Retail Disappointments, Energy Decline Hit Wall Street

Stocks dropped again Tuesday as losses mounted for the world’s largest technology companies. Retailers also fell, and energy companies plunged with oil prices as the market sank back into the red for the year. 

 

Oil prices tumbled another 6.6 percent as Wall Street reacted to rising oil supplies and concerns that global economic growth will slow down, a worry that’s intensified because of the trade tensions between the U.S. and China. 

 

Technology companies were hit after the Trump administration proposed new national security regulations that could limit exports of high-tech products in fields such as quantum computing, machine learning and artificial intelligence. 

 

Retailers also skidded. Target’s profit disappointed investors as it spends more money to revamp its stores and its website, while Ross Stores, TJX and Kohl’s also fell on disappointing forecasts. 

 

The S&P 500 index lost 48.84 points, or 1.8 percent, to 2,641.89. The Dow Jones industrial average sank 551.80 points, or 2.2 percent, to 24,465.64. 

 

The tech-heavy Nasdaq composite lost 119.65 points, or 1.7 percent, to 6,908.82. The Russell 2000 index of smaller-company stocks shed 27.53 points, or 1.8 percent, to 1,469.01. 

 

The Dow industrials have lost 3.7 percent in the last two days, and the S&P 500 is off 3.4 percent. The Nasdaq is off 4.7 percent. The S&P 500 index has fallen 9.9 percent from the record high it set exactly two months ago. 

 

Investors are measuring several headwinds and increasingly playing it safe. The global economy is showing signs of weakening, with the United States, China and Europe all facing the rising threat of a slowdown, which can hurt demand for commodities such as oil and threaten company profits. Trade tensions between the U.S. and China appear to be getting worse instead of improving, contributing to the sell-off in tech stocks and multinational industrial companies. 

 

For much of this year, investors were hopeful the U.S. and China would easily resolve their differences on trade. That hope has faded in the last two months. While U.S. President Donald Trump and Chinese President Xi Jinping are expected to meet this month at a gathering of the Group of 20 major economies, the proposed limits on tech exports were one more reason to worry. 

 

“A resolution doesn’t seem to be coming in the short term,” said Katie Nixon, the chief investment officer for Northern Trust Wealth Management. “A lot of the companies that are front and center [like] Alphabet, Apple, IBM … could be significantly limited in the way they export their technology.” 

 

Apple fell 4.8 percent to $176.98 and is down 23.7 percent from the peak it reached Oct. 3, though it’s still up almost 5 percent this year. Microsoft lost 2.8 percent to $101.71 and IBM fell 2.6 percent to $117.20. 

 

As the tech giants swoon, investors have lately turned to safer bets such as utilities, real estate companies and makers of household goods. They’ve also sought the safety of U.S. Treasuries. 

 

The price of oil has been falling sharply in recent weeks and is now down 30 percent since Oct. 3. 

 

Saudi Arabia and other countries started producing more oil after the Trump administration announced renewed sanctions on Iran, Nixon noted. The administration granted waivers to several countries that allowed them to continue importing oil from Iran, creating a supply glut that pushed prices dramatically lower. 

 

Nixon said OPEC countries will probably cut back on oil production, but some investors are worried that the buildup in crude stockpiles is a sign the global economy isn’t doing as well as expected. 

 

Earnings from retailers didn’t help investors’ mood. Target plunged 10.5 percent to $69.03 after reporting earnings that missed Wall Street’s estimates because of higher expenses. Ross Stores, TJX and Kohl’s also fell on disappointing forecasts. 

 

Tech stocks were among the biggest losers in Europe, too. Nokia and Ericsson, two top suppliers of telecom networks, each fell about 3 percent. European indexes fell, with Germany’s DAX index dropping 1.6 percent and the French CAC 30 falling 1.2 percent. Britain’s FTSE 100 lost 0.8 percent. 

 

Stocks also declined in Asia. Japan’s Nikkei 225 lost 1.1 percent and Hong Kong’s Hang Seng shed 2 percent. 

 

Benchmark U.S. crude lost 6.6 percent to $53.43 a barrel in New York. Brent crude, used to price international oils, fell 6.4 percent to $62.53 per barrel in London. Oil prices have nosedived since early October. 

