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  • U.S. military says it’s launching new strikes on Iran as clashes escalate over shipping routes

    U.S. military says it’s launching new strikes on Iran as clashes escalate over shipping routes

    CAIRO — The U.S. military announced Thursday that it is conducting the 13th night of strikes against Iran as clashes escalate over shipping routes. Earlier Yemen’s Iran-backed Houthi rebels said they attacked two Saudi oil tankers in the Red Sea, potentially widening the Iran war as international oil topped $100 a barrel.

    U.S. Central Command said the latest attacks are designed to “further degrade Iran’s ability to threaten civilian mariners and commercial vessels transiting regional waters” as the Americans push to regain control over the Strait of Hormuz and restore the flow of international shipping.

    A short time later, Iranian state media reported explosions along the strait in Bandar Abbas and Qeshm, as well as to the northwest near Andimeshk and Omidiyeh.

    Meanwhile, the Houthis threatened to shut down another key trade route, with the world economy already reeling from Iran’s closure of the Strait of Hormuz. The threat came as Iran and the U.S. have stepped up attacks as they vie for control of the strait, through which a fifth of the world’s oil and gas transited in peacetime, setting off a scramble for alternative routes.

    President Donald Trump threatened “major military punishment” against the Houthis if their attacks on ships continue.

    “If they do this again, the U.S. will hold Iran responsible, in that the Houthis are a Surrogate and/or Proxy of Iran, and major military punishment will be inflicted upon Iran and, of course, the Houthis, themselves,” Trump wrote on social media.

    As the rhetoric escalated, so did the economic fallout. The price of Brent crude oil, the international standard, spiked more than 6% Thursday, to about $100 a barrel. That is the highest level since May, before the two sides reached a preliminary peace agreement last month that has since collapsed.

    Prime Minister Ali al-Zaidi of Iraq, which has close ties to both the U.S. and Iran, was in Tehran on Thursday to call for peace and dialogue, and he promised not to allow Iraqi territory to be used for attacks on Iran, his office said. Al-Zaidi met with Trump earlier this month in Washington.

    U.N. Secretary-General António Guterres warned Thursday that the region is being pulled “into an ever-widening circle of confrontation” with one crisis feeding another and every escalation triggering the next.

    “Diplomacy is the only way forward,” Guterres told the U.N. Security Council. He called for Pakistan’s efforts to mediate an end to the war to be strengthened.

    Houthi attacks are a ‘double whammy’ on oil shipments

    The Houthis’ SABA news agency said the rebels had struck two tankers, the Encelia and the Layla, in the Red Sea, causing fires on both. There were no reports of casualties.

    It was the first reported Houthi attack on a vessel since they announced a blockade of Saudi-linked shipping through the Bab el-Mandeb Strait earlier this week in retaliation for the kingdom’s blockade on Yemen and a recent attack on the international airport in Yemen’s rebel-held capital, Sanaa.

    Bab el-Mandeb, at the southern tip of the Arabian Peninsula, is a vital shipping chokepoint connecting the Red Sea to the Gulf of Aden. Around 12% of the world’s trade, including a fourth of global container traffic, passes through there, moving between Europe and Asia via Egypt’s Suez Canal.

    The state-run Saudi Press Agency reported an attack set the Encelia ablaze overnight in the Red Sea. It did not mention the Layla.

    The United Kingdom Maritime Trade Operations Center said it received a report of a tanker being struck by “an unknown projectile” 80 miles southwest of Al Shuqaiq, Saudi Arabia, in the Red Sea.

    The Houthi attacks put at risk oil shipments from Saudi Arabia’s Yanbu port on the Red Sea and present a “double whammy” on top of the disruption in the Strait of Hormuz, said maritime data and analysis firm Lloyd’s List Intelligence.

    Saudi Arabia has diverted millions of barrels a day of oil exports to Yanbu via an overland pipeline as the war has bottled up the Persian Gulf.

    The Houthi threat “raises questions on the viability of this route,” Lloyd’s said in slides accompanying an online webinar Thursday.

    The rebels say they are blockading Saudi Arabia, but during their announced blockade of Israel at the height of the war in Gaza, they targeted many vessels with little or no connection to that conflict, disrupting global trade.

    Both sides dig in over Strait of Hormuz

    Iran says it has the right to manage traffic and potentially charge fees in the Strait of Hormuz, which was open to all toll-free before the war. It has attacked ships using a route through the strait that is overseen by U.S. forces and intended to be outside Tehran’s control.

    Trump said on social media Thursday that sanctioned Iranian funds in the possession of the U.S. will cover the expense of fixing boats damaged in the war.

    “Please let this statement serve to represent, until further notice, that from this point forth, any and all damages done to Ships, Cargo, or anything related thereto, will be paid for by Iranian Money that the United States has in its possession, and controls,” Trump said.

    It was unclear what legal mechanisms Trump would use to access and spend the funds, but he said that doing so would be “the fair and equitable thing to do.”

    In response to Iran’s attacks, the U.S. began the widening campaign of strikes across Iran and restored a naval blockade of Iran’s ports. U.S. Central Command said it has redirected about a dozen commercial vessels and disabled one since the blockade resumed.

    The war of words has also escalated. Iranian Foreign Minister Abbas Araghchi said Tehran would adopt an “eye for an eye” policy on U.S. strikes against its infrastructure. U.S. Secretary of State Marco Rubio retorted that Trump’s policy is “a head for an eye.”

    “The price will continue to get higher every single night until they come to their senses,” Rubio told reporters while traveling in the Philippines for a regional summit.

    Iran’s health ministry said Thursday that 55 people have been killed and 629 have been wounded since renewed U.S. airstrikes began on June 27.

    Iran has responded to U.S. attacks by targeting energy infrastructure and desalination plants providing drinking water in parched neighboring Gulf countries.

    Polls have shown the war is unpopular among Americans, a fact reflected in the narrow passage Thursday of a resolution in the U.S. House to halt the war. Though a handful of Republicans crossed party lines to support the measure, the vote remained largely symbolic.

  • Brent oil tops $100 per barrel, as tumbles for Tesla and Alphabet yank Wall Street lower

    NEW YORK — Brent oil shot to its highest price since May after increased fighting in the Middle East on Thursday threatened to slow the global flow of crude. At the same time, sharp drops for two of Wall Street’s most influential companies, Alphabet and Tesla, yanked the U.S. stock market to its worst loss in a month.

