Wall Street hovers near record highs ahead of new jobs numbers

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By TERESA CEROJANO and MATT OTT, Associated Press

Wall Street was largely unchanged early Thursday, hovering near record levels ahead of new U.S. jobs data that is expected to show unemployment ticked up to the highest rates since late 2021.

Futures for S&P 500, Nasdaq and Dow Jones Industrial Average each inched up less than 0.1% before the bell. Markets are closed Friday for the July 4 holiday.

Treasury yields edged lower ahead of the highly anticipated June jobs report from the Labor Department. Economists believe that hiring slowed again last month as President Donald Trump’s trade wars, federal hiring freeze and immigration crackdown squeezes the American job market.

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Economists project that U.S. employers added 117,500 jobs last month and that the unemployment rate ticked up to 4.3%, which would be the highest since October 2021. However, it’s still low enough to suggest that most American workers continue to enjoy job security.

Also coming Thursday is a separate report from Labor that will show how many people applied for jobless benefits last week. The report is considered a proxy for layoffs.

Though the job market is broadly healthy by historical standards, it appears increasingly under strain as employers contend with fallout from Trump’s policies, especially his aggressive tariffs.

Tariffs raise prices for businesses and consumers alike and the vast majority of economists believe they make the economy less efficient by reducing competition. They also invite retaliatory tariffs from other countries, hurting U.S. exporters and potentially driving businesses to freeze hiring or cut staff.

Many of Trump’s stiff proposed taxes on imports are currently on pause, but they’re scheduled to kick into effect next week. Unless Trump reaches deals with other countries to lower the tariffs, economists fear they could hurt the economy and worsen inflation.

Elsewhere, in Europe at midday, Germany’s DAX and Paris’ CAC 40 each ticked up 0.1%, while Britain’s FTSE 100 gained 0.4%.

Tokyo’s Nikkei 225, which fluctuated between gains and losses during the day, added 0.1% to 39,785.90. In South Korea, the Kospi rose 1.3% to 3,116.27, while Australia’s S&P/ASX 200 slipped 0.1% to 8,589.80.

Hong Kong’s Hang Seng index lost 0.6% to 24,069.94. The Shanghai Composite index added 0.2% to 3,460.15.

Taiwan’s TAIEX gained 1.3% while India’s Sensex rose 0.2%. Vietnam’s VN Index shed earlier gains, slipping 0.2%.

Benchmark U.S. crude lost 14 cents to $67.31. Brent crude, the international standard, shed 21 cents to $68.90.

The dollar traded at 143.85 Japanese yen, up from 143.65 yen. The euro was at $1.1793, up from $1.1790.

On Wednesday, the S&P 500 set a record for the third time in four days and the Nasdaq composite gained 0.9%. The Dow Jones Industrial Average ticked down less than 0.1%.

Closely watched US jobs report likely to show hiring slowed in June

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By PAUL WISEMAN, Associated Press Economics Writer

The steady slowdown in U.S. hiring likely continued in June as President Donald Trump’s trade wars, federal hiring freeze and immigration crackdown weighed on the American job market.

When the Labor Department on Thursday releases job numbers for last month, they’re expected to show that businesses, government agencies and nonprofits added 117,500 jobs in June, down from 139,000 in May, according to a survey of forecasters by the data firm FactSet.

The unemployment rate is expected to have ticked up to 4.3%, which would be the highest since October 2021 but still low enough to suggest that most American workers continue to enjoy job security.

FILE – Katy Frank, a former computer scientist at the NOAA Great Lakes Environmental Research Lab, who lost her job Thursday, protests outside the John D. Dingell Veterans Affairs Medical Center in Detroit, Friday, Feb. 28, 2025. (AP Photo/Paul Sancya, File)

The U.S. job market has cooled considerably from red-hot days of 2021-2023 when the economy bounced back with unexpected strength from COVID-19 lockdowns and companies were desperate for workers. So far this year employers have added an average 124,000 jobs a month, down from 168,000 in 2024 and an average 400,000 from 2021 through 2023.

Hiring decelerated after the Federal Reserve raised its benchmark interest rate 11 times in 2022 and 2023. But the economy did not collapse, defying widespread predictions that the higher borrowing costs would cause a recession. Companies kept hiring, just at a more modest pace.

But the job market increasingly looks under strain. A survey released Wednesday by the payroll processor ADP found that private companies cut 33,000 jobs last month. “Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,” said ADP chief economist Nela Richardson. (The ADP numbers frequently differ from the Labor Department’s official job count.)

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Employers are now contending with fallout from Trump’s policies, especially his aggressive use of import taxes – tariffs.

Mainstream economists say that tariffs raise prices for businesses and consumers alike and make the economy less efficient by reducing competition. They also invite retaliatory tariffs from other countries, hurting U.S. exporters.

