By John McCrank

NEW YORK (Reuters) – The U.S. dollar sank more than 1% against a basket of peers on Wednesday as weakening economic data firmed views that the Federal Reserve will slow the pace of its rate hiking cycle, sending the euro back above parity with the greenback for the first time in a month.

At 3:15 p.m. EDT (1915 GMT), the dollar was down 1.118% at 109.7 against a basket of six currencies, its weakest since Sept. 20.

The dollar’s decline came as the benchmark 10-year U.S. Treasury yield continued its descent from last week’s multi-year high of 4.338%, and was last down four basis points at 4.0317%.

“Broad dollar weakness and further but milder declines in U.S. Treasury yields than yesterday appear to reflect wishful thinking toward a Fed pivot next week,” said Derek Holt, head of capital markets at Scotia Economics.

The aggressive pace of Fed tightening this year, aimed at taming stubbornly high inflation, has turbo-charged the dollar.

Traders and economists predict a fourth-straight 75 basis-point interest rate increase next Wednesday, but there is growing speculation that the central bank will slow to half a point in December.

The view that the Fed could begin to pivot in December was reinforced by data on Tuesday that showed U.S. home prices sank in August as surging mortgage rates sapped demand.

Data on Wednesday showed that sales of new U.S. single-family homes dropped in September and data for the prior month was revised lower, supporting the view that Fed rate increases are already working to tap the breaks on the world’s biggest economy.

The European common currency was up 1.11% at $1.0079, its highest since Sept. 13.

Sterling also hit its highest since Sept. 13, surging 1.33% to $1.1625, extending the previous day’s 1.6% gain when markets took succour from Rishi Sunak becoming Britain’s prime minister.

“Optimism that Rishi Sunak and his team will restore stability and credibility in the UK is overshadowing the very difficult economic situation that he has inherited,” said Fiona Cincotta, senior financial markets analyst at City Index.

Elsewhere, the Bank of Canada hiked interest rates by a smaller-than-expected 50 basis points and said future increases would be influenced by its assessment of how tighter policy was working to slow demand and ease inflation.

The Canadian dollar initially fell against the U.S. dollar after the Bank of Canada decision, which was the second consecutive reduction in the size of rate rises after a 100 basis-point move in July and 75 basis points last month, but then firmed up again. The loonie hit a three-week high of 1.35105 earlier in the day.

The dollar slumped 1.55% against China’s offshore yuan, while the onshore yuan finished the domestic trading session at 7.1825 per dollar, the strongest close since Oct. 12.

Market participants became cautious after major state-owned banks were spotted selling the dollar in the previous session to stabilise the market, traders said, wondering if the yuan has reached its peak weakness for the time being. [CNY/]

The dollar also fell against the Japanese yen, sliding 1.11% to 146.290.

Cryptocurrencies extended their sharp rallies from the day before. Bitcoin was 4.45% higher at $20,981.

(Reporting by John McCrank in New York and Alun John in London; Editing by Jamie Freed, David Holmes, Hugh Lawson and Marguerita Choy)

By Sheila Dang

(Reuters) -“Is Twitter dying?” billionaire Elon Musk mused in April, five days before offering to buy the social media platform.

The reality, according to internal Twitter research seen by Reuters, goes far beyond the handful of examples of celebrities ghosting their own accounts. Twitter is struggling to keep its most active users – who are vital to the business – engaged, underscoring a challenge faced by the Tesla Inc chief executive as he approaches a deadline to close his $44 billion deal to buy the company.

These “heavy tweeters” account for less than 10% of monthly overall users but generate 90% of all tweets and half of global revenue. Heavy tweeters have been in “absolute decline” since the pandemic began, a Twitter researcher wrote in an internal document titled “Where did the Tweeters Go?”

A “heavy tweeter” is defined as someone who logs in to Twitter six or seven days a week and tweets about three to four times a week, the document said.

The research also found a shift in interests over the past two years among Twitter’s most active English-speaking users that could make the platform less attractive to advertisers. 

Cryptocurrency and “not safe for work” (NSFW) content, which includes nudity and [censored]ography, are the highest-growing topics of interest among English-speaking heavy users, the report found.

At the same time, interest in news, sports and entertainment is waning among those users. Tweets on those topics, which have helped Twitter burnish an image as the world’s “digital town square,” as Musk once called it, are also the most desirable for advertisers.

Twitter declined to specify how many of its tweets are in English or how much money it makes from English speakers. But the demographic is important to Twitter’s business, some analysts say.

