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Townes-Whitley out as SAIC’s CEO after two years

SUMMARY:

  • has parted ways with the Fortune 500 contractor after two years as CEO
  • She was previously one of only two Black female CEOs leading Fortune 500 companies
  • Jim Reagan, a former Leidos executive and board member, is the company’s interim CEO

Toni Townes-Whitley is out as CEO of Fortune 500 government contractor (SAIC), the Reston-based business announced late Thursday.

Jim Reagan, former Leidos executive vice president and chief financial officer, has been installed as interim CEO, effective immediately. He has been part of SAIC’s board since 2023.

Townes-Whitley joined SAIC in 2023 as its chief executive and was one of only two current Fortune 500 CEOs who are Black women. She ranked No. 82 on Fortune’s 100 Most Powerful Women in Business list this year.

SAIC did not give a specific reason for Townes-Whitley’s departure.

Before coming to SAIC, she served as president of Microsoft’s U.S.-regulated industries, president of CGI Federal and held management roles at Unisys.

“It has been a privilege to lead SAIC and work with the company’s dedicated and talented people,” Townes-Whitley said in a statement. “I have collaborated closely with Jim during my time here, and I have the utmost confidence in his and the team’s ability to capitalize on and fully realize the company’s growth prospects. With its talented employees, SAIC is in good hands until a permanent CEO is appointed.”

Reagan previously held executive positions at Vencore, PAE, Aspect Communications, MCI Telecommunications, Nextel and AMS.

“Jim’s experience as a member of the SAIC board, together with his impressive track record in senior leadership roles across the industry, provides a cross-section of skills that make him well suited to serve as interim CEO,” said Donna Morea, the board’s chair. “SAIC has a solid, customer-focused foundation in place, supported by a strong qualified pipeline and planned submit levels and a backlog of pending awards. We are confident that under Jim’s stewardship, the company will improve performance while continuing to serve its valued customers by advancing the power of technology and innovation to serve and protect our world.”

SAIC employs about 24,000 people and has annual revenues of approximately $7.5 billion.

“It is an honor to be named interim CEO of SAIC,” Reagan said in a statement. “SAIC is well respected as a mission critical provider of technology and innovation, and I am excited to leverage my experience and expertise in the defense and government services industries at this terrific organization.

“With compelling opportunities ahead and continued momentum in our business development efforts, I am confident that SAIC is poised to deliver attractive growth and value creation. I look forward to working closely with the board, management and the whole SAIC team to deliver wins and shareholder value while strengthening the company’s foundation as we continue to position SAIC for the future.”

In June, SAIC received a $928 million U.S. Air Force contract to help provide warfighting prototypes for rapid acquisition. However, in July, SAIC lost a protest to remain in competition for a $972 million Air Force modeling and simulation contract.

Reston-based Fortune 500 contractor CACI International sued SAIC in July 2024, alleging breach of a subcontracting agreement, but the case was dismissed days before trial in September.

In its second quarter 2026 report released Sept. 4, the contractor reported $1.77 billion in earnings, approximately 3% lower than the same quarter in 2024, and Townes-Whitley said that “slower on-contract growth and continued delays in new business awards and new program ramps are contributing to a more challenging revenue environment than previously forecasted.”

She added in the September statement that the company anticipated the financial environment to remain stable but not improve this year.

The company’s stock performance also has lagged this year, opening Jan. 2 at $112.15 a share, dipping to $95.77 on March 3 and remaining well below its heights in the $140 to $150 range in late 2024. As of 11:15 a.m. Friday, SAIC’s stock price was at a low of $92.41 per share, down from $100.64 at Thursday’s close of trading.

In October, SAIC announced it had entered an agreement to acquire SilverEdge Government Solutions, a Maryland tech firm, for $205 million from private equity firm Godspeed Capital.

Townes-Whitley spoke at the Fortune Most Powerful Women Summit on Oct. 13, addressing her professional background and path to leadership of SAIC, as well as current trends in national security, including President ‘s proposed Golden Dome for America, to protect U.S. air space.

Asked about the unofficial name change from the Department of Defense to the Department of War, she said, “What’s important is that we respect the service, that we respect the individuals. Whatever we call the department, it’s important that we respect what these individuals do. The name — we can go left or right on the name — my whole focus is on support[ing] the warfighter.”

Stocks rise near records as oil surges on Russia sanctions

Summary

  • U.S. neared record highs Thursday, led by oil and gas shares.
  • jumped more than 5% after Trump sanctioned Russia’s crude sector.
  • Strong from Dow and Las Vegas Sands boosted investor sentiment.
  • rebounded, while rose ahead of inflation data.

