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Yahoo
30-04-2025
- Business
- Yahoo
The economy shrinks for the first time since 2022 — and stocks fall sharply
U.S. stock futures pointed sharply down on Wednesday as new data showed the economy contracted for the first time since 2022 and investors braced for a deluge of earnings. Nasdaq futures led the decline, down 1.8% shortly before the opening bell, while the S&P fell 1.3%. The Dow Jones Industrial Average sank 324 points, or 0.8%. Microsoft (MSFT) and Meta (META) report earnings after the bell, while two major economic reports — the advance estimate of first-quarter GDP and the Employment Cost Index — were released before the bell. Here's what to watch today. The U.S. economy shrank for the first time since 2022, as rising imports weighed on GDP and inflation ran hotter than expected. According to the Bureau of Economic Analysis's advance estimate, gross domestic product contracted at an annualized rate of 0.3% in the first quarter — steeper than the 0.2% decline economists had forecast. The drop marked a sharp reversal from the 2.4% growth rate logged in the final quarter of 2024. Prediction markets now point to strong belief that a recession is on the way — or already underway. Visa (V) posted a strong Q2, with non-GAAP EPS up 10% to $2.76 and revenue rising 9% to $9.6 billion. Payments volume grew 8%, cross-border volume rose 13%, and the company announced a $30 billion buyback. Still, the stock moved lower premarket — perhaps because the beat was already baked in. Visa shares are up 25% in the last 12 months. Starbucks (SBUX) shares tumbled 8% after reporting a rough quarter. U.S. comparable sales dropped 2% on a 4% decline in transactions, while international operating income fell 7%. Overall EPS sank 50%. Executives blamed restructuring costs and bad weather, but flat China sales and shrinking foot traffic point to a broader consumer slowdown. Shares sank 9% premarket. Yum Brands (YUM) delivered a solid quarter: EPS rose 13% as strength at Taco Bell and KFC offset weakness at Pizza Hut. CEO David Gibbs credited Yum's global reach, digital momentum, and a new AI partnership with Nvidia (NVDA). Mondelez (MDLZ) also posted strong results, with organic revenue up 4.2% and EPS nearly 9% higher. Emerging markets drove growth, while North America held steady. Cookies and chocolate, it turns out, remain a resilient indulgence even as pricier café visits lose steam. Booking Holdings (BKNG) beat expectations with 8% revenue growth and a 7% increase in gross bookings. Alternative accommodations outpaced traditional hotels, and the company saw a big jump in flight bookings. The results stand in contrast to recent airline warnings, hinting that travelers may be shifting how — but not whether — they spend. For the latest news, Facebook, Twitter and Instagram.
Zawya
30-04-2025
- Business
- Zawya
US labor costs rise moderately in first quarter
U.S. labor costs increased moderately in the first quarter as economic uncertainty caused by tariffs cools demand for labor. The Employment Cost Index (ECI), the broadest measure of labor costs, rose 0.9% in the first quarter after a similar increase in the October-December period, the Labor Department's Bureau of Labor Statistics said on Wednesday. Economists polled by Reuters had forecast the ECI would advance 0.9%. Labor costs increased 3.6% in the 12 months through March after rising 3.8% in the year through December. The ECI is viewed by policymakers as one of the better measures of labor market slack and a predictor of core inflation because it adjusts for composition and job-quality changes. Government data on Tuesday showed there were 1.02 job openings for every unemployed person, slightly down from 1.06 in February. President Donald Trump's sweeping tariffs have eroded business sentiment, which some economists worry could soon translate to job losses. Economists expect the Federal Reserve to resume cutting interest rates at some point this year. Wages and salaries, which account for the bulk of labor costs, climbed 0.8% last quarter after rising 1.0% in the fourth quarter. They advanced 3.5% on an annual basis, slowing from the fourth quarter's 3.8% gain. When adjusted for inflation, overall wages increased 1.1% in the 12 months through March after rising 0.9% in the fourth quarter. Private-sector wages and salaries rose 0.8%. They increased 3.4% in the 12 months through March after rising 3.7% in the fourth quarter. State and local government wages gained 0.8% last quarter, after increasing 1.1% in the October-December quarter. They gained 4.1% in the 12 months through March. Benefits for all workers increased 1.2%. That followed a 0.8% rise in the fourth quarter. They increased 3.8% in the 12 months through March after rising 3.6% in the October-December quarter. (Reporting by Lucia Mutikani; Editing by Paul Simao and Chizu Nomiyama)
Reuters
30-04-2025
- Business
- Reuters
US labor costs rise moderately in first quarter
WASHINGTON, April 30 (Reuters) - U.S. labor costs increased moderately in the first quarter as economic uncertainty caused by tariffs cools demand for labor. The Employment Cost Index (ECI), the broadest measure of labor costs, rose 0.9% in the first quarter after a similar increase in the October-December period, the Labor Department's Bureau of Labor Statistics said on Wednesday. Economists polled by Reuters had forecast the ECI would advance 0.9%. Labor costs increased 3.6% in the 12 months through March after rising 3.8% in the year through December. The ECI is viewed by policymakers as one of the better measures of labor market slack and a predictor of core inflation because it adjusts for composition and job-quality changes. Government data on Tuesday showed there were 1.02 job openings for every unemployed person, slightly down from 1.06 in February. President Donald Trump's sweeping tariffs have eroded business sentiment, which some economists worry could soon translate to job losses. Economists expect the Federal Reserve to resume cutting interest rates at some point this year. Wages and salaries, which account for the bulk of labor costs, climbed 0.8% last quarter after rising 1.0% in the fourth quarter. They advanced 3.5% on an annual basis, slowing from the fourth quarter's 3.8% gain. When adjusted for inflation, overall wages increased 1.1% in the 12 months through March after rising 0.9% in the fourth quarter. Private-sector wages and salaries rose 0.8%. They increased 3.4% in the 12 months through March after rising 3.7% in the fourth quarter. State and local government wages gained 0.8% last quarter, after increasing 1.1% in the October-December quarter. They gained 4.1% in the 12 months through March. Benefits for all workers increased 1.2%. That followed a 0.8% rise in the fourth quarter. They increased 3.8% in the 12 months through March after rising 3.6% in the October-December quarter.
