The daily business briefing: April 8, 2021
U.S. trade deficit hits a record as imports surge, Biden is open to compromise on corporate tax hike, and more
Trade deficit hits record high as imports meet rising U.S. demand
The U.S. trade deficit jumped 4.8 percent to a record high of $71.1 billion in February, the Commerce Department said Wednesday. Economists polled by Reuters had expected a slightly smaller deficit of $70.5 billion. The increase came as the nation bounced back following the winter coronavirus surge, and part of the rising demand was met with added imports. The economy in the United States is getting stronger, with President Biden's $1.9 trillion coronavirus relief package expected to trigger faster growth and greater demand for imports. "The deficit could remain wide this year and next because of the fiscal stimulus and potential infrastructure package that could pass in the second half of this year," said Ryan Sweet, a senior economist at Moody's Analytics.
Biden open to compromise on corporate tax rate
President Biden said Wednesday that he would consider reducing the corporate tax hike he is proposing to pay for his more than $2 trillion infrastructure plan, but he added that doing nothing was not an option. Republicans oppose Biden's call for raising the corporate tax rate to 28 percent from the 21 percent established in former President Donald Trump's 2017 tax cut, and even some moderate Democrats are against raising the rate beyond 25 percent. "Debate is welcome. Compromise is inevitable. Changes are certain," Biden said, adding that he would invite Republican lawmakers to the White House to discuss the proposal. Biden's plan calls for building roads and bridges, expanding broadband internet access, caring for the elderly, building high-speed rail, and other projects over eight years.
S&P 500 futures rise after latest record
S&P 500 futures rose early Thursday after the blue-chip index rose by less than 0.2 percent on Wednesday to close at the latest in a string of record highs. Futures for the S&P 500 were up by nearly 0.3 percent several hours before Thursday's opening bell. Futures for the Dow Jones Industrial Average were flat, while those of the tech-heavy Nasdaq gained 0.9 percent. The S&P 500 scored its latest record Wednesday thanks to a late-day surge that came after the release of the minutes from the Federal Reserve's last policy meeting suggested that the central bank would keep its asset purchase unchanged for the foreseeable future to support the economy and keep inflation and hiring on track.
2 CBS executives leave after allegations of racist, sexist comments
CBS said Wednesday it had severed ties with top executives in its television station group who were suspended in January over allegations they contributed to a hostile work environment. The executives, Television Stations Group President Peter Dunn and Senior Vice President of News David Friend, faced an internal investigation after the Los Angeles Times reported allegations that they mocked Black on-air talent, opposed efforts to hire Black journalists, and bullied female executives. CBS Entertainment Group Chief Executive George Cheeks said in a memo to staff reviewed by The Wall Street Journal that the investigation was continuing, but he didn't reveal any preliminary findings. He said the process was "sometimes painful and emotional," but important for "living up to our promise of a safe, inclusive, respectful, and equitable workplace for all of us."
Amazon union vote turnout exceeded expectations at 55 percent
Turnout was roughly 55 percent in last month's union election at an Amazon warehouse in Bessemer, Alabama, according to the Retail, Wholesale and Department Store Union. The figure was higher than the union previously estimated. A total of 3,215 ballots were cast, but hundreds have been challenged, mostly by Amazon, according to the union. The public part of the vote count could begin Thursday or Friday. If the margin of victory is smaller than the number of contested ballots, the final count will be delayed until challenges are settled. The vote could have far-reaching implications, as it could result in the establishment of Amazon's first unionized warehouse in the U.S. Union advocates say it could address grievances, including a grueling work pace. Amazon says the union isn't necessary.