid, but wealth gap remains wide

    Gains for average net worth among Black households outpaced other racial groups during the pandemic, a new study showed.
    Because of their lower exposure to the stock market, Black Americans didn’t experience huge fluctuations in their equity holdings last year.
    The value of real estate holdings of Black individuals has risen by 72% since the end of 2019.
    Homeownership also rose among Black Americans during the pandemic as more buyers looked to take advantage of low mortgage rates.

    Getty Images

    Black families saw their wealth grow more than that of non-Black households during the pandemic, but the racial wealth gap is still vast, a new study showed.
    The average net worth among Black households rose to more than $340,000 through the third quarter of last year from the end of 2019, marking an increase of 32% over just 11 quarters, according to research from Wells Fargo using data from the Federal Reserve Board.

    While non-Black families had a much higher starting point at roughly $950,000 just before the onset of the pandemic, their wealth has risen just 21% over the same period, the Wells Fargo study showed. But even with the improvement, the racial wealth gap is still staggering: Black Americans’ net worth is 70% below that of non-Black households.

    Arrows pointing outwards

    “There’s been progress directionally, but there’s still a huge gap,” Jay Bryson, chief economist at Wells Fargo, said in an interview. “This is a step in the right direction, but there’s still a lot of progress that needs to be made here.”
    One factor contributing to the slight shrinking in the wealth gap is actually the fact that the assets of Black households are much less diversified.
    At the end of 2019, real estate and pension entitlements accounted for roughly 70% of Black household assets, whereas the assets of non-Black households were spread more evenly among six major classes, the study showed.

    Arrows pointing outwards

    Because of their lower exposure to the stock market, Black Americans didn’t experience huge fluctuations in their equity holdings amid the wild swings on Wall Street in 2022. The S&P 500 tumbled nearly 20% last year for its worst annual loss since 2008.

    “The good thing was Black families weren’t hit as bad because of that,” Bryson said. “The bad thing is they aren’t as diversified as what they probably should be, but it certainly did help at least in terms of last year. … It is a blessing in disguise.”
    Real estate boom
    Home prices soared during the pandemic as homebound people sought new places to live, boosted by record low interest rates. The value of real estate holdings of Black individuals has risen by 72% since the end of 2019, nearly doubling the gain experienced by non-Black individuals, the Wells study found. What’s more, lower-priced homes tend to have seen a bigger percentage increase.
    “What happened was home prices in general went up more among lower price points than they did upon higher price points,” Bryson said. “Given the income gap, Black families probably are going to be over represented in lower price points.”
    Meanwhile, homeownership also rose among Black Americans during Covid as more people looked to take advantage of low mortgage rates. The percentage of Black homeowners climbed to 44% in the third quarter of 2021 from 42.7% two years ago, which marked the largest percentage point increase in homeownership rates of any racial or ethnic group, the study showed.
    The U.S. housing market started to cool off after mortgage rates more than doubled from historic lows.
    A blip?
    Experts cautioned that just one study focusing on a short time frame might not represent a sustainable bridging of the racial wealth gap.
    “I don’t think it signifies any true bridging in racial wealth inequality,” Dedrick Asante-Muhammad, chief of organizing, policy and equity at National Community Reinvestment Coalition, said in an interview. “What we want to see is substantial homeownership increases, long-term home value increases, income and maybe in 401(k)s and stocks.”
    Meanwhile, any progress seen during recent years could be unwound if the economy is tipped into a recession on the back of aggressive rate hikes.
    “If we do have a recession this year, I think that’s going to reverse some of it,” Bryson said. “Historically, the gap between the Black and non-Black unemployment rate tends to rise as the economy enters recession.”

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    Rolls-Royce shares soar by 23% after annual results crush expectations

    Shares of FTSE 100-listed aviation manufacturer Rolls-Royce soared, after the company’s annual results sharply beat expectations.
    Rolls Royce recorded £652 million ($786 million) of underlying profit last year, £238 million higher than in 2021 — exceeding analyst forecasts near £478 million, as polled by Reuters.
    The company attributed the results to recovering demand for international travel.

    Rolls Royce Trent XWB engines, designed specifically for the Airbus A350 family of aircraft, are seen on the assembly line at the Rolls Royce factory in Derby, November 30, 2016.
    Paul Ellis | Reuters

    Shares of London-listed aviation manufacturer Rolls-Royce soared Thursday, after the company sharply beat expectations with a 57% year-on-year increase in underlying profit, driven by its civil aerospace and power systems.
    Its stock was up by 23% at roughly 1:30 p.m. London time. The company recorded £652 million ($786 million) of underlying profit last year, £238 million higher than in 2021 — exceeding analyst forecasts near £478 million, as polled by Reuters. Rolls-Royce’s free cash flow from continuing operations added £2 billion on the year to £505 million in 2022.

