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    Biden's infrastructure plan will bolster the U.S. semiconductor industry, Commerce Secretary says

    In this articleFThe White House’s infrastructure plan will put the U.S. on more equal footing with China as it bolsters the American semiconductor industry, Commerce Secretary Gina Raimondo said Wednesday.”This is about out-competing China,” Raimondo told CNBC’s Jim Cramer in a “Mad Money” interview. “If we act now … we will compete with China. There is time to do that, to rebuild, to build in semiconductors in particular, but we have to get to the business of doing it.”The comments came moments after President Joe Biden unveiled a $2 trillion package primarily tailored to bridges, roads and other transportation initiatives. The proposal also calls for a $50 billion investment in semiconductor manufacturing and research.A global chip shortage, heightened by high demand for computers and other technological products during the coronavirus pandemic, has pressured American manufacturers. For instance, Ford announced Wednesday it will reduce car production at multiple North American plants due to the low supply for semiconductors.Raimondo, who left the Rhode Island governor’s house to join the Biden administration, said semiconductors are the “building blocks of a future economy and a digital economy.” With investments in semiconductor manufacturing, it will pave a way for basic research, more jobs in foundries, job training and advanced manufacturing, she said.”I am hopeful that when the business community, large and small, has an opportunity to look into this package, they’ll see this is about competing and winning now and into the future, and that’s good for business and good for workers,” she said.The Biden administration is aiming to get an infrastructure bill passed by this summer. Named “The American Jobs Plan,” it includes spending to combat climate change, improve drinking-water infrastructure, expand broadband access and lay the groundwork for electric vehicle capabilities.The package could face some hurdles in Congress, despite Democrats’ power advantage. Democrats hold a slight majority in the House and a 50-50 tiebreaker in the Senate. However, Republicans are gearing up to object over the package’s size and the White House’s plan to pay for it.Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer’s world? Hit him up! Mad Money Twitter – Jim Cramer Twitter – Facebook – InstagramQuestions, comments, suggestions for the “Mad Money” website? [email protected] More

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    Lean into value names and trim tech positions as second quarter kicks off, Wilmington Trust says

    In this article.IXICHYDXLFXLIXLBXLEXLKKREUS10YWilmington Trust’s Meghan Shue expects growth stocks, including Big Tech, to hit more turbulence over the next three months.”Our main takeaway was to lean a little bit more into value and trim some of our growth exposure,” Shue, the firm’s head of investment strategy, told CNBC’s “Trading Nation” on Wednesday. She helped build her firm’s second-quarter strategy, which embraces value and cyclical stocks.On the first quarter’s final day, the tech-heavy Nasdaq Composite rallied more than 1.5%. Year to date, it’s up nearly 3%. However, the index is off almost 7% away its all-time high.”We are not adding to equities today, but we are rotating underneath the surface to take advantage of some changing dynamics in market leadership,” she said.Overall, the firm is sticking to an overweight to stocks. Her playbook’s top picks include S&P 500 groups highly leveraged to the economic rebound: financials, industrials, materials and energy, which was the first quarter’s best performing S&P 500 group. Energy surged 29% in that time period.”We expect economic growth to accelerate very rapidly over the next few months and into the end of the year,” said Shue, who oversees almost $136 billion in assets and is a CNBC contributor.However, Shue warned that a lot of the good news may already be priced into the market.”I wouldn’t be terribly surprised to see the equity market pause a bit,” she said. “Going forward, it’s going to be a question of how much can the economy surprise to the upside, and how does an evolving policy backdrop impact the earnings and profitability of companies going forward?”Shue sees higher interest rates as headwinds for groups like growth and technology. But higher rates are also a major reason why she lists financials — particularly regional banks — as her favorite value trade for the second quarter.”[They’re] more tied to higher interest rates and a steepening yield curve,” Shue noted.In addition to stocks, she’s also overweight to high yield municipal bonds and commodities based on the notion that inflation will pick up over the next 12 months.”We definitely think that we are at the cusp of an inflection point in the economic growth trajectory,” Shue said.Disclaimer More

