The daily business briefing: March 20, 2018
Stocks weighed down by Facebook data-privacy fallout, Uber halts autonomous vehicle testing after fatal accident, and more
Stocks dragged down by Facebook data-privacy fallout
U.S. stocks dropped sharply on Monday as Facebook led a selloff of technology shares. Facebook's stock fell by 7.1 percent as its CEO, Mark Zuckerberg, faced calls from lawmakers to explain how a data firm linked to President Trump's campaign got access to information on 50 million Facebook users. Facebook shares finished the day down 13 percent from a record high reached on Feb. 1. Other major tech stocks also fell on rising speculation of tighter regulation in the tech sector. The Dow Jones Industrial Average lost 1.8 percent, and the S&P 500 dropped 1.9 percent. The tech-heavy Nasdaq Composite fell by 2.5 percent. Facebook shares and Nasdaq-100 futures slid further early Tuesday ahead of the start of the Federal Reserve's two-day policy meeting.
Uber suspends autonomous vehicle tests after fatal accident
Uber halted testing of autonomous vehicles on Monday after one of the cars struck and killed a woman in Tempe, Arizona. The woman, Elaine Herzberg, was crossing a street outside a crosswalk when she was hit by the Uber vehicle, which had a human safety driver but was operating in autonomous mode, local police said. Herzberg, 49, was taken to a nearby hospital, where she died. "We're thinking of the victim's family as we work with local law enforcement to understand what happened," Uber CEO Dara Khosrowshahi tweeted. Uber and rival companies such as Alphabet and General Motors are investing billions in driverless technology. The Tempe accident was believed to be the first fatality involving one of the cars. The National Highway Traffic Safety Administration sent a team to investigate.
NYC councilman starts investigation of Kushner Cos.
New York City Councilman Ritchie Torres, chair of the city council's investigations committee, launched an inquiry on Monday into the Kushner Cos. routine filing of false paperwork claiming its buildings had no tenants in rent-regulated apartments. Torres said somebody should have spotted the false numbers earlier because the documents were available publicly online. The Associated Press reported Sunday that a watchdog group had found more than 80 Kushner Cos. construction permit applications for 34 buildings between 2013 and 2016 stating the company — the family business of President Trump's son-in-law and senior adviser Jared Kushner — had no rent-regulated apartments, when it really had more than 300. The false claim let the company kick out low-paying tenants and raise rents on new ones.
KB Toys eyes comeback as Toys 'R' Us shuts down
KB Toys, a toy-store chain that shut down in 2009, is considering launching a comeback bid as former rival Toys "R" Us prepares to liquidate and close all 735 of its U.S. stores. Ellia Kassoff, the founder of Strategic Marks LLC, said the company has "spent the last six months working on a sustainable model to bring back KB Toys the right way." He said KB Toys, which once had more than 1,000 stores, has to factor in the reality of competition from online retailers and big-box stores. Toys "R" Us reportedly has considered keeping open some of its strongest stores and its Canadian operations. It has a hearing scheduled in bankruptcy court on Tuesday.
Weinstein Company files for bankruptcy
The Weinstein Company said Monday it had filed for bankruptcy protection as it struggles to deal with the ongoing fallout over the scandal of sexual harassment and assault allegations against its once powerful former chairman, Harvey Weinstein. The collapsing film studio also announced that it was ending non-disclosure agreements that have silenced accusers. The company listed $500 million to $1 billion in liabilities and the same amount in assets in the documents filed with the Delaware court. It said it had struck a deal to sell its assets to an affiliate of private equity firm Lantern Capital Partners.