The erratic way that Trump has rolled out his tariffs — announcing and then suspending them, then coming up with new ones — has left businesses bewildered.

Manufacturers responding to a survey released this week by the Institute for Supply Management complained that they and their customers were reluctant to make decisions until they understood where Trump’s tariffs would end up. “That whiplash has to stop and it has to stay stopped,” said Susan Spence, chair of the ISM’s manufacturing survey committee.

Trump’s assault on the federal bureaucracy could also show up in June’s job report. Nancy Vanden Houten, lead U.S. economist at Oxford Economics, expects federal jobs dropped by 20,000 last month, “reflecting a hiring freeze, voluntary quits and retirements.’’ For now, she wrote in a commentary Wednesday, court rulings “have put massive federal layoffs on hold.’’

The president’s deportations — and the threat of them — also are likely to start having an impact on the job market by driving immigrants out of the job market. In May, the U.S. labor force — those working and looking for work — fell by 625,000, the biggest drop in a year and a half.

94 Palestinians killed in Gaza, including 45 people waiting for aid, authorities say

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TEL AVIV, Israel (AP) — Airstrikes and shootings killed 94 Palestinians in Gaza overnight, including 45 who were attempting to get much-needed humanitarian aid, hospitals and the Health Ministry said Thursday.

Israel’s military did not immediately comment on the strikes.

Israeli soldiers drive near the border with the Gaza Strip, in southern Israel, Wednesday, July 2, 2025. (AP Photo/Ohad Zwigenberg)

Five people were killed while outside sites associated with the Gaza Humanitarian Foundation, the newly-created, secretive American organization backed by Israel to feed the Gaza Strip’s population, while 40 others were killed waiting for aid in other locations across the Gaza Strip.

Dozens of people were killed in airstrikes that pounded the Strip Wednesday night and Thursday morning, including 15 people killed in strikes that hit tents in the sprawling Muwasi zone, where many displaced Palestinians are sheltering. A separate strike on a school in Gaza City sheltering displaced people also killed 15 people.

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Gaza’s Health Ministry said the number of Palestinians killed in Gaza has passed 57,000, including 223 missing people who have been declared dead, since the war began on Oct. 7, 2023. The ministry doesn’t differentiate between civilians and combatants in its death count but says that more than half of the dead are women and children.

The deaths come as Israel and Hamas inch closer to a possible ceasefire that would end the 21-month war.

Trump said Tuesday that Israel had agreed on terms for a 60-day ceasefire in Gaza and urged Hamas to accept the deal before conditions worsen. But Hamas’ response, which emphasized its demand that the war end, raised questions about whether the latest offer could materialize into an actual pause in fighting.

The Israeli military blames Hamas for the civilian casualties because it operates from populated areas. The military said it targeted Hamas militants and rocket launchers in northern Gaza that launched rockets toward Israel on Wednesday.

The war began when Hamas-led terrorists attacked southern Israel, killing 1,200 people and taking roughly 250 hostages.

The war has left the coastal Palestinian territory in ruins, with much of the urban landscape flattened in the fighting. More than 90% of Gaza’s 2.3 million population has been displaced, often multiple times. And the war has sparked a humanitarian crisis in Gaza, leaving hundreds of thousands of people hungry.

House Republicans are pushing Trump’s big bill to the brink of passage

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By LISA MASCARO, MARY CLARE JALONICK and LEAH ASKARINAM, Associated Press

WASHINGTON (AP) — House Republicans are ready to vote on President Donald Trump’s $4.5 trillion tax breaks and spending cuts bill early Thursday, up all night as GOP leaders and the president himself worked to persuade skeptical holdouts to drop their opposition by his Fourth of July deadline.

Final debates began in the predawn hours after another chaotic day, and night, at the Capitol. House Speaker Mike Johnson insisted the House would meet the holiday deadline after the Senate approved Trump’s signature domestic policy package on the narrowest vote.

“Our way is to plow through and get it done,” Johnson said, emerging in the middle of the night from a series of closed-door meetings. “We will meet our July 4th deadline.”

The outcome would be a milestone for the president and his party, a longshot effort to compile a long list of GOP priorities into what they call his “one big beautiful bill,” an 800-plus page package. With Democrats unified in opposition, the bill will become a defining measure of Trump’s return to the White House, with the sweep of Republican control of Congress.

Tax breaks and safety net cuts

At it core, the package’s priority is $4.5 trillion in tax breaks enacted in Trump’s first term, in 2017, that would expire if Congress failed to act, along with new ones. This includes allowing workers to deduct tips and overtime pay, and a $6,000 deduction for most older adults earning less than $75,000 a year.

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There’s also a hefty investment, some $350 billion, in national security and Trump’s deportation agenda and to help develop the “Golden Dome” defensive system over the U.S.