NEW YORK (AP) — U.S. stocks rose to the cusp of their records. The S&P 500 climbed 0.6% Thursday and is just shy of its all-time high set earlier this month. The Dow Jones Industrial Average added 0.3% and was slightly below its own record. The composite rose 0.9%. Oil and gas stocks led the way as oil prices jumped more than 5%. announced new sanctions on Russia’s crude industry. Strong earnings reports from several big U.S. companies also lifted the market, including from Dow and Las Vegas Sands. Gold’s price halted a recent slide, while Treasury yields rose.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

NEW YORK (AP) — U.S. stocks are rising to the cusp of their records on Thursday, as oil prices jump after President Donald Trump announced “massive” new sanctions on Russia’s crude industry.

The S&P 500 climbed 0.7% and crept back within 0.1% of its all-time high set earlier this month. The Dow Jones Industrial Average added 192 points, or 0.4%, and was just below its own record set earlier this week. The Nasdaq composite was 1% higher, with a little less than an hour remaining in trading.

Companies in the oil and gas business led the way, including gains of 1.5% for Exxon Mobil, 3% for ConocoPhillips and 4% for Diamondback Energy. They rose with prices for crude, which leaped roughly 5.5% after Trump announced sanctions against Russian oil giants Rosneft and Lukoil.

The hope is to convince Russia’s president, Vladimir Putin, to end the brutal war with Ukraine, and sanctions could constrict the global flow of oil. The jumps helped oil prices recover some of their sharp recent losses, taken because of expectations for supplies of crude in inventories to remain plentiful. Oil prices are still down more than 10% for the year so far.

Also helping to drive the higher were strong profit reports from several big U.S. companies, as the reporting season for their profits during the summer ramps up. The majority are topping ‘s forecasts for profit, as is usually the case.

Dow jumped 12.5%, and Las Vegas Sands rallied 13.6% after both delivered stronger earnings than analysts expected. Tesla shook off an early loss to climb 1.1% in its first trading after reporting a weaker profit but also stronger revenue for the latest quarter than analysts expected.

The pressure is on companies broadly to deliver solid growth in profits. That would counter criticism that their stock prices shot too high following a 35% romp for the S&P 500 from a low in April.

On the losing end of Wall Street, Molina Healthcare tumbled 17.9% after its profit for the latest quarter fell well short of analysts’ expectations. CEO Joseph Zubretsky cited a challenging environment for medical costs, and insurers across the industry have been warning about rising medical costs throughout the year.

IBM fell 1.7%, despite reporting better profit and revenue than analysts expected. Wall Street focused instead on weaker-than-expected results for its Red Hat business, which provides open-source software products.

In the gold market, prices strengthened to halt a sharp recent slide. The price for an ounce climbed 2% to $4,145.60 per ounce.

It had dropped sharply the last two days after setting its latest all-time high, as momentum suddenly gave out following what’s been a stunning year. The price of gold has jumped about 57% so far in 2025.

Many of the factors that have sent gold on its monumental rise are still around, including concerns about the mountains of debt that the U.S. and other governments worldwide are amassing. The U.S. government’s gross national debt topped $38 trillion on Wednesday, and the worry is that a continued acceleration will only worsen inflation.

In the bond market, the yield on the 10-year Treasury rose to 3.99% from 3.97% late Wednesday. That was ahead of a report coming on Friday that will show how much inflation U.S. consumers felt during September. The report was initially due earlier this month but was delayed because of the U.S. government’s shutdown.

If the reading ends up benign, it could encourage the Federal Reserve to keep cutting interest rates in hopes of giving the slowing job market a boost. It delivered its first cut of the year last month, but it’s been wary of promising many more because lower rates can make inflation worse.

In stock abroad, indexes rose across Europe following a more mixed finish in Asia.

Stocks rose 0.7% in Hong Kong and 0.2% in Shanghai as leaders in Beijing wrapped up an important Communist Party meeting to set the agenda for the coming five years. The party said afterward that it will focus on speeding up self-reliance in science and technology.

Japan’s Nikkei 225 dropped 1.4%, and South Korea’s Kospi sank 1% for two of the world’s larger losses.

Appalachian Power announces rate reduction

SUMMARY: 

  • State Corporation Commission approved interim fuel factor rate
  • Average resident customer will see $10 drop in monthly bill
  • Appalachian Power has requested to issue about $1.4 billion in securitized utility bonds

The average Appalachian Power residential customer in Virginia will soon see about a $10 drop in their monthly bill, according to an announcement made Wednesday by the public utility subsidiary of Ohio-based Co.

