Business Highlights: US trims growth estimate for 2nd quarter; Biden touts efforts on drug prices
___ US economic growth for last quarter is revised down to a 2.1% annual rate
WASHINGTON (AP) — The U.S. economy expanded at a 2.1% annual pace from April through June, showing continued resilience in the face of higher borrowing costs for consumers and businesses, the government said in a downgrade from its initial estimate. The government had previously estimated that the economy expanded at a 2.4% annual rate last quarter. The Commerce Department’s second estimate of growth last quarter marked a slight acceleration from a 2% annual growth rate from January through March. Though the economy has been slowed by the Federal Reserve’s strenuous drive to tame inflation with interest rate hikes, it has managed to keep expanding, with employers still hiring and consumers still spending.
___
10 drugs targeted for Medicare price negotiations as Biden pitches cost reductions
WASHINGTON (AP) — President Joe Biden is touting his administration’s efforts to lower medical costs. Officials on Tuesday announced the first 10 drugs that would be targeted for Medicare price negotiations. The popular diabetes treatment Jardiance and the blood thinner Eliquis are on the list. Biden says “we’re going to keep standing up to Big Pharma and we’re not going to back down.” The Democratic president’s move faces litigation from drugmakers and criticism from Republican lawmakers. A pharmaceutical lobbying group says the list stems from “a rushed process focused on short-term political gain rather than what is best for patients.”
___
Millions more workers would be entitled to overtime pay under a proposed Biden administration rule
NEW YORK (AP) — The Biden administration is proposing a new rule that would make 3.6 million more U.S. workers eligible for overtime pay, reviving an Obama-era policy effort that was ultimately scuttled in court. The new rule would require employers to pay overtime to so-called white collar workers who make less than $55,000 a year, up from the current threshold of $35,568, which was set by the Trump administration in 2019. In another significant change, the rule proposes automatic increases to the salary level every three years. The new rule, which is subject to a publicly commentary period and wouldn’t take effect for months, would have the biggest impact on retail, food, hospitality, manufacturing and other industries where many managerial employees meet the new threshold.
___
US commerce secretary warns China will be ‘uninvestable’ without action on raids, fines
SHANGHAI (AP) — Commerce Secretary Gina Raimondo says she warned Chinese leaders that U.S. businesses might stop investing in their country without prompt action to address complaints about worsening conditions due to raids on firms, unexplained fines and unpredictable official behavior. The issue is especially sensitive at a time when President Xi Jinping’s government is trying to revive investor interest to help reverse a deepening economic slump. Raimondo visited Beijing as part of U.S. efforts to restore relations that are beset by disputes about technology, security, Taiwan and other issues. She called her meetings with China’s No. 2 leader, Premier Li Qiang, and other officials “very productive” but said she “didn’t pull any punches” in conveying business complaints.
___
CNN names Mark Thompson, former BBC and New York Times executive, as its new leader
NEW YORK (AP) — CNN is bringing in former New York Times and BBC leader Mark Thompson in an attempt to turn around its fortunes. Parent company Warner Bros. Discovery announced Wednesday that Thompson will be the new chair and CEO of CNN Worldwide. He’ll be CNN’s third leader in less than two years and replaces Chris Licht, who was fired in June. The pioneering Cable News Network has bled viewers and seen its profits tumble as it has struggled to make its way in a competitive landscape where people seek television news with a point of view. Thompson helped lead the Times’ transition to a digital-first service with a large subscriber base.
___
Stock market today: Wall Street ends higher, chipping away at losses for August
NEW YORK (AP) — Stocks closed modestly higher on Wall Street, chipping away at their losses for August. Treasury yields fell Wednesday after some weaker-than expected readings on the U.S. economy and job market. The S&P 500 rose 0.4%, its fourth gain in a row. It’s still down 1.6% for August, with one trading day left in the month. The Dow Jones Industrial Average added 37 points, or 0.1%, and the Nasdaq composite rose 0.5%. The yield on the 2-year Treasury note fell to 4.88%. HP sank 6.6% after cutting its profit forecast for the year.
___
Tesla is allowing no-hands driving with Autopilot for longer periods. US regulators have questions
DETROIT (AP) — Tesla is letting some drivers to use its Autopilot driver-assist system for extended periods without making them put their hands on the steering wheel, a development that has drawn concern from U.S. safety regulators. The National Highway Traffic Safety Administration has ordered Tesla to tell the agency how many vehicles got a software update making the change and what its plans are for wider distribution. In a July letter to Tesla, the agency says it’s concerned that more drivers will activate the change, leading to more driver inattention. The government has been investigating Autopilot for crashing into emergency vehicles parked on freeways, as well as hitting motorcycles and crossing tractor-trailers. At least 17 people have died in crashes.
___
States at the forefront of fights over wetlands protections after justices slash federal rules
The Supreme Court in May sharply curtailed the Clean Water Act’s power to protect millions of acres of wetlands. After the federal court decision, the fight over wetlands protections will be fought more often at the state level. Roughly half of states link their protections to standards set by the federal government, and those protections will weaken after the justices’ decision. Some states may try and strengthen their rules. Others like North Carolina can loosen them after the federal change, a win for developers and agricultural groups.
___
Russia earns less from oil and spends more on war. So far, sanctions are working like a slow poison
The Russian currency has stabilized after dipping below 100 rubles to the U.S. dollar — but that doesn’t mean the pressure is off Russia’s economy. Western sanctions have cut into oil earnings, while government spending is heating up the economy, threatening to increase inflation. Russia’s central bank can strongly influence the ruble exchange rate, and did that with a recent emergency interest rate increase. But long term, Russia’s dwindling oil earnings and higher spending on imports will keep downward pressure on the ruble. Sanctions are working like a slow poison, reducing investment and undermining long-term economic growth. Some analysts suggest a lower price cap on Russian oil will increase the pressure.
___
Japanese ministers eat Fukushima fish to show it’s safe after nuclear plant wastewater is discharged
TOKYO (AP) — Japan’s Prime Minister Fumio Kishida and three Cabinet ministers have eaten Fukushima fish sashimi at a lunch meeting in an apparent effort to show that fish is safe following the release of treated radioactive wastewater from the Fukushima Daiichi nuclear power plant. The release of the treated wastewater into the ocean, which began Thursday and is expected to continue for decades, has been strongly opposed by fishing groups and by neighboring countries. All seawater and fish sampling data since the release have been way below set safety limits. Japan’s Foreign Ministry has issued a travel advisory urging Japanese citizens to use extra caution in China. It cited an escalation of harassments and violent protests over the discharge of the wastewater.
___
The S&P 500 rose 17.24 points, or 0.4%, to 4,514.87. The Dow Jones Industrial Average rose 37.57 points, or 0.1%, to 34,890.24. The Nasdaq composite rose 75.55 points, or 0.5%, to 14,019.31. The Russell 2000 index of smaller companies rose 7.67 points, or 0.4%, to 1,903.21.