Raphael Stevens

The Supreme Court limited the Environmental Protection Agency’s power to regulate greenhouse gas emissions from U.S. power plants, in a 6-3 ruling on Thursday.
Power plants are the country’s No. 2 source of carbon pollution, behind transportation.
Certain investment funds focus on green energy and carbon-free companies. Here’s how you can find one.

The Supreme Court last week limited the Environmental Protection Agency’s ability to regulate greenhouse gas emissions to fight climate change — and that may leave eco-conscious investors wondering what they can do.
Certain investment managers offer funds meant to promote values such as environmental preservation and social good, and those funds have become more popular in recent years.

Trying to pick a so-called environmental, social and governance fund — especially one that aligns well with your interests — can seem challenging at first, however.
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“I think it can be really hard to know where to start,” said Fabian Willskytt, associate director of public markets at Align Impact, a financial advisory firm that specializes in values-based investing.
But there are some simple steps investors trying to make an impact on climate change can take to get started and invest with confidence.

Court says Congress has regulatory authority

A coal burning power plant.
Dwalker44 | E+ | Getty Images

In a 6-3 ruling, the Supreme Court on Thursday stripped away some of the EPA’s authority to rein in planet-warming carbon emissions from U.S. power plants.

Chief Justice John Roberts and the court’s five other conservative members said Congress, not the EPA, has the power to create a broad system of cap-and-trade regulations to limit emissions from existing power plants to help transition the country from coal to renewable energy. (A cap-and-trade system is one policy mechanism to reduce emissions.)
Fossil fuel-fired power plants are the country’s second-largest source of carbon pollution in the U.S., behind transportation.

U.S. Supreme Court Chief Justice John Roberts and Supreme Court Justice Elena Kagan on Feb. 4, 2020 in Washington.
Mario Tama | Getty Images News | Getty Images

“Capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible ‘solution to the crisis of the day,'” Roberts wrote. “But it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme.”
While the decision still leaves room for the EPA to regulate emissions more broadly, many see it as a major setback for the Biden administration’s agenda to combat climate change. Meanwhile, climate legislation proposed by Democrats has been stuck in Congress.
“Today, the Court strips the Environmental Protection Agency (EPA) of the power Congress gave it to respond to ‘the most pressing environmental challenge of our time,'” Justice Elena Kagan wrote in her dissent, joined by the court’s two other liberal members.

Just what are ESG funds?

Steve Cicero | Photographer’s Choice | Getty Images

Funds that allocate investor money according to ESG issues held $357 billion at the end of 2021 — more than four times the total three years earlier, according to Morningstar, which tracks data on mutual and exchange-traded funds.
Investors poured $69.2 billion into ESG funds (also known as sustainable or impact funds) last year, an annual record, according to Morningstar.
These funds come in a variety of flavors. Some may seek to promote gender or racial equality, invest in green energy technology or avoid fossil fuel, tobacco or gun companies, for example.
Women and younger investors (under 40 years old) are most likely to be interested in ESG investments, according to Cerulli Associates survey data. About 34% of financial advisors used ESG funds with clients in 2021, up from 32% in 2020, according to the Financial Planning Association.
There are now more than 550 ESG mutual and exchange-traded funds available to U.S. investors — more than double what was available five years ago, according to Morningstar.

“An individual investor has a lot more [ESG options] and can build a portfolio in ways they couldn’t 10 years ago,” said Michael Young, manager of education programs at the Forum for Sustainable and Responsible Investment. “Almost every [asset] category I can think of has a fund option, so we’ve come a long way.”
But fund managers may use varying degrees of rigor when investing your money — meaning that environment-focused fund you bought may not necessarily be as “green” as you might think.
Here’s an example: Some fund managers may “integrate” ESG values when picking where to invest money, but that strategy may only play a supporting (and not a central) role. Conversely, other managers have an explicit ESG mandate that acts as the linchpin of their investment decisions.
But investors may not know the difference between those approaches.
The Securities and Exchange Commission proposed rules in May that would increase transparency for investors and help make it easier for them to select the ESG fund that best conforms with their values. The rules would also crack down on “greenwashing,” the practice in which money managers mislead investors about ESG fund holdings.

