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The US economy is benefiting from the higher-pressure effect

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Nike shares tumble after downgrading sales outlook

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Tata Steel threatens to shut Port Talbot blast furnaces early over strikes

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Tata Steel, Britain’s biggest steel producer, has threatened to shut down its two blast furnaces in south Wales from as early as next week unless workers from the Unite union call off a strike.

The Indian-owned group operates two of Britain’s last remaining such facilities at Port Talbot and had been planning to close one of them by the end of June and the second by September.

Tata said on Thursday that due to the strike, which is set to start on July 8, it might have to begin the process of closing both from July 1 for safety reasons. They would then be permanently shut no later than July 7.

“If in the coming days, we cannot be certain that we are able to continue to safely and stably operate our assets through the period of strike action, we will not have any choice but to pause or stop heavy end operations (including both blast furnaces) on the Port Talbot site,” the company said.

Tata also said it had started legal action against Unite, challenging the validity of the strike ballot.

Unite said last week that about 1,500 workers would begin an indefinite strike from July 8. Members of the union in April voted for industrial action for the first time in 40 years in protest at Tata’s decision to shut both furnaces this year. The closures would result in up to 2,800 job losses and are part of a government-funded plan to shift to production using an electric arc furnace requiring fewer workers.

Rajesh Nair, chief executive of Tata Steel UK, told employees in a message on Thursday that closing the two furnaces early would have “major implications for our company”.

The company, he said, had proposed to Unite a set of outline exemptions “from the strike action to explore whether minimum levels of service and support could be maintained to enable ironmaking, steelmaking . . . to continue to operate safely”.

Sharon Graham, Unite general secretary, said Tata’s statement was the “latest in a long line of threats that won’t deter us”.

Unite, added Graham, had “secured serious investment from Labour to safeguard jobs” and called on Tata executives in India to “take hold of this dispute . . . [and] negotiate”.

Labour has promised to cut a better deal for the industry if it wins the general election on July 4.

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IMF says Fed should hold interest rates where they are until ‘at least’ end of year

International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during the 2024 CNBC CEO Council Summit in Washington, D.C. on June 4, 2024. Shannon Finney | CNBC

The Federal Reserve should wait to cut interest rates until “at least” the end of the year, according to the head of the International Monetary Fund. The U.S. is the only G20 economy to see growth above pre-pandemic levels, and “robust” growth indicates ongoing upside risks to inflation, the 190-country agency said.

“We do recognize important upside risks,” IMF Managing Director Kristalina Georgieva said at a press briefing on Thursday. “Given those risks, we agree that the Fed should keep policy rates at current levels until at least late 2024.” The Fed’s current fed funds rate has stood within the range of 5.25% to 5.50% since July 2023.

The IMF, often called the world’s “lender of last resort,” forecasts that the core personal consumption expenditures price index — the Fed’s preferred measure of inflation — will end 2024 at around 2.5% and reach the Fed’s 2% target rate by mid-2025, ahead of the Fed’s own projection for 2026.

U.S. economic strength during the Fed’s rate-hike cycle was aided by labor supply and productivity gains, Georgieva said, while highlighting the need for “clear evidence” that inflation is coming down to the 2% target before the Fed cuts rates.

Nonetheless, the IMF’s “more optimistic” assessment of the downward inflation trajectory is based on indications of a cooling labor market in the U.S. and weakening consumer demand.

“I want to recognize that a lesson we learned from the last [few] years is we are at a time of more uncertainty. This uncertainty also lies ahead. We are confident, however, that the Fed will move through that, and certainly with the same prudence it has demonstrated over the last year,” Georgieva said.

Correction: A previous version of this article misstated Kristalina Georgieva’s name.