 

Wholesale gasoline fell 5.5 percent to $1.50 a gallon and heating oil skidded 4.6 percent to $1.99 a gallon. Natural gas dipped 3.8 percent to $4.52 per 1,000 cubic feet. 

 

Bond prices were steady. The yield on the 10-year Treasury note remained at 3.06 percent. 

 

Gold slipped 0.3 percent to $1,221.20 an ounce. Silver fell 0.9 percent to $14.27 an ounce. Copper slid 1.2 percent to $2.77 a pound. 

 

The dollar fell to 112.40 yen from 112.54 yen. The euro fell to $1.1399 from $1.1453. 

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As Facebook Faces Fire, Heat Turns Up on No. 2 Sandberg

For the past decade, Sheryl Sandberg has been the poised, reliable second-in-command to Facebook CEO Mark Zuckerberg, helping steer Facebook’s rapid growth around the world, while also cultivating her brand in ways that hint at aspirations well beyond the social network.

But with growing criticism over the company’s practices, or lack of oversight, her carefully cultivated brand as an eloquent feminist leader is showing cracks. Questions these days aren’t so much about whether she’ll run for the Senate or even president, but whether she ought to keep her job at Facebook. 

“Her brand was being manicured with the same resources and care as the gardens of Tokyo,” said Scott Galloway, a New York University marketing professor. “And unfortunately a hurricane has come through the garden.”

Facebook has been dealing with hurricanes for the past two years: fake news, elections interference, hate speech, a privacy scandal, the list goes on. The company’s response — namely, Zuckerberg’s and Sandberg’s — has been slow at best, misleading and obfuscating at worst, as The New York Times reported last week. That report, and one from The Wall Street Journal , underscored Sandberg’s influence at the company, even as Zuckerberg has borne much of the criticism and anger. There have been calls for both to be ousted.

But because of the way Facebook is set up, firing Zuckerberg would be all but impossible. He controls the majority of the company’s voting stock, serves as its chairman and has — at least publicly — the support of its board of directors. Essentially, he’d have to fire himself. Firing Sandberg would be the next logical option to hold a high-level executive accountable. Though the chances are slim, the fact that it has even come up shows the extent of Facebook’s — and Sandberg’s — troubles.

 As chief operating officer, Sandberg is in charge of Facebook’s business dealings, including the ads that make up the bulk of the company’s revenue. She steered Facebook from a rising tech startup into a viable global business expected to reap $55 billion in revenue this year. The company is second only to Google in digital advertising.

But she’s also gotten the blame when things go wrong, including Facebook’s failure to spot Russian attempts to influence U.S. elections by buying U.S. political ads — in rubles. Though Sandberg has denied knowing that Facebook hired an opposition research firm to discredit activists, she created a permissive environment through what the Times called an “aggressive lobbying campaign” against critics. Facebook fired the firm, Definers, after the Times report came out.

Facebook declined to comment on Sandberg or make her available for an interview. A representative instead pointed to Zuckerberg’s remarks that overall, “Sheryl is doing great work for the company. She’s been a very important partner to me and continues to be, and will continue to be. She’s leading a lot of the efforts to improve our systems in these areas.”

Sandberg, 49, who was hired away from Google in 2008, has been a crucial “heat shield” for Zuckerberg, as Galloway put it, as lawmakers and the public crank up criticism of the 34-year-old founder. In September, Facebook sent Sandberg to testify before the Senate intelligence committee, eliciting a warmer response than her boss did three months before. 

Sandberg, former chief of staff for treasury secretary Larry Summers, appears more comfortable in Washington meeting rooms than Zuckerberg, who can seem robotic. Her profile is high enough that lawmakers don’t feel stilted when she shows up. She’s written (with help) two books, including 2013’s “Lean In” about women and leadership. Her second book, “Plan B,” is about dealing with loss and grief after her husband died unexpectedly. She was the lone chief operating officer among a who’s who of tech CEOs — including Apple’s Tim Cook and Amazon’s Jeff Bezos — to meet with Donald Trump a month after his election.

“It’s both who she is and how bereft Silicon Valley is of strong, powerful female voices,” crisis management expert Richard Levick said. “She has positioned herself as one of those strong voices with ‘Lean In.’’’

But her high profile also makes her more susceptible to criticism.

