Business Highlights: Back-to-school inflation, OPEC output
China blocks some Taiwan imports but avoids chip disruptions
BEIJING (AP) — China has blocked imports of citrus, fish and other foods from Taiwan in retaliation for a visit by U.S. House Speaker Nancy Pelosi but avoided disrupting one of the world’s most important technology and manufacturing relationships. Sanctions on Taiwanese processor chips for Chinese assemblers of smartphones and other electronics could send shockwaves through the global economy. Beijing has announced military exercises including artillery fire in waters near Taiwan following Pelosi’s arrival in Taipei. That might delay or disrupt shipping. The potential disruption to trade and manufacturing adds to concerns that global economic growth might be weakening. Asian stock markets rose after there was no immediate sign of Chinese military action.
Inflation weighs on back-to-school buying for many families
NEW YORK (AP) — This back-to-school shopping season, parents are focusing on the basics while also trading down to cheaper stores as surging inflation takes a toll on their household budgets. That is particularly true for parents in the low to middle income bracket. Last week, Walmart noted higher prices on gas and food are forcing shoppers to make fewer purchases of discretionary items, particularly clothing. Best Buy, the nation’s largest consumer electronics chain, cited that inflation has dampened consumer spending on gadgets. Such financial struggles amid the industry’s second-most important shopping season behind the winter holidays mark a big difference from a year ago when many low-income shoppers, flush with government stimulus and buoyed by wage increases, spent freely.
OPEC+ boosts oil output by slower pace than previous months
The OPEC oil cartel and its allies have decided to boost production in September by a much slower pace than in previous months. The move Wednesday comes amid high gasoline prices and unstable energy supplies exacerbated by the war Russia is waging on Ukraine. OPEC, led by Saudi Arabia, and its allies, led by Russia, say they will increase output to 100,000 barrels a day next month after raising it by 648,000 barrels per day in July and August. It comes after U.S. President Joe Biden visited Saudi Arabia last month, aiming to improve relations and encourage more oil production from OPEC to draw down high prices at the pump.
US stocks rise following solid earnings reports
NEW YORK (AP) — Stocks are closing higher on Wall Street Wednesday as investors reviewed a mostly encouraging batch of earnings from big companies. The S&P 500 rose 1.6% to an almost 2-month high. The Nasdaq and Dow Jones industrials also rose. Starbucks and CVS closed higher after reporting solid quarterly results. PayPal shares soared on a report that activist investor Elliott Management has taken a large stake in the payment company. The 10-year Treasury yield slipped. Oil prices fell after the OPEC oil cartel and its allies decided to boost production in September by a much slower pace than in previous months.
New crypto oversight legislation arrives as industry shakes
WASHINGTON (AP) — After 13 years, at least three crashes, dozens of scams and Ponzi schemes and hundreds of billions of dollars made and evaporated, cryptocurrencies finally have the full attention of Congress. Lawmakers and lobbyists have papered Capitol Hill with proposals on how to regulate the industry. A proposal Wednesday from Democratic Sen. Debbie Stabenow of Michigan and Republican Sen. John Boozman of Arkansas would hand the regulatory authority over Bitcoin and Ether to the Commodities Futures Trading Commission. Bills proposed by other members of Congress and consumer advocates have suggested giving the authority to the Securities and Exchange Commission.
Inspectors OK 1st Ukraine grain ship but no sign yet of more
ISTANBUL (AP) — The first grain ship to leave Ukraine under a Black Sea wartime deal has passed inspection in Istanbul and is heading on to Lebanon. Ukraine says 17 other vessels at its ports are loaded with grain and waiting permission to leave. There was no word yet, however, on when they could depart. Authorities said a joint civilian inspection team spent three hours Wednesday checking the cargo and crew on the ship Razoni. The wartime deal aimed to ease food security around the globe by creating a safe corridor across the Black Sea. Elsewhere, Russian forces kept up their bombardment of a southern Ukrainian city but in the east, Ukrainian forces said they repulsed over a dozen Russian assaults in Donetsk province.
Nintendo’s profit rises despite shortages of computer chips
TOKYO (AP) — Nintendo’s profit in the April-June quarter rose 28% from a year earlier on healthy demand for its games, although console sales were dented by a shortage of semiconductors. The Japanese video game maker behind the Super Mario and Pokemon franchises said it expects to sell 21 million Switch machines in the fiscal year that ends in March 2023. Other game makers like Sony are also hurting due to the chips shortage but have also gotten a boost from COVID-19, which kept people at home. As pandemic precautions ease, that boost for sales and profits is wearing off.
NLRB orders mine workers union to pay coal company over $13M
BIRMINGHAM, Ala. (AP) — A federal oversight board is ordering the United Mine Workers of America to pay more than $13 million in compensation to an Alabama coal company where members have been on strike for more than a year. The National Labor Relations Board says Warrior Met Coal Mining is due some $13.3 million for costs including increased security, damage repair and lost revenues from unmined coal. It says individuals are due almost $30,000, mostly for damage to vehicles. The union calls the NLRB assessment an “outrageous” decision that it plans to fight. Roughly 1,100 members went on strike against the Alabama-based company on April 1, 2021.
The S&P 500 ended up 63.98 points, or 1.6%, to 4,155.17. The Dow Jones Industrial Average rose 416.33 points, or 1.3%, to 32,812.50. The Nasdaq jumped 319.40 points, or 2.6%, to 12,668.16. The Russell 2000 index of smaller companies gained 26.48 points, or 1.4%, to 1,908.93.