US home prices rise 4% in April
WASHINGTON — U.S. home prices rose in April for the eighth straight month, even as sales have stumbled, a sign the coronavirus outbreak has had little impact on real estate values.
The S&P CoreLogic Case-Shiller 20-city home price index climbed 4 percent in April, the largest gain since December 2018, up from 3.9 percent in March.
Home sales have fallen sharply for three straight months to their lowest annual pace in nearly a decade in May. Yet the supply of available houses for sale has also declined, forcing remaining buyers to bid up prices.
"The price trend that was in place pre-pandemic seems so far to be undisturbed, at least at the national level," said Craig Lazzara, managing director of S&P Dow Jones Industries. "Prices in 12 of the 20 cities in our survey were at an all-time high in April."
Sales of existing homes are likely to pick up in coming months, however. A measure of signed contracts to buy homes soared 44 percent in May, a record increase. And sales of new homes also rebounded in May.
Airbus to shed 15K jobs, mostly abroad
PARIS — Battered by the coronavirus pandemic, European aircraft manufacturer Airbus said Tuesday that it must eliminate 15,000 jobs, mostly in Europe, to safeguard its future and warned of more thin years ahead.
"With air traffic not expected to recover to pre-COVID levels before 2023 and potentially as late as 2025, Airbus now needs to take additional measures," the company said in a statement.
No later than the summer of 2021, Airbus wants to shed 5,000 workers in France, 5,100 in Germany, 1,700 in Britain, 900 in Spain and 1,300 others at facilities elsewhere, including a U.S. commercial aircraft plant in Alabama. The total of 15,000 is more than 10 percent of its global workforce of 135,000.
Airbus said it wants to start making the cuts within months, from this autumn. It will aim for voluntary departures and early retirements, but also said that compulsory job losses can't be ruled out. It said is already consulting with unions.
"The path to recovery will prove slow and fragile and a large amount of uncertainty still lies ahead," CEO Guillaume Faury said. "We must act now to safeguard Airbus and protect its future."
Airbus said its commercial aircraft business activity has plummeted by close to 40 percent as the pandemic has shut borders, brought mass tourism to a screeching halt and put airlines on their knees, thumping the European manufacturer and its rival Boeing, which also is cutting jobs.
Hardest-hit firms may be next aid focus
WASHINGTON — Treasury Secretary Steven Mnuchin has told Congress that the administration wants the next round of economic aid to focus on supporting businesses like restaurants that have been hardest hit by the coronavirus crisis.
Mnuchin said Tuesday he is already talking to lawmakers about getting another round of relief approved by the end of July. He said those discussions included ways to use left-over funds from the $2.2 trillion coronavirus relief bill.
There is about $128 billion in that program that has not been doled out from the popular Paycheck Protection Program that was designed to provide support to businesses if they keep their workers on the payroll.
Consumers felt more confident in June
WASHINGTON — U.S. consumer confidence rose in June, reflecting the partial reopening of the country but the concern is that rising coronavirus cases in many states could jeopardize future gains.
The Conference Board, a New York-based research organization, said that its Consumer Confidence Index rose to 98.1 in June after virtually no change at 85.9 in May.
Even with the June rebound, the confidence index remains well below its pre-pandemic levels. The reading on consumer confidence is closely watched for clues it can give about future consumer spending, which accounts for 70 percent of economic activity.
China factories busier in June
BEIJING — China's manufacturing activity improved in June after anti-virus controls were eased to revive the economy but export demand was weak, a survey released Tuesday showed.
A monthly purchasing managers' index released by the government statistics agency and an industry group rose to 50.9 from May's 50.6 on a 100-point scale on which numbers above 50 show activity expanding.
China, where the coronavirus pandemic began in December, was the first economy to reopen in March after the ruling Communist Party declared victory over the disease. Manufacturing and other activity is reviving but demand for exports is feeble and Chinese consumers, worried about losing jobs, are reluctant to spend.
The survey adds to signs China's economy is gradually recovering, supported by higher government construction spending. But forecasters say global demand for Chinese goods is uncertain as infections rise in other countries.
"The external environment is very severe," the China Federation of Logistics & Purchasing said in a statement. It said production is "still significantly higher" than demand.
Shell takes $22B hit on lower prices
LONDON — Energy producer Royal Dutch Shell warned Tuesday it will slash the value of its assets by $22 billion to account for lower oil and gas prices amid the COVID-19 pandemic.
With the virus outbreak hurting the long-term prospects of the global economy, the company said it continues "to adapt to ensure the business remains resilient" in challenging times. Earlier this month, its competitor BP, also cut the value of its own assets by up to $17.5 billion.
The pandemic has hit the wider energy industry hard because it has placed onerous limits on business, travel and public life. There is little need in aviation for fuel, for example, since most planes are grounded.
Supply of oil and gas was particularly high when the outbreak began, creating a perfect storm for the industry. With storage facilities filling up, the U.S. price of oil went below zero in April for the first time ever.
Shell predicted prices for Brent crude, the international oil benchmark, would be %50 dollars a barrel in 2022, having earlier predicted a price of $60 a barrel. On Tuesday, it was trading near $41 a barrel.
Miss. shipyard wins $936M Navy deal
PASCAGOULA, Miss. — A Mississippi shipyard has a $936 million Navy contract modification to build another destroyer equipped to launch guided missiles. This comes in addition to a $5.1 billion contract signed in 2018 for Ingalls Shipbuilding in Pascagoula to build six Arleigh Burke-class destroyers.
The contract and Monday's modification are for Flight III of the design, which the Navy says incorporates an air and missile defense radar system much better than those in previous models.
The Pentagon list of defense contracts signed Monday notes that the contract modification includes the possibility of nearly $11.7 million more in engineering change proposals, design budgeting requirements and post-delivery availabilities.
The shipyard is a division of Huntington-Ingalls Industries Inc. of Newport News, Va.
Ingalls has delivered 32 destroyers to the Navy — the most recent in April — and has four more under construction, according to the company.