T
he Senate on Tuesday approved a $1.2 trillion proposal to improve the nation’s aging infrastructure, offering hope of a historic boost to several industries that stand to benefit from increased funding and regulations. While the bill must still clear the House, where it faces a rocky path over the next few weeks, the Senate outcome marks a major step forward in President Joe Biden’s economic agenda as the nation recovers from labor constraints and financial losses due to the pandemic.

The White House projects the bill will add roughly 2 million jobs per year for American workers, and initiatives are expected to last over the course of a decade.

Here’s a look at which industries benefit—and which don’t—from provisions of the infrastructure bill in its current form.

Winner: Big telecom—but not new innovators

Cable and fiber-optic Internet companies fare well under the bill, which allocates $65 billion to improve internet access for low-income and isolated communities.

Home internet providers like AT&T and Charter Communications would receive some $40 billion in grants to expand their networks to rural areas. An additional $14.2 billion in emergency funding would help cover the cost of broadband service for low-income Americans—around $30-a-month. Both of these initiatives would increase the number of households that could eventually become full-paying customers, benefitting the telecom industry in the long term.

But in doing so, these grants may also make it harder for new tech to keep up and compete, stifling innovation in high-speed internet technology. With more competitors delivering Internet in rural areas, it could be harder for new companies to enter the market. SpaceX, for instance, has launched hundreds of small Starlink satellites into low earth orbit in an attempt to offer high-speed, space-based Internet to rural areas—and could now have to compete with government-funded providers.

Big telecom companies stand to benefit the most from these provisions, even though a mandate to prevent practices known as “digital redlining” could prove costly by ensuring service providers don’t discriminate in where they expand networks.

Winner: Global supply chain and delivery

With roughly $130 billion in new funding for transit systems and ports of entry, supply chain and parcel industries like Amazon, FedEx and UPS will reap the benefits without having to pay for using those new roads and ports.

That’s because the bill does not include a hike in the corporate tax rate to offset the costs, which Biden proposed. Rather, funding comes from repurposed coronavirus relief money, unspent federal unemployment insurance aid, and now-defunct programs, among other sources.

Amazon, FedEx, and UPS, which provide on-the-ground shipping, rely on the nation’s highways to deliver goods. Increased spending on waterways and ports could also help grow the global e-commerce sector.

Winner: Electric vehicles

The bill’s $7.5 billion investment to develop electric vehicle charging stations across the country would provide a modest boom to the quickly-growing electric vehicle industry. Tesla CEO Elon Musk said the company plans to open its charging stations to other manufacturers’ vehicles this year, which could make the company eligible to receive part of the funds.

There are over 43,600 EV charging stations in the U.S., around 5,300 of which are fast chargers, according to the Department of Energy. As automakers like General Motors heavily invest in improving the performance and quality of their EVs, building and operating their own charging networks could be financially challenging—meaning this federal investment in charging stations would be a crucial step forward for all players in the industry.

Although Biden sought much more funding for electric vehicles, another massive investment could come later this year as the House will vote in two weeks on a second, far-more expensive package that will include clean energy initiatives.

Winner: Metals

Upgrading the nation’s physical infrastructure like roads, bridges, pipes, electric wires and rails requires an enormous amount of steel, aluminum, and copper. With approximately $550 billion in new federal spending towards commodity-intensive infrastructure projects, demand for metals is expected to increase—particularly a win for the steel industry, which is already priced at record highs and will be heavily relied on to rebuild infrastructure.

Other building materials, such as cement and lumber, could also be used for construction projects under the bill.

Winner: Nuclear power

Increased investment in nuclear energy would be a big win for operators like Exelon Corporation and uranium miners. The nuclear power industry provides 20% of the nation’s electricity, but cheaper electricity produced using natural gas and renewables has forced some reactors to close.

Despite calls from progressives to invest in renewable energy sources like solar and wind power, the bill aims to boost the struggling nuclear power industry through a four-year, $6 billion program to keep nuclear reactors in operation.

Loser: Chemical plants—and their dependents

In an effort to clean up toxic waste, the bill revives a ‘superfund tax’ on chemical producers that may increase costs for plant operations. Fees would be imposed on 42 chemicals, including many of the materials needed for infrastructure and climate improvements—such as plastics and other synthetics—at double the rates in place when the tax expired in 1995.

