Stocks end lower after report on Biden’s tax proposal
NEW YORK (AP) — Stocks ended lower on Wall Street Thursday after dropping in afternoon trading on a report that President Biden will propose a hefty tax increase on the gains wealthy individuals reap from investments. The S&P 500 lost 0.9%. Big Tech companies like Apple and Microsoft accounted for a good part of the losses. Investors are also focused on company earnings reports, the state of the virus outbreak, the pace of vaccinations and the prospects for the economic recovery to continue. AT&T rose after releasing results that beat expectations, helped by higher wireless charges and its HBOMax video streaming service.
US jobless claims fall to 547,000, another pandemic low
WASHINGTON (AP) — The number of Americans applying for unemployment aid fell last week to 547,000, a new low since the pandemic struck and a further encouraging sign that layoffs are slowing on the strength of an improving job market. The Labor Department said Thursday that applications declined 39,000 from a revised 586,000 a week earlier. Weekly jobless claims are down sharply from a peak of 900,000 in early January. But they’re still far above the roughly 250,000 level that prevailed before the viral outbreak ripped through the economy in March of last year.
Countering Biden, GOP pitches $568B for infrastructure
WASHINGTON (AP) — Senate Republicans have unveiled a public works proposal with a much smaller price tag than what President Joe Biden wants. The $568 billion plan unveiled Thursday shows there are big differences between the two sides that will be hard to overcome. The Republican proposal would spend $568 billion over five years, while Biden has proposed spending $2.3 trillion over eight years. To help pay for their plan, the Republicans would rely on user fees and on redirecting unspent federal dollars. The Republicans reject Biden’s proposal to pay for infrastructure by raising the corporate tax rate.
Supreme Court cuts back FTC power to seek ill-gotten gains
WASHINGTON (AP) — A unanimous Supreme Court has cut back the Federal Trade Commission’s authority to recover ill-gotten gains. The justices have overturned a nearly $1.3 billion award against a professional race car driver who was convicted of cheating consumers through his payday loan businesses. The high-court ruling Thursday takes away what the FTC has called “one of its most important and effective enforcement tools,” used in recouping billions of dollars over the past decade. Justice Stephen Breyer wrote in his opinion for the court that the provision of federal law the FTC has relied on does not authorize the commission to seek or a federal court to order restitution or disgorgement of profits.
US aid lifts Southwest to Q1 profit, American loses $1.25B
DALLAS (AP) — The long pandemic nightmare for airlines seems to be easing. Southwest Airlines said Thursday that it earned $116 million in the first quarter, thanks to federal aid that helped cover labor costs. With the taxpayer money, Southwest would have lost $1 billion. And American Airlines lost $1.25 billion. Still, the CEOs of both airlines were upbeat, citing an increase in bookings going into the critical summer vacation season. Southwest CEO Gary Kelly says that when it comes to travel demand, the worst is behind the airlines.
Screws tighten for home buyers in March, prices surge 17.2%
NEW YORK (AP) — Sales of previously occupied U.S. homes fell in March for the second straight month as buyers grappled with a stubbornly low inventory of available properties and fierce competition pushed prices to new highs. The National Association of Realtors said Thursday that existing home sales fell 3.7% last month from February to a seasonally adjusted rate of 6.01 million annualized units. Sales jumped 12.3% from March last year. The report also showed that the U.S. median home price jumped 17.2% in March from a year earlier to $329,100, an all-time high. At the end of March, the inventory of unsold homes stood at just 1.07 million homes for sale. At the current sales pace, that amounts to a 2.1 months’ supply.
Consumer Reports tricks Tesla to drive with no one at wheel
SILVER SPRING, Md. (AP) — Consumer Reports says it was able to easily trick a Tesla into driving in the car’s Autopilot mode without a person in the driver’s seat. Its revelation comes just days after a Tesla crashed in Texas, killing the two men in the car. Authorities say neither of the men were behind the wheel at the time of the Texas crash. Consumer Reports said Thursday that during several trips on its closed tracks with an empty driver’s seat, its Tesla Model Y automatically steered along painted lane lines without acknowledging that nobody was at the controls. Tesla, which has disbanded its press office, did not immediately respond to inquiries about the Consumer Reports assertions.
US average mortgage rates under 3% for first time since Feb.
McLEAN, Va. (AP) — Mortgage rates fell for the third straight week, dipping below 3% for the first time in two months. Mortgage buyer Freddie Mac reported Thursday that the benchmark 30-year home-loan rate declined to 2.97% this week from 3.04% last week. At this time last year, the long-term rate was 3.33%. The rate for a 15-year loan, popular among those looking to refinance, dipped to 2.29% from 2.35% the week before. Even with historically low rates, buyers are having a hard time snatching up homes because there are so few for sale.
The S&P 500 lost 38.44 points, or 0.9% to 4,134.98. The Dow Jones Industrial Average fell 321.41 points, or 0.9%, to 33,815.90. The Nasdaq slid 131.81 points, or 0.9%, to 13,818.41. The Russell 2000 index of smaller-company stocks gave up 7.01 points, or 0.3%, to 2,232.61.