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Trump SPAC shares DWAC soar on social media deal news

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Trading in the stock of SPAC company Digital World Acquisition Corp. was halted Thursday because of volatility after its price skyrocketed on extremely heavy trading volume after news of a merger that would launch former President Donald Trump‘s planned social media platform.

DWAC’s stock was up by more than 130% before trading was halted for a second time. The stock surged by as much as 160% to $26.80 at one point.

Digital World Acquisition was the single most actively traded stock on the Fidelity platform Thursday, and was by far the most traded stock on the consolidated tape of New York Stock Exchange and Nasdaq listings.

Buy orders for DWAC — a so-called special purpose acquisition company set up to raise capital in the public markets to purchase private firms — outnumbered sell orders by nearly three-to-one on Fidelity’s platform.

By midday trading, more than 260 million shares of DWAC had already changed hands, according to FactSet.

In comparison, SPY, the exchange-traded fund that tracks the S&P 500, only had traded about 17 million shares around the same time.

In a press release Wednesday night, Trump’s new company Trump Media & Technology Group said it and DWAC “have entered into a definitive merger agreement, providing for a business combination that will result in Trump Media & Technology Group becoming a publicly listed company, subject to regulatory and stockholder approval.”

Trump also said he would roll out the platform called “TRUTH Social,” which he claimed will “stand up to the tyranny of Big Tech.”

Trump has been banned by the social media giants Twitter and Facebook since early this year after he was accused of inciting the Jan. 6 Capitol riot by a mob of his supporters.

Before the ban, Trump had been a compulsive user of Twitter, often sending out multiple tweets per day during his presidency. Since the ban, Trump has struggled to get his off-the-cuff brickbats against political foes heard in mass media.

In the press release Wednesday night, the ex-president’s new company said its “mission is to create a rival to the liberal media consortium and fight back against the “Big Tech” companies of Silicon Valley, which have used their unilateral power to silence opposing voices in America.”

Digital World Acquisition was incorporated in late 2020, shortly after Trump lost a re-election bid against President Joe Biden.

The ticker DWAC was among the top 10 most popular names on Reddit’s WallStreetBets chatroom Thursday, even exceeding meme stock GameStop’s mentions, according to alternative research provider Quiver Quantitative.

That could be a sign that retail investors active on social media platforms were fueling the rally in the SPAC.

The Securities and Exchange Commission did not immediately respond to a request for comment.

The planned merger values Trump Media & Technology Group “at an initial enterprise value of $875 Million, with a potential additional earnout of $825 Million in additional shares (at the valuation they are granted) for a cumulative valuation of up to $1.7 Billion depending on the performance of the stock price post-business combination,” the press release Wednesday said.

“Trump Media & Technology Group’s growth plans initially will be funded by DWAC’s cash in trust of $293 Million (assuming no redemptions),” according to the release.

A corporate overview of Trump’s new company does not list any officers, employees, or operations.

Instead, the 22-page slide show contains several graphics showing how many followers Trump had on Twitter before he was banned, and suggestions that the new venture will compete with both Disney+ and Netflix.

Patrick Orlando, CEO of DWAC, in the press release said, “Digital World was formed to create public shareholder value and we believe that TMTG is one of the most promising business combination partners to fulfill that purpose.”

“Given the total addressable market and President Trump’s large following, we believe the TMTG opportunity has the potential to create significant shareholder value,” Orlando said.

The release also said that “TMTG intends to launch a subscription video on demand service” called TMTG+.

“TMTG+ will feature ‘non-woke’ entertainment programming, news, podcasts, and more,” the release said.

Orlando, who graduated from MIT, spent five years at Deutsche Bank, where he worked with emerging markets fixed income derivatives. 

Orlando later moved into the South American sugar industry and is currently involved with at least three other SPACs, or so-called blank check companies: Yunhong International, Benessere Capital Acquisition, and Maquia Capital Acquisition.

Orlando is CEO of Yunhong International, which was incorporated in the Cayman Islands in 2020 and which lists its headquarters in Wuhan, China. 

The city of Wuhan is also the origin point of the coronavirus, which causes Covid-19, the pandemic disease which has ravaged the world for the past two years.

Both as president and since then, Trump referred to Covid as “The Wuhan virus,” and insisted that the pathogen was deliberately released from a Wuhan virology lab.

He has also demanded that China pay reparations to the world for the damage wrought by the virus.