The revived taxes would be imposed until December 31, 2031, and apply to the production and imports of several chemicals that harm the environment when released, such as methane, butane, benzene, toluene, xylene, ethylene, propylene, butadiene, butylene, and acetylene. Under the bill, chemical producers would be charged $9.74/ton, except for methane production at $6.88/ton. Taxes on many other common chemicals, such as chlorine, ammonia, phosphorus, hydrogen fluoride, and sulfuric acid, would also be imposed.

In total, this superfund tax is expected to cost the American chemical industry more than $1.2 billion per year, and the added costs could exceed profit margins for some chemicals and plant operations. During Senate discussions, Texas Senator Ted Cruz warned that some manufacturing plants could be forced to close—or move overseas—because of the higher cost of raw materials that depend on the taxed chemicals. The prices of consumer goods could also be impacted by the regulation.

Loser: Cryptocurrency

Although some lawmakers see cryptocurrency as a source of technological innovation, industry leaders fear the bill presents an obstacle for growth. The bill would impose stricter tax-reporting requirements for cryptocurrency brokers, mandating brokers to report gains and transactions of more than $10,000 to the Internal Revenue Service similar to stockbroking practices.

However, some companies that seemingly fall under the new law, such as cryptocurrency miners, developers, and stakers, don’t have access to the technical information they’d be asked to report since they lack customers—presenting a possible challenge to the growing industry.

Leaders also fear the bill could pave the way for tighter regulation of cryptocurrency, as the plan is estimated to bring about $28 billion in tax revenue over 10 years.

Loser: Big pharma

Medicare spent more than $752 million to discard unused drugs in 2019, according to government data. More than a third of that spending came from four drugmakers alone—Takeda, Roche, Amgen, and Bristol Myers Squibb. Takeda’s Velcade drug, which treats multiple myeloma, a bone marrow cancer, only sells the drug in 3.5-milligram vials in the U.S. even though most patients need just a fraction of that—less than 2 milligrams. As a result, Medicare spent more than $114 million to safely discard Velcade in 2019, causing insurance premiums to rise.

In an effort to lower these premiums, the bill targets drugmakers to stop overpacking single-use containers starting in 2023. The bill would require drugmakers to refund Medicare for drug waste, which could force some big pharmaceutical companies to repay the government around $100 million annually for medicine that is discarded by doctors due to overpackaging. There are some exemptions to this provision—drugs that have been covered by Medicare for fewer than 18 months will not have to pay. The money the government raises through this bill would help offset part of the $550 billion in new federal spending for physical infrastructure projects.

The number of Americans seeking unemployment benefits fell for a third straight time last week, the latest sign that employers are laying off fewer people as they struggle to fill a record number of open jobs and meet a surge in consumer demand.

Thursday’s report from the Labor Department showed that jobless claims fell to 375,000 from 387,000 the previous week. The number of applications has fallen steadily since topping 900,000 in early January as the economy has increasingly reopened in the aftermath of the pandemic recession.

Filings for unemployment benefits have traditionally been seen as a real-time gauge of the job market’s health, but the measure’s reliability has deteriorated during the pandemic. In many states, the weekly figures have been inflated by fraud and by multiple filings from unemployed Americans as they navigate bureaucratic hurdles to try to obtain benefits.

Those complications help explain why the pace of applications remains comparatively high. Before the pandemic paralyzed the economy in March 2020, unemployment applications were running at about 220,000 a week.

Many states, for example, require self-employed and gig workers to first seek conventional unemployment benefits — and be turned down — before they can apply through a program that was set up last year to provide jobless aid to them for the first time. That program, and a $300-a-week federal supplemental unemployment benefit, will expire nationwide in the first week of September. About 22 states, mostly led by Republican governors, have already canceled both programs.

A total of about 12 million people are receiving unemployment benefits, down sharply from the previous week’s figure of nearly 13 million. That drop reflects that more Americans are being hired and no longer receiving benefits. Another factor is the cancellation in many states of the federal program for the self-employed and a separate program for the long-term jobless.

For now, nearly 8.7 million people continue to receive aid through those programs and will lose their benefits when those programs expire nationwide on Sept. 6.

So far at least, there has been little sign that the delta variant has depressed hiring or prompted layoffs. In July, employers added a substantial 943,000 jobs, the government said last week, and the unemployment rate sank from 5.9% to 5.4%. Average hourly earnings jumped a sharp 4% in July from a year earlier, indicating that employers have felt compelled to raise pay. Still, that report was based on a survey that was conducted in mid-July, before a surge in COVID-19 delta cases took off.

