Stock Market News: ADP jobs, debt deal passes, Macy’s sinks, Elon Musk world’s richest

U.S. stock indexes closed up on Thursday as signs of slowing wage pressure on inflation raised hopes the Federal Reserve will pause raising interest rates in two weeks, and investors welcomed a vote in Congress to suspend the U.S. debt ceiling.

The number of Americans filing new claims for unemployment benefits rose modestly last week, while private payrolls increased more than expected in May, pointing to a still tight labor market that could push the Fed to keep rates elevated.

Focus now shifts to the Labor Department's closely watched unemployment report for May, due on Friday. The data will help determine whether the Fed sticks with its aggressive rate hikes.

Wage inflation is slowing, as reported by ADP, while a Labor Department report said the price of labor per single unit of output rebounded at a 4.2% rate in the first quarter - a downward revision from the 6.3% growth pace estimated in May.

Meta Platforms CEO Mark Zuckerberg on Thursday revealed the company's next generation mixed reality headset, the Quest 3, as the company braces for Apple to potentially reshape a nascent market that Meta has dominated so far.

Priced starting at $499, the device will be 40% thinner than the company's previous headset and feature color mixed reality, which combines augmented and virtual reality (AR/VR) elements, Zuckerberg said in an Instagram post ahead of Meta's annual gaming conference.

The Quest 3 will have a new Qualcomm chipset with twice the graphics performance as the Quest 2, Zuckerberg said. He said the device would launch in the autumn and promised more details at the company's annual AR/VR conference on Sept. 27.

Zuckerberg's announcement came less than a week before tech rival Apple was expected to unveil its first mixed reality device, a high-end product with a price point around $3,000, according to a Bloomberg report.

Alabama families could soon pay less at the grocery store after lawmakers advanced a plan Thursday to remove half of the 4% state sales tax on food.

Senators on Thursday voted 31-0 for the legislation. It would gradually remove half of the state’s 4% sales tax on food by Sept. 1, 2024, provided there is enough revenue growth to offset the loss. The bill now goes back to the Alabama House of Representatives, where lawmakers will decide whether to accept a Senate change to the bill. It could win final approval as soon as Thursday afternoon.

Alabama is one of only three states that tax groceries at the same rate as other purchases.

“This is going be great for working Alabamians. Folks who are struggling to put food on the table," Republican Sen. Andrew Jones, sponsor of the Senate version of the bill, said after passage.

The U.S. Transportation Department (USDOT) said on Thursday it is fining British Airways $1.1 million for failing to provide timely refunds to passengers for flights to and from the United States during the COVID-19 pandemic.

Since March 2020, USDOT received over 1,200 complaints alleging British Airways failed to provide timely refunds. British Airways, which is owned by IAG, disputed the allegations.

USDOT said it would credit British Airways $550,000 toward the penalty because the airline in 2020 and 2021 issued more than $40 million in refunds to customers with nonrefundable tickets.

Ford Motor Co sued Blue Cross Blue Shield Association in U.S. court on Wednesday, accusing it of a price-fixing conspiracy that caused the automaker to pay inflated costs for health insurance products for its employees.

The lawsuit Ford filed in Detroit federal court accused the insurer and its regional Michigan branch of unlawfully dividing up parts of the country in a scheme to reduce competition with each other in order to drive "astronomical profits.

"The allegations from Ford, employing more than 170,000 workers worldwide, relate to a $2.7 billion settlement that Blue Cross Blue Shield Association and its three dozen member companies reached in 2020 with corporate and individual policy holders in Alabama federal court.

Ford opted out of that settlement, which is now on appeal at the Atlanta-based 11th U.S. Circuit Court of Appeals, in order to pursue its own claims. The appeals court agreed to fast-track its consideration of the settlement.

Weak profit forecasts from department store chain Macy's to discounter Dollar General on Thursday underscored the fragile health of the U.S. consumer as persistent inflation curbs spending.

Several U.S. retailers said sales have ebbed as consumers react to higher prices for food and other essentials. Broadly, U.S. consumer spending trends showed resilience in the face of high inflation, but big-ticket purchases suffered.

Upscale retailer Macy's said the U.S. consumer pulled back more than anticipated and slashed its annual sales and profit forecasts for the year. The glum forecast sent shares of the company down 4%.

Shares of major retailers are in a slump, with the S&P 500 Retail ETF down about 25% on Thursday since a recent peak in early February. The S&P 500 was flat during the same period.

