As chip shortage goes on, cars are scarce and prices are up
DETROIT (AP) — Automakers are cutting production as they grapple with a global shortage of computer chips, and that’s making dealers nervous. With sales at a brisk pace despite high prices, and inventories shrinking, many fear they’ll run out of new vehicles to sell this summer. They’re buying up used cars with hopes of selling them to make money until production returns to normal. But no one is sure when that’s going to happen. Ford has warned that it expects to make only half the normal number of vehicles from now through June. General Motors and others have stopped making some smaller cars and SUVs and diverted chips to higher-profit pickup trucks and big SUVs.
Colonial Pipeline restarts operations days after major hack
CLEMMONS, N.C. (AP) — The nation’s largest fuel pipeline restarted operations Wednesday, days after it was forced to shut down by a gang of hackers. The disruption caused long lines at gas stations in the Southeast due to distribution problems and panic-buying, draining supplies at thousands of gas stations. Colonial said all lines, including those lateral lines that have been running manually, will return to normal operations. But it will take several days for deliveries to return to normal, the company said. In the meantime, drivers have been finding gas stations with little or no gas in some Southeast states.
Consumer prices shot up 0.8% in April as worries escalate
WASHINGTON (AP) — A worrisome bout of inflation struck the economy in April, with U.S. consumer prices surging 0.8%, the largest monthly jump in in more than a decade and the year-over-year increase reaching its fastest rate since 2008. The acceleration in prices, which has been building for months, has unsettled financial markets and raised concerns that it could weaken the economic recovery from the pandemic recession. One-third of the April came from a record 10% increase in the price of used cars and trucks. Wednesday’s report from the Labor Department indicated that that the 0.8% rise prices that consumers pay for everything from food and clothes to new cars was the biggest one-month gain.
Stocks sink again on Wall Street as inflation worries mount
NEW YORK (AP) — Stocks pulled back again on Wall Street after a surprisingly big jump in inflation last month worsened worries among investors that the economy may run too hot as it bounces back from its pandemic-induced recession. Tech giants, which had soared during the past year of lockdowns, took some of the biggest losses. The slump put major indexes on track for their worst weekly losses since October. The S&P 500 lost 2.1% Wednesday, bringing its drop so far this week to 4%. Bond yields snapped higher after the government reported that consumer prices rose in April at the fastest year-over-year rate since 2008.
Rising commodities costs hit Americans at home and on road
NEW YORK (AP) — Rising prices for a variety of commodities are contributing to a jump in prices at the consumer level. The government said Wednesday that consumer prices surged 0.8% in April from March, while the year-over-year rise was the fastest since 2008. The cost of corn and soybeans used for animal feed is at the highest since 2012, boosting the price of meat. The price of lumber is at an all-time high, contributing to record home prices. Higher oil prices and rising demand for gasoline has helped push the average price of a gallon above $3 for the first time since 2014. Diapers and toilet paper are also costlier.
Crash, arrest draw more scrutiny of Tesla Autopilot system
LOS ANGELES (AP) — Federal safety regulators are sending a team to California to investigate a fatal freeway crash involving a Tesla, just after authorities near Oakland arrested a man in another Tesla rolling down a freeway with no one behind the steering wheel. Experts say both cases raise pressure on the National Highway Traffic Safety Administration to take action on Tesla’s partially automated driving system called Autopilot, which has been involved in multiple crashes that have resulted in at least three U.S. deaths. The probe of the May 5 crash in Fontana, California, east of Los Angeles, is the 29th case involving a Tesla that the agency has responded to. Messages were left Wednesday seeking comment from Tesla.
US budget deficit hits record $1.9 trillion so far this year
WASHINGTON (AP) — The U.S. budget deficit surged to a record of $1.9 trillion for the first seven months of this budget year. The yawning shortfall is due to the billions of dollars being spent in coronavirus relief packages. The Treasury Department said Wednesday in its monthly budget report that the deficit so far this year is 30.3% higher than the $1.48 trillion deficit run up over the same period a year ago. The deficits in both years showed the impact of the pandemic, as the government began approving trillions of dollars in relief to cover three rounds of individual payments, extra unemployment benefits and support for small businesses.
The S&P 500 fell 89.06 points, or 2.1%, to 4,063.04. The Dow Jones Industrial Average fell 681.50, or 2%, to 33,587.66. The Nasdaq fell 357.75 points, or 2.7%, to 13,031.68. The Russell 2000 index of smaller companies fell 71.85 points, or 3.3%, to 2,135.14.