Trump Trade: FTC opens inquiry into AI chatbots

Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Donald Trump with this daily recap compiled by The Fly:

AI CHATBOTS INQUIRY: The Federal Trade Commission is issuing orders to seven companies that provide consumer-facing AI-powered chatbots seeking information on how these firms measure, test, and monitor potentially negative impacts of this technology on children and teens. The FTC inquiry seeks to understand what steps, if any, companies have taken to evaluate the safety of their chatbots when acting as companions, to limit the products’ use by and potential negative effects on children and teens, and to apprise users and parents of the risks associated with the products. “Protecting kids online is a top priority for the Trump-Vance FTC, and so is fostering innovation in critical sectors of our economy,” said FTC Chairman Andrew N. Ferguson. The FTC’s order targets Alphabet (GOOGL), Instagram, Meta Platform (META), OpenAI, Snap (SNAP), xAI, and Character Technologies. The FTC is interested in particular on the impact of these chatbots on children and what actions companies are taking to mitigate potential negative impacts, limit or restrict children’s or teens’ use of these platforms, or comply with the Children’s Online Privacy Protection Act Rule.

AD PROBE: Additionally, Josh Sisco and Leah Nylen of Bloomberg reported, citing people familiar with the matter, that the Federal Trade Commission is investigating Amazon.com (AMZN) and Alphabet’s Google to see if the companies misled advertisers that place ads on their websites. The probes are being conducted by the FTC’s consumer protection unit and focus on whether the companies properly disclosed the terms and pricing for ads, sources told Bloomberg.

FED RESERVE BOARD: Lawyers for President Donald Trump on Thursday asked a federal appeals court to let his bid to fire Federal Reserve Board Governor Lisa Cook take effect before the central bank’s rate-setting committee meets next week, CNBC’s Kevin Breuninger reports. The request to the U.S. Court of Appeals for the District of Columbia Circuit came two days after a lower-court judge blocked Trump from removing Cook from her post while her lawsuit proceeds, the author notes. The Federal Open Market Committee, which includes Cook, is set to convene Tuesday for a two-day policy meeting where members will decide whether to cut a benchmark interest rate.

REGULATORY HURDLES: A merger between Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD) would face regulatory scrutiny, financial, operational, and investor hurdles, as well as possible interference from President Donald Trump, Bloomberg’s Hannah Miller reports. The deal would also lead to thousands of job firings through consolidation of businesses like their competing streaming services, Paramount+ and HBO Max, Miller writes. Warner said late last year it planned to restructure into two operating divisions, one focused on the legacy cable TV business and the other on streaming and studios, but the offer will be for the entire company, including its cable networks and movie studio, The Wall Street Journal previously said.