The daily business briefing: April 3, 2018
Stocks dive as trade tensions with China escalate, the EPA starts rolling back Obama-era fuel economy standards, and more
Stocks dive as trade tensions with China escalate
U.S. stocks plunged on Monday as fears of a trade war intensified after China imposed tariffs on $3 billion in U.S. farm goods and other imports, and technology shares continued to stumble. Amazon sank further after President Trump unleashed a flurry of fresh attacks on the online retail giant via Twitter, and the threat of tightening regulations on the tech sector scared off investors. The Dow Jones Industrial Average fell by as much as 758 points before clawing back a bit to close down by 459 points or 1.9 percent. The S&P 500 fell by 2.2 percent and the tech-heavy Nasdaq dropped by 2.7 percent. U.S. stock futures steadied early Tuesday, edging higher.
EPA moves to ditch Obama-era fuel economy standards
President Trump's Environmental Protection Agency on Monday officially started the process of reversing tighter Obama-era automobile fuel economy standards. The EPA is moving to roll back standards that were intended to reduce greenhouse gas emissions in 2022 to 2025 model year cars and light trucks. The Obama administration imposed the standards in 2012, but the EPA said Monday that they are "not appropriate and should be revised." Early in his presidency, Trump called the standards "out of control." The Obama administration called for automakers to produce fleets with an average fuel efficiency of 54.5 miles per gallon, nearly double where they were at the time. The EPA now says a drop in oil prices resulted in a decline in smaller, more fuel-efficient cars, making the Obama-era standards unreasonable.
Sinclair executive defends broadcaster against criticism of anti-fake news promos
Sinclair Broadcasting's senior vice president of news, Scott Livingston, on Monday pushed back against people who criticized the company's ad campaign against "fake news." Sinclair had its stations' news anchors read promos, which critics said sounded like pro-Trump propaganda. Livingston said in an internal memo that the campaign targets "fake/false" stories "like 'Pope Endorses Trump,'" which go viral and "result in an ill-informed public." Some bogus stories like the "Pizzagate" hoax "can result in dangerous consequences," he wrote. Livingston referred to a new Monmouth University poll in which 77 percent of respondents said mainstream media sometimes reports "fake news." President Trump tweeted that it was "so funny to watch Fake News Networks" criticize Sinclair as biased, because Sinclair is "far superior to CNN."
Spotify shares make their market debut
Spotify's stock makes its debut on Tuesday in a critical test for the Swedish company that grabbed an early lead in the market for music streaming services. Spotify has 71 million subscribers worldwide, and aims to reach 96 million subscribers by the end of the year, far ahead of Apple's 38 million subscribers for its three-year-old music streaming service. That early advantage has drawn comparisons to the head start Netflix had in video streaming when it made its initial public offering of stock in 2002. A $10,000 investment in Netflix's IPO would be worth $2.6 million or so today.
Fox offers to sell Sky News to Disney to win over British regulators
21st Century Fox Inc. said Tuesday that it would be willing to sell Sky News to Walt Disney Co. in its latest attempt to get British regulators to approve its $16.5 billion bid to complete its takeover of European pay-TV operator Sky PLC. The move would legally separate Sky News from the rest of Sky, potentially alleviating concerns that Fox's takeover would give media mogul Rupert Murdoch — whose News Corp. owns The Times, The Sunday Times, and The Sun newspapers — too much media power in the U.K. Fox is trying to buy the 61 percent of Sky it doesn't already own. Disney is trying to take over most of Fox for $52.4 billion, and reportedly wants to buy Sky News regardless of whether that deal goes through.