Yahoo
30-04-2025
- Business
- Yahoo
US labor costs rise moderately in first quarter
WASHINGTON (Reuters) -U.S. labor costs increased moderately in the first quarter as economic uncertainty caused by tariffs cools demand for labor. The Employment Cost Index (ECI), the broadest measure of labor costs, rose 0.9% in the first quarter after a similar increase in the October-December period, the Labor Department's Bureau of Labor Statistics said on Wednesday. Economists polled by Reuters had forecast the ECI would advance 0.9%. Labor costs increased 3.6% in the 12 months through March after rising 3.8% in the year through December. The ECI is viewed by policymakers as one of the better measures of labor market slack and a predictor of core inflation because it adjusts for composition and job-quality changes. Government data on Tuesday showed there were 1.02 job openings for every unemployed person, slightly down from 1.06 in February. President Donald Trump's sweeping tariffs have eroded business sentiment, which some economists worry could soon translate to job losses. Economists expect the Federal Reserve to resume cutting interest rates at some point this year. Wages and salaries, which account for the bulk of labor costs, climbed 0.8% last quarter after rising 1.0% in the fourth quarter. They advanced 3.5% on an annual basis, slowing from the fourth quarter's 3.8% gain. When adjusted for inflation, overall wages increased 1.1% in the 12 months through March after rising 0.9% in the fourth quarter. Private-sector wages and salaries rose 0.8%. They increased 3.4% in the 12 months through March after rising 3.7% in the fourth quarter. State and local government wages gained 0.8% last quarter, after increasing 1.1% in the October-December quarter. They gained 4.1% in the 12 months through March. Benefits for all workers increased 1.2%. That followed a 0.8% rise in the fourth quarter. They increased 3.8% in the 12 months through March after rising 3.6% in the October-December quarter. Sign in to access your portfolio
Axios
28-04-2025
- Business
- Axios
Extra-murky economic data is dropping this week
This is set to be a blockbuster week for economic data. Making sense of it will be even trickier than usual, given trade war-induced crosscurrents. The big picture: New readings on GDP, employment, and more will shed some light on how the economy has fared heading into spring, but businesses' efforts to get ahead of tariffs — both in their supply chains and hiring decisions — will make for murky data readings. It's not just that the future is uncertain. More so than usual, the present and recent past are uncertain. Driving the news: On Tuesday, we get data on job openings and hiring for March. Wednesday, the initial release of Q1 GDP is due out, as is the Employment Cost Index (the gold standard for measuring wage inflation) and data on March personal income and consumption. Then, on Friday, comes April data on payrolls and unemployment — the first "hard data" to cover the period after President Trump announced aggressive global tariffs on April 2. All of these carry unusual asterisks due to the overhang of trade policy uncertainty — but with uncertain magnitudes. State of play: GDP is being affected by businesses importing goods to build a stockpile before tariffs go into effect. In the arithmetic of GDP, imports subtract from growth. But an inventory buildup increases growth. When businesses ramp up imports and build up inventories, those forces should offset and be neutral for GDP growth. But measurement challenges may mess up that relationship, Goldman Sachs chief economist Jan Hatzius said, as inventories are one of the less-reliable parts of the GDP data. Zoom out: It's not just businesses that have been looking to get ahead of tariffs; it's consumers, too, which would show up in the consumption expenditures data out Wednesday. But the flip side of Americans pulling forward purchases of cars and other durable goods is a likely weak patch in demand in subsequent months, regardless of what else is happening in the economy. What they're saying:"One issue in reading the data is pre-buying," Hatzius told reporters Friday. "That's going to make it very difficult to see in hard dollar numbers what is really going on with the economy." "Anecdotally, I'm sure you know people who bought a car because they're worried about tariffs," he said, noting a surge in March auto sales seen in recent retail sales data. "I know several people who bought a car because they were worried about tariffs." Between the lines: In the labor market, different dynamics apply. There's scant evidence that companies are engaging in large-scale layoffs; weekly data on jobless claims has remained stable. But trade war dynamics and jittery markets may be making companies reluctant to hire. Whether that will be enough to affect April payrolls data, however, is an open question. The reference week for this report covered the time period just after Trump announced his so-called reciprocal tariffs and encompasses the period when he partially backed down. Still, hiring processes don't turn on a dime, so the data out Friday is more likely to reflect companies' longer-term economic outlook.
