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    Bank of America CEO on inflation impact on U.S. economy: ‘Rates are going to stay where they are’

    Bank of America CEO Brian Moynihan said Wednesday that strong consumer spending so far this year means that the Federal Reserve will probably hold off on cutting its benchmark interest rate.
    The bank’s retail customers are spending about 6% more money in the first 40 days of this year compared to the same period in 2024, Moynihan told CNBC’s Leslie Picker.
    “That’s driving price firmness, demand firmness,” Moynihan said. “You’re seeing activity that says that we’re probably in a period where rates are going to stay … where they are for a while until this settles in.”

    Bank of America CEO Brian Moynihan said Wednesday that strong consumer spending so far this year means the Federal Reserve will probably hold off on cutting its benchmark interest rate.
    The bank’s retail customers are spending about 6% more money in the first 40 days of this year compared with the same period in 2024, Moynihan told CNBC’s Leslie Picker. That rate is an acceleration from the spending growth seen in the final three months of last year, he noted.

    “That’s driving price firmness, demand firmness,” Moynihan said. “You’re seeing activity that says that we’re probably in a period where rates are going to stay … where they are for a while until this settles in.”
    The Bureau of Labor Statistics reported hotter-than-expected growth in the U.S. consumer price index earlier Wednesday, forcing markets to recalibrate rate expectations. The Fed began an easing cycle in September, reducing rates for the first time since the 2020 pandemic, but the central bank is seen as limited in how much it can cut by stubborn inflation.
    Last month, the Fed opted to keep its benchmark rate unchanged at a range of 4.25%-4.5%.
    “Rates are restrictive, but there was not enough sort of inflation progress that we made” to cut rates, Moynihan said.
    Bank of America research analysts expect no rate reductions in the immediate future because of elevated inflation, he added.

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    The New York Stock Exchange is launching an exchange in Texas

    NYSE Chicago, previously the Chicago Stock Exchange, will soon become NYSE Texas.
    Last month, TXSE Group announced that it had filed for registration of the Texas Stock Exchange with the Securities and Exchange Commission.
    Texas has also emerged as a competitor to Delaware as the legal home of major companies.

    A person walks past the New York Stock Exchange at Wall Street in New York on Feb. 3, 2025.
    Angela Weiss | AFP | Getty Images

    The New York Stock Exchange will soon have a presence in Texas to cater to the growing number of companies looking for a home base in the business-friendly state.
    The NYSE announced Wednesday that one of its electronic exchanges, NYSE Chicago, will reincorporate in Texas and be renamed NYSE Texas, giving companies an option to list their stocks in the Lone Star State.

    “As the state with the largest number of NYSE listings, representing over $3.7 trillion in market value for our community, Texas is a market leader in fostering a pro-business atmosphere,” Lynn Martin, president of NYSE Group, said in a release.
    The NYSE is part of Intercontinental Exchange. NYSE Chicago was previously the Chicago Stock Exchange, which was acquired by ICE in 2018.
    The move comes as a potential competitor to the NYSE is emerging in Texas. Last month, TXSE Group announced that it had filed for registration of the Texas Stock Exchange with the Securities and Exchange Commission. TXSE Group said it has raised $161 million and intends to launch trading in early 2026.
    Texas Gov. Greg Abbott told CNBC last year that rules around environmental, social and governance, or ESG, was a motivation to have a Texas-based exchange. Texas is one of several states that have pushed back against ESG rules from Wall Street firms.
    “We need to make sure that Texas companies, and companies similarly situated, are not going to be cut off from capital markets in New York with policy decisions made from the left in places like New York,” Abbott said.

    Texas has also emerged as a competitor to Delaware as the legal home of major companies. Tesla reincorporated in Texas last year after a legal fight in Delaware court over a pay package for CEO Elon Musk. The Wall Street Journal reported last month that Meta Platforms was exploring a similar move.
    Trading at the NYSE exchanges and most major stock exchanges around the world is done almost entirely electronically. Stocks trade on multiple exchanges even if they have one designated as their primary listing.

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    Warren Buffett’s Berkshire buys more Occidental after 30% sell-off from record high

    Warren Buffett speaks during the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska, on May 4, 2024.

    Warren Buffett’s Berkshire Hathaway purchased more shares of Occidental Petroleum after the oil and gas producer tumbled more than 30% from its record high.
    The Omaha, Nebraska-based conglomerate scooped up 763,017 shares of the Houston-based energy company on Friday for $35.7 million, according to a regulatory filing. Berkshire is Occidental’s biggest investor, holding a 28.2% stake.

