Business Highlights: Household wealth surges; Tesla profit slumps on price cuts
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A surge in wealth has boosted most US households since 2020 and helped sustain economic growth
WASHINGTON (AP) — The net worth of the typical U.S. household grew at the fastest pace in more than three decades from 2020 through 2022, while relatively low interest rates at that time made it easier for households to pay their debts. Wealth for the median household — the midpoint between the richest and poorest households — jumped 37% during those three years, the Federal Reserve reported, to nearly $193,000. (The figures are adjusted for inflation.) The increase reflected primarily a jump in home values and higher stock prices and a rise in the proportion of Americans who own homes and stocks.
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Europe is looking to fight the flood of Chinese electric vehicles. But Europeans love them
LONDON (AP) — Chinese automakers are winning over drivers as they make major inroads into Europe’s electric vehicle market. They’re challenging long-established homegrown brands in an industry that’s key to Europe’s green energy transition. The competitive threat has spurred the European Union to launch an investigation into Beijing’s support for its EV industry. That adds to tech-related tensions between the West and China. Europe is attractive for Chinese EVs because auto import tariffs are a lot lower than in the U.S. One in every five EVs sold in Europe is a Chinese import, if you include vehicles that global automakers like Tesla and BMW build in China.
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Amazon will start testing drones that will drop prescriptions on your doorstep, literally
Amazon will soon make prescription drugs fall from the sky when the e-commerce giant becomes the latest company to test drone deliveries. The company said Wednesday that customers in College Station, Texas can now get prescriptions delivered by a drone within an hour of placing their order. The drone is programed to fly from a delivery center with a secure pharmacy. It will travel to the customer’s address, descend to a height of about four meters — or 13 feet — and drop a padded package. Other companies that have tested prescription drone deliveries include CVS Health.
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Tesla’s net income slumped 44% in the 3rd quarter as lower prices ate into the automaker’s profits
LOS ANGELES (AP) — Tesla has reported that its net income slumped in the third quarter versus a year earlier. That came as its price cuts helped drive strong sales growth but also ate into the automaker’s profit margins. The Austin, Texas, maker of electric vehicles, solar panels and batteries on Wednesday reported net income of $1.85 billion for the July-September quarter, a 44% decline from a year earlier. Tesla has been slashing prices most of this year to keep attracting buyers who now have a wider selection of electric vehicles as more automakers shift away from gasoline-powered cars and trucks. The discounts range from $4,400 on Tesla’s top-selling vehicles to as much as $20,000 on its most expensive models.
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China’s economy grows 4.9% in Q3, beating expectations but slowing from previous quarter
HONG KONG (AP) — China’s economy slowed in the summer as global demand for its exports faltered and the ailing property sector sank deeper into crisis. The government said Wednesday that the economy expanded at a 4.9% annual pace in July-September, beating analysts’ forecasts of about 4.5%. But that was much slower than the 6.3% annual growth rate of the previous quarter. The Chinese government has issued policy support measures to help the economy, including raising spending on ports and other infrastructure, cutting interest rates and easing curbs on home-buying. Trade data released last week showed exports and imports continued to decline in September though they contracted at a slower rate than in the month before.
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Stock market today: Wall Street drops following profit reports, and oil prices jump on war worries
NEW YORK (AP) — Wall Street dropped after big U.S. companies delivered a mixed set of profit reports and rising Treasury yields tightened the vise further on the stock market. Worries about war in the Middle East also dragged on the market Wednesday. The S&P 500 fell 1.3%. The Dow Jones Industrial Average lost 332 points, and the Nasdaq composite fell 1.6%. Crude oil prices jumped following a deadly explosion at a hospital in the Gaza Strip. Gold kept rising as investors looked for safer investments. The 10-year Treasury yield climbed to touch its highest level since 2007.
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Employer-sponsored health coverage costs jumped this year. More hikes may be coming
A national survey of employers found that the cost of health coverage through work jumped this year, in part because of inflation. Premiums for both family and single plans climbed 7% after barely rising in 2022. That’s according to KFF, a nonprofit that researches health care issues. And health care experts say more price hikes could be coming in 2024. Employees may learn about those later this fall, when companies begin their annual coverage enrollment window. Employer-sponsored health insurance is the most common form of coverage in the United States. KFF says almost 153 million Americans have it.
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Shares of United Airlines plunge on sour outlook for 4Q profit because of rising fuel prices
Shares of United Airlines are tumbling based on the carrier’s gloomy outlook for fourth-quarter profit. And they’re taking other airline stocks lower, too. United said after the market closed Tuesday that it earned $1.14 billion in the third quarter, which included much of the summer vacation-travel season. But investors are more focused on United’s fourth-quarter forecast, which was far short of Wall Street expectations.
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The S&P 500 fell 58.60 points, or less than 1.3%, to 4,314.60. The Dow Jones Industrial Average fell 332.57 points, or 1%, to 33,665.08. The Nasdaq composite fell 219.44 points, or 1.6%, to 13,314.30. The Russell 2000 index of smaller companies fell 37.24 points, or 2.1% to 1,728.81.