Microsoft and Meta Platforms lead Wall Street higher

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By STAN CHOE, Associated Press Business Writer

NEW YORK (AP) — Microsoft and Meta Platforms are driving Wall Street higher on Thursday after profits for the Big Tech companies at the start of the year turned out to be even bigger than analysts expected.

The S&P 500 was up 0.8% and heading for an eighth straight gain, which would be its longest winning streak since August. The Dow Jones Industrial Average was up 124 points, or 0.3%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 1.9% higher.

Microsoft jumped 10.2% after the software giant said strength in its cloud computing and artificial intelligence business drove its overall revenue up 13% from a year earlier.

Meta, the parent company of Facebook and Instagram, also topped analysts’ targets for revenue and profit in the latest quarter. It said artificial intelligence tools helped boost its advertising revenue, and its stock climbed 6.4%.

CVS Health and a bevy of other companies also joined the growing stream of better-than-expected profit reports that have been helping to steady Wall Street over the last week. The S&P 500 is back to within 9% of its record set earlier this year, after briefly dropping nearly 20% below the mark.

Still, plenty of uncertainty remains about whether President Donald Trump’s trade war will force the economy into a recession. Several reports have recently shown the U.S. economy is weaker than expected, and the latest arrived Thursday showing that more U.S. workers filed for unemployment benefits last week than economists had forecast. It’s setting the stage for a more comprehensive report on the job market arriving Friday.

And even though companies have been reporting better profits for the first three months of the year than analysts expected, many CEOs are remaining cautious about the rest of the year.

General Motors cut its forecast for profit in 2025, for example. It said it’s assuming it will feel a hit of $4 billion to $5 billion because of tariffs, and it expects to offset at least 30% of it. GM’s stock slipped 0.3%.

McDonald’s fell 1.3% after reporting weaker revenue for the latest quarter than analysts expected, even though its profit was slightly above forecasts. An important underlying measure of performance at its U.S. restaurants had its worst decline since 2020, when COVID shuttered the global economy.

McDonald’s joined Chipotle and other restaurant chains that have seen customers get more cautious amid all the uncertainty about the economy and inflation that’s still higher than many people would like.

Such conditions are raising the threat of a worst-case scenario called “stagflation,” where the economy stagnates yet inflation remains high. It’s so hated because the Federal Reserve has no good tools to fix both problems at the same time. If the Fed were to try to help one problem by adjusting interest rates, it would likely make the other worse.

Some encouraging news on inflation arrived Wednesday, when a report said that the measure of inflation the Fed likes to use slowed in March.

That’s raising expectations among traders that the Fed may resume cutting interest rates later this year in order to prop up the economy. Those expectations in turn are helping to drive down Treasury yields in the bond market.

The yield on the 10-year Treasury fell to 4.14% from 4.17% late Wednesday.

In stock markets abroad, trading was closed in many countries for May Day, or international Labor Day holidays.

Tokyo’s Nikkei 225 rose 1.1% after the Bank of Japan kept its benchmark interest rate unchanged, as many investors expected.

AP Business Writers Yuri Kageyama and Matt Ott contributed.

Trump’s agenda faces courtroom setbacks as Justice Department lawyers struggle to win over judges

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By ERIC TUCKER and ALANNA DURKIN RICHER, Associated Press

WASHINGTON (AP) — To understand the Justice Department’s struggles in representing President Donald Trump’s positions in court, look no further than a quick succession of losses last week that dealt a setback to the administration’s agenda.

In orders spanning different courthouses, judges blocked a White House plan to add a proof-of-citizenship requirement to the federal voter registration form, ruled the Republican administration violated a settlement agreement by deporting a man to El Salvador and halted directives that threatened to cut federal funding for public schools with diversity, equity and inclusion programs.

That’s on top of arguments in which two judges expressed misgivings to a Justice Department lawyer about the legality of Trump executive orders targeting major law firms and a department lawyer’s accidental filing of an internal memo in court questioning the Trump administration’s legal strategy to kill Manhattan’s congestion toll — a blunder the Transportation Department called “legal malpractice.”

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The Trump administration’s effort to reshape American civil society, including a crackdown on illegal immigration and downsizing of the federal government, is encountering resistance from judges across a broad spectrum of philosophical leanings as lawyers for the Justice Department in some cases have strained to answer straightforward questions from judges about the basis or rationale for a particular policy or about the mechanics of its implementation. In at least one instance, a government lawyer who became openly exasperated in court at the lack of information he’d been given from the administration was soon after fired by the Justice Department.

Compounding the problem is an ongoing exodus from the department of experienced career lawyers accustomed to representing the federal government in court. Some of the key arguments in recent weeks have been handled by lawyers newly hired into political, rather than career, positions.

Justice Department leadership has in recent months hired lawyers with conservative credentials from law firms in Washington and with past experience at state and local government agencies.

“This is quite rare, if not unprecedented,” said Boston College law professor Kent Greenfield. “I can’t think of another instance in which the Justice Department has lost so many cases in a short period of time and the reason they’re losing is because they’re wrong — and obviously wrong.”

According to an Associated Press tally, about 50 Trump executive actions have been partially or fully blocked by the courts while about 40 have been left in effect. Dozens of others are pending.

