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Mastermind of ‘Varsity Blues’ college admissions scheme sentenced to more than 3 years in prison

William “Rick” Singer leaves the federal courthouse after facing charges in a nationwide college admissions cheating scheme in Boston, Massachusetts, U.S., March 12, 2019.

Bryan Snyder | Reuters

William Rick Singer, the mastermind of a nationwide college admissions cheating scheme, was sentenced to three and a half years in prison and supervised release Wednesday afternoon in Boston.

Singer, 62, pleaded guilty in March 2019 to charges including racketeering conspiracy and money laundering conspiracy in connection with the scandal, dubbed Operation Varsity Blues. He cooperated with the government’s investigation and wore a wire for the FBI.

In addition to 42 months served in prison, Singer will have three years of supervised release.

The operation involved bribes, cheating on entrance exams and unqualified applicants using bogus claims to get into schools as elite recruited athletes.

Prosecutors had sought a six-year sentence, while defense attorneys requested three years of probation or a maximum of six months behind bars. 

Singer’s sentence is the longest handed down in the case so far, followed by former Georgetown University tennis coach Gordon Ernst, who got 2 1/2 years in prison for pocketing more than $3 million in bribes.

So far, more than 50 people, including parents and coaches, have been convicted in the case. The cheating scheme ensnared Hollywood with actors Lori Loughlin and Felicity Huffman charged in the case.

Singer allegedly raked in more than $25 million from his clients, paid bribes totaling more than $7 million and used more than $15 million of his clients’ money for his own benefit, prosecutors said. 

In a letter filed Dec. 29 along with his defense’s sentencing memorandum, Singer said he now lives in a trailer park and can’t get a job, despite more than 1,000 attempts, because of his role in Operation Varsity Blues. 

“For most of my life, if not all of it, I have thrived on winning at all costs,” he wrote. “My moral compass was broken and, increasingly over time, choosing right over wrong became less important than doing whatever had to be done to be recognized as the ‘best.'”

By getting caught, he has been provided “the opportunity for insight, atonement, and redemption,” he wrote.

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JPMorgan's top picks for 2023, including two stocks coming off their worst performances in decades

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Raymond James sees clean energy stocks jumping 30% to 40% in 2023. Here are some favorite picks

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Fed officials see higher rates for 'some time' ahead

WASHINGTON – Federal Reserve officials are committed to fighting inflation and expect higher interest rates to remain in place until more progress is made, according to minutes released Wednesday from the central bank’s December meeting.

At a meeting where policymakers raised their key interest rate another half a percentage point, they expressed the importance of keeping restrictive policy in place while inflation holds unacceptably high.

“Participants generally observed that a restrictive policy stance would need to be maintained until the incoming data provided confidence that inflation was on a sustained downward path to 2 percent, which was likely to take some time,” the meeting summary stated. “In view of the persistent and unacceptably high level of inflation, several participants commented that historical experience cautioned against prematurely loosening monetary policy.”

The increase ended a streak of four consecutive three-quarter point rate hikes, while taking the target range for the benchmark fed funds rate to 4.25%-4.5%, its highest level in 15 years.

Officials also said they would focus on data as they move forward and see “the need to retain flexibility and optionality” regarding policy.

Officials further cautioned that the public shouldn’t read too much into the rate-setting Federal Open Market Committee’s move to step down the pace of increases.

“A number of participants emphasized that it would be important to clearly communicate that a slowing in the pace of rate increases was not an indication of any weakening of the Committee’s resolve to achieve its price-stability goal or a judgment that inflation was already on a persistent downward path,” the minutes said.

Following the meeting, Fed Chairman Jerome Powell indicated that while there has been some progress made in the battle against inflation, he saw only halting signs and expects rates to hold at higher levels even after the increases cease.

The minutes reflected those sentiments, noting that no FOMC members expect rate cuts in 2023, despite market pricing.

Markets currently are pricing in the likelihood of rate increases totaling 0.5-0.75 percentage point before pausing to evaluate the impact the hikes are having on the economy. Traders expect the central bank to approve a quarter-point increase at the next meeting, which concludes Feb. 1, according to CME Group data.

Current pricing also indicates the possibility of a small reduction in rates by the end of the year, with the funds rate landing around a range of 4.5%-4.75%. Fed officials, however, have expressed doubt repeatedly about any loosening of policy in 2023.

The minutes noted that officials are wrestling with two-pronged policy risks: One, that the Fed doesn’t keep rates high long enough and allows inflation to fester, similar to the experience in the 1970s; and two, that the Fed keeps restrictive policy in place too long and slows the economy too much, “potentially placing the largest burdens on the most vulnerable groups of the population.”

However, members said they see the risks more weighted to easing too soon and allowing inflation to run rampant.

