Business Highlights

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Fed to keep providing aid and sees no rate hike through 2022

WASHINGTON (AP) — Confronted with an economy gripped by recession and high unemployment, the Federal Reserve signaled Wednesday that it expects to keep its key short-term interest rate near zero through 2022. The Fed also said it will keep buying about $120 billion in Treasury and mortgage bonds each month to keep longer-term borrowing rates low. The central bank’s key short-term rate influences a range of loans, including for homes, autos and credit cards. Keeping it pegged at nearly zero could make it easier for consumers and businesses to borrow and spend enough to sustain an economy depressed by the coronavirus.

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Europe reopens borders amid worst global recession in memory

PARIS (AP) — The world faces the worst global recession in nearly a century, a key economic body warns, while in Europe, restrictions to fight the spread of coronavirus portend for a bleak summer tourism season even as more nations announced plans to welcome visitors. Beginning June 16, Austria will open up to all European neighbors with the exception of Spain, Portugal, Sweden and Britain, meaning that visitors from 31 countries will no longer have to undergo a two-week quarantine. But that’s hoping people have money to spend.

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Stocks end mostly lower, even as Nasdaq tops 10,000 points

NEW YORK (AP) — Stocks ended a bumpy day mostly lower Wednesday despite assurances from the Federal Reserve that it would keep interest rates low through 2022 and would continue buying bonds to help markets function smoothly. The S&P 500 fell 0.5%. Most sectors finished lower, but gains from several big technology companies helped push the Nasdaq above 10,000 for the first time. Bond yields fell, a sign that investors remained cautious. Markets got off to a shaky start after the Organization for Economic Cooperation and Development said the coronavirus crisis has triggered the worst global recession in nearly a century.

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Backlash over George Floyd tweet forces out CrossFit founder

NEW YORK (AP) — The founder and CEO of CrossFit is stepping down after his tweet about George Floyd sparked a social media backlash and a wave of affiliated gyms cut ties with the company. Reebok also dropped its affiliation with CrossFit this week. Greg Glassman said on CrossFit’s website late Tuesday that he would retire. Glassman had apologized earlier for tweets that sparked online outrage by connecting Floyd, an African American man who died at the hands of the Minneapolis police, and the coronavirus pandemic in a tweet. He said he had made a mistake and should have been more sensitive, but denied being racist.

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Another big mall deal implodes as pandemic 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 industry. Simon Property Group announced it would buy Taubman in early February, just weeks before the Centers for Disease Control and Prevention announced that a California man was being treated for coronavirus, the first known case in the U.S. In its legal complaint Wednesday, Simon said that Taubman is uniquely vulnerable as stores reopen because it mostly owns indoor malls “that many consumers will avoid.”

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Google quietly rolls out test version of Android upgrade

SAN RAMON, Calif. (AP) — Google has released a test version of its annual upgrade to its Android software without the usual fanfare heralding the latest operating system powering most smartphones. The debut of Android 11′s “beta” version was announced Wednesday in a blog post, along with video tutorials for the makers of smartphone applications on Google’s YouTube service. Android 11 will offer several new features that will make it easier for people to find notifications about incoming texts and continue ongoing digital conversations.

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US deficit racks up record deficit with 4 months still to go

WASHINGTON (AP) — The federal government recorded a budget deficit of $1.88 trillion for the first eight months of this budget year, larger than even any annual shortfalls in U.S. history. The sea of red ink grew as government spending shot up to deal with the coronavirus pandemic and tax revenue shrank when millions lost their jobs. The Treasury Department reported Wednesday that the deficit for the October-May period was more than double the $738.6 billion deficit for the same period last year. The deficit for just the month of May totaled $398.8 billion, a record for the month.

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May consumer prices fall 0.1%, the third consecutive 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.

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The S&P 500 dropped 17.04 points, or 0.5%, to 3,190.14. The Dow Jones Industrial Average fell 282.31 points, or 1%, to 26,989.99. The Nasdaq composite gained 66.59 points, or 0.7%, to 10,020.35. The Russell 2000 index of smaller-company stocks lost 39.66 points, or 2.6%, to 1,467.39.