The daily business briefing: December 27, 2018
The Dow bounces back from Christmas Eve losses but futures fall, Trump considers barring gear purchases from Chinese companies, and more
- 1. Dow rebounds from Christmas Eve rout, but futures drop
- 2. Trump considering blocking purchases of Huawei, ZTE equipment
- 3. Shutdown to delay economic data from some federal agencies
- 4. U.S. officials will travel to China for trade talks
- 5. LinkedIn co-founder apologizes for ties to company accused of election misinformation
1. Dow rebounds from Christmas Eve rout, but futures drop
The Dow Jones Industrial Average shot up by 1,086 points — or nearly 5 percent — on Wednesday, its best day since 2009 and its biggest point gain ever. The S&P 500 also rose by nearly 5 percent and the Nasdaq Composite gained 5.6 percent. The massive gains came as retail stocks jumped on news of strong holiday sales, marking a sharp rebound after the biggest Christmas Eve trading slump in history, which continued the stock market's worst December since the Great Depression. President Trump on Tuesday said the market plunge represented a "tremendous opportunity to buy." Markets also seemed placated after White House economic adviser Kevin Hassett said Fed Chairman Jerome Powell's job is "100 percent safe" despite Trump's anger over Fed interest-rate hikes. Stock futures fell sharply early Thursday, pointing to continuing volatility.
The Washington Post MarketWatch
2. Trump considering blocking purchases of Huawei, ZTE equipment
President Trump is considering an executive order to bar U.S. companies from using telecommunications equipment made by China's Huawei and ZTE, Reuters reported Thursday, citing three sources familiar with the situation. The U.S. has accused both companies of helping the Chinese government by using their gear to spy on Americans. Trump's order has been under consideration for months and could be issued in January. It would instruct the Commerce Department to bar U.S. companies from buying foreign telecommunications equipment that could pose major national security risks, industry and administration sources told Reuters. The issue is taking on new urgency as companies seek partners for next-generation 5G wireless networks. China's Foreign Ministry declined to comment until the order has been confirmed.
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3. Shutdown to delay economic data from some federal agencies
As financial markets remain locked in turmoil, investors are starting to find economic data in short supply due to the government shutdown. Reports produced by the Commerce Department's Census Bureau and Bureau of Economic Analysis won't be coming out during the shutdown, a spokeswoman said Wednesday. The Department of Agriculture won't be releasing its data on crop production, prices, and sales, either. The Department of Labor is funded through September 2019, so it will be able to provide its early January report on December hiring. The shutdown has left hundreds of thousands of workers in federal agencies furloughed or forced them to continue working without pay.
4. U.S. officials will travel to China for trade talks
A U.S. trade team will meet with Chinese counterparts in Beijing the week of Jan. 7 to discuss easing U.S.-China trade tensions, Bloomberg reported Wednesday, citing two people familiar with the matter. Deputy U.S. Trade Representative Jeffrey Gerrish will lead the delegation. Representatives of both sides had held talks by phone to prepare for the meeting, the first face-to-face talks since President Trump and Chinese President Xi Jinping met in Buenos Aires on Dec. 1. Trump and Xi agreed to hold off on intensifying their exchange of tit-for-tat tariffs, which have disrupted imports and exports between the world's two biggest economies. News of the talks helped lift U.S. stock.
5. LinkedIn co-founder apologizes for ties to company accused of election misinformation
LinkedIn co-founder Reid Hoffman apologized Wednesday for Russian-style misinformation allegedly spread during the 2017 Alabama Senate race by a group he funded. The New York Times reported last week that American Engagement Technologies, a firm Hoffman invested in, funneled money to a project that conducted a small-scale experiment using Facebook posts by people who pretended to be conservatives, and used language seeking to divide actual conservatives. The phony posts encouraged people to write in a candidate instead of voting for Alabama Republican Roy Moore, who had been accused of committing sexual misconduct with underage girls decades ago. In a post on his blog, Hoffman said he was not aware of the experiment, and that he "categorically" disavowed using misinformation to sway elections.
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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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