On Oct. 9, Virginia’s State Corporation Commission, which has regulatory authority over utilities, approved an interim fuel factor rate of 3.1 cents per kilowatt-hour for service rendered on and after Nov. 1 . The current rate is 4.1 cents. The fuel factor represents the cost of fuel used to generate electricity.

Appalachian Power requested the decrease Sept. 12.

“This is what we expect fuel to cost for our customers for the year moving forward,” George Porter, a spokesperson for Appalachian Power, said Thursday.

The fuel factor makes up about 20% of a residential customer’s electric bill, according to the utility.

“We were coming off the post-COVID years, the war in Ukraine … so we expect fuel to go down a little bit,” Porter said.

To comply with the , the 2020 law that mandates zero emissions in energy production by 2050, Appalachian Power is bringing on more renewables.

“That’s less need for fuel,” he said.

The utility serves about 550,000 customers in central and southwestern Virginia.

By the end of this month, Appalachian Power expects to have an unrecovered deferred balance of about $62.2 million in fuel costs. In October 2023, it had a deferred fuel balance of about $273.2 million.

The will issue a final order following a public hearing on March 3.

Signed by Gov. Glenn Youngkin in March, House Bill 2621 went into effect July 1.

Championed by Southwest Virginia lawmakers concerned about their constituents’ electric bills, the law allowed for securitization to reduce monthly bills, placed a six-month moratorium on interest and late fees and a nine-month freeze on disconnect and reconnect fees, and prohibited rate increases during the winter.

The SCC held a public hearing Oct. 1 on Appalachian Power’s request to issue about $1.4 billion in securitized utility bonds. The financing will cover about $141 million in Appalachian Power’s storm recovery costs from Jan. 1, 2024, to March 31, 2025. It will also finance about $1.2 billion to cover Virginia’s share of the unrecovered building balances on the coal-fired John Amos and Mountaineer power plants in West Virginia.

Normally, customers would foot these costs in their monthly bills. By using this method of financing, which has a favorable interest rate, a customer using 1,000 kilowatt-hours could save about $11.44 a month.

Virginia garden center lays off 97 after $160M sale to data center developer

Merrifield Garden Center will shut down its Gainesville facility this December, laying off 97 employees, following a $160 million sale of the 34-acre property to a private equity firm specializing in developing .

Founded in 1971 and headquartered in , Merrifield Garden Center has three locations with 600 employees, including the workers who are being laid off. The Gainesville property, which includes a garden retail store, was sold Oct. 14 to a limited liability company affiliated with Washington, D.C.-based private equity firm TheBlackChamber Group formed in 2019.

Merrifield Garden Center notified the state of the Gainesville store’s closing and the 97 last week in a letter complying with the (WARN) Act.

In a letter to the Virginia Works agency, corporate operations manager David Watkins notes that the 6895 Wellington Road site, near , will close Dec. 31. The garden center property is within an area designated as a opportunity zone district, allowing data centers to be built without a rezoning vote.

TheBlackChamber Group specializes in developing data center properties and has made major investments in land for data centers in Northern Virginia, especially Loudoun and Prince William counties, according to Data Center Map. The investment firm did not immediately return a request for comment.

The Merrifield Garden Center plant’s will impact 97 employees, including positions in , management, drivers, cashiers, crew and yard work. The letter said the layoffs are expected to be permanent and that there is no job bumping system.

Watkins declined to discuss the reasons for the plant’s closure, citing a contract. Regarding the company’s future, he said the company hopes to remain open at the other two locations “for a long time.”

Trump pardons Binance founder Changpeng Zhao

Summary

  • President pardoned founder Changpeng “CZ” Zhao.
  • Zhao served prison time for compliance failures tied to criminal money transfers.
  • The pardon follows months of lobbying and support from allies.
  • Binance and Zhao have been key backers of Trump family crypto ventures.

WASHINGTON (AP) —  has pardoned Binance founder , who created the world’s largest exchange and served prison time for failing to stop criminals from using the platform to move money connected to child sex abuse, drug trafficking and terrorism.

The pardon caps a monthslong effort by Zhao, a billionaire commonly known as CZ in the crypto world and one of the biggest names in the industry. He and Binance have been key supporters of some of the Trump family’s crypto enterprises.

“Deeply grateful for today’s pardon and to President Trump for upholding America’s commitment to fairness, innovation, and justice,” Zhao said on social media Thursday.

Zhao’s pardon is the last move by a president who has flexed his executive power to bestow clemency on political allies, prominent public figures and others convicted of crimes.

White House press secretary Karoline Leavitt asserted in a statement Thursday that Democratic President Joe Biden’s administration prosecuted Zhao out of a “desire to punish the cryptocurrency industry” and that there were “no allegations of fraud or identifiable victims.”

