Wed, April 24, 2024 at 9:35 AM EDT
Business
Dow Futures Sink After Senate Approves Trump’s Coronavirus Stimulus Bill – CCN.com
- Dow Jones futures were off by as much as 252 points Wednesday night.
- The Dow Jones index rallied in New York trading, capping off its first two-day winning streak since February.
- Despite some Republican opposition, the Senate voted to pass the Trump administration’s $2 trillion stimulus package late Wednesday.
Futures on the Dow and broader U.S. stock market tumbled in overnight trading Wednesday, as investors continued to dissect the Trump administration’s $2 trillion stimulus response to coronavirus.
Dow, U.S. Stock Futures Slide
Futures on all three major U.S. indexes declined in overnight trading, with the Dow Jones Industrial Average mini contract falling by as much as 252 points, or 1%. It would eventually reverse most of those losses and was last seen trading 0.4% lower.
S&P 500 futures were down 0.2%. Nasdaq futures also tumbled 0.2%.
The Dow and S&P 500 finished sharply higher in New York trading, marking their first back-to-back gains since February. Over those two days, the Dow climbed more than 2,600 points.
Senate Passes Stimulus Bill
The Senate has finally approved a proposed $2 trillion stimulus package designed to ease the economic burden brought on by the Covid-19 pandemic. The landmark legislation was passed just minutes before midnight.
House Majority Leader Steny Hoyer says the bill will move to the House on Friday.
The legislation aims to provide direct financial support to Americans whose employment has been directly impacted by coronavirus. It will also unlock hundreds of billions in loans to small and large enterprises.
As The Wall Street Journal reports, lawmakers were expected to vote on the bill Wednesday night but,
the procedure was delayed when rank-and-file members voiced objections…
Vermont Senator Bernie Sanders was among those who rejected the bill and even threatened to block its passage if major revisions weren’t made.
Some Republicans criticized the proposed legislation and at least four objected to it because it disincentivizes going back to work.
Despite these criticisms, a former member of the Trump administration believes $2 trillion might not be enough to avert economic catastrophe.
Gary Cohn, who once served as President Trump’s top aide, told CNBC on Wednesday that “you cannot overreact in this situation.”
Basically, Cohn believes Congress must “throw as much money as you can at the situation.”
Of course, Cohn didn’t address the long-term impact of running massive deficits and the need to perpetually borrow money to fund lucrative programs.
The Federal Reserve is also fueling American debt by keeping interest rates artificially lower. Several pockets of the U.S. economy and financial system are highly leveraged, raising the specter of a painful recession if and when those bubbles pop.
Corporate debt is one such bubble, and is now valued at more than 46% of gross domestic product. The last time corporate debt-to-GDP was this high was in the run-up to the 2008 financial crisis.
This article was edited by Josiah Wilmoth.
Last modified: March 26, 2020 4:03 AM UTC
Continue Reading
Business
Oil Firms Doubtful Trans Mountain Pipeline Will Start Full Service by May 1st
|
Oil companies planning to ship crude on the expanded Trans Mountain pipeline in Canada are concerned that the project may not begin full service on May 1 but they would be nevertheless obligated to pay tolls from that date.
In a letter to the Canada Energy Regulator (CER), Suncor Energy and other shippers including BP and Marathon Petroleum have expressed doubts that Trans Mountain will start full service on May 1, as previously communicated, Reuters reports.
Trans Mountain Corporation, the government-owned entity that completed the pipeline construction, told Reuters in an email that line fill on the expanded pipeline would be completed in early May.
After a series of delays, cost overruns, and legal challenges, the expanded Trans Mountain oil pipeline will open for business on May 1, the company said early this month.
“The Commencement Date for commercial operation of the expanded system will be May 1, 2024. Trans Mountain anticipates providing service for all contracted volumes in the month of May,” Trans Mountain Corporation said in early April.
The expanded pipeline will triple the capacity of the original pipeline to 890,000 barrels per day (bpd) from 300,000 bpd to carry crude from Alberta’s oil sands to British Columbia on the Pacific Coast.
The Federal Government of Canada bought the Trans Mountain Pipeline Expansion (TMX) from Kinder Morgan back in 2018, together with related pipeline and terminal assets. That cost the federal government $3.3 billion (C$4.5 billion) at the time. Since then, the costs for the expansion of the pipeline have quadrupled to nearly $23 billion (C$30.9 billion).
The expansion project has faced continuous delays over the years. In one of the latest roadblocks in December, the Canadian regulator denied a variance request from the project developer to move a small section of the pipeline due to challenging drilling conditions.
The company asked the regulator to reconsider its decision, and received on January 12 a conditional approval, avoiding what could have been another two-year delay to start-up.
Business
Tesla profits cut in half as demand falls
|
Tesla profits slump by more than a half
Tesla has announced its profits fell sharply in the first three months of the year to $1.13bn (£910m), compared with $2.51bn in 2023.
