Powell says inflation, though elevated, will likely moderate
WASHINGTON (AP) — Federal Reserve Chair Jerome Powell suggested Wednesday that inflation, which has been surging as the recovery strengthens, “will likely remain elevated in coming months” before “moderating.” At the same time, Powell signaled no imminent change in the Fed’s ultra-low-interest rate policies. In testimony before the House Financial Services Committee, Powell reiterated his long-held view that high inflation readings over the past several months have been driven largely by temporary factors, notably supply shortages and rising consumer demand as pandemic-related business restrictions are lifted.
Wholesale inflation over past year jumps by record amount
WASHINGTON (AP) — Inflation at the wholesale level jumped 1% in June, pushing price gains over the past 12 months up by a record 7.3%. The Labor Department reported Wednesday that the June increase in its producer price index, which measures inflation pressures before they reach consumers, followed a gain of 0.8% in May and was the largest one-month increase since January. For the 12 months ending in June, wholesale prices are up 7.3%, the largest increase since the government began the current series on wholesale prices in 2010.
Bank of America’s 2Q profit jumps, helped by fewer bad loans
NEW YORK (AP) — Bank of America’s second quarter profit more than doubled from a year earlier, as the consumer banking giant was able to move more loans onto the “good” side of its balance sheet as the pandemic wanes. The Charlotte-based bank said it earned $9.22 billion in the last three months, or $1.03 per share. That up from a profit of $3.53 billion, or 38 cents per share, from the same period a year earlier. The results were better than the 77-cent-per-share profit that analysts had forecasted, according to FactSet.
Well, that was brief: Twitter kills off ephemeral ‘fleets’
SAN FRANCISCO (AP) — Twitter is disappearing its disappearing tweets, called fleets, after they didn’t catch on. The company began testing tweets that vanish after 24 hours last March in Brazil. Fleets were designed to allay the concerns of new users who might be turned off by the public and permanent nature of normal tweets. But that didn’t happen, so Twitter says it is moving on to other things. Testing and winding down new features is common at Twitter and other tech companies. Fleets are reminiscent of Instagram and Facebook “stories” and Snapchat’s snaps, which let users post short-lived photos and messages.
Facebook asks recusal of FTC head in antitrust case decision
WASHINGTON (AP) — Facebook is asking that the new head of the Federal Trade Commission step away from decisions on whether to continue the agency’s antitrust case against the social network giant. The company is asserting that past public criticism of the company’s market power makes it impossible for FTC Chair Lina Khan to be impartial. Facebook petitioned the agency to remove Khan from taking part in decisions on the FTC’s antitrust lawsuit against the company. A federal judge recently dismissed the suit by the FTC. But the judge allowed the FTC to revise its complaint and try again. Khan has been a persistent critic of Amazon, Google and Apple, as well as Facebook.
Fed survey: US economy strong but hindered by bottlenecks
WASHINGTON (AP) — The Federal Reserve’s latest nationwide business survey has found that the economy strengthened further in late May and early June, despite supply-chain bottlenecks that led to price hikes. The Fed said Wednesday that seven of its 12 regional bank districts reported strong price increases, with the other five reporting moderate gains in prices. This came as sectors of the economy dealing with transportation, travel and tourism, and manufacturing all experienced above-average economic growth in the period, the Fed reported. But the survey also found that the supply-chain disruptions led to shortages of materials and labor, along with low inventories, constrained sales of many consumer goods.
Stocks end a wobbly day mixed and just shy of record highs
NEW YORK (AP) — Stocks ended a wobbly day on Wall Street with mixed results Wednesday as investors weighed the latest corporate earning reports and the Federal Reserve chair’s comments on inflation. Technology companies made broad gains, while banks were mostly weaker after several of them reported their quarterly results. American Airlines rose after giving investors a strong outlook. Energy companies had some of the biggest losses, partly due to a drop in the price of benchmark U.S. crude oil. The yield on the 10-year Treasury note fell to 1.34%. Federal Reserve Chair Jerome Powell reaffirmed the central bank’s position that inflation will eventually ease.
Citigroup profits soar due to fewer bad loans
NEW YORK (AP) — Citigroup profits jumped more than five fold from a year earlier, helped by an improving economy that resulted in fewer bad loans on the bank’s balance sheet. The New York-based bank said it earned $6.19 billion, or $2.85 a share. That’s up from a profit of $1.06 billion, or 38 cents a share, in the same period a year earlier. The results were significantly better than the $1.97-per-share profit that analysts had expected, according to FactSet. Citi was able to to release $2.4 billion from its loan-loss reserves, giving a boost to the bottom line.
The S&P 500 rose 5.09 points, or 0.1%, to 4,374.30. The Dow Jones Industrial Average gained 44.44 points, or 0.1%, to 34,933.23. The Nasdaq fell 32.70 points, or 0.2%, to 14,644.95. The Russell 2000 index of smaller companies dropped 36.51 points, or 1.6%, to 2,202.36.