By GENE JOHNSON, Associated Press

SEATTLE (AP) — A federal judge on Wednesday temporarily blocked the Trump administration from imposing new conditions on hundreds of millions of dollars worth of mass transit grants for the Seattle area or homelessness services grants for Boston, New York, San Francisco and other local governments.

The new conditions were designed to further President Donald Trump’s efforts to eliminate diversity, equity and inclusion policies; coerce local officials into assisting with the administration’s mass deportation efforts; and cut off information about lawful abortions, according to the lawsuit filed last week by eight cities and counties.

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The administration argued that Senior U.S. District Judge Barbara Rothstein in Seattle did not have jurisdiction over the lawsuit because it was essentially a contract dispute that should have been brought in the Court of Federal Claims — an argument the judge rejected.

Rothstein wrote that the local governments had shown they were likely to win the case, because the conditions being imposed on the grants had not been approved by Congress, were not closely related to the purposes of the grants and would not make the administration of the grants more efficient.

“Defendants have put Plaintiffs in the position of having to choose between accepting conditions that they believe are unconstitutional, and risking the loss of hundreds of millions of dollars in federal grant funding, including funding that they have already budgeted and are committed to spending,” Rothstein wrote.

Her order blocks U.S. Housing and Urban Development and the Federal Transportation Administration for 14 days from enforcing the new grant conditions or withholding or delaying funding awarded under the grants. The local jurisdictions said they would seek a longer-term block in the meantime.

The Trump administration did not immediately respond to an email seeking comment.

King County, which includes Seattle, sued over changes to grant conditions for homelessness services as well as mass transit funding that helps pay for maintenance of the region’s light rail system. Boston and New York, Pierce and Snohomish Counties in Washington, the city and county of San Francisco, and Santa Clara County in California all sued over the changes to homelessness services grants.

“Today’s ruling is a positive first step in our challenge to federal overreach,” King County Executive Shannon Braddock said in a statement. “We will continue to stand up against unlawful actions to protect our residents and the services they rely on.”

The conditions highlighted in the plaintiff’s restraining order motion included barring grant recipients from using the funding in a way that promotes “illegal immigration or abets policies that seek to shield illegal aliens from deportation.” Another condition bars them from using the funding to “promote elective abortions.”

AP reporter Hallie Golden in Seattle contributed to this report.

By STAN CHOE, Associated Press Business Writer

NEW YORK (AP) — U.S. stocks are rising Thursday after President Donald Trump said he was set to announce an agreement on trade with the United Kingdom, the first of what Wall Street hopes will be enough to keep a recession from hitting the economy.

The S&P 500 was 0.6% higher in early trading and on track for an 11th gain in the last 13 days. The Dow Jones Industrial Average was up 253 points, or 0.6%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.9% higher.

Stocks have been swinging for weeks with hopes that Trump could reach deals with other countries that would lower his tariffs, which many investors believe would cause a recession if left unchecked. Trump said Thursday that the U.K. agreement, which is set to be announced at 10 a.m. Eastern, is “a full and comprehensive one.”

“Many other deals, which are in serious stages of negotiation, to follow!” he added on his Truth Social account.

It could be an encouraging start, and analysts said they’re curious to see if it will affect the 10% tariffs that Trump placed on all imports coming into the United States on “Liberation Day.” But bigger trading partners could offer bigger hurdles, including China.

The world’s second-largest economy again on Thursday called on the United States to cancel its tariffs, ahead of high-level talks between the world’s two largest economies that could take place this weekend. That followed Trump’s saying on Wednesday that he wouldn’t reduce his 145% tariffs on Chinese goods as a condition for negotiations.

Besides hopes for deals on trade, strong profit reports from U.S. companies have also helped to drive the S&P 500 closer to its all-time high set in February.

Tapestry joined the list Thursday, and its stock climbed 5% after the company behind the Coach and Kate Spade brands reported better profit and revenue than expected. It credited new, younger customers in North America, among other things.

Molson Coors, though, described a different landscape when it released its latest quarterly results, which fell short of analysts’ expectations. Its stock fell 7.4%.

“The global macroeconomic environment is volatile,” CEO Gavin Hattersley said. “Uncertainty around the effects of geopolitical events and global trade policy, including the impacts on economic growth, consumer confidence and expectations around inflation, and currencies has pressured the beer industry and consumption trends.”

It became the latest company to either lower or pull its financial forecasts for 2025 given the uncertainty.