    The company attributed the results to recovering demand for international travel, noting a 35% year-on-year hike in large engine flying hours for civil aerospace. The aviation sector is recovering from the severe pressure suffered during the Covid-19 pandemic, when lockdowns and higher barriers to passenger entry choked international mobility.
    Rolls-Royce said it will make no shareholder payments for the 2022 financial year, but pledged to return to an investment grade credit rating and resume the practice, without specifying a timeline.
    The company is undergoing a transformation program to improve its performance in 2023, led by Tufan Erginbilgic — the former BP executive who succeeded Warren East in January. The program will include a strategic review, with Rolls-Royce set to announce its ensuing medium-term goals in the second half of this year.
    The company projects “a continued recovery in our end markets” and further increases to returns in 2023, issuing operating profit guidance between £0.8 billion and £1 billion and a fresh cash flow outlook of £0.6 to £0.8 billion.
    The surge brings Rolls-Royce shares in line with the Deutsche Bank analysts’ price target of £1.36.

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    Stocks making the biggest moves premarket: Lucid, Nvidia, Dollar General, Sunrun and more

    A sign is posted at the Nvidia headquarters on May 25, 2022 in Santa Clara, California.
    Justin Sullivan | Getty Images

    Check out the companies making headlines in early morning trading.
    Lucid Motors — The electric vehicle maker saw shares slide 14% premarket after reporting that fourth-quarter revenue fell short of expectations. Lucid said it built just 7,000 of its Air luxury sedans last year amid manufacturing challenges. Bank of America downgraded the shares Thursday, citing near-term demand concern.

    Nvidia – Shares of the chip giant leaped more than 9% in early trading after Nvidia posted beats Wednesday on the top and bottom lines for its latest quarter. Wall Street praised Nvidia’s results Thursday, calling AI opportunities the next big growth vector for the chipmaker.
    Dollar General — Shares fell about 5% after Dollar General reported preliminary results for its fourth-quarter and fiscal year 2022 that were lower than prior guidance and weaker than consensus expectations from FactSet.
    eBay — The online auction platform fell 5% despite posting fourth-quarter earnings and revenue that topped analysts’ estimates as gauged by Refinitiv. Earnings came in at $1.07 per share, but the company issued earnings guidance for the current quarter between $1.05 and $1.09 per share. Wall Street expects $1.06.
    Etsy — Shares of the e-commerce company jumped 5% following the company’s quarterly results. Etsy posted revenue of $807 million, smashing Refinitiv consensus estimates of $752 million. The company also forecast current quarter revenue of $600 million and $640 million, compared to estimates of $622 million.
    Bath & Body Works — Shares fell more than 4% after the company reported fourth-quarter earnings. The bath shop retail chain issued weaker-than-expected first-quarter and full-year guidance as measured by FactSet. Otherwise, it reported a beat on the top and bottom lines, according to consensus estimates from Refinitiv.

    Bumble — The online dating site rose more than 3% after it reported better-than-expected fourth quarter earnings and revenue. Bumble posted revenue of $191 million, above the $186 million estimate from analysts polled by FactSet. Revenue also exceeded analysts’ expectations, at $242 million versus estimates of $236 million.
    Mosaic — Shares of the fertilizer maker rose 2% after it reported fourth-quarter revenue of $4.48 billion that topped analysts’ estimates of $4.17 billion, according to FactSet. Earnings for the quarter fell short of estimates.
    Alibaba — The Chinese e-commerce giant rallied nearly 6% after its fiscal third-quarter results beat analyst estimates. Revenue was 247.76 billion Chinese yuan ($35.92 billion), versus the 245.18 billion Chinese yuan expected. Earnings per American depository share was 46.82 billion yuan compared to 34.02 billion yuan expected by analysts.
    Sunrun — The solar company rose 1.5% after its fourth-quarter earnings topped Wall Street’s expectations. Earnings per share were 29 cents, compared to 1 cent expected, per StreetAccount estimates. Its adjusted net income came in at $63 million, above the $37.3 million expected.
    Moderna — The drug maker announced with Merck that the Food and Drug Administration has granted them breakthrough status for a personalized cancer vaccine for patients with high-risk melanoma. Moderna rose more than 1%, and Merck rose less than 1%.
    Intel — Shares of the chip maker rose more than 1% after Morgan Stanley upgraded the stock to equal weight from underweight, after the company cut its dividend by about 60%. Speculation around the possibility of a dividend cut has weighed negatively on the stock, but Morgan Stanley said it’s “the right thing to do longer term” and that Intel has “limited downside” given its underperformance.
     — CNBC’s Sarah Min and Michelle Fox contributed reporting

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