It caps a difficult period for the electric vehicle (EV) maker, which – faced with falling sales – has announced thousands of job cuts.
Boss Elon Musk remains bullish about its prospects, telling investors the launch of new models would be brought forward.
Its share price has risen but analysts say it continues to face significant challenges, including from lower-cost rivals.
The company has suffered from falling demand and competition from cheaper Chinese imports which has led its stock price to collapse by 43% over 2024.
Figures for the first quarter of 2024 revealed revenues of $21.3bn, down on analysts’ predictions of just over $22bn.
But the decision by Tesla to bring forward the launch of new models from the second half of 2025 boosted its shares by nearly 12.5% in after-hours trading.
It did not reveal pricing details for the new vehicles.
However Mr Musk made clear he also grander ambitions, touting Tesla’s AI credentials and plans for self-driving vehicles – even going as far as to say considering it to be just a car company was the “wrong framework.”
“If somebody doesn’t believe Tesla is going to solve autonomy I think they should not be an investor,” he said.
Such sentiments have been questioned by analysts though, with Deutsche Bank saying driverless cars face “technological, regulatory and operational challenges.”
Some investors have called for the company to instead focus on releasing a lower price, mass-market EV.
However, Tesla has already been on a charm offensive, trying to win over new customers by dropping its prices in a series of markets in the face of falling sales.
It also said its situation was not unique.
“Global EV sales continue to be under pressure as many carmakers prioritize hybrids over EVs,” it said.
Despite plans to bring forward new models originally planned for next year the firm is cutting its workforce.
Tesla said it would lose 3,332 jobs in California and 2,688 positions in Texas, starting mid-June.
The cuts in Texas represent 12% of Tesla’s total workforce of almost 23,000 in the area where its gigafactory and headquarters are located.
However, Mr Musk sought to downplay the move.
“Tesla has now created over 30,000 manufacturing jobs in California!” he said in a post on his social media platform X, formerly Twitter, on Tuesday.
Another 285 jobs will be lost in New York.
Tesla’s total workforce stood at more than 140,000 late last year, up from around 100,000 at the end of 2021, according to the company’s filings with US regulators.
Musk’s salary
The car firm is also facing other issues, with a struggle over Mr Musk’s compensation still raging on.
On Wednesday, Tesla asked shareholders to vote for a proposal to accept Mr Musk’s compensation package – once valued at $56bn – which had been rejected by a Delaware judge.
The judge found Tesla’s directors had breached their fiduciary duty to the firm by awarding Mr Musk the pay-out.
Due to the fall in Tesla’s stock value, the compensation package is now estimated to be around $10bn less – but still greater than the GDP of many countries.
In addition, Tesla wants its shareholders to agree to the firm being moved from Delaware to Texas – which Mr Musk called for after the judge rejected his payday.
Business
Stock market today: Nasdaq futures pop, Tesla surges after earnings with more heavyweights on deck
|
Tech stocks rose on Wednesday, outstripping the broader market as investors welcomed Tesla’s (TSLA) cheaper car pledge and waited for the next rush of corporate earnings.
The Nasdaq Composite (^IXIC) rose roughly 0.6%, coming off a sharp closing gain. The S&P 500 (^GSPC) was up 0.2%, continuing a rebound from its longest losing streak of 2024, while the Dow Jones Industrial Average (^DJI) fell 0.1%.
Tesla shares jumped nearly 12% after the EV maker’s vow to speed up the launch of more affordable models eclipsed its quarterly earnings and revenue miss. That cheered up investors worried about growth amid a strategy shift to robotaxis and the planned cancellation of a cheaper model.
The results from the first “Magnificent Seven” to report have intensified the already high hopes for Big Tech earnings, that the megacaps can revive the rally in stocks they powered. The spotlight is now on Meta’s (META) report due after the market close, as the Facebook owner’s shares rose after the Senate voted for a potential ban on rival TikTok. Microsoft (MSFT) and Alphabet (GOOG) next up on Thursday.
Meanwhile, Boeing (BA) reported better than expected first quarter results before the opening bell with a loss per share of $1.13, narrower than the $1.72 estimated by Wall Street. Shares rose about 2% in morning trade.
Live6 updates
-
Health19 hours ago
Remnants of bird flu virus found in pasteurized milk, FDA says
-
Health23 hours ago
Bird flu virus found in grocery milk as officials say supply still safe
-
News16 hours ago
Amid concerns over ‘collateral damage’ Trudeau, Freeland defend capital gains tax change
-
Investment24 hours ago
Taxes should not wag the tail of the investment dog, but that’s what Trudeau wants
-
Art20 hours ago
Random: We’re In Awe of Metaphor: ReFantazio’s Box Art
-
News24 hours ago
Peel police chief met Sri Lankan officer a court says ‘participated’ in torture – Global News
-
Art13 hours ago
The unmissable events taking place during London’s Digital Art Week
-
Media19 hours ago
Vaughn Palmer: B.C. premier gives social media giants another chance