The daily business briefing: October 28, 2016
Bonds continue their worst month since 2014, Twitter dumps Vine, and more
Bond troubles deepen
Global stocks struggled on Friday as bonds continued their worst month since 2014 ahead of the release of quarterly data on U.S. economic growth. U.S. Treasury 10-year note yields climbed to their highest since May as expectations grow for the Federal Reserve to raise interest rates in December. U.S. stocks appeared headed for a cautious open on Friday after mixed messages from powerhouses Amazon and Google. Amazon's disappointing earnings report was countered by Google-parent Alphabet, which reported stronger-than-expected earnings after trading ended Thursday. Google shares rose by 1.1 percent before the bell.
Toyota invests in car-sharing startup
Toyota said Friday that it had invested in U.S. car-sharing company Getaround, a San Francisco-based startup. The move came as automakers and technology companies have been joining forces to compete in a race to combine car sharing services with self-driving cars. Japan's Nikkei newspaper reported that Toyota's investment fund, Mirai Creation Investment Limited Partnership, had put about $10 million into Getaround. The startup has been operating its on-demand car-sharing service in San Francisco, Chicago, Washington, D.C., and other cities since 2013, and has more than 200,000 members.
Amazon ends streak of record profits
Amazon shares dropped by nearly 5 percent in after-hours trading after the online retail giant posted a smaller-than-expected increase in third-quarter profit, ending a three-quarter streak of record profits. Amazon said its shipping costs had surged, rising by 43 percent to $3.9 billion, as the company started building the base of its own shipping operation to boost its delivery capacity over the crucial holiday shopping season.
Twitter abandons Vine app
Twitter announced Thursday that it will be discontinuing the mobile app for Vine, a short-form video-sharing service that has existed since 2013. The announcement follows reports earlier Thursday that Twitter would be reducing its global workforce by 9 percent, even as the troubled company's third-quarter earnings exceeded analysts' expectations. "Nothing is happening to the apps, website, or your Vines today," the company said in a statement. "We value you, your Vines, and are going to do this the right way. You'll be able to access and download your Vines." Vine has over 200 million monthly users and 1.5 billion "loops."
Justice Department busts call centers for alleged scam
The Justice Department on Thursday charged 61 people and businesses with participating in a scam involving India-based call centers where workers impersonated Internal Revenue Service, immigration, and other U.S. officials, demanding payments for phony debts. Starting in 2013, the operation tricked at least 15,000 people into paying a total exceeding $300 million. Twenty of the suspects were arrested in the U.S. Thirty-two people and five call centers in India also have been charged. "It's really important for the scammers in India to know that the United States is looking at this, is watching them and they could, if they engage in that activity, be extradited to the United Sates and could sit in jail ... for several years," U.S. Assistant Attorney General Leslie Caldwell said.