The daily business briefing: January 18, 2018
The Dow closes above 26,000 in a historic first, Apple decides to use a new tax break to repatriate billions, and more
Dow closes above 26,000 for first time
The Dow Jones Industrial Average jumped by 323 points or 1.3 percent on Wednesday to close above 26,000, marking a historic first for the blue-chip index. The Dow pierced the 26,000-point threshold for the first time on Tuesday before giving back its gains and closing just below it. The other major equity indexes, the S&P 500 and the Nasdaq Composite, also closed at record highs. The Dow's gains were spurred by quarterly results from some of the biggest U.S. companies that exceeded Wall Street's expectations. "You've got a bullish start to the earnings season and earnings are expected to be strong for 2018," said Adam Sarhan, CEO of 50 Park Investments. U.S. stock futures were flat early Thursday.
Apple to take advantage of tax break to repatriate overseas cash
Apple on Wednesday revealed plans to bring back most of the $252 billion in cash it has been holding overseas. The company is taking advantage of a one-time tax break offered under the Republican tax overhaul signed into law last month by President Trump. Apple said it would pay $38 billion in taxes, and use some of the repatriated cash to create 20,000 jobs, build a new domestic campus, and make other investments. "I promised that my policies would allow companies like Apple to bring massive amounts of money back to the United States," Trump tweeted. "Great to see Apple follow through as a result of TAX CUTS."
Cryptocurrency plunge reduces value of Ripple co-founder's holdings by $44 billion
The spectacular cryptocurrency crash continued on Wednesday. It's not just Bitcoin that is falling, although the largest digital currency dropped below $10,000, less than half its peak value. Ripple's XRP coin has dropped by 74 percent since hitting its record high of $3.84 on Jan. 4. The plunge has shrunk the holdings of Chris Larsen, co-founder and executive chairman of Ripple, by $44 billion. Larsen's holdings are now worth about $15.8 billion, down from a peak of $59.9 billion that briefly made him one of the five richest people in the U.S.
Brexit bill clears hurdle in House of Commons
The British government's Brexit bill cleared its next big hurdle on Wednesday when it was approved by the House of Commons in a 324 to 295 vote. The measure now faces tough scrutiny in Parliament's unelected upper chamber, the House of Lords, where the government lacks a majority and many members favor staying in the European Union. The government suffered an embarrassing setback last month when 11 rebel conservative members of Parliament voted against the Conservative government to give lawmakers a say on the final Brexit terms. Since that defeat, the government and the EU have agreed to move on to talks on a transitional deal before hammering out post-Brexit trade and security arrangements.
Emirates agrees to $16 billion deal Airbus needed to keep making A380 jets
The Middle East's largest airline, Emirates, announced Thursday that it had agreed to buy 20 A380 aircraft from Airbus with an option to buy another 16 of the double-decker superjumbo jets. The deal is worth $16 billion. The announcement came just days after Airbus chief salesmen warned that the company would have to shut down production of the A380 if it couldn't get a long-term commitment from Emirates, which has 101 of the jets and another 41 on order, making it the largest operator of the A380. "This order will provide stability to the A380 production line," Emirates Chairman and Chief Executive Sheikh Ahmed bin Saeed Al Maktoum said.