A Bernanke bump, a drop in initial jobless claims, and Dell's postponement of a vote to go private top our roundup of the day's top business news stories.
Jobless Claims Dropped More than Expected
Although summer figures are considered less reliable than at other times of the year, initial jobless claims dropped last week to the lowest level in four months, the Labor Department announced Thursday. Initial claims for state unemployment benefits fell to a seasonally adjusted 334,000, a drop of 24,000. The four-week moving average of new claims for unemployment fell 5,250 below the previous week’s four-week total. Summer unemployment numbers can be skewed by the fact that many factories retool during the period in preparation for new products and there are frequent hirings and firings or layoffs.
Markets Feel the Bernanke Bump
The stock market closed slightly higher Wednesday following Federal Reserve Chairman Ben Bernanke’s testimony before Congress that the U.S. central bank had no firm timetable for tapering its bond purchases. Bernanke said that the Fed would consider reducing its stimulus program if the economy improves, but that reductions were “by no means on a preset course.” Investor concerns that the Fed was poised to start easing back on that stimulus before the economy had recovered sufficiently has caused fluctuations in the stock market. The Standard & Poor's 500 index climbed 0.3 percent, to 1,680.91. Its all-time intraday high, reached on May 22, was 1,687. The S&P is up 17.9 percent year-to-date.
Del Postpones Shareholder Meeting to Consider Buyout
A vote scheduled for Thursday on Dell founder Michael Dell's plan to take the slumping computer maker private has been rescheduled for July 24, a sign the board needs more time to rally support, CNBC reports. A special shareholders meeting at the company's headquarters in Round Rock, Texas was called to order and then quickly adjourned. Analysts believe Michael Dell might have to sweeten the bid to get the deal done. Investor Carl Icahn has stated he believes the offer undervalues the company and other big investors have indicated their opposition to the bid. The company's decision to go private is a reflection of the tough times facing the personal computer industry as people delay replacing traditional computers and spend their money instead on the latest smartphones and tablets, CNBC stated. Tablets are expected to outsell laptops this year.
Student Loan Rates Could Get Reduced before the School Year Begins
A bipartisan panel of senators Wednesday got closer to a compromise plan that would reduce student loan rates again and there could be action before the new school year begins. The senators met with President Barack Obama to discuss the details of the deal that could keep loan rates down through the 2015 academic year before yet another loan rate raise would occur. On July 1 the rates on federally subsidized Stafford loans jumped from 3.4 percent to 6.8 percent, and an immediate effort was made to reduce the rate again while the economy continues to recover.
Is China the world’s leading superpower now?
A new Pew Research Center study indicates the world believes China is going to overtake the United States as the world’s leading superpower. From a survey of 38,000 people from 39 countries, Pew said the results from 33 countries indicated China is going to supplant the United States. "Publics around the world believe the global balance of power is shifting," Pew wrote. "China's economic power is on the rise, and many think it will eventually supplant the United States as the world's dominant superpower." Two-thirds of Chinese residents believe China will overtake the United States, while 47 percent of Americans believe it will happen. That is an 11-percentage point jump since the last survey in 2008.
The Colonel Wants Millennials
KFC is taking a page out of the Panera Bread playbook and will be testing a fast-casual restaurant to appeal to more health conscious Millennials, USA Today reports. The flagship restaurant, scheduled to open Aug. 5, will be located near the company’s headquarters in Louisville and will feature such items as flatbread sandwiches, salads, and smoothies. The iconic Colonel Sanders will not be featured on the marquee or signage. The new restaurant is the latest effort for the fried chicken kingpin to become more relevant to younger customers. It recently introduced a boneless incarnation of its signature fried chicken. Fast-casual restaurants are the fastest growing segment in the industry, with sales increasing 13.21 percent in 2012, USA Today reports.