On Monday, the government reported that employers posted more than 10 million available jobs in June, the most on records dating back to December 2000. That meant there were more open jobs than there were unemployed people that month. Yet those figures, too, predate the recent spike in COVID cases.

But credit card spending on airline tickets has fallen 20% from a mid-July peak, according to economists at JPMorgan Chase, suggesting that in response to the increase in infections, consumers may be starting to slow their travel spending, which had jumped in recent months.

And after returning to pre-pandemic levels for much of June and July, restaurant traffic dropped about 10% below that level in the past week, according to restaurant software provider OpenTable.

Inflation at the wholesale level jumped a higher-than-expected 1% in July, matching the rise from the previous month, and dimming hopes that the upward trajectory of prices would begin to slow.

Prices at the wholesale level over the past 12 months are up a record 7.8%, the largest increase in that span of time in a series going back to 2010.

And the back-to-back monthly increases in the producer price index, which measures price pressures before they reach consumers, were the most sizeable since a 1.2% rise in January, the Labor Department reported Thursday.

The latest data on rising producer prices comes a day after the U.S. reported that there was some evidence of slowing in price hikes at the retail level. Consumer prices in July rose 0.5%, compared with a 0.9% jump in June. Over the past year, retail prices are up a notable 5.4%, the same 12-month gain posted in June with both months recording the largest annual gain since 2008.

July’s 1% wholesale price uptick exceeded the 0.6% gain many economists had expected and signaled the price surge that has lifted the cost of everything from airline tickets and hotels to food and gasoline, has pushed prices well above the 2% target for annual gains set by the Federal Reserve.

Core inflation at the wholesale level, which excludes volatile food and energy costs, also rose 1% in July. Core prices over the past 12 months are up 6.2%.

“Price metrics continue to be impacted by pandemic-related effects including strong demand and supply constraints,” said Rubeela Farooqi, chief U.S. economist at High-Frequency Economics. “The reopening impact should diminish over coming months but there is less certainty about supply dislocations, which could be exacerbated due to spread of the delta variant.”

Nearly three-fourths of the 1% July increase in wholesale prices were generated by the rising cost of services, which rose 1.1%. There were hefty gains in margins for autos and auto parts, which jumped 11.2%. Retail prices for new cars and used cars have been rising sharply in recent months as a computer chip shortage shuts down auto plants.

The price of goods at the wholesale level rose 0.6%, led by a 2.6% increase in energy prices, the biggest energy gain since a 5% increase in March.

Food costs actually fell 2.1%, the first price drop for food since December.

The Walt Disney Co. swung to a profit in its most recent quarter as reopened parks provided a revenue bounce.

Revenue in the parks and products division surged to $4.3 billion from $1.1 billion a year ago, as theme parks closed last year were open for part or all of this year’s quarter. Disney World in Florida has been open since last summer; California’s Disneyland only came back at the end of April.

The effect of the pandemic lingers at the parks, many of which are operating at reduced capacities, the company says. Disney is among the country’s largest employers to require worker vaccinations. It also announced in July that visitors to its U.S. theme parks must again wear masks indoors.

Asked about concerns about the infectious delta variant affecting the park business, Disney CEO Bob Chapek said on a call with analysts that the company sees “strong demand” at the parks continuing, although there have been group and convention cancellations.

Disney’s ability to keep its parks and resorts open “is clearly of the utmost importance to their bottom line,” said Third Bridge analyst Joe McCormack.

Disney on Thursday reported that its net income was $918 million in the three months through July 3, compared with a loss of $4.72 billion in its fiscal third quarter a year ago. Earnings per share came to 50 cents, or 80 cents excluding one-time items, while revenue climbed 45% to $17.02 billion.

Analysts polled by FactSet predicted earnings of 55 cents per share on revenue of $16.76 billion. Disney shares jumped more than 5% to $188.72 in after-hours trading.

As the traditional TV networks business shrinks, entertainment companies like Disney are hoping it can win the viewers of the future with streaming services. “Our direct-to-consumer business is the company’s top priority,” Chapek said. The company expects 230 to 260 million Disney+ subscribers by 2024.

Disney ended the quarter with 116 million Disney+ subscribers, about double the number from a year ago, and nearly 174 million streaming subscribers including Disney+, ESPN+, and Hulu.