Trump administration officials, including Attorney General Pam Bondi, have attributed the losses to what they call “activist” judges bent on impeding his agenda. Some White House allies have called for impeaching judges, with adviser Elon Musk describing it as a “judicial coup.”

But that belies the reality that some of the most blistering rebukes of Justice Department arguments have come from conservative judges like J. Harvie Wilkinson III, an appointee of Republican President Ronald Reagan who said in an April opinion that the idea the government could not return to the U.S. a man it had deported to El Salvador was “shocking not only to judges, but to the intuitive sense of liberty that Americans far removed from courthouses still hold dear.”

Jonathan Turley, a George Washington University law professor, cautioned against making too much so soon in the administration of its legal track record. The Supreme Court with its conservative 6-3 majority, including three Trump appointees, has yet to weigh in on the vast majority of the cases.

“This Department of Justice will continue to defend President Trump’s agenda in court, and we remain confident that we will ultimately prevail,” Justice Department spokesperson Chad Gilmartin said in an email.

The Trump administration has also succeeded in some cases in beating back legal challenges, and some early defeats at the trial court level have been subsequently overturned by a federal appeals court, such as when a panel cleared the way for the administration to fire thousands of probationary workers in spite of a judge’s earlier opinion.

In another case, the Supreme Court overturned a lower judge’s order that had blocked the administration from using an 18th-century wartime law to deport Venezuelan migrants, though the court said they must get a chance to challenge their removals before they’re taken from the United States. The Supreme Court also recently granted the Trump administration’s plea to cut hundreds of millions of dollars in teacher training money while a lawsuit continues.

“There’s over 600 District Court judges, any one of which can issue limited or national injunctions,” Turley said. The rulings may be important, he added, “but there’s a great deal of runway between a U.S. district court and the United States Supreme Court.

The challenges, however, were laid bare in a Washington courtroom just last week when Richard Lawson, a newly minted deputy associate attorney general, repeatedly struggled to provide what the judge said was “basic” information about one in a series of executive orders targeting a major law firm with punishing sanctions.

“So you don’t know whether the firm or the individuals whose security clearances were suspended have been given any notice about the timing of the review, who the decision-maker is, the information that’s being reviewed as part of this review, whether they’re going to have an ability to see that information, comment on the information, correct the information, object to the information?” Howell asked pointedly. “You can’t tell me anything about that?”

“I can’t speak to that, Your Honor,” replied Lawson, who before recently joining the Justice Department had worked with Bondi in the Florida attorney general’s office and was also a lawyer at a pro-Trump think tank called the America First Policy Institute.

Lawson fared no better weeks earlier when pushed to explain the administration’s national security rationale for punishing a different law firm, Jenner & Block, because one of its former partners, Andrew Weissmann, had years earlier been a prosecutor on the team of special counsel Robert Mueller that investigated Trump.

“You’re not going to really tell me that having someone employed four years ago poses some kind of national security threat?” asked U.S. District John Bates, an appointee of George W. Bush, a Republican.

“Not per se, no,” replied Lawson.

In another case, Judge Colleen Kollar-Kotelly scolded the Justice Department in court papers last week over what she described as the “contradiction” between statements made in court by one of its lawyers “and the facts on the ground.” While the judge did not contend that the lawyer “intentionally misrepresented the facts,” the appointee of Democratic President Bill Clinton added: “The Court must remark that this exchange does not reflect the level of diligence the Court expects from any litigant — let alone the United States Department of Justice.”

Stuart Gerson, who led the Justice Department’s civil division under Republican President George H.W. Bush and later served briefly as acting attorney general, said it appeared the Trump administration was sending lawyers into court” without adequate information and instructions.”

“I sympathize greatly with these folks who are arguing some of the cases, who are just parroting what they’ve been told to say without being able to answer questions about their ramifications, the what-ifs and the background information,” Gerson said.

Stillwater Lift Bridge opens for the season

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Warm spring weather and numerous requests from boaters have prompted Minnesota Department of Transportation officials to start the 2025 schedule of the Stillwater Lift Bridge this week.

The Lift Bridge is now staffed from 8 a.m. to midnight each day, and the bridge will lift every half hour if boat traffic is present.

The lift schedule is expected to stay in effect through late October.

Bridge tenders will respond to special requests to lift the bridge after midnight if given a two-hour notice; requests can be made by calling MnDOT’s 24-hour dispatch at 651-234-7110.

For more information, go to: dot.state.mn.us/stillwaterliftbridge.

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The number of Americans filing for jobless claims jumps last week, but remains at healthy levels

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By MATT OTT, Associated Press Business Writer

U.S. applications for jobless benefits jumped to their highest level in two months, but layoffs remain in a historically healthy range.

Jobless claim applications jumped by 18,000 to 241,000 for the week ending April 26, the Labor Department said Thursday. That’s more than the 225,000 new applications analysts forecast and the most since late February.

Weekly applications for jobless benefits are considered a proxy for layoffs, and have mostly stayed in a healthy range between 200,000 and 250,000 for the past few years.

The four-week average of applications, which softens some of the week-to-week volatility, rose by 5,500 to 226,000.

The total number of Americans receiving unemployment benefits for the week of April 19 climbed to 1.92 million, the most since November of 2021.