“Participants generally indicated that upside risks to the inflation outlook remained a key factor shaping the outlook for policy,” the minutes said. “Participants generally observed that maintaining a restrictive policy stance for a sustained period until inflation is clearly on a path toward 2 percent is appropriate from a risk-management perspective.”

Along with the rate hikes, the Fed has been reducing the size of its balance sheet by allowing up to $95 billion in proceeds from maturing securities to roll off each month rather than be reinvested. In a program started in early June, the Fed has seen its balance sheet contract by $364 billion to $8.6 trillion.

While some of the recent inflation metrics have shown progress, the labor market, a critical target of the rate increases, has been resilient. Nonfarm payroll growth has exceeded expectations for most of the past year, and data earlier Wednesday showed that the number of job openings is still nearly twice the pool of available workers.

The Fed’s preferred inflation gauge, the personal consumption expenditures price index less food and energy, was at 4.7% annually in November, down from its 5.4% peak in February 2022 but still well above the Fed’s 2% target.

Economists, meanwhile, largely expect the U.S. to enter a recession in the coming months, the result of the Fed’s tightening and an economy dealing with inflation still running near 40-year highs. However, fourth-quarter GDP for 2022 is tracking at a solid 3.9% rate, easily the best of a year that started out with consecutive negative readings, according to the Atlanta Fed.

Minneapolis Fed President Neel Kashkari said Wednesday, in a post for the district’s website, that he sees the funds rate rising to 5.4% and possibly higher if inflation doesn’t trend down.

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Salesforce is cutting 10% of its personnel, more than 7,000 employees

Signage on a Saleforce office building in San Francisco, California, U.S., on Tuesday, Feb. 23, 2021.

David Paul Morris | Bloomberg | Getty Images

Salesforce is cutting 10% of its personnel and reducing some office space as part of a restructuring plan, the company announced Wednesday. The company employed more than 79,000 workers as of December.

In a letter to employees, co-CEO Marc Benioff said customers have been more “measured” in their purchasing decisions given the challenging macroeconomic environment, which led Salesforce to make the “very difficult decision” to lay off workers.

“I’ve been thinking a lot about how we came to this moment,” he said. “As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”

Salesforce will record charges of $1.0 billion to $1.4 billion related to the headcount reductions, and $450 million to $650 million related to the office space reductions, the company said.

Shares of Salesforce closed up more than 3% on Wednesday.

Jim Cramer: Investors are waiting for Silicon Valley to 'own up' and cut workforce

Analysts led by Brent Bracelin at Piper Sandler, who have the equivalent of a buy rating on Salesforce stock, estimated in a note to clients that the cuts could lower operating expenses by $1.5 billion or more each year and widen the company’s operating margin to 26% from 21%. That calculation assumes that “demand drivers remain intact,” which is unlikely, the analysts wrote.

The company is eager to become more profitable through more efficient spending. In September Salesforce management called for a 25% adjusted operating margin in the 2026 fiscal year, compared with 22.7% in the quarter that ended on Oct. 31.

The cuts mark the latest round of departures at the cloud-based software company, the largest private employer in San Francisco. The company let go of fewer than 1,000 employees in November. Later that month, Bret Taylor announced his plan to step down as co-CEO on Jan. 31, leaving Marc Benioff alone again at the top of the company he co-founded in 1999.

In the three trading days after the Taylor news landed alongside Salesforce’s third-quarter earnings report, the stock had two of its three worst days of 2022, plunging 8.3% and 7.4%, respectively. 

Days later, the company announced the departure of Slack CEO Stewart Butterfield, who joined Salesforce as part of its biggest acquisition ever.

Salesforce hired aggressively during the pandemic. It said in a December filing that headcount had risen 32% since October 2021 “to meet the higher demand for services from our customers.”

Now, like many other major tech companies, Salesforce is looking to cut costs as it contends with slowing revenue growth and a weakening economy. Days after Twitter’s new boss, Elon Musk, slashed half his company’s workforce, Facebook parent Meta announced its most significant round of layoffs ever, eliminating 13% of its staff. AmazonLyftHP and DoorDash also announced significant cuts to their workforces.

Salesforce said it expects its employee restructuring to be complete by the end of the 2024 fiscal year and real estate restructuring to finish in the 2026 fiscal year.

— CNBC’s Jordan Novet contributed to this report.

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Rivian stock hits new 52-week low after the automaker misses 2022 production target

Employees work on an assembly line at startup Rivian Automotive’s electric vehicle factory in Normal, Illinois, April 11, 2022.

Kamil Krzaczynski | Reuters

Shares of Rivian Automotive notched a new 52-week low on Wednesday after the company missed its 25,000-unit production target for last year.

The EV startup late Tuesday said it produced 24,337 vehicles in 2022, including 10,020 in the fourth quarter. Of those, 20,332 vehicles were delivered to customers during the year, including more than 8,000 from October through December.

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The missed target caps off a difficult year for the company as well as Rivian investors. Shares of the automaker declined by more than 80% during 2022 amid production, parts and supply chain problems.

