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Wall Street ticks higher with hopes for coming cuts to interest rates

Summary

NEW YORK (AP) — Wall Street is drifting higher on Thursday as the countdown ticks to an update on the U.S. job market coming Friday, one that could clear the way for the cuts to interest rates that investors love.

The S&P 500 rose 0.4% as it clawed back more of its losses since setting an all-time high last week. The Dow Jones Industrial Average was up 180 points, or 0.4%, as of 11:30 a.m. Eastern time, and the Nasdaq composite was 0.4% higher.

Stocks got some lift from easing pressure from the bond market, where Treasury yields fell following the latest reports on the U.S. job market to come in worse than economists expected. One report suggested employers, not including the government, nearly halved their hiring last month. Another said that more workers applied for unemployment benefits last week in an indication of rising layoffs.

Neither number is flashing a recession, and a third report on activity for businesses in the information and other services industries showed a stronger-than-expected acceleration of growth.

The upside for investors of a slowdown in the job market is that it could push the to consider cutting its main interest rate for the first time this year at its next meeting in a couple weeks. Such cuts can give the economy and job market a kickstart, though they can also push inflation higher.

So far this year, the Fed has been keeping its main interest rate on hold because it’s been more worried about inflation potentially worsening because of President Donald ‘s tariffs than about the job market.

“The year started with strong job growth, but that momentum has been whipsawed by uncertainty,” according to Nela Richardson, chief economist at ADP. She said several things could be behind the slowdown, including ”labor shortages, skittish consumers, and AI disruptions.”

A more comprehensive report on the job market’s health during August will arrive on Friday from the U.S. Labor Department, and it will likely carry much weight with the Fed. Ahead of it, the yield on the 10-year Treasury fell to 4.19% from 4.22% late Wednesday.

Last month’s grim jobs report, which included massive downward revisions for June and May, sent financial markets spiraling and prompted Trump to fire the head of the agency that compiles the monthly data.

On Wall Street, American Eagle Outfitters jumped 32.3% after the teen fashion retailer reported more than double the profit that analysts had expected for its latest quarter. It benefited from a frenzy of media attention in late July over a provocative advertising campaign featuring actor Sydney Sweeney.

The ads — which featured the tagline “Sydney Sweeney has great jeans” — sparked a debate about race, Western beauty standards, and the backlash to “woke” American politics and culture.

Hewlett Packard Enterprise added 5.2% following its own better-than-expected profit report.

T. Rowe Price climbed 6% after announcing a deal where Goldman Sachs plans to buy up to $3.5 billion of its stock, or up to 3.5% of all its shares. They’re teaming up to offer access to some of the private markets where Goldman Sachs is an expert to the retirement savers and other investors that T. Rowe Price serves. Goldman Sachs added 1.3%.

On the losing side of Wall Street was Salesforce, which was one of the heaviest weights on the market despite reporting a better profit than analysts expected. Analysts called the performance solid but suggested some of it may have come from one-time factors. Salesforce, which helps businesses manage their customers, slumped 5.8%.

C3.ai fell 3.2% after reporting a larger loss for the latest quarter than analysts expected. Thomas Siebel called the results “completely unacceptable,” while announcing a new chief executive for the company, Stephen Ehikian. He was most recently acting administrator of the U.S. General Services Administration.

Figma tumbled 17.9% even though the company, which offers a design and product development platform, reported results for the latest quarter that roughly matched analysts’ expectations. Its forecasts for upcoming revenue also came close to analysts’, but expectations may have been even higher given that its stock came into the day at more than double its $33 IPO price from July.

In stock markets abroad, indexes were mixed across Europe and Asia.

Indexes dropped 1.3% in Shanghai and 1.1% in Hong Kong but jumped 1.5% in Tokyo.

US 30-year mortgage rate dips to 6.5% amid housing slump

Summary

  • Average 30-year U.S. mortgage rate drops to 6.5%
  • Down from 6.56% the previous week, reports
  • Rate was 6.35% a year ago, still higher than pre-2022 levels
  • Elevated keep in slump
  • Lower rates could improve buyer affordability, but sales lag

The average rate on a 30-year U.S. mortgage fell again this week, extending a recent trend that should give prospective  more purchasing power.

The long-term rate eased to 6.5% from 6.56% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.35%.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell. The average rate slipped to 5.6% from 5.69% last week. A year ago, it was 5.47%, Freddie Mac said.

