U.S. Stocks Extend Thursday Gains After Jobs Report – Wall Street Journal, 1/8/2021

• Stocks rose Friday after the monthly employment report showed the U.S. lost jobs in December as investors continued to look ahead to the prospect of additional fiscal stimulus.
• All three indexes closed Thursday at records as investors focused on the potential for more government spending after victories in runoff races in Georgia that will give Democrats control of the U.S. Senate.
• In the meantime, the surging coronavirus pandemic continues to weigh on the economy.
• The Labor Department report Friday showed the U.S. shed 140,000 jobs in December, ending seven months of job growth.
• Stocks have rallied this week despite the political unrest in Washington. Investors have largely focused on the likelihood of additional spending by President-elect Joe Biden’s administration after the elections in Georgia.
• The fresh stimulus measures are expected to provide crucial support to American households and businesses as the coronavirus pandemic restricts work and social activity in the winter months.
• In a video Thursday night, President Trump acknowledged that he lost the presidential election. He has also pledged that there will be an orderly transition of power on Jan. 20.
• This has reduced uncertainty and removed a major political risk, investors said.

Coronavirus Live Updates: U.S. Deaths Set New Record as Cases Surge – Wall Street Journal, 1/8/2021

• The U.S. set a new single-day record for reported deaths associated with Covid-19, and newly reported infections hit their second-highest day on record, surpassed only by a day on which data backlogs artificially inflated the figure.
• The nation reported more than 4,000 deaths on Thursday, according to data compiled by Johns Hopkins University. It was the third record-high day in a row, and the first time the daily figure has surpassed 4,000.
• The U.S. also reported more than 274,000 new cases for Thursday, according to Johns Hopkins data.
• It was the second-highest day on record after Jan. 2, when many states reported extra cases after not reporting any on New Year’s Day.
• Thursday’s figure was an increase from Wednesday’s 249,735, which had been the second-highest day on record after Jan. 2.
• Hospitalizations in the U.S. were at 132,370 on Thursday, according to the Covid Tracking Project, down slightly from a day earlier after four record-high days in a row.
• A record 23,821 people were in intensive care units, the project reported.
• More states are reporting instances of a new, more-contagious strain of the virus. Connecticut health officials said they detected the variant, first discovered in the U.K., in two people who live in New Haven County.
• Texas, which has recorded the second-highest number of infections of any state since the pandemic began, also reported an instance of the new strain. The case was detected in an adult male resident of Harris County who had no history of travel, according to the Texas Department of State Health Services.
• China’s health authorities reported 37 locally transmitted cases with symptoms on Thursday, with one in Beijing, 33 in Hebei province, which rings the capital city, and the remainder in the country’s northeast.
• China’s capital and its northeastern region have been on high alert after new locally transmitted cases emerged in December, while Hebei has reintroduced draconian measures to curb a rapidly developing outbreak with more than 200 cases reported since Jan. 2.
• Shijiangzhuang, the capital of Hebei that is the hardest-hit city in this latest round, has imposed a travel ban, forbidding people and cars from leaving the city and initiating a massive campaign to test its 11 million residents.

Covid-19 Crisis Forces California Hospitals to Plan Who Gets Life-Saving Care – Wall Street Journal, 1/8/2021

• Overwhelmed California hospitals raced this week to complete crisis-care plans that give priority to which patients get care when there aren’t enough staff, supplies and lifesaving equipment, raising concerns that the inconsistent criteria across hospitals will lead to disparities for patients.
• Four hospitals have approached or hit the crisis point before getting state help, California’s Department of Public Health said.
• Hospitals and public officials said they are working to avoid reaching a crisis state by moving people or support where they are needed. But the surge has pushed some hospitals near or to their limits.
• Shortages of critical supplies are acute; Los Angeles County, for example, told ambulance crews on Monday to conserve oxygen given to patients.

