Stocks move mostly lower
NEW YORK (AP) — Stock indexes are mostly lower on Wall Street as traders turn cautious ahead of a policy announcement on interest rates later Wednesday from the Federal Reserve.
The S&P 500 was down 0.3% in midday trading. The index has staged a huge comeback since its late March low and is now within 6% of reclaiming the all-time high it reached in February, before the coronavirus lockdowns started happening.
Global markets were also mixed after the Organization for Economic Cooperation and Development said the coronavirus crisis has triggered the worst global recession in nearly a century.
Bond yields fell.
Consumer prices down for third month
WASHINGTON (AP) — U.S. consumer prices dropped in May for the third straight month as the coronavirus pandemic pushed the American economy into a recession.
The Labor Department said Wednesday that its consumer price index fell 0.1% last month after tumbling 0.8% in April and 0.4% in March. Excluding food and energy prices, which bounce around from month to month, so-called core inflation fell 0.1%, falling for the third consecutive month for the first time ever.
The pandemic and the quarantines meant to contain it pushed the U.S. economy into recession. Weaker demand from customers pushes prices down.
MALL DEAL SCRAPPED
Buyer's remorse: Mall deal implodes as virus shakes retail
NEW YORK (AP) — The nation's biggest mall owner is backing out of a $3.6 billion deal to buy a major rival as the coronavirus pandemic shakes the retail economy.
It is the second major retail deal signed just before the pandemic began to spread in the U.S. that has crumbled. Last month, a deal to sell Victoria’s Secret to a private equity group fell apart.
Simon Property Group said it would buy Taubman Centers in early February, just weeks before the CDC said a California patient was being treated for coronavirus, the first known case in the U.S.
The plunge in sales for retailers since then has been unprecedented, particularly for those with a heavy presence in malls. J.C. Penney, Neiman Marcus and J.Crew have all filed for bankruptcy protection this year.
Backlash over George Floyd tweet forces out CrossFit founder
UNDATED (AP) — The CEO of CrossFit is stepping down after his tweet about George Floyd sparked a social media backlash and led to affiliated gyms and Reebok cutting ties with the exercise brand.
Greg Glassman said in a statement late Tuesday that he decided to retire, saying he has created a rift in the CrossFit community and unintentionally hurt many of its members.
Glassman had apologized earlier for tweets that sparked online outrage by connecting Floyd and the coronavirus pandemic. He said he made a mistake and should have been more sensitive but denied being racist.
GM, Ford offer timetable for return to full production
UNDATED (AP) — General Motors is predicting that its U.S. factories will resume normal production by the end of June, perhaps sooner, while Ford expects to have its factories humming at pre-coronavirus levels by July 6.
Company executives made the predictions Wednesday at a Deutsche Bank autos conference.
GM Chief Financial Officer Dhivya Suryadevara said many factories were on two or three shifts of production already, and the company is working to fully ramp back up as quickly as possible.
Ford, GM and the rest of the U.S. auto industry closed factories in mid-March when employees started catching the coronavirus. Most reopened in May.
Ford Chief Operating Officer Jim Farley said the company hit 96% of its production targets in the first three weeks after it reopened factories on May 18.
Ford initially had trouble restarting in Chicago and Dearborn, Michigan, due to employees testing positive for the virus or due to parts shortages. But those have since subsided.
Ford, VW to collaborate on vans, pickup, electric vehicle
DEARBORN, Mich. (AP) — Ford and Volkswagen will work together to develop a small city van, a larger cargo van, a small pickup truck and an electric vehicle as part of their global alliance announced last year.
The companies on Wednesday announced some details of what the venture will yield, with the city van created by VW and a 1-ton cargo van engineered by Ford to be sold by both companies.
Also, VW will make a small pickup built on the underpinnings of Ford’s Ranger, and Ford will build an electric vehicle for Europe based on VW’s modular design, the companies said.
The automakers announced the alliance last July amid a string of industry partnerships designed to share the costs of developing new technologies.
Starbucks takes $3 billion hit to revenue during pandemic
UNDATED (AP) — Starbucks expects to lose more than $3 billion in revenue in its fiscal third quarter due to the new coronavirus.
The Seattle-based coffee giant says the virus outbreak will also slash its operating income by up to $2.2 billion for the quarter, which ends June 28.
Starbucks says 95% of its 8,000 U.S. company-run stores are now open with varying levels of service. U.S. sales at established stores are improving but fell 32% in the last week of May. In China, same-store sales were down 14%. Starbucks expects a third-quarter adjusted loss of 55 cents to 70 cents per share, far higher than the 16-cent loss analysts expected.
Starbucks shares fell 5% to $78.55 in morning trading.
VIRUS OUTBREAK-EUROPE-FAKE NEWS
EU wants tech giants to do more to counter virus fake news
BRUSSELS (AP) — A senior European Union official is demanding that tech firms like Google and Facebook provide detailed monthly reports on how they're tackling fake news linked to the coronavirus.
The EU says that a lot of disinformation targeting Europe is coming from China and Russia. European Commission Vice-President Vera Jourova says she doesn't “want to create a ministry of truth” by regulating disinformation, but that the companies can do more.
She praised the way Twitter fact-checked a tweet by US President Donald Trump raising concerns about election balloting without actually taking the post down.