The crypto industry has long complained it was subject to a “regulation by enforcement” ethos under the Biden administration. Trump’s pardon of Zhao fits into a broad pattern of the his taking a hands-off approach to an industry that spent heavily to help him win the election in 2024. His administration has dropped several enforcement actions against crypto companies that began during Biden’s term and disbanded the crypto-related enforcement team at the Justice Department.

Former federal prosecutor Mark Bini said Zhao went to prison for what “sounds like a regulatory offense, or at worst its kissing cousin.”

“So this pardon, while it involves the biggest name in crypto, is not very surprising,” said Bini, a white collar defense lawyer who handles crypto issues at Reed Smith.

Zhao was released from prison last year after receiving a four-month sentence for violating the Bank Secrecy Act. He was the first person ever sentenced to prison time for such violations of that law, which requires U.S. financial institutions to know who their customers are, to monitor transactions and to file reports of suspicious activity. Prosecutors said no one had ever violated the regulations to the extent Zhao did.

The judge in the case said he was troubled by Zhao’s decision to ignore U.S. banking requirements that would have slowed the company’s explosive growth.

“Better to ask for forgiveness than permission,” was what Zhao told his employees about the company’s approach to U.S. law, prosecutors said. Binance allowed more than 1.5 million virtual currency trades, totaling nearly $900 million, that violated U.S. sanctions, including ones involving Hamas’ al-Qassam Brigades, al-Qaida and Iran, prosecutors said.

“I failed here,” Zhao told the court last year during sentencing. “I deeply regret my failure, and I am sorry.”

Zhao had a remarkable path to becoming a crypto billionaire. He grew up in rural China and his family immigrated to Canada after the 1989 Tiananmen Square massacre. As a teenager, he worked at a McDonald’s and became enamored with the tech industry in college. He founded Binance in 2017.

In addition to taking pro-crypto enforcement and regulatory positions, the president and his family have plunged headfirst into making money in crypto.

A stablecoin launched by World Liberty Financial, a crypto project founded by Trump and sons Donald Jr. and Eric, received early support and credibility thanks to an investment fund in the United Arab Emirates using $2 billion worth of World Liberty’s stablecoin to purchase a stake in Binance. Stablecoins are a type of cryptocurrency that are typically tied to the value of the U.S. dollar.

A separate World Liberty Finance token saw a huge spike in price Thursday shortly after news of the pardon was made public, with gains that far outpaced any other major cryptocurrency, according to data from CoinMarketCap.

Zhao said earlier this year that his lawyers had requested a pardon.

It is not immediately clear what impact Trump’s pardon of Zhao may have for operations at Binance and Binance.US, a separate arm of the main exchange offering more limited trading options to U.S. residents.

Northern Virginia sees return to office spike

SUMMARY:

  • Office attendance in hit 72% of pre-pandemic levels in September
  • Q3 fell from $558 million to $158 million, likely due to seasonal factors
  • Trophy offices saw rent gains; others stayed flat

A surge in return-to-office activity is helping Northern Virginia’s office market stay resilient, even as property sales dipped in the third quarter, a new report from services firm shows.

The report found that, as of August, office attendance in Northern Virginia had reached 64.8% of pre-pandemic levels, surpassing the national average of 61.3%. Even more recent data provided this week by Avison Young shows the trend continuing, with attendance in the region climbing to 72.2% in September, underscoring the impact of renewed return-to-office mandates.

“While month-to-month visitation recovery is volatile, the positive trendline is indicative of a slow yet steady recovery,” the report noted.

Graham Sessoms, a senior market intelligence analyst with Avison Young, said the federal government and defense employers are leading the surge. Government contractors that want to follow the government’s lead “do what they do to keep in lockstep with them,” he added. Earlier this year, the signed an executive order requiring federal agencies to terminate remote work arrangements.

Finance and life sciences firms are also reinforcing in-office culture, Sessoms said, either because the businesses prefer in-person communication or because it’s is necessary for employees to conduct research in person.

Tucker White, Avison Young’s U.S. office agency lead for market intelligence, noted, “It’s hard to convince the taxpayer that the government works better remote.” And “you can’t just take your laptop home if you have any security-level clearance,” he added. “You need to be in the office.”

Despite the return-to-office increase, sales volume declined sharply, falling from $558 million in the second quarter of the year to $158 million in the third quarter. Despite the drop, White said it’s not unusual for in their third quarter to drop at this time of year, attributing much of the drop to seasonal lulls. He added that recent fluctuations in interest rates may have led some building owners to delay sales. Private investors remained the dominant buyer group in the third quarter.