Mortgage rates are influenced by several factors, from the ‘s interest rate policy decisions to bond market investors’ expectations for the economy and inflation.

Rates have been mostly declining since late July amid growing expectations that the Fed will cut its benchmark short-term interest rate at the central bank’s meeting of policymakers later this month.

A similar trend happened last year in the leadup to a year ago, when the Fed cut its rate in for the first time in more than four years. At that time, the average rate on a 30-year mortgage got down to a 2-year low of 6.08%, but then climbed again, reaching above 7% by mid-January.

While the Fed doesn’t set mortgage rates, its actions can influence bond investors’ appetite for long-term U.S. government bonds, like 10-year Treasury notes. Lenders use the yield on 10-year Treasurys as a guide to pricing home loans.

The 10-year Treasury yield was at 4.18% at midday Thursday, down from 4.22% late Wednesday.

In a high-profile speech last month, Federal Reserve Chair Jerome Powell signaled the central bank may cut rates soon even as inflation risks remain elevated because of the administration’s tariffs. That’s because of signs that the job market is slowing.

The government’s August job market snapshot is due out Friday.

Still, while a Fed rate cut could give the job market and overall economy a boost, it could also fuel inflation. That could push higher, driving mortgage rates upward in turn.

Hitachi Energy to invest $457M in Virginia expansion

SUMMARY:

  • to invest $457 million in , creating 825 jobs
  • Facility will be largest U.S. site for large power transformers supporting AI data centers
  • Investment is part of Hitachi’s $1 billion U.S. grid expansion amid rising demand

Hitachi Energy announced Thursday it will invest $1 billion to expand its U.S. grid infrastructure , with roughly half of that investment going into Virginia, where it plans to add 825 jobs.

The electrical equipment manufacturer will invest $457 million to build the nation’s largest manufacturing site for large power transformers in South Boston, Hitachi and announced. The large power transformers to be produced at the plant will support large-scale industrial applications like high-voltage transmission lines, power generation and fast-growing AI data centers.

Construction on the new South Boston plant will commence before the end of 2025 and the new manufacturing facility should be operational by 2028, a Hitachi spokesperson said.

“Thank you, Hitachi Energy, for trusting Virginia again,” the governor said in a statement. “Hard-working Virginians and a business-friendly environment are what first brought Hitachi Energy to the commonwealth. Now, after years of success here, they are doubling down on that decision with this landmark investment in South Boston.”

The new one plant will be built alongside Hitachi’s existing transformer manufacturing facility in South Boston, which has been in operation since 1968 and has 670 employees. In June 2024, Hitachi announced it would invest $26 million to expand that facility, creating about 100 jobs. This April, Hitachi also said it would invest $22.5 million to upgrade its Bland County facility and to add a warehouse in Atkins, creating 120 jobs.

“Power transformers are a linchpin technology for a robust and reliable electric grid and winning the AI race,” Hitachi Energy Andreas Schierenbeck said in a statement. “Bringing production of large power transformers to the U.S. is critical to building a strong domestic supply chain for the U.S. economy and reducing production bottlenecks, which is essential as demand for these transformers across the economy is surging. As the global leader in electrification, Hitachi Energy is uniquely positioned to deliver critical power solutions for the American market.”

The company’s investments in expanding its manufacturing capacity, including at South Boston, “are already creating good-paying American jobs, strengthening local communities, and reinforcing economic independence,”  Schierenbeck added. “At Hitachi Energy, we are deeply grateful for the and support of the , Gov. Youngkin, Virginia’s General Assembly, and the commonwealth’s congressional delegation, who came together to make this critical production capacity possible to power our energy future.”

The Virginia Economic Development Partnership, , the Southern Virginia Regional Alliance and the General Assembly’s Major Employment and Investment (MEI) Project Approval Commission secured the project for the state. Hitachi will be eligible to receive an MEI custom performance grant of $29.4 million for site preparation and facility costs, subject to approval by the General Assembly.

To provide housing options for the new employees Hitachi plans to hire, Youngkin announced that Halifax County and Virginia Housing are partnering to build 96 homes, supported by a grant from the Virginia Workforce Housing Investment Program. The county donated 10 acres of land near the energy facility and will waive permit and connection fees for housing construction.

The new South Boston facility is a component of the $1 billion Hitachi on Thursday announced it would be spending to expand its manufacturing efforts to meet the growing needs of U.S. power grid infrastructure. The company says the investments will help meet “skyrocketing energy demand” driven by AI data centers, which is in line with the Administration’s White House AI Action Plan that aims to increase electrical supply for the expansion of artificial intelligence.

