GDP Estimate for Q1 Contracted More Than Expected, Setting Stage for Potential Recession

Farm bill listening session highlights need for grain producer margin coverage, CCC watch

The final estimate for first-quarter GDP was published this morning and showed GDP contracted slightly more than expected in the first quarter of 2022, declining 1.6% versus the initial reading of a 1.5% decline. This sets the stage for a potential recession reading next month. A rise in the trade deficit to a record mark was largely behind the slightly larger decline as both consumer and business spending rose in the first quarter. However, consumer spending was not as strong as initial figures suggested.

Ukrainian president calls for kicking Russia out of the U.N. Security Council for “its terrorism.” Volodymyr Zelenskyy also proposed that U.N. officials visit the site of the mall where at least 20 people died and dozens more were wounded in a missile attack Monday. Russia has denied targeting the mall, saying it caught fire after a nearby weapons store came under fire.

NATO is on course to add vast territory and new military abilities by admitting Finland and Sweden, after Turkey agreed. Russia earlier responded to the prospect by threatening to station ballistic missiles and nuclear weapons on its border.

EIA to publish some data previously delayed. The Energy Information Administration (EIA) said that it will publish the Weekly Petroleum Status Report today (June 29) at its regularly scheduled time, including data for the week ended June 17 that would have been published June 22, and June 24. As it continues its system restoration process, EIA said “ongoing issues affecting other data releases that have been delayed.” It is not yet clear which other data has been affected and whether that includes ethanol production and stocks data as those have not been released since the week ended June 10. However, that data is in the Weekly Petroleum Status Report and presumably will be included in the release today.

USDA releases its quarterly hogs and pigs report at 3 p.m. ET. The last several reports have been followed by bullish price reactions. The report is expected to show the U.S. hog herd continued to contract, with the average estimate for the June 1 inventory down 0.7% from year-ago. The breeding herd is expected to be down 1.1% and the market hog inventory down 0.7%. Analysts expect spring farrowings declined 1.4%, with summer and fall farrowing intentions anticipated to be down fractionally from last year.

The Financial Times has an interesting item detailing what could be alleged Russian stealing and exporting of Ukrainian grain. Details in Russia/Ukraine section.

A ship traveling from Russia to Louisiana with a cargo of fuel products was stopped by U.S. authorities.

War and weather are imperiling global food supplies, U.S. agriculture officials and executives said at the Wall Street Journal’s Global Food Forum.

Rice has generally been cheaper than it was last year — a boon for the many Asian countries where it is integral to diets.

Rural counties are booming after years of lagging behind big cities. Let’s hope it lasts. Details below.

Travel strains have business travelers changing plans. Some are driving instead of flying. Meanwhile, Delta Air Lines is allowing customers to change flights at no cost over the Fourth of July weekend.

A South Dakota farm bill listening session by House Ag Republicans noted what we’ve been highlighting lately: A need for margin coverage in grain and oilseed producers’ safety net programs, and questions about USDA Sec. Tom Vilsack’s aggressive use of Commodity Credit Corporation (CCC) funds for his favorite ideas. Farmers attending the sessions touted the importance of crop insurance and the need for a more effective safety net when record prices end.

The European Union has agreed to a framework to eliminate carbon emissions from new cars and vans by 2035. Details in Energy section.

A panel of outside advisors to the FDA has voted 19-2 in favor of updating COVID-19 booster shots to include protection against Omicron. Details below.

Tuesday’s primaries and runoffs saw the downfall of at least three House incumbents, including Rep. Rodney Davis (R-Ill.). Details in Politics section. The Cook Political Report with Amy Walter notes that “One of the bigger storylines from Tuesday’s primary was the extent to which Democrats meddled in GOP statewide primaries, with the goal of helping to elect the weaker (and usually more Trump-oriented) candidate.” It notes that three House incumbents lost on Tuesday: Davis (R) and Newman (D) in Illinois, Palazzo (R) in Mississippi. GOP voters nominated Trump-endorsed Bailey in Illinois governor race, while in Colorado, centrist GOPers win Senate, governor and CO-08 races.

