Wall Street stocks end down, inflation data, China trade in focus
Investors expect the recent shakeup at the U.S. Federal Reserve and signs of labor market weakness could nudge the central bank into adopting a dovish monetary policy stance later this year, fueling much of the optimism.
July's consumer inflation report is due on Tuesday, and investors anticipate that the Fed will lower borrowing costs by about 60 basis points by December, according to data compiled by LSEG.
"Markets are on rate watch, so anything inflation-related will move markets this week," said Jamie Cox, managing partner at Harris Financial Group. "It's all about three rate cuts versus two at this point."
According to preliminary data, the S&P 500 (.SPX), opens new tab lost 15.13 points, or 0.24%, to end at 6,374.32 points, while the Nasdaq Composite (.IXIC), opens new tab lost 62.99 points, or 0.29%, to 21,388.60. The Dow Jones Industrial Average (.DJI), opens new tab fell 193.29 points, or 0.44%, to 43,982.32.
Shares of Nvidia (NVDA.O), opens new tab and Advanced Micro Devices (AMD.O), opens new tab were volatile through the day.
A U.S. official told Reuters the semiconductor majors had agreed to give the United States government 15% of revenue from sales of their advanced chips to China.
Analysts said the levy could hit the chipmakers' margins and set a precedent for Washington to tax critical U.S. exports, potentially extending beyond semiconductors.
Separately U.S. President Donald Trump signed an executive order extending a pause in sharply higher U.S. tariffs on Chinese imports for another 90 days, a White House official said.
Enabling semiconductor sales to China was an integral issue in the agreement Washington and Beijing signed this year, which expires on Tuesday. Trump lauded China's cooperation in talks at a White House press conference on Monday.
Traders took a step back after the S&P 500 (.SPX), opens new tab and the Nasdaq (.IXIC), opens new tab last week logged their strongest weekly performances in more than a month.
Citigroup and UBS Global Research became the latest brokerages to raise their year-end targets for the benchmark S&P 500.
Micron Technology (MU.O), opens new tab raised its forecast for fourth-quarter revenue and adjusted profit, boosting its shares.
Intel (INTC.O), opens new tab rallied after a report said CEO Lip-Bu Tan was expected to visit the White House. Trump had called for his removal last week.
TKO (TKO.N), opens new tab jumped after Paramount (PSKY.O), opens new tab bought the rights from the live entertainment company to exclusively distribute UFC events for the next seven years in a deal valued at around $7.7 billion.
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The Independent
15 minutes ago
- The Independent
Shopping for school supplies becomes a summer activity as families juggle technology and tariffs
Feeling nostalgic for the days when going back to school meant picking out fresh notebooks, pencils and colored markers at a local drugstore or stationary shop? The annual retail ritual is both easier and more complicated for today's students. Chains like Walmart generate online lists of school supplies for customers who type in their zip codes, then choose a school and a grade level. One click and they are ready to check out. Some schools also offer busy parents a one-stop shop by partnering with vendors that sell premade kits with binders, index cards, pens and other needed items. Yet for all the time-saving options, many families begin their back-to-school shopping months before Labor Day, searching around for the best deals and making purchases tied to summer sales. This year, the possibility of price increases from new U.S. tariffs on imports motivated more shoppers to get a jump start on replacing and refilling school backpacks, according to retail analysts. Retail and technology consulting company Coresight Research estimates that back-to-school spending from June through August will reach $33.3 billion in the U.S., a 3.3% increase from the same three-month period a year ago. The company predicted families would complete about 60% of their shopping before August to avoid extra costs from tariffs. ' Consumers are of the mindset where they're being very strategic and conscientious around price fluctuations, so for back to school, it prompts them to shop even earlier,' said Vivek Pandya, lead analyst at Adobe Digital Insights, the research division of software company Adobe Inc. Getting a head start Miami resident Jacqueline Agudelo, 39, was one of the early birds who started shopping for school supplies in June because she wanted to get ahead of possible price increases from new U.S. tariffs on imported products. The teacher's supply list for her 5-year-old son, who started kindergarten earlier this month, mandated specific classroom items in big quantities. Agudelo said her shopping list included 15 boxes of Crayola crayons, Lysol wipes and five boxes of Ticonderoga brand pencils, all sharpened. Agudelo said she spent $160 after finding plenty of bargains online and in stores, including the crayons at half off, but found the experience stressful. 