The daily business briefing: July 27, 2021
Bezos' Blue Origin offers to cover $2 billion in lunar lander costs, new home sales fall unexpectedly, and more
Bezos offers NASA $2 billion for lunar lander contract
Jeff Bezos said Monday in a letter to NASA Administrator Bill Nelson that his space company, Blue Origin, would waive up to $2 billion in payments in the first two years of production if NASA awards the company a moon lander contract. Blue Origin also offered to finance a pathfinder mission and negotiate a fixed-price contract protecting the U.S. space agency from cost overruns. NASA awarded the contract for the Human Landing System program to Elon Musk's company, SpaceX, in April, but suspended the arrangement in May following a protest by Blue Origin calling the $2.9 billion deal "unfair." Before awarding the contract, NASA had given 10-month contracts to SpaceX, Blue Origin, and Dynetics to start developing lunar landers so it could pick from several options.
New home sales unexpectedly fall in June
Sales of newly built homes fell in June to their lowest level since April 2020 early in the U.S. coronavirus crisis, according to data released by the U.S. Census Bureau on Monday. Sales of new single-family homes dropped to an annualized rate of 676,000, down 6.6 percent from May and 19.4 percent lower than in June 2020. Analysts were expecting a 3.4 percent increase. More than a year of frenzied home-buying has pushed up prices by double-digits, leaving new homes out of reach for many prospective buyers. One reason for the high prices is high construction costs. Softwood lumber prices shot up by more than 300 percent during the pandemic. The price fell in the last month, but remains 75 percent above 2019 prices.
Senators, White House continue infrastructure talks after deadline passes
Democratic and Republican senators and the White House held high-stakes negotiations on Monday, hoping to save a $1 trillion bipartisan infrastructure deal. The bipartisan group of senators has been conducting closed-door discussions for weeks, but failed to finalize an agreement before a Monday deadline. Sticking points include how much to spend on public transit and water infrastructure, and whether projects to upgrade roads, bridges, broadband, and other priorities would be covered under federal wage requirements. The two sides also have disagreed over whether some of the money can come from unspent COVID-19 funds. "This is heading in the right direction," Republican negotiator Sen. Rob Portman (Ohio) said.
California, NYC to mandate vaccines for government employees
California and New York City on Monday announced that they would require government workers to get coronavirus vaccines or be tested for COVID-19 weekly. The moves mark the "opening of the floodgates," with more governments and companies expected to follow with their own vaccine mandates as the national vaccination push stalls due to widespread resistance, said Dr. Ashish Jha, dean of Brown University's School of Public Health. The Department of Veterans Affairs on Monday became the first major federal agency to impose a vaccine mandate on health-care workers. St. Louis became the second major city, after Los Angeles, to order a new mandate requiring people to wear face masks indoors, whether they are fully vaccinated or not.
U.S. stocks close at record highs, but futures fall
U.S. stocks edged higher on Monday to close at record highs at the start of a busy week of quarterly earnings reports from tech giants. The Dow gained 0.2 percent after closing above 35,000 for the first time on Friday. The S&P also rose by 0.2 percent. The tech-heavy Nasdaq inched up by 0.03 percent. Electric-car maker Tesla started the flurry of high-profile results when it reported record earnings after the closing bell, sending its stock rising by 1 percent in after-hours trading. Apple, Amazon, and Google parent Alphabet report after the closing bell Tuesday. Stock futures fell early Tuesday. The Dow and the S&P 500 were down by 0.4 percent and 0.3 percent, respectively, several hours before the opening bell.