The platform earned more ad revenue from the United States alone than all other markets combined in its fourth quarter, according to its investor letter, and most ads in the United States are likely targeting English-speaking users, said Jasmine Enberg, an analyst at Insider Intelligence.

Twitter’s study examined the number of heavy tweeters in English who displayed an interest in a topic, based on the accounts they followed, and how that number of users changed over the past two years.

Twitter was motivated to investigate “disturbing” trends among users that may have been masked by overall growth in daily active users and better understand the decline in the company’s most active users, the documents said. The study made no specific conclusions about why heavy users of the platform are declining.

Asked to comment on the internal documents’ findings, a Twitter spokesperson said on Monday: “We regularly conduct research on a wide variety of trends, which evolve based on what’s happening in the world. Our overall audience has continued to grow, reaching 238 million mDAU in Q2 2022,” the spokesperson said, using an acronym for monetizable daily active users.

‘NOT SAFE FOR WORK’ CONTENT

The number of heavy users interested in NSFW and cryptocurrency content grew, the research found.

Twitter is one of the few major social media platforms that permits nudity on its service, and the company has estimated that adult content constitutes 13% of Twitter, according to a separate internal slide presentation seen by Reuters. The presentation did not elaborate on how the figure was calculated.

Advertisers generally steer clear of controversy or nudity for fear of damaging their brands. Major advertisers including Dyson, PBS Kids and Forbes suspended advertising due to accounts that were soliciting child [censored]ography on Twitter, Reuters reported in September.

In response to the September story, Twitter said it “has zero tolerance for child sexual exploitation” and was investing more resources into its work against such material.

Twitter’s most active English-speaking users were also increasingly interested in cryptocurrencies, reaching an all-time high in late 2021, the internal documents showed. But interest in the topic has declined since the crypto price crash in June, and the study noted cryptocurrencies may not be an area of growth in the future.

Current and former Twitter employees who spoke with Reuters said they feared Musk’s calls for less content moderation and his reported plans to gut the staff, which they said will exacerbate the deterioration of the quality of content.

‘DEVASTATING’ LOSSES

Topics that have traditionally made Twitter a popular platform for its millions of users are now in decline among the most active English-speaking users, the documents show.

Interest in world news, as well as liberal politics, showed spikes during major events such as the attack on the U.S. Capitol on Jan. 6, 2021. But the categories have since lost the highest number of heavy Twitter users and have shown no signs of recovery, the report said.

Twitter is also losing a “devastating” percentage of heavy users who are interested in fashion or celebrities such as the Kardashian family. These users are likely decamping to rival platforms like Meta Platforms Inc’s Instagram and ByteDance’s TikTok, a Twitter researcher wrote.

The study also expressed surprise about the decline in interest for e-sports and online streaming personalities, which were previously growing quickly across Twitter. “The big communities are now in decline,” the report said.

“It seems as though there is a significant discrepancy between what I might imagine are our company values and our growth patterns,” one Twitter researcher wrote.

(Reporting by Sheila Dang in DallasEditing by Kenneth Li and Matthew Lewis)

By Rajesh Kumar Singh and Abhijith Ganapavaram

(Reuters) -Boeing Co on Wednesday warned its recovery from a crippling safety and economic crisis would take longer than expected after taking a $2.8-billion hit on loss-making defense contracts, sending its shares down sharply.

The heavy writedown came a day after Reuters reported a shake-up in operational management at the company’s defense unit and unexpectedly drove the aerospace giant into a deeper loss in the third-quarter.

“Our path to recovery is taking a bit longer than expected, driven by the challenging macro environment,” Chief Financial Officer Brian West said on an earnings call.

The company also cut estimates for 737 MAX deliveries this year as it wrestles with supply-chain disruptions, particularly delays in delays in jet engine deliveries.

Boeing’s shares fell about 12% from the day’s high. They were trading down 9% at $133.53 in afternoon trade.

The U.S. planemaker said supply constraints are not expected to get “much better” in the near-term and will persist through next year.

The Virginia-based planemaker is trying to emerge from overlapping crises – the pandemic and the grounding of its best-selling model after fatal crashes, which have left it with a pile of debt.

However, a run-up in costs in its defense contracts along with persistent shortages of parts and labor, and regulatory hurdles has made it tougher to shore up its fortunes.

Rising cost pressures over the last few months have hampered fixed-price contracts for U.S. aerospace and defense firms, prompting an industry body to ask the U.S. Congress for inflationary relief.

Since these contracts tend to have fixed prices, Boeing is required to absorb cost increases. Analysts at agency Partners estimates the company’s various fixed price defense contracts have already resulted in of $8.8 billion of charges.

