Financial News

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August 18, 2022
Friday, August 19th
August 19, 2022
Financial News

Bed Bath & Beyond tumbles after influential investor exits

NEW YORK (AP) — The newest meme stock on Wall Street, Bed Bath & Beyond, has tumbled even further in after-hours trading after a high-profile activist investor confirmed that he’s bailed out of the stock. Ryan Cohen, the co-founder of Chewy who helped ignite a couple meme stocks, confirmed in a filing with U.S. regulators that he no longer owns any shares or options related to the stock. The move disappointed hordes of smaller-pocketed investors, who piled into the stock amid hopes it could soar like GameStop shares did last year. Bed Bath & Beyond’s stock dropped 42% in after-hours trading Thursday, after a nearly 20% dive during the regular session

 

Apple warns of security flaw for iPhones, iPads and Macs

SAN FRANCISCO (AP) — Apple has disclosed serious security vulnerabilities for iPhones, iPads and Macs. The software flaws could potentially allow attackers to take complete control of these devices, Apple said Wednesday. The company said in a security statement that it is “aware of a report that this issue may have been actively exploited.” Security experts have advised users to update affected devices — the iPhone6S and later models, newer iPads and Mac computers running MacOS Monterey. It also affects some iPod models. Commercial spyware companies are known for using such flaws in products designed to introduce malware and siphon data from targeted phones and other devices.

 

Stocks fall broadly, S&P 500 set to break winning streak

NEW YORK (AP) — Stocks fell on Wall Street, putting the S&P 500 index on track to break a four-week winning streak. The benchmark index was off 1.3% in afternoon trading on Friday. The Nasdaq was down even more as technology stocks had some of the biggest losses. The Dow Jones Industrial Average was also lower. Meme stock Bed Bath & Beyond sank nearly 40% after the high-profile activist investor Ryan Cohen confirmed that he’s bailed out of the stock. General Motors rose after reinstating its dividend, and Foot Locker soared after replacing its CEO and reporting earnings that beat Wall Street’s estimates.

 

Foot Locker names former Ulta Beauty chief as CEO

SILVER SPRING, Md. (AP) — Foot Locker is naming former Ulta Beauty CEO Mary Dillon as its chief executive, replacing Richard Johnson, who will retire next month after leading the athletic retailer since 2014. Dillon will take over the top position at Foot Locker effective September 1. Dillon led beauty retailer Ulta Beauty from 2013 to 2021 as it doubled its number of stores and loyalty memberships. She also served as president and CEO of U.S. Cellular and held executive and leadership positions at McDonald’s and PepsiCo. Foot Locker also reported second-quarter profit that beat analysts’ expectations, sending shares up more than 21% in morning trading.

 

Zimbabweans hit by 257% inflation: Will gold coins help?

HARARE, Zimbabwe (AP) — Rising prices and a fast depreciating currency have pushed many in Zimbabwe to the brink, reminding people of when the southern African country faced world-record inflation of 5 billion% in 2008. With inflation jumping from 191% in June to 257% in July, many Zimbabweans fear the country is heading back to hyperinflation. To prevent a return of such economic disaster, President Emmerson Mnangagwa’s government last month introduced gold coins as legal tender. The country’s central bank, the Reserve Bank of Zimbabwe, said the one-ounce, 22-carat coins would help tame runaway inflation and stabilize the nation’s currency. But the glitter of the gold coins is hard to see for Zimbabweans struggling each day to eke out a living.

 

Doctors stay in Ukraine’s war-hit towns: ‘People need us’

ZOLOCHIV, Ukraine (AP) — Ukraine’s health care system already was struggling due to corruption, mismanagement and the COVID-19 pandemic. But the war with Russia has only made things worse, with facilities damaged or destroyed, medical staff relocating to safer places and many drugs unavailable or in short supply. Care is being provided in the hardest-hit areas by doctors who have refused to evacuate or have rushed in as volunteers, putting themselves at great risk. The district hospital in the northeastern town of Zolochiv near the Russian border doesn’t have a single building that has escaped artillery damage. The staff has dwindled from 120 to just 47, but the facility’s administrator says they stay because “people need us.”

