Business

May 6 (Reuters) – Continental expects a blow in the “mid to high double-digit million euro” range should higher U.S. import tariffs recently announced by President Donald Trump apply to tyres, its finance chief said on Wednesday.

Car parts makers in Europe are facing renewed pressure as Trump last week announced a tariff increase on cars and trucks from the European Union to 25% from the previously agreed 15%, saying the bloc had not complied with its trade deal with Washington.

Continental finance chief Roland Welzbacher told Reuters that the new tariffs were not included in the company’s forecasts and that the firm was still waiting for details before taking further actions.

He said the expected additional burden “would require again to think about measures to offset this cost like we did last year. So we need to focus on cost savings, and obviously we also need to think about commercial measures”.

(Reporting by Emanuele Berro and Simon Ferdinand Eibach, editing by Christoph Steitz)

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May 6 (Reuters) – Tesla is recalling 218,868 vehicles in the U.S. due to delayed rearview camera images that could increase the risk of a crash, the National Highway Traffic Safety Administration (NHTSA) said on Wednesday. 

The regulator said the rearview camera display in affected vehicles may be delayed when the car is put into reverse, reducing driver visibility.

The recall covers certain Model 3, Model Y, Model S, and Model X vehicles, it said.

Tesla has released an over-the-air software update to address the issue.

Last month, the NHTSA closed a probe into about 2.6 million Tesla vehicles over a feature that allowed cars to be moved remotely, after finding it was linked only to low-speed incidents.

(Reporting by Ananya Palyekar in Bengaluru; Editing by Rashmi Aich)

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By Howard Schneider

WASHINGTON, May 6 (Reuters) – The release of transcripts of Federal Reserve rate-setting meetings, a cornerstone of its transparency for more than 30 years, undermines the debate needed to set good monetary policy, incoming U.S. central bank chief Kevin Warsh says in an upcoming book, remarks that echo his wider desire to overhaul the Fed.

Warsh, in a 2023 interview with New York University Stern School of Business Professor Simon Bowmaker, advocated limiting the taped sessions and published transcripts to a final “decision round of discussions” where officials can spell out the rationale for their policy votes.

Policymakers “do not want to appear wrong with the benefit of hindsight, and so they instinctively tend to hedge their bets” when their comments are taped for release, Warsh told Bowmaker for his book, “Fed Reckoning: Conversations on America’s Central Bank,” to be published early next year.

Warsh, who served as a Fed governor from 2006 to 2011, went into detail about a study he conducted for the Bank of England, where “as a result of the work I did in 2014, the recording device has been turned off” for the initial round of policy meetings to allow for more free-flowing discussions, while offering more public disclosure of the actual policy votes by releasing transcripts of the day-two proceedings.

“The tape recorder, however, still looms large at the Federal Reserve … If we want that deliberation to be robust, we need a family fight. If people think the decision is 60–40 one way, I would prefer them to argue as if it were 95–5. I want to hear the best arguments,” Warsh said in the interview, which was shared with Reuters.

The Fed since the early 1990s has released full transcripts of its two-day sessions after a five-year delay, with the lag considered a compromise between public transparency and the concern that quicker release would stifle debate.

Though U.S. central bank officials have unvarnished discussions with each other – outgoing Fed Chair Jerome Powell is known for his extensive canvassing of colleagues before meetings – “it would be preferable if the fierce deliberation happened among a larger group. So, if you want sound policy decisions, you have to create an environment in which sound policy fights can happen,” said Warsh, who is expected to be confirmed as the next Fed chief by the U.S. Senate this month.

The 56-year-old lawyer and financier said the second day of discussions, by contrast, “should be recorded,” and “the transcript should be made available because it is a judgment of what each member believes and his rationale. The historical record should ensure accountability for the decisions.”

REVERSING THE TRANSPARENCY TREND?

Warsh did not respond to questions from Reuters about changes he may seek in the Fed’s handling of transcripts or other communications policies that he recently told the Senate Banking Committee needed retooling to encourage “messier meetings” and “a good family fight.”

But his comments for Bowmaker’s book echo longstanding critiques Warsh has made about Fed communications he feels were an obstacle to responding faster to rising inflation following the COVID-19 pandemic.

Changing the policy on transcripts would rehash a controversial moment for the Fed. In the early 1990s it was revealed that, unbeknownst even to many at the central bank, meetings were not just recorded – a longstanding practice to help render minutes, with the tapes then erased – but that since 1976 the recordings had been transcribed and the transcripts retained.