Meanwhile, the share of available to be leased tightened to 23.3%, down from 24.4% in Q2. Sublease availability also declined to 3.2 million square feet, while vacant sublease inventory held steady at about 1.62 million square feet. By comparison, about 2.1 million square feet of vacant sublease space was available at the beginning of 2024.

Ryan Price, chief economist with Virginia Realtors, has said that during the pandemic, many companies reduced their office space because fewer people were coming in, leading to a spike in sublease listings. But as more firms have started bringing employees back to the office under return-to-office policies, that trend has begun to reverse.

Trophy office space is the only property class to have seen a rise in rents since the beginning of 2023, with trophy offices averaging $70.72 per square foot, up slightly year-over-year. All other types of office space have seen stagnant rent prices, with Class A averaging $43.14, Class B $35.52 and Class C $27.83. The firm previously said this year that the higher price for trophy assets was driven by a significant reduction in available supply and continued tenant preference for high-quality space.

“The top end of the market has been performing very well,” Sessoms said. “Rents have increased substantially. Occupancy is high there, and availability has been slowly shrinking.”

Another significant development is the rise in conversions from office space to residential, with 12.9 million square feet — about 7.9% of the region’s inventory — slated to be repurposed. Out of 70 proposed buildings to be converted to residential use, 8.57% have either been approved or begun construction. Avison Young says this trend reflects growing interest in repurposing underperforming assets, often acquired at a discount due to financial challenges faced by landlords in recent years.

Sessoms said many of the buildings being converted were “not in a great place” and needed renovations anyway.

Ultimately, despite the dip in sales, Northern Virginia’s office market is in a healthy place and is seeing positive momentum, White and Sessoms said.

“There’s a lot to be excited about for both landlords and tenants,” Sessoms said. “Most tenants that we’re talking to, clients and nonclients, they are generally increasing their footprint or at least considering to do so at a higher rate than they have previously. So, [there’s] a lot to be excited about and hopeful for in the near future, throughout the rest of this year and in the next, as well.”

Shutdown fight renews debate over health subsidies

Summary

WASHINGTON (AP) — The government shutdown has reopened debate on what has been a central issue for both major political parties in the last 15 years: the future of health coverage under the Affordable Care Act.

Tax credits for people who get health insurance through the marketplaces created by the Affordable Care Act, also known as Obamacare, expire at the end of the year.

Democrats say they won’t vote to reopen the government until negotiate an extension of the expanded subsidies. Republicans say they won’t negotiate until Democrats vote to reopen the government. Lawmakers in both parties have been working on potential solutions behind the scenes, hoping that leaders will eventually start to talk, but it’s unclear if the two sides could find compromise.

As circles the issue, a poll from The Associated Press-NORC Center for Public Affairs Research found that about 6 in 10 Americans are “extremely” or “very” concerned about their health costs going up in the next year. Those worries extend across age groups and include people with and without health insurance, the poll found.

A look at the subsidies that are expiring, the politics of the ACA and what Congress might do:

Enhanced premium help during the pandemic

Passed in 2010, the ACA was meant to decrease the number of uninsured people in the country and make coverage more affordable for those who don’t have private insurance. The law created state by state exchanges, some of which are run by the individual states, to try to increase the pool of the insured and bring down rates.

In 2021, when Democrats controlled Congress and the White House during the COVID-19 pandemic, they expanded premium help that was already in the law. The changes included eliminating premiums for some lower-income enrollees, ensuring that higher earners paid no more than 8.5% of their income and expanding eligibility for middle-class earners.

The expanded subsidies pushed enrollment to new levels and drove the rate of uninsured people to a historic low. This year, a record 24 million people have signed up for insurance coverage through the ACA, in large part because billions of dollars in subsidies have made the plans more affordable for many people.

If the tax credits expire, annual out-of-pocket premiums are estimated to increase by 114% — an average of $1,016 — next year, according to an analysis from KFF.

Democrats push to extend subsidies

Democrats extended those tax credits in 2022 for another three years but were not able to make them permanent. The credits are set to expire Jan. 1, with Republicans now in full control.

Lacking in power and sensing a political opportunity, Democrats used some of their only leverage and forced a government shutdown over the issue when federal funding ran out on Oct. 1. They say they won’t vote for a House-passed bill to reopen the government until Republicans give them some certainty that the subsidies will be extended.

Democrats introduced legislation in September to permanently extend the premium tax credits, but they have suggested that they are open to a shorter period.

“We need a serious negotiation,” Senate Democratic leader Chuck Schumer has repeatedly said.

Republicans try to scale the ACA back, again

The Democratic demands on health care have reignited longstanding Republican complaints about the ACA, which they have campaigned against for years and tried and failed to repeal in 2017. Many in the party say that if Congress is going to act, they want to scrap the expanded subsidies and overhaul the entire law.