In May, Yuhong International announced it had reached a deal to take a Chinese green energy company, Giga Energy, public. But that deal fell apart, and Giga Energy terminated its agreement with Yuhong last month.

The chief financial officer of Digital World Acquisition is Luis Orleans-Braganza, a member of Brazil’s parliament and a supporter of the far-right president, Jair Bolsonaro.

Orleans-Braganza is also a member of Brazil’s defunct royal family, which has not been in power since the country became a republic in the late 19th century.

But members of the family still pretend to be royalty. Orleans-Braganza himself has proposed an amendment to Brazil’s constitution that would create a fourth branch of government, a move that many observers see as an attempt to begin reinstalling a monarchy in Brazil.

– Additional reporting by CNBC’s Thomas Franck

This is breaking news. Please check back for updates.

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Wildfires broke emissions records this year in U.S., Turkey

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A Cal Fire firefighter from the Lassen-Modoc Unit watches as an air tanker makes a fire retardant drop on the Dixie Fire as trees burn on a hillside on August 18, 2021 near Janesville, California.

Patrick T. Fallon | AFP | Getty Images

Wildfires worsened by climate change produced a record amount of carbon emissions in parts of Siberia, the U.S. and Turkey this year, scientists with the Copernicus Atmosphere Monitoring Service said on Monday.

Intense and prolonged blazes emitted an estimated total of 1.76 billion tons of carbon — the equivalent of more than a quarter of U.S. annual carbon emissions.

The Sakha Republic in northeastern Siberia, Turkey, and the western U.S. recorded their highest wildfire emissions in 2021, according to Copernicus. Wildfires also devastated Albania, Algeria, Greece, Italy, North Macedonia, Spain and Tunisia.

“As the year draws to a close, we have seen extensive regions experience intense and prolonged wildfire activity, some of which has been at an level not observed in the last couple of decades,” said senior Copernicus scientist Mark Parrington.

Human-caused climate change has fueled hotter temperatures and drier conditions across the world, which have contributed to longer and more intense wildfire seasons. 2020 was one of the hottest years on record, and 2021 is virtually certain to be among the 10 hottest years ever recorded.

In July, the Dixie fire started in Northern California and burned for more than three months. It became the second-largest wildfire in the state’s history. Fires in California, Canada and the U.S. Pacific Northwest this year emitted about 83 million tons of carbon, and plumes of smoke from those blazes traveled across the Atlantic Ocean and reached large swaths of Europe.

Many countries around the eastern and central Mediterranean also suffered several days of intense wildfires over the summer that led to high concentrations of fine particulate matter and degraded air quality. In July, fires in Turkey prompted widespread evacuations and killed thousands of animals.

“Drier and hotter regional conditions caused by global warming increase the risk of flammability and fire risk of vegetation and this has been reflected in the extremely large, fast-developing and persistent fires we have been monitoring,” Parrington said. “It is clear from 2021 that climate change is providing the ideal environments for wildfires.”

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Boeing, travel stocks surge as investors shrug off omicron concerns

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An American Airlines passenger jet approaches to land at LAX during the outbreak of the coronavirus disease (COVID-19) in Los Angeles, California, April 7, 2021.

Mike Blake | Reuters

Boeing, airlines and other travel stocks surged on Monday after health experts shared early signs that the omicron variant of Covid may be causing milder symptoms than previous strains.

The travel sector was hard-hit by the emergence of omicron variant, which Botswana and South Africa first reported late last month. Cases were quickly detected in countries around the world, sparking renewed travel restrictions and outright bans, shortly after rules for international trips were loosened.

Dr. Anthony Fauci, the White House’s chief medical advisor told CNN on Sunday that “although it’s too early to make any definitive statements about it, thus far it does not look like there’s a great degree of severity to it.” A report from the South African Medical Research Council, released Saturday, suggested that the strain could cause a milder infection.

Shares of Boeing were up more than 3% in afternoon trading on Monday, while American Airlines and United Airlines were each up more than 10%, among the highest gainers in the S&P 500, topped by Norwegian Cruise Line and Royal Caribbean were up 12% and 11%, respectively. Online travel agency Expedia was trading more tan 8% higher.

Officials from the World Health Organization on Friday, however, warned against reading too much into data gleaned from the original cases in South Africa, saying it’s still too early to understand the severity of disease caused by omicron. Early reports of mild symptoms in some of the first cases where it was identified were based on a cluster of university students who tend to be younger and experience more mild symptoms than older adults, she said. Americans and Europeans also tend to be older and less healthy than the general population in South Africa, they noted.

