The daily business briefing: June 1, 2022
Biden and Powell discuss plans to fight inflation, Shanghai lifts most COVID-19 restrictions, and more
Biden, Powell discuss plans to fight inflation
President Biden met Tuesday with Federal Reserve Chair Jerome Powell to discuss Biden's plan to fight high inflation, which he explained in a Wall Street Journal op-ed on Monday. Biden said bringing down inflation had become his top domestic priority and that he would not "interfere" in the Fed's role in containing rising prices. "My plan to address inflation starts with the simple proposition: Respect the Fed, respect the Fed's independence, which I have done," Biden told reporters during his meeting with Powell, who was recently confirmed to a second term. Republicans blame Biden for inflation and the threat of a recession. Biden says the root of the problem is Russia's invasion of Ukraine, which has driven up oil prices.
Shanghai eases COVID-19 restrictions after 2-month lockdown
Shanghai Vice Mayor Zong Ming said full bus and subway service, and rail connections to other parts of China, would be restored Wednesday as the country's largest city reopens after a two-month COVID-19 lockdown that has damaged China's economy and worsened supply-chain problems around the world. Schools will partially reopen. Shopping malls, supermarkets, pharmacies, and convenience stores will reopen slowly, at up to 75 percent of capacity. Movie theaters and gyms will remain closed. "The epidemic has been effectively controlled," Zong said. Officials said in early May they were aiming for a June 1 reopening.
Economic confidence falls to lowest point since 2009
Americans' economic confidence fell in May to its lowest point since early 2009, when the Great Recession was ending, according to Gallup's Economic Confidence Index. The index measures Americans' perceptions of current economic conditions and the economy's future. Possible scores range from +100 (if all say the economy is excellent or good and improving) to -100 (if all say it is poor and worsening). The ECI hit -45 in May, down from -39 in March and April. Twenty percent of respondents said the economy was improving; 77 percent said it was getting worse. In Feb. 2020, before COVID-19 lockdowns, the ECI stood at +41. The lowest score on record is -72 in 2008.
Unilever gives activist investor Nelson Peltz a board seat
Unilever is adding activist investor Nelson Peltz to its board as it faces intensifying pressure to restore sales growth as its stock price slipped this year, The Wall Street Journal reported Tuesday. Peltz's Trian Fund Management is one of the Dove soap and Hellmann's mayonnaise maker's biggest investors, with a 1.5 percent stake. Peltz said Tuesday he wanted to work with the company to tap "significant potential." Peltz has served on boards at Procter & Gamble, Kraft Heinz Co., and Oreos maker Mondelez International. Unilever Chairman Nils Andersen said Peltz's experience with consumer goods companies would be helpful to Unilever's board.
Dow, S&P futures rise ahead of new month
Futures tied to the Dow Jones Industrial Average and the S&P 500 rose slightly early Wednesday ahead of the start of June trading. Dow futures were up 0.4 percent, and S&P 500 futures were up 0.1 percent at 6:30 a.m. ET. Nasdaq futures were down 0.1 percent. All three of the main U.S. indexes fell Tuesday as May closed with choppy trading. The Dow and the S&P 500 fell 0.7 percent and 0.6 percent, respectively. The tech-heavy Nasdaq lost 0.4 percent. The Dow and the S&P 500 snapped long losing streaks last week and finished May little changed. The Nasdaq dropped 2 percent on the month as high inflation and looming interest-rate hikes fueled uncertainty.