Here are some ESG tips for investors

Getty Images

All this might leave you thinking: How can I get started? And how can I be confident my investments truly align with my values?
There are some simple steps investors can take, according to ESG experts.
One way to start is by examining the asset manager, which serves as a good “shorthand” for investors, according to Willskytt at Align Impact.
Some firms are focused on ESG and have a long history of investing this way — both of which are encouraging signs for people serious about values-based investing, he said.

If you have confidence in the manager, the funds will be more or less strong from an ESG perspective.

Fabian Willskytt
associate director of public markets at Align Impact

Investors can get a sense of a firm’s commitment by looking at its website and whether it displays ESG as a major focus, he added. From there, investors can pick from that firm’s available funds.
“It’s a definitely a red flag if you can only find the barest of [website] information,” said Jon Hale, director of sustainability research for the Americas at Sustainalytics, which is owned by Morningstar. “It suggests the commitment maybe isn’t as high as with other funds.”
Examples of ESG-focused firms include Calvert Research and Management and Impax Asset Management, Willskytt said. Nuveen, which is owned by TIAA, also has a relatively long track record of ESG investing, he added.
Morningstar rated Calvert and Pax, along with four others (Australian Ethical, Parnassus Investments, Robeco and Stewart Investors) as the category’s asset-management leaders, according to an ESG Commitment Level assessment issued in 2020. (However, not all cater to U.S. individual investors.) An additional six, including Nuveen/TIAA, ranked a tier below in the “advanced” ESG category.

“If you have confidence in the manager, the funds will be more or less strong from an ESG perspective,” Willskytt said. “Then it’s about finding the flavors that work for you.”
There is a drawback, however. Despite ESG fund growth, investors may not yet be able to easily find a fund that corresponds with a specific issue, depending on the niche. There are plenty of climate-focused funds and broad ESG funds that account for many different value-based filters, for example, but something like a gun-free fund is harder to find, experts said.
Most (70%) of sustainable funds are actively managed, according to Morningstar. They may carry a bigger annual fee than current funds in your portfolio (depending on your current holdings).
Investors who want to learn a bit more about ESG before taking the plunge can review a free course on the basics from the Forum for Sustainable and Responsible Investment.

Taking another approach to ESG

Thomas Barwick | DigitalVision | Getty Images

Investors can also start by sifting through a few free databases of mutual funds and ETFs.
The Forum for Sustainable and Responsible Investment has one database that lets investors sort ESG funds according to categories like asset class (stock, bond, and balanced funds, for example), issue type and investment minimum.
This list isn’t exhaustive, though — it includes funds from the forum’s member firms. (However, the fact that the firm is a member may be a reliable screen for the asset manager’s ESG rigor, Young said.)
As You Sow is another organization that can help investors find funds that are fossil fuel-free, gender-equal, gun-free, prison-free, weapons-free and tobacco-free, for example. It maintains rankings of the top funds by category.

An individual investor has a lot more [ESG options] and can build a portfolio in ways they couldn’t 10 years ago.

Michael Young
manager of education programs at the Forum for Sustainable and Responsible Investment

Alternatively, investors can also use As You Sow’s website to gauge how well their current investments align with their values. They can type in a fund’s ticker symbol, which generates a fund score according to different value categories.
Other firms also assign ESG ratings to specific funds. Morningstar, for example, assigns a certain number of “globes” (“5” being the best score) so investors can assess the fund’s ESG scope. Morningstar has an ESG Screener that also lets investors filter for funds according to certain parameters.  
One caveat: The globe system and other third-party ratings don’t necessarily signal an asset manager’s ESG intent. In theory, a fund could have stellar ESG ratings by accident, not due to a manager’s focus.  
Investors also can use fund databases to identify ESG investments they might like, then research the asset-management firm to see how committed the firm is to ESG overall.
For investors who aren’t as do-it-yourself oriented, working with a financial advisor well-versed in ESG may be the most surefire way to know your investments most square with your values and mesh with your overall portfolio and investment goals. Advisors may have more advanced screening tools at their disposal relative to a retail investor, for example.

