The daily business briefing: August 19, 2021
Fed minutes show debate on pulling back on stimulus, a judge blocks ConocoPhillips Alaska oil permits, and more
Fed minutes show officials considering reducing stimulus
Federal Reserve policy makers are considering dialing back their efforts to boost the economy later this year, according to minutes from the Fed's late-July meeting that were released on Wednesday. Fed leaders are nearing a consensus on trimming the central bank's $120 billion in monthly purchases of Treasury and mortgage securities at one of their remaining three 2021 policy meetings, the July minutes indicated. "Most participants noted that, provided that the economy were to evolve broadly as they anticipated, they judged that it could be appropriate to start reducing the pace of asset purchases this year," the minutes said. Some officials were more cautious, suggesting the Fed should wait until next year to make sure the job market has fully recovered from the damage of the coronavirus pandemic.
Judge blocks permits for Alaska oil project
U.S. District Judge Sharon Gleason on Wednesday blocked permits approved by the Trump administration and backed by the Biden administration for ConocoPhillips' Willow project to extract oil from Alaska's North Slope. Gleason — an Obama appointee — found that the Bureau of Land Management and the U.S. Fish and Wildlife Service failed to adequately assess the project's climate impact and other environmental factors, including how it could harm polar bears, a threatened species. The decision marked a significant setback for the project, which could produce up to 160,000 barrels of oil per day west of Prudhoe Bay in the Alaskan Arctic. Environmental activists praised the decision, which ConocoPhillips said it would review as it evaluates potential changes to the project.
T-Mobile says breach exposed data of 40 million credit applicants
T-Mobile said Wednesday that a recent data breach exposed the names, Social Security numbers, and driver's license information of more than 40 million people who applied for T-Mobile credit. Similar data for 7.8 million T-Mobile monthly cellphone service customers was also likely compromised. T-Mobile has faced data theft problems before, but "the sheer numbers far exceed the previous breaches," Gartner analyst Paul Furtado said. T-Mobile became one of the nation's largest mobile phone carriers alongside AT&T and Verizon last year when it bought rival Sprint, giving it 102 million customers. "Yes, they have a big target on their back but that shouldn't be a surprise to them," Furtado said.
Stock futures fall further after Wednesday's losses
U.S stock index futures dropped sharply early Thursday following Wednesday's selloff. Futures for the Dow Jones Industrial Average were down by 1 percent several hours before the opening bell. Futures for the S&P 500 and the Nasdaq fell by 0.9 percent and 0.8 percent, respectively. On Wednesday, the Dow and the S&P 500 fell by nearly 1.1 percent. The tech-heavy Nasdaq dropped by 0.9 percent after the release of Federal Reserve minutes indicating that leaders at the central bank are considering reducing monthly bond purchases they have been using to support the economic recovery from the coronavirus crisis. As the Fed tapers its economic stimulus efforts, said Sean Bandazian, an investment analyst at Cornerstone Wealth, there could be "volatility throughout areas of the market with high sensitivity to interest rates."
Goldman Sachs to buy NNIP for about $2 billion
Goldman Sachs said Thursday it would buy the asset management operations of Dutch insurer NN Group for about $2 billion. The deal is Goldman's biggest since David Solomon took over as chief executive in 2018 and started trying to make the bank less dependent on revenue from trading and advising on deals by expanding its wealth management and international operations. "This acquisition allows us to accelerate our growth strategy and broaden our asset management platform," Solomon said in a statement. NN Investment Partners has $335 billion in assets under management, so the acquisition will double the assets Goldman Sachs manages in Europe to more than $600 billion. Numerous other financial firms have expanded operations in the Netherlands since Britain left the European Union.