Category: 3. Business

The Nasdaq and S&P 500 fell on Wednesday as investors sold tech stocks and moved into less highly valued sectors, as they also awaited remarks from Federal Reserve officials at their Jackson Hole symposium this week.

Tech stocks, which drove much of the recovery from Wall Street’s April selloff, have been pulling back. The S&P 500 technology index was down on the day, while sectors such as energy, healthcare and consumer staples rose.

“A broader lens tells you it’s more of a rotation than a true sell off,” said Allspring’s senior portfolio manager, Bryant van Cronkhite. “Tech valuations look extended in the context of inflated spending today. Number two, I would say that there are a lot of pockets of the market that look very attractive from a valuation standpoint and they’ve been broadly ignored.”

According to preliminary data, the S&P 500 lost 16.40 points, or 0.26%, to end at 6,394.97 points, while the Nasdaq Composite lost 144.76 points, or 0.68%, to 21,170.19. The Dow Jones Industrial Average rose 1.48 points, or 0.00%, to 44,923.75.

Analysts listing other factors behind the tech sell-off mentioned OpenAI CEO Sam Altman’s comments last week about artificial intelligence stocks being “in a bubble,” and a Massachusetts Institute of Technology study that showed many tech companies were struggling to translate AI into actual profits.

Some investors also worried about government interference in the private sector. President Donald Trump’s administration is looking into taking equity stakes in chip firms such as Intel, weeks after unprecedented revenue-sharing deals with Nvidia and AMD.

Nvidia, Advanced Micro Devices, Intel and Micron fell. Nvidia’s quarterly results on August 27 are keenly awaited for clues on demand for artificial intelligence.

Other megacap growth names such as Apple and Meta also came under pressure.

Minutes from the Fed’s July meeting, where interest rates were left unchanged, showed almost all policymakers viewed it as appropriate to maintain the target range for the federal funds rate at 4.25% to 4.50%, despite two dissenters.

Fed Chair Jerome Powell is expected to speak on Friday at the central bank’s annual conference in Jackson Hole, Wyoming. His remarks will be closely watched for policy signals. Investors have been pricing in a 25-basis-point rate cut in September, according to data compiled by LSEG.

Meanwhile, investors also monitored Trump’s call for the resignation of Fed Governor Lisa Cook, with the president citing allegations that she was involved in mortgage fraud.

Earnings from big retailers, seen as a barometer for the health of the American consumer, are also due this week as sentiment has taken a hit from concerns that tariffs could drive prices higher.

Target tumbled after the company named a new CEO and retained its annual forecasts that were lowered in May.

Cosmetics giant Estee Lauder fell after tariff-related headwinds weighed on its annual profit forecast.

AIA Group Ltd. reported strong growth in new business value in the first half of the year, underpinned by insurance sales in Hong Kong, as the firm hiked its dividend.

The measure of future profitability of new policies sold rose 16% to $2.84 billion in the six months, from $2.46 billion a year earlier, the Hong Kong-based insurer said in a statement on Thursday. The board increased its interim dividend by 10% to 49 Hong Kong cents per share.

Louisiana regulators approved Entergy Corp.’s plan to build three natural gas plants to power Meta Platform Inc.’s biggest data center.

Meta’s latest and largest data center is a 4 million–square–foot complex in rural Louisiana intended to support the company’s most powerful artificial intelligence models. Meta Chief Executive Officer Mark Zuckerberg has said the facility, dubbed Hyperion, will near the size of Manhattan. At full capacity it is expected to consume as much as 5 gigawatts of electricity.

By Saeed Azhar

NEW YORK (Reuters) -Bank of America promoted Faiz Ahmad and Mike Joo to co-heads of global investment banking as part of a broader leadership reshuffle in the business, according to an internal memo seen by Reuters on Wednesday.

All of the investment bank’s global group heads will now report jointly to Ahmad, who was previously co-head of global capital markets, and Joo, formerly its head of North America global corporate and investment banking (GCIB).

The outgoing heads of investment banking, Alex Bettamio and Thomas Sheehan, become chairs of GCIB, tasked with deepening client relationships globally, according to the memo by Matthew Koder, president of the division.

Bank of America’s global investment banking revenue was ranked third-highest in 2025, according to Dealogic data in mid-August. It had 6% market share, versus 6.1% last year.

The bank fell from fourth to fifth in M&A rankings, the data showed. Its market share in equity capital markets fell slightly, but grew in debt capital markets and loans.

BofA’s investment banking fees slid 9% to $1.4 billion in the second quarter, lagging rivals.