The Supreme Court has reinstated a Republican-drawn congressional map in Louisiana after a lower court found that the redistricting violated the Voting Right Act by concentrating Black voters into a single district.

Equities today: Global stock markets were mostly lower overnight. U.S. Dow opened 100 points higher but then went slightly lower. Nasdaq was down slightly. A series of data releases (see below for details) showed that higher prices are weighing on consumer sentiment. A new consumer report showed that Americans are not confident in the economy but are confident that inflation will be sticking around for the next year. Meanwhile, central bankers, including the Federal Reserve’s Jerome Powell and the European Central Bank’s Christine Lagarde, will be closely watched today for comments on the economy, inflation and the path of interest rates ahead. In Asia, Japan -0.9%. Hong Kong -1.9%. China -1.4%. India -0.3%. In Europe, at midday, London -0.7%. Paris -1.4%. Frankfurt -2%.

U.S. equities yesterday: The Dow fell 491.27 points, 1.56%, at 30,946.99. The Nasdaq declined 343.01 points, 2.98%, at 11,181.54. The S&P 500 lost 78.56 points, 2.01%, at 3,821.55.

Agriculture markets yesterday:

• Corn: July corn futures rose 15 1/4 cents to $7.59 1/2, while December corn gained 6 1/4 cents to $6.59 1/4.
• Soy complex: July soybeans jumped 33 1/4 cents to $16.63 3/4, while November soybeans surged 29 3/4 cents to $14.62 1/2. August soymeal gained $5.10 to $419.70 and August soyoil climbed 115 points to 69.00 cents.
• Wheat: September SRW wheat rose 18 1/2 cents to $9.36 a bushel, up from Monday’s four-month closing low, while September HRW wheat rose 11 1/2 cents to $9.90 1/4. September spring wheat fell 3 3/4 cents to $10.40 3/4.
• Cotton: December cotton fell 57 points to 93.48 cents per pound, the contract’s lowest closing price since Jan. 3.
• Cattle: August live cattle fell 75 cents to $132.725. August feeder futures fell $2.30 to $171.825.
• Hogs: August lean hogs fell $1.05 to $103.825, closing near the session low.
  

Ag markets today: The corn, soybean and winter wheat markets built on Tuesday’s strong gains overnight, while spring wheat firmed after small losses yesterday. As of 7:30 a.m. ET, corn futures were trading fractionally to 6 cents higher, soybeans were 6 to 12 cents higher and wheat futures were 9 to 16 cents higher. Front-month U.S. crude oil futures were around $1 higher and the U.S. dollar index was modestly lower this morning.

Technical viewpoints from Jim Wyckoff:

On tap today:

• U.S. gross domestic product for the first quarter, due at 8:30 a.m. ET, is expected to contract at a 1.5% annual pace, unchanged from a previous reading. UPDATE: The final revision of first-quarter gross domestic product confirmed a larger contraction of the U.S. economy than earlier readings, supporting the view that a recession is either in progress or coming, say economists. The latest report showed that gross domestic product, the broadest measure of goods and services produced across the economy, shrank by 1.6% on an annualized basis in the three-month period from January through March. The initial report released in April showed GDP shrank by 1.4% on an annualized basis.
• Federal Reserve Chairman Jerome Powell, Bank of England Gov. Andrew Bailey and European Central Bank President Christine Lagarde participate in an ECB Forum on Central Banking at 9 a.m. ET.
• Fed speakers: Cleveland’s Loretta Mester at the ECB forum at 11:30 a.m. ET and St. Louis’s James Bullard on the economy at 1:05 p.m. ET.
• USDA Hogs & Pigs report, 3 p.m. ET.
• China’s official purchasing managers indexes for manufacturing and services in June are out at 9:30 p.m. ET.

