The daily business briefing: May 3, 2022
Amazon workers reject fledgling union at N.Y. warehouse, 10-year Treasury yields hit 3 percent, and more
Amazon workers reject union push at N.Y. warehouse
Amazon workers have voted down a proposal to unionize at a second warehouse on New York's Staten Island, according to the Monday vote count. The 618 to 380 vote, conducted over four days last week, marked a setback for the Amazon Labor Union. The union was formed by a former warehouse supervisor, Chris Smalls, and co-worker Derrick Palmer, who got workers at a massive Staten Island fulfillment center to vote in favor of the union last month. At that warehouse, the first Amazon facility to unionize, 55 percent of those voting backed the nascent union. The vote at the second warehouse came as Amazon announced that it was ending its COVID-19 sick leave policy, which gave staffers infected with the coronavirus 10 paid days off. Now staffers will get up to five unpaid but excused sick days.
10-year Treasury yield reaches 3 percent
The 10-year Treasury yield, which rises when bond prices fall, reached 3 percent on Monday for the first time since 2018. The yield rose as high as 3.008 percent before settling at 2.995 percent, up from 2.885 on Friday. The surge came as the Federal Reserve prepared to start a two-day policy meeting on Tuesday that is expected to end Wednesday with a half-percentage-point interest rate increase to help fight the highest inflation in decades. Bond prices have fallen this year in anticipation of the Fed's efforts to roll back the near-zero interest rates and bond purchases it has used to boost the recovery from the economic damage of the coronavirus pandemic.
European Commission says Apple broke antitrust laws
European Union regulators on Monday accused Apple of breaking antitrust laws by unfairly boxing out competitors of its Apple Pay payment service, The New York Times reported. The European Commission says Apple abused its dominance by denying PayPal and other rivals access to its Apple Pay technology in the iPhone and Apple Watch. The U.S. tech giant could be fined up to 10 percent of its global revenue in the case, although Apple also could reach a settlement with regulators. Apple will have an opportunity to respond before any final judgment on the charges, which Margrethe Vestager, the European Commission executive vice president in charge of antitrust enforcement, announced in Brussels.
Fed starts 2-day meeting expected to end with half-point rate hike
The Federal Reserve on Tuesday starts a two-day policy meeting expected to conclude with a half-percentage-point interest rate hike. The Fed has telegraphed the move as part of its accelerating efforts to fight inflation, which has surged to a 40-year high. A half-point increase would be the central bank's sharpest hike since 2000. The Fed is expected to follow up with another half-point hike at its next meeting, in June. Another could come in July, with further increases later in the year. Economists also expect the Fed to announce that it will start reducing its Treasury and mortgage-bond holdings, which it piled up as it pumped money into the economy to boost the recovery from the pandemic-induced 2020 recession.
Stock futures lower after May trading starts with wild swings
U.S. stock futures fell slightly early Tuesday after starting May trading Monday with a modest rise amid wild fluctuations. Futures for the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were down by about 0.3 percent at 6:45 a.m. ET. On Monday, the three main indexes fell sharply in early trading but pulled off a major reversal. The Dow Jones Industrial Average gained 84 points, or 0.3 percent, after falling by more than 400 points. The S&P 500 rose 0.6 percent after touching its lowest point of 2022. The tech-heavy Nasdaq fell by as much as 1.1 percent before recovering, and ending the day up by 1.6 percent. The volatile day followed big losses in April.