Retail: Online shopping dominates holiday sales
“It’s official: Cyber Monday 2016 was the biggest day in the history of U.S. e-commerce,” said Phil Wahba in Fortune.com. Consumers spent $3.45 billion online during this week’s digital shopping event, according to Adobe Digital Insights, up 12.1 percent over last year. Shoppers also migrated online for Black Friday deals. An estimated 108.5 million Americans shopped online over the Thanksgiving weekend, “well above the 99.1 million who hit stores.” Last year’s numbers were roughly equal to one another. Online sales tallies topped $5 billion for Thanksgiving and Black Friday, with Walmart, Kohl’s, and Target setting company records for digital sales.
“Foot traffic at malls and shopping centers was thinner than the frenzied crowds of years past,” said Sarah Nassauer in The Wall Street Journal. Many retailers rolled out discounts throughout November, offering many of the same promotions online as in stores. Perhaps as a result, the number of store visitors fell nearly 11 percent on Black Friday from last year, while sales dropped more than 10 percent. The holiday sales season is a delicate balance for brick-and-mortar retailers. Many have invested billions in e-commerce to fend off the likes of Amazon, but online orders are generally costlier for retailers than in-store sales, squeezing margins.
Economy: GDP growth higher than expected
“America’s economy is picking up more momentum than previously thought,” said Patrick Gillespie in CNN.com. The U.S. economy grew 3.2 percent in the third quarter, according to revised GDP estimates published by the Commerce Department this week. That’s up from an initial estimate of 2.9 percent, already “the best quarter of growth in two years.” Increased consumer spending, which makes up the bulk of America’s economic activity, was the primary reason for the strong report. The Atlanta Federal Reserve forecasts that growth between October and December will be an impressive 3.6 percent.
Energy: OPEC agrees to oil production cuts
OPEC will slash oil production for the first time since 2008, said Ahmad Ghaddar in Reuters.com. The Organization of the Petroleum Exporting Countries agreed this week to reduce production by 4.5 percent, or about 1.2 million barrels per day, in a bid to prop up global oil prices, “which have halved since 2014.” The cartel made a preliminary agreement in September to cap output, but Saudi Arabia and Iran have clashed over how to divvy up production cuts. As part of the deal, Saudi Arabia will take the biggest hit, cutting production by 500,000 barrels per day, while Iran will freeze output near its current level.
Tech: Samsung mulls major restructuring
“South Korea’s most valuable company is probably going to split as soon as next year,” said Jungah Lee in Bloomberg.com. Samsung said this week that it’s exploring a plan to divide into holding and operating companies, with the aim of boosting shareholder value. The proposal was floated by U.S. hedge fund Elliott Management Corp. last month amid Samsung’s massive recall of the Galaxy Note 7 smartphone. The fund said the split would be a way to “boost transparency and accountability” in the company, which is dominated by the founding Lee family.
Aerospace: WTO smacks down Boeing tax breaks
The World Trade Organization has ordered the U.S. to halt what it deems to be illegal state tax breaks for Boeing, said Peggy Hollinger in the Financial Times. The intergovernmental organization ruled this week that a tax break granted to Boeing by the state of Washington in 2013 amounts to a “prohibited subsidy.” The ruling is a victory for Europe’s Airbus in the long-running battle between the world’s two biggest aircraft makers. The U.S. and European Union have accused each other of providing illegal support to their continent’s aerospace giant.