    Shares of Occidental have fallen nearly 32% from an all-time high reached last April. The stock dropped more than 17% in 2024 as oil prices weakened.

    Stock chart icon

    Occidental shares over the past year

    In late December, Berkshire purchased 8.9 million Occidental shares during a broad market pullback. Occidental remains Berkshire’s sixth-largest equity holding.
    Buffett has made clear he won’t take full control of the oil company, founded by legendary oilman Armand Hammer. There had been speculation of a takeover after Berkshire received regulatory approval to buy as much as a 50% stake. 
    The “Oracle of Omaha” previously said he started buying Occidental after reading a transcript of the oil company’s earnings conference call. Occidental also pays a 1.8% dividend yield and has been investing in a carbon capture business.
    Berkshire also owns $10 billion of Occidental preferred stock and has warrants to buy another 83.9 million common shares for $5 billion, or $59.62 each. The warrants were obtained as part of Berkshire’s 2019 deal that helped finance Occidental’s purchase of Anadarko Petroleum.

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    Biogen beats estimates on cost cuts and new drugs like Leqembi, but profit outlook falls short 

    Biogen posted fourth-quarter revenue and profit that topped expectations as its cost cuts showed progress and new products, including its breakthrough Alzheimer’s treatment Leqembi, saw growth. 
    The biotech company issued a full-year 2025 adjusted earnings outlook of $15.25 to $16.25 per share, which fell short of the $16.34 per share that Wall Street was expecting.
    Biogen expects to generate $1 billion in gross savings, or $800 million net savings, by the end of 2025. 

    A test tube is seen in front of displayed Biogen logo in this illustration taken on, December 1, 2021.
    Dado Ruvic | Reuters

    Biogen on Wednesday posted fourth-quarter revenue and profit that topped expectations as its cost cuts showed progress and new products, including its breakthrough Alzheimer’s treatment Leqembi, saw growth. 
    But the biotech company’s guidance for the current year missed Wall Street’s expectations. Biogen issued a full-year 2025 adjusted earnings outlook of $15.25 to $16.25 per share, which fell short of the $16.34 per share that analysts were anticipating, according to LSEG. That reflects a foreign exchange headwind of 35 cents per share, Biogen said.  

    Biogen expects revenue to decline by a “mid-single digit” percentage in 2025 compared with 2024, as sales of its multiple sclerosis products fall. That portion of the business has declined for several quarters as some of those therapies face generic competition. 

    More CNBC health coverage

    But Biogen expects Leqembi, along with its new rare disease and depression treatments, to help offset that sliding revenue this year. 
    Leqembi generated $87 million in revenue for the fourth quarter, including $50 million in the U.S. Analysts had expected the drug to book $67 million in sales, according to estimates from StreetAccount. 
    Leqembi, which Biogen shares with the Japanese drugmaker Eisai, became the second drug proven to slow the progression of Alzheimer’s to win approval in the U.S. in 2023. The therapy’s launch has been gradual due to bottlenecks related to diagnostic test requirements, the need for regular brain scans and the difficulty of finding neurologists, among other issues. 
    Here’s what Biogen reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG: 

    Earnings per share: $3.44 adjusted vs. $3.35 per share expected
    Revenue: $2.46 billion vs. $2.40 billion expected

    Biogen booked sales of $2.46 billion for the quarter, which is up around 3% from the year-earlier period. 
    The drugmaker posted net income of $266.8 million, or $1.83 per share, for the quarter. That compares with net income of $249.7 million, or $1.71 per share, for the same period a year ago. 
    Adjusting for one-time items, including certain restructuring charges and costs associated with intangible assets, the company reported earnings of $3.44 per share.
    Biogen first initiated a cost-cutting program in 2023. The company expects to generate $1 billion in gross savings, or $800 million net savings, by the end of 2025. 
    Also on Wednesday, Royalty Pharma announced an agreement to provide $250 million in research and development funding to Biogen for litifilimab, a key drug in its pipeline that is being studied to treat lupus. Royalty Pharma, a leading funder of the biotech and pharmaceutical industry, will be eligible for regulatory milestones and certain royalties.

    Other new drugs

    Another new drug, Skyclarys, booked $102 million in sales for the fourth quarter, almost double what it reported in the year-earlier period.
    Analysts had expected sales of around $112 million for the quarter, according to StreetAccount. 
    Skyclarys came from Biogen’s acquisition of Reata Pharmaceuticals in July 2023. The Food and Drug Administration greenlit Skyclarys in 2023, making it the first approved treatment for Friedreich’s ataxia, a rare inherited degenerative disease that can impair walking and coordination in children as young as 5. 
    Zurzuvae, the first pill for postpartum depression, generated fourth-quarter sales of $22.9 million. Analysts had expected it to post $26 million in sales, StreetAccount estimates said.
    Meanwhile, Biogen’s fourth-quarter sales from multiple sclerosis treatments fell 8% to $1.07 billion.
    Correction: Biogen’s fourth-quarter sales from multiple sclerosis treatments fell to $1.07 billion. An earlier version misstated the period.

