Category: 3. Business

(Bloomberg) — US stocks stepped back from record highs on Friday as consumer sentiment fell for the first time since April.

The S&P 500 Index closed down 0.3% in New York, pulling back from prior levels. The Nasdaq 100 Index fell 0.5%, while the Dow Jones Industrial Average advanced 0.1%.

The preliminary sentiment index for August dropped to 58.6 from 61.7 a month earlier, according to data from the University of Michigan that signaled concern President Donald Trump’s tariffs are likely to worsen inflation. Consumers expect prices to rise at an annual rate of 4.9% over the next year, more than economists had predicted.

“The inflation expectations component of the consumer confidence data was much higher than expected,” said Miller Tabak’s Matt Maley. “When you combine this with the much lower headline number, it renews concerns about stagflation. So, it’s not a surprise that investors are taking some profits today.”

Bill Adams, chief economist at Comerica Bank, said the consumer appears “mixed” so far in the third quarter. “While the data don’t all point in the same direction, the US economy looks to be in okay shape in the third quarter,” Adams said. “What consumers do is more important to the economy than what they say.”

Earlier data showed US retail sales rose in July in a broad-based advance, boosted by car sales and major online promotions. The value of retail purchases, not adjusted for inflation, increased 0.5% after an upwardly revised 0.9% gain in June, according to Commerce Department data released Friday. Excluding cars, sales climbed 0.3%.

Following the “explosive” PPI data on Thursday, Board’s Michelle Green said the retail sales confirm that costs are being successfully passed onto consumers.

“For equities, this creates a margin compression story: consumer-facing companies may sustain top-line growth, but rising input costs will pressure profitability, particularly in goods-heavy sectors,” Green said. “With 4.2% unemployment providing no justification for rate cuts, the Fed’s higher-for-longer stance becomes increasingly likely, keeping discount rates elevated and putting sustained pressure on valuations.”

Next week, investor focus will shift from economic data to the US central bank’s annual symposium in Jackson Hole, Wyoming, where Chair Jerome Powell is scheduled to speak.

Bank of America Corp. strategists led by Michael Hartnett expect US stocks to decline in the event of dovish signals from the Fed at Jackson Hole. A dovish tone from Powell at Jackson Hole could result in stocks sliding as investors “buy rumor, sell fact,” Hartnett said in a note.

Meanwhile, President Donald Trump is set to meet Russian President Vladimir Putin in Alaska for their first summit in seven years. Both leaders have very different measures of success for the talks: the US president wants a ceasefire in Ukraine, while getting face time without making any concessions is already a win for the Russian leader.

Among single stocks, UnitedHealth Group Inc. surged 12% after funds, including Berkshire Hathaway Inc., piled into shares of the troubled insurer. The investments are a welcome reprieve for a company that had seen its stock fall 46% this year.

The stock reaction for UnitedHealth, as well as the broader managed care sector, is likely a reflection of how “beaten down” the space has been this year, according to Daniel Barasa, portfolio manager at Gabelli Funds.

“Overall, I wouldn’t say that this is a definitive signal that the sector has reached a bottom, but it does suggest we may be approaching that point,” said Barasa.

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‘Nothing new’

George Yip, a distinguished visiting professor in international business and strategy in the D’Amore-McKim School of Business, breaks down the potential global impact of the agreement.

The White House’s recent deal with NVIDIA and AMD to get a cut of their chip sales to China is a sign that the U.S. is moving away “from free market capitalism to state-interventionist capitalism,” says a Northeastern international business expert.

This week, the Trump administration announced that it had come to an agreement with the two large US chipmakers to allow them to sell a select range of lower-powered AI chips designed for the Chinese market in exchange for a 15% cut of their sales in the country. The deal could bring in more than $2 billion to the U.S. government, The New York Times reported. 

The arrangement has been described as “highly unusual” and “unprecedented,” raising concerns from both Republicans and Democrats in Congress regarding its legality and national security implications. It comes months after the Trump administration initially placed sharp restrictions on the sale of AI chips in China. 

Northeastern Global News spoke with George Yip, a distinguished visiting professor in international business and strategy in the D’Amore-McKim School of Business, to understand its impact on global business.     

Can you speak on the nature of the deal and its implications?

It’s very strange, actually, and is not normally done. … What’s unusual is to apply a sort of export tax – and I consider this an export tax – on this. It’s a bit of a contradiction here. On the one hand, we’re so worried about sending them to China, a strategic rival, that we’re going to tax you. On the other hand, it’s not so important after all and it’s not going to hurt the U.S. It just strikes me as a way of raising tax money given that the deficit is too large. 

I think the bigger issue is that we are moving away from free market capitalism. There was a recent article in the Wall Street Journal that said the U.S. is becoming more like China in terms of state intervention capitalism. This is just another example of the state intervening in free market capitalism.   

What do you believe could be the second-order effects of such a deal? 

The second-order effect is that the government interfering with what companies do just slows down what they do. I think it’s one thing to review whether or not they can export to China. That’s a standard approach. Now we’re getting companies to pay to export, and it’s just adding a lot of bureaucracy and admin. It just means that business executives will spend more time lobbying the government to get exceptions. We are already seeing this with all the import taxes – I call them import taxes not tariffs. People are trying to get special concessions already. 

What does this deal mean for Nvidia and AMD?  

They want to make money out of selling something they made, right? This is their business. They make chips related to AI and other things. They are not stupid companies. They think it’s OK to sell these chips to China. They’re not afraid of creating competition, so it’s probably safe for them to do this. 

