U.S. futures slip, Yellen remarks, G7 tax agreement, Tesla Model S Plaid+, and more

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Wall Street

U.S. stock futures pointing to a negative start

U.S. stock futures were trading lower early Monday after the Dow Jones Industrial Average, S&P 500 and the Nasdaq posted slight gains last week following the May jobs report, which showed a less-than-anticipated gain.

The report, published by the Labor Department on Friday, showed that U.S. employers added 559,000 jobs last month, falling short of economists’ estimate for a gain of 650,000. Unemployment rate dropped to 5.8%, the lowest rate since March of last year, when unemployment was 4.4%.

By 5:20 a.m. ET, futures tied to the blue-chip Dow were indicated 13.5 points lower to 34,728.5. S&P 500 futures fell 8.87 points, or 0.21% to 0.21% to 4,219.38 while the tech-heavy Nasdaq 100 futures gave away 56.63 points, or 0.41% to 13,710.12.

Janet Yellen once again floats idea of hiking interest rates

Meanwhile, U.S. Treasury Secretary Janet Yellen has once again floated the idea of raising interest rates.

In an interview with Bloomberg News on Sunday, Yellen that if the U.S. “ended up with a slightly higher interest rate environment it would actually be a plus from society’s point of view and the Fed’s point of view.”

She told the news outlet that President Joe Biden’s $4 trillion spending proposal would benefit the U.S. economy, even if it resulted in higher interest rates and led to rising inflation.

Inflation discussions have intensified in recent months, between those who say trillions in federal stimulus could cause a lasting surge in costs, and critics who argue that current price increases are being triggered by transitory anomalies caused by the coronavirus pandemic.

G7 nations agree on a 15% minimum corporate tax rate

G7 nations have agreed to back a new global minimum tax rate of at least 15% that companies would have to pay irrespective of where they set up their headquarters.

Finance ministers from the G7 nations said on Saturday that the landmark deal would tackle tax avoidance by “the largest and most profitable multinational enterprises.”

“We … commit to a global minimum tax of at least 15 percent on a country by country basis,” the ministers said after their meeting in London.

Google (NASDAQ: GOOG), Amazon (NASDAQ: AMZN), Facebook (NASDAQ: FB) and other multinational companies could now be forced to pay taxes to countries based on where they sell their services or products, even if they don’t have physical offices in that country.

Tesla cancels Model S Plaid+

In other news, electric-vehicle maker Tesla (NASDAQ: TSLA) has cancelled plans to produce Model S Plaid+, the most expensive variant of its flagship sedan. CEO Elon Musk made the announcement in a tweet on Sunday, adding that Plaid is so good that another variant isn’t needed.

“Plaid+ is canceled. No need, as Plaid is just so good,” Musk wrote. “0 to 60mph in under 2 secs. Quickest production car ever made of any kind. Has to be felt to be believed.”

Tesla unveiled Model S Plaid+ during a battery event in 2020 where Musk said the car would adopt Tesla’s next-gen 4680 battery cells. It would have been the automaker’s most expensive model with a driving range of 520 miles.

As of this writing, Tesla stock was marked 1.34% lower to $591.00 per share in the pre-market trading session Monday.

 

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