What financial watchers are watching:

• A panel discussion at the European Central Bank’s Sintra conference that includes the heads of the Federal Reserve, ECB, Bank of England and Bank for International Settlements will be a key event today, with traders looking for clues on central bank policy and the inflation outlook.
• Euro-area inflation data gave mixed signals earlier, with German numbers coming in lower than expected while Spain’s headline print unexpectedly rose to double figures.
• Morgan Stanley economists said they see the euro-area entering a recession in the final quarter of this year.
• On Fed policy, Cleveland Fed President Loretta Mester said she wants to see the benchmark lending rate “a little bit above 4% next year.” Mester told CNBC she’d advocate for a 75-basis point hike in July. She said the Fed is “just at the beginning” of raising interest rates to control inflation and wants to see the benchmark lending rate reach 3% to 3.5% this year and “a little bit above 4% next year” to rein in price pressures even if that tips the economy into a recession.
• The CEO of Maersk, a bellwether for global trade, said the container line’s freight volumes don’t yet show signs that world economy is headed for a downturn.
  

Consumers’ short-term outlook for the U.S. economy dropped to its lowest point in nearly a decade on concerns about inflation. The Conference Board’s consumer-confidence index, which hints at American attitudes toward jobs and the economy, dropped to 98.7 in June from 103.2 in May. The board’s expectations index, which measures consumers’ short-term outlook about the labor market, business and income, tumbled to 66.4, its lowest reading since March 2013. The survey adds to evidence that inflation is weighing on households.

The University of Michigan’s closely followed survey of consumer sentiment, which polls consumer attitudes on personal finance, this month dropped to its lowest point on record. When consumer sentiment and confidence decline in tandem, spending usually decreases with it, said Bernard Baumohl, chief global economist at the Economic Outlook Group. “Consumers are the bedrock of the economy,” he said. “They have been on an emotional roller coaster the last 2½ years, and we’re seeing now that they are pretty much close to the breaking point.”

More than one fifth of women who gave birth in the U.S. in 2020 were born outside the country, according to government data published for the first time. Most were from Latin America, with almost a quarter coming from Mexico in particular.

U.S. exports rose to a record of $176.6 billion in May and imports were little changed at $280.9 billion, leaving the narrowest merchandise-trade deficit of the year and adding a tailwind to economic growth in the second quarter. Exports were boosted by gains in industrial supplies such as petroleum products, as well as increases in the value of shipments of consumer goods and motor vehicles. More complete May trade figures that include the balance on services will be released on July 7.

Vehicle sales in the U.S. are expected to fall 17.3% this year to the lowest level in a decade as semiconductor shortages and other supply-chain problems hamper production. Meanwhile, Toyota produced 5.3% fewer vehicles in May than a year earlier.

Vietnam’s economy grew at the fastest pace in nearly a decade in the second quarter, thanks to a rebound in exports and manufacturing that helped offset risks from coronavirus outbreaks.

Sound familiar? The price of basic goods in U.K. stores is rising at the fastest pace in almost 14 years, leaving poorer families taking drastic action to make ends meet, according to surveys published Wednesday.

The broad economic prospects for rural America may be looking up for the first time in years, even in the face of inflation and the risk of recession, the WSJ reports (link). Small communities have long lagged far behind big cities in job creation and income growth. But since the pandemic, many are seeing an infusion of remote workers drawn by lower costs, laid-back lifestyles and natural beauty — and worn down by crime and other urban challenges. Their presence has helped spur hiring, income gains and home-price growth in rural towns. The question now is whether these transplants are there to stay.

Market perspectives:

• Outside markets: The U.S. dollar index is near steady in early U.S. trading. The yield on 10-year Treasuries declined two basis points to 3.15%. Bitcoin traded around $20,000. West Texas Intermediate crude rose 1.4% to $113.35 a barrel. Gold futures rose 0.6% to $1,832.90 an ounce.

• CEO of Exxon Mobil sees oil prices climbing further. The head of the oil giant told the Financial Times that higher prices will lead to more investment and production from energy firms. “They always say the cure to high prices is high prices,” Darren Woods said.

• World’s largest lithium producer is urging the U.S. gov’t to cut red tape to accelerate a build-out of a domestic supply chain for materials needed for batteries, electric vehicles and cleaner technologies while cutting dependence on China.

• Ocean and air rates have moderated from their peaks but remain well above pre-pandemic levels. Elevated rates should contribute to strong margins and earnings for forwarders through 2022, according to Bloomberg Intelligence’s Lee Klaskow.