“There was initial reports that it tended to be more mild, but it’s really too soon,” Maria Van Kerkhove, WHO’s technical lead on Covid-19, said in a Q&A streamed on the group’s social media channels. “Everybody who is infected with SARS-CoV-2 regardless of what variant will always start out with a mild disease. And so maybe it will stop there with mild, some people are asymptomatic of course, but it may stop with mild disease or it may take some time.”

Air travel jumped over the Thanksgiving holiday week, handing airlines some of their busiest days since the pandemic began, though still shy of 2019 levels. Omicron sent shares spiraling on concerns about a slump in demand.

Large network carriers are particularly dependent on longer-haul international trips, which have been slower to return in the pandemic compared with U.S. domestic travel.

-CNBC’s Holly Ellyatt contributed to this report.

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Biden to warn Putin against Russian invasion of Ukraine

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This combination of pictures created on December 06, 2021 shows US President Joe Biden during a signing ceremony at the White House in Washington, DC on November 18, 2021 and Russian President Vladimir Putin in a congress of the United Russia party in Moscow, on December 4, 2021.

Getty Images

WASHINGTON – President Joe Biden will warn Russian leader Vladimir Putin that the U.S. is prepared to impose severe economic countermeasures if Moscow carries out an attack on Ukraine, a senior administration official told reporters Monday.

The video call, which is set for Tuesday, will happen against a backdrop of amped-up tensions triggered in part by an alarming deployment of Russian troops and defense equipment along the country’s border with Ukraine.

“These movements are consistent with the planning that we see underway for a military escalation in Ukraine,” said the official, who declined to be named in order to discuss details of the upcoming call between Biden and Putin.

“We have had intensive discussions with our European partners about what we would do collectively in the event of a major Russian military escalation in Ukraine,” the official said. “We believe that we have a path forward that would involve substantial economic countermeasures by both Europe and the United States that would impose significant and severe economic harm on the Russian economy, should they choose to proceed.”

The administration official declined to say whether the U.S. would take direct military action against Russia if there were an invasion.

In recent weeks, Ukraine has warned Washington and European allies that Russian troops have amassed along its eastern border, a development that mimics Moscow’s 2014 invasion of Crimea. The annexation of Crimea sparked international uproar and triggered a series of sanctions on Moscow. Shortly after the invasion, a war broke out in eastern Ukraine between government forces and Russian-backed separatists.

An unclassified U.S. intelligence document obtained by Reuters shows Russian military activity on the territory of Russia and Russian-annexed Crimea close to the border with Ukraine.

Reuters

“To be clear, we do not know whether President Putin has made a decision about further military escalation in Ukraine. But we do know that he is putting in place the capacity to engage in such escalation should he decide to do so,” the senior Biden administration official said.

“We’ve seen this Russian playbook before in 2014, when Russia last invaded Ukraine,” the official added.

Meanwhile, the Kremlin has dismissed suggestions that Moscow was preparing for an attack on Ukraine and defended its right to deploy troops on its own territory.

Ukraine has previously pointed to Russian aggression as justification to accelerate its membership bid to join the North Atlantic Treaty Organization, the world’s most powerful military alliance. Ukraine announced in 2002 that it would seek to join NATO. Moscow has called Ukraine’s ambition to join the alliance a “red line.”

Earlier on Monday, Kremlin spokesperson Dmitry Peskov described the state of U.S. and Russian relations as “lamentable” and reiterated Moscow’s opposition to NATO’s expansion.

“The tense situation around Ukraine and NATO close-up to our borders will be discussed. And President Putin’s initiative on long-term guarantees of Russia’s security. All of these topics will be discussed,” Peskov said at a news conference previewing the call.

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“Of course, the bilateral relations will be discussed which are still in a lamentable state,” he added.

Last week, NATO Secretary General Jens Stoltenberg called on Moscow to deescalate tensions and reiterated that the alliance’s commitment to Ukraine’s sovereignty and territorial integrity “remains unwavering.”

“Ukraine is a sovereign, independent nation. And every sovereign, independent nation has the right to choose its own path, including what kind of security arrangements it wants to be part of. So it is up to Ukraine and 30 allies to decide when Ukraine is ready to join the alliance,” Stoltenberg said during a NATO meeting in Riga, Latvia.

“[Russia] has no veto, no right to interfere in that process,” Stoltenberg said.

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