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The daily business briefing: September 5, 2018

Harold Maass
David McNew/Getty Images
The daily business briefing newsletter
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1.

Amazon's value hits $1 trillion

Amazon shares gained on Tuesday, briefly making the surging e-commerce giant the second publicly listed U.S. company to reach a market capitalization of $1 trillion. The stock closed up 1.3 percent. Apple reached the landmark on Aug. 2. It took the iPhone maker nearly 38 years to get there; Amazon made it in 21 years. Amazon has made investors happy by diversifying into new retail areas, and building customer engagement through smart speakers and its Prime service. "It says a lot about Amazon and its ever-increasing dominance of segments of the retailing world as well as the web services business," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. "They have a tiny share of the worldwide retail sales market so there's a lot left to capture there." [Reuters]

2.

Facebook and Twitter leaders to testify on response to disinformation

Facebook and Twitter executives head to Capitol Hill on Wednesday to testify about how their companies responded to foreign efforts to influence U.S. elections. According to written testimony, Facebook's chief operating officer, Sheryl Sandberg, and Twitter CEO Jack Dorsey plan to take an apologetic approach but also talk about their companies' mounting efforts to stem orchestrated outside attempts to spread disinformation and otherwise manipulate social media users. "The actions we've taken in response ... show our determination to do everything we can to stop this kind of interference from happening," Sandberg said in written testimony. Sandberg and Dorsey will appear before the Senate Intelligence Committee in the morning. Google declined an invitation sent to Larry Page, CEO of Google parent Alphabet. [The New York Times]

3.

Toyota recalls 1 million vehicles over fire concern

Toyota is recalling more than one million Prius and C-HR crossover sport-utility vehicles globally due to fire risk. Most of the vehicles were sold in Japan, but the recall covers about 192,000 Prius and Prius Prime vehicles in the U.S. The recall affects some 2016-2018 Prius vehicles, Prius Prime plug-in hybrids, and a hybrid gas-electric C-HR that is not sold in the U.S. The problem, caused by issues at plants in Japan, could arise when wires leading to the hybrid power-control unit are subjected to wear that could result in a short. Toyota plans to repair part of the electrical system that could cause the fires. [MarketWatch]

4.

JPMorgan Chase settles potential race discrimination suit

JPMorgan Chase has agreed to pay $24 million to settle a potential lawsuit from six financial advisers who say the nation's largest bank mistreated them because they are black. The plaintiffs said they faced "systemic, intentional race discrimination" that resulted in lower pay and less lucrative opportunities for black financial advisers. To avoid a class-action lawsuit, JPMorgan Chase will pay $19.5 million to more than 250 current and former employees, and create a $4.5 million fund to support anti-bias training, as well as recruitment and mentoring of African-American employees. Suzanne Bish, the plaintiffs' lawyer, said her clients were "pleased that Chase was willing to work with them — not only to provide monetary relief, but to provide policies to level the playing field for employees." [Bloomberg, CNN]

5.

Blood-testing startup Theranos to close

Scandal-plagued blood-testing company Theranos Inc. is shutting down for good, The Wall Street Journal reported Tuesday, citing an email from CEO David Taylor to shareholders. Taylor said Theranos had reached out through an investment bank to dozens of potential buyers but none were interested. "We are now out of time," Taylor wrote. The biotech company was once one of the hottest startups in Silicon Valley, with its value going as high as $9 billion as it promised a cheaper alternative to traditional medical tests. The company unraveled after it had to void two years of blood tests. Its founder and former CEO, Elizabeth Holmes, and former COO and president, Ramesh "Sunny" Balwani, now face charges for an alleged multimillion dollar scheme to defraud investors, as well as doctors and patients. Both have pleaded not guilty. [The Wall Street Journal, CNN]