Tesla hopes new investors will hit the road after the stock split
NEW YORK – Unlike its cars, Tesla’s stock is about to become less expensive. Tesla is splitting its stock 3 for 1, so after the close of trading on Tuesday, investors will receive two additional shares of Tesla for every share they owned as of August 17. In theory, that should cut Tesla’s share price by about two-thirds before trading begins Wednesday at around $290. Stock splits don’t make a company more valuable or more profitable, but the hope is that the stock looks affordable to more investors. Tesla joins stock market heavyweights Amazon and Google parent Alphabet in splitting their shares at a premium this year.
Whistleblower accuses Twitter of cyber security negligence
SAN FRANCISCO — A former Twitter security chief alleged the company misled regulators about its lax cybersecurity protections and its negligence in trying to root out fake accounts spreading misinformation, according to a whistleblower complaint filed with officials Americans. Peiter Zatko, Twitter’s chief security officer until he was fired earlier this year, filed complaints last month with the US Securities and Exchange Commission, the Federal Trade Commission and the Justice Department. A whistleblower group said Zatko has exhausted all efforts to resolve his concerns within the company. Some members of Congress are calling for an investigation.
Stocks fall as steady yields soothe Wall Street after decline
NEW YORK — Stocks edged to modest losses on Wall Street as steady Treasury yields helped calm the market after its worst decline in months. The S&P 500 fell 0.2% on Tuesday. The lower drop follows Monday’s sharp 2.1% drop, which came at the end of the first losing week in the past five. Volatility has returned to Wall Street after what had been a strong summer, as concerns grow about how aggressively the Federal Reserve will raise interest rates. Recent comments from Fed officials have dampened hopes for a less powerful Fed. Yields were mixed on Tuesday after some weaker-than-expected readings on the economy.
New electric vehicle tax credits raise trade war talk
WASHINGTON — A new tax credit for U.S. buyers of qualifying electric vehicles made in North America in the Inflation Reduction Act has prompted accusations of unfair trade practices overseas. The climate change and health care bill was signed into law last week. It includes a tax credit of up to $7,500 that can be used to offset the cost of purchasing an electric vehicle. The vehicle must contain a battery built in North America with 40% of metals mined or recycled on the continent. The European Commission says the new tax credit discriminates against foreign producers and calls the credits a “potential new transatlantic trade barrier”. And battery rules tighten over time, with only a few American manufacturers able to produce vehicles that would qualify.
The Biden administration projects a deficit of $1.03 billion, down $400 billion
WASHINGTON – The Biden administration is projecting that this year’s budget deficit will be nearly $400 billion lower than it estimated in March, in part because of stronger-than-expected revenues, reduced spending and an economy that has recovered all the jobs lost during the multi-year pandemic. Overall, this year’s deficit will fall by $1.7 trillion, representing the largest single nominal decline in the federal deficit in American history, the Office of Management and Budget says. Despite the gains, the administration said Tuesday it is projecting a $1.03 trillion deficit for the budget year ending Sept. 30. That number marks a move away from the record deficit in 2020, which reached $3.13 trillion.
Macy’s, Nordstrom cut profit views along with inventories
NEW YORK – Nordstrom has joined Macy’s in lowering its annual profit and sales outlook, despite second-quarter results that topped Wall Street forecasts. Both retailers are suffering from an affliction that plagues most of their competitors: A glut of unsold inventory that they’re using deeply discounted prices to move. Almost every major retailer has said in recent weeks that shoppers are making fewer trips to the store, and when they do, they’re looking for deals. Some are trading in cheaper alternatives. Kohl’s last week lowered sales and profit expectations for the year as a result of increased price cuts to remove unwanted merchandise. Both Target and Walmart also said last week that shoppers are cutting back and sticking to essentials.
Yelp to add more flags to anti-abortion pregnancy centers
SAN FRANCISCO – Online review site Yelp said Tuesday it is launching a new feature to protect users seeking abortions from being misled about anti-abortion pregnancy centers listed on its platform. Such centers usually have religious affiliations and prevent clients from obtaining abortions. On Tuesday, Yelp said it will place a consumer notice on the listings informing users that the centers “typically offer limited medical services and may not have licensed medical professionals on site.” In 2018, moderators for the San Francisco-based company began recategorizing listings for organizations such as “crisis pregnancy centers” or “faith-based crisis pregnancy centers.” The organizations had previously categorized themselves as reproductive health services and medical centers, among others.
The S&P 500 fell 9.26 points, or 0.2%, to 4,128.73. The Dow Jones Industrial Average lost 154.02 points, or 0.5%, to 32,909.59. The Nasdaq eased 0.27 points, or less than 0.1%, to 12,381.30. The Russell 2000 index of smaller companies rose 3.40 points, or 0.2%, to 1,919.14.