The daily business briefing: October 4, 2016

Chicago pulls $25 million from Wells Fargo, the British pound falls to a 31-year low, and more

The British pound in paper and coins
(Image credit: PAUL ELLIS/AFP/Getty Images)

1. Chicago yanks $25 million from Wells Fargo over sales scandal

The city of Chicago on Monday said it would divest $25 million it has invested with Wells Fargo & Co. due to the bank's sales scandal. Wells Fargo has admitted that its workers, many hoping to meet sales targets, opened two million bank and credit card accounts without customers' knowledge. The office of Chicago Treasurer Kurt Summers, which manages the city's $7 billion investment portfolio, said in a statement that the city would "unwind these assets as expeditious as possible in a fashion that is prudent and will protect taxpayer money." Illinois state officials already have yanked bond business from Wells Fargo. A spokesman for the bank said it was "very sorry" and working to "rebuild the city's trust."


2. British pound falls to three decade low on Brexit concerns

Britain's pound fell to a 31-year low against the dollar on Tuesday as fresh Brexit concerns bubbled up, and the dollar gained ground on renewed expectations of an interest rate hike. The pound traded as low as $1.2737, down from $1.2858 late Monday in New York, falling after Prime Minister Theresa May indicated her government will focus on sovereignty and immigration in negotiations to leave the European Union, suggesting it will leave the E.U.'s single market. "It is now abundantly clear that access to the single market is not on Theresa May's list of top priorities and the market is realizing that," said UniCredit's Global head of FX strategy, Vasileios Gkionakis.

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Reuters MarketWatch

3. New York orders the Trump Foundation to stop fundraising

The office of New York Attorney General Eric Schneiderman (D) has told Donald Trump that his charitable foundation is violating state law, and ordered the foundation to stop soliciting donations immediately because it lacks proper state certification. James Sheehan, head of the attorney general's charities bureau, said the violation notice went out on Friday. Trump, the Republican presidential nominee, started the Donald J. Trump Foundation to distribute proceeds from the sales of his book, The Art of the Deal, but since 2008 it has been funded by outside donations. By failing to get certified, it avoided rigorous outside audits the state requires for large charities.

The Washington Post

4. U.S. factory output picks up

U.S. factories increased their activity in September, recovering from a one-month contraction in August, the Institute for Supply Management said on Monday. The ISM's index of national factory activity rose to 51.5 from 49.4 in August, beating analysts' expectations. Anything above 50 indicates expansion in factory output, which was a weak spot for the economy early this year. "This is a relief," said Ian Shepherdson, an economist at Pantheon Macroeconomics.


5. Bass Pro Shops reaches deal to buy Cabela's

Bass Pro Shops has reached a deal to acquire rival Cabela's for $4.5 billion in cash, the two companies said Monday. Cabela's has long been concentrated in the West, and Bass Pro Shops in the East. The merger will create a national chain with more than 180 stores and a 20 percent share of the $50 billion market for hunting, camping, and fishing gear. The deal comes following recent cost-cutting and restructuring by Cabela's, which has seen its sales lag partly due to competition from online competitors and general retailers, such as Walmart.

The Wall Street Journal USA Today

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Harold Maass

Harold Maass is a contributing editor at He has been writing for The Week since the 2001 launch of the U.S. print edition. Harold has worked for a variety of news outlets, including The Miami Herald, Fox News, and ABC News. For several years, he wrote a daily round-up of financial news for The Week and Yahoo Finance. He lives in North Carolina with his wife and two sons.