Micron forecasts second-quarter revenue above estimates – Reuters, 1/7/21

• Micron Technology on Thursday forecast second-quarter revenue above Wall Street estimates as a global shift to remote work and a recent uptick in 5G smartphone adoption drove demand for its chips.
• The company’s revenue for the first quarter rose about 12% to $5.77 billion, beating estimates of $5.73 billion.
• Excluding items, the company earned 78 cents per share, above estimates of 71 cents per share.
• Micron struggled with low prices for its chips over the past year because of an abundance of supplies, but Chief Executive Sanjay Mehrotra said supplies are expected to tighten in 2021 as the global economy recovers from the pandemic.
• “We are past the bottom, and the industry is in tight supply across major market segments,” he told investors on a conference call.
• The chipmaker expects current-quarter revenue of $5.8 billion, plus or minus $200 million, while analysts on average were expecting $5.50 billion, according to IBES data from Refinitiv.

Blacklisted Chinese Telecoms Carriers Cut from Stock Indexes – Wall Street Journal, 1/8/2021

• Shares in China’s three major telecommunications companies dropped in Hong Kong on Friday, after index compilers said they would remove the stocks from their benchmarks due to a U.S. government investment ban.
• The removals come after a period of uncertainty about whether the shares would be covered by the ban and flip flops by the New York Stock Exchange about whether to delist American depositary receipts issued by the three companies, China Mobile, China Telecom and China Unicom (Hong Kong).
• Shares in the trio, which have been on a roller-coaster ride recently, fell as much as 10% to 11% in early trading, before recovering some ground.
• Some investors said the ban hurts U.S. shareholders, and they are concerned about whether other larger Chinese companies like Alibaba will also be blacklisted.
• The Wall Street Journal has reported that U.S. officials are considering adding Alibaba and Tencent to the list.

Long-Term Bonds Hit Hard After Georgia Senate Runoffs – Wall Street Journal, 1/8/2021

• Democratic victories in the Georgia Senate races this week have spurred investors to bet on a higher spending government that will bring growth and inflation to the U.S. economy.
• That view has shown up most spectacularly in the sharp rise in Treasury yields, especially among longer-dated bonds.
• The 30-year Treasury yield has jumped by more than one-fifth of 1 percentage point since the start of the year to hit 1.855% early Friday morning, according to Tradeweb.
• The 10-year Treasury yield has also risen, breaching the 1% level for the first time also since the market dysfunction in March.
• The sharp rise in Treasury yields has meant a poor return on the assets. The Bloomberg Barclays U.S. Treasury Bellwethers index shows 30-year bonds have returned minus 4.6% so far this year, according to FactSet.
• The returns on 10-year bonds is minus 1.5%.

Apple in Talks with Hyundai About Car Ambitions, Auto Maker Says – Wall Street Journal, 1/8/2021

• Apple has held talks with Hyundai about cooperation on driverless, electric vehicles, the South Korean car giant said.
• The brief statement, which sent Hyundai’s shares soaring early Friday in Seoul, included no details and said talks were preliminary but offered rare public confirmation of Apple’s car-related efforts.
• Hyundai, in saying Friday that it has held discussions with Apple, said that “as it is at [an] early stage, nothing has been decided.”
• In a later statement filed with Korean securities regulators, Hyundai said it had fielded requests of potential cooperation on electric vehicles from multiple companies.

Boeing Reaches $2.5 Billion Settlement of U.S. Probe Into 737 MAX Crashes – Wall Street Journal, 1/7/2021

• Boeing will pay $2.5 billion to resolve a Justice Department criminal investigation and admit employees deceived aviation regulators about safety issues that led to two deadly crashes of the 737 MAX, authorities said.
• The settlement includes a nearly $244 million fine as well as almost $2.3 billion in compensation to airline customers and families of the 346 people who perished in two MAX crashes.
• The plane maker was charged with one count of conspiracy to defraud the U.S. But it will avoid prosecution on that charge—allowing it to stay eligible for federal contracts—as long as it avoids legal trouble for a period of three years.
• The deal also calls for Boeing to comply with any ongoing investigations, including probes by foreign law-enforcement and regulatory authorities, and to beef up compliance programs, according to its settlement agreement.