• Bulging warehouses. Responsible for 42% of all containerized trade with Asia, the US’ largest hubs of Los Angeles and Long Beach in Southern California are dealing with an influx of cargo.

• As of mid-June, global corn and wheat prices were 27% and 37% higher, respectively, than in January. In contrast, rice prices were about 17% lower, according to the World Bank, amid good harvests from the world’s top producers.

• Ag trade: Taiwan purchased 40,000 MT of U.S. milling wheat and 55,000 MT of corn (likely to be sourced from South Africa). South Korea tendered to buy up to 140,000 MT of corn from the U.S., Black Sea region/eastern Europe, South America or South Africa. Jordan tendered to buy 120,000 MT of optional origin milling wheat.

• NWS weather: Locally heavy rain and isolated flash flooding remains possible across the Southeast, Gulf Coast, and Southwest... ...Severe thunderstorms to potentially impact the northern Plains today, with well above average temperatures and critical fire weather extending from the central High Plains to the middle Missouri Valley.

Items in Pro Farmer’s First Thing Today include:

• Followthrough buying in corn, soybeans and winter wheat
• PBOC promises stepped-up prudent monetary policy
• Xi defends Covid strategy (details in China section)
• Malaysia to spend $84 million subsidizing chicken and egg prices
• Beef movement improves as prices drop
• Hog traders have prove-it attitude

— Summary: The U.K. government has sanctioned Russian billionaire Vladimir Potanin, the country’s richest person, as tensions rise over the war in Ukraine. The nickel magnate was able to scoop up Russian banking assets earlier this year while other oligarchs were hit with international sanctions.

• NATO poised to welcome two new members. Sweden’s and Finland’s bids to join the security alliance took a big step forward when Turkey gave them its blessing. By adding the two Nordic countries to its club, NATO would more than double the length of its border with Russia, the global power it was formed to counteract. In response to Russia’s invasion of Ukraine, NATO has launched its biggest mobilization since the end of the Cold War.
• More U.S. troops. President Joe Biden said in Madrid on Wednesday that his country would set up a permanent headquarters in Poland for the Fifth Army Corps, maintain an additional rotational brigade of thousands of troops in Romania and bolster other deployments in the Baltic states. The U.S. will also send two more F-35 squadrons to the UK and add to air-defense systems in Germany and Italy. That adds to 100,000 U.S. troops already in Europe. “In a moment where Putin has shattered peace in Europe and attacked the very, very tenets of the rule-based order the United States and our allies — we’re stepping up,” Biden told reporters. “The steps we’re taking during this summit are going to further augment our collective strength.” The Russian president is “getting the NATO-ization of Europe,” Biden said.
  

— Market impacts:

• FT: Ships going dark: Russia’s grain smuggling in the Black Sea. The Financial Times tracked vessels leaving Sevastopol port in the Crimea, a port which has been hit by sanctions that preceded the Russian invasion of Ukraine. Ukrainian officials allege that Crimean ports are being used to export grain that Russia has stolen from Ukraine in areas now occupied by Russian forces in the southeastern part of Ukraine. While the FT acknowledged no evidence that grain being shipped out of Crimea was stolen from parts of Ukraine now occupied by Russia, “there is a pattern of activity that indicates a rise in smuggling from Crimea.” FT said their analysis of satellite photos and port records indicated around 140,000 tonnes of grain was exported from Sevastopol. The shipments appear to be supported by activity at Port Kavkaz in Russia, a hub for ship-to-ship transfers of cargo via anchorages outside of the port. The report also noted ships have shut off transmitters that provide their location, making it harder to track them. Link for details.
• U.S. authorities stopped a tanker full of Russian crude products on the way to New Orleans. The ship was planning to arrive at the port on Sunday. The U.S. banned Russian crude imports in early March.
• Russia, one of the world’s largest oil exporters, has seen its oil revenue surge despite moves by the West to stop buying Russian crude.

