The daily business briefing: January 6, 2017
Job growth slows in December but wages rise, Toyota shares drop as Trump threatens a border tax, and more
Economy adds fewer jobs than expected in December, but wages rise
U.S. non-farm employers added 156,000 jobs in December, the Labor Department said Friday in the last monthly employment report of the Obama administration. The number fell below expectations — economists polled by MarketWatch had forecast 180,000 new jobs — and the average growth for the previous 11 months, but rounded out the sixth straight year of employment gains of more than 2 million jobs. The unemployment rate edged up to 4.7 percent from 4.6 percent. Average hourly wages rose by 0.4 percent, slightly more than expected. That pushed year-to-year wage gains to 2.9 percent, the biggest jump since the end of the recession in 2009.
Trump threatens Toyota with border tax on cars built in Mexico
President-elect Donald Trump on Thursday targeted Toyota with threats similar to those he has made against U.S. companies, telling the Japanese automaker with heavy fees if it builds small cars in Mexico to be sold in the U.S. "Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax," Trump said via Twitter. The attacks have stirred fears for the future of cross-border production networks crucial to more than $583 billion in annual trade between the two countries. The tensions have dragged down the value of the Mexican peso. Toyota shares dropped by about 3 percent early Friday.
Report: Trump to ask Congress, not Mexico, to pay for border wall
President-elect Donald Trump's transition team has let congressional Republican leaders know that Trump plans to ask Congress to provide money to start building the border wall he promised to erect between the U.S. and Mexico, The Associated Press and CNN reported. Trump reportedly prefers to fund the project that way, instead of making Mexico pay for it, as he repeatedly vowed during the campaign, because it would let him go through the appropriations under a 2006 law to build border fencing. That way, he would avoid having to push through a new border-wall bill that probably would face strong opposition from Democrats and some Republicans. On Friday, Trump tweeted that "any money spent on building the Great Wall (for sake of speed), will be paid back by Mexico later!"
China prepares for possibility of trade war with U.S.
China is prepared to retaliate if President-elect Donald Trump starts a fight over trade, people familiar with the matter told Bloomberg. Trump has accused China of manipulating its currency, and he has touted protectionist policies. China says if Trump acts first, taking punitive measures against Chinese goods, Beijing might subject big U.S. companies to tax and antitrust investigations, according to the sources. It also might launch anti-dumping investigations, and cut government purchases of U.S. goods. China, however, has a lot to lose due to its big trade surplus with the U.S.
Gap reports unexpected sales surge
Gap shares surged by more than 8 percent in pre-market trading on Friday after the clothing retailer reported an unexpectedly strong surge in holiday sales. Comparable sales for December rose by 4 percent, thanks largely to improvement in the company's Gap and Old Navy clothing lines. Analysts had expected a 0.7 percent drop. The jump reversed a string of declines. Gap also helped its bottom line by shutting stores and reducing overhead costs. The company said it expected full-year 2016 adjusted profit to be just above its previously forecast range.