The revelation drew comparisons to former U.S. President Richard Nixon’s secret White House recordings, and added to pressure building among Democrats then in control of Congress for the Fed to change the aura of secrecy around its crafting of monetary policy.

Former Fed Vice Chair Donald Kohn, a long-serving U.S. central banker involved as a staff member in the initial discussions about how to treat the transcripts, said that along with the value to historians, the recordings are important in the creation of meeting minutes. While noting that Warsh’s point about Fed debates isn’t inaccurate, Kohn said policymakers’ greater reliance on prepared statements after the decision to release the transcripts meant that their level of preparation also increased.

“Did it impede discussion? Yes, to some extent,” Kohn said, but the practice among recent chairs of hearing out policymakers ahead of time “takes away spontaneity too … His thing about messier meetings suggests there may be less of that beforehand.”

Another change could involve the press conferences that Powell has held eight times a year after each policy meeting – his immediate predecessors, Janet Yellen and Ben Bernanke, held them on a quarterly basis, while former Fed Chair Alan Greenspan held none.

Warsh also may seek to curtail or eliminate the release of the Fed’s quarterly economic projections, which he feels are a form of constraining “forward guidance.” During his April 20 confirmation hearing he did not rule out reducing the number of meetings, which the law permits to be as few as four annually.

Fed communications “are not a light switch, on and off, it’s a dial. Powell was incredibly transparent … Should Warsh be confirmed, it will be turned down a few notches,” said Michael Arone, chief investment strategist at State Street Investment Management. “As a consumer of information, more is better than less. It would increase the risk of misinterpretation. It may increase the volatility around expectations.”

The release of the first transcripts marked the start of steadily expanding efforts by the Fed to both de-mystify its arcane world and leverage the power of public communications to improve policy effectiveness. The better central bankers explain themselves, and the more they are trusted, the faster and more effectively their rate decisions will be felt in the economy, the argument goes.

Dialing back what’s recorded and released would not just reverse the usual bias towards greater disclosure, which for the Fed has included more expansive policy statements, regular press conferences, and frequent public speeches by Fed officials. It might also resurface some of the old suspicions about the Fed at a time when U.S. President Donald Trump seeks more influence over it, said Sarah Binder, a political science professor at George Washington University and author of a history about the Fed and politics.

Changes on disclosure “are hard to take back … The big, broad movement at the Fed is from very little transparency to a pretty broadly transparent institution where the members like to explain themselves because they think it is helpful in setting expectations,” Binder said. “The moment it becomes known that they are turning off the tape recorder, suspicions grow. How did they reach that decision? People’s minds can go pretty conspiratorial.”

(Reporting by Howard Schneider; editing by Dan Burns and Paul Simao)

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By Lewis Krauskopf

NEW YORK, May 6 (Reuters) – A humming U.S. corporate profit engine is at the heart of the U.S. stock market’s rally to record highs – an encouraging sign for investors as long as the fuel driving profits keeps flowing.

More than two-thirds through the first-quarter reporting season, S&P 500 companies are on track for their highest quarterly earnings growth in more than four years. Future projections are also growing rosier: Analysts’ estimates for future 12-month U.S. earnings have risen by over 10% since the start of the year, according to LSEG Datastream.

As some of the worst-case economic fears tied to the war in Iran have receded, investors said Wall Street has been able to focus on the earnings strength, helped by massive investments in artificial intelligence technology and a generally solid economic backdrop.

“Because things have not gotten worse and the ceasefire has been in place for some time now, it’s been earnings that have driven the move higher,” said Chris Fasciano, chief market strategist at Commonwealth Financial Network.

The benchmark S&P 500 is up 6% for the year, building on three straight years of solid double-digit percentage gains. The index has surged more than 14% since March 30, following a swoon sparked by the start of the U.S.-Israeli war with Iran.

STRONGEST QUARTER IN 20 YEARS?

Investors had expected generally solid results when the reporting season kicked off last month, but they have far surpassed expectations. S&P 500 earnings are expected to have jumped 28.2% in the first quarter from a year earlier, including results from 350 index companies that have reported and analysts’ estimates for those yet to report, according to data as of Tuesday from Tajinder Dhillon, head of earnings and equity research at LSEG Data & Analytics.

That increase would be the highest since the fourth quarter of 2021, when businesses were recovering from pandemic lockdowns.