The problem is not the expiring subsidies but “the cost of health care,” Republican Sen. Rick Scott of Florida said Tuesday.

In a virtual briefing Tuesday, the libertarian Cato Institute and the conservative Paragon Health Institute branded the subsidies as President Joe Biden’s “COVID credits” and claimed they’ve enabled fraudsters to sign people up for fully subsidized plans without their knowledge.

Others have pitched more modest proposals that could potentially win over some Democrats. Senate Majority Leader John Thune, R-S.D., has said he is open to extending the subsidies with changes, including lower income limits and a stop to auto-enrollment that may sign up people who don’t need the coverage.

The ACA is “in desperate need of reform,” Thune has said.

House Republicans are considering their own ideas for reforming the ACA, including proposals for phasing out the subsidies for new enrollees. And they have begun to discuss whether to combine health care reforms with a new government funding bill and send it to the Senate for consideration once they return to Washington.

“We will probably negotiate some off-ramp” to ease the transition back to pre-COVID-19 levels, said Maryland Rep. Andy Harris, the head of the conservative House Freedom Caucus, during a virtual town hall Tuesday.

Is compromise possible?

A number of Republicans want to extend the subsidies. Sen. Josh Hawley, R-Mo., said most people who are using the exchanges created by the ACA “don’t really have another option, and it’s already really, really expensive. So I think there are things we can do to reform the program.”

Hawley said he had been having conversations with other senators about what those changes could be, including proposals for income limits, which he said he sees as a “very reasonable.”

Bipartisan groups of lawmakers have been discussing the income limits and other ideas, including making the lowest-income people pay very low premiums instead of nothing. Some Republicans have advocated for that change to ensure that all enrollees are aware they have coverage and need it. Other proposals would extend the subsidies for a year or two or slowly phase them out.

It’s unclear if any of those ideas could gain traction on both sides — or any interest from the White House, where has remained mostly disengaged. Despite the public stalemate, though, lawmakers are feeling increased urgency to find a solution as the Nov. 1 open enrollment date approaches.

Democratic Sen. Jeanne Shaheen of New Hampshire has been talking to lawmakers since the shutdown began, trying to find areas of compromise. On Tuesday, she suggested that Congress could also look at extending the enrollment dates for the ACA since Congress is stalled on the subsidies.

“These costs are going to affect all of us, and it’s going to affect our health care system,” she said.

Union Pacific profit rises 7% as merger push continues

Summary

  • earned $1.79B in Q3, up 7% year over year
  • CEO promotes $85B merger with
  • Deal would create the first transcontinental U.S. railroad
  • , chemical shippers raise competition concerns

OMAHA, Neb. (AP) — Union Pacific delivered 7% growth in its third-quarter Thursday as its CEO continues to make the case for the potential benefits of acquiring one of the railroad’s eastern rivals.

The Omaha, Nebraska-based railroad said it earned $1.79 billion, or $3.01 per share, in the quarter. That’s up from $1.67 billion, or $2.75 per share, a year ago. And without $41 million in merger costs the railroad would have made $3.08 per share but either number would have beat the estimates of $2.97 per share.

Union Pacific wants to buy Norfolk Southern in a $85 billion deal that would create the first transcontinental railroad. That deal faces a lengthy review by the U.S. Surface Board before the companies would be able to merger Union Pacific’s vast network in the West with Norfolk Southern’s operation in the Eastern United States. Norfolk Southern will report its earnings Thursday afternoon.

Union Pacific CEO Jim Vena wrote a letter to employees reiterating that he thinks the merger is great for America because it would enable the railroad to deliver goods more quickly and help the companies that rely on its deliveries of raw materials and finished products.

He said other railroads that have come out against the merger like BNSF tend to look backward at the problems that followed past mergers in the 1990s while he is looking forward to finding the best way to compete against trucks and respond to advancements in technology. The merger has picked up support from the largest rail union and a number of shippers, but other companies — particularly chemical producers — have said they think the deal will hurt competition and lead to higher rates.

“While Union Pacific has good opportunities to grow, the rail industry is going to be challenged by technology in the trucking and shipping industries,” Vena wrote. “Union Pacific continues to invest in technology, but if we truly want to compete and grow the business, we must have a network that is set up to provide seamless service at a cost-effective price, positioning manufacturers to win in the marketplace.”

BNSF sent a letter to its customers last month urging them to express their concerns about the merger to the STB because that railroad, which is owned by Warren Buffett’s Berkshire Hathaway, believes the combination would hurt competition in the industry. BNSF has said it believes railroads can better serve their customers by cooperating instead of undertaking costly and complicated mergers.