Reuters reported in Dec. 2024, based on a Department of Energy-backed study, that U.S. data-center power demand could nearly triple in the next three years, consuming as 12% of the country’s electricity.

Headquartered in Switzerland, Hitachi Energy serves customers in the utility, industry, transportation, data centers and infrastructure sectors. In 2024, the company announced plans to invest more than $6 billion globally through 2027 to strengthen the resilience and capacity of the world’s electrical grids. The company employs around 50,000 people in 60 countries and generated annual revenue of approximately $16 billion for 2024.

Trump-backed bitcoin company begins trading on Nasdaq

Summary

A bitcoin treasury and mining company linked to the Trump family began trading Wednesday on the Nasdaq stock market.

American Bitcoin’s listing follows a completed merger with Gryphon Digital Mining. The company is backed by President Donald Trump’s sons, Donald Trump Jr. and Eric Trump.

“Our Nasdaq debut marks a historic milestone in bringing bitcoin into the core of U.S. capital markets,” Eric Trump said in a statement. He is a co-founder and chief strategy officer of American Bitcoin.

Public companies accumulating bitcoin as a corporate treasury has become a popular trend in crypto as the world’s most popular digital asset is priced near an all-time high. The parent company of Trump’s Truth Social has also moved to accumulate bitcoin.

American Bitcoin said it plans to use “self-mining operations and opportunistic bitcoin purchases” to stand out in a growing field.

Wednesday’s listing gives investors yet another chance to put money in a Trump-linked crypto project. The Trump family has made a heavy pivot from real estate into crypto in the last year with projects ranging from a U.S. dollar-backed stablecoin to the president hawking his own meme coin.

On Monday, another Trump-family backed crypto project, World Liberty Financial, launched public trading of its tokens. The popularity of such projects has put the value of the Trump family’s crypto holdings at several billion dollars, at least on paper.

Democrats have blasted the president for trying to monetize his popularity with crypto investors while also pushing for pro-crypto legislation and regulations. Trump has denied any improper conflicts of interest.

US job openings slip in July, adding to evidence that the American labor market is cooling

Summary

  • U.S. employers posted 7.2M in July
  • Openings fell from 7.4M in June, below forecasts
  • shows continues cooling
  • rose in July, signaling employer caution
  • held steady at 3.2M, showing worker confidence

WASHINGTON (AP) — U.S. employers posted 7.2 million job vacancies in July as the American labor market continues to cool.

The Labor Department reported Wednesday that job openings fell from 7.4 million in June and came in modestly below what economists had forecast. Healthcare and social assistance companies cut openings by 181,000 and retailers by 110,000.

The Job Openings and Labor Turnover Survey (JOLTS) showed that layoffs rose slightly. The number of Americans quitting their jobs — a sign of confidence in their ability to find better pay, opportunities or working conditions elsewhere — was unchanged from June at 3.2 million.

Jobs openings remain at healthy levels but have fallen steadily since peaking at a record 12.1 million in March 2022 as the U.S. economy roared back from COVID-19 lockdowns.

The U.S. job market has lost momentum this year, partly because of the lingering effects of 11 interest rate hikes by the inflation fighters at the in 2022 and 2023 and partly because President Donald ‘s trade wars have created uncertainty that is paralyzing managers making hiring decisions.

On Friday, the Labor Department will put out unemployment and hiring numbers for August. They are expected to show that businesses, government agencies and nonprofits added nearly 80,000 jobs last month, according to a survey of forecasters by the data firm FactSet. That would mark a modest improvement on the disappointing 73,000 they created in July.

Worse than the lackluster July hiring figures were Labor Department revisions that slashed a stunning 258,000 jobs off May and June payrolls. A furious Trump responded to the bad numbers by firing the head of the Bureau of Labor Statistics, the technocratic agency that compiles the statistics, and nominating a partisan idealogue to replace her.

So far this year, the economy has been generating 85,000 jobs a month, down from 168,000 last year and an average 400,000 a month during the hiring boom of 2021-2023.

In a time of uncertainty, employers are less likely to hire, but they’re not letting workers go either.

