The daily business briefing: May 24, 2021
Bitcoin selloff resumes as prices fall by 13 percent, stock futures rise after S&P 500's second straight week of losses, and more
Bitcoin falls by 13 percent as selloff resumes
The bitcoin selloff resumed on Sunday, with the volatile cryptocurrency dropping by 13 percent. Ether, the cryptocurrency linked to the ethereum blockchain network, fell by 17 percent. Bitcoin has been through dramatic price swings recently, and it came under renewed pressure last week after Tesla CEO and longtime cryptocurrency booster Elon Musk posted a series of tweets in which he said the electric-car company was reversing plans to accept bitcoin as payment. "Many point to bitcoin's volatility as untenable," wrote RBC Capital Markets' Amy Wu Silverman in a research note published over the weekend. "Indeed, Bitcoin makes severe and dizzying swings."
Stock futures rise after last week's losses
U.S. stock index futures gained early Monday, struggling to bounce back after Wall Street's second straight week of losses. Futures tied to the Dow Jones Industrial Average were up by 0.4 percent several hours before the opening bell. S&P 500 and Nasdaq futures rose by 0.5 percent and 0.7 percent, respectively. The Dow fell last week for the fourth negative week in the last five, while the S&P 500 had its second straight down week. Several retail companies report earnings this week. Some analysts expect more rough days ahead as concerns about inflation and the economic recovery from the coronavirus pandemic continue. "We think the choppy/sideways trend will continue for a bit longer, and the market will experience sell-off scares along the way," said Adam Crisafulli, founder of Vital Knowledge.
Reuters poll: House price inflation rate to rise
U.S. house prices are expected to continue rising this year, even faster than forecast three months ago, according to a poll of analysts Reuters released Monday. The S&P CoreLogic Case-Shiller 20-metro-area house price index has risen steadily over the last year, averaging 11 percent this year. Reuters' May 11-24 poll of 40 property analysts found that house prices were expected to gain at an average 10.6 percent pace this year, nearly twice the 5.7 percent forecast in February. That would be the fastest annual house-price increase since 2013. "The housing market is in line with fundamentals as interest rates are attractive and incomes are high due to fiscal stimulus, making debt servicing relatively affordable and allowing buyers to qualify for larger mortgages," said Nathaniel Karp, chief U.S. economist at BBVA.
Ever Given owner blames Suez Canal Authority for blockage
The Japanese company that owns the Ever Given — the container ship that blocked Egypt's Suez Canal in March — blamed the Suez Canal Authority for the incident, a lawyer for the company said over the weekend. Lawyers for the company, Shoei Kisen Kaisha, said the canal authority was at fault because it let the ship enter the canal despite poor weather conditions. The Ever Given became wedged between the canal's banks, and blocked traffic through the vital waterway from March 23 to March 29, delaying about 400 ships and disrupting global supply chains. The ship has been held in an artificial lake along the canal pending talks on compensation for Egypt's losses. The Ever Given's owners now are seeking $100,000 for losses stemming from the ship's detainment.
Senators agree on bipartisan proposal to hike funding for roads, bridges
A bipartisan group of senators unveiled a transportation proposal over the weekend seeking a 34 percent increase in funding for highways, roads, and bridges. The legislation package released by the Senate Environment and Public Works Committee would bring baseline spending on the basic infrastructure to $300 billion over five years. The agreement came as Congress tries to work out compromises between Republicans and Democrats on repairing U.S. infrastructure. The White House on Friday cut its original $2.3 trillion infrastructure proposal to $1.7 trillion as a counteroffer to Republican senators, who released a $568 billion infrastructure proposal in April. The office of the Senate committee's ranking member, Sen. Shelley Moore Capito (R-W.Va.), said in a press release that the White House proposal was still "well above the range" of what Republicans would accept.