The daily business briefing: December 19, 2017
Stocks set to add to tax-cut-fueled gains, ESPN President John Skipper resigns, and more
Stocks set to add to gains, fueled by anticipation of tax cuts
U.S. stock futures gained early Tuesday in an ongoing boost from expectations of big tax cuts. Futures for the Dow Jones Industrial Average rose by 0.2 percent, while futures for the S&P 500 and Nasdaq-100 gained 0.1 percent. All three of the main U.S. benchmark indexes closed at records on Monday, fueled by confidence that Republicans would pass their tax plan by Christmas as promised. The plan includes big tax cuts for corporations and the richest Americans, with smaller reductions and murkier impact on most others. "Unsurprisingly investors have ignored the nuances of the Republican tax 'reforms' — especially the impact it will have on the American middle class — to instead revel in what it means for the nation’s mega-corporations and millionaires," said Connor Campbell, financial analyst at Spreadex, in a note.
ESPN President John Skipper abruptly resigns, citing 'substance addiction'
ESPN President John Skipper unexpectedly announced his resignation on Monday, citing a "substance addiction" that had lasted for years. "I come to this public disclosure with embarrassment, trepidation, and a feeling of having let others I care about down," he said. Skipper became president of the sports network, a division of the Walt Disney Company, in 2012, and recently signed a contract extension through 2021. He remained visible in his role through last week. He did not specify what substance he had been abusing. The news took other ESPN executives and on-air personalities by surprise. "This person has created everything that exists here at ESPN for us," Dan Le Batard said on his radio show.
GOP makes final push to pass tax overhaul
Republicans launch the final push to pass their tax overhaul on Tuesday with a vote in the House. The Senate is expected to follow by late Tuesday or Wednesday, with both votes expected to be along party lines. With a narrow 52-48 GOP majority in the Senate, the plan, which includes big tax cuts for corporations and the wealthiest Americans, appeared to be headed for trouble, but last-minute negotiations won over holdouts, including Sens. Marco Rubio (R-Fla.), Bob Corker (R-Tenn.), Susan Collins (R-Maine), and Mike Lee (R-Utah). The legislation is the biggest reworking of the federal tax code in three decades. It permanently cuts the tax rate for corporations from 35 percent to 21 percent and reduces the top rate for the wealthy, with more modest reductions for others. The legislation also adds $1.46 trillion to deficits over a decade.
Campbell Soup and Hershey buy healthy-snack makers to boost sales
Campbell Soup Co. and Hershey Co. on Monday announced plans to buy healthy-snack makers in the latest shifts by big food companies into more nutritious foods. Campbell is trying to boost sagging sales by purchasing Cape Cod chips-maker Snyder's-Lance, which owns brands such as Eatsmart veggie snacks, for $4.87 billion. Hershey is buying Amplify Snack Brands, maker of SkinnyPop popcorn and Paqui tortilla chips, for $921 million. Both of the companies being acquired boast that most of their products use no artificial ingredients or transfats. Snyder-Lance and Amplify shares had risen in recent sessions as expectations of the deals bubbled up, and both stocks gained nearly 7 percent more on Monday. Shares of Campbell and Hershey inched up on Monday.
Trump administration blames North Korea for 'WannaCry' cyberattack
The Trump administration has publicly blamed North Korea for the so-called WannaCry cyberattack that targeted major corporations, hospitals, and other institutions around the world last year. In an op-ed published in The Wall Street Journal on Monday night, President Trump's Homeland Security Adviser Tom Bossert said the attack was "widespread and cost billions, and North Korea is directly responsible. North Korea has acted especially badly, largely unchecked, for more than a decade, and its malicious behavior is growing more egregious. WannaCry was indiscriminately reckless." The announcement is seen as an attempt to hold North Korea publicly accountable as its hacking and nuclear weapons capabilities pose a rising threat to the U.S. and its allies.