In a social media post Heather Long, chief economist at Navy Federal Credit Union, noted that jobs openings in July had come in below the number of U.S. unemployed (7.24 million) for the first time since April 2021. “This is yet another crack in the labor market that illustrates how much harder it is to get a new job right now than what we’ve seen in a long time,” she wrote.

Families of Boeing crash victims to make potential final plea for criminal prosecution

Summary

  • Federal court hearing underway in , Texas
  • Families seek prosecution in crash cases
  • Crashes in Indonesia and Ethiopia killed 346 people
  • Prosecutors say Boeing misled on flight-control system
  • Judge to weigh motion to dismiss felony conspiracy charge

FORT WORTH, Texas (AP) — Families of some of the 346 people killed in crashes of Boeing 737 Max jetliners held photos of their dead loved ones Wednesday outside a federal court in Texas, where a judge heard arguments on the U.S. government’s motion to dismiss its criminal case against the aerospace company in connection with the twin disasters.

U.S. District Chief Judge Reed O’Connor set aside time for the relatives to speak during the hearing, which lasted about three hours. Some traveled from countries in Europe and Africa to pursue what might have been their final opportunity to demand that the company face prosecution for the crashes off the coast of Indonesia and in Ethiopia.

“My daughter died on a new airplane that was defective and that was in operation because they weren’t complying with regulations and because of fraud,” said Nadia Milleron, a Massachusetts resident whose 24-year-old daughter, Samya Stumo, was among the 157 passengers and crew members killed in the Ethiopia crash. “I don’t want any other any other family member to lose their loved ones because of this kind of fraud.”

Boeing is charged with conspiracy to defraud the government, a felony. Prosecutors alleged the company deceived Federal Aviation Administration regulators about a flight-control system that was later implicated in the fatal flights, which happened less than five months apart in 2018 and 2019.

The judge said he would issue his decision on dismissal motion at a later date.

Wednesday’s hearing in Fort Worth came more than four years after the announced it had charged Boeing and reached a $2.5 billion settlement with the aircraft maker. That deal would have protected Boeing from criminal prosecution if it strengthened its ethics and legal compliance programs, but prosecutors revived the charge last year after deciding the company had violated certain terms of the agreement.

A new deal is struck

Boeing decided to plead guilty as part of a different agreement that would have avoided a public trial, but O’Connor rejected that deal in December. The judge, who was appointed by President George W. Bush, cited concerns he had over how diversity policies both at the federal government and at Boeing could influence the selection of an independent monitor charged with overseeing the company’s promised reforms.

Prosecutors spent months renegotiating with Boeing, and in late May, the two sides struck the latest deal that takes both the criminal charge and Boeing’s guilty plea off the table. In exchange, Boeing said it would pay or invest another $1.1 billion in fines, compensation for the crash victims’ families, and internal safety and quality measures.

The Justice Department said it offered those terms in light of “significant changes” Boeing has made to its quality control and anti-fraud programs since last summer. It said the agreement also served the public interest more effectively than taking the long-running case to trial and risking a jury verdict that might spare the company further punishment.

Victims’ families are divided

Chris and Clariss Moore of Toronto, whose 24-year-old daughter, Danielle, also died when a 737 Max crashed shortly after takeoff from Ethiopia’s Addis Ababa Bole International Airport, said in a statement that the pending agreement would allow Boeing to escape justice.

“The safety of passengers will be held in the balance,” the statement said.

Nearly 100 families oppose the agreement and want the judge to appoint a special prosecutor to take over the case since the Justice Department said it would not move forward with the charge even if O’Connor refuses to dismiss it, according to court documents.

Justice Department lawyers said the families of 110 crash victims either support resolving the case before it reaches trial or do not oppose the new deal. The Justice Department has asked the judge to leave open the possibility of refiling the conspiracy charge if the company does not hold up its end of the deal over the next two years.

While federal judges typically defer to the discretion of prosecutors in such situations, court approval is not automatic.

Faulty software is at the center of the case

The yearslong case centers around a software system that Boeing developed for the 737 Max, which began flying in 2017.

In both of the deadly crashes, that software pitched the nose of the plane down repeatedly based on faulty readings from a single sensor, and pilots flying for Lion Air and Ethiopian Airlines were unable to regain control. After the Ethiopia crash, the planes were grounded worldwide for 20 months.

Investigators found that Boeing did not inform key Federal Aviation Administration personnel about changes it had made to the software before regulators set pilot training requirements for the Max and certified the airliner for flight.