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    CVS shares pop 10% on big earnings beat, even as high medical costs drag down insurance unit

    CVS Health reported fourth-quarter revenue and profit that topped estimates, even as its troubled insurance business saw higher medical costs. 
    The company also issued a full-year 2025 adjusted profit outlook of $5.75 to $6.00 per share, which was in line with Wall Street’s expectations.
    It caps off the first full quarter with David Joyner, a longtime CVS executive, as CEO of the troubled retail drugstore chain.

    CVS Health on Wednesday reported fourth-quarter revenue and profit that topped estimates, even as its troubled insurance business continued to see higher medical costs. 
    The company also issued a full-year 2025 adjusted earnings outlook of $5.75 to $6 per share, which was in line with Wall Street’s expectations. But CVS did not provide a revenue forecast for the year. 

    It caps off the first full quarter with David Joyner, a longtime CVS executive, as CEO of the troubled retail drugstore chain. Joyner succeeded Karen Lynch in mid-October, as CVS struggled to drive higher profits and improve its stock performance.
    The company underwent a management reshuffle as part of a broader turnaround plan that includes $2 billion in cost cuts over the next several years. CVS has grappled with rising costs in its insurance unit, Aetna, and a retail pharmacy business pressured by softer consumer spending and lower reimbursements for prescription drugs. 
    Here’s what CVS reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG: 

    Earnings per share: $1.19 per share adjusted vs. 93 cents per share expected
    Revenue: $97.71 billion vs. $97.19 billion expected

    The company’s shares rose 10% in premarket trading.
    CVS and other insurers such as UnitedHealth Group and Humana have seen medical costs spike over the last year as more Medicare Advantage patients return to hospitals for procedures they delayed during the pandemic. 

    Medicare Advantage, a privately run health insurance plan contracted by Medicare, has long been a driver of growth and profits for insurers. But investors have become concerned about the runaway costs tied to those plans, which cover more than half of all Medicare beneficiaries. 
    CVS booked sales of $97.71 billion for the fourth quarter, up 4.2% from the same period a year ago due to growth in its pharmacy business and insurance unit. 
    The company posted net income of $1.64 billion, or $1.30 per share, for the fourth quarter. That compares with net income of $2.05 billion, or $1.58 per share, for the year-earlier period. 
    Excluding certain items, such as amortization of intangible assets, restructuring charges and capital losses, adjusted earnings were $1.19 per share for the quarter.
    CVS said its fourth-quarter earnings reflect higher medical costs in its insurance business and lower Medicare Advantage star ratings for the 2024 payment year, both of which weighed on the segment’s operating results for the quarter. Those star ratings help Medicare patients compare the quality of Medicare health and drug plans. 

    Pressure on insurance unit

    All three of CVS’ business segments beat Wall Street’s expectations for the fourth quarter.
    CVS’ insurance business booked $32.96 billion in revenue during the quarter, up more than 23% from the fourth quarter of 2023. Analysts expected the unit to take in $32.89 billion for the period, according to estimates from StreetAccount.
    But the business reported an adjusted operating loss of $439 million for the fourth quarter, compared with adjusted operating income of $676 million in the year-earlier period. That change was driven by higher medical costs and the company’s Medicare Advantage star ratings, among other factors.

    More CNBC health coverage

    The insurance unit’s medical benefit ratio — a measure of total medical expenses paid relative to premiums collected — increased to 94.8% from 88.5% a year earlier. A lower ratio typically indicates that a company collected more in premiums than it paid out in benefits, resulting in higher profitability.
    The fourth-quarter ratio was lower than the 95.9% that analysts were expecting, StreetAccount estimates said.
    CVS’ health services segment generated $47.02 billion in revenue for the quarter, down more than 4% compared with the same quarter in 2023. Analysts expected the unit to post $44.06 billion in sales for the period, according to StreetAccount.
    That unit includes Caremark, one of the nation’s largest pharmacy benefit managers. Caremark negotiates drug discounts with manufacturers on behalf of insurance plans and creates lists of medications, or formularies, that are covered by insurance and reimburses pharmacies for prescriptions.
    CVS’ health services division processed 499.4 million pharmacy claims during the quarter, down from 600.8 million during the year-ago period due to the loss of an unnamed large client. Tyson Foods told CNBC in January 2024 that it dropped CVS as the pharmacy benefit manager for its roughly 140,000 employees, but it is unclear if any other companies stopped working with CVS during the year, as well.
    CVS’ pharmacy and consumer wellness division booked $33.51 billion in sales for the fourth quarter, up more than 7% from the same period a year earlier. Analysts expected sales of $33.03 billion for the quarter, StreetAccount said.
    That unit dispenses prescriptions in CVS’ more than 9,000 retail pharmacies and provides other pharmacy services, such as vaccinations and diagnostic testing.
    The increase was partly driven by higher prescription volume, CVS said. Pharmacy reimbursement pressure, the launch of new generic drugs and lower volume from front-of-store items like pantry food and toiletries, including from decreased store count, weighed on the unit’s sales.