Disney’s kid-friendly back catalog and original hit series like Marvel’s “WandaVision” and the Star Wars spinoff “The Mandalorian” have helped drive sign-ups as people stuck at home during the pandemic needed something to do.

While subscribers are growing, the company is making less from each one as it expands its significantly cheaper Disney+ Hotstar service in countries like Indonesia, Malaysia, and Thailand. The average amount of money it pulled from each customer fell 10% in the quarter, to $4.16; without Hotstar, which makes up about 40% of the subscriber base, it would have been $6.12.

The streaming industry leader, Netflix, has had some growing pains this year after 2020′s record-setting subscriber gains and as competition increases.

Revenue at Disney’s media and entertainment distribution division, which includes the streaming services, the TV networks, and the company’s huge movie business, rose 18% to $12.68 billion.

During the pandemic, with many theaters closed and even when reopened, attendance down, Disney has sent some movies to theaters, others to streaming services, and sometimes a mix, like it did with Marvel’s “Black Widow.” That came out in July and brought in the biggest domestic box-office haul this year, but Disney’s pandemic strategy of releasing it simultaneously on Disney+, for $30 a pop, led to Hollywood drama. Its star, Scarlett Johansson, sued Disney, saying it deprived her of potential earnings from the theater screenings. Her pay is based in part on the film’s box office.

Chapek defended how Disney had delivered films to the public and said the company will use all available options going forward. He alluded to the Johansson suit, saying the company has “figured out ways to fairly compensate our talent so that no matter what the business model is that we have to go to market with, everybody feels satisfied.”

 The World Health Organization has called for all governments to cooperate to accelerate studies into the origins of the COVID-19 pandemic and "to depoliticize the situation." read more

DEATHS AND INFECTIONS

* Eikon users, see COVID-19: MacroVitals https://apac1.apps.cp.thomsonreuters.com/cms/?navid=1592404098 for a case tracker and summary of news

EUROPE

* Britain's competition watchdog said on Thursday it will help the government take action against COVID-19 testing companies if it finds they are breaching consumer law, amid concerns about the price and reliability of PCR travel tests. read more

* Britain recorded 33,074 new cases of COVID-19 on Thursday and 94 deaths within 28 days of a positive test for the virus. read more

* Italy reported 30 coronavirus-related deaths on Thursday against 31 the day before, the health ministry said, while the daily tally of new infections rose to 7,270 from 6,968.

* Russia reported a record 808 coronavirus-related deaths in the space of 24 hours and 21,932 new cases, including 2,294 in Moscow.

ASIA-PACIFIC

* Cambodia started offering coronavirus vaccine booster shots on Thursday in a renewed public health drive after managing to inoculate more than half of its population. read more

* South Korea is considering mandating that its largest hospitals provide at least 1.5% of their intensive care beds for severe COVID-19 patients as such cases rise along with record new infections, two sources familiar with the plan told Reuters. read more

AMERICAS

* The U.S. FDA is working with vaccine makers Pfizer Inc (PFE.N) and Moderna Inc (MRNA.O) to allow certain vulnerable people to receive a third booster shot of their COVID-19 vaccines to improve their immune response, the director of the U.S. Centers for Disease Control and Prevention said on Thursday. read more

* The U.S. FDA said on Thursday that it has not seen evidence yet to suggest that the Pfizer Inc (PFE.N)/BioNTech and Moderna Inc (MRNA.O) COVID-19 vaccines are causing additional side effects. read more

* Brazil recorded 39,982 new confirmed cases of the coronavirus in the past 24 hours, along with 1,148 deaths from COVID-19, the Health Ministry said on Thursday. read more

MIDDLE EAST AND AFRICA

* The U.S. government will ship just over 500,000 COVID-19 vaccine doses to Iraq on Thursday, with the shots due to arrive in the Middle Eastern country on Saturday, a White House official said. read more

MEDICAL DEVELOPMENTS

* No new cases of rare and severe blood clots following vaccination with AstraZeneca's (AZN.L) shot have been reported in Britain in recent weeks after a decision to restrict its use in under-40s, British scientists said on Wednesday. read more

ECONOMIC IMPACT

* Global stock markets hit record highs on Thursday while the dollar and U.S. Treasury yields edged higher, building on recent strength, as the debate continued over when the Federal Reserve will start to ease stimulus.

** Oil prices fell on Thursday after the International Energy Agency (IEA) said the spread of the Delta variant of the coronavirus would slow the recovery of global oil demand.