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    WHO warns of a rise in Covid cases and deaths: ‘We’re all struggling’

    Director-General of World Health Organization (WHO) Tedros Adhanom Ghebreyesus takes part to a news conference after a meeting of the International Health Regulations (IHR) Emergency Committee for Pneumonia due to the Novel Coronavirus 2019-nCoV in Geneva, Switzerland, January 22, 2020.Christopher Black | WHO | Handout via REUTERSThe World Health Organization warned of a steady rise in Covid-19 cases and deaths in recent weeks, urging people Wednesday to stick with mask mandates and social distancing rules as the world enters a critical phase of the pandemic.”We’re into our second year of the pandemic. There is a lot of frustration and fatigue out there wanting this pandemic to be over, but with transmission increasing, it’s going in the wrong direction,” Dr. Maria Van Kerkhove, the WHO’s Covid-19 technical lead, said during a Q&A at the organization’s headquarters in Geneva. “This is far from over. We’re not talking about a handful of cases here and there. We are still in the acute phase of the pandemic.”Cases climbed by 14% across the globe last week — the sixth-consecutive weekly increase — and deaths jumped for the third week in a row, she said. Globally, there have been more than 128 million Covid-19 cases and 2.8 million deaths since the virus emerged a little over a year ago, according to data compiled by John Hopkins University.The countries with the biggest jumps in transmission are India, the United States, Brazil, Turkey, Poland, Italy, Ukraine, Philippines, Germany and Iran, she said.French President Emmanuel Macron ordered the country into its third national lockdown Wednesday and said schools would close for three weeks as the country tries to fend off a third wave of infections that threatens to overrun hospitals. “We will lose control if we do not move now,” he said in a televised address to the nation.The virus is “stronger, it’s faster” with the emergence of new variants that spread more easily and are more deadly than the original wild strain of the virus, said Dr. Mike Ryan, the head of the WHO’s emergencies program. “We’re all struggling” with and sick of restrictive lockdowns, he said.”It’s a watershed moment in the pandemic, because at the very moment that we need to stay the course with all of this, we’re seeing the numbers start to rise and governments going back to restrictive measures,” he said. More

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    Cramer is bullish on bank and industrial stocks, cautious on tech and health care into Q2

    In this article.DJI.SPX.IXICCLFAMZNAAPLZSNOWDon’t count on tech stocks outperforming as the second quarter kicks off, CNBC’s Jim Cramer cautioned on Wednesday.”If you’re hoping that happy days are here again for tech, I’ve got some lukewarm news,” he said on “Mad Money.” “As the second quarter gets rolling, I think this market will become even kinder to the industrials and … the banks,” he said, “and even less hospitable to tech and health care.”Cramer highlighted Cleveland-Cliffs as a potential winner in the second quarter. The stock shot up nearly 17% on Wednesday after the steel products supplier released preliminary results that were much stronger than expected. Cleveland-Cliffs is an example of the companies that putting up numbers that are attracting money from big fund investors, Cramer said. These investors are also rotating away from tech stocks such as Amazon, Apple, Zscaler and ServiceNow. The four tech names are down more than 5% this year. “Money managers don’t care about the most exciting long-term growth stories … they want the companies that can deliver the biggest upside surprises right here,” Cramer said. “In a booming economy, that means owning boom-and-bust cyclicals, like CLF, and not the stocks of companies that may represent future growth or may not, depending on their execution and the execution of their competitors.”The moves are a part of the reopening trade as optimism grows about the economic rebound. Investors are shifting attention from the stay-at-home and remote-work plays of last year in favor of companies that will have more favorable year-over-year comparisons in their businesses.”It’s not just that the industrials have better comparisons year over year, you’ve got that inflation issue. … As the economy gains momentum, that tends to produce higher inflation, inflation is devastating for fantastic [growth] companies,” Cramer said.”Their stocks trade on potential earnings five to ten years down the road, but inflation means those future dollars have a lot less purchasing power, and those earnings are just eroded.”Cramer’s comments came after Wall Street wrapped up the first quarter of 2021. The Dow Jones Industrial Average jumped more than 7% to start the year. The S&P 500 and Nasdaq Composite advanced 5.8% and 2.8%, respectively. On Wednesday, however, the Dow slipped 85 points. The S&P 500 climbed 0.4%, and the Nasdaq Composite popped 1.5% in what Cramer called a “countertrend rally.”Disclosure: Cramer’s charitable trust owns shares of Amazon and Apple.DisclaimerQuestions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer’s world? Hit him up! Mad Money Twitter – Jim Cramer Twitter – Facebook – InstagramQuestions, comments, suggestions for the “Mad Money” website? [email protected] More

