Fed keeps rate near zero but sees brighter economy in 2021
WASHINGTON (AP) — The Federal Reserve will keep buying government bonds until the economy makes “substantial” progress, a step intended to reassure financial markets and keep long-term borrowing rates low. The Fed also said after its latest policy meeting that it will keep its short-term benchmark interest rate pegged near zero. The Fed has kept its key rate there since March, when it took a range of extraordinary steps to fight the pandemic recession. In a series of economic projections, Fed officials painted a brighter picture of the economy next year, compared with its last projections in September. The improvement likely reflects the expected impact of the new coronavirus vaccines.
From restaurants to retailers, virus transformed economies
NEW YORK (AP) — The viral pandemic upended economies in the United States and across the world — transforming how people work, travel, eat, shop and congregate. It has changed how students are educated, how people communicate and how households are entertained. It has also widened a gap between educated and affluent people who can work from home and the less fortunate. Even after vaccines have conquered the virus, economies have regained their health and jobless people have found work again, the economic landscape will almost certainly look different. Among the many life-altering consequences of the year 2020, the coronavirus has reshaped how people and businesses engage economically.
Negotiators near agreement on COVID-19 economic aid bill
WASHINGTON (AP) — Top congressional leaders appear to be on the brink of a long-delayed COVID-19 aid package. A deal could come as early as Wednesday on legislation that would extend help to individuals and businesses and ship coronavirus vaccines to millions. Negotiators are working on a $900 billion package that would revive subsidies for businesses hit hard by the pandemic, help distribute new vaccines, fund schools and renew soon-to-expire jobless benefits. They’re also looking to include new direct payments of about $600 to most Americans. There’s intense pressure for a deal. Unemployment benefits run out Dec. 26 for more than 10 million people. Many businesses are barely hanging on after nine months of the pandemic.
Retail sales fell 1.1% in November, biggest drop in 7 months
NEW YORK (AP) — Americans held back on spending during the start of the holiday shopping season, a troubling sign for retailers and the state of the U.S. economy. U.S. retail sales fell a seasonally adjusted 1.1% in November, according to the U.S. Commerce Department. It was the biggest drop in seven months, and a steeper decline than Wall Street analysts had expected. The report points to a weak start to the all-important holiday shopping season, which can usually account for a quarter or more of a retailer’s annual sales. It is also another sign that the pandemic is slowing the U.S. economy as stores face tighter restrictions and people stay away home.
Little-known SolarWinds gets scrutiny over hack, stock sales
AUSTIN, Texas (AP) — Before this week, few people were aware of SolarWinds, a Texas-based software company providing vital computer network monitoring services to corporations and government agencies around the world. But the revelation that elite cyber spies have spent months secretly exploiting SolarWinds software to peer into computer networks has put many of its highest-profile customers in national governments and Fortune 500 companies on high alert. The breach has caused a crisis for the 21-year-old company as it responds to the concerns of thousands of customers that installed a software update that made them vulnerable to hackers.
S&P 500 nears record following stimulus progress, Fed moves
NEW YORK (AP) — The S&P 500 ticked up to the edge of its record Wednesday after the Federal Reserve pledged to keep buying bonds until the economy makes substantial progress from its virus-wracked state. In a mixed and muted day of trading, the S&P 500 rose 0.2%. The Dow inched lower, and the Nasdaq edged up to a record high for the second straight day. The Fed is keeping the accelerator floored on its support for the economy, but investors are more interested in what’s happening across Washington. They want to see Congress reach a deal to deliver another dose of financial support for the economy.
Robinhood accused of downplaying the risks of trading
BOSTON (AP) — Regulators in Massachusetts claim Robinhood Financial targets and manipulates inexperienced investors and has failed to prevent costly outages on its popular stock trading platform. In an administrative complaint filed Wednesday, Secretary of the Commonwealth William Galvin alleges that Robinhood’s business practices violate state securities laws. The state seeks an unspecified fine against Robinhood, among other penalties. Robinhood has nearly half a million customers in Massachusetts with accounts valued at more than $1.6 billion, according to the complaint. The Menlo Park, California-based company said it disagrees with the complaint and intends to mount a vigorous defense.
The S&P 500 rose 6.55 points, or 0.2%, to 3,701.17. The Dow Jones Industrial Average slipped 44.77 points, or 0.1%, to 30,154.54, and the Nasdaq composite rose 63.13, or 0.5%, to 12,658.19. The Russell 2000 index of smaller-company stocks ended down 7.04 points, or 0.4%, at 1,952.72.