Rivian said during its IPO roadshow in 2021 that it expected to build 50,000 vehicles in 2022. But it cut that guidance by half in March due to production and global supply chain issues.

Shares of Rivian during early trading Wednesday dipped by as much as 4.5% to $16.56 a share before reversing course and gaining more than 2% to close at $17.71 a share. A year ago the stock traded for $106.80 a share.

Shares of Rivian have fallen more than 80% in the last 12 months.

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Where to keep your cash amid high inflation and rising interest rates: It's 'a little tricky,' says expert

dowell | Moment | Getty Images

Investors have many options when saving for short-term goals, and those choices have become more complicated amid high inflation and rising interest rates.

While there have been signs of slowing inflation, the Federal Reserve is expecting higher interest rates to continue.

“It looks like this year might be a little tricky,” said Ken Tumin, founder and editor of DepositAccounts.com, a website that tracks the most competitive options for savings.  

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Although the Fed’s federal funds rate has reached the highest level in 15 years, savings account interest rates haven’t matched these hikes, Tumin explained. 

As of Jan. 4, online high-yield savings accounts were paying an average of 3.48%, according to DepositAccounts, with some smaller banks reaching 4%. 

Still, if you’re keeping money in a savings account, Tumin said it’s better to stick with established banks.

Key takeaways from the CNBC Workforce Survey

He cautioned savers to be “real careful” with financial technology companies partnering with banks for checking and savings accounts and other cash products. “You should go directly to FDIC-insured banks, rather than through fintechs,” Tumin said. 

It’s a ‘strange environment’ for certificates of deposit

Another option for savings, certificates of deposit, or CDs, may present opportunities for short-term savers, Tumin said. 

“It’s kind of a strange environment where we actually can get a higher rate for short-term CDs than long-term CDs,” he said.

It’s kind of a strange environment where we actually can get a higher rate for short-term CDs than long-term CDs.

Ken Tumin

Founder and editor of DepositAccounts.com

While Tumin expects savings account interest to rise, these rates may not match one-year CDs, which have more closely followed the Fed, and were offering an average of 4.81% as of Jan. 4, according to DepositAccounts.

“From that point of view, you might be better off with a one-year CD than an online savings account over the next year,” he said.

Series I bonds are still a ‘great consideration’ for short-term investors

As inflation has soared, Series I bonds, an inflation-protected and nearly risk-free asset, have also become a popular choice for short-term savings.

I bonds are currently paying 6.89% annual interest on new purchases through April, down from the 9.62% yearly rate offered from May through October 2022.

“These have become very popular among our clients as the rates have skyrocketed,” said certified financial planner Eric Roberge, founder of Beyond Your Hammock in Boston. “This makes them great considerations for shorter-term investors.”

I bonds earn monthly interest with two parts: a fixed rate, which may change every six months for new purchases but stays the same after buying, and a variable rate, which changes every six months based on inflation.

While the current 6.89% annual rate may be appealing, the yield may change in May, based on six months of inflation data. Since you can’t access the money for one year, there’s the potential to lock in a lower rate after the first six months. 

Still, if you need your money in one to five years, this could be a choice to consider, Roberge said.

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GM reclaims title as America's top automaker after a 2.5% jump in sales last year

2022 GMC Sierra 1500 Denali Ultimate

GM

DETROIT – General Motors reclaimed its U.S. sales crown from Toyota Motor last year as the Detroit automaker eked out a slight gain in annual U.S. vehicle sales despite supply chain problems.

GM said Wednesday it sold 2.27 million vehicles in the U.S. in 2022, up by 2.5% over 2021, including a 41.4% increase during the fourth quarter. Analysts expect overall U.S. auto industry sales to have declined by 7% and 10% last year compared to 2021.

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Toyota said it sold 2.1 million vehicles in the U.S. last year, down 9.6% from 2021. The company was able to manage supply chain problems, specifically with semiconductor chips, better than others.

Toyota edged out GM in sales by 114,034 vehicles in 2021 – dethroning the Detroit automaker for the first time since 1931 when it surpassed Ford Motor. Toyota executives previously said the top sales spot was unattainable, but CEO Akio Toyoda last year told dealers he did a “happy dance” when he heard the news.

Jack Hollis, executive vice president of Toyota Motor North America, on Wednesday said the Japanese automaker remains focused on retail sales, which are traditionally more profitable than commercial or fleet sales. Toyota has led those sales for several years.

EVs

Despite recent criticism of its all-electric vehicle strategy, Toyota on Wednesday touted that it leads the country in electrified vehicle sales. Those include hybrid, plug-in and all-electric cars and trucks.

GM, in contrast, largely ditched hybrids for an all-electric vehicle strategy but has been slow to ramp up production. GM’s U.S. EV sales represented less than 2% of its sales in 2022.

Comparison of GM and Toyota stocks.