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    Ford slashes vehicle production at six plants in North America due to chip shortage

    In this articleFFORDFord Motor is significantly cutting production at six plants in North America due to an ongoing global shortage of semiconductor chips, including facilities that produce highly profitable pickup trucks.The actions vary by plant but range from overtime shift cancellations to facilities being closed for up to three weeks from April through June. Or a combination of both.The impacted plants are in Illinois, Ohio, Kentucky, Michigan, Missouri and Ontario, Canada. They produce an array of products – from F-150 pickups and vans to the Ford Explorer SUV and Ford Escape crossover.Production of the F-150 in Dearborn, Michigan, will be down the weeks of April 5 and April 12, the company said. Ford also is canceling overtime shifts at the plant the weeks of April 26, May 10, May 31 and June 21. Another plant in Missouri that produces the full-size F-150 will be idled for a week starting Monday. Overtime shifts at the plant are being terminated for eight weeks through most of June.Ford started resuming vehicle production in the U.S. on May 18, 2020 with new coronavirus safety protocols such as health assessments, personal protective equipment and facility modifications to increase social distancing.FordFord previously said it expected the shortage could lower its earnings by $1 billion to $2.5 billion in 2021. Without releasing any new guidance, the company said it “will provide an update on the financial impact of the semiconductor shortage” when it reports its first quarter earnings on April 28.Semiconductors are key components used in the infotainment, power steering and braking systems of new vehicles, among other things. As multiple plants shut down last year due to Covid, suppliers directed semiconductors away from automakers to other industries, creating a shortage after consumer demand snapped back stronger than expected.Consulting firm AlixPartners estimates the chip shortage will cut $60.6 billion in revenue from the global automotive industry this year. The problem is impacting every automaker differently.Ford’s Oakville Assembly plant in Canada, which produces the Ford Edge crossover, will be down for three weeks beginning the week of April 12 – the longest of any of the plants. Another facility in Kentucky that produces the Ford Escape and Lincoln Corsair will be down beginning then for two weeks.Other plants that produce the Ford Explorer and Lincoln Aviator SUVs, Ford Transit and E-Series vans, and medium-duty trucks and chassis cabs will have overtime shifts eliminated.Correction: This article was updated to reflect that Ford is cutting production at six plants. A previous version of this article misstated the number of plants. More

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    Major U.S. companies take aim at Georgia's new voting restrictions