    The S&P 500 fell 1.2% and is on track for its first back-to-back weekly loss since March. The Dow Jones Industrial Average dropped 506 points, or 1%, and the Nasdaq composite sank 2.2%.

    Stocks fell under the pressure of rising oil prices, which raise costs for businesses and erode their customers’ ability to spend. The price for a barrel of Brent crude oil, the international standard, jumped 7% to settle at $100.69.

    It touched $102 during the day, the highest price since May for the most actively traded Brent contract in the market. The cause: attacks on two Saudi oil tankers in the Red Sea. That threatens another avenue that oil companies use to move their crude from the Middle East to customers worldwide, along with the Strait of Hormuz.

    Underscoring the importance of the sea route for the economy, President Donald Trump threatened “major military punishment” against the Houthi rebels in Yemen, who are backed by Iran, if they keep attacking ships.

    It was just a few weeks ago that Brent had dropped below $72 per barrel, roughly back to where it was before the United States and Israel attacked Iran to begin their war, on hopes that a wind-down in the war would fully reopen the Strait of Hormuz.

    The jumps in oil prices will worsen inflation, just when it had begun to decelerate by more than economists expected. That in turn could push the Federal Reserve and other central banks to raise interest rates, which would slow economies and undercut prices for stocks and other investments.

    The European Central Bank held its main interest rates steady at its meeting Thursday. But traders are betting on a 36% chance the Fed will hike the federal funds rate at its meeting next week. That’s up from the nearly 12% probability seen a week ago, according to data from CME Group.

    An increase by the Fed would be the first since 2023.

    Higher oil prices pushed the yield of the 10-year Treasury up to 4.69% from 4.67% late Wednesday and from just 3.97% before the war with Iran began. That’s a significant increase, and it’s already brought long-term U.S. mortgage rates to their highest levels in nearly a year.

    Gasoline prices tend to follow oil prices higher, and a gallon of regular costs an average of $4.09 across the United States, according to AAA. That’s still below highs of roughly $4.56 in May, but it was at just $3.93 a month ago.

    On Wall Street, stocks of companies with big fuel bills fell to sharp losses on worries about higher expenses.

    American Airlines fell 8.4% even though it reported a much bigger profit for the spring than analysts expected, something that usually sends a stock’s price higher. It raised airfares, which helped it offset its higher fuel prices, during the latest quarter.

    Southwest Airlines lost 6.2%, even though it also reported better profit and revenue than analysts expected.

    One of the heaviest weights on the U.S. stock market was Tesla, which tumbled 14.5% after Elon Musk’s electric-vehicle company reported a weaker profit for the latest quarter than analysts expected. Because it’s one of the largest stocks in the S&P 500 by market value, its stock has more influence on the index than nearly every other.

    One of the few that’s larger is Alphabet, and its stock fell 7.1% even though the parent company of Google delivered stronger profit and revenue than analysts expected.

    Investors focused instead on how much Alphabet is planning to spend on artificial-intelligence investments. Alphabet raised its forecast for capital spending over the full year after its investments last quarter doubled to nearly $45 billion from a year earlier.

    CEO Sundar Pichai said AI helped its cloud revenue growth accelerate to 82% last quarter, but unease nevertheless remains about whether all the money going into AI will pay off in terms of productivity and profits.

    Such worries have been shaking the AI industry broadly in recent weeks, leading to big swings for the overall stock market.

    All told, the S&P 500 fell 90.66 points to 7,408.30. The Dow Jones Industrial Average dropped 506.93 to 51,711.65, and the Nasdaq composite sank 553.21 to 25,137.69.

    In stock markets abroad, indexes fell sharply in Europe after oil prices jumped. France’s CAC 40 dropped 1.6% for one of the larger losses.

    Indexes in Asia were stronger earlier in the day, and South Korea’s Kospi jumped 4.4%.

    AP Business Writers Matt Ott and Elaine Kurtenbach contributed to this report.

  • Government withdraws subpoenas of 3 reporters for the New York Times after admitting legal errors

    Government withdraws subpoenas of 3 reporters for the New York Times after admitting legal errors

    NEW YORK — Criticized by a federal judge for sloppy legal work, the government on Thursday grudgingly withdrew subpoenas that would have compelled three New York Times reporters to testify about their sources for articles about President Donald Trump’s Qatari-gifted Air Force One jet.

    The withdrawals in U.S. District Court followed a remarkable back and forth between a visibly irritated Judge Arun Subramanian and government lawyers. They come at a time when the Trump administration is vigorously going after news organizations whose reporting and coverage it doesn’t like — and also trying to crack down on leaks inside the government.

    The government’s retreat in the face of vigorous legal opposition and a stern reprimand from a judge marked the latest instance of the Justice Department pulling back on its aggressive efforts to compel journalists to identify their sources before a grand jury. The administration recently withdrew similar subpoenas that sought to compel testimony in Virginia from journalists for the Washington Post and the Wall Street Journal related to separate national security coverage.

    Subramanian said he otherwise would have granted the newspaper’s request to reject the subpoenas because laws and regulations pertaining to subpoenas served on journalists maintain that they should be issued as a last resort in an investigation.

    “Subpoenas are the last step, not the first step, but the last step,” the judge said, citing rules set to protect against violations of the First Amendment. He said the government’s actions had turned the law and the regulations “on its head.”

    “When you see something like this, if this were a civil proceeding, what I would normally do is ask the parties to show causes why sanctions should not be issued,” the judge said, referencing punishment for lawyers for egregious actions.

    After the hearing, the Justice Department lashed out at the judge in a statement, saying he “threatened our attorneys with sanctions unless subpoenas were withdrawn, and blocked us from presenting the meticulous process of this investigation.”

    “The grand jury has a right to hear testimony from all material witnesses in a federal criminal investigation. This judge’s conduct overrides clear longstanding principles and common sense — blocking the grand jury from receiving core evidence in a national security investigation,” the statement said.

    “Make no mistake,” it added, “this investigation remains ongoing, and we will pursue justice against those threatening national security by leaking classified information, a serious federal crime.”

    Government attorneys upbraided by judge

    Subramanian noted that with protections for journalists at stake, the government was required to ensure it could not obtain what it needed from any other sources before issuing subpoenas to journalists.

    A Justice Department lawyer, Sean Buckley, cast the government’s missteps as inadvertent errors and said “no one was trying to pull a fast one.” Buckley apologized for other subpoenas that sought records for phone numbers belonging to one reporter’s mother and two of the journalists’ spouses.

    “That was an error, judge, which we own,” Buckley said. “It was a consequence of trying to move quickly.”