The initial 2021 settlement agreement was on the verge of expiring last year when a panel covering an unused emergency exit blew off a 737 Max during an Alaska Airlines flight over Oregon. No one was seriously injured, but it put Boeing’s safety record under renewed scrutiny.

UPDATES: to reflect that hearing has ended.

Wall Street steadies itself as Alphabet pulls tech stocks higher

Summary

  • S&P 500 rises 0.5%, breaking a two-day losing streak
  • jumps 7.1% after favorable antitrust ruling
  • Bond yields ease, calming market inflation worries
  • Macy’s soars 19.6% on strong quarterly earnings
  • sinks 9.7% despite profit beat

NEW YORK (AP) — is steadying on Wednesday as Alphabet and other technology stocks rise.

The S&P 500 added 0.3% and was on track to break its two-day losing streak since setting its latest all-time high. The Dow Jones Industrial Average was down 179 points, or 0.4%, as of 12:32 p.m. Eastern time, and the composite was 0.9% higher.

Google’s parent company was one of the strongest forces lifting the market and climbed 8.7% after avoiding some of the worst-case scenarios in its antitrust case. A federal judge on Tuesday ordered a shake-up of Google’s search engine but did not force a sale of its Chrome browser.

Because Alphabet is one of Wall Street’s most valuable companies, its stock movements carry more weight on the S&P 500 and other indexes than the typical company’s.

Also helping to steady Wall Street was a calming bond market. A day earlier, rising yields for government bonds around the world raised the pressure on the stock market. Yields climbed on worries about governments’ abilities to repay their growing mountains of debt, as well as concerns that President Donald ‘s pressure on the  to cut short-term interest rates could lead to higher inflation in the long term.

Such worries have pushed investors to demand higher yields in order to lend money to governments worldwide. And when bonds are paying more in interest, investors are less likely to pay high prices for stocks, which are riskier investments.

On Wednesday, Treasury yields retreated following the latest report on the U.S. job market to come in weaker than expected. The 10-year Treasury yield fell to 4.21% from 4.28% late Tuesday, for example.

The report showed that U.S. employers were advertising 7.2 million at the end of July, fewer than economists had forecast. The number bolsters the growing sense on Wall Street that the job market may be ossifying into a low-hire, low-fire state.

A weakened job market could push the Federal Reserve to cut its main interest rate for the first time this year at its next meeting, which is scheduled for later this month. That’s the widespread expectation among traders.

Lower interest rates could give the job market and overall economy a boost, along with prices for investments. The downside is that they can also push inflation higher when Trump’s tariffs may be set to raise prices for all kinds of imports.

Trading on Wall Street was mixed outside of , which benefited from the Alphabet ruling. Apple rose 3% after analysts highlighted how the ruling will still allow it to sign lucrative search deals with Google.

“This is a relief, an outcome that is much better than feared for Google and for Apple,” according to Chris Marangi, co-chief investment officer of value at Gabelli Funds.

Macy’s jumped 17.1% for one of the market’s bigger gains after the retailer reported stronger profit and revenue for the latest quarter than analysts expected. The owner of Bloomingdale’s delivered the best growth in an important measure of sales in three years, and it also raised its forecasts for sales and profit this fiscal year.

, a bitcoin treasury and mining company linked to the Trump family, shot up 28.1% in its first day of trading on the Nasdaq after completing a with Gryphon Digital Mining. Movements for its stock were so frenetic that trading was halted several times in the day’s first hour, and it more than doubled at one point.

Campbell’s rose 4.9% after the company behind the Goldfish and V8 brands reported a stronger profit for the latest quarter than analysts expected. It also said, though, that customers are continuing to be “increasingly deliberate” and that tariffs may help drag its overall earnings lower in its upcoming fiscal year.

On the losing end of Wall Street was Dollar Tree, even though the retailer reported better profit for the latest quarter than analysts expected. A chunk of its stronger-than-expected performance came because of the timing of tariffs, which could drag down its results in the current quarter.

Analysts also said expectations were high for the value retailer coming into its report. Its stock fell 7.1%, slicing into its gain for the year that came into the day at a stellar 48.6%.

In stock markets abroad, European indexes ticked higher following a weaker finish across much of Asia.

Japan’s Nikkei 225 fell 0.9% amid uncertainty about the political future of Japanese Prime Minister Shigeru Ishiba.