    In this articleUPSPAH3-DEMRKDALKOBLKMSFTCSCOHDJPMCAXPFBVIACBACBusiness executives across the United States are calling out efforts to restrict voting access after Georgia Gov. Brian Kemp signed a law that opponents say would disproportionately disenfranchise people of color.Among the overhaul of state elections, the bill includes a restriction on drop boxes, makes it a crime to provide food or water to voters lined up outside polling stations, requires mandatory proof of identity for absentee voting and creates greater legislative control over how elections are run.The bill is one of many Republican-backed election efforts introduced across the U.S. after former President Donald Trump and other GOP members falsely claimed that last year’s election defeat was due to fraud. Supporters say the law was needed to restore confidence in Georgia’s elections.For Georgia, it comes after historic turnout in the state’s election, particularly among Black voters and voters of color, in the November general election and the January runoff that saw two Democrats defeat incumbent Republican senators.Civil rights groups, corporate leaders and Democratic officials are denouncing the law.CNBC compiled a list of corporate responses to the bill:Global asset manager BlackRock issued a statement Wednesday on LinkedIn.”Equal access to voting is the very foundation of American democracy. While BlackRock appreciates the importance of maintaining election integrity and transparency, these should not be used to restrict equal access to the polls. BlackRock is concerned about efforts that could limit access to the ballot for anyone. Voting should be easy and accessible for ALL eligible voters. Voting is not just a right, but a vital component of civil activity. We should encourage all eligible voters to play this essential role in our democracy,” CEO Larry Fink wrote.Coca-Cola executive Alfredo Rivera said in a statement the company, which is headquartered in Georgia, is disappointed by the law. “As soon as Georgia’s legislature convened this year, our company joined with other Georgia businesses to share our core principles: We opposed measures that would seek to diminish or restrict voter access and we advocated for broad access, voter convenience, election integrity and political neutrality. Anything that inhibits these principles can lead to voter suppression. We took these steps because they align to our Purpose and the conscience we follow,” he said.Georgia-based Delta airlines said in a memo to employees that the “final bill is unacceptable and does not match Delta’s values.” “After having time to now fully understand all that is in the bill, coupled with discussions with leaders and employees in the Black community, it’s evident that the bill includes provisions that will make it harder for many underrepresented voters, particularly Black voters, to exercise their constitutional right to elect their representatives. That is wrong,” CEO Ed Bastian said.Pharmaceutical giant Merck said Wednesday that the company stands “strong on our core values including our commitment to social justice and the right of people to fully and freely participate in electoral processes.” “There is no more fundamental right than the right to vote. Democracy rests on ensuring that every eligible voter has an equal and fair opportunity to cast a ballot, free from restrictions that have a discriminatory impact. We all have an obligation to stand up against racism and other forms of discrimination whenever we see them,” the company added.Porsche’s North American operations, headquartered in Georgia, said that “equal access to the polls for every voter is core to a democracy.” “As an Atlanta-based business, Porsche Cars North America (PCNA) supported the work of the Metro Atlanta Chamber with members of the Georgia General Assembly to maximize voter participation and ensure election integrity. We understand the legislative outcome remains subject to debate and hope a resolution can be found between all sides that encourages and enables every eligible vote,” the company said.Georgia-based UPS said this week the company supports the ability and facilitation of all eligible voters to exercise their right to vote. “Like other businesses in the community, we actively engaged with political leaders in both parties and other stakeholders to advocate for more equitable access to the polls and for integrity in the election process across the state. We echo the statement by the Metro Atlanta Chamber and stand ready to continue to help in ensuring every Georgia voter has the ability to vote,” the company said.Mercedes-Benz said that it “stands against efforts which discourage eligible voters to participate in this vital process.”In a blog post, Microsoft President Brad Smith noted the company expressed concern about the law prior to