Joo will continue to prioritize BofA’s U.S. middle market presence to improve integration of the business across 97 local markets, the memo said.

Middle market mergers and acquisitions – valued between $500 million and $2 billion – have become an expanding business for investment banks in the U.S.

The bank also named Karim Assef as chair of global investment banking.

It appointed Lisa Clyde as co-head of global capital markets, alongside Sarang Gadkari, and picked Brendan Hanley as head of global corporate banking and leasing.

(Reporting by Saeed Azhar; additional reporting by Tatiana BautzerEditing by Rod Nickel and Lananh Nguyen)

Understanding GenAI’s impact on risk management

By now, most of us have experienced both the power and unpredictability of generative AI. Systems like ChatGPT can produce original content, including text, images, code, and video, by learning patterns from information found online. Naturally, this technology has quickly made its way into the workplace. In some cases, GenAI was introduced thoughtfully with a specific purpose in mind, or through software updates that incorporated GenAI capabilities. As the practice of including GenAI in our workflows and in the software we use everyday increases, we must be aware of the inherent risks that GenAI introduces. Let’s explore the major risk categories, such as strategic, operational, technological, compliance, and reputational risks, that we must address before adopting GenAI into our workplace.   

Strategic risk

While generative AI capability brings immense value, it also carries significant risk. Strategically, organizations may find themselves overly reliant on AI-generated outputs without fully understanding their limitations. Decisions influenced by flawed AI models or inaccurate outputs can misalign with long-term objectives, resulting in costly missteps. Further, the assumption that generative AI will automatically create efficiencies or new opportunities may result in overinvestment in tools that lack sufficient governance or business alignment.

Operational risk

Generative AI tools can introduce hidden vulnerabilities. One of the most pressing concerns is data leakage. Employees may unintentionally share confidential or proprietary information with publicly available AI tools that can retain and use that data to train future models. Additionally, these models are prone to what experts call “hallucinations,” where the AI generates content that appears plausible but is entirely incorrect. In highly regulated industries, such as those in the legal, financial, or medical sectors, this can lead to significant errors, cause harm to individuals, or result in compliance violations.

Technology risk

We also need to understand the risks associated with shadow AI. In some cases, generative AI is quietly introduced through existing software updates without the organization’s knowledge. In other instances, employees may purchase and use their personal GenAI accounts at work. In either case, the pace of deployment could bypass traditional software vetting and change management practices, meaning these tools are integrated into workflows without adequate oversight or testing.

Compliance risk

Governments and regulatory bodies are enacting frameworks governing AI. The European Union’s AI Act, U.S. executive orders, and emerging guidelines from agencies such as the FTC and SEC are placing new obligations on organizations to ensure transparency, accountability, and fairness in their use of AI. At least in part, this is because many generative models are trained on datasets that may include copyrighted material, personally identifiable information (PII), or biased content, raising concerns around intellectual property rights, data protection, and discriminatory outcomes. Organizations using third-party AI platforms must also contend with heightened third-party risk, especially when vendors fail to disclose their training data or model architecture.

Reputational risk

Perhaps the most difficult category of AI risk to quantify is reputational. A single misuse of generative AI can quickly escalate into a public relations crisis, particularly if it involves customer-facing content, intellectual property, or a breach of trust through the disclosure of confidential information. Trust is hard to regain once lost. Inappropriate, biased, or misleading content generated by AI can damage customer loyalty, investor confidence, and employee morale. Internally, poor communication about AI policies and controls can breed fear, confusion, or resentment among staff, especially if employees view AI as a threat to their roles.

The European Commission is pursuing a €376 million fine against Intel for anticompetitive practices from two decades ago, when the company paid manufacturers to delay products with AMD chips. This enforcement action reveals a fundamental disconnect: while Brussels relitigates decades-old violations against an allied-based company struggling for its very existence, China is investing hundreds of billions to dominate tomorrow’s semiconductor industry.

Intel today bears no resemblance to the dominant firm that committed these purported violations and went from dominance to struggling for survival in the time it took this case to wind through the courts. When these violations occurred, Intel dominated the PC market with over 80 percent share. Today, it has largely surrendered the smartphone chip market to Qualcomm and is struggling to leverage AI opportunities. Nvidia is now worth $3 trillion, while Intel’s market cap has fallen to $110 billion. Even in its core CPU business, AMD continues to gain ground, all the while the world has shifted to the dominance of the fabless business led by TSMC.

