US markets closed mixed on Friday, capping a week of investor jitters over trade negotiations between the United States and China.
The Dow fell 64 points, or 0.3%, but eked out a weekly gain. The Dow was down more than 250 points earlier in the day but recovered most of those losses by market close. The S&P 500 and the Nasdaq both closed slightly higher, up about 0.1%, after trending lower for most of the day.
It was the seventh straight week of gains for all three.
Video game maker Electronic Arts (EA) jumped 16% after touting the strong debut for its Apex Legends game.
Tire manufacturer Goodyear (GT) was the worst performer in the S&P 500, falling 9% after reporting weak results.
Video game maker Electronic Arts badly needs a hit to compete with the Fortnite juggernaut. It might just have one.
Shares of Electronic Arts (EA) surged nearly 15% Friday after the head of the company’s Respawn Entertainment subsidiary tweeted about huge numbers for its new Apex Legends multiplayer “battle royale” game.
Ten million players in three days is an impressive feat. If Apex Legends can continue to gain momentum, that would be great news for EA. Fortnite has crushed the traditional gamers lately.
Ford’s head of robotics believes driverless cars will save countless lives.
“I 100% believe that self-driving cars will be safer than human-driven vehicles,” Jianbo Lu, head of robotics and intelligent vehicles at Ford (F), told CNN Business on Friday from the sidelines of the Cayman Alternative Investment Summit in Grand Cayman.
Lu said that about 40,000 people per year die due to car accidents – and more than 90% of accidents are due to driver error.
Ford recently announced plans to have a driverless car in commercial operation in 2021. The vehicles will be “fully autonomous,” operating without a steering wheel, gas pedal or brake pedal. However, Ford said these vehicles will be “geo-fenced” – operating only within certain areas – as part of a ride sharing or ride hailing experience.
Goodyear (GT) is having a terrible day:
🔻Shares are down more than 8% for the year.
The ongoing trade war between the United States and China could be more problematic for the former country, rather than the latter.
Parag Khanna, author of “The Future is Asian,” said the US has “massively underestimated the extent to which China and its neighbors can actually substitute” the US.
Khanna told First Move anchor Julia Chatterley that China’s largest trading partners are its neighbors, including Japan, South Korea and India.
“When we impose impose export controls on sensitive technologies, China will just get them from Japan and Korea. said Khanna. “That will be bad for our business.”
Amazon (AMZN) might scuttle its plans to build a new campus in New York City’s Long Island City neighborhood, according to a new report.
The Washington Post said Amazon executives have had discussions recently to rethink the company’s plans for New York and consider alternatives after the backlash to its proposal.
The retailer’s shares were down about 2.5% Friday morning, and didn’t move much after the report came out.
New York Congresswoman Alexandria Ocasio-Cortez, a vocal opponent of the deal, celebrated the news on Twitter:
Amazon did not immediately respond to CNN Business’ request for comment.
US market losses are accelerating into the middle of the day.
The Dow fell roughly 180 points, or 0.7%. The index is now below 25,000 and is solidly down for the week — its first negative week since before Christmas.
The S&P 500 and the Nasdaq both moved lower.
If Friday’s selloff continues, it would be the market’s third straight day of losses. Stocks closed slightly lower Wednesday, and plunged Thursday on suggestions that the United States and China aren’t close to a trade deal.
Toy company Mattel is still up about 22% after it said its Barbie and Hot Wheels franchises performed well in the last quarter.
Rival Hasbro slumped 4%. The company is struggling because its fortunes are closely tied to Disney’s movie slate, and there were no “Star Wars” or Disney Princess movies during the last holiday season.
The planned merger between SunTrust (STI) and BB&T (BBT) banks is an “enormous deal,” according to a wealth manager.
John Petrides, the managing director for wealth management firm Point View, said the $66 billion deal announced yesterday to form the sixth-largest bank is a sign of a healthy economy.
“If the deal gets done, it’s a massive windfall for the rest of the banking sector,” he told First Move anchor Julia Chatterley. He added that because there are more than 6,000 banks in the US, there is “clearly more room for consolidation.”
Although he doesn’t think there’s a recession nearing, the bank merger indicates we’re at the top of an economic cycle.
Eileen Murray, the co-CEO of the world’s largest hedge fund, said the financial industry needs to repair its relationship with regulators.
“I think of the regulators as a client. And treat them as such,” Murray said on Friday at the Cayman Alternative Investment Summit in Grand Cayman.