its passage and laid out its opposition in further detail, such as narrowing the window of time voters can request an absentee ballot. “We recognize that some recent criticisms of Georgia’s legislation have proven inaccurate. But already, it’s clear to us that the new law contains important provisions that needlessly and unfairly make it more difficult for people to vote,” Smith wrote. “This new law falls short of the mark, and we should work together to press the Georgia legislature to change it,” he added.Brian Moynihan, chairman and CEO of Bank of America, told CNBC in a statement that ensuring equal voting access is aligned with the company’s investments in reducing racial inequality and increasing economic opportunity. “The right to vote – and the vital work that must be done to protect access to that right – is a fundamental principle in the United States,” he said. “Our history in fact is punctuated by the moments when we expanded that right to those to whom it had been denied too long. We must continue to right the wrongs of our past, and stand united in our advocacy for equal voting rights for all.”  Cisco CEO Chuck Robbins shared his concern for the new law in a tweet. “Our vote is our voice, and everyone deserves the opportunity to be heard. Governments should be working to make it easier to vote, not harder. Ensuring equal #VotingRights isn’t a political issue, it’s an issue of right and wrong,” he said.Home Depot, which is headquartered in Georgia, said that it will work to ensure its workers across the country have the resources and information to vote. “We believe that all elections should be accessible, fair and secure and support broad voter participation.”JPMorgan Chase CEO Jamie Dimon said in a statement that “voting is fundamental to the health and future of our democracy,” calling out restrictive election laws. “JPMorgan Chase employees span the United States and as state capitals debate election laws, we believe voting must be accessible and equitable. We regularly encourage our employees to exercise their fundamental right to vote, and we stand against efforts that may prevent them from being able to do so. We are a stronger country when every citizen has a voice and a vote,” the company said. CNN first reported on the statement.Citigroup said it strongly opposes “efforts to undermine the ability of Americans to avail themselves of this fundamental right.”In a LinkedIn post, American Express CEO Steve Squeri complimented the new effort co-led by the company’s former chairman and chief executive, Ken Chenault, to spur corporate America stand up for voting rights. “As a company and leadership team, we support this message and stand against any efforts to suppress voting which is a fundamental right that belongs to all Americans,” Squeri wrote.Facebook said that the company supports “making voting as accessible and broad-based as possible” and that it opposes “efforts to make it harder for people to vote.”ViacomCBS said it believes “in the importance of all Americans having an equal right to vote and oppose the recent Georgia voting rights law or any effort that impedes the ability to exercise this vital constitutional right. Increasing voter access and civic engagement is one of ViacomCBS’ core social impact pillars and we will continue to educate the public on the importance of an open and fair voting system through our programming and extensive partnerships with grassroots organizations that promote and increase participation in elections.”In a statement Wednesday to CNBC, Kemp defended the law and specifically took aim at Delta’s chief executive. “Today’s statement by Delta CEO Ed Bastian stands in stark contrast to our conversations with the company, ignores the content of the new law and unfortunately continues to spread the same false attacks being repeated by partisan activists,” the Republican governor said. “Mr. Bastian should compare voting laws in Georgia — which include no-excuse absentee balloting, online voter registration, 17 days of early voting with an additional two optional Sundays, and automatic voter registration when obtaining a driver’s license — with other states Delta Airlines operates in,” he added.Kemp doubled down on that argument in an interview later Wednesday on CNBC’s “Closing Bell,” saying he was “glad to deal with” the wave of corporate criticism. He also pointed to measures of the bill that expand ballot access, contending that in more than 130 of Georgia’s 159 counties early voting hours will be lengthened thanks to the legislation.”If [executives] want to have a debate about the merits and the facts of the bill, then we should do that,” Kemp said.CNBC’s Frank Holland, Mike Wayland, Phil LeBeau, Courtney Reagan, Sara Eisen, Amelia Lucas, Steve Desaulniers, Hannah Miao and Leslie Picker contributed to this report. More