The numbers don’t lie. Intel now outsources 30 percent of its chip production to Taiwan’s TSMC, a stark admission of its manufacturing struggles. The company’s stock plummeted 60 percent in 2024, its worst year on record, forcing its CEO to resign and leading to its removal from the Dow Jones Industrial Average. Intel is now cutting 25,000 jobs and implementing $10 billion in cost reductions to stabilize its finances.

Yet Intel isn’t finished. The company remains the largest x86 processor maker, retains significant R&D capabilities, and its forthcoming 18A process technology could restore some competitive edge. Intel also plays a critical role in the U.S. and European semiconductor supply chain resilience, something that would vanish if the company fails.

Deterrence matters in competition enforcement, but cases this old do little to shape future corporate conduct, especially in a sector where market leadership can change in less than a decade. At some point, precedent-setting becomes academic while industrial stakes remain real. In this specific case, pursuing a fine for 20-year-old conduct against a potentially fatally weakened company achieves little other than inflicting more harm.

These harms include lessened EU competitiveness. Europe’s semiconductor strategy relies on private partners capable of making multibillion-euro investments. Intel recently canceled its planned €30 billion factory in Germany and a €4.6 billion facility in Poland, citing financial pressures and market conditions. The German government had allocated €10 billion in subsidies for the Magdeburg plant—funding which now sits idle. The €376 million fine adds financial pressure at the wrong moment, when Intel is already struggling to fund European investments.

Doubling down on a large Intel fine also ignores that the EU and the United States are in an industrial competition where China explicitly uses economic policy as a strategic weapon. While the EU is chasing after this old fine, China is pouring massive subsidies into semiconductor manufacturing, backed by forced technology transfer and industrial espionage. Beijing views semiconductors not just as commercial products but as tools of geopolitical power.

A competition policy premised upon uncontested Western technological leadership is inadequate for today’s reality. Enforcement actions that weaken Western industrial capacity while China builds its capabilities directly advance Beijing’s strategic objectives. The Commission needs to recognize this new context rather than mechanically pursuing a case from a bygone era. Antitrust enforcement that damages Western champions only serves Chinese competitors, not consumers.

The Commission faces a straightforward choice. It can continue pursuing violations from 2002, when Intel dominated desktop computing and smartphones didn’t exist. Or it can recognize that semiconductor competitiveness against China matters more than relitigating ancient history. A nominal fine would acknowledge the violations while avoiding damage to Western technological sovereignty.

Europe can’t afford to weaken allied chipmakers while Beijing builds and takes tomorrow’s capacity. The question isn’t whether Intel violated competition law twenty years ago. The question is whether the West will have competitive semiconductor manufacturing tomorrow.

The sackings come as Health and Human Services Secretary Robert F Kennedy Jr pushes to significantly downsize department.

At least 600 employees of the Centers for Disease Control and Prevention (CDC) in the United States are receiving permanent termination notices in the wake of a recent court decision that protected some CDC employees from layoffs but not others.

The notices went out this week, and many people have not yet received them, according to the American Federation of Government Employees (AFGE), which represents more than 2,000 dues-paying members at CDC.

The CDC played a crucial role in gathering data and setting health policy during the COVID-19 pandemic.

The terminations come months after Department of Health and Human Services (HHS) Secretary Robert F Kennedy Jr announced efforts to let go of 20,000 employees, downsizing the department by more than 20 percent.

AFGE officials said they are aware of at least 600 employees being cut.

But “due to a staggering lack of transparency from HHS”, the union hasn’t received formal notices about who is being laid off, the federation said in a statement on Wednesday.

The permanent cuts include about 100 people who worked in violence prevention. Some employees noted that those cuts came less than two weeks after a man fired at least 180 bullets into the CDC’s campus and killed a police officer.

“The irony is devastating: The very experts trained to understand, interrupt and prevent this kind of violence were among those whose jobs were eliminated,” some of the affected employees wrote in a blog post last week.

Churchill Asset Management led a roughly $190 million private credit deal to support Shamrock Capital Advisors’s purchase of communications and corporate strategy firm Penta Group, according to people with knowledge of the matter.

PennantPark Investment Corp. also participated in the deal, said the people, who asked not to be identified discussing private information.

UnitedHealth Group Inc. formed a new “public responsibility committee” within its board to enhance governance and oversight as the embattled health-care conglomerate tries to repair its standing with shareholders, regulators and the public.

The committee “will monitor and oversee financial, regulatory, and reputational risks,” the company said in a filing Wednesday. UnitedHealth also named a new lead independent director, the former Vanguard Group chief F. William McNabb, who has served on the board since 2018.