CPKC and Canadian National railroads have also come out in favor of more cooperative agreements instead of mergers, but President has said the deal sounds good to him.

Union Pacific said it remains on track to deliver profits this year in line with its three-year goal for high-single digit to low double-digit growth.

This quarter the railroad was able to deliver 3% growth in revenue largely through higher rates even though the number of carloads it delivered was essentially flat.

Stocks, gold fall as Wall Street momentum fades

Summary

  • dropped 0.5%, still near its all-time high
  • Dow fell 0.7%, slid 0.9%
  • profit miss weighed on
  • Gold fell for second day after reaching record high

NEW YORK (AP) — U.S. and the price of gold fell on Wednesday, as momentum on reverses.

The S&P 500 sank 0.5%, though it’s still within 1% of its all-time high set earlier this month. The Industrial Average dropped 334 points, or 0.7%, from its record set the day before, while the Nasdaq composite fell 0.9%.

Netflix helped drag the market lower after delivering a weaker profit for the latest quarter than analysts expected. The pressure is on the video streamer and on companies broadly to deliver solid growth in profits. That would counter criticism that their stock prices shot too high following a 35% romp for the S&P 500 from a low in April.

Netflix’s stock came into the day with a jump of 39.3% for the year so far, more than double the S&P 500’s gain, before it dropped 10.1% on Wednesday.

AT&T fell 1.9% after delivering a profit that only matched analysts’ expectations, while Texas Instruments sank 5.6% after its profit fell just short of forecasts.

On the winning side of Wall Street was Intuitive Surgical, which sells robotic-assisted surgical systems. It jumped 13.9% after reporting better profit for the latest quarter than analysts expected. Boston Scientific climbed 4% after likewise topping analysts’ profit expectations.

Capital One Financial rose 1.5%, and Western Alliance Bancorp climbed 3.2% following their own profit updates that beat analysts’ expectations. The report from Western Alliance was particularly welcome after it helped shake confidence in the industry last week. It’s one of several banks that had warned of potentially bad loans on its books, possibly because of fraud.

, meanwhile, swung sharply through a manic Wednesday. After surging as much as 112% in the morning, its stock erased all of that to finish with a drop of 1.1%. It’s still up 454.5% for the week so far in the midst of its meme-stock run.

The maker of plant-based meat alternatives was the biggest holding in the Roundhill Meme Stock exchange-traded fund, as of Tuesday. The ETF holds stocks where investors have piled in because they’re hoping to catch a wave of momentum, almost regardless of how or even what the businesses themselves are doing.

All told, the S&P 500 fell 35.95 points to 6,699.40. The Dow Jones Industrial Average dropped 334.33 to 46,590.41, and the Nasdaq composite sank 213.27 to 22,740.40.

Momentum continued to head the other way for gold, which fell 1.1% to $4,065.40 per ounce. That’s after Tuesday’s 5.3% slide knocked it off its record high.

Many of the same factors that drew buyers to gold this year are still there. The expectation along Wall Street is still for the Federal Reserve to cut interest rates through next year. Concerns are growing about inflation remaining high. And the worrisome mountains of debt that the U.S. and other governments worldwide have amassed are only rising further.

But no investment’s price goes up forever, and criticism had been growing that gold’s price had gone too far, too fast after it shot up even more than the U.S. . Gold’s price is still up 56% for the year so far.

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

London’s FTSE 100 added 0.9% after a report on U.K. inflation raised hopes for another cut to interest rates next month. South Korea’s Kospi jumped 1.6% for another one of the world’s bigger gains. But indexes fell 0.9% in Hong Kong and 0.6% in Paris.

In the bond market, the yield on the 10-year Treasury eased to 3.95% from 3.98% late Tuesday.

U.Va. reaches agreement with DOJ

SUMMARY:

  • U.S. says U.Va. will deliver quarterly updates on anti- reforms through 2028, in response to what Justice called “unlawful racial discrimination”
  • Justice appears to have dropped accusations of antisemitism at U.Va.
  • No monetary penalty included in agreement

The U.S. Department of Justice announced Wednesday that it has reached an agreement with the regarding what it called “unlawful racial discrimination” in hiring, admissions and programming — a deal that does not include a monetary penalty but does require U.Va.’s president to provide quarterly reports to the federal government through 2028.

Assistant Attorney General Harmeet K. Dhillon, a U.Va. Law alumna who leads the department’s civil rights division, said in a statement that U.Va. will provide “relevant information and data” to the Department of Justice quarterly through 2028.

