The Week in Business: More Strong Job Gains

Credit…Giacomo Bagnara

The Labor Department reported another solid month of job growth in April on Friday. U.S. employers added 428,000 jobs, the department said, the same as the revised figure for March. The unemployment rate in April remained at 3.6 percent. The United States has regained nearly 95 percent of the 22 million jobs lost at the height of pandemic lockdowns. Employers’ scramble for workers as the economy has recovered helped push up wages — the April survey showed average hourly earnings 5.5 percent higher than a year earlier — but those gains for workers have been largely offset by a surge in prices. The labor supply has not kept up with job openings, and the labor force shrank unexpectedly in April.

The Federal Reserve on Wednesday raised interest rates by half a percentage point, the largest increase since 2000, and detailed a plan to shrink its huge bond holdings — decisive measures aimed at cooling rapid inflation. The Fed chair, Jerome H. Powell, said half-percentage point increases were “on the table” for upcoming meetings, but he shot down the idea that policymakers were considering an even larger move. The Fed’s move came after the Personal Consumption Expenditures price index — the Fed’s preferred measure of inflation — showed that prices climbed 6.6 percent in the year through March, the quickest pace of increase since 1982.

The billionaire mogul Elon Musk revealed on Thursday that he had raised around $7 billion from 18 entities to help fund his $44 billion acquisition of Twitter. The investors came from a mix of Mr. Musk’s Silicon Valley connections — including venture capital firms such as Andreessen Horowitz and tech moguls like Larry Ellison of Oracle — as well as cryptocurrency companies, family offices, sovereign wealth funds, property firms and mutual-fund companies, the filing showed. The new funding commitments were a sign that Mr. Musk, who leads the electric carmaker Tesla and the rocket company SpaceX, was still figuring out his plans for Twitter after striking a deal on April 25 to buy the company. It had been unclear how Mr. Musk would carry out his financing plans, which included $21 billion of his own cash and a $12.5 billion loan against his shares in Tesla. The new commitments reduce the size of the loan against those shares.

Credit…Giacomo Bagnara

The stock market’s gyrations have become more dramatic than usual. Even though markets rallied after the Federal Reserve increased rates on Wednesday, they plunged on Thursday, highlighting Wall Street’s worries about what the Fed’s campaign to slow inflation will mean for the economy. The S&P 500 fell 3.6 percent on Thursday, following a gain of 3 percent on Wednesday. The plunge dashed hopes of a quick recovery after April proved to be Wall Street’s worst month since March 2020. The Nasdaq composite slid 5 percent, its biggest drop since June 2020. Yields on government bonds spiked, with the rate on 10-year U.S. Treasury notes, a benchmark for borrowing costs across the economy, climbing above 3 percent and touching its highest level since 2018.

The Consumer Price Index for April — the Labor Department’s monthly report on prices for goods and services — is coming out on Wednesday. Economists will be watching to see if the numbers indicate that the nation’s inflation crisis shows signs of peaking. Last month, the report showed that prices were 8.5 percent higher in March than a year earlier, the fastest 12-month pace since 1981. A jump in gasoline prices tied to Russia’s invasion of Ukraine, rising costs for food and rent and strong demand all contributed.

Rivian, a potential competitor for the electric carmaker Tesla, will announce its earnings for the first three months of this year on Wednesday. After some production challenges — with Rivian paring down delivery targets for the year — amid a time of global supply chain turmoil, the earnings report may show whether the company is bouncing back. Both Amazon and Ford reported that they had lost billions of dollars in the first three months of the year after the value of their stakes in Rivian plunged. Rivian, which makes a high-end truck and sport utility vehicle, had faced a backlash after it announced a 20 percent price increase on two of its vehicles, a decision it then walked back.

The energy giant Shell on Thursday reported its biggest ever quarterly profit, and BP on Tuesday reported its highest profit in a decade, reflecting surging prices for oil and natural gas. The Amazon Labor Union lost its vote at a second Staten Island warehouse, after winning a landmark victory last month at a larger Amazon facility nearby. The stationary bike maker Peloton, an early pandemic winner that lost steam as people returned to gyms, will report earnings this week.

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