Target, Best Buy warn of U.S. price hikes

Target and Best Buy warned consumers to expect higher prices as a direct result of the tariffs President Donald Trump imposed on Mexico, Canada and China overnight.

Target Chief Executive Brian Cornell said its shoppers would likely see price hikes in its stores “over the next couple of days,” in a CNBC interview on Tuesday, just hours after the tariffs went into effect.

Among the first comments on tariff impact from a major U.S. retailer, Cornell said the company has done a lot of scenario planning on goods like fruits and vegetables, a “significant amount of which” comes from Mexico during the winter, he said.

“We’re going to try to make sure we can do everything we can to protect pricing. But if there’s a 25% tariff, those prices will go up,” he said.

Shares of Target were down as much as 5.7% in New York trading following its earnings release. The company is now projecting little to no sales growth this year. The stock has fallen about 20% over the past 12 months, compared to a 14% advance for the S&P 500 Index.

Best Buy also echoed the price warnings on its own earnings call, telling investors that price increases are “highly likely” on the gadgets and appliances it sells, due to tariffs. China and Mexico are the top two sources of products for the company, Best Buy CEO Corie Barry said on Tuesday.

Best Buy shares fell as much as 15%, the most since November 2021.

Starbucks names new CFO amid shake-up

Starbucks named a new chief financial officer on Tuesday, part of an ongoing leadership shake-up at the coffee chain as CEO Brian Niccol seeks to revive sagging sales.

The company tapped Cathy R. Smith, who is joining from retailer Nordstrom, to succeed Rachel Ruggeri, who is leaving the company. Smith, 61, will start in the next month, Niccol said in a letter to Starbucks staff.

The changes at the top are part of a broader push for growth by Niccol, who became CEO in September following rare sales declines as customers became disenchanted with the retailer’s high prices and long wait times.

Niccol has brought in other new executives, enacted a revamped leadership structure and cut 1,100 corporate jobs, all with the goal of boosting efficiency and accountability.

Ruggeri worked at Starbucks for almost 20 years, becoming CFO in 2021.

CFPB drops suit targeting banks, Zelle

The Consumer Financial Protection Bureau dismissed another Biden-era lawsuit, this one targeting some of the world’s largest banks for allegedly rushing out a peer-to-peer payment network that then allowed fraud to proliferate.

The agency dropped the case against JPMorgan Chase Co., Bank of America Corp. and Wells Fargo Co. along with the parent company of the consumer payment network Zelle with prejudice, meaning it cannot be reopened, according to a filing Tuesday in U.S. District Court for the District of Arizona.

The lawsuit, filed at the end of last year, alleged that the banks’ lack of safeguards fostered “a gold mine for fraudsters, while often leaving victims to fend for themselves.” The banks said they disagreed with the action at the time.

The consumer protection agency has yanked cases against Capital One Financial Corp. and a unit of Rocket Cos. as well as one against fintech lender SoLo Funds were dropped last month.

Compiled from Bloomberg reports.