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Most U.S. stocks are rising Friday after a report showed that inflation is behaving roughly as economists expected, even if its still high. The S&P 500 added 0.2%, as four out of every five stocks within the index climbed. The Dow Jones Industrial Average was up 211 points, or 0.5%, as of 11:45 a.m. Eastern time, and the Nasdaq composite was 0.1% lower because of drops for a handful of influential Big Tech stocks. All three indexes are near their all-time highs set at the start of the week. Stocks got some help from a report showing that inflation in the United States accelerated to 2.7% last month from 2.6% in July, according to the measure of prices that the Federal Reserve likes to use. While thats above the Feds 2% target, and its more painful than any household would like, it was precisely what economists had forecast. That offered some hope that the Fed could continue cutting interest rates in order to give the economy a boost. Thats critical for Wall Street because its already sent U.S. stocks on a blistering run to records from a low in April in large part because of expectations for a string of rate cuts. Without them, growing criticism that stock prices have become too expensive by rising too quickly would become even more powerful. The S&P 500 is on track for a 0.7% loss for this week, which would be one of its worst since its rally took off in April but only relatively modest compared with history. The Fed just delivered its first rate cut of the year last week, and officials had penciled in more through the end of next year. Fed Chair Jerome Powell has warned, though, that plans may have to change quickly. Thats because cuts to rates carry the risk of worsening inflation. One factor threatening to push inflation higher is President Donald Trumps tariffs, and he announced a set of more late Thursday. They include taxes on imports of some pharmaceutical drugs, kitchen cabinets and bathroom vanities, upholstered furniture and heavy trucks starting on Oct. 1. Details were sparse about the coming tariffs, as is often the case with Trumps pronouncements made on his social media network. That left analysts unsure of their ultimate effects, and the announcement created ripples in the U.S. stock market instead of huge waves. Paccar, the company based in Bellevue, Washington, thats behind the Peterbilt and Kenworth truck brands, revved 5% higher, for example. Big U.S. pharmaceutical companies nudged higher. Eli Lilly rose 0.9%, and Pfizer added 0.2%. Several companies that sell home furnishings, which could be hurt by higher prices for imports, swung between gains and losses. Williams-Sonoma went from an initial loss of 2.5% to a modest gain and back to a loss of 1.1%, for example. RH dropped 3.8% following a similar back and forth. On the losing end of Wall Street was Costco Wholesale, which fell 1.9% even though it reported a stronger profit for the latest quarter than analysts expected. Renewal rates for its membership slowed a touch, while an important measure of underlying revenue growth at its stores fell short of analysts expectations. In stock markets abroad, indexes rose in Europe after slumping in Asia. Frances CAC 40 climbed 0.9%, while South Koreas Kospi tumbled 2.5% for two of the worlds bigger moves. Japans Nikkei 225 fell 0.9% as Sumitomo Pharma Co.s shares lost 3.5% and Chugai Pharmaceutical sank 4.8%. In the bond market, the yield on the 10-year Treasury held steady at 4.18%, where it was late Thursday. A report said sentiment among U.S. consumers was weaker than economists expected. The survey from the University of Michigan said consumers are frustrated with high prices, but their expectations for inflation over the coming 12 months also ticked down to 4.7% from 4.8%. One notable exception was among Americans who own plenty of stocks, who have benefited from Wall Street’s run to records even as the job market slows. Sentiment for them held steady in September, while decreasing for households with smaller or no stock investments. The next big event for Wall Street could be a looming shutdown of the U.S. government, with a deadline set for next week. But investors have experience with such political impasses, and they’ve had limited impact on the market before. The market and broader macroeconomic effects of a shutdown, even lengthy ones, are often mere blips on the charts, according to Brian Jacobsen, chief economist at Annex Wealth Management. Stan Choe, AP business writer AP Writers Teresa Cerojano and Matt Ott contributed.
