The daily business briefing: June 10, 2021
Developer cancels Keystone XL pipeline project, Biden replaces Trump's order on TikTok ban, and more
Developer drops plan for Keystone XL pipeline
Keystone XL pipeline developer TC Energy announced Wednesday that it was scrapping the controversial project, which was intended to carry oil from Canadian tar sands to refineries on the U.S. Gulf Coast. The Canadian company's decision to bail out came after the Biden administration revoked the Keystone XL permit in January. TC Energy said it would coordinate with regulators, stakeholders, and Indigenous groups to safely unwind the project. Biden pulled the permit on his first day in office, and TC Energy warned at the time that the decision would "directly lead to the layoff of thousands of union workers." Environmentalists applauded the decision, and called for ending other fossil-fuel projects.
Biden replaces Trump-era order on TikTok ban
President Biden on Wednesday rescinded an executive order issued by his predecessor, Donald Trump, that sought to ban the popular Chinese-owned TikTok and WeChat apps. Biden is replacing the Trump-era order with one demanding a broader review of apps that are controlled by foreign companies and could pose a potential security risk. Administration officials said on a call with reporters that Trump's order wasn't executed "in the soundest fashion," and Biden's replacement would spell out "clear intelligible criteria" for assessing any national security threats posed by software linked to foreign governments. Trump's administration tried to ban TikTok and force its owner, China's ByteDance, to sell the short-video sharing app, but the app remains available and the case is tied up in court.
El Salvador becomes 1st country to make bitcoin legal tender
El Salvador lawmakers on Wednesday approved President Nayib Bukele's Bitcoin Law, making the Central American nation the first in the world to make the cryptocurrency legal tender. In addition to the U.S. dollar, El Salvadorians now will be able to use the cryptocurrency to pay for goods and services, send money from abroad, and pay taxes. The bitcoin exchange rate will be freely established by the market. The Bitcoin Law says the state will provide necessary training to help the population — 70 percent of which does not have access to traditional financial services — use bitcoin. Bukele said the law would "generate jobs and help provide financial inclusion to thousands outside the formal economy." Bitcoin surged after the vote, rising by more than 13 percent to more than $37,000 before slipping back to $36,435.96 early Thursday, according to CoinDesk.
JBS paid hackers $11 million
JBS, the world's largest meat supplier, announced on Wednesday that it paid $11 million in ransom to hackers late last week to ensure that none of the company's data was stolen. The decision came after consultations with the Brazilian company's tech team and outside cybersecurity experts. "It was very painful to pay the criminals, but we did the right thing for our customers," JBS USA CEO Andre Nogueira told The Wall Street Journal. Nogueira learned that JBS was the target of a cyberattack on May 30, when hackers demanded the company pay a ransom to reclaim access to its computer system. JBS temporarily suspended operations at nine of its beef processing plants in the United States to slow down the attack.
Stocks mixed ahead of inflation data
U.S. stock futures were mixed early Thursday ahead of the release of the latest data on how the economic recovery from the coronavirus pandemic is affecting consumer prices. Futures for the Dow Jones Industrial Average were up by 0.2 percent and those tied to the S&P 500 were up by less than 0.1 percent several hours before the opening bell. Nasdaq futures were down by 0.2 percent. The S&P 500 has been hovering just below a record high in recent weeks, as investors expressed concerns that rising inflation could prompt the Federal Reserve to dial back its efforts to boost the recovery to keep the economy from overheating. Some analysts said it was too early to worry that the Fed will raise interest rates. "We believe the easy money policies of the Fed will last for some time," wrote Scott Wren, senior global market strategist at Wells Fargo Investment Institute.