The daily business briefing: July 6, 2021
Oil prices rise after OPEC cancels meeting on production hike, global stocks rise to record territory, and more
Oil prices jump after OPEC cancels meeting on raising production
Oil prices surged on Monday after OPEC canceled a meeting many hoped would result in a deal to increase production to meet rising demand. The price of benchmark Brent crude, which is up about 50 percent in 2021, rose by 1 percent to more than $77 a barrel. OPEC did not say whether a new date for the meeting had been set. The news came after Americans traveling for the Fourth of July weekend paid gasoline prices that were at a seven-year high, increasing inflation pain as companies reopen after coronavirus-shutdowns and struggle to keep up with demand. The average U.S. price of a gallon of gas is $3.13, an increase of 95 cents or 44 percent from a year ago, when the pandemic was spreading and restrictions were widespread.
Global stocks rise to records as business activity expands in Europe
Global stocks closed at or near record highs on Monday as investors reacted to spiking business activity in Europe and a promising U.S. jobs report. The gains were kept in check by concerns about the spread of the highly transmissible Delta variant of the coronavirus. The STOXX index of 600 leading European companies opened lower but closed up by 0.3 percent after data showed euro zone business activity expanded in June at the fastest clip in 15 years. Britain's FTSE gained 0.5 percent ahead of U.K. Prime Minister Boris Johnson's announcement that his government would end mask requirements and restrictions on gatherings in England starting July 19.
Tech giants warn Hong Kong over data-protection law
Facebook, Twitter, and Google warned Hong Kong they would stop serving the Asian financial hub if its government went ahead with data-protection laws that would hold them responsible for doxing, or malicious sharing of people's information online, The Wall Street Journal reported Monday. The Singapore-based Asia Internet Coalition, an industry group that includes the internet giants, told Hong Kong's government in a previously unreported June 25 letter that the planned rules could expose their employees to criminal charges based on what users post, and the only way to avoid them was "to refrain from investing and offering services in Hong Kong." The Hong Kong Constitutional and Mainland Affairs Bureau proposed the measures in May to prevent doxing, which became common during a wave of 2019 pro-democracy protests.
Stock futures struggle at start of holiday-shortened week
U.S. stock futures were little changed early Tuesday as the S&P 500 sits at a record high following a seven-day winning streak. The S&P 500, the Dow Jones Industrial Average, and the tech-heavy Nasdaq were flat several hours before the opening bell at the start of a trading week shortened by the long July 4 weekend. Wall Street got a boost on Friday from a strong jobs report. The Bureau of Labor Statistics reported that U.S. employers added 850,000 jobs in June. Economists surveyed by Dow Jones had expected a gain of 706,000. Stocks have surged as the economy reopened after coronavirus shutdowns, but some analysts expect choppier gains the rest of the year.
Volkswagen gives up control of Bugatti
Volkswagen said Monday that it was it was transferring control of hypercar maker Bugatti to a joint venture between VW's Porsche unit and Rimac, a young Croatian company that does designing and engineering for large automakers. Porsche will own 45 percent of the joint venture. Rimac will own 55 percent, and its founder, 33-year-old Mate Rimac, will serve as CEO. Volkswagen bought Bugatti out of bankruptcy in 1998, years before it acquired Porsche. The deal was part of the legacy of Ferdinand Piech, who built VW into a global empire. But the two companies were never considered a logical fit. VW is better known for popular, economical vehicles such as Golfs and Passats, while Bugatti makes cars like the Chiron, which starts at nearly $3 million.