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E-Commerce
Starting next week on Tuesday, September 30, the Social Security Administration (SSA) will no longer issue paper checks for benefit payments, and instead move exclusively to electronic payments: either direct deposit or a pre-paid debit card. The change is part of a broader government-wide initiative to modernize its services and improve efficiency and security, to ensure some 70 million Americans receive their monthly benefits promptly. However, this could mean trouble for some older Americans who do not know how to set up direct deposit or will have trouble using a pre-paid debit card. In March, President Trump issued Executive Order 14247, which mandates the transition to electronic payments for all federal disbursements by September 30. “Less than one percent of Social Security Administration beneficiaries currently receive paper checks,” a Social Security spokesperson told Fast Company in an email on Friday. “SSA is proactively contacting those beneficiaries to alert them about the change and the process to enroll in direct deposit or receive Direct Express cards.” In cases where a beneficiary has no other means to receive payment, the SSA said it will continue to issue paper checks. According to the Treasury Department, this shift could save the federal government millions of dollars each year. Issuing a paper check costs about 50 cents, while an electronic payment (or EFT) costs less than 15 cents. Electronic payments are also more secure. Paper checks are 16 times more likely to be lost or stolen compared to electronic payments, thus increasing the risk of fraud, according to the agency. How do I sign up for Social Security direct deposit or a pre-paid debit card? For more details, and to learn how to enroll in direct deposit or obtain a Direct Express pre-paid debit card, visit www.ssa.gov/deposit/. To enroll in direct deposit, go online to your personal “my Social Security account” (or create an account, if you don’t have one) on the Social Security Administration’s website. Enrollment in direct deposit and Direct Express Debit Mastercard are also available through the Treasury’s Go Direct website, or via phone at 1-877-874-6347. For additional questions, call the Social Security Administration at 1-800-772-1213.
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E-Commerce
The Federal Reserves favored inflation gauge accelerated slightly in August from a year earlier. The Commerce Department reported Friday that its personal consumption expenditures (PCE) price index was up 2.7% in August from a year earlier, a tick higher from a 2.6% year-over-year increase in July and the most since February. Excluding volatile food and energy prices, so-called core PCE inflation showed a 2.9% increase in prices from August 2024, the same as in July. The increases were what forecasters had expected. Prices rose 0.3% from July, compared to a 0.2% increase the month before. Core prices rose 0.2%, the same as in July. Separately, the report showed that inflation-adjusted consumer spending rose a healthy 0.4% from July, the same as the month before, largely on a 0.7% increase in spending for goods; spending on services such as travel and dining out rose just 0.2%. The resilience of the U.S. consumer was on show once again,” Michael Pearce of Oxford Economics wrote, though he cautioned that spending is being driven by households at the top of the income distribution.” Incomes rose 0.4%, the same as the month before. Income for the self-employed and business owners rose 0.9% for the second straight month. Wages and salaries rose 0.3% from July, dipping from a 0.5% increase the month before. Inflation has come down since rising prices prompted the Fed to raise its benchmark interest rate 11 times in 2022 and 2023. But annual price gains remain stubbornly above the central banks 2% target. Last week, the Fed went ahead and reduced the rate for the first time this year, lowering borrowing costs to help a deteriorating U.S. job market. But its been cautious about cutting, waiting to see what impact President Donald Trumps tariffs on imports have on inflation and the broader economy. For months, Trump has relentlessly pushed the Fed to lower rates more aggressively, calling Fed Chair Jerome Powell Too Late and a moron and arguing that there is no inflation. Last month, Trump sought to fire Lisa Cook, a member of the Feds governing board, in an effort to gain greater control over the central bank. She has challenged her dismissal in court, and the Supreme Court will decide whether she can stay on the job while the case goes through the judicial system. The Fed tends to favor the PCE inflation gauge that the government issued Friday over the better-known consumer price index. The PCE index tries to account for changes in how people shop when inflation jumps. It can capture, for example, when consumers switch from pricier national brands to cheaper store brands. By Paul Wiseman, AP economics writer
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E-Commerce
Christine Renauld, CEO and Co-founder of Braindate, discusses how her app is revolutionizing networking by turning it into purposeful, meaningful conversations.