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There’s a big Fed inflation reading coming Friday. Here’s what to expect

The personal consumption expenditures price index, an inflation measure the Federal Reserve watches closely, is expected to show little, if any, monthly increase for May. When stripping out volatile food and energy prices, the core PCE price index is set to indicate its lowest annual reading since March 2021. The Commerce Department releases the inflation readings, along with reports on personal income and spending, Friday at 8:30 a.m. ET. People purchase beverages in a store on a sweltering afternoon in Brooklyn, New York, on the first day of summer on June 21, 2024. Spencer Platt | Getty Images

There could be some pretty good inflation news on the way from the Commerce Department when it releases a key economic report Friday.

The personal consumption expenditures price index, an inflation measure the Federal Reserve watches closely, is expected to show little, if any, monthly increase for May, the first time that would be the case since November 2023.

But even more importantly, when stripping out volatile food and energy prices, the core PCE price index, which draws even closer scrutiny from Fed policymakers, is set to indicate its lowest annual reading since March 2021.

If that date rings a bell, it’s when core PCE first passed the Fed’s coveted 2% inflation target during this cycle. Despite a series of aggressive interest rate increases since then, the central bank has yet to wrest the pace of price increases back into its target range.

The official Dow Jones forecasts for Friday’s numbers are for the headline, or all-item, PCE price reading to come in flat on the month, while core is projected to rise 0.1%. That would compare to respective increases of 0.3% and 0.2% in April. Both headline and core are forecast at 2.6% on a year-over-year basis.

Should the core PCE price forecasts transpire, it will serve as a milestone of sorts.

“We are in line with [the forecast] that the PCE core pricing data will come in soft,” said Beth Ann Bovino, chief economist at U.S. Bank. “That’s good news for the Fed. It’s also good for people’s pocketbooks, although I don’t know if people feel it just yet.”

Indeed, while the rate of inflation has receded precipitously from its mid-2022 peak, prices have not. Since that March 2021 benchmark, core PCE is up 14%.

That

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Chewy stock pops 34% after Roaring Kitty posts a dog picture, then gives it all back

A photo illustration of the Chewy logo is seen on a smartphone and a PC screen. Pavlo Gonchar | SOPA Images | Lightrocket | Getty Images

Chewy shares rallied dramatically on Thursday after meme stock leader Roaring Kitty posted a picture on social media platform X that resembles the logo of the online pet food retailer, but the gains were quickly erased later in the session.

Roaring Kitty, whose legal name is Keith Gill, has stirred up trading in speculative names such as GameStop by posting cryptic images and memes online. A picture of a cartoon dog appeared on his X feed Thursday afternoon, briefly driving up Chewy shares as much as 34% to $39.10.

The stock later fell into negative territory again in Thursday’s session, dipping 0.5%.

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There’s also a strong connection between meme stock GameStop and Chewy. GameStop CEO Ryan Cohen was the founder and CEO of Chewy, who was instrumental in PetSmart’s takeover of Chewy in 2017 and its subsequent initial public offering in 2019.

Cohen joined the GameStop board of directors along with two other Chewy executives in January 2021, partly helping fuel the initial GameStop rally. He later took over as GameStop CEO in 2023, leading a turnaround in the brick-and-mortar video game retailer.

Shares in pet retailers such as Chewy and Petco saw big spikes during the pandemic when stuck-at-home consumers adopted cats and dogs in droves. With the adoptions came purchases of needed accessories such as new beds and leashes for their furry family members.

But as the pandemic ended and people began venturing outside again, adoption numbers slowed and consumers had less need for discretionary pet items such as toys and cages, which carry higher profit margins than pet food.

Over the past year or so, Chewy and Petco have seen consistently strong pet food sales, but revenue for higher margin categories has fallen.

Gill is a former marketer for Massachusetts Mutual Life Insurance. He came into the limelight after successfully encouraging retail investors to buy GameStop shares and call options in 2021 to squeeze out short-selling hedge funds. The mania in 2021 led to a series of congressional hearings featuring Gill in brokers’ practices and the “gamification” of retail trading.

