The daily business briefing: January 5, 2017
Strong December sales give U.S. automakers a record year, Macy's announces job cuts and store closures, and more
December sales push automakers to record year
U.S. automaker shares surged on Wednesday following reports that aggressive December dealmaking helped lift total sales to a record 17.55 million cars and light trucks in 2016. The monthly annualized sales rate shot to 18.4 million in December, the fastest pace since July 2005. At the start of the month the industry was nearly on pace to beat 2015's record of 17.47 million vehicles. The 2016 high point marks the eighth consecutive full-year increase following the Great Recession, which nearly wiped out General Motors and Chrysler. GM shares rose by 5.5 percent and Ford gained 4.6 percent. Even Fiat Chrysler, the only major automaker to post lower December sales, gained 1.4 percent.
Macy's to cut 10,000 jobs after disappointing holiday sales
Macy's shares plunged by more than 9 percent following Wednesday's release of disappointing holiday sales results as brick-and-mortar retailers continued to lose ground to online rivals. Macy's said it was cutting 3,900 jobs with the closing of 68 stores, leaving it with about 660 still open in the U.S. It will further reduce costs by cutting layers of management, bringing its total job cuts to more than 10,000. Struggling retailer Sears also revealed details of its efforts to cut unprofitable stores, increasing the number of Kmart and Sears stores it plans to close in early 2017 to 150, 10 percent of its store base.
Trump picks Wall Street lawyer to head SEC
President-elect Donald Trump announced Wednesday that he had picked Wall Street lawyer Jay Clayton to head the Securities and Exchange Commission. Clayton joins a growing number of Wall Street insiders Trump has tapped for key financial positions in his administration. The job would put Clayton in the position of policing huge financial institutions he has represented, including Goldman Sachs and Barclays. He also would be one of the people responsible for carrying out Trump's promise to dismantle 2010's Dodd-Frank financial reform law. Trump said Clayton would "ensure our financial institutions can thrive and create jobs while playing by the rules at the same time."
Stocks get a boost from strong China data
World stocks surged to their highest level since mid-2015 on Thursday, lifted by strong data from China that boosted optimism about global economic growth. A private sector survey showed that China's services sector sped up in December, hitting a 17-month high. Also, Federal Reserve minutes from December showed that Fed policy makers expect President-elect Donald Trump's policies, which include tax and regulations cuts as well as big infrastructure spending, could lead to somewhat stronger economic growth, but not a boom, partly because the Fed would speed up the pace of interest rate hikes if growth really speeds up. U.S. stock futures were flat ahead of the opening bell Thursday as investors showed caution ahead of Friday's December jobs report.
Apple pulls Times app in China at government's request
Apple has removed The New York Times app from its app store in China. The move, made last month, was necessary to comply with a request from Chinese authorities. "We have been informed that the app is in violation of local regulations," said Fred Sainz, an Apple spokesman. China started blocking Times websites in 2012 after a series of articles on the wealth amassed by the family of then-prime minister Wen Jiabao, but readers still could access the Chinese-language app. The move is part of China's "wider attempt to prevent readers in China from accessing independent news coverage by The New York Times," said Eileen Murphy, a Times spokeswoman in New York.