Chief Executive David Calhoun told investors the company is not “embarrassed” by the losses on its fixed price defense contracts.

“They are what they are, and we intend to deliver against these contracts and satisfy our customers,” he said.

Boeing played down investor concerns that these contracts could result in more charges, saying the company was getting closer to finishing them.

Some analysts are not convinced, though. Vertical Research analyst Rob Stallard said the company’s poor track record in forecasting defense charges raised questions over “whatever outlook the company provides”.

“Boeing management continues to state that the company is in turn around mode, but we’d say that the arc of recovery remains extremely elongated,” said Stallard, adding the company was lurching from one problem to the next in “whack-a-mole” fashion.

In a boost for the company, Alaska Airlines said on Wednesday it will buy 52 737 MAX aircraft for delivery between 2024 and 2027.

SUPPLY CONSTRAINTS

Boeing said demand for commercial planes remains strong, but tight supplies are hurting production. It further cut estimates for MAX deliveries this year. It now expects to deliver 375 planes this year, lower than an earlier target of “low 400s.”

The company singled out delays in jet engine deliveries as the primary constraint in stabilizing and increasing production rates for 737 jets. It expects the aircraft’s monthly delivery trend to remain in the low 30s next year.

It called supply chain “a key watch item” for the production and deliveries of 787 jets as well.

Boeing also faces a late December deadline for the Federal Aviation Administration (FAA) to certify the MAX 7 and MAX 10 under existing rules.

After that date, all planes must have modern cockpit alerting systems to be certified by the FAA, which would mean significant delays for the new MAX aircrafts’ deployment unless Congress grants a waiver to extend the deadline.

Chief Executive Dave Calhoun said he is confident the planemaker will get an extension from the U.S. Congress of a key deadline to get the planes certified.

Boeing retained its forecast of generating cash this year after reporting a free cash flow of $2.9 billion in the September quarter, higher than $1.02 billion expected by analysts in a Refinitiv survey.

Adjusted loss per share in the third quarter widened to $6.18 from $0.60 a year ago. Analysts expected the company to report a profit of 7 cents a share.

Boeing has now fallen short of Wall Street earnings estimates for a fifth quarter in a row.

(Reporting by Abhijith Ganapavaram in Bengaluru and Rajesh Kumar Singh in Chicago; Editing by Arun Koyyur, Kirsten Donovan and Nick Zieminski)

(Reuters) -Shares of Mobileye Global Inc are up 30% in early afternoon trading on Wednesday following its U.S. debut, valuing the self-driving technology unit of Intel Corp at $21.8 billion as investors lapped up what could be the last major IPO of 2022.

The debut comes after a turbulent period when Mobileye settled for merely a third of the $50 billion valuation it was targeting earlier in its IPO.

“The valuation probably wasn’t what we wanted it to be. But there was a lot of value in gaining that public company platform now,” said Dan Galves, chief communications officer at Mobileye.

Galves added it is important for Mobileye to generate product visibility now as that filters back to customers. He pointed to the SuperVision product, launched with Zeeker last year, as a reason why it was the right time to go public.

U.S. IPOs are having one of their worst years on record, with traditional offerings on track to raise the least money in over two decades, according to Dealogic which tracks listing data going back to 1995.

Hundreds of companies have postponed IPO plans this year due to volatility in capital markets. Grocery delivery app Instacart has pulled its listing plans, Reuters reported last week, while social media giant Reddit, which confidentially filed for its IPO in December, has shown no signs of proceeding with it.

Before being acquired by chipmaker Intel in a $15.3 billion deal in 2017, Mobileye had been listed on the New York Stock Exchange since 2014.

Mobileye develops autonomous driving technologies and competes with Alphabet Inc’s Waymo, General Motors Co’s Cruise and other automakers who have moved to design in-house driving assistance technology.

Competition is getting fierce in the assisted driving market as Nvidia Corp and Qualcomm Inc both vie for automaker customers. Mobileye’s Galves said based on its design wins with automakers, its assisted driving systems would be deployed in 270 million cars by 2030, although he did not give a dollar amount for that. He said even if Mobileye stopped winning new business today, that future volume projection would still hold, adding that the current business brings in an average $45-50 per car.

He added that there is an opportunity to increase the amount of revenue generated per vehicle going forward with increased technology. The self-driving company does not have a timing for significant amount of AVs on the road, he said.

Qualcomm said in September that its automotive business pipeline increased to $30 billion and Nvidia in March put its number at $11 billion. That number has been jumping strongly for both companies.

