Bloomberg - Evening Briefing - UPS strike averted

Bloomberg Evening Briefing

The Teamsters union announced it secured higher pay and a number of key concessions in a five-year contract with United Parcel Service that staves off a strike that would have reverberated across the US and beyond. The courier agreed to eliminate a class of drivers who earned less, put air conditioning in new vehicles and allow an additional paid holiday, the union says. In total, the Teamsters estimate the contract includes $30 billion of new money over its five-year span. UPS Chief Executive Officer Carol Tomé says the pact provides her company with “the flexibility we need to stay competitive.” But the provisional deal, which needs to be ratified by the union’s 340,000 members, is arguably a testament to the newfound leverage of organized labor at a time when wage growth is outpacing inflation. Teamsters President Sean O’Brien hailed the deal, calling it the best ever wrung from UPS. The labor leader has sought to prove his negotiating skills ahead of talks with other corporate behemoths—including Amazon.  

Here are today’s top stories

The US Federal Reserve is at a pivotal moment in its fight against inflation. After more than a year of solid agreement that higher interest rates were needed, differences among policymakers have started to deepen as they weigh when to stop hiking and how long to keep rates elevated. With a potential final rate hike in the offing, here’s a breakdown on where each of them stand.

The spring banking bloodbath may be a fading memory, but the fallout for regional lenders continues. PacWest Bancorp is being bought by smaller rival Banc of California, with Warburg Pincus and Centerbridge Partners investing $400 million as part of the deal. The merger is aimed at shoring up confidence after bank runs destroyed several of their brethren. The combined lender will have about $36 billion of assets, less than what PacWest alone had at the end of March. The firms will carry the Banc of California name.

Photographer: AaronP/Bauer-Griffin/GC Images

Google parent Alphabet reported second-quarter revenue that exceeded analysts’ expectations, boosted by advertising on the company’s flagship search business, which is withstanding new competition from artificial intelligence chatbots. Google’s search has weathered an ad slowdown that affected social media companies, such as Meta Platforms and Snap, more severely in recent quarters. The company’s search product also continues to dominate despite new competitive threats from Microsoft (which had some bad news on Tuesday) and OpenAI.

Despite its starring role in accelerating catastrophic global warming, fossil fuels are popular again among Wall Street’s biggest names. One of them is Warren Buffett. His multibillion-dollar purchases of oil and gas investments early in the pandemic paid off when the sector cranked out record earnings in 2022 (thanks largely to Vladimir Putin’s war on Ukraine). Now, instead of selling out for a huge profit this year, Buffett wants more. Berkshire Hathaway is using this year’s dip in commodity prices to load up on some of Buffett’s favorite oil and gas investments.

Heat searing enough to knock out mobile phones. Wildfire smoke that turns the skies an apocalyptic orange. Flash floods submerging towns in Vermont. This grim procession of recent disasters is being driven in part by the climate crisis. But there’s one particular facet of global warming that’s providing potent fuel to make extreme weather even more intense: record-hot oceans. Global ocean surface temperatures in June were the highest in 174 years of data, with the emergence of the El Niño weather pattern piling onto the long-term trend.  

Bleached coral on the Great Barrier Reef caused by heat stress from warmer water temperatures. Hotter oceans are fueling the growing number of weather-related disasters as well. Photographer: Brett Monroe Garner/Moment/Getty Images

When China’s Vital Materials Co. bought up a $600 million stockpile of obscure minerals in early 2020, it barely raised an eyebrow outside the niche world of minor metals. Spin forward a few years, and the influence of a company few even in the industry recognize illustrates the scale of the challenge to loosen China’s grip on key raw materials.

China removed Qin Gang as foreign minister just seven months into the job, marking the shortest-ever tenure for the role after he mysteriously disappeared from public view in June. While Qin’s unseating ends speculation over his official status, it does little to answer questions over the reason for the absence of an official considered one of Xi Jinping’s handpicked ministers.

Qin Gang Photographer: Pool/Getty Images AsiaPac

What you’ll need to know tomorrow

American Gun Culture Is Going Global

Now that there are more guns than people in America, gunmakers have set their sights on international markets. And thanks to eager buyers abroad and regulatory changes at home, business is booming. But with that flood of firearms comes the potential for the kind of mass gun violence for which the US is notorious. In this Bloomberg Originals video, we explore the way in which American gunmakers are increasingly profiting abroad, and the  consequences that have followed. Read the related story here.

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