    “These things are starting to pile up,” Subramanian said, becoming increasingly testy.

    The hearing was held publicly despite efforts by the Trump administration to keep secret the litigation spawned by subpoenas it served on the Times’ journalists to try to get them to divulge their sources.

    The newspaper’s lawyers had challenged the validity of the grand jury subpoenas, along with subpoenas issued for phone records of several Times journalists and some of their relatives. Senior Times officials, including the paper’s managing editor and general counsel, sat in the gallery watching during Thursday’s proceedings.

    The request for phone records raised questions about the extent of the investigation being carried out by the Justice Department.

    David McCraw, the Times’ chief newsroom lawyer, said after the hearing in a statement that it “was an important affirmation of our country’s commitment to a free press.”

    “We are pleased that the government finally conceded that the subpoenas violated the law, but they should never have been issued in the first place,” he said. “We will not be deterred in the face of tactics like these.”

    Court action comes after reporting on new Air Force One jet

    The new jet in question, a present from Qatar that Trump’s administration spent $400 million to retrofit and upgrade, recently entered service. But Trump used an older model Air Force One jet to leave a NATO summit in Turkey earlier this month.

    The Times, citing anonymous sources, reported that the switch had come at the urging of the Secret Service and that the newer plane lacked some of the advanced security features of the older Air Force One aircraft, including antimissile capabilities. On social media, Trump rejected claims of security concerns.

    The Times wrote in a letter to the judge several days ago that two subpoenas seek records beginning on Jan. 1, long before the newspaper published articles on July 8 and July 9 that became the basis for the grand jury subpoenas.

    It said that lengthy stretch of records sought would indicate that the purpose of the subpoenas might have been “to forage for information about the Journalists’ source relationships more broadly.”

    The Times argued for the phone records subpoenas to be disallowed on the grounds that the government had acted in “bad faith” and ignored its own protocols by not giving the journalists advance notice that records were being sought and by demanding the information “without first conducting any serious investigation.”

    The Justice Department has justified the grand jury subpoenas by saying that “reporters are not the targets, those leaking classified information are.”

    The Justice Department also said it had complied with its own regulations in issuing the subpoenas and had taken investigative steps before seeking them. It said it was authorized to delay disclosing the subpoenas but decided to alert the journalists’ lawyers so they could challenge them.

    In fighting the subpoenas, the Times’ lawyers highlighted how the government’s carelessness could have exposed sensitive information that had nothing to do with the journalists. The mother whose phone records were mistakenly sought is a mental health professional with confidential client relationships and one of the two spouses is the general counsel of a law firm, the lawyers said.

    At Thursday’s hearing, a final rebuke from the judge to the government came when he asked its lawyers to assure him that it won’t repeat a scenario that left one journalist being served a subpoena by an FBI agent while he was home watching the family-friendly movie The Sheep Detectives, about sheep on a quest to solve the murder of their shepherd.

    Said the judge, to loud courtroom laughter: “I can’t think of anything more inconsistent with ‘Sheep Detective’ than an FBI agent showing up at your door.”

  • Trump imposes double-digit tariffs on dozens of countries as his 10% levies are set to expire Friday

    Trump imposes double-digit tariffs on dozens of countries as his 10% levies are set to expire Friday

    WASHINGTON — President Donald Trump is going ahead with new double-digit tariffs on dozens of U.S. trading partners just as the clock runs out Friday on stopgap levies he imposed after a stinging defeat at the Supreme Court.

    The United States will slap taxes of 10% to 12.5% on imports from 60 countries accounting for 99% of U.S. imports, charging that they have inadequately enforced bans on goods produced by forced labor.

    “The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same,” said U.S. Trade Representative Jamieson Greer. “Today’s action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere.

    The new tariffs will take effect just as temporary 10% worldwide tariffs expire at 12:01 a.m. Friday. Trump had turned to those temporary levies after the Supreme Court struck down his biggest and boldest tariffs in February.

    Now he’s tapping more durable tariffs under Section 301 of the Trade Act of 1974, which permits the president to impose import taxes and other sanctions against countries found to engage in “unjustifiable,” “unreasonable,” or “discriminatory” trade practices. Trump used Section 301 to impose big tariffs on China in his first term, and they survived court challenges.

    More Section 301 tariffs are likely coming: The U.S. Trade Representative’s office has launched a probe into whether 16 countries — accounting for 70% of U.S. imports — have overproduced goods, pushing down prices and putting U.S. companies at a disadvantage in global markets. The administration has yet to complete that investigation.

    Trump, who argues that high tariffs will revive American manufacturing, last year overturned decades of U.S. policy that favored lower tariffs and ever-freer trade. Invoking the 1977 International Emergency Economic Powers Act (IEEPA), he imposed double-digit tariffs on imports from almost every country on Earth, saying America’s longstanding trade deficit amounted to a national emergency.

    But the Supreme Court ruled that IEEPA did not authorize tariffs. The decision forced the administration to pay refunds to importers that had paid the tariffs.

    In response, Trump announced 10% worldwide tariffs under Section 122 of the Trade Act of 1974. But he can only use Section 122 levies for 150 days; time runs out on them Friday.

    The administration initially proposed the forced labor tariffs last month. Since then, some countries have tightened forced labor enforcement and qualified for lower tariffs, said a senior administration official who spoke under condition of anonymity. For example, the official said, the tariff on imports from India initially was set at 12.5% but now will be 10%.

    Some products — including oil and gas and fertilizer — are exempted from the new tariffs announced Thursday. Also being spared are products that qualify for duty-free status under the US-Mexico-Canada Agreement, the North American trade pact Trump negotiated in his first term.

    Tariffs are paid by companies in the United States that import foreign products. The importers usually try to pass along the cost by charging consumers higher prices. Americans are already frustrated by the high cost of living. So the administration is taking a risk in rolling out new tariffs ahead of the Nov. 3 midterm elections.

    Human rights watchers say that it’s reasonable to be skeptical of the motivation behind the tariffs. But they say the levies could make an impact on the problem of forced labor.

    Forced labor is defined by the International Labor Organization Forced Labor Convention of 1930 as “all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself (or herself) voluntarily.”

    According to the latest statistics from the ILO, which is a U.N. agency focused on human and labor rights, about 27.6 million people were in forced labor worldwide on any given day in 2021.

    “We’ve gone on record for years now advocating for import bans, not as a magic bullet, it’s not a silver bullet, but as a potentially effective tool in combating forced labor across the globe,” said Martina Vandenberg, founder and president of The Human Trafficking Legal Center.