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The share of new car buyers with a monthly payment of more than $1,000 jumped to a record high, according to Edmunds.
With elevated prices and limited inventory due to supply chain challenges, the car market isn’t expected to improve anytime soon.

If you can even find a new car to buy, actually purchasing it is going to cost you.
“It’s a really difficult time to buy a car,” said Jessica Caldwell, executive director of insights at Edmunds.

Limited inventory due to a persistent shortage of computer chips, along with other supply-chain challenges, helped propel new car prices up 12.6% from a year ago and used car prices 16.1% higher, according to the latest data from the U.S. Bureau of Labor Statistics.
For new cars, the average transaction price is expected to reach an all-time high of $45,844 in June, according to a separate J.D. Power/LMC Automotive forecast. 

Rising interest rates mean higher loan costs  

At the same time, financing any type of vehicle is also getting more expensive, as the Federal Reserve’s latest interest rate hike of 0.75 percentage point pushes up the cost of auto loans.
“Low-interest rates used to be one of few reprieves for car shoppers amid elevated prices and supply shortages,” Caldwell said. “But the Fed rate hikes this year are making finance incentives far costlier for automakers, and consumers are starting to feel the pinch.”
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The average annual percentage rate on a new car hit 5% for the first time since the beginning of 2020, according to June data from Edmunds. 
While an increase of about 1 percentage point may not seem like much, jumping to an APR of 5% from 4% could cost consumers $1,324 more in interest over the course of a $40,000, 72-month car loan, Edmunds experts said.

And still, luxury shoppers are flocking to dealerships, willing to spend more on high-end cars and the financing to go along with them.
For the first time, just over 12% of consumers who financed a new car in June committed to a monthly payment of $1,000 or more — the highest level on record — compared with 7.3% one year ago, Edmunds found.
“Although there appears to be a steady stream of affluent consumers willing to commit to car payments that look more like mortgage payments, for most consumers the new car market is growing increasingly out of reach,” Caldwell said. 

There appears to be a steady stream of affluent consumers willing to commit to car payments that look more like mortgage payments.

Jessica Caldwell
Edmunds’ executive director of insights

With the lucrative luxury SUV segment in high demand, more carmakers are upgrading their lineups and scaling back on smaller cars, Caldwell noted.
“There aren’t a lot of options on the lower end.”
Factoring in near record-high gas prices, the problem of affordability isn’t expected to improve anytime soon, she added.
Typically, dealers offer some incentives to unload excess inventory before new models hit the lot, but not this year.
“Don’t expect a lot of end-of summer sales; there’s really no inventory to clear out at this point,” Caldwell said. “If you want to wait for prices to get better, it will probably be a while.”
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Ford on Tuesday reported a 1.8% uptick in second-quarter sales compared with a year earlier, including a 31.5% increase in June.
Analysts expected the Detroit automaker’s second-quarter sales to increase between 3.3% and 5.1%.

Electric Ford F-150 Lightning
Andrew Evers / CNBC

DETROIT – Ford Motor on Tuesday reported a slight increase in new vehicle sales for the second quarter that missed automotive analysts’ expectations.
The company said sales rose 1.8% to 483,688 new vehicles in the second quarter compared with a year earlier, but noted that results improved in June and were up 31.5% for the month. Analysts expected the Detroit automaker’s sales to rise between 3.3% and 5.1%.

Ford’s results easily outperformed the industry during the quarter, as overall sales were forecast to be down between 19% and 21% from the year-ago period. Automakers have been scrambling to rebuild dealer inventories that have been hit hard by production cuts amid a global shortage of semiconductor chips and other key automotive components.
Shares of Ford hit a 52-week low of $10.61 on Tuesday. The stock was at around $10.90 in afternoon trading, down more than 3%. Shares of the automaker have declined 47% in 2022.
Ford was significantly impacted a year ago by the chip shortage, which was largely the result of a fire at one of its suppliers in Japan that forced production cuts during the first half of 2021.
“Amid industry-wide supply constraints, Ford outperformed the industry driven by strong F-Series, Explorer and new Expedition and Navigator SUV sales,” Andrew Frick, Ford’s vice president of sales, distribution and trucks, said in a release.
The company said demand remains strong, with a record 50% of retail sales coming from customer orders in June, rather than from purchases out of dealer inventories. Automakers have pushed customers to order vehicles, which helps companies better measure demand and plan accordingly. Ford said its retail sales were up 30.3% last month compared with a year earlier.

