Business Highlights: Fed holds rate steady; Job openings signal still-strong job market
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Federal Reserve leaves its key rate unchanged but keeps open possibility of a future hike
WASHINGTON (AP) — The Federal Reserve kept its key short-term interest rate unchanged for a second straight time but left the door open to further rate hikes if inflation pressures should accelerate in the months ahead. The Fed said in a statement after its latest meeting that it would keep its benchmark rate at about 5.4%, its highest level in 22 years. Since launching the most aggressive series of rate hikes in four decades in March 2022 to fight inflation, the Fed has pulled back and has now raised rates only once since May. The statement noted that recent tumult in the financial markets has sent longer-term interest rates up to near 16-year highs and contributed to higher borrowing rates across the economy.
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Stock market today: Wall Street rallies on hopes the Federal Reserve’s rate hikes are done
NEW YORK (AP) — U.S. stocks rallied after the Federal Reserve indicated it may not need to pump the brakes any harder on Wall Street and the economy. The S&P 500 rose 1.1% Wednesday. The Dow gained 221 points, and the Nasdaq composite jumped 1.6%. Treasury yields also eased in the bond market after the Fed announced its decision to hold interest rates steady, as expected. The Fed hinted that a swift rise since the summer in Treasury yields, and the resulting tumble in stock prices, may be slowing inflation on their own and acting like rate-hike substitutes.
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Countries at a UK summit pledge to tackle AI’s potentially ‘catastrophic’ risks
BLETCHLEY PARK, England (AP) — Delegates from 28 nations, including the U.S. and China, have agreed to work together to contain the potential “catastrophic” risks posed by galloping advances in artificial intelligence. The Bletchley Declaration by the first international AI Safety Summit focused only on cutting-edge “frontier” AI that some warn could pose a risk to humanity’s existence. Vice President Kamala Harris gave host country Britain a nudge with a speech stressing the transformation AI is already bringing and the need to hold tech companies accountable – including through legislation. Harris is scheduled to attend the summit’s second day on Thursday.
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Business group estimates several hundred thousand clean energy jobs in EV, battery storage and solar
A business group that advocates for clean energy estimates that 403,000 jobs will be created by the 210 major energy projects announced since the Inflation Reduction Act took effect in mid-2022. At least $86 billion in investments have been announced, with the biggest likely job gains in electric vehicles, battery storage and solar energy. E2 executive director Bob Keefe called it “the biggest economic revolution we’ve seen in generations.”
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U.S. job openings rise slightly in sign of continued strength in the job market
WASHINGTON (AP) — Employers posted 9.6 million job openings in September, up from 9.5 million in August and a sign that the U.S. job market remains strong in the face of higher interest rates. Layoffs fell, and the number of Americans quitting their jobs — a sign of confidence they can find better pay elsewhere — was virtually unchanged. The September openings are down from a record 12 million in March 2022 but remain high by historical standards. Before 2021 — when the American economy began to surge from the COVID-19 pandemic — monthly job openings had never topped 8 million.
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Real estate industry facing pushback to longstanding rules setting agent commissions on home sales
LOS ANGELES (AP) — A series of court challenges are seeking to upend longstanding real estate industry practices that determine the commissions agents receive on the sale of a home — and who foots the bill. One case ended Tuesday with a federal jury in Missouri ordering the National Association of Realtors and some of the nation’s biggest real estate brokerages to pay almost $1.8 billion in damages after finding that they artificially inflated agent commissions. At least two other court cases are pending. At issue: whether home sellers should be forced to pay the commission for the buyer’s agent in order to have their home listed on the widely used Multiple Listings Service.
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Prosecutor cites ‘pyramid of deceit’ by Sam Bankman-Fried; Defense lawyer says he’s no monster
NEW YORK (AP) — In a closing argument, a prosecutor told a New York jury to follow overwhelming evidence and the “pyramid of deceit” that FTX founder Sam Bankman-Fried constructed to conclude he’s guilty of fraud charges. Assistant U.S. Attorney Nicolas Roos launched a day of closings in Manhattan federal court by saying Bankman-Fried stole billions of dollars from investors worldwide. Defense attorney Mark Cohen countered that Bankman-Fried told the truth when he testified over four days. He said no fellow executives testified that Bankman-Fried told them to commit crimes. Bankman-Fried’s companies entered bankruptcy proceedings last November and he was arrested a month later.
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DoorDash orders surge 24% in the third quarter, helping the company narrow its losses
DoorDash reported better-than-expected sales in the third quarter as it gained users and they ordered more frequently. The San Francisco delivery company said its total orders grew 24% to 543 million in the July-September period. That was well above the 521 million orders Wall Street had forecast. DoorDash said revenue jumped 27% to $2.16 billion, also ahead of what Wall Street was expecting. The company said its monthly active users – or customers who have placed at least one order in the past month – increased at double-digit percentage rates in September, with strong demand from both the U.S. and international markets.
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The S&P 500 rose 44.06 points, or 1.1%, to 4,237.86. The Dow Jones Industrial Average rose 221.71 points, or 0.7%, to 33,274.58. The Nasdaq composite rose 210.23 points, or 1.6%, to 13,061.47. The Russell 2000 index of smaller companies rose 7.42 points, or 0.4% to 1,669.70.