• Russia’s invasion of Ukraine is not stopping the flow of raw materials to European steel plants. Import volumes of some Russian steelmaking ingredients into Europe are surging, the Wall Street Journal reports (link), even after the continent’s steelmakers said they would avoid Russia-sourced raw materials. Russian exporters boosted shipments of Russia-sourced ferrotitanium, a metallic alloy used to strengthen steel, by 30% in March from the previous month and far above the average in the months before the invasion. Traders say bargain-hunting buyers are capitalizing on a discount for Russian products amid wide-ranging sanctions, while boosting purchases ahead of possible sanctions on the ingredient itself. The shipments show how markets are responding to sanctions and the threat of restrictions, complicating Western efforts to isolate Russia’s economy. One trader says that as long as Western governments avoid sanctioning ferrotitanium, “most steel plants are buying.”

— House Ag Committee Ranking Member focuses on margins, CCC use by USDA in South Dakota farm bill confab. House Agriculture Committee Ranking Member GT Thompson (R-Pa.) joined Rep. Dusty Johnson (R-S.D.) in South Dakota for a farm bill listening session, talking about the need for the coming farm bill to address issues of margins being faced by farmers. “Where we may have record prices now, American farming is a business, and so it’s the margin you’re left with at the end of the day, and where we have programs that are not driven by margin, they’re driven by the actual reference price, that’s probably something we need to take a look at,” Thompson said. He also took issue with the use of Commodity Credit Corporation (CCC) authority by USDA Secretary Tom Vilsack, saying the USDA chief was using it as his own personal fund to push forward on policy goals that have not been cleared by Congress. Farmers at the session as expected noted crop insurance is a critical component of the farm bill that needs to be maintained and that the existing farm bill safety net programs need to be modernized.

— Tight Covid restrictions and lockdowns in China took a toll on the nation’s economic growth during the second quarter, according to a new report (link). Various sectors suffered a slowdown, including transportation and services, according to the U.S.-based China Beige Book, which says it conducted more than 4,300 interviews in China during the three-month period. Hiring slowed down, as well, according to the study, and likely won’t pick up again until the Chinese government provides more stimulus this fall.

— Xi defends Covid strategy. Chinese president Xi Jinping said the ruling Communist Party’s strategy to tackle the Covid-19 pandemic was “correct and effective” and should be firmly adhered to, the official Xinhua news agency reported. China would have suffered “unimaginable consequences” had it adopted a strategy of “lying flat,” Xinhua quoted Xi as saying. The strict Covid policies slowed China’s economy, but Xi said Beijing would accept some temporary impact on economic development rather than let people’s lives and health be harmed.

— Biden administration needs more data in its effort to cut greenhouse gas emissions from its buildings, vehicles, and operations, various White House officials said. Data on emissions reductions, as well as hydrology and energy usage, is needed to both guide federal agencies’ policy choices and make the business case to future administrations that cutting carbon is good for government, the officials said, speaking at a Tuesday conference sponsored by the Business Council for Sustainable Energy.

— House appropriators also advanced their Energy and Water spending bill in a 32-24 vote. Members rejected a series of Republican amendments that serve as an outline of GOP priorities if they take control of the House next year. That includes rejected amendments to require the Energy Department to spur domestic oil and gas production amid rising energy prices; advance stalled water management projects in drought-stricken California; and block the department’s recent natural gas furnace efficiency standards.

— Funding for biobased products. Applications will be accepted until Aug. 31 for a $10 million pilot program to develop biobased products that have a lower carbon footprint and increase the use of renewable agricultural materials. Link for details.

— European Union has agreed to a framework to eliminate carbon emissions from new cars and vans by 2035, effectively closing the chapter on the internal combustion engine. Many automakers are already in the process of switching over to cleaner fleets, but the industry will now face some pressure to accelerate plans. The bloc’s proposal was first raised in July 2021, but with the final endorsement complete, it will be up to members of the European Parliament to get the deal over the finish line.

Some updates to the plan: Environment ministers extended a CO2 exemption granted to so-called “niche” manufacturers - or those producing less than 10,000 vehicles per year — until the end of 2035. Italy, home to Ferrari and Lamborghini, gave up demands for a five-year delay in the EU’s plan for carmakers to clean up their fleet. Meanwhile, alternative technologies like synthetic fuels and plug-in hybrids may be included in the future if they can achieve the complete elimination of greenhouse gas emissions.