 

Yangtze shrinks as China’s drought disrupts industry

CHONGQING, China (AP) — Ships are creeping down the middle of the Yangtze after China’s driest summer in six decades left one of the mightiest rivers barely half its normal width. The drought has set off a scramble to contain damage to a weak economy in a politically sensitive year. Factories in Sichuan province and the adjacent metropolis of Chongqing in the southwest were ordered to shut down after reservoirs that supply hydropower fell to half their typical levels and demand for air conditioning surged in scorching temperatures. River ferries in Chongqing that usually are packed with sightseers were empty and tied to piers beside mudflats that stretched down to the depleted river’s edge.

 

Stars Coffee, anyone? Starbucks successor opening in Russia

MOSCOW (AP) — Russian fans of Starbucks coffee shops are getting the chance to see if a homegrown successor can measure up. After the U.S. company left Russia in the wake of Russia’s military operation in Ukraine, entrepreneurs who bought the assets are opening shops in former Starbucks locations this week. They have the nearly identical name of Stars Coffee and a logo almost indistinguishable from its predecessor’s. The venture follows the strategy of reviving closed McDonald’s outlets under a new name but with fundamentally the same menu. Russian entrepreneurs saw opportunity in suddenly unoccupied stores after Western companies exited the country.

 

China jails Canadian tycoon for 13 years for finance crimes

BEIJING (AP) — A court says Chinese-born Canadian tycoon who disappeared from Hong Kong in 2017 has been sentenced to 13 years in prison for a multibillion-dollar string of financial offenses and his company was fined $8.1 billion. The court in Shanghai says Xiao Jianhua was convicted of misusing billions of dollars of deposits from banks and insurers controlled by his Tomorrow Group and offering bribes to officials. Xiao was fined the equivalent of $950,000. He was last seen at a Hong Kong hotel in January 2017 and was believed to have been taken to the mainland by Chinese authorities.

 

2 Russian villages evacuated after fire at munitions depot

KYIV, Ukraine (AP) — The governor of Russia’s Belgorod region says a fire at a munitions depot near the Russian village of Timonovo has led to the evacuation of two villages in Russia’s Belgorod region on Ukraine’s northeastern border. The governor said Friday there were no casualties in the late Thursday blaze. The fire came days after another ammunition depot exploded on Ukraine’s Black Sea peninsula of Crimea. The Russian-occupied territory was seized by Moscow in 2014. Nine Russian warplanes were reported destroyed last week at an airbase on Crimea. It demonstrated both the Russians’ vulnerability and the Ukrainians’ capacity to strike deep behind enemy lines.

 

US home sales fell in July; some buyers see silver lining

LOS ANGELES (AP) — The housing market’s comedown from its high-flying days early this year is deepening, with home sales in July falling for the sixth straight month. Sharply higher mortgage rates, surging inflation and prices that remain near all-time highs are making homes less affordable. The National Association of Realtors said Thursday that sales fell 20.2% from July last year, reaching the slowest pace since May 2020, near the start of the pandemic. But the slowdown has begun to tip the homebuying equation, if ever so slightly, in favor of house hunters who can afford to stay in the market and away from sellers.

 

Bed Bath & Beyond tumbles after influential investor exits

NEW YORK (AP) — The newest meme stock on Wall Street, Bed Bath & Beyond, has tumbled even further in after-hours trading after a high-profile activist investor confirmed that he’s bailed out of the stock. Ryan Cohen, the co-founder of Chewy who helped ignite a couple meme stocks, confirmed in a filing with U.S. regulators that he no longer owns any shares or options related to the stock. The move disappointed hordes of smaller-pocketed investors, who piled into the stock amid hopes it could soar like GameStop shares did last year. Bed Bath & Beyond’s stock dropped 42% in after-hours trading Thursday, after a nearly 20% dive during the regular session

 

Fewer Americans file for jobless benefits last week

WASHINGTON (AP) — Slightly fewer Americans filed for unemployment benefits last week as the labor market continues to be the strongest segment of the U.S. economy. Applications for jobless aid for the week ending August 13 fell by 2,000 to 250,000, the Labor Department reported Thursday. Last week’s number, which raised some eyebrows, was revised down by 10,000. The four-week average for claims, which evens out some of the week-to-week volatility, fell by 2,750 to 246,750. Unemployment applications generally reflect layoffs and are often seen as an early indicator of where the job market is headed.