“Excluding special factors like favorable base effects and corporate tax cuts, earnings growth is arguably the strongest in two decades,” Binky Chadha, chief U.S. equity strategist at Deutsche Bank, said in a note.

Projections for the rest of 2026 are also rising. S&P 500 earnings are expected to jump 22.6% for the full year 2026, with estimates higher for each of the next three quarters than they were on April 1, according to LSEG IBES.

Companies still to report this period include semiconductor giant Nvidia, major retailers including Walmart and Home Depot, and software company Salesforce.

NOT JUST AN AI BOOST

The massive investments by technology companies to support AI applications is a key factor supporting U.S. profits. Five AI hyperscalers are expected to lay out $751 billion in capital expenditures in 2026, according to Goldman Sachs strategists, as the companies pour resources into data centers and other infrastructure.

Companies and industries that are AI beneficiaries have increased first-quarter earnings by 50%, Deutsche Bank said in a report on Monday, including semiconductor companies and other tech hardware firms, as well as electrical equipment and construction companies.

AI has been “a tree that spreads a lot of limbs out,” said Chuck Carlson, CEO at Horizon Investment Services. “That spending that is going on in that space is really a pretty significant driver.”

Investors also point to broadly solid earnings amid a stable economic backdrop. Median company earnings growth has been 12.2%, according to Deutsche Bank, while Morgan Stanley strategists note the median S&P 500 company earnings surprise is the strongest it has been in four years. Nine of the 11 S&P 500 sectors are on pace for higher first-quarter earnings, with eight each up at least 10%, according to LSEG IBES.

Companies are showing they can weather the war-related energy price surge that has sent oil prices over $100 a barrel, said Keith Lerner, chief investment officer at Truist Advisory Services.

“It’s definitely hurting some businesses, but companies have gone through so many shocks, they are more equipped to just be able to be agile when these things happen,” Lerner said.

MARKET VALUATION MODERATES AS EARNINGS RISE

The strength in earnings has helped stocks rise even as the market’s valuation has moderated. While still well above its long-term average of 16, the S&P 500’s price-to-earnings ratio was at 21.2 times expected 12-month earnings, according to LSEG Datastream. That is down from the 23.5 level it reached in late October.

Markets are no longer pricing in equity-friendly rate cuts this year, amid energy-driven higher inflation, pressuring stock valuations and raising the stakes for strong earnings growth.

As investors weigh the likelihood of earnings staying strong, they will be watching the AI theme and any signs of pullback from the leaders in the field.

The Middle East war remains at the forefront for investors, who worry about more significant fallout for businesses and consumers the longer the conflict goes on and keeps energy and other prices elevated.

“For the moment, I think investors are willing to sort of ride the wave of strong earnings and generally decent economic news,” said Robert Pavlik, senior portfolio manager at Dakota Wealth Management. “Eventually, $4.50-a-gallon gasoline is going to catch up to the economy, you would imagine.”

(Reporting by Lewis Krauskopf; editing by Megan Davies and Rod Nickel)

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May 6 (Reuters) – Wall Street futures climbed on Wednesday, buoyed by hopes of a U.S.-Iran peace agreement and unrelenting optimism around artificial intelligence.

The rally, which took the S&P 500 and the Nasdaq Composite indexes to record highs on Tuesday, showed few signs of easing after Advanced Micro Devices forecast second-quarter revenue above expectations, helped by robust demand for its data-center chips.

“Wall Street continues to double down on its bet that the war in the Middle East will not re-escalate and disrupt the market’s earnings-driven surge to all-time highs,” said Kyle Rodda, senior financial market analyst at Capital.com.

“The signals sent from the United States appear to offer reassurance that it’s not interested in renewing hostilities.”

U.S. President Donald Trump said “great progress” had been made toward a peace agreement with Iran, while Tehran said it will only accept “a fair and comprehensive agreement.”

Oil prices fell for a second consecutive day, with Brent crude futures slipping 3.3%.

The gains reflect rising risk appetite among investors, provided corporate earnings remain strong and hopes for a peace deal stay alive.

But the more the stocks rise, the greater is the chance of a pullback if the diplomatic efforts to end the Iran war derails.

At 4:43 a.m. ET, Dow E-minis rose 126 points, or 0.25%, S&P 500 E-minis gained 23.25 points, or 0.32% and Nasdaq 100 E-minis were up 228 points, or 0.81%.