'I am overwhelmed by the need to stay on top of where the deals are as shopping has become more expensive over the years,' she said. A lot of the backpacks, lined paper, glue sticks — and Ticonderoga pencils — sold in the U.S. are made in China, whose products were subjected to a 145% tariff in the spring. Under the latest agreement between the countries, Chinese goods are taxed at a 30% rate when they enter the U.S. Many companies accelerated shipments from China early in the year, stockpiling inventory at pre-tariff prices. Some predicted consumers would encounter higher prices just in time for the back-to-school shopping season. Although government data showed consumer prices rose 2.7% last month from a year earlier, strategic discounting by major retailers may have muted any sticker shock for customers seeking school supplies. Backpacks and lunchboxes, for example, had discounts as deep as 12.1% during Amazon's Prime Day sales and competing online sales at Target and Walmart in early July, Adobe Insights said. Throughout the summer, some of the biggest chains have are advertising selective price freezes to hold onto customers. Walmart is advertising a 14-item school supplies deal that costs $16, the lowest price in six years, company spokesperson Leigh Stidham said. Target said in June that it would maintain its 2024 prices on 20 key back-to-school items that together cost less than $20. An analysis consumer data provider Numerator prepared for The Associated Press showed the retail cost of 48 products a family with two school age children might need — two lunchboxes, two scientific calculators, a pair of boy's shoes — averaged $272 in July, or $3 less than the same month last year. Digital natives in the classroom Numerator, which tracks U.S. retail prices through sales receipts, online account activity and other information from 200,000 shoppers, reported last year that households were buying fewer notebooks, book covers, writing instruments and other familiar staples as students did more of their work on computers. The transition does not mean students no longer have to stock up on plastic folders, highlighters and erasers, or that parents are spending less to equip their children for class. Accounting and consulting firm Deloitte estimates that traditional school supplies will account for more than $7 billion of the $31 billion it expects U.S. parents to put toward back-to-school shopping. Shopping habits also are evolving. TeacherLists, an online platform where individual schools and teachers can upload their recommended supply lists and parents can search for them, was launched in 2012 to reduce the need for paper lists. It now has more than 2 million lists from 70,000 schools. Users have the option of clicking on an icon that populates an online shopping cart at participating retail chains. Some retailers also license the data for use on their websites and in their stores, said Dyanne Griffin, the architect and vice president of TeacherLists. The typical number of items teacher request has remained fairly steady at around 17 since the end of the coronavirus pandemic, Griffin said. 'The new items that had come on the list, you know, in the last four or five years are more the tech side. Everybody needs headphones or earbuds, that type of thing, maybe a mouse,' she said. She's also noticed a lot of schools requiring clear backpacks and pencil pouches so the gear can't be used to stow guns. Enter artificial intelligence For consumers who like to research their options before they buy, technology and retail companies have introduced generative AI tools to help them find and compare products. Rufus, the AI-powered shopping assistant that Amazon launched last year, is now joined by Sparky, an app-only feature that Walmart shoppers can use to get age-specific product recommendations and other information in response to their questions. Just over a quarter of U.S. adults say they use AI for shopping, which is considerably lower than the number who say they use AI for tasks such as searching for information or brainstorming, according to an Associated Press-NORC Center for Public Affairs Research poll in July. Some traditions remain Before the pandemic turned a lot more people into online shoppers, schools and local Parent Teacher Associations embraced the idea of making back-to-school shopping easier by ordering ready-made bundles of teacher-recommended supplies. An extra fee on the price helped raise money for the school. Market data from Edukit, a supplier of school supply kits owned by TeachersList parent company School Family Media, shows that about 40% of parents end up buying the boxes, meaning the other 60% need to shop on their own, Griffin said. She noted that parents typically must commit no later than June to secure a bundle, which focus on essentials like notebooks and crayons. Agudelo said her son's school offered a box for $190 that focused on basics like crayons and notebooks but didn't include a backpack. She decided to pass and shop around for the best prices. She also liked bringing her son along for the shopping trips. 'There's that sense of getting him mentally prepared for the school year,' Agudelo said. 'The box takes away from that.'