In a release Wednesday, GM called EVs “growth opportunities.” It’s expected to release more mainstream models such as the Chevrolet Blazer and Chevrolet Equinox EV crossovers.

GM was able to achieve record U.S. sales of 38,120 Chevrolet Bolt EV and EUV models in 2022. However, it sold fewer than 1,000 units of its luxury GMC Hummer EV and Cadillac Lyriq, combined.

GM said production of the Bolt models is expected to increase to more than 70,000 units this year to meet strong global demand. The company last year pushed back plans to produce 400,000 EVs in North America through 2023 to mid-2024.

Pickups

While GM’s future may be EVs, its present is large, gas-guzzling pickup trucks and SUVs. The Detroit automaker sold more than 1.1 million mid-size pickups and full-size trucks, including SUVs, in 2022. Those sales represented nearly 50% of their total annual sales.

Such vehicles are highly profitable and crucial to GM’s bottom line as it invests in capital-intensive electric and autonomous vehicles.

GM has been the top seller of pickups for nine years, including topping crosstown rival Ford in full-size pickups for three consecutive years. However, Ford’s F-Series has been America’s bestselling truck for 46 consecutive years and bestselling vehicle for 41 years.

The accolades come despite declining sales of full-size pickups for both automakers due to supply chain issues. GM sold 754,876 Chevrolet Silverado and GMC Sierra pickups in 2022, down by roughly 2%. Sales of Ford’s F-Series were off by nearly 13% through November compared with a year earlier, however Ford said Tuesday that last month’s sales were anticipated to be the best of 2022 for the F-Series.

First impressions of the Ford F-150 Lightning

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Ukraine war live updates: Russia blames use of cellphones for deadly Makiivka attack; Putin sends new hypersonic cruise missiles to Atlantic

Serbian president rejects calls for sanctions against Russia

Serbia’s president said that the European Union’s calls for his country to join sanctions against Russia over the war in Ukraine represent “a brutal” interference in the internal affairs of the Balkan state, which has asked to join the EU.

In his wide-ranging year-end address to the nation, Aleksandar Vucic praised his and his country’s economic and political achievements, comparing himself to a wolf who cannot be tamed under international pressure.

“Thank you very much for meddling in our internal affairs in such a brutal way,” he said, referring to the Western appeals.

Although formally seeking EU membership, Serbia has repeatedly ignored calls to align its foreign policies with the 27-nation bloc, including joining international sanctions against Moscow over the war in Ukraine.

There are increasing suggestions from EU-member states that Serbia’s membership bid should be suspended until it complies with the bloc’s foreign policies.

— Associated Press

Biden says Bradley Fighting Vehicles are on the table for Ukraine

U.S. President Joe Biden speaks prior to signing railroad legislation into law, providing a resoluton to avert a nationwide rail shutdown, during a signing ceremony in the Roosevelt Room at the White House in Washington, U.S., December 2, 2022. 

Kevin Lamarque | Reuters

U.S. President Joe Biden said that sending Bradley Fighting Vehicles to Ukraine was being considered to help the Ukrainians in combating Russia’s invasion.

“Yes,” Biden said when asked if the option was on the table.

— Reuters

Claims that war pits Russia against NATO are ‘a bunch of BS,’ White House spokesman says

White House National Security Council Strategic Communications Coordinator John Kirby speaks during a press briefing at the White House in Washington, November 28, 2022.

Kevin Lamarque | Reuters

Russian claims that Moscow’s war in Ukraine is really a fight against NATO and Western countries are “a bunch of BS,” a Biden administration spokesman said.

“This is about a Russian invasion of Ukraine,” said U.S. National Security Council spokesman John Kirby. “And Russia is the one who started it. Russia is the one who’s visited violence on the Ukrainian people at a scale.”

Kirby added that the U.S. will “continue to provide [Ukraine] the kinds of systems and assistance they need to defend themselves,” including the coveted High Mobility Artillery Rocket System.

— Jacob Pramuk

Heavy fighting likely to persist in Ukrainian-held Bakhmut, U.S. official says

Ukrainian soldiers with the 43rd Heavy Artillery Brigade sit atop 2S7 Pion self propelled cannon on the battlefield, as Russia’s attack on Ukraine continues, during intense shelling on the front line in Bakhmut, Ukraine, December 26, 2022.

Clodagh Kilcoyne | Reuters

Heavy fighting around the largely ruined, Ukrainian-held city of Bakhmut is likely to persist for the foreseeable future, with the outcome uncertain as Russians have made incremental progress, according to a senior U.S. administration official.

— Reuters

Russian torture chambers uncovered in Kherson, Ukraine

Kherson police said local residents were held in cells and rooms for days, tortured with electricity and batons and forced to write Russian patriotic texts. Kherson was the only regional capital captured by Russia since the invasion, and Ukraine liberated it late last year.