Tesla launches cheaper variant of Model Y SUV – Reuters, 1/8/21

• Tesla launched a cheaper variant of the Model Y, bringing its sports utility vehicle’s price closer to that of its Model 3 sedan, the electric-car maker’s least expensive car.
• The new standard range Model Y is priced at $41,990, only $4,000 more than the entry level Model 3, according to the company’s website.
• Tesla’s new Model Y variants come days after the carmaker beat Wall Street targets for 2020 vehicle deliveries, driven by a steady rise in electric vehicle adoption, but narrowly missed its ambitious full-year target of half a million deliveries.

Federal Investigators Probing AmEx Card Sales Practices – Wall Street Journal, 1/7/2021

• Federal investigators are probing business-card sales practices at American Express.
• The inspectors general offices of the Treasury Department, Federal Deposit Insurance Corp. and Federal Reserve are investigating whether AmEx used aggressive and misleading sales tactics to sell cards to business owners and whether customers were harmed, the people said.
• They are also examining whether specific employees contributed to the alleged behavior and if higher-level employees supported it, some of the people said.
• The Office of the Comptroller of the Currency is also investigating business-card sales practices at AmEx, according to people familiar with the matter.

Roku Acquires Rights to Quibi’s Content – Wall Street Journal, 1/8/2021

• Roku agreed to acquire the rights to content from Quibi, a deal that will make the defunct short-form streaming service’s shows available on the biggest streaming-media player in the U.S.
• Roku paid less than $100 million to acquire the shows, according to people familiar with the matter. Roku will have the global distribution rights to Quibi’s content—more than 75 shows and documentaries—for the rest of 2021, the companies said Friday.
• Adding Quibi’s shows to the Roku Channel could give the streaming player more leverage in negotiations with advertisers, who may pay a premium to show their ads alongside shows viewers can’t watch elsewhere.

Acacia Communications Scraps Takeover by Cisco – Wall Street Journal, 1/8/2021

• Acacia Communications said it is scrapping a plan to sell itself to networking-equipment giant Cisco Systems for roughly $2.6 billion as the companies dispute the status of the Chinese government’s approval for the combination.
• Networking-equipment maker Cisco had agreed to buy Acacia, a Maynard, Mass.-based maker of optical interconnect technologies such as modules and semiconductors, in July 2019 for $70 a share, as Cisco sought to serve rising performance demands on networking gear from data-center operators and telecom-service providers.
• Cisco told Acacia it could dispute Acacia’s right to terminate the combination agreement, Acacia said, adding that the company plans to defend such claims.
• The San Jose, Calif.-based Cisco has come under the radar of Chinese government agencies for a blacklist that could be used to punish U.S. technology firms, in an effort by Beijing to respond to Washington’s restrictions on telecom giant Huawei’s access to U.S. components and technology, The Wall Street Journal reported in September.

Facebook Suspends Trump Indefinitely Amid Pressure on Social Media to Clamp Down – Wall Street Journal, 1/8/2021

• Facebook placed its harshest restrictions yet on President Trump, blocking him Thursday from posting indefinitely a day after the social media giant and its peers removed posts in the wake of the attack on the U.S. Capitol by a pro-Trump mob.
• Mark Zuckerberg said in a post that the ban on Mr. Trump would last at least two weeks—through the inauguration of President-elect Joe Biden —adding that the risks of his using the service during this period “are simply too great.”
• The ban, which applies to Facebook’s flagship blue app and Instagram, was initially due to last 24 hours when the company on Wednesday said it removed a video from Mr. Trump that reiterated unsubstantiated claims the election was stolen and expressed support for the protesters.
• Twitter reinstated Mr. Trump’s access to his personal account, which has more than 88 million followers, after he deleted three tweets that the company said represented “repeated and severe violations” of its civic integrity policy.