Business Highlights: Inflation drives retail spending bump
Jul 15, 2022, 3:18 PM | Updated: 3:52 pm
____
Retail sales up 1% in June, easing fears of a recession
NEW YORK (AP) — Consumers picked up their spending from May to June, underscoring their resilience despite painfully higher prices at the gas pump and in grocery aisles and allaying fears that the economy might be on the verge of a recession. U.S. retail sales rose 1% in June, from a decline of 0.1 % in May. The figures aren’t adjusted for inflation and so largely reflect higher prices, particularly for gas. But they also show that consumers are still providing crucial support for the economy. At the same time, the spending gain is modest enough that it likely won’t encourage the Federal Reserve to raise interest rates even more aggressively. Stocks rose after the report’s release.
____
Fired Southwest flight attendant wins $5.1 million verdict
DALLAS (AP) — A former Southwest Airlines flight attendant has won a $5.1 million verdict against the airline and the union for its flight attendants. Charlene Carter alleged that Southwest unlawfully fired her in 2017 at the union’s urging over anti-abortion messages she sent to the union president. A jury in federal district court in Dallas issued the verdict Thursday. Carter was unhappy over what she considered the union’s support for flight attendants who attended a protest march against President Donald Trump in Washington. Southwest believed her posts, in which she could be identified as a company employee, were offensive, and the private messages to the union president amounted to harassment.
___
Biden intervenes in railroad contract fight to block strike
OMAHA, Neb. (AP) — President Joe Biden has blocked a freight railroad strike that would disrupt shipments of all kinds of goods for at least 60 days by naming a board of arbitrators to intervene in the contract dispute. The move announced Friday will keep 115,000 rail workers on the job while the arbitrators develop a set of contract recommendations for both sides to consider. A new round of negotiations is expected after those recommendations are issued. If the railroads and their 12 unions can’t agree on a contract within the next 60 days, Congress would likely step in to prevent a strike by voting to impose terms or taking other action.
___
5-letter word for fun? Hasbro, NYT create Wordle board game
The company that makes some of the world’s most iconic board games including Scrabble, Monopoly, and Clue is developing a new one based on Wordle, the obsessively popular digital word-guessing game. Hasbro Inc. and Wordle owner The New York Times announced Thursday that Wordle: The Party Game will be available for purchase in North America in October. In the free online version, players get six tries to guess a five-letter word. The drawback is that it can only be played once per day. The board game will give players the opportunity to play against others, and play as much as they want.
___
Some schools build affordable housing to retain teachers
DALY CITY, Calif. (AP) — A San Francisco Bay Area school district built subsidized housing for teachers and staff who could not afford market rent. More districts in California and the U.S. are exploring the idea as rent and home prices grow out of reach. In West Virginia, the American Federation of Teachers helped build a housing complex with apartments for teachers and retail shops. But such projects face obstacles, including pushback from residents. The Jefferson Union High School District in California’s San Mateo County wants to develop more apartments, but a community garden stands in the way. Skeptics question whether schools should even get into housing development.
____
Wells Fargo profit falls as higher rates stymie homebuyers
Wells Fargo, the nation’s largest mortgage lender, saw its second-quarter revenue and profit decline as rising interest rates pushed people out of the housing market. The San Francisco bank earned $3.1 billion in the period, or 74 cents per share, coming up short of the 80 cents per share analysts expected. Revenue was $17 billion, also below Wall Street projections. Wells’ revenue from its home lending division fell by 53% in the period as the housing market cooled in the face of rapidly rising interest rates. Those higher rates did allow Wells to charge customers more for other loans. Shares rose more than 4%.
____
Growing enrollment, Optum Health propel UnitedHealth in 2Q
UnitedHealth Group hiked its 2022 forecast Friday after riding both growing health insurance enrollment and its newer care-providing businesses to a better-than-expected second quarter. The health care giant said a nearly 9% surge in Medicare Advantage customers pushed its total enrollment past 51 million people. UnitedHealth Group runs UnitedHealthcare, one of the nation’s largest insurers. But it also has been investing for several years now in its Optum segment, which provides care, manages prescription plans and offers technology support. Revenue from that segment grew 18% to about $45.1 billion in the quarter
____
Ukrainian rescuers hunt for survivors of Vinnytsia airstrike
VINNYTSIA, Ukraine (AP) — Rescue teams with sniffer dogs are combing through the debris in a central Ukrainian city looking for people still missing after Russia’s devastating missile strike that killed at least 23 and wounded over 100 others. Russian forces pounded other sites in Ukraine in a relentless push to wrest territory from Ukraine and try to soften the unbending morale of its leaders, troops and civilians. The cruise missile strikes on the city of Vinnytsia launched by a Russian submarine on Thursday marked the latest carnage to fan international outrage since Russia President Vladimir Putin launched the military invasion of Ukraine in February. Meanwhile, Russia said some progress was being made on a plan to get blocked Ukrainian grain to the world.
____
Italy enters into political uncertainty after 5-Stars balk
ROME (AP) — Italy is entering five days of political and financial uncertainty after the 5-Star Movement sparked a government crisis by withholding support on a government-sponsored bill. On the immediate horizon are behind-the-scenes consultations to see if Italian Premier Mario Draghi could be persuaded to try to find a new majority or should make preparations for an early election as soon as September. Analysts said Italy’s president was wise to try to keep Draghi in power, since the former European Central Bank chief is seen as a pillar of fiscal stability. One lawmaker blasted the 5-Star Movement, saying they are making the Kremlin happy to see Draghi weakened. Draghi has backed European military help for Ukraine.
____
Dock workers’ strike hits cargo handling at German ports
BERLIN (AP) — Dock workers at Germany’s North Sea ports are on strike in the latest of several walkouts that have added to pressures on shipping as their union demands a hefty pay rise to counter high inflation. The 48-hour strike, ends on Saturday morning, has largely paralyzed cargo handling at major German ports including Hamburg, Bremerhaven and Wilhelmshaven. It follows a 24-hour walkout in June and a previous one-shift warning strike. However, there will be no further strikes before late August under a deal reached at the labor court in Hamburg on Thursday night. The shipping industry already has been disrupted by a variety of issues, including the coronavirus restrictions in China.
____
The S&P 500 rose 72.78 points, or 1.9%, to 3,863.16. The Dow Jones Industrial Average rose 658.09 points, or 2.2%, to 31,288.26. The Nasdaq rose 201.24 points, or 1.8%, to 11,452.42. The Russell 2000 index of smaller companies rose 36.87 points, or 2.2%, to 1,744.37.
___
Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
