Trade optimism sends stocks sharply higher
NEW YORK — Potentially encouraging news on trade and interest rates put Wall Street in a buying mood Tuesday, driving the market to solid gains and sending the Dow Jones Industrial Average 350 points higher.
Technology stocks powered much of the rally as investors welcomed news that the leaders of the U.S. and China will meet face-to-face next week to discuss their long-running trade dispute. Traders have been hoping for any positive sign in the trade war between the world's largest economies.
It's not the first time the market has rallied on seemingly encouraging developments on trade. Previous positive signs did not pan out, triggering market turbulence.
"You sort of have to ignore it a little bit," said Tobias Carlisle, founder and portfolio manager at Acquirers Funds. "It's probably going to drag out to the end of the year, so what we're trying to do is buy something undervalued, and it's great when there's a day like today and it works."
Markets also got a boost after the head of the European Central Bank said it was ready to cut interest rates and provide additional economic stimulus if necessary. The remarks put the spotlight on the Federal Reserve, which is set to announce its own decision on interest rates Wednesday.
Amazon adds 15 jets to growing fleet
NEW YORK — Amazon's fleet of jets is getting bigger.
The online shopping giant says it will lease 15 more Boeing 737s as it seeks to grow its delivery business and get packages to shoppers' doorsteps faster.
Amazon says it currently has 42 planes in its fleet and will have 70 by 2021.
The company wants more control over how its packages are delivered, relying less on UPS, the Postal Service and other carriers. Besides its fleet of planes, Amazon is building several hubs at airports that sort packages and has launched a program that lets contractors start businesses delivering packages in vans stamped with the Amazon logo.
Earlier this month, FedEx said it would drop an air shipment contract with Amazon in the United States, reducing its ties with the company.
Facebook plans a cryptocurrency
SAN FRANCISCO — Facebook has unveiled an ambitious plan to create a new digital currency for global use similar to Bitcoin. If successful, it could drive more e-commerce on its services and boost ads on its platforms.
The social media giant calls it Libra, a cryptocurrency it is launching with more than two dozen partners, including Uber, PayPal, Visa and Spotify. It is likely to spark privacy concerns with people who are wary about giving Facebook more information about themselves
Home construction slips in May
WASHINGTON — U.S. home construction slipped a bit in May as a sharp drop in single-family construction was only partially offset by a rise in apartment building.
The Commerce Department said Tuesday that construction was started at a seasonally adjusted annual rate of 1.27 million homes and apartments, a decline of 0.9% from April when construction starts had risen a strong 6.8 %. Applications for building permits, a good sign of future activity, edged up 0.3% in May to an annual rate of 1.29 million.
Construction of single-family homes fell 6.4% in April while construction of apartments rose 10.9%.
Falling mortgage rates are expected to help boost home construction and sales in coming months and help offset such problems as a shortage of building lots and a lack of skilled construction workers.
The latest National Association of Home Builders/Wells Fargo survey showed builder confidence dipped to a still solid reading of 64 in June, down from 66 in May. Sentiment levels have held in a range of the low- to mid-60s for the past five months.
"Despite lower mortgage rates, home prices remain somewhat high relative to incomes, which is particularly challenging for entry-level buyers," said Robert Dietz, chief economist for the home builders.
Google pledges $1B for housing
SAN FRANCISCO — Google is making a $1 billion commitment to address the soaring price of housing in the San Francisco Bay Area, a problem that the internet company and its Silicon Valley peers helped create as the technology industry hired tens of thousands of high-paid workers.
The pledge announced Tuesday by CEO Sundar Pichai consists of a $250 million investment fund and $750 million of company-owned land that will be used to build at least 15,000 homes that will include low- and mid-income housing.
Google is lending a helping hand as it draws up plans to expand into sprawling offices beyond its headquarters in Mountain View, Calif. The suburban city of roughly 80,000 people has been swamped with affluent tech workers since Google moved there shortly after its 1998 inception.
NC city denies RV dealer's big flag
STATESVILLE, N.C. — A North Carolina city has voted against the flying of really big flags, holding its ground against a reality TV star's huge Stars and Stripes.
News outlets report the Statesville City Council voted down changes to the flag ordinance Monday night. That means flags in Statesville must be no larger than 25 feet by 40 feet. That's roughly half the size of the American flag that Marcus Lemonis has unfurled outside his Gander RV company.
Statesville has asked a court to order Gander RV to comply or pay a $50 per day fine.
Lemonis runs Camping World and stars on "The Profit" on CNBC. He says the flag is staying. He's said he'll go to jail for contempt of court to protect his constitutional rights.
Icelandair halts Fla. flights, cites Max
TAMPA, Fla, — Icelandair has pulled out of Tampa International Airport because the grounding of the Boeing 737 Max jets has left it short of planes.
The airline told the Tampa Bay Times on Monday that it was immediately halting flights from Florida.
It said the grounded planes made up 14 percent of its fleet, and adjustments had to be made. The redesigned planes were grounded by all carriers worldwide earlier this year after crashes in Indonesia and Ethiopia killed 346 people.
Icelandair had been offering multiple flights per week to Reykjavik from Tampa. It earlier cut flights from Cleveland and Nova Scotia.
Siemens plan to cut 2,700 jobs
BERLIN — German industrial equipment maker Siemens says it is cutting 2,700 jobs globally at its power and gas company as it seeks to make cost savings.
Siemens said Tuesday that the cuts include 1,400 jobs in Germany and would take place over the course of several years.
The layoffs come in addition to the 10,400 from its core units that the company already announced last month.
Siemens in May said it was undertaking a major restructuring that would involve spinning off its oil, gas and power generation business and creating new areas of growth.
The company plans to save $2.5 billion in costs by 2023.