AMD jumped 18.1% in premarket trading, while rival Intel rose 6.1%. Super Micro also jumped 17.7% following a stronger-than-expected forecast for fourth-quarter revenue and adjusted profit.

Alphabet jumped 1.4%, narrowing the gap with Nvidia in the race to become the biggest company by market value. Nvidia rose 0.44%.

Arm Holdings gained 11.3% ahead of its quarterly results.

(Reporting by Niket Nishant in Bengaluru; Editing by Arun Koyyur)

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May 5 – The United States has issued a general license authorizing legal, financial advisory, and consulting services linked to potential debt restructuring in Venezuela, including the South American country’s state oil company Petroleos de Venezuela (PDVSA) and entities majority owned by it, according to a posting on Tuesday on the Treasury Department website. 

“Authorized legal, financial advisory, and consulting services in connection with potential debt restructuring include the assessment, development, orpreparation of debt restructuring options, proposals, and related supporting materials” are allowed under the license, it said.

The license does not authorize any restructuring or settlement of debt by the government or PDVSA, or direct negotiations between the government and creditors regarding restructuring, the license added.

(Reporting by Bhargav Acharya, Katharine Jackson and Julia Symmes Cobb; Editing by Doina Chiacu)

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By Inti Landauro

BRUSSELS, May 5 (Reuters) – Tesla’s aim to roll out its supervised “full self-driving” software in Europe got a boost from Belgium on Tuesday, where the Flanders region said it was looking into whether it can quickly adopt it following approval in the Netherlands.

The Netherlands’ regulator provisionally approved the use of the software on Dutch roads last month, making it the first country in the EU to allow the software, which can control a car but requires drivers to pay attention.

Annick De Ridder, the transport minister for Flanders, the mainly Dutch-speaking half of Belgium which borders the Netherlands, said in a post on X that she had asked Tesla to provide documents so as to possibly follow suit in her region.

Her team would make clear by the end of the week whether a fast-track approval is possible, De Ridder added.

“Because you shouldn’t slow down innovation, but make it possible in a thoughtful and safe way. This way, we keep Flanders at the forefront as a forward-thinking region,” she said in her post.

Tesla CEO Elon Musk has projected confidence that the EU will soon green-light its FSD, though several regulators in countries such as Sweden, Finland, Denmark and Norway have shown skepticism toward the technology and its stated safety ​benefits.

A spokesperson for Belgium’s central transport ministry said the issue was up to regions and not a matter for the central government.

Tesla has also filed a request to Belgium’s other main region, mainly French-speaking Wallonia, its ministry said. A spokesperson for Brussels, the capital, which is a separate third region, did not immediately respond to a request for comment.

(Reporting by Inti Landauro, Marie Mannes and Chris KirkhamEditing by Philip Blenkinsop and Peter Graff)

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SAN FRANCISCO (AP) — The man accused of throwing a Molotov cocktail at the San Francisco home of OpenAI CEO Sam Altman pleaded not guilty Tuesday to charges of attempted murder and attempted arson.

Daniel Alejandro Moreno-Gama, wearing an orange jail uniform, did not speak as his attorney entered the pleas during his arraignment in state court. The 20-year-old also faces federal charges.

Moreno-Gama, of Spring, Texas, hurled the flammable bomb at Altman’s home last month, setting an exterior gate alight before fleeing on foot, authorities allege. Less than an hour later, he went to OpenAI’s headquarters about 3 miles (5 kilometers) away and threatened to burn down the building, they say.

Diamond Ward, the public defender representing Moreno-Gama, said after the hearing that her client was experiencing a mental health crisis and had been excessively charged.

“Daniel is a kind, hard-working person who has been publicly advocating for peaceful measures to address the danger of AI on humanity,” she said.

She attributed Moreno-Gama’s actions to “a mental health crisis and not any desire to harm” and suggested prosecutors were trying to curry favor with Altman and were ignoring evidence of her client’s mental health issues.

During the hearing, Ward requested a mental health evaluation for Moreno-Gama. The judge granted the request and scheduled another hearing for later this month to discuss the results.

San Francisco District Attorney Brooke Jenkins said last month that Moreno-Gama carried out a “targeted attack on Mr. Altman” and that prosecutors had evidence to substantiate the charges.

Moreno-Gama’s parents said in a statement shortly after the attack that he has never harmed anyone and recently began having mental health issues.