A woman shops at a local market in Ankara, Türkiye, on Aug. 14, 2025. (Mustafa Kaya/Handout via Xinhua)

by Burak Akinci

ANKARA, Aug. 15 (Xinhua) — In the bustling open-air market of capital city Ankara’s 100th Yil district, shoppers weave between stalls under a patchwork of canvas awnings, their eyes darting from price tags to their shopping lists.

The air is filled with the scent of ripe tomatoes, fresh herbs, and melons stacked high, but customers’ baskets remain light.

“We are buying less and less every week,” said Zeki Arin, an architect in his early 60s, clutching a bag containing just a few vegetables.

“The current annual inflation rate is around 30 percent, however, the impact of inflation is much more pronounced in our experience,” he lamented.

Despite the country’s inflation rate gradually declining in accordance with a consistent downward trend, Turks are continuing to reel from elevated food prices.

Arin said his family’s food purchases have been halved compared to a couple of years ago. “More and more, we buy what is the bare minimum and nothing else, sliced portions or by the piece rather than the kilogram.”

“I have never seen an economic crisis so deep in my life. Food prices have doubled compared to the same period last year,” he said.

According to official data, Türkiye’s food and non-alcoholic beverage prices rose 28 percent year-on-year in July. This is below the headline annual inflation rate of 33.5 percent, the lowest in nearly four years, but food inflation remains a daily concern for millions of households.

“Citizens’ purchasing power is not keeping pace with inflation, which remains very high despite the recent slowdown,” Istanbul-based independent economist Mustafa Sonmez told Xinhua.

“Even if the official rate is declining, prices remain at a level that severely limits what ordinary people can buy. The gap between wages and prices is widening, and this is what is feeding public frustration,” Sonmez said.

While policymakers forecast inflation could fall to around 24 percent by year’s end, many consumers expressed concerns about persistent cost-of-living pressures.

“Food prices are very high,” said Sevgi Binici, a retired teacher. “We wait until the late hours here because prices slightly drop in the evening.”

“I want to be hopeful for my children and grandchildren, but I cannot stop worrying about how I am going to manage to put food on the table,” she added.

Economists say the discrepancy between official inflation data and consumer sentiment stems partly from the way price changes affect different income groups.

Low-and middle-income households spend a larger share of their income on essentials like food and housing, categories that have seen some of the steepest increases in recent years, Sonmez explained.

“If something has doubled or tripled in price over the last few years, a slower increase now does not restore affordability,” he said. ■

People shop at a local market in Ankara, Türkiye, on Aug. 14, 2025. (Mustafa Kaya/Handout via Xinhua)

People shop at a local market in Ankara, Türkiye, on Aug. 14, 2025. (Mustafa Kaya/Handout via Xinhua)

The Privatisation Commission on Friday signed an agreement with financial advisers for the privatisation of Zarai Taraqiati Bank Limited (ZTBL), a statement from the Ministry of Privatisation said.

Founded in 1961 as the ADBP, it was renamed and incorporated as ZTBL in 2002 under the Companies Ord­inance 1984. The bank of­­fers agricultural credit and banking services to farmers nationwide and remains Pakistan’s largest public-sector agri lender.

Last month, the Board of the Privatisation Com­mission had approved the ap­­pointment of financial advisers for the divestme­nt of ZTBL, marking it as one of the government’s priority transactions in the current privatisation pipeline.

“The Privatisation Commission has signed a Financial Advisory Services Agreement (Fasa) with a consortium led by Next Capital Limited for the strategic privatisation of Zarai Taraqiati Bank Limited (ZTBL),” the statement said.

It added that the consortium also includes Ijaz Ahmed and Associates, Baker Tilly Mehmood Idrees Qamar, Executives Network International, Bridge Public Relations, Savills Pakistan Private Limited, and Prima Global Consulting Pvt Ltd.

“This initiative reflects the government’s unwavering commitment to inviting private sector investment, modernising banking operations, and ensuring the long-term sustainability of state-owned enterprises (SOEs),” the statement added.

According to the statement, post-privatisation, ZTBL, with its nationwide network of 501 branches, will be better positioned to deliver faster, more accessible credit to small farmers and rural communities.

It added that the bank will be able to “introduce modern banking technologies and digital solutions for agriculture financing as well as strengthen governance, transparency, and accountability, expand financial products tailored for emerging agribusiness opportunities and enhance customer service and on-ground responsiveness to meet farmers’ evolving needs”.

The privatisation of ZTBL is designed to catalyse investment in Pakistan’s agricultural future by combining private sector efficiency with ZTBL’s long-standing expertise in agricultural finance for fostering rural prosperity and ensuring farmers have timely access to essential financial resources.

Under the agreement, the financial advisers will conduct sell-side due diligence, carry out market sounding, engage with potential investors, structure the transaction, market it to investors, and assist the Privatisation Commission in a transparent bidding process, the ministry said.

The winning consortium had achieved the highest technical and financial score among six competing bidders, which incl­uded other leading groups headed by Arif Habib Ltd, AF Fergu­son, AKD Securities Ltd, Bri­­­­­dge Factor, and JS Bank.

The board also approved the formation of a nego­tiation committee to finalise the Fasa with the selected consortium.

Last month, the Senate Standing Committee on Privatisation had raised concerns over the government’s plans to privatise two state-owned entities — the Pakistan Mineral Development Corporation (PMDC) and ZTBL — and questioned the rationale behind their inclusion in the programme.