Stocks fall; Trump-Musk fight sinks Tesla

Stocks fell alongside Treasuries as online squabbling between President Donald Trump and Elon Musk knocked down Tesla Inc., dragging other megacap tech shares with it.

While equities closed away from session lows, the Nasdaq 100 dropped almost 1%. Tesla sank 14% as Trump proposed ending Musk’s government contracts and subsidies. Space-related companies surged. Earlier gains in equities were driven by hopes that tensions between the U.S. and China would ease as Trump and Chinese President Xi Jinping agreed to further trade talks.

Musk and Trump’s relationship unraveled as the president hit back at his onetime adviser for attacking the Republican tax policy bill. The tone became personal as the day progressed. Musk alleged Trump’s name appeared in files related to disgraced, late New York financier Jeffrey Epstein.

Jobless benefits applications tick up

Applications for U.S. unemployment benefits unexpectedly rose last week to the highest since October, adding to signs that the job market is cooling.

Initial claims increased by 8,000 to 247,000 in the week that ended May 31, a period that included Memorial Day. The median forecast in a Bloomberg survey of economists called for 235,000 applications.

Weekly claims tend to be volatile and fluctuate even more around holidays. However, recent data and surveys pointed to a slowdown in economic activity and sustained gains in benefit filings in the coming weeks could be a sign that layoffs are on the rise.

Procter & Gamble cutting up to 7K jobs

Procter & Gamble will cut up to 7,000 jobs, or approximately 6% of its global workforce, over the next two years as the maker of Tide detergent and Pampers diapers implements a restructuring program amid an environment dealing with trade wars and customers anxious about the economy.

The job cuts, announced at the Deutsche Bank Consumer Conference in Paris on Thursday, make up about 15% of its current nonmanufacturing workforce, said Chief Financial Officer Andre Schulten.

The cuts are part of a broader restructuring program.

ECB cuts benchmark interest rate

The European Central Bank cut its benchmark interest rate for an eighth time, aiming to support businesses and consumers with more affordable borrowing as President Donald Trump’s trade war threatens to slow already tepid growth.

The bank’s rate-setting council cut interest rates by a quarter of a point Thursday at the bank’s skyscraper headquarters in Frankfurt. Analysts expected a cut, given the gloomier outlook for growth since Trump announced a slew of new tariffs April 2 and subsequently threatened to impose a crushing 50% tariff on European goods.

The bigger question remains how far the bank will go at subsequent meetings. Bank President Christine Lagarde indicated at a post-decision news conference that much depends on whether trade tensions with the U.S. can be resolved.

“A further escalation in global trade tensions and associated uncertainties could lower euro area growth by dampening exports and dragging down investment and consumption,” Lagarde said.

Compiled from Bloomberg and Associated Press reports.