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    Zelle payments top $1 trillion in 2024 as network’s growth outpaces rivals including PayPal

    Zelle crossed $1 trillion in total volumes last year, which it said was the most ever for a peer-to-peer platform.
    The payments network said its user base jumped 12% to 151 million accounts in 2024, and that the total dollars sent on the platform jumped 27% from the year earlier.
    Zelle was launched in 2017 in response to the rise of platforms like Venmo, PayPal and CashApp.

    Zelle icon displayed on a phone screen and Zelle logo displayed on a screen in the background are seen in this illustration photo taken in Krakow, Poland.
    Jakub Porzycki | Nurphoto | Getty Images

    Zelle, the payments network run by bank-owned Early Warning Services, crossed $1 trillion in total volumes last year, which it said was the most ever for a peer-to-peer platform.
    The firm said Wednesday that its user base jumped 12% to 151 million accounts in 2024, and that the total dollars sent on the platform jumped 27% from the year earlier.

    Last year’s payment volumes were “by far the most money ever moved by a P2P payments service in a single year,” Denise Leonhard, general manager of Zelle, told CNBC.
    Zelle, which was launched in 2017 in response to fintech platforms like Venmo, PayPal and CashApp, has some key advantages over those players. EWS is owned by seven of the biggest U.S. banks, including JPMorgan Chase, Bank of America and Wells Fargo, and Zelle allows for instant money transfers made within the apps of thousands of member institutions.
    Its growth rate last year exceeded that of PayPal, which reported that total P2P payments volumes reached more than $400 billion.
    Zelle’s meteoric rise comes amid accusations that the network and the three biggest U.S. banks on it failed to properly investigate fraud complaints or give victims reimbursement. The company has introduced measures to reduce fraud and has said that 99.95% of transactions are free of fraud and scams.
    Growth is being driven as bank customers increasingly use Zelle instead of cash or checks, and as small businesses adopt the payment option, said Leonhard.
    “People are using Zelle in order to do things like pay their rent or paying their nanny,” Leonhard said. “We want to continue to be top of mind for those consumers to be able to use this every day.” More

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    Tom Brady buys ownership stake in sports collectibles company

    Tom Brady will acquire a 50% stake in CardVault.
    The company will change its name to “CardVault by Tom Brady.”
    Card collecting has surged since the Covid-19 pandemic.

    Seven-time Super Bowl champion Tom Brady is entering the sports collectibles space.
    Brady will acquire a 50% stake in CardVault, a sports card and memorabilia retailer, the company announced on Wednesday.

    As part of the deal, CardVault will change its name to “CardVault by Tom Brady,” and is planning to rapidly scale its footprint. Card collecting has experienced a resurgence since the Covid-19 pandemic, leading to record sale prices.
    The sports collectibles retailer currently has locations at TD Garden in Boston; Gillette Stadium in Foxborough, Massachusetts; and Foxwoods Resort Casino in Mashantucket, Connecticut. The company will open a new flagship location this spring at American Dream mall, next to MetLife Stadium in New Jersey, and said it is actively identifying new locations in other sports hubs.

    CardVault retail store in Boston

    “This isn’t just about buying and selling cards; it’s about curating history, building community, turning fans into collectors, and giving them access to own great moments in sports,” Brady said in a statement.
    CardVault was founded in 2020 as a way for collectors to buy, sell, grade and trade cards. The store also sells memorabilia.
    The company is planning to expand its digital content as it looks to reach new collectors and investors.

    This isn’t Brady’s first foray in the collectibles space. In December, he put his valuable watch collection up for sale at Sotheby’s.
    The former quarterback was also seen buying up cards at Fanatics Fest in August.
    “Sports collectibles and cards have been part of my DNA since childhood, and CardVault has set the gold standard for what a modern fan experience should be,” Brady said. More