Chevron Corp. scored a reversal of fortunes in Venezuela last weekend after the U.S. government allowed it to pump oil there again, but its new license to operate carries considerable risk.
The oil giant will have to partner with an authoritarian regime accused of crimes ranging from human-rights violations to sprawling corruption to state-sponsored narcotics trafficking.
Clashes Over FTX Bankruptcy Go Global
The collapse of cryptocurrency exchange FTX has opened a hornet's nest of squabbles between foreign governments and its new U.S. chief executive, John J. Ray III.
In Cyprus, the country's securities regulator is complaining that Mr. Ray's decision to place FTX in bankruptcy has stymied investigations and is preventing European customers from getting their money back. Officials in the Bahamas, where FTX moved its headquarters last year, are accusing Mr. Ray of making false statements and suggesting that his team is motivated by the prospects of earning hefty legal fees. In Turkey, authorities have seized the assets of FTX's local subsidiary, an affront to Mr. Ray's efforts to sweep FTX's assets into the chapter 11 process in Delaware.
Business-Software Companies Say Customers Are Pulling Back Amid Economic Concerns
Business-software companies say customers are being more cautious with their spending in response to a challenging economy, adding to the tech industry's list of concerns.
Customers for companies such as Salesforce Inc., Okta Inc. and CrowdStrike Holdings Inc. are taking longer to sign deals, and in some cases slowing their hiring plans as they try to protect their bottom lines, the software providers reported this past week. That trend has created a cloudy outlook for many in the once-booming business-software sector, which benefited from years of demand as customers looked to use the products to trim costs and maintain their businesses during the pandemic.
Robert Iger's Return Opens Door for Florida Lawmakers to Consider Restoring Disney's Tax Privileges
A Florida lawmaker said Robert Iger's return as Walt Disney Co.'s chief executive has boosted the prospects that the state could work out a new deal with the entertainment company after passing an April law to end certain Disney tax privileges.
A special district, created in 1967 and known as the Reedy Creek Improvement District, has exempted Disney from numerous regulations and various taxes and fees. It has permitted the company to manage its theme parks and resorts in Florida with little red tape for more than 50 years. Under the law passed in April, the special district would be dissolved on June 1, 2023.
Apple Makes Plans to Move Production Out of China
In recent weeks, Apple Inc. has accelerated plans to shift some of its production outside China, long the dominant country in the supply chain that built the world's most valuable company, say people involved in the discussions. It is telling suppliers to plan more actively for assembling Apple products elsewhere in Asia, particularly India and Vietnam, they say, and looking to reduce dependence on Taiwanese assemblers led by Foxconn Technology Group.
Turmoil at a place called iPhone City helped propel Apple's shift. At the giant city-within-a-city in Zhengzhou, China, as many as 300,000 workers work at a factory run by Foxconn to make iPhones and other Apple products. At one point, it alone made about 85% of the Pro lineup of iPhones, according to market-research firm Counterpoint Research.
From CNN to Paramount, Media Companies Cut Jobs as Pressures Mount
An advertising slowdown, economic worries and strains of the shift to streaming have many major media companies in cost-cutting and layoff mode.
News organizations, TV networks, movie and television studios, and entertainment giants laid off hundreds of workers over the past week alone, including Warner Bros. Discovery Inc.'s CNN and Paramount Global's television-production units.
Delta Air Lines Offers Pilots 34% Raises Over Four-Year Deal
Delta Air Lines Inc. is offering pilots raises amounting to at least 34% over the term of a proposed deal, another sign of how pilots are pushing the now-booming airline industry for better pay and other benefits.
The proposal still needs to be approved by union leaders and then would have to be ratified by Delta's pilots. But an agreement would set a bar for rivals that are also trying to hammer out new contracts in what has effectively become an industrywide standoff between airlines and pilots' unions.
Fed Could Pencil in Higher Interest Rates Next Year While Slowing Hikes in December
Federal Reserve officials have signaled plans to raise their benchmark interest rate by 0.5 percentage point at their meeting next week, but elevated wage pressures could lead them to continue lifting it to higher levels than investors currently expect.
They have raised rates this year at the fastest pace since the early 1980s, including by 0.75 point at each of their past four meetings to combat inflation. Fed Chair Jerome Powell indicated last week that the central bank was prepared to downshift the size of rate increases at its coming meeting on Dec. 13-14.