KHERSON, UKRAINE – JANUARY 04: Officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the basements and rooms of Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine. According to the Kherson police, local residents were held in cells and rooms for days, tortured with electricity, batons and forced to write Russian patriotic texts. Kherson was the only regional capital captured by Russia since the invasion and it was liberated by Ukraine late last year. (Photo by Pierre Crom/Getty Images)

Pierre Crom | Getty Images

A burnt bed within a room as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the basements and rooms of Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine. 

Pierre Crom | Getty Images

A general view of the basement and rooms as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine. 

Pierre Crom | Getty Images

KHERSON, UKRAINE – JANUARY 04: Russian patriotic written letters as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the basements and rooms of Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine. According to the Kherson police, local residents were held in cells and rooms for days, tortured with electricity, batons and forced to write Russian patriotic texts. Kherson was the only regional capital captured by Russia since the invasion and it was liberated by Ukraine late last year. (Photo by Pierre Crom/Getty Images)

Pierre Crom | Getty Images

Walls are marked with the Russian war symbol Z as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the basements and rooms of Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine.

Pierre Crom | Getty Images

A general view of the basement and rooms as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine.

Pierre Crom | Getty Images News | Getty Images

A calendar marked on a wall in a cell as officers of the War Crimes Prosecutor office and police officers investigate war crimes committed by the Russian occupying forces on the local civilian population in the basements and rooms of Ukrainian penitentiary buildings on January 4, 2023 in Kherson, Ukraine.

Pierre Crom | Getty Images

— Pierre Crom | Getty Images

Zelenskyy and Macron discussed aid to boost Ukraine’s air defenses

Ukrainian President Volodymyr Zelenskyy shakes hands with French President Emmanuel Macron during a news briefing following their talks in Kyiv, Ukraine on February 8, 2022.

Gleb Garanich | Reuters

Ukrainian President Volodymyr Zelenskyy and French President Emmanuel Macron had a “long and detailed conversation” about efforts to boost Ukraine’s defenses against Russian attacks.

“We agreed on further cooperation to significantly strengthen our air defense and other defense capabilities,” Zelenskyy said in a post on his Telegram channel.

France and other European nations have funneled aid to Ukraine since Russia invaded its neighbor last year. Zelenskyy has pleaded for air defenses in particular as Russia pummels his country with missile strikes.

— Jacob Pramuk

Russia-appointed official says 5 people died in Ukrainian strike on occupied city

The Russian-appointed governor of the Zaporizhzhia region in Ukraine said a Ukrainian strike on the Russian-occupied city of Vasilyevka left five people dead and 15 injured, according to an NBC News translation.

— Jacob Pramuk

Czech government OKs bill for 2% GDP spending on military

The Czech government approved a bill aimed at bringing defense spending at the required NATO goal of 2% of gross domestic product as Russia’s war in Ukraine continues.

Defense Minister Jana Cernochova said the move would “ensure a stable and transparent financing of big defense strategic projects in the future.”

Cernochova said the war in Ukraine “made it clear we have to be ready for the current and future conflicts and that’s why a fast modernization of the army is absolutely necessary.”

Although the Czechs will spend only 1.52% of GDP on defense this year, the 2% target should be reached in 2024 once the bill is approved in parliament where the governing coalition has a majority in both chambers.

NATO members agreed in 2014 to commit to the 2% spending target by 2024. Currently, only nine of the Western military alliance’s 30 members meet or surpass that goal.

— Associated Press

Ukraine sees speeding up inspections as key to Black Sea grain deal

The Sierra Leone-flagged cargo ship Razoni, carrying Ukrainian grain, is seen in the Black Sea off Kilyos, near Istanbul, Turkey August 3, 2022.

Mehmet Caliskan | Reuters

Ukraine’s efforts to increase exports under the Black Sea grain deal with Russia are currently focused on securing faster inspections of ships rather than including more ports in the initiative, a senior Ukrainian official said.

Ukraine is a major global grain producer and exporter, but production and exports have fallen since Russia invaded the country last February and started blockading its seaports.

Three leading Ukrainian Black Sea ports in the Odesa region were unblocked in July under an initiative between Moscow and Kyiv brokered by the United Nations and Turkey. Under the deal, all ships are inspected by joint teams in the Bosphorus.

Kyiv accuses Russia of carrying out the inspections too slowly, causing weeks of delays for ships and reducing the supply of Ukrainian grain to foreign markets. Russia has denied slowing down the process.

— Reuters

Putin sends new hypersonic cruise missiles to Atlantic

Russian President Vladimir Putin and Defense Minister Sergei Shoigu attend a wreath-laying ceremony, which marks the anniversary of the beginning of the Great Patriotic War against Nazi Germany in 1941, at the Tomb of the Unknown Soldier by the Kremlin wall in Moscow, Russia June 22, 2022.