    “It’s possible to be extremely critical of tariffs, as we are, and to be very concerned about blanket tariffs used as bludgeons against countries,” she said. “And yet I think it’s undeniable that there is a significant response in terms of the adoption of import bans.”

    However Vandenberg and her organization urged in testimony that the tariffs be implemented in a phased approach to give countries time to implement a ban or a plan for enforcement.

    “Our concern is that the import bans will be thin slips of paper with no enforcement,” she said. “Countries need time to build import ban mechanisms that are meaningful and enforceable.”

    Kenya Davis, partner at Boies Schiller Flexner, said the Uyghur Forced Labor Prevention Act, a U.S. federal law passed in 2021 that prohibits the importation of goods made wholly or in part in China’s Xinjiang region or by designated entities, is the most significant legislation related to forced labor that the U.S. has passed before the tariffs.

    “The level of effectiveness is certainly up for debate, but it certainly has drawn attention to the issue of labor trafficking and forced labor,” she said. “And so, if nothing else, these import bans will serve that function of bringing greater awareness to forced labor.”

    But without a “comprehensive approach,” that provides transparency about what the investigations consisted of, and programs that provide countries aid in enforcing bans, “I’m very cautious in my enthusiasm about the [tariffs],” she said.

    Isabelle Glimcher, senior research scientist for global labor at the NYU Stern Center for Human Rights, said one flaw in the tariffs is that they focus on levying the tax on countries based on goods they import — not goods they make domestically.

    But she said the impending tariffs threat has spurred several countries — such as India — to amend their foreign trade policies to include a forced labor import ban. European Union forced labor regulations due to go into effect later next year are also contributing, she said.

    “Not all of these things are necessarily or wholly attributable to the Section 301 investigations, but does seem like countries are responding and starting to take all of this seriously,” she said.

  • Gas, groceries, and back-to-school items are where shoppers might see higher oil prices surface

    Already feeling pinched since the start of the Iran war, consumers are likely to feel more pain ahead as oil prices pushed past $100 a barrel Thursday amid renewed fighting and military strikes that have left global oil supplies stranded in the Middle East.

    The elevated price marked a turn from lower oil prices enjoyed briefly when hostilities between the U.S. and Iran waned in June. Brent crude, the international standard, last reached $100 a barrel in May.

    Companies that produce and sell fresh food, school supplies, and anything that gets shipped using fuel reported cost impacts from an earlier spike in energy prices after the U.S. and Israel attacked Iran. They’re likely to continue passing some of their increased expenses to consumers.

    “In general, once you have an increase in costs, businesses are fast in increasing the price,” said Miguel Gomez, director of Cornell University’s Food Industry Management Program. But, he noted, “it takes more time to lower prices when the costs go down.”

    Here’s how higher oil prices could further impact consumers’ wallets.

    Drivers are paying more for gasoline at the pump

    Volatility along the Strait of Hormuz and broader regional instability pushed up the price of crude oil, the main ingredient in gasoline, and could continue to make driving costlier during the second half of summer, according to motor club AAA.

    The average U.S. price for regular gasoline reached $4.09 a gallon Thursday, up 15 cents from a week ago, with drivers in most states now paying $4 or more, according to AAA.

    “Given the typical lag along the oil industry’s supply chain, prices at the pump are poised to keep rising at least into next week,” said Pavel Molchanov, investment strategy analyst at Raymond James. But he noted that futures prices for oil delivered later this year and next year are lower, suggesting prices could fall once military action ends.

    For the most part, higher gasoline prices haven’t stopped Americans from driving. Gasoline demand rose 1% to 8.9 million barrels per day last week, according to the U.S. Energy Information Administration.

    Pressure on gasoline prices could persist because fewer refineries are available to process crude than before the conflict. Refineries in the Middle East have been damaged, and Ukrainian attacks have damaged refineries in Russia.

    Shoppers are paying more for a bag of groceries

    Grocery prices generally rise with oil because farmers use diesel fuel to power equipment, while many food products are transported by trucks that require fuel.

    “Oil at $100 doesn’t make food prices jump right away, but it does put upward pressure across the food supply chains, especially for categories that depend heavily on trucking, cold storage, and packaging,” Gomez said. Fresh produce and dairy could feel a larger impact because they require refrigeration during delivery.

    Imported goods are also vulnerable to higher shipping costs, Gomez said. “Things like olive oil that we produce very little here and are coming from mostly from Europe are going to be up.”

    Grocery chain Albertsons on Thursday lowered its 2026 fiscal outlook, citing pressure on its core grocery business and a pullback in consumer spending.

    Every product that moves will have higher costs baked into the price

    Higher fuel costs for ships, trucks, and air carriers can trickle down to consumers and businesses that depend on shipping. UPS, FedEx, and other shipping services introduced fuel surcharges and other fees as fuel prices increased.

    According to an AFS Logistics and TD Cowen Freight Index released July 14, truckload pricing is at a four-year high because of rising fuel costs and capacity constraints.

    Andy Dyer, CEO of AFS Logistics, said diesel prices in the second quarter were about 51% higher than in January and February, while jet fuel prices rose 90% from a year earlier.

    “Beyond the direct impact of higher freight bills paid by shippers, these price movements also have second-order effects that squeeze rates higher,” he said. “Smaller truckload carriers working on tight margins may park trucks and wait for fuel prices to revert to more palatable levels before returning to operation.”

    Retailers are noticing consumers pulling back

    Rural lifestyle retailer Tractor Supply Co. reduced its annual sales outlook on Thursday, citing in part higher fuel prices during its spring selling season that weighed on customer spending.

    ”Our customers often drive longer distances to shop frequently in pickup trucks, many of which are diesel-powered, making them especially sensitive to higher fuel costs,” CEO Hal Lawton told analysts.

    Lawton said customers are still investing in their pets, animals, farms, and properties, but shopping has become “more deliberate.” Customers are consolidating trips, prioritizing needs-based purchases, and taking a more measured approach to discretionary spending.

    Back-to-school shoppers may face higher prices

    The Footwear Distributors and Retailers of America trade group warned in a report Wednesday that increasing freight and material costs, along with rising tariffs costs, are creating big challenges for the footwear industry as companies prepare for the back-to-school shopping season and the remainder of the year.

    Matt Priest, CEO and president of the trade group, said some of its members have cited 25% price increases for petroleum-based materials used in footwear manufacturing due to the Middle East conflict. Those costs could eventually translate into roughly a 5% increase in the cost of finished footwear products sold to consumers, Priest said in the report.