UPDATES: Updates trading

Mystery surrounds $1.2 billion Army contract to build huge detention tent camp in Texas desert

Summary

WASHINGTON (AP) — When President Donald Trump’s administration last month awarded a contract worth up to $1.2 billion to build and operate what it says will become the nation’s largest complex, it didn’t turn to a large government contractor or even a firm that specializes in private prisons.

Instead, it handed the project on a military base to Acquisition Logistics LLC, a small business that has no listed experience running a correction facility and had never won a federal contract worth more than $16 million. The company also lacks a functioning website and lists as its address a modest home in suburban Virginia owned by a 77-year-old retired Navy flight officer.

The mystery over the award only deepened last week as the new facility began to accept its first detainees. The Pentagon has refused to release the contract or explain why it selected Acquisition Logistics over a dozen other bidders to build the massive tent camp at Fort Bliss in West Texas. At least one competitor has filed a complaint.

The secretive — and brisk — contracting process is emblematic, experts said, of the government’s broader rush to fulfill the Republican president’s pledge to arrest and deport an estimated 10 million migrants living in the U.S. without permanent legal status. As part of that push, the government is turning increasingly to the military to handle tasks that had traditionally been left to civilian agencies.

A member of Congress who recently toured the camp said she was concerned that such a small and inexperienced firm had been entrusted to build and run a facility expected to house up to 5,000 migrants.

“It’s far too easy for standards to slip,” said Rep. Veronica Escobar, a Democrat whose district includes Fort Bliss. “Private facilities far too frequently operate with a profit margin in mind as opposed to a governmental facility.”

Attorney Joshua Schnell, who specializes in federal contracting law, said he was troubled that the Trump administration has provided so little information about the facility.

“The lack of transparency about this contract leads to legitimate questions about why the Army would award such a large contract to a company without a website or any other publicly available information demonstrating its ability to perform such a complicated project,” he said.

Ken A. Wagner, the president and of Acquisition Logistics, did not respond to phone messages or emails. No one answered the door at his three-bedroom house listed as his company’s headquarters. Virginia records list Wagner as an owner of the business, though it’s unclear whether he might have partners.

Army declines to release contract

Defense Secretary Pete Hegseth approved using Fort Bliss for the new detention center, and the administration has hopes to build more at other bases. A spokesperson for the Army declined to discuss its deal with Acquisition Logistics or reveal details about the camp’s construction, citing the litigation over the company’s qualifications.

The Department of Homeland Security, which includes U.S. Immigration and Customs Enforcement, declined for three weeks to answer questions about the detention camp it oversees. After this story was published Thursday, the department’s spokeswoman, Tricia McLaughlin, issued a statement that said “under President Trump’s , we are working at turbo speed on cost-effective and innovative ways to deliver on the American people’s mandate for of criminal illegal aliens.”

She said the Fort Bliss facility “will offer everything a traditional ICE detention facility offers, including access to legal representation and a law library, access to visitation, recreational space, medical treatment space and nutritionally balanced meals.”

Named Camp East Montana for the closest road, the facility is being built in the sand and scrub Chihuahuan Desert, where summertime temperatures can exceed 100 degrees Fahrenheit and heat-related deaths are common. The 60-acre (24-hectare) site is near the U.S.-Mexico border and the El Paso International Airport, a key hub for deportation flights.

The camp has drawn comparisons to “Alligator Alcatraz,” a $245 million tent complex erected to hold ICE detainees in the Florida Everglades. That facility has been the subject of complaints about unsanitary conditions and lawsuits. A federal judge recently ordered that facility to be shut down.

The vast majority of the roughly 57,000 migrants detained by ICE are housed at private prisons operated by companies like Florida’s Geo Group and Tennessee-based CoreCivic. As those facilities fill up, ICE is also exploring temporary options at military bases in California, New York and Utah.

At Fort Bliss, construction began within days of the Army issuing the contract on July 18. Site work began months earlier, before Congress had passed Trump’s big tax and spending cuts bill, which includes a record $45 billion for immigration detention. The Defense Department announcement specified only that the Army was financing the initial $232 million for the first 1,000 beds at the complex.

Three white tents, each about 810 feet (250 meters) long, have been erected, according to satellite imagery examined by The Associated Press. A half dozen smaller buildings surround them.

Setareh Ghandehari, a spokesperson for the advocacy group Detention Watch, said the use of military bases hearkens back to World War II, when Japanese Americans were imprisoned at Army camps including Fort Bliss. She said military facilities are especially prone to abuse and neglect because families and loved ones have difficulty accessing them.