Stellantis will invest 160 million euros ($176.13 million) at its Rennes plant to launch a 100% electric compact SUV in 2025, the Franco-Italian-American car manufacturer announced on Thursday.

Stellantis will use the investment to set up a battery assembly workshop as well as one dedicated to plastic injection, it said in a statement.

The U.S. Supreme Court on Thursday dealt another setback to organized labor by making it easier for employers to sue over strikes that cause property destruction in a ruling siding with a concrete business in Washington state that sued the union representing its truck drivers after a work stoppage.

The decision overturned a lower court's ruling that the lawsuit filed by Glacier Northwest Inc, which sells and delivers ready-mix concrete, against a local affiliate of the International Brotherhood of Teamsters was preempted by a U.S. law called the National Labor Relations Act. Glacier Northwest is a unit of Japan-based Taiheiyo Cement Corp. 5233.T

Glacier Northwest filed a lawsuit in Washington state court accusing the union of intentional property destruction during a 2017 strike.

A group of drivers went on strike while their mixing trucks were filled with concrete. Although the drivers kept their mixing drums rotating to delay the concrete from hardening and damaging the vehicles, the company was forced to discard the unused product at a financial loss.

Lucid Group said it plans to raise about $3 billion through a stock offering, nearly two-thirds of which will come from Saudi Arabia's Public Investment Fund (PIF), sending shares of the luxury electric-vehicle maker down 9% after market hours.

PIF, which owns more than 60% of the company, has agreed to buy 265.7 million shares in a private placement for about $1.8 billion, Lucid said, implying a price of about $6.80 per Lucid share, compared with the stock's Wednesday close of $7.76.

The remainder will be raised from a public offering of 173.5 million shares of common stock.

The additional funds are critical and come as the automaker, like its peers, struggles with mounting losses and tightening cash reserves amid recession fears and a price war sparked by market leader Tesla Inc.

The U.S. Medicare health plan will broaden coverage for new Alzheimer's drugs such as Eisai Co Ltd and Biogen Inc's Leqembi if they gain full U.S. approval, a federal agency said on Thursday.

Currently, Medicare, the government health plan for Americans 65 and over, will only pay for Alzheimer's disease drugs approved under the U.S. Food and Drug Administration's rigorous accelerated review if patients are enrolled in a clinical trial.

Broader Medicare coverage would begin on the same day the FDA grants traditional approval, the Centers for Medicare & Medicaid Services said.

Leqembi received accelerated approval from the FDA earlier this year and a decision on full approval is due by July 6.

Eli Lilly is also developing an Alzheimer's drug that targets amyloid brain plaques, similar to Eisai and Biogen's Leqembi.

Salesforce Inc fell 5% on Thursday after reporting quarterly revenue that increased at its slowest pace since 2010, with companies cutting back spending on cloud-based software offerings.

The enterprise software maker was set to shed nearly $12 billion in market value, based on its premarket share price of $211.39. The stock has risen nearly 69% this year, as of last close, making it the fourth-highest gainer in the S&P 500 index.

Salesforce on Wednesday posted its smallest rise in quarterly revenue in 13 years and predicted a further slowdown ahead, blaming an uncertain U.S. economy and weaker demand from financial services and tech companies.

Belt-tightening measures by businesses dealing with elevated levels of inflation and high interest rates have impacted tech spending this year, hitting growth at major cloud services players such as Amazon.com Inc.

Shares of Chewy Inc rose nearly 20% in premarket trading on Thursday after the online pet supplies retailer raised its annual revenue forecast and said it would enter the Canadian market.

The stock is set to claw back most of its year-to-date losses if gains hold through the session.

The company posted a surprise profit for the first quarter as its sales benefited from strong customer loyalty, prompting at least two brokerages to raise their price target.

The median price target of the 31 analysts covering the stock is $45, which is about 53% higher than the last closing price of $29.49.

Two months ago Bud Light rolled out its marketing push with transgender activist Dylan Mulvaney which has created a firestorm for shareholders in parent company Anheuser-Busch.

The House passed the debt ceiling and it now heads to the Senate. While the deal has many moving parts one of the most significant points is the impact to student loan borrowers.

Shares of Macy's, owner of Bloomingdale's, saw a sharp decline after the retailer said consumers are pulling back even more than before.

"We planned the year assuming that the economic health of the consumer would be challenged, but starting in late March, demand trends weakened further in our discretionary categories,” said Jeff Gennette, chairman and chief executive officer of Macy’s, Inc.