Wall Street falters after mixed earnings reports
NEW YORK Wall Street fell on October 18 after rising Treasury yields tightened pressure on the stock market and major US companies issued a series of mixed profit reports. Worries about war in the Middle East also pulled the market down.
The S&P 500 index fell 1.3% on Wednesday. The Dow Jones Industrial Average fell 1% and the Nasdaq composite lost 1.6%.
Crude oil prices rose sharply overnight after a deadly explosion at a hospital in the Gaza Strip sparked protests across the Middle East. Meanwhile, gold rose as investors continued to seek safer investments following the surprise attack on Israel by Hamas on October 7.
United Airlines fell after showing how profits could be hit by rising fuel prices and the suspension of flights to Tel Aviv.
Morgan Stanley also declined despite reporting larger profits than forecast. Investors focused on weaker-than-expected results in the company’s asset management business.
On the winning side is Procter & Gamble, the giant behind Charmin, Febreze and Oral-B. It rose after reporting stronger-than-expected profits.
Work-sponsored health plan costs increase
NEW YORK The cost of health insurance through employment has skyrocketed this year, partly due to inflation, according to a survey of U.S. employers.
Premiums for both family and single plans rose 7% after barely rising in 2022, according to an Oct. 18 report by KFF, a nonprofit that researches health care issues. .Later this fall, employers begin the annual insurance enrollment period for 2024, and experts predict there could be more price increases.
Employer-sponsored health insurance is the most common form of insurance in the United States. KFF says nearly 153 million Americans have the disease. Companies often pay the majority of premiums by 70% or more in many cases.
That could lessen the impact of price increases on employees. Insurance costs are also deducted from pre-tax wages, helping to alleviate the financial hardship workers may feel.
KFF notes that premiums increase sharply with wages and inflation.
Tesla’s profits dropped 44% due to price cuts
LOS ANGELES Tesla’s net income fell in the third quarter from a year earlier, as price cuts helped fuel strong sales growth but also ate into the automaker’s profit margins
The maker of electric vehicles, solar panels and batteries on Wednesday reported net income of $1.85 billion for the July-September quarter, down 44% from a year earlier. Revenue increased 9% to $23.35 billion, below forecasts of $24.19 billion.
Earlier this month, Tesla reported selling 435,059 vehicles between July and September, a 27% increase. Even so, deliveries were still lower than the 461,000 analysts had predicted.
Tesla has been cutting prices most of this year to continue attracting buyers who now have more electric vehicle options. Discounts range from $4,400 to $20,000.
China’s economy grows slower than 4.9%
HONG KONG China’s economy slowed over the summer as global demand for the country’s exports faltered and its ailing real estate sector sank deeper into crisis.
The government said on October 18 that the economy expanded at an annual rate of 4.9% between July and September, beating forecasts of about 4.5%. But this was much slower than the previous quarter’s 6.3% annual growth rate.
The Chinese government has issued policy support measures to support the economy, including increasing spending on ports and other infrastructure, cutting interest rates and easing home-buying restrictions. Trade data released last week showed that exports and imports continued to decline in September, although at a slower rate than the previous month.
China is South Carolina’s largest global trading partner.
Amazon tests drones that deliver medicine
NEW YORK Amazon will soon have prescription drugs falling from the sky as the e-commerce giant becomes the latest company to test drone deliveries.
The company said on October 18 that customers in College Station, Texas can now have prescriptions delivered by drone within an hour of ordering. The drone is programmed to fly from the delivery center to the secure pharmacy. It will travel to the customer’s address, descend to a height of about four meters _ or 13 feet _ and drop a padded package. Other companies that have tested prescription drone deliveries include CVS Health.
Ga solar power plant. opened amid industry anxiety
ATLANTA A Korean company has begun production at a giant solar panel factory in Georgia.
Qcells’ move comes even as industry leaders said a surge in Asian imports could dampen efforts to produce more solar components in the US
The company, owned by South Korea’s Hanwha, said it is now manufacturing panels at an expanded two-factory complex in northwest Georgia. Industry figures show that Qcells facilities account for about 40% of US solar panel capacity.
Musk’s X tests a $1 fee for some new users
LONDON Elon Musk’s social media platform X has started charging $1 for new users in the Philippines and New Zealand. This is an experiment designed to reduce spam and fake accounts that are rampant on the platform formerly known as Twitter.
The company said late on October 17 that it had begun testing an annual subscription method for new and unverified accounts. The program called Not a Bot will not apply to existing users. It’s unclear why it only applies to New Zealand and the Philippines or why those countries were chosen. The company said this was “not a profit driver”.
UK inflation unchanged at 6.7%
LONDON UK inflation held steady at 6.7% in September as lower food and drink prices were offset by higher fuel costs for motorists.
The flat data reported by the Office for National Statistics on October 18 came as a surprise. Most economists had predicted another decline. That means the UK’s inflation rate is still more than three times higher than the Bank of England’s 2% target rate.
However, the bank is not expected to raise interest rates at its next policy meeting, instead opting to keep its key borrowing rate unchanged at a 15-year high of 5.25%. Last month, the bank ended nearly two years of interest rate hikes as inflation eased from a multi-decade high of above 11%.
Europe aims to stop the wave of Chinese electric vehicles
LONDON Chinese carmakers are winning over motorists as they make inroads into Europe’s electric vehicle market. They are challenging established homegrown brands in an industry that plays a key role in Europe’s green energy transition.
The threat of competition has prompted the European Union to open an investigation into Beijing’s support for the country’s electric vehicle industry. That adds to tech-related tensions between the West and China.
Europe is attractive for Chinese electric vehicles because car import taxes are much lower than in the US. One in five electric vehicles sold in Europe are Chinese imports, including cars that global automakers such as Tesla and BMW produce in China.
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