Mikhail Metzel | Sputnik | Reuters

Russian President Vladimir Putin on Wednesday sent off a frigate towards the Altantic and Indian oceans armed with new hypersonic Zircon cruise missiles which he said were unique in the world.

In a video conference with Defence Minister Sergei Shoigu and Igor Krokhmal, commander of the frigate named “Admiral of the Fleet of the Soviet Union Gorshkov,” Putin said the ship was armed with Zircon hypersonic weapons.

“This time the ship is equipped with the latest hypersonic missile system — ‘Zircon’ — which has no analogues,” said Putin, who is engaged in a standoff with the West over his war in Ukraine.

“I would like to wish the crew of the ship success in their service for the good of the Motherland.”

Shoigu said the Gorshkov would sail to the Atlantic and Indian oceans and to the Mediterranean Sea.

“This ship, armed with ‘Zircons’, is capable of delivering pinpoint and powerful strikes against the enemy at sea and on land,” Shoigu said.

Shoigu said the hypersonic missiles, known as either Tsirkon or Zircon, could overcome any missile defense system. The missiles fly at nine times the speed of sound and have a range of over 1,000km, Shoigu said.

Russia, China and the United States are currently in a hypersonic weapons race. Because of their speeds — above five times the speed of sound — and manoeuvrability, such weapons are seen as a way to gain an edge over any adversary.

The target of a hypersonic weapon is much more difficult to calculate than for intercontinential ballistic missiles.

— Reuters

Mariupol sea port being turned into military base, advisor claims

A cargo ship is loaded with grain at the Port of Mariupol in Ukraine.

Bloomberg | Bloomberg | Getty Images

The port of Mariupol is gradually being turned into a military base, an advisor to the occupied city’s mayor claimed.

“The occupiers are gradually turning it into a military base,” Petro Andriushchenko said on Telegram.

“At the end of December, all residents of Mariupol were released from the port (with the exception of certain specialists-collaborators) and workers were brought in from Moscow. Work has begun on the division of berths into conventionally civilian and conventionally military ones,” he said.

Andriushchenko said the port had seen isolated, irregular arrivals of ships carrying building materials and containers of unknown content. He also noted that some port workers had been moved to Crimea in December and that contact with them had then been lost and their whereabouts were unknown to relatives. CNBC was unable to verify the claims.

Mariupol was fully occupied by Russian forces last May following a prolonged siege with Ukrainian fighters holed up in the city’s Azovstal steelworks. Russia’s relentless bombardment of the city up to its capture left much of it in ruins.

— Holly Ellyatt

Russian army trying to advance through its own corpses in Bakhmut, army chief says

The head of Ukraine’s armed forces said fighting in the Luhansk and Donetsk areas around Bakhmut remains intense and difficult.

“Heavy fighting” is taking place between Svatove and Kreminna in Luhansk, as well as toward Lysychansk, the Commander-in-Chief of the Armed Forces of Ukraine Valeriy Zaluzhny said on Telegram Tuesday.

He said the most difficult situation remains in the area of Soledar, Bakhmut and Mayorsk, where “the Russian army is actually trying to move forward through its corpses, but units of the Defense Forces are holding back the advance,” Zaluzhny said on Telegram, according to a Google translation of his comments.

Emergency service workers extinguish a fire after shelling on the Bakhmut front line in Ivanivske, Ukraine on Jan. 2, 2023.

Anadolu Agency | Anadolu Agency | Getty Images

Bakhmut has been the epicenter of attritional warfare for several months, with Russian forces gaining little ground in their bid to capture the town, which analysts say has little overall strategic value for Russia.

Despite that, Russia continues to expend weaponry and manpower on its offensive operation in the pocket of Donetsk that is part of the wider Donbas region of eastern Ukraine, which Moscow says it wants to “liberate.”

Zaluzhny said Ukraine continued to hold positions around Avdiivka in the Donetsk region and was continuing counteroffensive actions. 

“We are reliably holding defensive lines in the Zaporozhzhia direction and are making efforts to protect Kherson from enemy shelling,” he said. The situation on the border with Russia’s ally Belarus is fully under control, he added.

— Holly Ellyatt

Infrastructure, apartments and kindergarten damaged in Zaporizhzhia attack, officials say

A missile attack on the city of Zaporizhzhia in southern Ukraine has targeted an infrastructure facility, destroying nearby warehouses and damaging apartment buildings, according to Ukrainian officials.

Kyrylo Tymoshenko, deputy head of the Office of the President of Ukraine, said on Telegram Wednesday that one person had been injured in the rocket attack on the city. He said Russian forces had used S-300 missiles, according to a Google translation of his comments. Tymoshenko’s post contained images and video footage purportedly showing the destruction following the attack.

An Ukrainian soldier returns to the front line after taking a rest in an underground shelter in the Zaporizhzhia region of Ukraine.