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E-Commerce
Don’t look now, but President Trump just issued more sweeping tariffs. This latest round stands to affect two groups particularly hard: homeowners and furniture and home furnishing companies. Thats because the new round of Trumps tariffs will see up to 50% fees applied to kitchen cabinets and upholstered furniture imported into the United States. Heres what you need to know. Whats happened? Yesterday, the president of the United States took to his social media platform to announce another sweeping round of tariffs, including a 100% tariff on some pharmaceutical products and a 25% tariff on heavy trucks. But smack in the middle of those two high tariffs was another tariff Trump announced, this one of 50%. The president said that from October 1, there will also be new, 50% tariffs on select home items, including bathroom vanities, kitchen cabinets, as well as other associated products. But Trump didnt stop there. He said that from the same date, there would also be 30% tariffs on upholstered furniture. The reason for this is the large scale FLOODING of these products into the United States by other outside Countries, the president wrote. It is a very unfair practice, but we must protect, for National Security and other reasons, our Manufacturing process. While Trump said that pharmaceutical companies that are breaking ground on manufacturing facilities, or have facilities under construction, in the United States wont be hit with the 100% duties, he gave no indication that companies could escape the 50% kitchen cabinet and 30% upholstered furniture levies. Swedish furniture company Ikea could be hit hard Shortly after Trumps latest tariff announcements, Ikea tariff began trending on social media. Its easy to see why. The Swedish company Ikea is the most prominent name in the home furnishing space in America. The companys store locator tool lists more than 50 locations in the U.S. Whats especially bad for Ikea is that relatively few of its products are manufactured in America. The company has previously said that only about 10% of the products it sells in the United States are made in North or South America. Roughly 90% of its products are imported from overseas. In a FAQ on Ikeas Spanish website, the company says that it has over 1,200 furniture suppliers around the world, and notes that The five countries that supply the majority of products and services to Ikea are China, Poland, Italy, Germany and Sweden. Given the number of products that Ikea sells that would be covered under Trumps new 30% to 50% tariffs, the company now risks a major hit to its margins in the United States. Fast Company has reached out to Ikea for comment on how Trumps new tariffs will affect the company. What do the new tariffs mean for homeowners? Of course, Ikea and similar home furnishing companies are the only ones Trumps new tariffs will hit hard. American homeowners and renters are likely to feel the pain of the new tariffs, too. Its highly unlikely that Ikea, like most companies, will simply absorb the cost of the tariffs themselves. They will first try to offset some of those costs by asking for price concessions from their suppliers. However, the next step is usually to raise the prices of the tariffed items, so the end-buyerthe American consumerpays more for them. This means that homeowners and renters seeking new furniture for their dwelling will likely see a hike in prices in the near future after the tariffs come into effect next Wednesday. How are furniture and home furnishing stocks reacting? Ikea is a private company, so its shares arent traded on the public markets. However, there are plenty of other publicly traded furniture and home furnishing companies. Surprisingly, many of their investors seem to be taking the news pretty well. Most of the stock prices of the home furnishing companies below are trading relatively flat as of the Time of this writing. Bassett Furniture Industries, Incorporated (Nasdaq: BSET): up 2.4% Hooker Furnishings Corporation (Nasdaq: HOFT): down 1.6% La-Z-Boy Incorporated (NYSE: LZB): up 1.6% RH (NYSE: RH): down 0.7% Wayfair Inc. (NYSE: W): up 0.2% Williams-Sonoma, Inc. (NYSE: WSM): down 1.6% One reason for the general steadiness of these stocks may be that investors have become almost desensitized to the near-weekly tariff announcements from the president. Additionally, in November, the Supreme Court is set to hear a challenge regarding the constitutionality of Trump’s levying tariffs against countries and industriesa power historically reserved for Congress. If the Supreme Court rules against Trump, all of the tariffs he imposedincluding the home furnishing ones this weekcould be revoked.
Category:
E-Commerce
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