Business News

US economic growth increased last quarter to a healthy 2.8% annual rate

WASHINGTON (AP) — The nation’s economy accelerated last quarter at a strong 2.8% annual pace, with consumers and businesses helping drive growth despite the pressure of continually high interest rates. The gross domestic product picked up in the April-June quarter after growing at a 1.4% pace in the January-March period. Economists had expected a weaker 1.9% annual pace of growth. The GDP report also showed that inflation continues to ease, though still remaining above the Federal Reserve’s 2% target. The latest figures should reinforce confidence that the U.S. economy is on the verge of achieving a rare “soft landing,” whereby high interest rates, engineered by the Fed, tame inflation without tipping the economy into a recession.

Southwest Airlines plans to start assigning seats, breaking with a 50-year tradition

DALLAS (AP) — Southwest Airlines plans to drop the open-boarding system it has used for more than 50 years and will start assigning passengers to seats, just like all the other big airlines. The airline said on Thursday that preferences have changed over the years and the vast majority of travelers now want to know where they are sitting before they get to the airport. Southwest’s unusual boarding process started as a fast way to load passengers and limit the time that planes and crews spend sitting idly on the ground, not making money. It helped the airline squeeze a few more flights into the daily schedule. Southwest also plans to offer redeye flights for the first time.

Stock market today: Wall Street gains ground following its sell-off as tech, smaller stocks rise up

NEW YORK (AP) — U.S. stocks are rising, a day after their worst losses since 2022 led to a wipeout for financial markets around the world. The S&P 500 rose 0.9% Thursday after a surprisingly strong report on the U.S. economy raised hopes for stronger profits at smaller stocks and other formerly unloved areas of the market. The Dow Jones Industrial Average climbed 468 points, or 1.2%, and the Nasdaq composite rose 0.9% higher. Many Big Tech stocks also gained ground, a day after profit reports from Tesla and Alphabet underwhelmed and raised concerns that investors’ frenzy around artificial-intelligence technology had sent stock prices too high.

Carmaker Stellantis pledges to tackle problems in North America as profits plunge

MILAN (AP) — Stellantis CEO Carlos Tavares pledged action to tackle problems in North America and elsewhere after reporting a plunge in first-half earnings. Net profits at the U.S.-European automaker were down by half in the first six months of the year, due largely to lower sales and restructuring costs. The carmaker, which was created in 2021 from the merger of Fiat-Chrysler with PSA Peugeot, reported net profits of just over 6 billion dollars in the period, compared with slightly under 12 billion dollars in the same period last year. Tavares singled out North America as a place where there is “significant work to do,” citing issues with inventory management and sliding market share.

Ford shares slide as disappointing Q2 adjusted profit rattles investors

Shares of Ford Motor Co. are tumbling Thursday after the automaker’s second-quarter adjusted profit badly missed Wall Street’s expectations as it spent more money fixing customers’ cars and trucks. On Wednesday Ford posted an adjusted profit of 47 cents per share. That was far short of industry analysts’ estimates of 68 cents, according to FactSet. Warranty costs have vexed the nation’s second-largest automaker for several years and lopped billions off of its profits. In the second quarter, warranty and recall costs totaled $2.3 billion, $800 million more than the first quarter and $700 million more than a year ago.

Meta’s Oversight Board says deepfake policies need update and response to explicit image fell short

LONDON (AP) — Meta’s Oversight Board says the company failed to take down an AI-generated intimate image of an Indian female public figure that violated its policies until the board got involved. The quasi-independent board also said the social media giant’s policies on non-consensual deepfake images needs updating, including wording that’s “not sufficiently clear.” Deepake nude images of women and celebrities including Taylor Swift have proliferated on social media because the technology used to make them has become more accessible and easier to use. Online platforms have been facing pressure to do more to tackle the problem. Meta said it welcomed the board’s recommendations and is reviewing them.

Future of undersea electricity cable linking Greece, Cyprus and Israel will be decided next month

NICOSIA, Cyprus (AP) — Cyprus’ energy minister says the future of an electricity cable linking the power grids of Greece, Cyprus and Israel will be settled next month. That’s when the Cypriot energy regulator is due to rule on whether to accept the terms of the project’s Greek operator, which wants Cypriot consumers to pick up the tab for the cable’s four-year construction costs. Officials have said the 2-billion-dollar cable, known as the Great Sea Interconnector, would end the energy isolation of both the east Mediterranean island nation and Israel, while promising consumers cheaper energy. The European Union is partly financing the project with 713 million dollars.

Workers go on strike at five-star Paris hotel where IOC members are staying for Olympics

Workers have gone on strike at the five-star hotel in Paris where members of the International Olympic Committee are staying. According to the major French union CGT, the IOC paid the hotel where staffers were striking Thursday 22 million euros for exclusive use of the facility during the Games. The CGT says the employees were demanding a pay increase, having not received a raise for seven years. The protests come as tensions run high following recent legislative elections, putting France on the brink of a governing paralysis that’s sparked further calls for strikes.

Spicy dispute over the origins of Flamin’ Hot Cheetos winds up in court

A court case could soon settle a spicy dispute: Who invented Flamin’ Hot Cheetos? A former PepsiCo executive is suing the company in California, saying it destroyed his career after questioning his claim that he invented Flamin’ Hot Cheetos. According to his lawsuit, Richard Montanez began working for PepsiCo as a janitor at its Frito-Lay plant in California in 1977. He claims he began experimenting with chili powder on Cheetos in the early 1990s and helped convince the company to sell them. Montanez later became a marketing executive at PepsiCo. But he says the company eventually claimed that others had developed the hit product.

Small stocks are about to take over? Wall Street has heard that before.

NEW YORK (AP) — After getting trounced by their larger rivals for years, some of the smallest stocks on Wall Street have shown much more life recently. Hopes for coming cuts to interest rates have pushed investors to look at smaller stocks through a different lens, and they soared recently during a five-day winning streak. Investors pumped $9.9 billion into funds focused on small U.S. stocks last week, the largest amount since 2007. If that all sounds somewhat familiar, it should. Hope for a broadening out of the market swept Wall Street late last year. It ended up fizzling. Professional investors still aren’t convinced this time is different.