(Reporting by Echo Wang in New York, Jane Lanhee Lee in San Francisco, Niket Nishant in Bengaluru, Steven Scheer in Jerusalem and Joseph White in Detroit; Editing by Sriraj Kalluvila and Josie Kao)

By David Gaffen

NEW YORK (Reuters) – Oil prices surged nearly 3% on Wednesday, bolstered by record U.S. crude exports and as the nation’s refiners operated at higher-than-usual levels for this time of year.

The dollar’s weakness added support, as the greenback’s strength of late has been a notable factor inhibiting oil market gains.

Brent crude futures settled up $2.17, or 2.3%, to $95.69 a barrel. U.S. West Texas Intermediate (WTI) crude rose $2.59, or 3%, to $87.91.

The U.S. dollar fell 1.2%, making oil cheaper for holders of other currencies. The U.S. greenback has been stronger than other key foreign currencies as the U.S. Federal Reserve has been more aggressive about raising rates. [USD/]

“Across the board this is a dollar-denominated move, and if you try to read outside out of that, it’s foolish,” said Eli Tesfaye, senior market strategist at RJO Futures.

U.S. crude stocks rose 2.6 million barrels last week, according to weekly government data, more than anticipated, but that was lower than industry figures, which showed a 4.5 million-barrel build.

Crude exports rose to 5.1 million barrels a day, the most ever, dropping net U.S. crude imports to their lowest in history.

“Overall, thanks to the export market, this turns into a bullish report despite a medium-sized build in commercial crude inventories,” said John Kilduff, partner at Again Capital in New York.

Traders attributed the surge in exports to the widened WTI-Brent spread, which, coming into Wednesday’s trade, was at more than $8 per barrel.

U.S. refining rates remained steady at nearly 89% of capacity, the highest for this time of year since 2018.

The Organization of the Petroleum Exporting Countries surprised markets with a larger-than-expected cut to its output targets earlier this month. Oil analysts anticipate supply will tighten in coming months after that move, and as Europe is expected next month to ban oil imports from Russia and restrict Russian shippers from the global shipping insurance industry.

That ban may tighten world shipping markets, which could also increase the price of oil. Many analysts believe Russia will be able to circumvent the measures, but it could still cause Moscow to shut between 1 million and 2 million barrels of daily production; it could as well hit the distillates markets.

“Until 2024 we believe oil price will be strongly influenced by the availability of tankers that are willing to transport Russian oil rather than global supply-demand fundamentals, keeping oil price elevated,” JP Morgan analysts wrote.

(Reporting by David Gaffen; Additional reporting by Laura Sanicola, Shadia Nasralla and Rowena Edwards; Editing by Marguerita Choy and Cynthia Osterman)

By Erwin Seba

HOUSTON (Reuters) -U.S. oil refiner Phillips 66 has begun reducing staff at several refineries, refined products terminals and offices as part of a restructuring program, said two people familiar with the matter.

Phillips 66 spokesperson Bernardo Fallas confirmed that some jobs were being eliminated at the company.

“Phillips 66 is undergoing a companywide effort to optimize its cost structure and reimagine its operating model to enable sustainable savings,” Fallas said. “As a result of this effort, some employees have been given new assignments in their current location, while some have been offered positions at other sites and some positions have been eliminated.”

Fallas offered no other details about the layoffs.

The job cuts affect a small number of salaried employees in management and upper-level technical services workers at several locations. A small number of hourly workers also will lose their jobs, the people said.

Some salaried employees at refineries in Sweeny, Texas, Ponca City Oklahoma and Wood River, Illinois, have been told their jobs are being eliminated, the people said. It was not clear how many positions were being eliminated across its operations.

Phillips 66 in July under new Chief Executive Mark Lashier said it would cut at least $700 millionin expenses to “remain competitive in any market environment” and prepare for the transition to renewable and cleaner energies from fossil fuels.

While reaping record profits, Phillips 66 and other U.S. refiners have launched cost reduction programs, said Matthew Blair, head of chemicals, refiners and renewable fuels research at Tudor, Pickering, Holt & Co.

The job cuts now underway “would likely fit that plan,” said Blair.

Earlier this year, Phillips 66 laid-off nearly all of the 450 employees at a shuttered oil refinery in Louisiana as it converted the hurricane-damaged plant to a products terminal.

The company’s third-quarter results are expected to benefit from strong demand for motor fuels. Analysts expected adjusted per share profit of $5.03, up from $2.94 in the same quarter a year ago when results are released on Nov. 1, according to Refinitiv IBES.

(Reporting by Erwin Seba; editing by Diane Craft)