President Joe Biden wants to give low-wage workers a big raise – but the business community is urging Washington not to rush the first minimum wage hike since 2009.
In a letter to Congressional leaders, the Business Roundtable suggested for the first time that the minimum wage hike should be linked to progress in defeating the coronavirus pandemic.
“In the context of a major recession involving millions of small business job losses, this will require an appropriate phase-in and, potentially, triggers tied to the end of the pandemic,” Business Roundtable CEO Josh Bolten wrote in the Tuesday letter.
The Business Roundtable did not specify what those triggers would be.
Biden’s proposal to raise the minimum wage to $15 an hour, up from $7.25, has run into resistance by concerns it would hurt small businesses and cost jobs.
The Business Roundtable reiterated support for a federal minimum wage hike but said it should be “thoughtfully designed to reflect regional differences in wage rates and not undermine small business recovery.”
The group also repeated that the minimum wage debate should be separate from Biden’s $1.9 trillion Covid relief package so not to delay efforts to end the pandemic and boost the economy.
TJX (TJX), the owner of TJMaxx and Marshalls, said Wednesday that sales dropped during the holiday stretch as fewer consumers picked up clothes.
Sales at TJMaxx and Marshalls stores in the United States open for at least a year dropped 7% during the thirteen weeks ending January 30 compared with the same stretch last year.
Sales took a steeper fall in Europe and Canada, where some stores were temporarily closed last quarter because of the pandemic. TJX estimated these closures this took nearly $1 billion off sales during the quarter.
One bright spot for the company: HomeGoods, where US sales increased 12% last quarter.
TJX’s stock fell around 3% during pre-market trading.
Despite the sluggish holiday period, some analysts say TJX remains in strong shape in the long run.
“TJMaxx and Marshalls are in a good position. Consumers remain very value conscious and, once the pandemic is over, many will be unwilling to spend large amounts on clothing,” Neil Saunders, analyst at GlobalData Retail, said in a note to clients Wednesday.
Stocks opened lower again Wednesday morning, marking the third-straight day they have kicked off in the red.
Rising Treasury yields are again the culprit, climbing to 1.43%, or more than 0.06%. Investors will keep a close eye on Federal Reserve Chairman Jerome Powell’s testimony before the House Financial Services Committee later this morning. On Tuesday, Powell’s testimony in the Senate managed to move yields back down and gave the Dow and the S&P 500 room to finish higher.
We’re nearing the one year since the 10-year Treasury bond yield dropped below 1% for the first time ever — and things could not look more different.
US government bond yields are again heading higher today, as they have over the past sessions.
The 10-year bond last yielded 1.41%, up nearly .05%. (Bond yields and prices move in opposite directions.)
The sudden frenzy in the bond market comes on the back of rising interest rate expectations: Investors believe that the full reopening of the economy will bump up inflation and force the Federal Reserve to hike up rates sooner than previously thought.
But yesterday, Fed Chairman Jerome Powell testified before the Senate Banking Committee and reiterated that the central bank isn’t concerned about a sustained spike in inflation, even if there might be short-time spikes later this year.
Bond yields reversed their climb following Powell’s testimony yesterday.
Will we see the same move today? Powell is due to testify before the House Financial Services Committee at 10 am ET.
Home Depot (HD) reported earnings and sales that topped Wall Street’s forecasts Tuesday. Lowe’s (LOW) also reported better-than-expected earnings and sales on Wednesday morning, and CEO Marvin Ellison said in a statement that sales were lifted thanks to “broad-based demand driven by the continued consumer focus on the home.”
Still, rising interest rates could eventually be a problem for Home Depot and Lowe’s. Even though the Federal Reserve is expected to keep its key short-term rate near zero for the foreseeable future, longer-term bond yields have started to spike. And mortgage rates are influenced more by the 10-year Treasury than Fed rates.
In an ominous sign, Home Depot declined to give any guidance for 2021. Its shares fell 3% on the news.
US stock futures pointed toward a second straight day of gains. Investors remain concerned that rising bond yields are making risky stocks – particularly tech stocks – less attractive. Higher interest rates tied to bond yields could cut into companies’ profits. But testimony from Jerome Powell, which will continue Wednesday, boosted investors’ hope for a continuation of cheap money policies for the foreseeable future.
Here’s where things stand as of 6:15 am ET:
Stocks close mixed on Tuesday after spending much of the session deep in the red. The S&P 500 managed to snap a five-day losing streak, its worst in a year.
Rising Treasury bond yields, which track interest rate expectations, have been weighing on stocks. But 10-year US Treasuries yields were slightly lower at 1.36% at the time of the closing bell, having pared their earlier gains.
After a wild several weeks for GameStop, the retailer’s chief financial officer is resigning.
The company announced Tuesday that Jim Bell, its executive vice president and CFO, will resign from his roles on March 26.
GameStop (GME) has started searching for a new CFO “with the capabilities and qualifications to help accelerate GameStop’s transformation,” it said, hinting at the company’s efforts to shift its focus from physical to online retail.
The national unemployment rate is masking how much some groups are still struggling in the pandemic economy. That’s why the Federal Reserve looks at more than just the average jobless numbers to determine the nation’s economic health.
“When we say maximum employment is a broad and inclusive goal, we don’t only look at the headline numbers,” Fed Chairman Jerome Powell said in his semi-annual testimony to the Senate Banking Committee on Tuesday.
Some groups are bearing the brunt of the pandemic fallout, facing unemployment rates still higher than the national average, Powell told the committee.