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Business Highlights: Jobless Claims Rise, Stocks Rally Again

Business Highlights: Jobless Claims Rise, Stocks Rally Again

The number of Americans applying for unemployment aid rose last week for a second straight week to 351,000, a sign that the delta variant of the coronavirus may be disrupting the job markets recovery, at least temporarily. Thursdays report from the Labor Department showed that jobless claims rose by 16,000 from the previous week. As the job market has strengthened, unemployment aid applications, which generally track layoffs, have tumbled since topping 900,000 early this year, reflecting the economys reopening after the pandemic recession. Still, jobless claims remain somewhat elevated: Before the pandemic tore through the economy in March 2020, they generally numbered about 220,000 a week.

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US jobless claims tick up from near a pandemic low
WASHINGTON: The number of Americans applying for unemployment aid rose last week for a second straight week to 351,000, a sign that the delta variant of the coronavirus may be disrupting the job markets recovery, at least temporarily. Thursdays report from the Labor Department showed that jobless claims rose by 16,000 from the previous week. As the job market has strengthened, unemployment aid applications, which generally track layoffs, have tumbled since topping 900,000 early this year, reflecting the economys reopening after the pandemic recession. Still, jobless claims remain somewhat elevated: Before the pandemic tore through the economy in March 2020, they generally numbered about 220,000 a week.
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Top Dems: We have framework to pay for $3.5T bill; no detail
WASHINGTON: Top congressional Democrats say they and the White House have agreed to a framework to pay for their emerging $3.5 trillion social and environment bill. Senate Majority Leader Chuck Schumer and House Speaker Nancy Pelosi revealed the development to reporters on Thursday. But they offered no details, and the significance was unclear. Biden administration officials and Democratic congressional leaders have been negotiating behind the scenes on the huge package of spending and tax initiatives. The party has been divided over its final size and many of its details, and there has been no public word that agreements have been reached on any of those crucial questions.
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Fears of global shockwaves from Chinese builders debts ease
BEIJING: Fears that a Chinese real estate developers possible default on multibillion-dollar debts might send shockwaves through global financial markets appear to be easing as creditors wait to see how much they might recover. Shares of Evergrande Group, one of Chinas biggest private sector conglomerates, rose 18% in Hong Kong after the company said it would pay interest to bondholders in China. The company gave no sign whether it would make a payment due Thursday on a separate bond abroad. As details of Evergrandes $310 billion in debt became clearer, economists said despite likely losses for Chinese banks and other creditors it appears a default would not feed through to financial markets abroad.
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Another rally on Wall Street erases losses for the week
Stocks rose broadly for a second day in a row on Wall Street Thursday, reversing the markets losses for the week just three days after the S&P 500 had its biggest skid since May. The S&P 500 added 1.2% and the Dow Jones Industrial Average rose 1.5%. Investors were pleased to have gotten some clarity from the Federal Reserve a day earlier that it was not on the verge of raising interest rates, and there was also reassuring news out of China, where Evergrande, one of the countrys biggest private real estate developers, appeared to avoid what could have been a messy default.
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Fed: On track to slow support for economy later this year
WASHINGTON: Federal Reserve Chair Jerome Powell signaled Wednesday that the Fed plans to announce as early as November that it will start withdrawing the extraordinary support it unleased after the coronavirus paralyzed the economy 18 months ago. Powell said that if the job market maintained its steady improvement, the Fed would likely begin slowing the pace of its monthly bond purchases. At the same time, the Feds policymaking committee indicated Wednesday that it expects to start raising its benchmark interest rate sometime next year earlier than the members envisioned three months ago and a sign that they are concerned that high inflation pressures may persist.
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Philanthropies pledge billions during UN meeting
Bill and Melinda Gates private foundation announced Thursday it will spend more than $900 million over the next five years to curb global malnutrition. Its one of several pledges private donors have announced this week as world leaders gather in New York for the annual U.N. General Assembly. On Wednesday, a coalition of nine foundations said they would collectively spend $5 billion by 2030 to protect at least 30% of the planets land and sea. Foundations have played a prominent role in supporting the U.N.s 2030 agenda for sustainable development. And experts say theyre choosing to announce initiatives this week to influence the public agenda.
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Bank of England keeps rates on hold, warns over inflation
LONDON: The Bank of England kept its main interest rate at the record low of 0.1% but warned that inflation is set to be double its target rate by the end of this year largely as a result of a sharp spike in energy prices. The decision Thursday from the central banks nine-member Monetary Policy Committee was unanimous, though two members voted to start reining in a stimulus program intended to keep borrowing rates low in financial markets. The panel said in its meeting minutes that developments over the past month had strengthened the case for some tightening of monetary policy in order to meet the banks 2% inflation target sustainably in the medium term.
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Dubai real-estate firm DAMAC approved to take firm private
DUBAI, United Arab Emirates: A Dubai real-estate company known for its deals with former President Donald Trump says it has received regulator approval for an effort to take the firm private. DAMAC Properties still plans to offer $595 million for outstanding shares of the company, the firm said in a filing on Dubai Financial Market stock exchange. It said it would offer an update on the plan in the coming weeks. It earlier announced plans in June for the offer to take the company private, then withdrew them as regulators examined the plan. DAMACs billionaire founder Hussain Sajwani already owns nearly four-fifths of the company through various investment firms.
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US long-term mortgage rates up slightly; 30-year at 2.88%
WASHINGTON: Average long-term mortgage rates rose slightly this week continuing a months-long trend of little movement. They remain under 3%. Mortgage buyer Freddie Mac reports that the average rate for a 30-year mortgage edged up to 2.88% from 2.86% last week. The rate for a 15-year loan increased to 2.15% from 2.12% last week. Amid anxiety that the highly contagious delta variant could cause the economic recovery from the pandemic to stall, the Federal Reserve on Wednesday signaled its belief that the economy has recovered sufficiently from the recession for it to soon begin dialing back the emergency aid it provided after the virus erupted.
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Under pressure, Powell says Fed to revamp its trading rules
WASHINGTON: Federal Reserve Chair Jerome Powell said the central bank will overhaul its financial ethics policies in response to growing questions about investing and trading decisions by high-ranking Fed officials that raise potential conflicts of interest. Powell stopped short of saying explicitly that the trading moves were inappropriate. And he provided no details about what the Fed might do or how it would conduct its ethics review. The issue arose after it was revealed that Robert Kaplan, president of the Federal Reserve Bank of Dallas, had traded millions of dollars worth of individual stocks at the same time that the Fed was discussing and taking extraordinary measures to boost the economy.
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The S&P 500 rose 53.34 points, or 1.2%, to 4,448.98. The Dow Jones Industrial Average rose 506.50 points, or 1.5%, to 34,764.82. The Nasdaq rose 155.40 points, or 1%, to 15,052.24. The Russell 2000 index of smaller companies rose 40.48 points, or 1.8%, to 2,259.04.
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first published:September 24, 2021, 02:39 IST