Notably, Ford’s sales of F-Series pickups improved to 57,673 units in June – their highest monthly total of 2022. The sales include the F-150, including an all-electric version, and larger iterations of the pickup.
Sales of the company’s electric F-150 Lightning continue to ramp up. Ford said it sold 2,296 of the trucks since it went on sale in late May, including 1,837 in June.
Ford said sales of its electric vehicle – F-150 Lightning , Mustang Mach-E and E-Transit – jumped 76.6% to 4,353 in June from a year ago. For the first half of the year, it said EV sales totaled 22,979 units, up 77% from the same period in 2021.

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Yum Brands is close to selling its Russian KFC restaurants.
The company sold its Pizza Hut franchises in May.
Yum Brands said that once the KFC transaction is complete, the company will exit Russia completely.

A woman walks near closed KFC and McDonald’s restaurants that suspended their business in Russia due to the military invasion of Ukraine, April 16, 2022, in Moscow, Russia.
Konstantin Zavrazhin | Getty Images

Yum Brands is close to selling its Russian KFC business as part of its plan to exit the country’s market, the company announced Tuesday.
The company said it plans to fully exit Russia once the KFC transaction is complete. Since March, Yum said it has been redirecting any profits from its Russian operations to humanitarian efforts as it works to exit the country. The restaurant company added it is stopping all investment, restaurant development and operations in the country.

It sold its Russian Pizza Hut franchises, which are currently being rebranded, in May.
Yum Brands, which also owns Taco Bell, first announced in March that it would be suspending KFC and Pizza Hut operations in Russia, when it activated a disaster relief fund and made donations to the Red Cross, UNICEF, World Food Programme and International Rescue Committee.
Yum is the latest Western restaurant operator to wind down its Russian operations after Kremlin forces invaded Ukraine. McDonald’s sold its Russian locations to an existing licensee in May.
Of the more than 54,000 locations Yum Brands has around the world, there were about 1,000 KFC locations and 50 Pizza Hut locations in Russia, most of which operated under franchise agreements.

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The Italian government declared a state of emergency on Monday in five regions because of a drought caused by lack of rain and rising temperatures.
“For the Po basin, this is the most serious water crisis of the last 70 years, according to analysis by the Po River District Basin Authority,” Prime Minister Mario Draghi said.
The Po River runs east across the northern part of Italy from the Pian del Re of Monte Viso to the Adriatic Sea near Venice, and is the longest river in Italy.

This picture taken on July 2, 2022 in Rome shows the low water level of the river Tiber near the Vittorio Emanuele II bridge, revealing an ancient bridge built under Roman Emperor Nero (Bottom).
Andreas Solaro | AFP | Getty Images

The Italian government declared a state of emergency on Monday in five regions because of a drought caused by lack of rain and rising temperatures.
To help the regions that have been especially hard hit, Italy is sending $37.5 million in relief funds distributed to the Emilia-Romagna, Friuli Venezia Giulia, Lombardy, Piedmont and Veneto regions, according to a statement by the Italian government.

“For the Po basin, this is the most serious water crisis of the last 70 years, according to analysis by the Po River District Basin Authority,” Prime Minister Mario Draghi said on Thursday, in a translation of the statement.
The Tiber River, which flows through central Italy and Rome and is seen flowing under the famous Vittorio Emanuele II bridge in the image above, is also running at very low levels.

Damaged soy plants affected by salty seawater flowing into drought-hit River Po are pictured in Porto Tolle, Italy, June 23, 2022. Picture taken 23, 2022. 
Guglielmo Mangiapane | Reuters

The Po River runs east across the northern part of the country from the Pian del Re of Monte Viso to the Adriatic Sea near Venice, according to European Commission data. It is the longest river in Italy and 17 million people, or one-third of the total population, live in its basin.