“The president of U.Va. will personally certify each quarter that U.Va. is in compliance with the agreement,” the statement says. “The department will pause its pending investigations into the university’s admissions policies and other civil rights concerns. The United States shall treat U.Va. as eligible for future grants and awards. If U.Va. completes its planned reforms prohibiting DEI at the university, the department will close its investigations against U.Va.”

The announcement comes days after U.Va.’s interim president, Paul Mahoney, announced that the university would not sign a compact with the U.S. Department of Education promoted by President to provide favorable treatment in federal funding in exchange for the school agreeing to a set of his administration’s priorities. U.Va. and eight other elite universities were offered the deal, but so far no universities have agreed to the compact.

Critics, including U.Va. faculty members, have said signing the compact would violate academic freedom.

According to U.Va. spokespeople, Mahoney sent a statement to the university community Wednesday after signing an agreement with the Department of Justice that does not include a monetary penalty and no external monitoring, as reported this week by The New York Times.

The text of the four-page agreement was posted on U.Va.’s website. It calls for the following measures:

  • U.Va.’s president will send certified quarterly reports to Dhillon through Dec. 31, 2028;
  • The agreement is not an admission of guilt; U.Va. “expressly denies liability with respect to the subject matter of the investigation”;
  • The May 2 and June 17 investigations into alleged antisemitism and racial discrimination were suspended as of June 26, the day before former President Jim Ryan announced his resignation;
  •  If the DOJ determines that U.Va. has made “insufficient progress” at any time toward “compliance with the civil rights laws,” the department will notify the university of a 15-day deadline to “make appropriate progress”;
  • After the 15 days are up, the Justice Department “may terminate this agreement and may pursue enforcement actions, monetary fines, or grant or funding terminations as appropriate”
  • The federal government can bring new reviews or investigations into civil rights law violations under the agreement.

“We intend to continue our thorough review of our practices and policies to ensure that we are complying with all federal laws,” Mahoney wrote in his statement Wednesday. “We will also redouble our commitment to the principles of academic freedom, ideological diversity, free expression, and the unyielding pursuit of ‘truth, wherever it may lead,’ as Thomas Jefferson put it. Through this process, we will do everything we can to assure our community, our partners in state and federal government, and the public that we are worthy of the trust they place in us and the resources they provide us to advance our education, research, and patient care mission.”

Dhillon’s statement Wednesday added that the state’s flagship university has made “progress” in “combating antisemitism and racial bias, and other American universities should be on alert that the Justice Department will ensure that our federal civil rights laws are enforced for every American, without exception.”

“This agreement allows U.Va. to move forward together, upholding the university’s principles and independence while maintaining the essential research partnership with the federal government,” U.Va. Rector Rachel Sheridan said in a statement. “This has been a challenging time for many institutions in , including U.Va. The agreement results from steadfast adherence to the same values that have guided generations of U.Va.’s leaders and that we have honored as stewards of that legacy.”

A conclusion — for now

The agreement appears to conclude an investigation that led to Ryan’s resignation in June, which he said was due to pressure from the .

Ryan, who left U.Va.’s presidency in July but is expected to return as a U.Va. School of Law professor after a sabbatical, wrote in an email that he was resigning to protect federal research funding, “hundreds” of university-based jobs and “hundreds of students who could lose financial aid or have their visas withheld.”

Since Trump took office in January, he has threatened to hold back federal funding of private and public universities, which are dependent on public funds for medical and other scientific research, and the Justice and Education departments have launched numerous investigations into universities, claiming that their diversity, equity and inclusion policies have led to discrimination against white, male students and job candidates.

Both federal departments also have wielded accusations that universities have promoted antisemitism and failed to protect Jewish students and staff members amid widespread pro-Palestine protests.

In addition to the DOJ’s investigation into U.Va., George Mason University in has been under significant scrutiny since July, with four DOE and DOJ probes launched that month. Faculty members and others at Mason have said that the Trump administration has tried to drive out President Gregory Washington.

At both universities, faculty groups have criticized both the Trump administration and their own boards of visitors, both of which are made up entirely of appointees by Gov. Glenn Youngkin.

Speaking Tuesday evening, U.Va. associate professor of research, evaluation and policy Walt Heinecke, who previously was president of U.Va.’s chapter of the American Association of University Professors, said that he and others at the university were concerned about the voluntary resolution.

“If this sort of voluntary resolution agreement leads to the same outcomes as the compact would have, there’s going to be a problem,” Heinecke said.

He also said that the board of visitors has “cut out” faculty members in the hiring process for both the next permanent president and its provost, the university’s top academic leader. Former provost Ian Baucom left the university earlier in the year to become president of Middlebury College.

“All these attacks on the University of Virginia, it’s just bad for business and innovation,” Heinecke added. “It’s bad for business, it’s bad for the economy, and it’s got to stop.”