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    Treasury Secretary Yellen to restart hedge fund oversight panel as part of financial reform goals

    Treasury Secretary Janet Yellen laid out a three-pronged agenda on Wednesday to address what she described as ongoing threats to the nation’s financial system.Those threats include both disruptions that occurred early in the Covid-19 pandemic as well as more recent developments regarding hedge funds.Presiding over the Financial Stability Oversight Council, which she now leads but was once a member, Yellen said last year’s market disruptions at the onset of the Covid-19 pandemic could have been worse.”If not for the swift action of the Federal Reserve, Treasury, Congress and others, those stresses may have led to an even greater economic contraction,” she said. “Indeed, we are digging out of a deep hole now, but we should be mindful that the hole could easily have been deeper.”The meeting comes just days after family office Archegos was at the center of a market disruption related to margin calls. Credit Suisse and Nomura warned they would take substantial hits, and shares of ViacomCBS and Discovery got slammed.A summary from an executive session of the committee said the panel “discussed recent market developments related to hedge fund activities,” though the readout did not mention Archegos specifically.Mutual funds and climate changeYellen tasked the council with addressing three areas: Vulnerabilities in money market and open-end mutual funds and other nonbank financial market issues, weaknesses in the U.S. Treasurys market, and dangers that climate change could pose to the system.One part of that work will entail reestablishing the FSOC’s hedge fund oversight group, which had previously been disbanded.”The pandemic showed that leverage of some hedge funds can amplify stresses, too,” Yellen said. “This council used to have a hedge fund working group, and as of today we have one again. We’re establishing the working group so that we can better share data, identify risks and work to strengthen our financial system.”That system locked up last March as the Covid-19 threat turned into a pandemic. A rush for cash among institutional investors clogged what normally are highly liquid short-term funding markets, requiring the Fed and Treasury to work together to stand up multiple facilities aimed at thawing those markets.Most of those facilities have been shuttered, but the Fed is still buying at least $120 billion of bonds a month in part to ensure smooth market functioning.On the climate change issue, Yellen reiterated concerns that she has shared on the issue and have been voiced by several Fed officials. The central bank recently has established a pair of committees that will examine what big banks should be doing to brace against climate-related events.”It’s an existential threat to our environment, and it poses a tremendous risk to our country’s financial stability,” Yellen said.Other issues she expects FSOC to address include cyber threats, the growing use of non-banks for corporate credit, and the increasing presence of digital currencies. More

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    Starbucks strikes deal with EEOC over alleged racial bias in promoting employees

    In this articleSBUXStarbucks bags with free items, in recognition of the Starbucks coffee shot that is slated to go in at the CollegeTowne location, Reading, Pennsylvania, January 12, 2021.Ben Hasty | MediaNews Group | Reading Eagle via Getty ImagesStarbucks said Wednesday it has resolved allegations from the Equal Employment Opportunity Commission about alleged racial bias in its employee promotions, based on data from 2007 through 2011.In a letter to employees, CEO Kevin Johnson said that Starbucks does not know what prompted the EEOC allegations and that the company’s analysis of its own data did not show systemic discrimination in store-level promotions.”The agreement is not only the right thing for partners, it has also led us to focus more resources on structural changes necessary to support partners’ career progressions and ensure that every partner has the opportunity to learn about promotion opportunities,” Johnson wrote.The agreement with the federal agency was disclosed in Starbucks’ third annual civil rights assessment from the law firm Covington & Burling. The law firm said in the report that it did not represent Starbucks in the matter or independently investigate the allegations.A Starbucks spokesperson said that the company was engaged in on-and-off dialogue with the EEOC before reaching the agreement earlier this year. The spokesperson declined to comment on whether there was financial penalty, citing the confidentiality of the legal matter.To make the promotion process for cafe employees more formal and transparent, the company is developing an application tracking system that shows all retail job postings and includes ways to track data. Store managers will no longer be able to promote workers outside of the formal promotion framework, and the company is rolling out new training for leadership involved in hiring decisions, including new interview guides.The responsibilities of Starbucks’ inclusion and diversity team will expand to include overseeing compliance and analytics and ensuring that diversity goals play a role in making business decisions. The company has also hired an independent labor economist to analyze data, create promotion goals and track its progress in achieving those targets.The company first commissioned a civil rights assessment from Covington & Burling in 2019, months after police arrested two Black men who hadn’t ordered yet at a Philadelphia cafe. The backlash that resulted from the incident led the company to close all of its company-operated locations for a day of training on racial bias and to make stronger commitments to be more inclusive.In the wake of the Black Lives Matter protests that began in late May last year, Starbucks made additional commitments to stand up for racial justice and equity, including in its own workplace. It updated its “third place policy,” including adding specific examples of unacceptable behavior, like hate speech or racial slurs, and provided deescalation training to baristas. In October, Starbucks said that it would tie executive pay to new diversity targets. Earlier in March, Starbucks promoted Dennis Brockman to the role of global chief inclusion and diversity officer. More