The chorus for Sandberg to leave is getting louder. CNBC commentator Jim Cramer predicted Monday that Facebook’s stock would rise if Sandberg leaves or gets fired. NYU’s Galloway believes both Sandberg and Zuckerberg should be fired for allowing Facebook to turn into an entity that harms democracy around the world.

“Every day executives are fired for a fraction of infractions these two have committed,” he said.

Besides elections interference, Zuckerberg and Sandberg have been criticized for their slow response to the Cambridge Analytica scandal, in which the data-mining firm accessed millions of users’ private information without their permission. The pair were silent for days after the news came out.

According to the Journal, Zuckerberg told Sandberg this spring that he blamed her and her teams for the “public fallout” over Cambridge Analytica. Citing unnamed sources, the newspaper said Sandberg at one point wondered if she should be worried about her job (though that appears to no longer be the case, based on Zuckerberg’s public support).

Galloway said it would look bad for Facebook to fire one of the only top female executives in an industry where women “face inordinately high obstacles to get to leadership positions.”

Beyond that, Sandberg has also been a positive force on Facebook. She was hired to be the “adult” in the room and has filled that role well. She moves comfortably outside tech circles and in public speaking, countering Zuckerberg’s shortcomings in that area. 

If anything, Sandberg’s departure from Facebook would likely be on her own terms. While Zuckerberg has spent all of his adult life at Facebook, Sandberg had a career before Facebook and even tech, so it is plausible that she would have a life after Facebook, perhaps back in politics.

But first, she has Facebook’s own troubles to deal with. The task seems daunting because its problems might never go away. But Levick believes she can begin to restore her image by acknowledging her role in causing Facebook’s problems instead of blaming external forces beyond her control: “The knee jerk response ‘poor, poor’ me’ is not the solution.”

 

 

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Boeing Cancels Call to Discuss Issues With Its Newest Plane 

Analysts say Boeing Co. is canceling a conference call that it scheduled to discuss issues around its newest plane, which has come under scrutiny since a deadly crash in Indonesia. 

The company didn’t immediately give an explanation Tuesday. 

CFRA Research analyst Jim Corridore said canceling the call as “a bad look for the company” when it’s facing questions about potential problems with sensors on the 737 MAX. 

U.S. airline pilots say they weren’t told about a new feature that could pitch the nose down automatically if sensors indicate the plane is about to stall. 

On Oct. 29, a Lion Air MAX 8 plunged into the Java Sea, killing all 189 people on board. 

Boeing shares are down about 13 percent since Nov. 9. 

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У держбюджеті на 2019 рік закладене фінансування доставки пенсій у села – Омелян

Уряд передбачив у проекті державного бюджету на наступний рік збільшення фінансування «Укрпошти». Про це повідомив міністр інфраструктури України Володимир Омелян.

«В проекті бюджету 2019 закладаються 500 млн грн для Укрпошти, вперше за десятиліття. Ці гроші будуть спрямовані виключно для фінансування заробітної плати поштарів «останньої милі», – написав міністр у Facebook.

За його словами, додаткові кошти дозволять забезпечити безперебійну доставку пенсій та гарантують «збереження робочих місць та заробітної плати співробітникам «Укрпошти», які забезпечують присутність держави в найменших населених пунктах України».

Читайте також: Чому в «Укрпошті» пішли на ультиматум: виплата пенсій досі під сумнівом

26 жовтня генеральний директор «Укрпошти» Ігор Смілянський заявляв, що очолюване ним підприємство вимушене буде відмовитися доставляти пенсії з 1 січня 2019 року, якщо Пенсійний фонд не сплачуватиме за послугу за економічно обгрунтованими тарифами. Така заява викликала різку реакцію Володимира Гройсмана, який звернувся до наглядової ради уряду з проханням надати оцінку діям керівництва «Укрпошти».

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Nissan Says Chairman Arrested for Financial Misconduct in Japan

Shares in automakers Nissan, Mitsubishi and Renault fell sharply Tuesday after the arrest of executive Carlos Ghosn on allegations of “significant acts” of financial misconduct.

All three firms are considering replacing him as chairman.

Nissan, one of the world’s biggest automakers, said Ghosn falsified reports about his compensation “over many years” and that its internal investigation also found he had used company assets for personal purposes.