— Food distributor US Foods opened a 355,000-square-foot distribution center outside Sacramento to serve as a hub for Northern California. The site will house food service products and fleet maintenance operations. US Foods serves about 250,000 customers across the country. Link for details.

— War and weather are imperiling global food supplies, according to U.S. agriculture officials and executives, as rising food prices drive shortages and protests around the world. The pressures are playing out this year as conflict in Eastern Europe disrupts exports from Ukraine, one of the world’s top crop producers, and drought and poor weather afflict major crop-growing regions. Rising food prices are prompting unrest, as disruptions in the flow of crops from Ukraine compound existing stress on global supplies of grains and other goods. The head of the United Nations World Food Program has warned outright food shortages are possible in 2023 if Russia continues to block Ukraine’s crop exports.

Up to 323 million people worldwide are at risk of starvation due to the pandemic, climate change, global economic woes and warfare including Russia’s invasion of Ukraine, said the leaders of the world’s leading democracies. The Group of Seven committed an additional $4.5 billion on Tuesday “to protect the most vulnerable from hunger and malnutrition.”

The situation is less grim in Asia. Thank rice, the WSJ reports (link). Following successive bumper crops, rice has emerged as a rare food commodity that has generally been cheaper this year than it was last year. That’s great news for the billions of people who live across the swath of Asia where the grain is a popular staple, from India to Thailand, Vietnam and Japan. The region encompassing South, Southeast and East Asia produces and consumes more than 80% of the world’s rice.

— Summary:

• Global Covid-19 cases at 545,487,518 with 6,332,700 deaths.
• U.S. case count is at 87,221,842 with 1,016,766 deaths.
• Johns Hopkins University Coronavirus Resource Center says there have been 592,269,252 doses administered, 221,942,152 have been fully vaccinated, or 67.35% of the U.S. population.

— FDA panel approves recommendation on future Covid vaccines. Future Covid-19 booster shots should include a component targeting the omicron variant, according to a recommendation from the Food and Drug Administration (FDA) vaccine advisory panel. They voted 19-2 in favor of the recommendation. FDA plans to decide on adopting the recommendation in early July and a potential Covid booster campaign is expected to come in October.

— Federal supply of a key Covid-19 drug could run out in August if use continues at its current pace and pandemic funding isn’t renewed, Biden administration officials told Congress. Eli Lilly’s bebtelovimab is the only antibody drug for nonhospitalized patients found to work against Omicron. Republicans say the administration should tap unspent pandemic funds first, and that the federal government should give up its pandemic procurement of many products. Selling the drug commercially would be a first test of whether Covid drugs and vaccines would remain widely accessible if shifted to the commercial market.

— On Tuesday, six states held congressional primary elections, primary runoffs or special elections. Some results:

• Colorado: State Rep. Ron Hanks lost his bid for the GOP’s Senate nomination to Joe O’Dea, a businessman who has repeatedly acknowledged that President Joe Biden legitimately won the 2020 election. O’Dea now figures to give Colorado Democrats what they feared: a competitive general-election contest against Senator Michael Bennet, who has privately told people his race will be difficult.

  Rep. Lauren Boebert, one of Congress’ most polarizing members, easily beat back a challenge from a more mainstream Republican, moderate state Rep. Don Coram, a rancher and hemp farmer.

  In Colorado’s deeply conservative El Paso County, eight-term Republican Rep. Doug Lamborn staved off a challenge from the right from state Rep. Dave Williams for his 5th Congressional District seat.

• Illinois: Darren Bailey, a southern Illinois farmer and state senator endorsed last weekend by former President Donald Trump, was declared the GOP winner by the Associated Press. He will face Democratic Gov. J.B. Pritzker, a billionaire and the nation’s wealthiest elected official, on November’s ballot. Hedge-fund billionaire Ken Griffin lost his $50 million bet in the Illinois Republican primary for governor after the suburban mayor he supported lost to a staunch conservative who benefited from Democratic advertising. The candidate Griffin bankrolled, Aurora, Ill., Mayor Richard Irvin, had trailed in polls going into Tuesday’s final day of voting.