Krispy Kreme tumbled 24.3% after withdrawing its forecasts for the full year. The doughnut seller said it made the move in part because of “macroeconomic softness” and because it’s pausing the rollout of sales of its doughnuts at more McDonald’s restaurants.

The U.S. economy has remained OK so far, with the Federal Reserve saying Wednesday that it still looks to be running at a solid rate underneath the surface. But pessimism has soured sharply among U.S. households because of tariffs, and the fear is that all the uncertainty created by them could be enough to force the economy into a recession.

A couple mixed reports on the economy Thursday did little to clear the caution. One said slightly fewer U.S. workers applied for unemployment benefits last week. But another one said productivity for U.S. workers weakened by more than economists expected during the first three months of the year. That could keep upward pressure on inflation, when tariffs could be set to raise prices for all kinds of imported products.

Treasury yields rose following the reports, and the 10-year yield climbed to 4.29% from 4.26% late Wednesday.

In stock markets abroad, the FTSE 100 slipped 0.1% in London after the Bank of England cut its main interest rate by a quarter of a percentage point.

Indexes were modestly higher across much of the rest of Europe and Asia.

AP Business Writers Yuri Kageyama and Matt Ott contributed.

By LORNE COOK, Associated Press

BRUSSELS (AP) — The European Union published on Thursday a list of U.S. imports that it would target with retaliatory duties if no solution is found to end U.S. President Donald Trump’s tariff war, which could include aircraft maker Boeing.

At the same time, the EU’s executive branch, the European Commission, said that it would begin legal action at the World Trade Organization over the “reciprocal tariffs” that Trump imposed on countries around the world a month ago.

“The EU remains fully committed to finding negotiated outcomes with the U.S.,” commission President Ursula von der Leyen said. “At the same time, we continue preparing for all possibilities.”

The commission manages trade deals and disputes on behalf of the 27 EU countries.

In early April, Trump imposed a 20% levy on goods from the EU as part of his tariff onslaught against global trading partners. A week later he paused them for 90 days to give countries a chance to negotiate solutions to U.S. trade concerns.

A blanket 10% tariff still applies to EU imports.

The commission drew up countermeasures to target 20.9 billion euros ($23.6 billion) of U.S. goods, roughly the equivalent of what Trump would be hitting in Europe. But it also paused them for 90 days to give negotiations a chance.

The bloc’s top trade official has shuttled between Brussels and Washington trying to find a solution, but with little to show, the commission has made public a list of American imports for possible targeting worth 95 billion euros ($107 billion).

The list is broken down into sectors and broad categories of products rather than brand names. It contains 10.5 billion euros ($11.9 billion) worth of aircraft, 10.3 billion euros ($11.6 billion) in vehicle parts and 2 billion euros ($2.3 billion) in vehicles.

Around 1.3 billion euros ($1.5 billion) in imports of U.S. wine, beer and spirits could also be hit. European wine producers have been deeply concerned that Trump’s tariffs would deal a severe blow to their sector, which relies on the U.S. as its top market.

Interested companies and parties are being given until June 10 to provide feedback, before the commission decides on the next steps. “Boeing is very welcome to make comments on this list,” a commission official said, briefing reporters on the list and the rationale for the EU’s approach.

In parallel, the commission said that it would be taking legal action at world trade’s governing body, and would soon request consultations with the United States to try to resolve the issue, which must take place within two months.

It said that this action would focus on Trump’s “universal” reciprocal tariffs, and duties on cars and car parts. “It is the unequivocal view of the EU that these tariffs blatantly violate fundamental WTO rules,” a statement said.

The commission estimates that 379 billion euros ($428 billion) of EU exports to the U.S. have been hit by new tariffs, including those on pause until mid-July, since Trump took office. It said they are already “raising costs for business, stifling growth, fueling inflation and heightening economic uncertainty.”

By MATT OTT, Associated Press Business Writer

WASHINGTON (AP) — The number of Americans applying for unemployment benefits fell last week despite heightened uncertainty about how President Donald Trump’s tariffs will impact the U.S. economy.

Jobless claim applications fell by 13,000 to 228,000 for the week ending May 3, the Labor Department said Thursday. That’s in line with the 229,000 new applications analysts forecast.

Weekly applications for jobless benefits are considered a proxy for layoffs, and have mostly bounced around a healthy range between 200,000 and 250,000 since COVID-19 decimated the economy and wiped out millions of jobs.

The four-week average of claims, which evens out some of the week-to-week gyrations, inched up by 1,000 to 227,000.

The total number of Americans receiving unemployment benefits for the week of April 26 fell to 1.88 million, a decrease of 29,000.