ExxonMobil profits to take $2bn hit from lower natural gas prices
ExxonMobil’s profits will be hit by weaker natural gas prices as commodity markets normalise after a bumper 2022 for the energy supermajor.
The company said on Wednesday that lower gas prices would knock $1.8bn to $2.2bn off earnings in the April to June period in its upstream business compared with the previous quarter. Weaker refining margins will reduce downstream profits by $2bn to $2.2bn.
The oil major made a profit of $11.4bn in the first quarter after a record-breaking 2022, when Russia’s full-scale invasion of Ukraine sent oil and gas prices soaring.
Bank of America increases quarterly dividend by 9% after stress test results
Bank of America increased its quarterly dividend by 9 per cent to 24 cents a share on Wednesday.
The move makes BofA the latest big lender to increase its dividend in the wake of positive annual banking stress test results that were released last week.
Unlike its rivals, BofA decided to hold off on immediately increasing its dividend because of a discrepancy between the Federal Reserve’s stress test and its own, which showed higher losses than the one conducted by regulators.
On Monday, BofA said it had contacted the central bank to understand the discrepancy. As of Wednesday the bank said discussions with the Fed were ongoing.
Canada suspends advertisements on Facebook and Instagram
The Canadian government has suspended advertisements on Facebook and Instagram after parent company Meta’s decision to block news content in the country.
Meta pulled news from its platform in response to a new Canadian law passed in June forcing online groups to pay publishers for carrying their content. Google has vowed to block news on its website though both companies continue to negotiate with the Canadian government.
“We believe we have a path forward,” said heritage minister Pablo Rodriguez at a news conference on Wednesday.
Although Rodriguez is “deeply convinced” that Google’s concerns will be resolved, he slammed Meta’s latest move as “unreasonable and irresponsible”.
Fed signals determination to raise interest rates after June pause
Federal Reserve officials signalled they intend to resume interest rate increases amid a growing consensus that more tightening is needed to stamp out high inflation in the world’s largest economy.
According to minutes from June’s meeting of the Federal Open Market Committee, “almost all” officials who participated said that “additional increases” in the Fed’s benchmark interest rate would be “appropriate”.
They added that the “tight” labour market and “upside risks” to inflation were still “key factors” shaping the outlook nearly a year and a half after the US central bank embarked on an aggressive cycle of interest rate rises to tame price pressures.
Read more about the Fed’s rates policy here.