A barge that was sunk during WWII lies on Po’s dry riverbed as parts of Italy’s longest river and largest reservoir of freshwater have dried up due to the worst drought in the last 70 years, in Gualtieri, Italy, June 22, 2022. 
Guglielmo Mangiapane | Reuters

The crisis comes from three years of drought and warmer temperatures, Draghi said.
“There are two categories of causes for this water crisis: One is the rainfall deficit of the last three years. There has been a low level of rainfall, of course not just this year but also in previous years,” Draghi said on Thursday. “The general rise in temperatures is also contributing; there is no doubt that climate change is having an effect.”

One of the pylons of the bridge that crosses the river Po in the municipality of Boretto, in the province of Reggio Emilia, Italy on June 27, 2022.
Andrea Carrubba | Anadolu Agency | Getty Images

Also, Italy is losing water from the Po River because of what Draghi called “structural causes,” meaning “poor maintenance of the basins, poor network maintenance.”  
“This is why, in Italy, there is an unusually high level of leakage, of water being lost: we’re talking about 30 per cent or more,” Draghi said. “To give you an idea, the total in Israel is 3% and in other European countries 5-6-8%. An emergency plan is undoubtedly needed to deal with this emergency now.” 

The Fountain of the Months (Fontana dei Mesi) is pictured closed to avoid wasting water, in the Valentino Park, Turin, Italy June 19, 2022. 
Massimo Pinca | Reuters

The Po River and surrounding drainage basins are important regions for agriculture and livestock. More than half the national stock of cattle, 3.1 million animals, and 65% of the national stock of pigs, or 6 million animals, live in the region, according to European Commission data.
The drought has devastated Italy’s rice crop, wiping out 30% of the total harvest, according to a statement Sunday from Coldiretti, an agricultural organization in the European Union.
The devastation to the rice crop is coming at an especially painful time for the industry because it had already decreased its seed planting by 10,000 hectares due to a “record increase in production costs” caused by the war in Ukraine, Coldiretti said.

A man walks on the dry riverbed of Sangone river, a tributary of the Po river, which experiences its worst drought for 70 years, in Beinasco, Turin, Italy June 19, 2022.
Massimo Pinca | Reuters

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The Bank of England said Tuesday that the global economic outlook has “deteriorated materially” and warned of possible further shocks to come.
Governor Andrew Bailey blamed Russia’s invasion of Ukraine for piling further pressure on commodity prices and already rising inflation.
“It is the right time to lock in resilience so that we are well prepared for future possible shocks,” he said.

Andrew Bailey, governor of the Bank of England, has said the global economic outlook has deteriorated materially after surging commodity prices pushed up inflation around the world.
Bloomberg | Bloomberg | Getty Images

LONDON — The governor of the Bank of England said Tuesday that the global economic outlook has “deteriorated materially” and warned of possible further shocks to come.
Andrew Bailey blamed Russia’s invasion of Ukraine for piling further pressure on commodity prices and already rising inflation, and said that further resilience is needed to mitigate future risks.

“The global economic outlook has deteriorated materially,” Bailey said at a briefing at the Bank of England.
“It is the right time to lock in resilience so that we are well prepared for future possible shocks,” he added.
The warning came as the central bank published its Financial Stability Report Tuesday, in which it outlined a number of risks to the U.K.’s economic outlook. Those include ongoing disruption to food and energy markets as a result of the war, high household and government debt, as well as the continued impacts of Covid-19 in China.

We expect households and businesses to become more stretched over coming months.

Andrew Bailey
governor, Bank of England

The BOE, alongside other central banks, has been raising interest rates in a bid to bring down high prices. However, Bailey acknowledged that this had made the economic landscape harder for households and businesses, and that there was little sign of let up in the near-term.
“These higher prices, weaker growth and tighter financing conditions will make it harder for households and businesses to repay or refinance debt,” he said.

“Given this, we expect households and businesses to become more stretched over coming months. They will also be more vulnerable to further shocks,” he said.