  Republican Rep. Mary Miller won her primary over fellow five-term incumbent Rep. Rodney Davis in a heavily red district in central Illinois that was redrawn after the state’s shrinking population cost it a congressional seat. Davis is the ranking member of the House Transportation and Infrastructure Highways and Transit Subcommittee. Miller voted against certifying Biden’s victory in the 2020 presidential election and is a member of the far-right House Freedom Caucus. Davis was a co-chair of Trump’s 2020 Illinois campaign but voted to certify the 2020 presidential election results. Miller will face Democrat Paul Lange for the seat in this largely conservative district.

  Democratic Rep. Sean Casten beat progressive Rep. Marie Newman for a seat in suburban Chicago. Casten is a two-term congressman who flipped a suburban seat in 2018 that Republicans had held for decades.

  Jonathan Jackson, the son of civil rights leader the Rev. Jesse Jackson, emerged from a crowded field vying to replace 15-term Democratic Rep. Bobby Rush, the only lawmaker who has ever beaten Barack Obama in a race. Obama challenged Rush in a 2000 U.S. House primary and lost. The heavily Democratic 1st Congressional District that Jackson will now run in November to represent was redrawn after the 2020 census and now stretches from Chicago’s South Side to Kankakee.

  In Illinois’ open 17th Congressional District, Esther Joy King won the GOP nomination, while Eric Sorensen, a former meteorologist, won the Democratic nomination. They are vying to replace five-term Democratic Rep. Cheri Bustos, who decided against seeking re-election in the largely rural swath of northwestern Illinois.

• Mississippi: Rep. Michael Guest, a Republican who bucked Trump to vote for an independent Jan. 6 commission, beat back a challenge from an air force pilot. Republican Rep. Steven Palazzo lost in a rare runoff to Sheriff Mike Ezell.
• Nebraska: Republican state Senator Mike Flood won the special election for the Nebraska District 1 congressional seat formerly held by Republican Jeff Fortenberry, who was sentenced to probation on Tuesday for lying to federal agents just as voters picked a replacement for the rest of his term. A judge sentenced him to two years of probation, a $25,000 fine and community service. Flood defeated Democrat Patty Pansing Brooks. Flood, a former speaker of the Nebraska Legislature, will fill the remainder of Fortenberry’s term and is favored to win the general election in November, also against Pansing Brooks.
• New York: Gov. Kathy Hochul fended off two challengers. Her late-in-the-game lieutenant governor, Antonio Delgado, also coasted. Republicans nominated U.S. Rep. Lee Zeldin to challenge Hochul in November. The Long Island representative was among the Republicans in Congress who voted against certifying the 2020 election results.

• Oklahoma: Sen. James Lankford easily defeated a GOP primary challenge from an evangelical pastor who complained he hadn’t echoed Trump’s election comments.

  Rep. Markwayne Mullin and T.W. Shannon are headed for an Aug. 23 Republican runoff in the Oklahoma Senate special election after emerging as the top two vote recipients in Tuesday’s primary. Given the partisan lean of the state, whoever wins the Republican nomination is likely to win the November general election for the seat of Sen. Jim Inhofe (R), who’s resigning two years into his term after holding the seat since a 1994 special election. The nominee will face former Rep. Kendra Horn, who was unopposed for the Democratic nomination.

— A divided U.S. Supreme Court reinstated a Republican-drawn congressional map in Louisiana for this year’s election, blocking a trial judge’s order that required a second majority-Black voting district. Over the dissents of the three liberal justices, the court granted state officials’ request for intervention on an emergency basis. U.S. District Judge Shelly Dick had said the Voting Rights Act required a second majority-Black district in Louisiana for the House.

— Remembering: On this day in 1956, President Dwight D. Eisenhower, spurred on by memories of how easy it was for Allied troops to move along Germany’s autobahns in 1945, and how difficult it had been for an army convoy to cross the U.S. in 1919, signed the Federal-Aid Highway Act, creating the Interstate Highway System.