3. TikTok sues Montana
In what’s sure to be a preview of cases to come, TikTok sued Montana to overturn the state’s ban on the app. Last week, Montana became the first state to ban TikTok, saying it posed a security risk due to its parent company, ByteDance, being Chinese-owned. “Yet the State cites nothing to support these allegations,” lawyers for ByteDance wrote. The lawyers argue that Montana’s law is unconstitutional, saying it violates the First Amendment’s freedom of speech while also preempting federal law. TikTok is facing heat from politicians on both sides of the aisle, in Washington and at the state level, as the popular app’s owners try to distance it from perceptions it’s controlled by the Chinese government. The Montana ban goes into effect Jan. 1.
4. Lowe’s cuts guidance
Home improvement chain Lowe’s lowered its revenue outlook for the year, as lumber prices have fallen and customers pared back spending on do-it-yourself projects. As we’ve seen from retail earnings so far, shoppers are spending less on things they don’t need while focusing more on necessities. Last week, Lowe’s rival Home Depot said its shoppers were spending less on renovation projects. Spring is typically the big season for hardware and home improvement stores, but it doesn’t appear that way this year. Lowe’s same-store sales for the period ended May 5 fell more than Wall Street expected, and the company lowered its same-store-sales expectations for the year.
5. Dimon on commercial real estate
The CEO of the largest bank in America sees more trouble ahead for the financial system, thanks to commercial real estate. “There’s always an off-sides,” JPMorgan Chase CEO Jamie Dimon said during the company’s investor conference Monday. “The off-sides in this case will probably be real estate. It’ll be certain locations, certain office properties, certain construction loans. It could be very isolated; it won’t be every bank.” Dimon joins a growing chorus of business leaders and experts who say commercial real estate could be the next big problem for the financial industry after the recent regional bank crisis. Earlier this month, Warren Buffett and Charlie Munger said commercial real estate is starting to see consequences from too many people borrowing at low rates.
— CNBC’s Mike Calia wrote this newsletter. Alex Harring, Christina Wilkie, Melissa Repko, Jonathan Vanian and Hugh Son contributed.
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