Murray fondly recalled that Morgan Stanley (MS) had a cordial relationship with its regulators during the 1980s when she worked there. But that link broke down after the 2008 financial crisis, which was caused in part by lax regulation.
“I’ve heard people whine quite a bit about regulation. If we step back and think about why we’re in this position, we only have ourselves to blame,” she said.
Skechers sneakers are hot.
Sales boomed 11.4% during its latest quarter, the company announced late Thursday. That sent Skechers’ (SKX) stock up 17% during Friday trading.
International sales, including in China, helped lift the company. Skechers has also focused on offering new styles, like a popular slip-on shoe, to drive growth.
Skechers has benefited from a shift to more casual clothes and sneakers. Other brands, like Lululemon (LULU) and Nike (NKE), have also jumped on the trend.
“We remain the number one lifestyle casual, dress casual, walking and work brand in the United States,” said Skechers CEO Robert Greenberg.
Economists are growing worried about the massive amount of debt companies around the world have piled on since the last financial crisis.
“There’s too much debt in the world,” KPMG chief economist Constance Hunter said on Friday at the Cayman Alternative Investment Summit.
Hunter recalled that the Great Recession was caused by excess debt among American households and in the mortgage industry.
Jim McCaughan, a veteran asset manager who worked at UBS, PIMCO and Principal, warned about leverage in student loans, China and retail.
“There’s zombie malls all across the US,” he said.
Another concern: McCaughan said that European banks, unlike their American peers, never fully cleaned up their balance sheets from the last crisis.
“Excess debt in the world makes it a more dangerous place,” he said.
US markets opened lower Friday, kicking off what could be the third straight day of losses.
The Dow hasn’t had a down week since before Christmas.
Uncertainties about trade are driving some of the market fears. Stocks plunged Thursday after a member of President Donald Trump’s economic team suggested the United States and China weren’t close to a deal.
Toy company Mattel (MAT) jumped 26%, a day after it reported solid fourth-quarter earnings. Competitor Hasbro (HAS) was about flat after it said the closure of Toys “R” Us hurt more than expected.
CEO Hans Vesterberg will add chairman to his title after former Verizon chairman (and CEO) Lowell McAdam steps down in March.
The changes were announced earlier today:
The two beverage companies recently announced similar executive moves.
Somewhere, corporate governance advocates are wagging their fingers.
It’s a tale of two stories for toymakers:
Jaguar Land Rover’s poor performance in China is causing major headaches for its parent company.
Shares in Indian carmaker Tata Motors (TTM) plunged as much as 30% in Mumbai after the company reported a record loss of $3.8 billion. The stock recouped some of its losses later in the day to trade down 17%.
Tata Motors said it had taken a massive 3.1 billion ($4 billion) writedown on its JLR assets.
The brand has been hard hit in China, where January sales plunged 40% from the previous year amid a broad economic slowdown.
Concerns that the trade conflict between the US and China may not be resolved before the looming deadline are pulling down global markets.
Japan’s Nikkei dropped over 2% today, and Hong Kong’s Hang Seng closed in negative territory. European markets opened lower.
US stock futures also declined, suggesting that the sell-off that pushed the Dow and S&P 500 down 0.9% yesterday will continue when markets open in New York.
Fears over trade deepened after White House economic adviser Larry Kudlow said that there was a “pretty sizable distance” between Beijing and Washington in trade negotiations.
President Donald Trump also said he was unlikely to meet with his Chinese counterpart Xi Jinping before March 2, when a trade truce between the two sides expires.
Trump has threatened to increase existing tariffs and impose a third wave of penalties on Chinese imports if the two sides can’t come to a permanent agreement.
Luxury fashion house Hermes has reported sales of almost €6 billion ($6.8 billion) in 2018, a rise of 10% compared to the previous year.
The company did particularly well in China and Southeast Asia, where sales increased 14%.
L’Oreal, the world’s biggest cosmetics company, reported that strong sales in China helped its sales grow at the fastest pace in a decade. Asia Pacific has now overtaken North America as its top market.
Hermes (HESAY) stock was up 1.4% while shares in L’Oreal (LRLCF) gained 0.8%.
They’re the latest companies to defy expectations that an economic slowdown in China would hurt luxury brands. Apple (AAPL) helped sparked the concerns earlier this year when it warned of weaker iPhone sales in the country.
LVMH (LVMHF), the owner of brands including Dior and Louis Vuitton, posted record annual sales last week.