Nurphoto | Nurphoto | Getty Images

Anatoliy Kurtev, the acting mayor of Zaporizhzhia, urged residents of the city to take shelter, saying on Telegram earlier today that Russian forces were “on the defensive” in the Zaporizhzhia area. He said eight high-rise buildings had been damaged during the attack.

“According to preliminary information, 8 high-rise buildings were damaged in one of the districts of the city … Their windows were blown out and their balconies were destroyed. In addition, the kindergarten building was damaged. There, too, the windows were broken and the roof was partially damaged,” he said on Telegram.

Further information about the attack is still being established, the officials said. CNBC was unable to immediately verify the reports.

— Holly Ellyatt

Ammunition likely being stored near Makiivka troop accommodation, UK says

Britain’s Ministry of Defense said on Wednesday it’s likely that ammunition is being stored near a Russian military complex that was destroyed in a Ukrainian attack on New Year’s Eve, highlighting unsafe and unprofessional practices by the Russian army.

Russian emergency workers remove the rubble of vocational school 19 destroyed by shelling in Makeevka, Donetsk People’s Republic, Russia. The armed forces of Ukraine attacked the vocational school building in Makeyevka of the Donetsk People’s Republic from the HIMARS MLRS on December 31 to January 1.

RIA Novosti | Sputnik via AP

Russia’s Defense Ministry said 89 Russian servicemen had died in the attack on the building that was being used as a college and temporary accommodation for newly conscripted soldiers. It’s a rare admission of multiple losses by Russia, which blamed the attack on personnel using mobile phones, saying this had enabled Ukraine to target the location.

Britain’s Ministry of Defense remarked on Twitter that Ukraine had completely destroyed a school building in Makiivka in Donetsk “which Russia had almost certainly taken over for military use.”

“Given the extent of the damage, there is a realistic possibility that ammunition was being stored near to troop accommodation, which detonated during the strike creating secondary explosions.”

It noted that the building was only 7.7 miles from the Avdiivka section of front line, “one of the most intensely contested areas of the conflict.”

“The Russian military has a record of unsafe ammunition storage from well before the current war, but this incident highlights how unprofessional practices contribute to Russia’s high casualty rate,” U.K.’s defense ministry added.

— Holly Ellyatt

Russia ready to ‘throw everything they have left’ at the war, Zelenskyy says

President of Ukraine Volodymyr Zelenskyy visits the Kharkiv region for the first time since Russia started attacks against his country, on May 29, 2022.

Ukrainian Presidency | Anadolu Agency | Getty Images

Ukraine’s President Volodymyr Zelenskyy said Tuesday night that Kyiv is prepared for renewed offensives and mobilization by Russia.

Zelenskyy said on Telegram that he had spoken with his counterparts in Canada, the Netherlands, U.K. and Norway on Tuesday, with the conversation focusing on “what Ukraine immediately needs most right now — on the eve of those new mobilization processes being prepared by the terrorist state.”

A burned civilian vehicle allegedly shot by Russian occupying forces on Jan. 3, 2023 in Oleksandrivka, Ukraine.

Pierre Crom | Getty Images News | Getty Images

“Right now is the moment when, together with our partners, we should strengthen our defense. We have no doubt that the present masters of Russia will throw everything they have left, and all they can muster, into trying to turn the tide of the war, and at least delay their defeat. We have to disrupt this Russian scenario. We are preparing for it,” Zelenskyy said, adding that “any attempt at their new offensive must fail.”

— Holly Ellyatt

Russia blames use of mobile phones for deadly Makiivka attack

Russia has been left reeling as the death toll rises following a Ukrainian strike on newly conscripted soldiers in Makiivka, a town in the partially Russian-occupied eastern Donetsk region in east Ukraine.

Russia’s Defense Ministry said Tuesday night that the death toll from the attack, which took place on New Year’s Eve, had risen to 89, according to reports by Russian state news agencies.

It had previously said 63 soldiers had died in the attack, which struck a college for conscripts in Makiivka, in a rare admission of multiple losses.

It blamed the unauthorized use of cellphones for the strike, saying their use had allowed Ukraine to locate and strike its personnel.

“This factor allowed the enemy to locate and determine the coordinates of the location of military personnel for a missile strike,” the ministry said in a statement, reported by RIA Novosti.

Mourners gather to lay flowers in memory of Russian soldiers who were killed in a Ukrainian strike on a college for newly conscripted Russian soldiers in the occupied city of Makiivka in eastern Ukraine on New Year’s Eve.

Arden Arkman | Afp | Getty Images

The ministry said Ukraine had struck the building in Makiivka using missiles from a HIMARS rocket system and claimed that Russian forces had intercepted four of six rockets. It claimed it had destroyed the HIMARS rocket system from which the attack was carried out. CNBC was unable to verify the defense ministry’s claims.

The attack has caused consternation in Russia, with mourners gathering in Samara, the region where the majority of the mobilized soldiers reportedly came from.