BOE lifts banking capital demands

The comments came as the Bank on Tuesday lifted its countercyclical capital buffer rate (CCyB) for banks from 1% to 2%, starting in July 2023. Central banks increase the regulatory capital demand when they believe risks are building up.
Bailey said the Bank’s Financial Policy Committee would be willing to continue readjusting the rate as needed.
“Given considerable uncertainty around the outlook, the FPC will continue to monitor the situation,”  he said. “We stand ready to vary the UK CCyB rate — in either direction — depending on how risks develop.”

In sharp contrast to the financial crisis, it is in a position to cushion the economic shocks, not add to them.

Andrew Bailey
governor, Bank of England

Bailey also said the BOE would move ahead with its annual stress test in September, evaluating the U.K. banking system’s ability to handle various potential risks, including higher interest rates, asset price falls and “deep” recessions.
However, he added that the sector looks generally strong and that lenders are much better placed now than during the 2008 Global Financial Crisis to handle a severe economic downturn.
“The economic outlook is uncertain and undoubtedly a very challenging one for many households and businesses,” he said.
“The banking system is resilient to that outlook, however, or even a much worse one. In sharp contrast to the financial crisis, it is in a position to cushion the economic shocks, not add to them.”

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England win fifth Test by seven wickets, chasing record total of 378, beating their previous best of 359 when Ben Stokes blasted them to victory at Headingley in the 2019 Ashes.
Ensures the five-match series with India is drawn 2-2.

England’s Jonny Bairstow, following a slightly nervy spell in the 90s, eventually brought up a fine hundred.
Geoff Caddick | Afp | Getty Images

Joe Root and Jonny Bairstow both scored majestic hundreds as England made history in successfully chasing 378 to win the rescheduled fifth LV= Insurance Test against India at Edgbaston and draw the series 2-2.
England needed 119 further runs to pull off their highest-ever successful run chase in Test cricket on the final morning, but rather than being a nerve-wracking affair, Root (142no) and Bairstow (114no) made a mockery of the target, guiding England home inside 20 overs.

Under cloud-laden skies, India found a bit of reverse swing early on, but their seamers failed to control it, gifting England’s in-form pair far too many boundary opportunities which they did not miss out on.
The biggest battle of the day ultimately proved to be the one between Root and Bairstow as to who would bring up their century first, with Root winning out as he notched his 28th in Test cricket, bringing it up in 136 balls, before then playing some increasingly audacious shots – including another remarkable reverse-ramp for six – as the required runs were rapidly ticked off.
Bairstow, following a slightly nervy spell in the 90s as Root raced through the gears at the other end, eventually brought up his own fine hundred – his third in successive innings, sixth in the calendar year and 12th overall – off 138 balls.
Fittingly, Root – who captained England during the first four Tests of the series last summer – ticked off the winning runs shortly after midday, England’s fourth run-chase of more than 250 this summer, extending their record, and their greatest ever, beating the Ben Stokes-inspired 359 achieved at Headingley in the 2019 Ashes.
England were no doubt favorites heading into the final morning, but a sharp rising delivery from Mohammed Siraj that whizzed by Root first up was a reminder that there could still be some twists and turns along the way as India hunted early wickets.

They had the perfect conditions to do so, but with some curious field settings and some wayward bowling to go with them, the game and therefore their hopes of securing only a fourth series victory in England soon got away from them.
Bairstow signaled his intent with back-to-back boundaries blasted off Mohammed Shami’s second over of the day, though the bowler did respond well to beat the outside edge to finish.

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It was not the only occasion the ball flew past the outside edge of Bairstow’s edge, as he had the odd lazy waft outside off stump, but that was about the extent to which England’s batsmen were troubled on the final morning.
Bairstow moved into the 90s first, but he was soon overtaken by his great mate at the other end as Root played a beautiful, delicate late cut for four off Jasprit Bumrah, before then clipping another to the midwicket fence as the bowler overcorrected in line. That brought up the 200 partnership between the pair, swiftly followed by Root’s century as Siraj was the next in line for punishment.
Bairstow took a little while longer to bring up his latest hundred as he continues to enjoy a staggering resurgence in Test cricket, but did eventually reach three figures shortly before the winning runs were ticked off.

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