    Footwear companies have been front-loading inventory and accelerating imports before President Donald Trump imposes new tariffs on foreign products, putting additional pressure on shipping rates, he said.

    “Container rates are spiking right now,” Priest said.

    Higher jet fuel costs lead to costlier flights

    Since the war began, airlines have responded to the jump in fuel costs by raising fares and add-on fees, and trimming flights or routes that are no longer profitable at higher fuel prices. Those moves can help protect the airlines’ margins, but also leave travelers facing higher prices and fewer options, particularly in smaller or less competitive markets.

    In the latest sign that the conflict is driving up costs for the travel industry, American Airlines on Thursday reported a sharp decline in second-quarter net income despite record revenue and strong spring travel demand.

    American said higher fares helped offset nearly half of its higher fuel bill but not enough to prevent it from lowering its full-year outlook.

    Despite higher prices, jet fuel demand in the last four weeks increased 9% compared to the same time last year, according to EIA.

    Associated Press writers Rio Yamat in Las Vegas, Wyatte Grantham-Philips, and Dee-Ann Durbin in Detroit contributed to this report.

  • Trump expands a voluntary pledge to protect consumers from high utility bills from AI data centers

    Trump expands a voluntary pledge to protect consumers from high utility bills from AI data centers

    WASHINGTON — President Donald Trump on Thursday had governors and electricity companies join a voluntary pledge to shield U.S. consumers from higher utility bills from data centers — a sign of how the artificial intelligence build-out has become a lightning rod of controversy before the midterm elections.

    The president first announced the pledge with leading AI and tech companies in March, but that initial commitment has done little to comfort voters who are already grappling with affordability issues as they worry about competing for electricity, water, and land with tech companies controlled by billionaires. It’s unclear, with electricity demand already growing, whether consumers would see genuine savings.

    Trump is doubling down on the pledge at a time when the broader social contract is being rewritten by AI, a technology that is evolving so quickly in its capabilities that governments are struggling over how to provide oversight.

    The president, in remarks about the pledge at the Environmental Protection Agency, called on the gathered executives and governors to sell the public on data centers, stressing that the cities and towns that do have them will be “rich.”

    “You have to convince your community,” Trump said. “You can’t fight it. You have to go with it.”

    The president added: “If you don’t take all that money, somebody else is going to take it. You might as well do it yourselves.”

    Concerns about data centers cross party lines

    The president promised that electricity prices would drop because of the nonbinding pledge, saying there would be a surplus of power. It’s not clear that data centers generating their own electricity will be sufficient to overcome the rising demand for electricity, but that did not deter Trump from saying that utility bills — a major concern for voters — will be lower.

    “Electricity bills for American families will actually come down,” Trump said. “They’re going to have a lot of electricity left over, and they’ll put that into the grid.”

    The White House said Thursday the pledge has been signed by 23 governors and at least 187 companies, including 55 utilities and 27 data center developers. Signers include some of the nation’s biggest utilities such as NextEra Energy, Duke Energy, American Electric Power, Southern Co., and Pacific Gas & Electric.

    Data center developers that have signed the pledge include Equinix, Digital Realty, and Prologis.

    A slowdown in data center construction could derail what has been one of the dominant drivers of U.S. economic growth, in addition to possibly ceding the U.S. edge in cultivating the technology to China and create national security risks.

    But AI’s increasing ability to perform basic tasks — such as driving, analyzing spreadsheets, and writing software — also potentially threatens millions of jobs. That has created mounting public resistance as tech companies concentrate historic levels of wealth in the hands of a select group of tycoons.

    The increased electricity demand could cause monthly utility bills to rise by 15% to 40% by 2030, according to a recent analysis by ICF, a consulting and technology services company.

    Opposition to data centers has spiraled into a bipartisan issue. Voters are worried about the environmental impact, use of AI in schools, and the prospect of data centers making their communities more expensive and less livable. Data center companies say their facilities help to generate tax revenues for school districts and reduce property tax burdens for homeowners.

    The opposition has spread into the Republican stronghold of rural Texas and led to frustration with Gov. Greg Abbott, who is now among the 23 Republican governors who signed Trump’s nonbinding pledge.

    Gina Hinojosa, the Democratic nominee for Texas governor, has been using the issue to challenge Abbott before the November election.

    “They are owned by the richest men in the world,” she said of data centers. “We’re all footing the bill. There are no rules. It is the Wild West of data centers.”

    New York Gov. Kathy Hochul, a Democrat, signed an order to ban construction of large server warehouses in her state for a year. In May, Florida Gov. Ron DeSantis, a Republican, signed a law that he said would prevent utilities from passing along energy costs from data centers to residential and small-business customers.

    Already, dozens of state legislatures or utility commissions have moved to put in place requirements that data centers pay the cost of their electricity, including new power plants or transmission system upgrades. But it’s not

    Tech companies are pushing growth of data centers

    In California, however, the industry opposes legislation designed to protect consumers from electricity price increases attributable to data centers, said Matthew Freedman, a staff attorney for the Utility Reform Network.

    “It is disappointing, but perhaps not surprising, that the same tech companies signing the Ratepayer Protection Pledge are simultaneously opposing efforts at the state level to force them to deliver on their promises,” Freedman said.

    In an interview with The Associated Press last month, Nvidia CEO Jensen Huang, whose computer chips are enabling the AI revolution, said America’s weakness is a lack of power generation for further developing the technology.

    Google, Microsoft, Meta, Oracle, xAI, OpenAI, and Amazon are among the companies that have already committed to the Trump administration’s “Ratepayer Protection Pledge” that consumers will not shoulder the cost of the data center build-out.

    Despite the pledge, there are challenges on addressing issues with electricity prices.

    The White House has complained that PJM Interconnection, which oversees electric power in 13 states from Virginia to Illinois, can’t ensure adequate electricity supplies at reasonable prices in the AI-driven boom.

    White House spokeswoman Taylor Rogers said Thursday that PJM — the nation’s largest grid operator — has failed to implement a bipartisan statement of principles signed by the Trump administration and all 13 governors in the region.

    “The Trump administration strongly advises PJM and its member companies to proactively reform its stakeholder process, reform its board governance, and implement the Statement of Principles before it is too late,” Rogers said.

    There are efforts to formalize Trump’s pledge as law, with the House Energy and Commerce Committee approving a bipartisan bill. The bill would require data centers to bear the costs of grid upgrades.