Japanese media reported Monday that Ghosn is being questioned by Tokyo prosecutors, suspected of failing to report millions of dollars in income. 

Nissan said that based on a report by a whistleblower, it conducted an internal investigation of Ghosn and Representative Director Greg Kelly and shared its findings with public prosecutors. The company said both men had been arrested.

The automaker said its investigation showed that Ghosn had underreported his income to the Tokyo Stock Exchange by more than $40 million over five years.

The Ashai newspaper reported that prosecutors have raided Nissan’s headquarters in Yokohama. 

The Brazilian-born Ghosn, who is of Lebanese descent and a French citizen, was the rare foreign top executive in Japan.

Ghosn was sent to Nissan in the late 1990s by Renault SA of France, after it bought a controlling stake of Nissan. He is credited with rescuing Nissan from the brink of bankruptcy.

In 2016, Ghosn also took control of Mitsubishi, after Nissan bought a one-third stake in the company, following Mitsubishi’s mileage-cheating scandal. 

Together, the three automakers comprise the biggest global carmaking alliance, manufacturing one of every nine cars sold around the world. The three companies employ more than 470,000 people in nearly 200 countries.

Before Ghosn’s arrest, Satoru Takada, an analyst at TIW, a Tokyo-based research and consulting firm, said his detention would “rock the Renault-Nissan-Mitsubishi alliance as he is the keystone of the alliance.”

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Apple, Trade Woes Sink Stocks; Growth Worries Drag on Dollar

World stock markets fell Monday as worries about softening demand for the iPhone dragged down shares of Apple Inc and persistent trade tensions between China and the United States sapped investor sentiment.

Concerns about slowing economic growth also pushed down the dollar.

The U.S. benchmark S&P 500 stock index dropped 1.7 percent following a decline in shares of Apple and its suppliers. The Wall Street Journal reported Apple had cut production orders in recent weeks for iPhone models it launched in September.

Renewed tensions between China and the United States also weighed. At an Asia-Pacific Economic Cooperative meeting in Papua New Guinea over the weekend, the issue prevented leaders from agreeing on a communique, the first time such an impasse had occurred in the group’s history.

U.S. Vice President Mike Pence said in a blunt speech Saturday that there would be no end to U.S. tariffs on $250 billion of Chinese goods until China changed its ways.

“That APEC was unable to issue a final statement clearly indicates that China versus the rest of the world isn’t just about the United States,” said Brad McMillan, chief investment officer for Commonwealth Financial Network in Waltham, Massachusetts. “It’s a widening of trade concerns that are already rattling markets.”

The Dow Jones Industrial Average fell 395.78 points, or 1.56 percent, to 25,017.44, the S&P 500 lost 45.54 points, or 1.66 percent, to 2,690.73 and the Nasdaq Composite dropped 219.40 points, or 3.03 percent, to 7,028.48.

MSCI’s gauge of stocks across the globe gained 0.30 percent.

Mixed signals regarding the Federal Reserve’s course of rate hikes in the face of a potential economic slowdown also weighed on markets, investors said.

Federal Reserve policymakers have recently raised concern about a potential global slowdown, leading some market watchers to suspect the tightening cycle may not have much further to run.

Data released Monday by the National Association of Home Builders showed weakening sentiment in the U.S. housing market, adding to concerns over economic growth.

Still, New York Fed President John Williams stated that the U.S. central bank is moving ahead with its plans for gradual rate hikes as it marches toward a more normal policy stance.

“There’s a widening gap between the Fed and what the markets think is the right course,” McMillan said.

Reflecting economic growth concerns, the dollar dropped to a two-week low Monday. The dollar index fell 0.3 percent.

In similar fashion, the 10-year U.S. Treasury yield hit its lowest level in more than a month. Benchmark 10-year notes last rose 3/32 in price to yield 3.0628 percent, from 3.074 percent late Friday.

Boosted by the drop in the dollar, gold added 0.2 percent to $1,223.56 an ounce.

Oil prices edged up, finding support from a reported drawdown of U.S. inventories, potential European Union sanctions on Iran and possible OPEC production cuts.

Brent crude futures settled at $66.79 a barrel, up 3 cents. U.S. crude futures settled at $56.76 a barrel, up 30 cents.

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