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Cocoa prices tumble as African crop fears ease

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SEC’s use of in-house courts curbed by US Supreme Court

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Stocks making the biggest moves midday: Walgreens Boots Alliance, Levi Strauss, International Paper and more

Check out the companies making headlines in midday trading: Walgreens Boots Alliance — The stock plummeted more than 24.5% after the retail company reported third-quarter earnings results that missed Wall Street’s expectations . The company also announced a cut to its full-year adjusted profit outlook and said it would close stores that are underperforming as a way to cut costs. Shares of CVS fell more than 4% in sympathy. Levi Strauss — The denim maker’s stock tumbled 17.1% after revenue came in at $1.44 billion for the second fiscal quarter. That is slightly below the consensus forecast of $1.45 billion from analysts polled by LSEG. International Paper — Shares of the paper manufacturing company fell nearly 8% following the news that Suzano is no longer pursuing a potential acquisition of the company. Suzano said it believes it had reached the maximum price for the transaction to general value without receiving any response from the other party. Hims & Hers Health — The telehealth stock moved 10.3% lower after Hunterbrook Media published a report discussing alleged issues about the company’s sale of weight loss drugs. Hunterbrook Capital, a hedge fund Hunterbook is affiliated with, has a short position in the company’s shares. RH — The furniture company popped 5.6% after it announced that CEO Gary Friedman completed the purchase of $10 million worth of shares at an average of $216.10 per share. He now owns just more than a quarter of all the company’s outstanding shares. Micron Technology — The memory chip stock shed nearly 7% after Micron Technology offered guidance that was roughly in line with expectations. Analysts had been hoping for rosier guidance that topped expectations as artificial intelligence demand continues to boom. AeroVironment — The manufacturer of unmanned aerial vehicles plunged nearly 16% after the company reported EBITDA guidance for its fiscal 2025 year that came in 5% below what analysts had expected, according to FactSet. However, AeroVironment posted a fourth-quarter earnings and revenue beat. Arista Networks — The computer networking stock rose 4.3%. On Thursday, Citi raised its price target to $385 from $330, implying a 15% upside from Wednesday’s close. The bank said Arista Networks will benefit from ethernet’s growing share in the AI networking market. Goldman Sachs — The stock slipped around 2% following the latest results of the Federal Reserve’s stress test

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Why is insider betting even a thing?

Dan Davies is a managing director at Frontline Analysts and an author. His most recent book is The Unaccountability Machine, which you can buy here and read about here, here, here and here.

The last two weeks have given UK voters reason to wonder whether British elections are regulated by the Electoral Commission or by the Gambling Commission. Several constituencies have effectively lost candidates as a result of investigations into whether they placed bets on the timing of the election based on inside knowledge, or whether they made “hedge” bets on an opponent to win.

Things have already been escalated to the Metropolitan Police. Anyone familiar with financial market regulation might be inclined to ask — why is the betting industry protected by such aggressive and proactive regulation?

For one thing, the amounts of money involved seem to be pretty trivial. Try calling up the FCA and saying you’ve got evidence of £100 worth of insider trading but it needs to be investigated this week and can’t wait; see how you get on.

There’s also a reasonable question to be asked as to why “insider betting” should be an offence at all. The ability to have someone sent to prison for being better informed than you is a very great privilege indeed, and it’s not obvious what the bookmakers have done to deserve it.

It’s hard to believe today, but in many countries “insider trading” was not a crime until quite recently. It has been prohibited in the US for most of the 20th century but was only banned in the UK in 1980, and wasn’t a criminal offence in New Zealand until 2008.

In Lying for Money, my book about fraud, I argued that this was because insider trading is a “market crime”. Rather than being something that’s obviously against natural justice, it’s a convention or internal rule of a particular industry that’s found its way on to the statute book because that industry is so big and important.

Insider trading is not like stealing or counterfeiting; there is no Commandment which reads, “Thou shalt not use thy private information”. In most industries, finding out things that the customer doesn’t know and using this to gain an advantage is the epitome of good business. I don’t complain that my greengrocer knows more than me about the wholesale price of oranges. When I’m buying a house or a second-hand car, I accept that the vendor is