  • As the president touts Trump Accounts, some families are still waiting for baby’s $1,000

    As the president touts Trump Accounts, some families are still waiting for baby’s $1,000

    WASHINGTON — At a rally Wednesday, President Donald Trump touted the $1,000 babies can receive when their parents open Trump Accounts in their names, seed money that Trump says will help give them “a really fair shot at the American dream.”

    “Think of that. The government is finally giving money back to our children,” Trump said to the crowd gathered at a Georgia high school

    Some parents who opened accounts earlier this month for their babies say they’re still waiting for their money. The accounts went live July 4, two days before Trump rang the opening bells for the New York Stock Exchange and the Nasdaq from the Oval Office.

    The tax-advantaged accounts can be opened for any child under the age of 18, and more than 7 million accounts are already active, Trump said Wednesday. Babies born between Jan. 1, 2025, and Dec. 31, 2028, get $1,000 in seed money from the U.S. Treasury. Most of those families receive their $1,000 in one or two days, the Treasury Department said.

    After the Trump Accounts are set up, parents, relatives, friends and employers can contribute to them. Some billionaires have also pledged philanthropic contributions to the accounts. The money is turned over to private firms that invest it in index funds, a type of mutual fund that tracks the performance of the stock market. The money can’t be accessed until the child turns 18, and only then for specific purposes, such as going to school, opening a business or buying a home.

    At the rally Wednesday, Rick Jackson, Georgia’s GOP nominee for governor, said he would push for state lawmakers to match the $1,000 in seed money from the federal government. Jackson, a wealthy businessman and CEO of a healthcare company, said he believes Georgia lawmakers will support that, but “if they don’t, I will personally donate it myself.”

    Boosters of the program say it’s a chance to give more Americans a stake in the stock market. They hope it will stem the rising popularity of democratic socialists, who seek to raise taxes on corporations and wealthy people to ease the cost of things like food and healthcare for low-income and middle-class Americans.

    Some parents were told it could take 4 weeks for the deposit

    For babies born since Trump took office last year, $1,000 from the U.S. Treasury is supposed to kick off the accounts. While some parents report receiving the money, others said in interviews and on social media they’re still waiting for their $1,000.

    Masaki and Kristina McLellan, new parents from Bergen County, N.J., said in an interview they were wary of signing up for the accounts because they worried it was a promotional stunt for the president. But the $1,000 incentive persuaded the couple, whose daughter Maya was born in late March, to start an account anyway.

    Masaki McLellan said he applied for the account July 6. At first, the application was rejected, but the account was activated after he called the Trump Account hotline. He was told he’d see the money in the account in 10 days. Now, he says, he’s been told it will take up to four weeks.

    Kristina McLellan said she was disappointed it was taking so long to fund her daughter’s account. But the infant has multiple other investments already compounding for her. Maya’s parents have already started a 529 college savings plan and a custodial brokerage account for her. The Trump Account is the third investment account in the little girl’s name.

    “We definitely want to give her options for her future and make sure she can choose what she wants to do,” said McLellan, a studio director for a local news station, who returns from maternity leave next week.

    The Treasury Department emphasized the McLellans’ case is unusual and said only a sliver of those who apply need customer support.

    Treasury says most parents wait only 1 or 2 days

    The Treasury Department said that the lag between opening an account and receiving the seed funding constitutes “standard processing time, like receiving a tax refund,” and that the overwhelming majority of parents are waiting only one to two days. But the department likes to give parents a conservative estimate for how long it might take for the money to be transferred, such as the estimate of up to four weeks given to the McLellans.

    “Trump Accounts level the playing field by allowing every parent to invest in their children’s future, not just wealthy families with trust funds,” the department said.

    The government also unveiled an initiative last month that permits child welfare agencies to open accounts on behalf of foster youth.

    “With roughly 1 million sign-ups per month before launch, Trump Accounts have become the most popular and successful government-backed savings product in U.S. history,” the Treasury Department said.

    On Wednesday, Trump called the accounts “the most consequential” part of his signature tax and spending cuts bill, also known as the One Big Beautiful Bill.

    Trump faces pressure over his handling of the economy

    Trump’s stop in Georgia comes as he and fellow Republicans face pressure in the midterm elections for their handling of the economy. Only 33% of U.S. adults approve of Trump’s economic leadership, among the lower ratings of his second term, according to a June survey by the Associated Press-NORC Center for Public Affairs Research. Trump pledged to lower costs, but his tariffs and the war in Iran have instead helped to increase prices.

    Trump Accounts are similar to baby bonds, championed by Democratic-led cities and states meant to shrink the wealth gap between low- and high-income children. But unlike most baby bonds, which generally target kids from disadvantaged backgrounds, Trump Accounts are available to families of all incomes.

    The program has faced criticism from those who say it does nothing to help families in a child’s first years of life, when children are most likely to experience poverty, homelessness, and hunger. And the Republican bill that created the program also slashed funding for programs that are disproportionately used by children, including Medicaid and the Supplemental Nutrition Assistance Program.

  • OpenAI blamed a hacking event on its AI models going rogue. Here are some things to know

    ChatGPT maker OpenAI says it is still investigating the “unprecedented cyber incident” that led its artificial intelligence systems to break out of a testing environment and hack into another AI company.

    OpenAI said Tuesday two of its most capable AI models were responsible for the cyberattack targeting AI startup Hugging Face. The incident is stirring debates over the need for stronger AI guardrails and the extent to which AI agents are capable of acting on their own.

    Hugging Face said last week that it had detected an intrusion into its data processing systems that it suspected was caused by an AI agent autonomously acting on its own. But the New York-based startup said it wasn’t until this week that it learned OpenAI was responsible, and it worked with the larger company to contain what Hugging Face CEO Clément Delangue called “an attack unlike anything we’ve seen before.”

    San Francisco-based OpenAI said its AI used stolen credentials and discovered a previously unknown vulnerability to access Hugging Face’s servers. It was working with reduced guardrails because it was supposed to be in an isolated testing environment known as a sandbox.

    But it went to “extreme lengths to achieve a rather narrow testing goal,” finding ways to connect to the internet without human direction and “gain access to secret information that it could use to cheat the evaluation,” the company said.

    Some experts say OpenAI is wrongly blaming the technology

    University of Amsterdam social scientist Hannes Cools said the framing of the cyberattack as an AI agent acting on its own is an unnecessary anthropomorphization that takes some of the heat off the company.

