Business highlights: Fast rate hikes, UAW jobs

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The Fed decided to impose another big rate hike to fight inflation

WASHINGTON (AP) – Conflicting signs about the health of the U.S. economy have put the Federal Reserve in a tight spot. With inflation at four-decade highs, a strong labor market and consumer spending still holding steady, the Fed is under pressure to raise interest rates aggressively. But other signs suggest the economy is slowing and may even have contracted in the first half of the year. Such evidence would usually prompt the Fed to hold off on raising rates — or even cut them. For now, however, the Fed is focused squarely on its inflation fight and this week is set to announce another big hike in its key interest rate.

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To save jobs, UAW chief says battery plants must unionize

SOUTHFIELD, Mich. (AP) — If the United Auto Workers union can’t organize workers at the new electric vehicle battery factories that will supply Detroit’s three automakers, the union’s future would be in serious doubt. Ray Curry, president of the 372,000-member UAW, says union representation at battery factories is critical, given that major automakers are staking their futures on the widespread adoption of electric vehicles. “It’s going to be the key to blocking that kind of new technology,” Curry said in an interview with The Associated Press on the eve of the union’s convention in Detroit this week. “It all depends on what happens from that bargain.”

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Former US congressman among 9 accused in insider trading cases

NEW YORK (AP) — In one of the most significant crackdowns by law enforcement on insider trading in a decade, nine people have been charged in four separate and unrelated insider trading schemes. They include a former US congressman from Indiana, tech company executives, an investment banker and a man training to be an FBI agent. The charges were announced Monday in Manhattan. An indictment identified Stephen Buyer as someone who appropriated the secrets he learned as a consultant to make about $350,000 illegally. Buyer was a Republican congressman from 1993 to 2011. He was arrested Monday in Indiana. His lawyer said he is innocent and his stock trades were legal.

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Rents rise as deep-pocketed investors buy mobile home parks

LOCKPORT, N.Y. (AP) – Investors are buying up mobile home parks across the country, leading to significant rent increases and complaints of neglect from residents. The parks, which for decades were largely owned and operated as small businesses, have proven an attractive investment for private equity firms and large real estate companies. They offer some of the best returns in the property sector, money made by raising rents and charging tenants with a host of fees. The industry argues that these investments are making the parks more livable, but residents, many on fixed incomes, say they can’t afford the rent increases and improvements often don’t come.

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Stocks closing mixed; Investors prepare for the Fed meeting

NEW YORK (AP) — Stocks are closing mixed Monday as investors prepare for a two-day Federal Reserve meeting this week. The country’s central bank is expected to raise interest rates significantly to fight inflation. The S&P 500 and Dow Jones Industrial Average rose slightly, led by energy, utilities and financial stocks. The tech-heavy Nasdaq Composite fell. Corporate earnings reporting picks up later this week, when tech heavyweights like Apple, Meta, Microsoft and Amazon all deliver quarterly results.

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Biden crushes computer chip box ahead of Senate vote

WASHINGTON (AP) – President Joe Biden is urging Congress to move quickly to send him a bipartisan bill designed to boost the computer chip industry and high-tech research in the United States. Biden calls semiconductors “the building blocks for the modern economy.” The Senate is expected to take a critical vote to advance the legislation on Tuesday, putting it on a path to final passage later this week. If the bill goes to Biden, his administration will score a victory on legislation it says is needed to protect national security and help the US better compete with China.

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Walmart cuts profit outlook as shoppers adjust to inflation

NEW YORK (AP) – Walmart is lowering its profit outlook for the fiscal second quarter and the full year. The country’s largest retailer cited rising inflation in basics like food that is causing shoppers to cut back on discretionary items, particularly clothing, that have higher profit margins. That consumer behavior is forcing the Bentonville, Arkansas-based company to increase discounts on general merchandise items to move inventory. As a result, Walmart said its adjusted earnings per share for the second quarter and full year are expected to fall about 8% to 9% and 11% to 13%, respectively.

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Budget airline Allegiant cuts profit outlook on rising costs

LAS VEGAS (AP) – Shares in the parent company of Allegiant Air are falling after the company cut its second-quarter profit forecast. Allegiant Travel Co said after the market closed on Monday that it expects to report earnings of 62 cents per share. That’s well below the $1.36 per share analysts were expecting. Allegiant is hitting the same headwinds against larger airlines — costs have risen for jet fuel and other expenses. The return of travel is even making Allegiant’s planes use more jet fuel. The airline is blaming full flights, which make planes heavier, for some of the increase in fuel costs.

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Zimbabwe debuts gold coins as legal tender to curb inflation

HARARE, Zimbabwe (AP) — Zimbabwe has floated gold coins for sale to the public in an effort to tame runaway inflation that has further eroded the country’s volatile currency. The unprecedented move was announced on Monday by the country’s central bank, the Reserve Bank of Zimbabwe, to boost confidence in the local currency. Confidence in Zimbabwe’s currency is low as people saw their savings wiped out by hyperinflation in 2008, which reached 5 billion%, according to the IMF. With strong memories of that disastrous inflation, many Zimbabweans today prefer to turn to the illegal market for scarce US dollars to keep at home as savings or for daily transactions. Confidence in the Zimbabwean currency is already so low that many retailers do not accept it.

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The S&P 500 gained 5.21 points, or 0.1%, to 3,966.84. The Dow Jones Industrial Average rose 90.75 points, or 0.3%, to 31,990.04. The Nasdaq fell 51.45 points, or 0.4%, to 11,782.67. The Russell 2000 index of smaller companies added 10.89 points, or 0.6%, to 1,881.77.

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