The daily business briefing: July 20, 2018
Trump breaks with tradition and slams Fed rate hikes, Comcast drops its bid for 21st Century Fox, and more


1. Trump criticizes Fed rate hikes
President Trump on Thursday said he was "not thrilled" with the Federal Reserve's decision to raise interest rates twice so far this year. The Fed, led by Trump appointee Chairman Jerome Powell, also plans to hike rates further as employment and inflation data improve. "I am not happy about it," Trump told CNBC's Joe Kernen in an interview. Trump said the hikes put the U.S. at a disadvantage, because other central banks weren't raising rates. Critics said the rare presidential weigh-in violated the tradition of Fed independence. News of Trump's comments was followed by declines for U.S. stocks, the dollar, and federal bond yields. The White House said Trump was not trying to interfere in Fed decisions.
2. Comcast drops bid for 21st Century Fox, clearing way for Disney
Comcast has dropped its bid to buy 21st Century Fox, leaving Disney likely to acquire the company. A Disney-Comcast bidding war launched in December when Disney offered $52.4 billion to buy Fox. Comcast countered with $65 billion in June, and Disney offered $71.3 billion a few days later. The U.S. Justice Department approved a Disney-Fox merger, provided Fox's sports networks aren't included because Disney already owns ESPN. Fox's shareholders will vote to accept Disney's bid on July 27th. Its film and TV studios, as well as its cable channels will go to Disney, while Fox News, Fox Sports, and local TV channels will be spun off into a new company.
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3. More illnesses from McDonald's salads reported
More illnesses have been reported in a cyclospora outbreak linked to salads at McDonald's restaurants in 10 states, federal health officials said Thursday. The number of illnesses linked to eating McDonald's salads rose from 61 to 163 in less than a week, with three hospitalizations and no deaths, the Food and Drug Administration announced. The fast-food chain has stopped selling salads in 3,000 restaurants in Illinois, Iowa, Indiana, Wisconsin, Michigan, Ohio, Minnesota, Nebraska, South Dakota, Montana, North Dakota, Kentucky, West Virginia, and Missouri as it works with the FDA to identify and trace the ingredients making people sick. The Centers for Disease Control and Prevention reported 237 cases of cyclosporiasis, with seven hospitalizations, linked to Del Monte Fresh vegetable trays in Minnesota, Wisconsin, Michigan, and Iowa.
4. Stocks struggle on trade concerns despite strong earnings
U.S. stock futures were mixed early Friday as markets struggled for direction in the face of escalating trade tensions. The gloom was offset by fresh strong corporate earnings reports. Futures for the Dow Jones Industrial Average edged down by 0.3 percent, while those for the S&P 500 and Nasdaq-100 were down by 0.2 percent and up by 0.3 percent, respectively. General Electric shares rose by 2.7 percent in pre-market trading after the company reported better-than-expected quarterly earnings and revenue. Microsoft shares were up by 3.5 percent after the software giant also released quarterly results that beat expectations, and issued stronger-than-anticipated guidance for the current quarter. Honeywell shares rose by 3 percent after it reported a strong quarter.
5. President Trump threatens more China tariffs
President Trump said in an interview on CNBC's Squawk Box on Friday that he was prepared to impose tariffs on all $500 billion in Chinese imports if China doesn't ease its trade policies toward the U.S. "I'm ready to go to 500," Trump told CNBC's Joe Kernen. The Trump administration so far has hit China with tariffs on $34 billion in Chinese goods, prompting China to respond in kind. The Trump administration is now reviewing potential levies on $200 billion in Chinese products, and China has threatened to retaliate again if Trump goes through with the proposal. Trump said the tariffs are necessary to get China to treat U.S. companies fairly, and stop forcing them to hand over their technology for access to Chinese markets.
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Harold Maass is a contributing editor at The Week. He has been writing for The Week since the 2001 debut of the U.S. print edition and served as editor of TheWeek.com when it launched in 2008. Harold started his career as a newspaper reporter in South Florida and Haiti. He has previously worked for a variety of news outlets, including The Miami Herald, ABC News and Fox News, and for several years wrote a daily roundup of financial news for The Week and Yahoo Finance.
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