Authorities said Moreno-Gama, who works part-time at a pizzeria and is attending community college, expressed hatred of artificial intelligence in his writings, describing it as a danger to humanity and warning of “impending extinction,” according to court filings.

Officials haven’t said whether Altman was home at the time of the attack.

The state charges, which also include attempted arson and attempted criminal threats, carry penalties ranging from 19 years to life in prison.

Federal prosecutors charged Moreno-Gama with possession of an unregistered firearm, and damage and destruction of property by means of explosives. Those charges carry respective maximum prison sentences of 10 years and 20 years.

Moreno-Gama made an initial appearance in federal court on Friday.

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This story was updated to correct the spelling of Moreno-Gama’s last name.

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WASHINGTON, May 5 (Reuters) – The sole Democrat on the Federal Communications Commission on Tuesday called for a rigorous review of the foreign ownership interests in a proposed Paramount-Warner Bros. Discovery merger.

Last month, Paramount Skydance asked the FCC to greenlight foreign investments backing its acquisition of Warner Bros Discovery. FCC Commissioner Anna Gomez said there are “serious, unresolved questions about how this foreign investment may jeopardize national security, and this commission has a legal obligation to answer them.”

She noted the deal involves sovereign wealth funds from Saudi Arabia, Qatar, and Abu Dhabi investing in a company that would control CBS stations, as well as major cable news operations including CNN.

(Reporting by David Shepardson)

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Lawyers for Spirit Airlines returned to a U.S. bankruptcy court in New York on Tuesday to seek approval for dismantling the once-busy budget carrier and turning its parts into cash for creditors.

The liquidation marks a dramatic turn for Spirit, which filed for bankruptcy protection in August 2025 hoping to escape financial ruin. The airline’s parent company was attempting to restructure the business for the second time since November 2024 when it abruptly stopped operating flights over the weekend.

Since the going-out-of-business announcement early Saturday, lawyers filed a series of court motions laying out a rapid wind-down plan centered on selling off every possible Spirit asset, from airplanes and engines to spare parts — and limiting additional payroll, leasing and other costs.

The shutdown itself was tightly choreographed. The company, Spirit Aviation Holdings Inc., said it made its announcement in the middle of the night to ensure the jetliners making their final runs for the airline were safely on the ground and their crews accounted for.

Three days later, the sense of urgency carried into U.S. Bankruptcy Court, where the company’s lawyers were asking a judge to move quicky. They asked for expedited approval of the proposed wind-down plan, arguing that speed would benefit Spirit’s creditors and customers.

“Any delay will cause chaos, confusion and cost the estate significant time and money,” one motion stated, noting the airline was “not generating any revenue.”

Spirit attorney Marshall Huebner said during a Tuesday court hearing that rising jet fuel costs since the U.S. and Israel launched strikes on Iran “engulfed Spirit entirely.”

The airline’s fuel expenses grew by oughly $100 million “in March and April alone,” and rapidly drained Spirit’s liquidity and derailed its restructuring efforts,” Huebner said.

He apologized directly to Spirit’s employees and customers, especially passengers who he said may now be completely “priced out” of certain routes without the ultra low-cost carrier.

Huebner described a swift effort by other airlines and other segments of the aviation industry to assist Spirit’s employees and customers once the airline’s end looked inevitable.

“The entire industry sprang into action to get our people home,” Huebner said. Spirit employed about 17,000 people and carried about 50,000 passengers on its final day of operations. The final flight, which traveled from Detroit to Dallas, landed after midnight Saturday.

With its planes grounded, Spirit said it planned to keep a skeleton crew of about 150 employees initially, eventually shrinking to roughly 40. The group, largely made up of veteran staff and executives, including some “senior management employees,” will be responsible for securing aircraft, coordinating logistics and overseeing the liquidation process.

The company also was seeking Judge Sean Lane’s approval to provide retention incentives to keep those workers in place through the liquidation.

In the last two weeks, Spirit was in discussions with the Trump administration about a hoped-for rescue deal that fell through, eliminating what the company described as its last viable path forward. Of the potential bailout, Transportation Secretary Sean Duffy said Saturday, “We oftentimes don’t have half a billion dollars laying around.”

Duffy said other U.S. airlines, including United, Delta, JetBlue and Southwest, were offering $200 one-way fares for a limited time to travelers holding Spirit confirmation numbers and proof of purchase.

Airlines also stepped in to assist stranded Spirit crew members, he said, with some offering a preferential hiring process for former Spirit employees looking for work.

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