Jobless rates rise, the economy expands, and GM probes. Read about these and more in our roundup of the day's top business news stories.
Jobless Claims Rise by 8,000
The number of Americans filing new claims for unemployment benefits last week increased 8,000 to a seasonally adjusted 312,000. The four-week moving average, a less volatile number that flattens out week-to-week fluctuations in the data, fell 2,250 to 310,250, the lowest level since June 2007. There were no special factors influencing the state level data, the Labor Department said. The total number of people claiming benefits in all programs for the week ending May 17 was 2,513,302, a decrease of 40,279 from the previous week. There were 4,637,937 persons claiming benefits in all programs in the comparable week in 2013. Jobless claims have been volatile in recent weeks because of problems seasonally adjusting the data around moving holidays such as Easter and Passover, but they have continued to suggest the jobs market was strengthening, Reuters reports.
Fed Report Finds U.S. Economy Expansion
The U.S. economy expanded in all 12 Federal Reserve bank districts in the past six weeks, the Federal Reserve said Wednesday. The Fed's Beige Book, named for the color of its cover, marked an improvement over the previous edition, which had 10 regions expanding, The Associated Press reports. The Beige Book provides an anecdotal reading of the economy that often can foretell broader market-moving reports. The Fed scrutinizes the report as it considers whether to raise or lower interest rates. New car sales were "robust" across much of the nation, but other types of retail activity amounted to a mixed bag. Tourism and manufacturing also accelerated. "Lingering cold and wet weather was cited as somewhat of a negative factor in the Boston and New York districts," the Beige Book said. Several areas also said the late Easter, combined with the late arrival of warm weather, had the effect of delaying the spring shopping season.
GM to Release Internal Probe Findings on Switch Failure
General Motors Co is expected on Thursday to release the findings of its internal probe into the company’s actions regarding a defective ignition switch linked to at least 13 deaths. The No. 1 U.S. automaker will hold a company town hall for Chief Executive Mary Barra, followed by a news conference and a call with analysts to provide an update on the faulty switch, which was discovered by engineers in 2001 and resulted in the recall of 2.6 million cars, and the investigation into why a recall was not sought earlier.
Job Cuts Highest in More Than a Year
A payroll report for May showed that job cuts rose to the highest level in more than a year. According to a report by Challenger, Gray and Christmas, U.S.-based employers announced plans to cut payroll by a total of 52,961 in May. The May numbers were up 31 percent from the 40,298 announced layoffs in April. It was also the largest one-month total of job cuts since February of 2013. The job cuts total was 46 percent higher than the 34,000 job cuts announced in May of 2013. The total job cuts announced for the year are 214,500, 2.3 percent lower than the total for the first five months of 2013. The heaviest amount of cuts occurred in the technology sector, with Hewlett-Packard announcing plans to cut as many as 16,000 workers.
Wal-Mart Stores Inc. Expanding Savings Catcher Price Match Tool
Wal-Mart announced Wednesday it is expanding its online tool, Savings Catcher that allows price comparisons on thousands of products with some of its competitors to cities nationwide in the next few months, The Associated Press reports. The world’s largest retailer also plans to offer thousands more products, from general merchandise like TVs and shirts to veggies and other produce on Savings Catcher, which will be available for use on Wal-Mart’s mobile app.
Unlike other retailers’ price match programs, Savings Catcher does the legwork for the consumer. To use the tool, a customer sets up an online account, logs onto Savings Catcher and types in the number on their receipt. Savings Catcher compares prices of every item on the receipt to a database of advertised prices of competitors that's provided by an undisclosed third party. Wal-Mart's prices are matched to stores based on geographic location. Any difference in price is put on a Wal-Mart online gift card. Customers can accumulate savings or use the credit immediately.
Sprint and T-Mobile Agree to Consolidate
Sprint and T-Mobile, the third and fourth largest wireless phone companies, have agreed to terms on a deal to become one company. The deal has been put off for years due to concern over scrutiny from antitrust regulators, but the telecom business has seen a number of consolidations in recent years. Under the terms of the deal, Sprint would acquire T-Mobile for $32 billion, or about $40 a share in cash and stock, which would be a 17 percent premium on Wednesday’s stock price. Talks are not yet fully complete, but the announcement of the agreement seems to be a positive sign. The deal was prompted by the continued growth of the top two wireless providers, Verizon and AT&T.
Fiat Provides a Bargain
Fiat, the Italian automaker, is boosting sales of its luxury Maserati brand by adding a new lower-priced, mid-sized car to its product offering. Fiat returned to the United States in 2009 when it bought into Chrysler, and now is offering the lower-priced Ghibli, which still has the same 404-horsepower, twin-turbo V-6 engine that is in the larger, more expensive 2014 Quattroporte. The Ghibli can go from stop to 60 miles per hour in 4.7 seconds, according to company officials. The new Ghibli is expected to compete with the mid-size Porsche Panamera and Audi A7 luxury sports sedans. The Ghibli is expected to sell for $58,000, compared to the Panamera’s price tag of $79,000 and the Audi A-7 price of $65,000.