    “It is a human decision to switch off specific safeguards,” said Cools. “It’s not an AI that goes rogue in that sense. It followed specific instructions based on the prompt that was given to that AI system.”

    Even so, other experts say the cleverness with which the AI models were able to cause problems without human direction speaks to the dangers. OpenAI said the intrusion was caused by a combination of its AI models, including its newly released GPT‑5.6 Sol and an “even more capable” model that is still being tested internally.

    “It went off and did this hack all by itself, as far as we can tell,” said Colin Shea-Blymyer, a cybersecurity research fellow at Georgetown University’s Center for Security and Emerging Technology. “This is the highest level of autonomy that we’ve seen in the use of a large language model for cyber operations.”

    How an AI agent found the keys to the ‘teacher’s house’

    One of the most surprising innovations in what Shea-Blymyer describes as an “almost entirely self-directed” attack was the AI agent’s apparently independent decision to target Hugging Face, a well-known AI development hub and marketplace.

    He said OpenAI’s internal environment for testing AI capabilities and risks worked a “little bit like putting a student in a room and telling them, ‘Do bad things. Your job now is to evaluate how bad of a person you can be.’ And then you lock the room and you leave for the weekend and you come back and they’ve left the room.”

    But then “the cybersecurity agent that was being tested broke out of its sandbox, had access to the internet and sort of thought to itself, ‘Who would have the answers to the test that I’m working on?’”

    The answer was Hugging Face, a repository for AI testing data.

    “And so the agent thought, ‘Well, we’ll go to the teacher’s house,’ so to speak. And from there it devised a plan to break in and steal the answer key,” he said.

    The hack highlights the debate on open-source vs. closed AI

    The hack comes at a time of intense debate about the benefits and risks of open-source AI models, particularly those built in China that are cheaper and almost as good as those that U.S.-based “frontier AI” companies like Anthropic, Google, and OpenAI are building.

    Despite its name, OpenAI’s models are closed. Hugging Face, by contrast, is a big promoter of open-source technology, in which developers make key components accessible for anyone to examine, modify, and build upon.

    Hugging Face co-founder and chief science officer Thomas Wolf said the attack has reinforced his belief in the importance of wide access to open-source models for cybersecurity defense. Hugging Face used a Chinese model to combat the intrusion.

    “When a frontier model is attacking you and moving laterally inside your infrastructure, defenders need wide access to near-frontier tools within hours or even minutes, rather than being pointed toward a closed-door” platform, Wolf wrote in a social media post.

  • The men behind Trump’s $3.47 gas: An NFL coach, a GOP fundraiser and two New Jersey brothers

    The men behind Trump’s $3.47 gas: An NFL coach, a GOP fundraiser and two New Jersey brothers

    WASHINGTON — President Donald Trump and his White House have enthusiastically promoted the Freedom Fuel Network, a chain of star-spangled convenience stores selling gas at $3.47 per gallon in honor of the 47th president.

    Untangling exactly who is behind the Philadelphia-area venture has proven difficult. Records indicate the chain, which was launched last month, is run by a disparate collection of businessmen that includes an NFL kicking coach, a GOP fundraiser and a New Jersey entrepreneur who this year was ordered, along with his brother, to pay civil damages for unlawfully taking more than 200,000 gallons of fuel.

    At Trump-promoted Freedom Fuel gas stations, prices are up and questions linger

    How the stations got Trump’s attention remains a mystery, and the four businessmen declined to — or could not be reached for — comment.

    What is clear: Trump loved the idea of cheaper gas. The president celebrated the network’s gas prices just before the busy July 4th travel period as consumers were grappling with higher oil prices sparked by the war with Iran.

    “I am pleased to announce that a VERY smart Retailer, located throughout the Northeast, is stepping up,” Trump wrote about the company on his Truth Social platform on July 1. “America has never been stronger than it is now, and Gas Prices will soon be back to the Record Low Prices Americans enjoyed at the pump before our very successful ‘excursion’ in Iran.”

    The White House followed up with a post on X a few days later that heralded the opening of the first Freedom Fuel station and produced a video showing patrons waving wads of cash and thanking Trump for reducing the prices outside a store festooned with American flags and a golden eagle logo.

    That station, located in Dresher, Pennsylvania, is owned by a subsidiary of Blue Owl Capital, an investment firm, records show. Trump has owned up to $25 million worth of Blue Owl stock, though his most recent financial disclosure says he has sold almost all of that stake.

    The White House denied Trump had any personal connection to the venture, but declined to say how the project was developed. It acknowledged having discussions with individuals who set up the network of gas stations.

    “The Administration is not involved in the company, nor has the Administration given the company any funding. There is no other entity or person subsidizing the lower gasoline costs,” the White House wrote in a statement.

    Blue Owl owns about a third of the Freedom Fuel properties, though the company said it leases the stores to independent contractors and “is not involved in the tenant’s operations or business decisions.”

    Fourteen stations in the 25-location network are controlled by companies linked to Shamikh and Syed Kazmi, two brothers who have been dogged by a string of civil misconduct accusations, including fraud, records show.

    Shamikh Kazmi is leasing eight of those stations from Blue Owl, according to state records and people familiar with the businesses who spoke on condition of anonymity to discuss the matter. The Associated Press was able to link the brothers to six other Freedom Network locations through records that show they listed those stations’ addresses as headquarters for other ventures or supplied those locations with fuel.

    A White House official, who insisted on anonymity to discuss the project, said that no one at the White House who was in conversations with Freedom Fuel Network had specifically spoken or worked with Syed Kazmi, a claim that indicates discussions occurred with the other brother, Shamikh.

    The Kazmis have marketed themselves as “top tier” petroleum distributors and gas station operators, with over 75 years of experience and a deep well of corporate affiliations, according to an archived version of the website for one of their companies.

    Public records offer a more nuanced portrait, showing the Kazmis have been repeatedly sued by companies they had dealings with.

    The brothers have legal issues

    Legal filings detail a series of judgments against the Kazmis, who failed to comply with a court order and have been accused of obscuring their finances and dodging service processors as a growing list of former suppliers and franchisors sought payment.

    In February, a federal judge in New Jersey ordered the Kazmis to pay over $600,000 to a fuel supplier that accused the brothers of stealing gas. The supplier alleged in court filings that it cut the brothers off after they refused to sign a new contract. But the Kazmis exploited a security lapse and gained access to the supplier’s fuel depot. Over a ten-day period in August 2021, tanker trucks absconded with more than 230,000 gallons of fuel, according to the supplier’s court filings. A judge ruled in the supplier’s favor, finding the brothers unlawfully took the gas.