Bond Rally Drags 10-Year Treasury Yield Back Down to 3.5%
Hopes that inflation is easing have driven a weekslong rally in government bonds, pulling the 10-year U.S. Treasury yield back to 3.5% for the first time since September.
Treasurys started rallying with stocks after the Labor Department released better-than-expected consumer-price index data on Nov. 10. That move was supercharged last week when Federal Reserve Chairman Jerome Powell sent the clearest signal yet that the central bank plans to raise short-term interest rates by half a percentage point at its Dec. 13-14 meeting, a step down from the 0.75 percentage point increases of the past four meetings.
Oil Price Rises After Russia Cap Kicks In
The West imposed sanctions on Russian crude, pitching the energy conflict with Moscow into an unpredictable new phase that could inject further volatility into global oil markets.
The European Union and U.K. barred inbound shipments of Russian crude Monday-a watershed for a continent striving to end its dependence on Russia's fossil fuels after Moscow invaded Ukraine and weaponized supplies of natural gas. In tandem, the EU, the U.S. and allies placed curbs on shipping, insuring and funding Russian crude anywhere in the world.
OPEC+ Keeps Oil Curbs Despite Russia Price Cap
OPEC+ said Sunday it would lock in current production levels, a pause that suggests the world's leading oil producers are uncertain about the direction of crude prices with a price cap on Russia's petroleum exports set to take effect.
The decision on Sunday allows the Organization of the Petroleum Exporting Countries and a group of producers led by Russia-collectively known as OPEC+-to take more time to assess the market impact of an EU and Group of Seven price cap, which is intended to crimp Russia's revenue for the Ukraine war. It locks in a 2 million-barrels-a-day production cut decided in October.
Must Inflation Be Brought Down All the Way to 2%?
"Why must inflation be around 2%?" is a question that obsessed central bankers back when inflation was stubbornly below their favorite target. It makes more sense to ask it now.
This past week, a string of data has suggested that inflation is finally on a downward trend. The U.S. personal-consumption expenditures price index excluding food and energy-the Federal Reserve's preferred measure of inflation-recorded its second-smallest monthly increase for the year, even as consumer spending jumped and job growth continued. Meanwhile, eurozone inflation receded to 10% in November, suggesting that October's 10.6% was the peak.
Economists Think They Can See Recession Coming-for a Change
If the economy shrinks next year, no one should be surprised. We're facing the most widely forecast recession in history-and investors don't seem to care.
Recession in Europe and the U.K. is already the average of economic predictions, while the U.S. average forecast for next year is growth of a miserly 0.2%, according to Consensus Economics, the third lowest since 1989.
Dow Shines as Higher Rates Squeeze Nasdaq's Tech Stocks
The Dow is beating the broader market to a degree not seen in nearly a century.
The Dow Jones Industrial Average is down 5.3% this year, which isn't normally a cause for celebration. But that performance looks downright golden compared with the broad S&P 500, which is off 15%, and the tech-heavy Nasdaq Composite, which has dropped 27%.
What Types of Bonds Deliver the Best Returns?
With interest rates on the march this year, many investors are looking at bonds again, for the first time in 10-plus years, as a true income-delivering alternative to stocks.
Indeed, while investors have exited equities along with the downturn in that sector, many have sought safety in short-term debt holdings such as money-market funds.
Threat of Rail Strike Reveals Persistent Supply-Chain Risks to U.S. Economy
The threat of a railroad strike this month exposed the vulnerability of U.S. transportation networks and revealed potential new risks of supply-chain disruptions just as pandemic-era bottlenecks were fading.
President Biden signed into law a bill Friday compelling freight railroads and their workers' unions to accept a labor agreement, averting a strike that might have disrupted a logistical linchpin of the economy. Even with the dispute resolved, the episode brought about a heightened awareness that supply hiccups could become an ongoing feature of business life in America.
China Loosens Covid Restrictions as Public Anger Simmers
HONG KONG-Local authorities across China are paring back some of their strictest Covid-19 control measures, just days after public anger spilled over into rare protests against a zero-tolerance approach that has kept the country largely isolated for three years.
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12-05-22 0622ET