“Conditions at all detention facilities are inherently awful,” Ghandehari said. “But when there’s less access and oversight, it creates the potential for even more abuse.”

Company will be responsible for security

A June 9 solicitation notice for the Fort Bliss project specified the contractor will be responsible for building and operating the detention center, including providing security and medical care. The document also requires strict secrecy, ordering the contractor inform ICE to respond to any calls from members of Congress or the news media.

The bidding was open only to small firms such as Acquisition Logistics, which receives preferential status because it’s classified as a veteran and Hispanic-owned small disadvantaged business.

Though Trump’s administration has fought to ban diversity, equity and inclusion programs, federal contracting rules include set-asides for small businesses owned by women or minorities. For a firm to compete for such contracts, at least 51% of it must be owned by people belonging to a federally designated disadvantaged racial or ethnic group.

One of the losing bidders, Texas-based Gemini Tech Services, filed a protest challenging the award and the Army’s rushed construction timeline with the U.S. Government Accountability Office, Congress’ independent oversight arm that resolves such disputes.

Gemini alleges Acquisition Logistics lacks the experience, staffing and resources to perform the work, according to a person familiar with the complaint who wasn’t authorized to discuss the matter and spoke on the condition of anonymity. Acquisition Logistics’ past jobs include repairing small boats for the Air Force, providing information technology support to the Defense Department and building temporary offices to aid with immigration enforcement, federal records show.

Gemini and its lawyer didn’t respond to messages seeking comment.

A ruling by the GAO on whether to sustain, dismiss or require corrective action is not expected before November. A legal appeal is also pending with a U.S. federal court in Washington.

A judge in that case denied a motion that sought to freeze construction at the site at a sealed hearing Thursday.

Schnell, the contracting lawyer, said Acquisitions Logistics may be working with a larger company. Geo Group Inc. and CoreCivic Corp., the nation’s biggest for-profit prison operators, have expressed interest in contracting with the Pentagon to house migrants.

In an earnings call this month, Geo Group Executive George Zoley said his company had teamed up with an established Pentagon contractor. Zoley didn’t name the company, and Geo Group didn’t respond to repeated requests asking with whom it had partnered.

A spokesperson for CoreCivic said it wasn’t partnering with Acquisition Logistics or Gemini.

Virginia 500: The 2025-26 Power List

Who are Virginia’s most powerful and influential leaders in business, government, politics and education this year? Find out in the sixth annual edition of the : The 2025-26 .

Read a note from our associate publisher about how we select the Virginia 500. 

Executives are listed in alphabetical order by industry. Below you will find links to each of the 21 categories featuring the state’s top leaders this year:

TowneBank completes $203M acquisition of Old Point

Suffolk-based announced Tuesday that it has closed its $203 million acquisition of Hampton-based National Bank of Phoebus and its parent company, Old Point Financial.

The , which went into effect Monday, cements TowneBank’s position as the bank with the highest market share in . The combined company now has total assets of $19.5 billion, loans of $13.1 billion and deposits of $16.3 billion based on financial information reported as of Dec. 31, 2024.

Old Point’s 13 bank branches will now operate as “Old Point National Bank, a Division of TowneBank” until February 2026, when the core systems and operations of Old Point National Bank are scheduled to be converted into those of TowneBank. Old Point Wealth Management will continue to offer its products and services as an addition to the TowneBank family of companies.

“We are honored to welcome Old Point to the Towne family, and look forward to upholding the legacy of the Shuford family in Hampton and beyond,” TowneBank Executive G. Robert Aston Jr. said in a statement.

Due to the merger, Old Point Chairman, President and Robert F. Shuford Jr. was appointed as TowneBank’s senior executive vice president. He will now serve as chairman of the TowneBank Peninsula board of directors beginning Jan. 1, 2026.

“The legal close of our merger marks the beginning of an exciting new chapter for Old Point and TowneBank,” Shuford said in a statement. “This partnership brings together two institutions deeply committed to serving our communities, employees and shareholders. We look forward to building a stronger future together.”

In August, TowneBank announced that it had signed an agreement to acquire North Carolina-based Dogwood State Bank for approximately $475 million. The transaction is expected to close in early 2026, pending regulatory approval and the approval of Dogwood’s shareholders.

Founded in 1999, TowneBank has more than 50 locations across Central and Eastern Virginia and North Carolina. It had total assets of $18.26 billion as of June 30.