The daily business briefing: August 14, 2017
China bans iron, lead, and coal imports from North Korea, Trump administration launches NAFTA renegotiations, and more
China bans imports of North Korean iron, lead, and coal
China on Monday announced a ban on iron ore, iron, lead, and coal imports from North Korea, a potentially devastating blow to North Korea's economy. The move marked an important step by Beijing toward implementing United Nations Security Council sanctions aiming to punish Pyongyang for defying calls to curb its nuclear weapons and missile programs. At the same time, China warned the Trump administration not to start a trade war with Beijing and split the international coalition against North Korea. On Monday, President Trump is returning briefly to Washington from his golf course in Bedminster, New Jersey, to sign an executive order launching a study on a potential investigation of China's trade practices relating to technology and intellectual property, White House aides said over the weekend.
Trump administration launches NAFTA renegotiations
The Trump administration launches renegotiations of the 23-year-old NAFTA trade pact this week, aiming to shrink the growing U.S. trade deficit with Mexico and tightening rules on imports of cars and parts. President Trump has blamed the North American Free Trade Agreement for pushing automobile factories and jobs out of the U.S. and into Mexico, where wages are lower. The U.S. had a $74 billion trade deficit with Mexico in cars and parts last year, larger than the overall deficit of $64 billion. "The Trump administration has framed their NAFTA negotiating objectives around reducing the trade deficit with Mexico," said Caroline Freund, a senior trade fellow at the Peterson Institute for International Economics. "If they don't touch autos, there's no way of getting at what they want."
Stock futures gain as North Korea fears ease
Global stocks gained on Monday as fears over North Korea eased. U.S. stock futures rose, with Dow Jones Industrial Average futures gaining as much as 106 points in a sign of recovery after last week's 234-point fall for the blue-chip index. Stocks had their worst losses of 2017 last week as tensions escalated over North Korea's nuclear weapon and missile programs, with Pyongyang threatening to fire missiles into waters near the Pacific U.S. territory of Guam. "The markets have opened with an eerie note of calm at the start of a fresh week," said Kathleen Brooks, a London-based research director at City Index, in emailed comments Monday. "The U.S.-North Korea tensions stalled over the weekend as President Trump dealt with more pressing matters of domestic terrorism."
Bitcoin breaks $4,000 barrier
The price of bitcoin broke $4,000 for the first time on Sunday, reaching a record high of $4,056.80 and remaining above the symbolic threshold early Monday. Iqbal V. Gandham of trading platform eToro called the mark "another milestone in a long list of big moments the cryptocurrency has witnessed in recent weeks" after a fall to $1,800. "Furthermore, the ecosystem is also getting stronger. You now have more places to spend Bitcoin, more regulators thinking about the right infrastructure, and more investors learning about the asset." Bitcoin has gained by more than 300 percent so far this year.
Shonda Rhimes signs deal to leave ABC for Netflix
Shonda Rhimes, creator of a string of hits including Grey's Anatomy, Scandal, and How to Get Away with Murder, has signed an exclusive deal with Netflix, the streaming video company announced Monday. Rhimes' move marked a major setback for Disney and ABC, which broadcast a string of Rhimes hits. The deal came shortly after Disney landed a blow against Netflix last week by announcing it would stop letting Netflix stream its new movies, and even make it yank some old Disney and Pixar movies, and launch its own streaming services.