UK raises interest rates as central banks focus on inflation
LONDON: The United Kingdoms central bank has become the first in a major advanced economy to raise interest rates since the coronavirus pandemic began. Banks controlling monetary policy around the globe are shifting their focus from stimulating the economy to combating soaring consumer prices that arrived during the recovery. The moves come despite the threat that the new omicron variant of COVID-19 poses. The European Central Bank took a much more cautious approach than the Bank of England on Thursday. The U.S. Federal Reserve decided this week to speed up its exit from pandemic crisis support, while Norway raised rates and Turkey cut them.
Congress approves import ban targeting forced labor in China
WASHINGTON: The Senate has given final approval to a bill barring all imports from Chinas Xinjiang region unless businesses can prove they were produced without forced labor. In doing so they overcame initial hesitation from the White House and what supporters say was opposition from corporations. The measure is the latest in a series intensifying U.S. penalties over Chinas alleged abuses of ethnic and religious minorities in the western region, especially Xinjiangs millions of predominantly Muslim Uyghurs. The Commerce Department also has levied new sanctions targeting Chinas Academy of Military Medical Sciences and its 11 research institutes that focus on using biotechnology to support the Chinese military.
Big Tech companies sink, pushing Nasdaq composite down 2.5%
Technology companies led stocks lower on Wall Street Thursday as investors weighed the implications of higher interest rates as the Federal Reserve prepares to begin raising rates next year to fight inflation. The S&P 500 fell 0.9% and the tech-heavy Nasdaq slid 2.5%, its biggest drop since September. Traders were also considering other moves by global central banks. The Bank of England became the first central bank among leading economies to raise interest rates. The European Central Bank still plans to trim its pandemic stimulus, but not abruptly. The yield on the 10-year Treasury note fell to 1.43%.
Ousted McDonalds CEO returns $105M after misconduct
Former McDonalds CEO Steve Easterbrook has paid back more than $105 million in equity awards and cash to the burger giant after it learned that he had lied about the extent of his misconduct while he was its top executive. Easterbrook apologized Thursday, saying that he had failed at times to uphold McDonalds values. McDonalds fired Easterbrook in late 2019 after he acknowledged a relationship with an employee. Later, the board sued to claw back Easterbrooks compensation after it learned of several other inappropriate relationships with subordinates.
House report finds lax federal oversight of Trumps DC hotel
NEW YORK: A congressional report says the federal agency overseeing the lease of the luxury hotel that Donald Trumps family company runs in the nations capital failed to carry out its basic responsibilities. The report by a Democratic-run House committee says the General Services Administration never tracked the millions of dollars from foreign governments patronizing the hotel or examined the origins of a $75 million loan that helped keep its doors open. Neither the agency nor the Trump Organization responded to requests for comment. The GSA confirmed this week that the Trump Organization has given formal notice that its reached agreement to sell the hotel lease for $375 million to a Miami-based real estate investment firm.
Prosecution casts Elizabeth Holmes as a brazen con artist
SAN JOSE, Calif.: A federal prosecutor on Thursday described Theranos CEO Elizabeth Holmes as a shameless fraudster who duped investors and patents while concealing dangerous defects in her startups blood-testing technology. Federal prosecutors made their closing arguments in the three-month trial in which Holmes stands accused of repeatedly overstating the capabilities of her startups technology and its business progress. Lawyers for Holmes are making their own final arguments before the case, which has been underway for three months, is turned over to the jury. The panel will weigh 11 felony counts of fraud and conspiracy against Holmes, who is 37.
EU leaders urge booster shots, seek coordinated travel rules
BRUSSELS: European Union leaders have agreed that administering booster shots is urgent and crucial to tackle the surge of coronavirus infections across the continent and the emergence of the new omicron variant. With the festive season looming, the blocs leaders also stressed Thursday the importance of coordinated action to avoid a confusing cacophony of rules in the 27 member states, and ensure COVID-19 certificates continue to guarantee unrestricted travel. In their summits conclusions, leaders in Brussels insisted on the need for a harmonized approach to avoid limitations to free movement between member countries or hamper travel into the region. Alarming rises in infections have already prompted many European governments to implement new restrictions in recent weeks.
Biden signs bill hiking US borrowing limit by $2.5 trillion
WASHINGTON: President Joe Biden has signed a bill raising the nations borrowing limit by $2.5 trillion, avoiding a potentially catastrophic default and resolving the turbulent issue until after the 2022 midterm elections. The House voted early Wednesday to raise the debt limit, amid urgent warnings from Treasury Secretary Janet Yellen that further delay would jeopardize the full faith and credit of the United States. The Senate also voted to approve the debt increase under a deal struck between party leaders to diffuse the issue until after next years midterm elections. Republicans used the debt limit to attack Democrats big-spending social and environmental agenda while pledging to staunchly oppose the effort to increase the threshold.
CDC panel recommends Pfizer, Moderna vaccines over J&J shot
U.S. health advisers are recommending that most Americans get the Pfizer or Moderna vaccines instead of the Johnson & Johnson shot. Thursdays recommendation came after government advisers reviewed new safety data about rare but potentially life-threatening blood clots linked to J&Js shot. The Pfizer and Moderna vaccines dont come with this risk and are widely available. Of the 200 million fully vaccinated Americans, only a small fraction about 16 million got the J&J option. Now the Centers for Disease Control and Prevention must decide whether to accept the unusual recommendation.
European Central Bank to taper pandemic stimulus, but gently
FRANKFURT, Germany: The European Central Bank has decided not to abruptly pull back its pandemic support for the economy as the new omicron variant of COVID-19 stirs uncertainty about the continents recovery. The move Thursday comes despite inflation hitting record highs and the U.S. speeding up its stimulus exit. The bank confirmed that it will phase out its 1.85 trillion euro pandemic bond purchase stimulus on schedule next year but will maintain some of the effect by moving part of the purchases to another support program. The 19 European Union member countries that use the euro already had been seeing the economic rebound slow because of a rise in infections from the delta variant and shortages of parts and raw materials.
The S&P 500 fell 41.18 points, or 0.9%, to 4,668.67. The Dow Jones Industrial Average fell 29.79 points, or 0.1%, to 35,897.64. The Nasdaq fell 385.15 points, or 2.5%, to 15,180.43. The Russell 2000 index of smaller companies fell 42.75 points, or 1.9%, to 2,152.46.
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