— Holly Ellyatt

Moscow’s invasion is likely to inflict long-term economic decline on Russia

Ukraine war: Moscow's invasion likely to inflict long-term economic decline on Russia

Moscow thought it would emerge from the Ukraine invasion with a bigger role on the global stage. But it’s growing more isolated and looks likely to face a long-term economic decline. CNBC’s Ted Kemp reports.

Russians angry at commanders over Ukrainian strike that killed scores

Soldiers of the 59th brigade of the Ukrainian Armed Forces fire grad missiles on Russian positions in Russia-occupied Donbas region on December 30, 2022 in Donetsk, Ukraine. Russia has tried to expand its control there since it invaded Ukraine.

Pierre Crom | Getty Images News | Getty Images

Russian nationalists and some lawmakers have demanded punishment for commanders they accused of ignoring dangers as anger grew over the killing of dozens of Russian soldiers in one of the deadliest strikes of the Ukraine conflict.

In a rare disclosure, Russia’s defense ministry said 63 soldiers were killed in the Ukrainian strike on New Year’s Eve that destroyed a temporary barracks in a vocational college in Makiivka, twin city of the Russian-occupied regional capital of Donetsk in eastern Ukraine.

Russian critics said the soldiers were being housed alongside an ammunition dump at the site, which the Russian defense ministry said was hit by four rockets fired from U.S.-made HIMARS launchers.

TV footage showed a huge building reduced to rubble as cranes and bulldozers picked through concrete debris lying several feet deep.

Ukraine and some Russian nationalist bloggers put the Makiivka death toll in the hundreds, though pro-Russian officials say those estimates are exaggerated.

Rallies to commemorate the dead were held in several Russian cities, including Samara, where some came from, RIA Novosti news agency reported. Mourners laid flowers in the center of Samara.

“I haven’t slept for three days, Samara hasn’t slept. We are constantly in touch with the wives of our guys. It’s very hard and scary. But we can’t be broken. Grief unites … We will not forgive, and, definitely, victory will be ours,” RIA quoted Yekaterina Kolotovkina, a representative of a women’s council at an army unit, as telling one of the rallies.

— Reuters

Russia, shaken by Ukrainian strike, could step up drone use

Russian emergency workers remove the rubble of vocational school 19 destroyed by shelling in Makeevka, Donetsk People’s Republic, Russia. The armed forces of Ukraine attacked the vocational school building in Makeyevka of the Donetsk People’s Republic from the HIMARS MLRS on December 31 to January 1.

Sputnik via AP

Emergency crews sifted through the rubble of a building struck by Ukrainian rockets, killing at least 63 Russian soldiers barracked there, in the latest blow to the Kremlin’s war strategy as Ukraine says Moscow’s tactics could be shifting.

An Associated Press video of the scene in Makiivka, a town in the partially Russian-occupied eastern Donetsk region, showed five cranes and emergency workers removing big chunks of concrete under a clear blue sky.

In the attack, which apparently happened last weekend, Ukrainian forces fired rockets from a U.S.-provided HIMARS multiple launch system, according to a Russian Defense Ministry statement.

It was one of the deadliest attacks on the Kremlin’s forces since the war began more than 10 months ago and an embarrassment that stirred renewed criticism inside Russia of the way the war is being conducted.

The Russian statement Monday about the attack provided few other details. Other, unconfirmed reports put the death toll much higher.

The Strategic Communications Directorate of Ukraine’s armed forces claimed Sunday that around 400 mobilized Russian soldiers were killed in a vocational school building in Makiivka and about 300 more were wounded. That claim couldn’t be independently verified. The Russian statement said the strike occurred “in the area of Makiivka” and didn’t mention the vocational school.

— Reuters

Russia aims to ‘exhaust’ Ukraine with continued attacks, Zelenskyy says

“The morning is difficult. We are dealing with terrorists. Dozens of missiles, Iranian ‘Shahids’,” Zelenskyy wrote on his Telegram official account, referencing the Iranian-made Shahid drones increasingly used by Russian forces.

Ukrinform | Future Publishing | Getty Images

Russia aims to “exhaust” Ukraine with a prolonged stream of attacks across the country, Ukrainian President Volodymyr Zelenskyy said in his nightly address.

“We must ensure – and we will do everything for this – that this goal of terrorists fails like all the others,” he said. “Now is the time when everyone involved in the protection of the sky should be especially attentive.”

Russian strikes on Ukrainian cities and infrastructure have ramped up of late, marking three consecutive nights of bombardment in the latest stream of attacks that began on New Year’s Eve. The strikes target Ukraine’s energy facilities in particular, leaving millions of people without heating and power amid the bitter winter cold.

Russian forces are increasingly leaning on deadly Iranian-made Shahed drones, which have wrought havoc on Ukraine’s cities. Zelenskyy said that Ukrainian air defenses shot down more than 80 of such drones in the first days of January.

— Natasha Turak

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