Business briefing

The daily business briefing: August 8, 2019

FedEx stops providing ground shipping for Amazon, immigration agents arrest 680 in Mississippi workplace raids, and more

1

FedEx to stop ground shipping for Amazon

FedEx announced Wednesday that it would let its contract to provide ground shipping for Amazon expire at the end of August. FedEx said recent moves boosting its delivery network would set up the company "extraordinarily well" to "focus on the broader e-commerce market." Amazon has used FedEx's ground delivery service for years to get packages to its customers. The shift came after Amazon's recent push to develop its own delivery network, threatening delivery companies with its own air cargo fleet and contractors driving their own delivery trucks. FedEx dropped Amazon as an air-cargo customer in June, saying it had ample other e-commerce opportunities. A FedEx spokesperson in June said the average daily volume for small parcels in the U.S. is expected to double over the next seven years.

2

680 arrested in workplace immigration raids in Mississippi

U.S. immigration agents arrested 680 workers, most of them Hispanic, in Wednesday raids on seven Mississippi food processing plants. The raids, the largest such workplace operations in at least a decade, occurred hours before President Trump visited El Paso, Texas, a majority Latino city on the Mexican border where a mass shooter killed 22 people over the weekend shortly after posting an online rant against a "Hispanic invasion." Workers arrested at a Koch Foods plant in Morton were taken to a military hangar for procession on immigration charges. Dozens of relatives and other supporters gathered nearby and shouted, "Let them go!" Matthew Albence, U.S. Immigration and Customs Enforcement's acting director, said the raids were "being done on a racially neutral basis," based on evidence.

3

Flight to safety sends bond yields to multi-year lows

Investors rushed to buy government bonds on Wednesday as trade tensions continued to rattle the stocks and other risky assets. The flight to safety drove down the yield on the 10-year Treasury note as low as 1.595 percent, the lowest in nearly three years. The 10-year Treasury note is used as a benchmark for mortgage rates and car loans, making it extremely important for consumers. The 30-year Treasury bond's yield fell as low as 2.12 percent, near a 2016 all-time low. Yields edged up from their lows for the session, and remained stabilized early Thursday near their lowest levels in several years. Bond yields move inversely to their prices, so they fall when rising investor demand for Treasurys pushes up prices.

4

Lyft, Uber shares rise on signs of easing price war

Lyft said Wednesday that its price war with ride-hailing rival Uber was simmering down. The news sent shares of both companies rising. Lyft gained 5 percent and Uber rose by 3.8 percent in after-hours trading. Lyft also said its third-quarter sales would rise thanks to increased revenue per rider, which also lifted its full-year outlook above analysts' expectations. "We believe these price adjustments are an industry trend," Chief Financial Officer Brian Roberts told analysts in a call after the company released its quarterly results. He said 2018 probably marked the company's peak losses. Previously, it had said it expected to hit its biggest losses in 2019. Lyft said it lost $2.23 per share in the latest quarter, worse than the $1.74 per-share loss analysts expected.

5

U.S. stocks rebound after latest plunge

The Dow Jones Industrial Average climbed back from a 589-point drop to close up by just over 22 points, or 0.1 percent, as trade-war fears continued to cause market turmoil. The broader S&P 500 also rose by 0.1 percent, after rebounding from a drop of nearly 2 percent. The tech-heavy Nasdaq gained nearly 0.4 percent with a boost from Apple, after falling by as much as 1.7 percent earlier in the day. U.S. stock index futures made modest gains early Thursday as bond yields stabilized after falling as investors sought safe assets, and concerns about economic growth eased after China reported better-than-expected trade data. Futures for the Dow were up by 0.1 percent, while those of the S&P 500 and the Nasdaq gained 0.2 percent and 0.3 percent, respectively.

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