NEW YORK (AP) — Most of Wall Street is moving higher in midday trading, though a rare pullback for some of the year’s biggest winners in the stock market is tamping down the gains.
Stocks of companies that most need the economy to continue improving and reopening are taking the lead, including United Airlines and cruise operator Carnival. Gilead (GIHL’-ee-uhd) Sciences rose after it said its investigative treatment for COVID-19, remdesivir, helped reduce the risk of mortality in patients. Banks are also strong, and energy stocks climbed with the price of oil.
On the losing end are some of the big tech stocks that have been holding up best this year, including Apple and Microsoft.
US wholesale prices fell 0.2% in June as food costs plunged
WASHINGTON (AP) — U.S. wholesale prices fell 0.2% in June as food costs dropped sharply, offsetting a big increase in energy prices. The Labor Department said the drop in its Producer Price Index, which measures inflation pressures before they reach consumers, followed a 0.4% gain in May.
Wholesale prices have fallen in four of the past five months. The country has been pushed into a deep recession which is expected to see the economy shrink in the April-June quarter by a record-shattering amount. That downturn, triggered by efforts to contan the coronavirus pandemic, is expected to keep inflation under control.
The 0.2% drop in wholesale prices in June reflected a 5.2% decline in food costs which helped to offset a 7.7% jump in energy prices.
MIAMI (AP) — President Donald Trump suggested Friday that work on the second phase of a U.S.-China trade deal has become a low priority, saying the two nation’s relationship has been “severely damaged” by Beijing’s handling of the coronavirus pandemic. Speaking aboard Air Force One on his way to Miami, Trump repeated his persistent criticism that China could have done more to stop the spread of the virus, which originated in Wuhan province.
The United States and China signed phase one of a trade agreement in January, boosting stock markets and seemingly ending a trade war. Trump did not completely rule out working on phase two of the deal but made clear that it was not a top concern.
Airlines continue to struggle
UNDATED (AP) — Standard & Poor’s has downgraded United Airlines’ credit one notch deeper into junk territory, to B+, citing a setback in air travel’s recovery when the coronavirus spikes. United said this week that bookings have slowed because of a flare-up in virus cases, and it warned 36,000 employees could be furloughed in October.
Allegiant Travel Co.’s passengers in June dropped 45.6% from the prior-year period, according to preliminary data. The airline had 867,207 passengers last month compared with approximately 1.6 million a year ago. Departures declined 20%. Allegiant said it operated 70% of its schedule in June and plans to run about 75% of its schedule into the third quarter but will make any necessary adjustments as dictated by demand trends. For the second quarter, Allegiant’s number of passengers tumbled 69.4% and its departures fell 50.3%.
Hawaiian Holdings says it continues to experience significant operating losses due to significantly weakened travel demand. A regulatory filing from the company — which runs Hawaiian Airlines — disclosed that it anticipates reducing its employee headcount. The company did not specify how many jobs might be eliminated. Hawaiian said it plans to offer voluntary reduction options.
Express moves forward with reopenings
UNDATED (AP) — Clothing company Express has reopened about 95% of its stores as of Monday. The chain anticipates the rest of its store reopening in the coming weeks.
Express currently has ship from store capabilities at more than 330 locations and buy-online-pick-up-at-a-store service enacted at more than 275 stores. It plans to have buy online pick up at store service available at all locations by the end of the third quarter. Express has more than 500 retail and factory outlet stores in the U.S. and Puerto Rico.
Meanwhile, bankruptcy filings continue. Muji U.S.A Ltd., the U.S. entity of Japanese retailer Ryohin Keikak, is seeking Chapter 11 protection. The company joins a growing list of businesses that have filed for bankruptcy protection during the pandemic, including Brooks Brothers earlier this week.
Nevada reinstates bar restrictions
CARSON CITY, Nev. (AP) — Nevada’s governor says the state will reimplement restrictions on bars and restaurants in certain counties to prevent further spread of the coronavirus after a spike in confirmed cases. The newest order begins tonight at midnight. It requires bars that do not serve food to close their doors. Restaurants will stop serving parties of six or more. Gov. Steve Sisolak didn’t provide a list of counties where the directive would be in effect but said it would include Reno and Las Vegas. It’s the second time Nevada has tightened restrictions since the state began reopening in early June. The number of confirmed cases rose throughout the month, prompting the governor to announce a statewide mask mandate on June 24.
Michigan Gov. Gretchen Whitmer on Friday toughened a requirement to wear masks. It mandates that businesses open to the public deny service or entry to customers who refuse to wear one.
US bets on small, untested company to deliver vaccine
UNDATED (AP) — When precious vats of COVID-19 vaccine are finally ready, jabbing the lifesaving solution into the arms of Americans will require hundreds of millions of injections.
As part of its strategy to administer the vaccine as quickly as possible, the Trump administration has agreed to invest more than half a billion in tax dollars in ApiJect Systems America, a young company whose injector is not approved by federal health authorities and that hasn’t yet set up a factory to manufacture the devices.
The commitment to ApiJect dwarfs the other needle orders the government has placed with a major manufacturer and two other small companies.
Electric vehicle startup Rivian gets $2.5B in added funding
DETROIT (AP) — Electric vehicle startup Rivian says it has raised another $2.5 billion in funding from accounts advised by investment firm T. Rowe Price.
The company has a contract with Amazon to build 100,000 electric delivery vans starting next year at its factory, a former Mitsubishi plant in Normal, Illinois. Rivian also is rolling out a pickup truck and an SUV for sale to consumers next year. The company said Friday that investors in this round include Soros Fund Management, Coatue, Fidelity Management and Research, and Baron Capital Group. Amazon and hedge fund BlackRock have invested previously and also are part of this round, Rivian said.
In April of 2019, Ford invested a half-billion dollars into Rivian and said the companies would work jointly to develop electric vehicles. That deal was in addition to a $700 million investment from Amazon that was announced in February of 2019.
Most of Rivian’s operations are in San Jose and Irvine, California, but it also has a large engineering and administrative office near Detroit. The company employs about 2,300 people.
Libyan oil company resumes exports after months of blockade
CAIRO (AP) — Libya’s national oil company announced Friday it has resumed crude exports, ending a months-long blockade that eastern tribes had called to protest revenue distribution in the war-torn country.
The National Oil Corporation said the resumption of exports from Libya started on a small scale and would reach just 650,000 barrels a day by 2022 because extensive repairs are needed in the facilities following months of neglect.
Oil, the lifeline of the Libyan economy, has been a key factor in the civil war, as the two rival governments and militias jostle for control over the coveted revenue. Powerful tribes loyal to east-based military commander had reduced the country’s production of 1.2 million barrels a day to a trickle in January. Last week, the tribes offered to end the blockade and negotiate a restart in production as part of a political settlement.
SEATTLE (AP) — A homeless shelter built on Amazon’s perfectly manicured urban Seattle campus is a major civic contribution that pushes the company to face the crisis and criticism in the hometown it has rapidly transformed. Believed to be the first homeless shelter built inside a corporate office building, Amazon’s partnership housing a local nonprofit could be seen as the company’s answer to criticism that it hasn’t given back enough to the city.
But as Mary’s Place settles into its new space after opening in March, it’s also a stark display of have-and-have-nots. When Amazon’s offices reopen post-pandemic, the tens of thousands of high-paid tech workers who helped drive up housing costs in the region will now share its pricey downtown neighborhood with vulnerable families who can’t afford any place to live.
Some blame Amazon’s explosive growth over the past decade for making living in Seattle too costly for a growing number of people.