 

Disqualified for disabilities, railroad workers fight back

OMAHA, Neb. (AP) — Union Pacific has already lost three lawsuits over the way it removes employees with health conditions because of safety concerns, and the prospect of hundreds more lawsuits looms over the railroad. The lawsuits were originally going to be part of a class-action case before a federal appeals court decided the cases must be pursued individually. The first few lawsuits have now been tried with verdicts over $1 million coming in all three cases, but more than 200 more discrimination complaints are still pending with the Equal Employment Opportunity Commission that are likely to turn into lawsuits. Union Pacific has vigorously defended its policy in court, and the railroad says it is designed to protect its workers and the public from significant injury risks.

 

Apple warns of security flaw for iPhones, iPads and Macs

SAN FRANCISCO (AP) — Apple has disclosed serious security vulnerabilities for iPhones, iPads and Macs. The software flaws could potentially allow attackers to take complete control of these devices, Apple said Wednesday. The company said in a security statement that it is “aware of a report that this issue may have been actively exploited.” Security experts have advised users to update affected devices — the iPhone6S and later models, newer iPads and Mac computers running MacOS Monterey. It also affects some iPod models. Commercial spyware companies are known for using such flaws in products designed to introduce malware and siphon data from targeted phones and other devices.

 

Stars Coffee, anyone? Starbucks successor opening in Russia

MOSCOW (AP) — Russian fans of Starbucks coffee shops are getting the chance to see if a homegrown successor can measure up. After the U.S. company left Russia in the wake of Russia’s military operation in Ukraine, entrepreneurs who bought the assets are opening shops in former Starbucks locations this week. They have the nearly identical name of Stars Coffee and a logo almost indistinguishable from its predecessor’s. The venture follows the strategy of reviving closed McDonald’s outlets under a new name but with fundamentally the same menu. Russian entrepreneurs saw opportunity in suddenly unoccupied stores after Western companies exited the country.

 

Unions push airlines to promise they’ll avoid stock buybacks

DALLAS (AP) — Labor unions are pushing U.S. airlines not to buy back their own stock. The unions want the airlines to spend money instead on hiring more workers and fixing problems that are causing widespread flight delays and cancellations. The unions said Thursday that the four largest U.S. airlines spent more than $39 billion on stock buybacks from 2014 through 2019 rather than making investments to help employees and passengers. American, United and Southwest say they have no plans to buy back stock when a prohibition against buybacks ends Sept. 30.

 

Kohl’s cuts 2022 outlook, capping mixed week for retailers

Kohl’s has slashed its sales and profit expectations for the year as a result of the department store chain stepping up discounts to get rid of unwanted merchandise. Looking ahead, Kohl’s said it was reducing merchandise orders for the critical holiday period. The announcement Thursday sent Wisconsin-based Kohl’s shares down almost 8% and capped a mixed week for retailers. Kohl’s disappointing forecast is the latest indication shoppers are cutting back on clothing and other discretionary items in the face of high inflation. They’re also shifting spending priorities as they emerge from the pandemic.

 

Stocks end higher on Wall Street after more choppy trading

Stocks ended modestly higher on Wall Street after another day of choppy trading. The S&P 500 rose 0.2% Thursday, putting it just barely back into the green for the week. The Dow Jones Industrial Average ended a touch higher. The Nasdaq also rose as technology companies gained ground. Cisco Systems rose after turning in stronger-than-expected quarterly results. Energy companies also climbed along with rising crude oil prices. The yield on the 10-year Treasury fell to 2.87%. The U.S. government reported that slightly fewer Americans filed for unemployment benefits last week as the labor market remains strong.

 

Starbucks must reinstate fired workers, federal judge rules

MEMPHIS, Tenn. (AP) — A federal judge is ordering Starbucks to reinstate seven employees in Memphis, Tennessee, who were fired earlier this year after leading an effort to unionize their store. In a decision issued Thursday, U.S. District Judge Sheryl Lipman agreed with the National Labor Relations Board, which had asked the court to intervene in May. Lipman’s decision requires Starbucks to offer reinstatement to the employees within five days. The case has been among the most closely watched in the unionization effort at Starbucks. More than 220 U.S. Starbucks stores, including the Memphis store, have voted to unionize. Starbucks opposes the unionization effort.