Reuters
15 minutes ago
- Reuters
New York sues Zelle, says security lapses led to 'rampant' consumer fraud
NEW YORK, Aug 13 (Reuters) - Zelle was sued on Wednesday by New York Attorney General Letitia James, who said the electronic payment platform's refusal to adopt critical safety features enabled fraudsters to steal more than $1 billion from consumers. The lawsuit in a New York state court in Manhattan followed the U.S. Consumer Financial Protection Bureau's decision in March to drop a similar case. That agency has ended most enforcement activity following U.S. President Donald Trump's return to the White House. Zelle was launched in 2017, and competes with apps such as PayPal's (PYPL.O), opens new tab Venmo and Block's (XYZ.N), opens new tab Cash App. Its parent, Early Warning Services, is owned by seven large U.S. banks: Bank of America (BAC.N), opens new tab, Capital One (COF.N), opens new tab, JPMorgan Chase (JPM.N), opens new tab, PNC (PNC.N), opens new tab, Truist (TFC.N), opens new tab, US Bank (USB.N), opens new tab and Wells Fargo (WFC.N), opens new tab. James said Zelle's parent and the banks knew for years that the platform was vulnerable to fraudsters but ignored basic safeguards, with the banks sometimes ignoring customer complaints while Zelle let fraudsters stay on the platform. The result was "rampant" fraud, according to the complaint. Typical scams involved hacking into users' accounts and making unauthorized transfers, convincing users to send money for nonexistent goods and services, and impersonating banks, government offices and utilities. James said one victim was told his electricity would be shut off unless he paid Con Edison $1,477 via Zelle, to an account named "Coned Billing." The lawsuit seeks to require Zelle to beef up its anti-fraud protections, and pay restitution and damages to defrauded New Yorkers. "No one should be left to fend for themselves after falling victim to a scam," James said in a statement. Early Warning Services did not immediately respond to a request for comment. The banks were not named as defendants. James sued Capital One in May for allegedly cheating savings depositors out of millions of dollars in interest, and in June settled claims against MoneyGram over remittance transfer lapses. The CFPB abandoned similar cases earlier in the year.
Reuters
44 minutes ago
- Reuters
Shadow tanker fleet grows more slowly as Western sanctions target Russian oil
LONDON, Aug 13 (Reuters) - Dozens of tankers have joined the shadow fleet this year compared with hundreds in previous years as the harshest Western sanctions yet target Russia's oil exports and add to the difficulty of finding suitable vessels, shipping sources said. The European Union and Britain last month imposed further sanctions on Russia over its war in Ukraine. Together with U.S. restrictions, they mean more than 440, opens new tab shadow fleet tankers face sanctions, including tankers Moscow needs to ship oil to its biggest buyers, China and India. The shadow fleet of vessels is used by Venezuela and Iran, as well as Russia to evade Western sanctions. Typically, the vessels are old, their ownership is opaque, and they sail without top-tier insurance cover to meet international standards for oil majors and many ports. Since the Ukraine war began in 2022, the shadow fleet has been especially used by Russia, which has relied on oil revenues to help finance its war effort. In addition to the sanctions, the Group of Seven countries has imposed a cap over what price level Russian oil can be sold at, adding to trade complexities. The size of the fleet is between 1,200 and 1,600 tankers, according to estimates from industry sources and analysts, including Lloyd's List Intelligence and shipbroker Gibson. This represents an estimated fifth of the overall global tanker fleet. That compares with a few hundred vessels operating before the Ukraine war, but sources say its growth has slowed year-on-year as the list of sanctions has grown and sales of second-hand ships have been under more scrutiny from authorities and legal compliance teams. The estimate of the shadow fleet's size does not include hundreds of smaller coastal tankers, which are not ocean-going but have transported oil, chiefly for Russia. "Regulators are closing the net," Anna Giacomello, analyst with British maritime cyber defence and risk intelligence company Dryad Global, said in a July report. For all the risks, the potential for profit remains a lure for some. "Operators may still enter the shadow fleet because it can be highly lucrative," said Leigh Hansson, sanctions partner at law firm Reed Smith, who advises shipping and trading companies on oil sanctions compliance. But she said the major established players would stay away and that only those with little experience of the shipping market may be willing to engage in risky operations, with older vessels that major ship insurers will not cover.