    The fuel supplier says it has yet to receive payment.

    Syed Kazmi was hit with a $380,000 judgment two years ago in a suit brought by 7-Eleven, the convenience chain, which accused him of “dishonest, unethical, immoral” conduct while operating a franchise in Lawrenceville, New Jersey, that was flagged for unsanitary conditions that included trash issues and a rodent infestation. The company also said “tens of thousands of dollars” of cigarettes ordered from 7-Eleven on credit had gone missing.

    A federal judge held a company operated by Shamikh Kazmi in contempt in 2022 in a trademark case brought by BP America.

    Though BP had severed ties with Kazmi’s Diwan Petrol two years prior to the legal action, the corporation’s signage had not been removed from the gas station despite a court order to do so. The judge authorized U.S. Marshals to accompany BP workers to remove it.

    A man who answered a call to a number listed for the Kazmi brothers said he was not the right person to talk to and instead directed inquiries to the Freedom Fuel Network’s website. But that website has no contact information, phone number or mailing address. A request for comment submitted through an online contact form was not answered.

    Company formed in a state known for opacity

    Records from Delaware, a state known for offering incorporators a large degree of opacity, show the Freedom Fuel Network was registered on June 23. The document forming the company was signed by Randy Brown and Yoni Gontownik.

    Politico and the website The Newsground reported that Brown is a senior special teams coach with the Baltimore Ravens. He has also served as the elected mayor of Evesham Township, a New Jersey suburb of Philadelphia, where a Freedom Fuel Network station is located.

    Brown, a Republican, considered a run for Congress in 2021, telling a local newspaper he was a conservative and a “proud Trump supporter.”

    Gontownik is a former investment director at Mercuria, a Swiss-owned commodities trading firm. He and his wife live in northern New Jersey and have been active with the pro-Israel political action committee NORPAC, including hosting fundraisers for Republican members of Congress.

    Gontownik and Brown did not respond to requests for comment.

    Experts say gas likely sold for a loss

    Jeff Lenard, a spokesman for the National Association of Convenience Stores, said Freedom Fuel’s rock bottom promotional price meant the chain was likely selling the gas at a loss.

    “It’s not unusual for retailers to have prices that are different than a market when they’re looking to make a splash,” said Lenard, whose association’s members account for most U.S. retail fuel sales, adding that such a splash typically lasts “a matter of hours or a matter of days.”

    Social media posts and gas-price checking websites show that the per-gallon rate advertised at Freedom Fuel locations began creeping up this week.

    A Freedom Fuel station in Bensalem, Pennsylvania, for example, on Thursday was selling regular gasoline for $3.82 a gallon. That was 27 cents cheaper than at a Sunoco station across the street.

    The Freedom Fuel Network posted a note of thanks to its website this week, crediting Trump’s “strong endorsement” for the “explosive growth” of their business.

    “Despite the misinformation and baseless speculation circulating,” the statement reads, ”let us set the record straight: Freedom Fuel Network is proudly lowering its prices to benefit our community.”

  • AI stocks lead Wall Street higher, even as Brent oil’s price tops $91

    AI stocks lead Wall Street higher, even as Brent oil’s price tops $91

    NEW YORK — More gains for makers of computer chips and other winners of the artificial-intelligence boom carried Wall Street higher Tuesday.

    The S&P 500 climbed 0.9%. The Dow Jones Industrial Average added 385 points, or 0.7%, and the Nasdaq composite rose 1.3%.

    AI stocks once again were at the center of the action, and they rose for a second straight day after tumbling the week before.

    After rocketing higher because of the boom in investment in AI chips and data centers, they’ve come under pressure in recent weeks on worries that they shot too high. Concerns are also weighing that investment in AI may fall off if it doesn’t produce as much profit and productivity as hoped.

    Micron Technology jumped 12.2% and added to its 1.9% gain from the day before, coming off its 13.3% drop from last week. Nvidia added 2%, and they were the two strongest forces lifting the S&P 500.

    The gains came despite more climbs for oil prices, and Brent crude oil briefly got near $92 per barrel for the first time in more than five weeks because of continued attacks between the United States and Iran. It later pared its gain to 2% and settled at $91.01. That’s up from less than $72 early this month, which is roughly where it was before the war with Iran.

    Rising oil prices are threatening a reacceleration of inflation, just as increases for prices were slowing more than economists expected. That in turn could push the Federal Reserve and other central banks to raise interest rates, which would slow economies and undercut prices for stocks and other investments.

    The yield on the 10-year Treasury rose to 4.63% from 4.60% late Monday and from just 3.97% before the war with Iran began.

    On Wall Street, several stronger-than-expected profit reports from big U.S. companies helped stocks to strengthen despite the added pressure.

    3M climbed 7.3% after topping analysts’ expectations for both profit and revenue in the latest quarter. It also raised its forecast for profit over the full year of 2026.

    Hasbro rallied 8.8% after the toy maker said its Magic: The Gathering game topped $500 million in revenue for a quarter for the first time. It also raised its revenue forecast for the year.

    They helped offset a drop for Danaher, which slid 11% even though it likewise topped analysts’ expectations for profit and revenue.

    Homebuilder D.R. Horton slipped 0.9% despite topping profit and revenue expectations for the latest quarter. Executive Chairman David Auld said it’s still feeling the effects of affordability concerns in the housing market and caution among potential homebuyers.

    Companies broadly are under pressure to deliver strong growth in profit and revenue because of how high their stock prices have shot. Indexes are near their records, even with the recent shakiness for AI stocks.

    All told, the S&P 500 rose 65.92 points to 7,509.20. The Dow Jones Industrial Average gained 385.38 to 52,224.64, and the Nasdaq composite climbed 329.13 to 25,837.21.

    In stock markets abroad, indexes rose modestly in Europe. The United Kingdom’s FTSE 100 added 0.6% as new Prime Minister Andy Burnham hosted his first Cabinet meeting.

    In Asia, stocks swung more. South Korea’s Kospi jumped 3.6% on strong gains for its two dominant stocks. Both Samsung Electronics and SK Hynix have been big beneficiaries of the AI boom, and the Kospi has soared 60% so far this year even with its 20% drop through July.

    Tokyo’s Nikkei 225 climbed 3.3% after returning from Monday’s holiday, while indexes rose 1.8% in Shanghai and edged down by less than 0.1% in Hong Kong.

    AP Business Writers Chan Ho-him and Matt Ott contributed to this report.