To help offset the costs of lost tax revenue, the package includes $1.2 trillion in cutbacks to the Medicaid health care and food stamps, largely by imposing new work requirements, including for some parents and older people, and a massive rollback of green energy investments.

The nonpartisan Congressional Budget Office estimates the package will add $3.3 trillion to the deficit over the decade and 11.8 million more people will go without health coverage.

“This was a generational opportunity to deliver the most comprehensive and consequential set of conservative reforms in modern history, and that’s exactly what we’re doing,” said Rep. Jodey Arrington, R-Texas, the House Budget Committee chairman.

Democrats united against ‘ugly bill’

Democrats unified against the bill as a tax giveaway to the rich paid for on the backs of the most vulnerable in society, what they called “trickle down cruelty.”

“Have you no shame?” said Rep. Rosa DeLauro, D-Conn. “Have the moral courage to oppose this bill.”

Rep. Madeleine Dean, D-Pa., center, speaks during a news conference at the U.S. Capitol, Wednesday, July 2, 2025, in Washington. (AP Photo/Mariam Zuhaib)

House Democratic Leader Hakeem Jeffries invoked the powerful history of the nation’s Independence Day holiday, and asked: “What does any of that have to do with this one, big ugly bill?”

He read for nearly two hours from a binder of letters, written by people across the country explaining how the health care programs have helped their families — and how devastating cuts would hurt.

Hauling the package this far in Congress has been difficult rom the start. Republicans have struggled mightily with the bill nearly every step of the way in the House and Senate, often succeeding only by the narrowest of margins: just one vote. In the Senate, Vice President JD Vance broke the tie vote. The slim 220-212 majority in the House leaves Republicans little room for defections.

Political costs of saying no

But few GOP lawmakers have been fully satisfied with the final product. Several more moderate Republicans had reservations about the cuts to Medicaid health care and the loss of green energy credits that could derail solar, wind and other renewable projects in their districts.

At the same time, conservatives, including those from the House Freedom Caucus, held out for steeper reductions. Republicans had warned the Senate against making changes to the House-passed bill, but senators put their own stamp on the final draft.

The House ground to a standstill Wednesday as a handful of holdouts refused to move so quickly. A morning roll call dragged for about seven hours, while an evening vote stalled for more than five, and Trump himself worked the phones and lashed out on social media.

“What are the Republicans waiting for??? What are you trying to prove???” Trump railed in a post-midnight vote.

Johnson, who has pulled close to Trump, relied on White House officials — including Cabinet secretaries, lawyers and others — to work skeptical Republicans through the details. Lawmakers were being told the administration could provide executive actions, projects or other provisions they needed in their districts back home.

“The president’s message was, ‘We’re on a roll,’” said Rep. Ralph Norman, R-S.C. “He wants to see this.”

Rep. Ralph Norman, R-S.C., a member of the conservative House Freedom Caucus, speaks to reporters following his White House meeting as Republicans work to push President Donald Trump’s signature bill of tax breaks and spending cuts across the finish line even as conservative and moderate GOP holdouts slow that effort, at the Capitol in Washington, Wednesday, July 2, 2025. (AP Photo/J. Scott Applewhite)

And the alternative, of bucking the president on his signature second-term package, carried grave political risks.

Trump has publicly threatened to campaign against the defectors. One House Republican who has staked out opposition to the bill, Rep. Thomas Massie of Kentucky, is being targeted by Trump’s well-funded political operation.

And Senate Republican Thom Tillis of North Carolina, who had been on the receiving end of Trump’s lashings, announced he would not seek reelection shortly before voting against the bill.

Rollback of past presidential agendas

In many ways, the package is a repudiation of the agendas of the last two Democratic presidents, a chiseling away at the Medicaid expansion from Barack Obama’s Affordable Care Act, and a pullback of Joe Biden’s climate change strategies in the Inflation Reduction Act.

Democrats have described the bill in dire terms, warning that cuts to Medicaid, which some 80 million Americans rely on, would result in lives lost. Food stamps that help feed more than 40 million people would “rip food from the mouths of hungry children, hungry veterans and hungry seniors,” Jeffries said.

Republicans say the tax breaks will prevent a tax hike on households and grow the economy. They maintain they are trying to rightsize the safety net programs for the population they were initially designed to serve, mainly pregnant women, the disabled and children, and root out what they describe as waste, fraud and abuse.

The Tax Policy Center, which provides nonpartisan analysis of tax and budget policy, projected the bill would result next year in a $150 tax break for the lowest quintile of Americans, a $1,750 tax cut for the middle quintile and a $10,950 tax cut for the top quintile. That’s compared with what they would face if the 2017 tax cuts expired.

Associated Press writers Kevin Freking, Joey Cappelletti and Matt Brown contributed.