US ECONOMY & POLITICS

Election 2020: Push to Seize Edge in Presidential Count Begins – Wall Street Journal, 11/4/20

• With counting resuming in a handful of closely contested battleground states, President Trump prematurely claimed victory and former Vice President Joe Biden said he was on track for a win as the prospect of an extended, bitter battle for the presidency loomed.
• Ahead of the election, Mr. Biden held a wide lead in national polls, but battleground state polls had been tighter.
• Few polls, however, predicted such a close race.
• On a divided national map, the president won Ohio, Iowa, Texas and the key prize of Florida, while Mr. Biden flipped an electoral vote in a Nebraska congressional district and won Arizona, the first time the state has gone to a Democratic presidential candidate since 1996.
• The battlegrounds still outstanding included Michigan, Wisconsin and Pennsylvania—the Great Lakes states Mr. Trump narrowly won in 2016—along with North Carolina, Georgia and Nevada.
• Mr. Trump saw initial leads from Election Day voting in Michigan, Pennsylvania and Wisconsin tighten overnight, and disappear in the case of Wisconsin, as mail-in ballots were tallied.
• Meanwhile, Democrats worried about their narrow lead in Nevada, a state many had expected would go blue, even as Mr. Biden’s campaign expressed confidence in a win there.
• The president led in Georgia and North Carolina, but the outcomes there remained too close to call.

Republicans Win Senate Seats in Texas, Iowa; Democrats Flip Colorado, Arizona – Wall Street Journal, 11/4/20

• Republicans scored key Senate victories in Tuesday’s elections, with wins in Iowa and Alabama, while Democrats flipped two seats, with former Democratic Gov. John Hickenlooper unseating incumbent GOP Sen. Cory Gardner in Colorado, and Democrat Mark Kelly, a former astronaut, toppling Republican Sen. Martha McSally in Arizona, the Associated Press projected.
• In the early hours of Wednesday morning, AP projected that Iowa’s incumbent GOP Sen. Joni Ernst had defeated Democratic challenger Theresa Greenfield, a Des Moines businesswoman.
• Republicans picked up a seat by ousting Democratic Sen. Doug Jones in deep red Alabama, with Tommy Tuberville, the Republican candidate and former Auburn head football coach, winning.
• Control of the chamber still remains in doubt as a number of other GOP-held races hang in the balance.
• Democrats now have a net gain of one seat.
• They need to gain three seats to win a majority if Democrat Joe Biden wins the White House or four if President Trump wins re-election.
• The races in North Carolina and Georgia were too close to call, and the outcomes in Michigan and Maine were uncertain.
• The Democrats’ opportunities to pick off seats dwindled as the vote counting deepened.
• In Maine, analysts gave Republican Sen. Susan Collins an edge over Democrat Sara Gideon, with slightly more than 10% of precincts uncounted as of Wednesday morning, saying she had outperformed in rural areas.
• In Montana, Democratic Gov. Steve Bullock lost his challenge to Republican Sen. Steve Daines, the AP said.

GOP Lawsuit in Pennsylvania Questions Validity of Some Mail-In Ballots – Wall Street Journal, 11/4/20

• Pennsylvania Republicans planned to ask a judge Wednesday morning to block the counting of some mail-in ballots in a key Philadelphia suburb as the presidential election hinged on late results in the state and a few other battlegrounds.
• The race for president has yet to be called in Pennsylvania, and the state’s top election official, Secretary of the Commonwealth Kathy Boockvar, said she expected most of the state’s votes would be counted by Friday.
• The lawsuit, filed by Republicans in federal court Tuesday, contends that Montgomery County elections officials were illegally sorting through and identifying problems with about 1,200 ballots received before Election Day.
• A hearing was set for Wednesday morning in Philadelphia.

U.S. private payrolls growth slows in October: ADP – Reuters, 11/4/20

• U.S. private payrolls increased less than expected in October, providing an early sign of a slowdown in economic activity as fiscal stimulus diminishes and new COVID-19 infections surge across the country.
• Private payrolls increased by 365,000 jobs last month, the ADP National Employment Report showed on Wednesday.
• Data for September was revised up to show 753,000 jobs added instead of the initially reported 749,000.
• Economists polled by Reuters had forecast private payrolls would rise by 650,000 in October.

U.S. factory orders rise solidly; outlook uncertain – Reuters, 11/3/20

• New orders for U.S.-made goods increased solidly in September, but further gains could be limited amid an anticipated slowdown in consumer spending as government money for businesses and workers impacted by the COVID-19 pandemic runs out.
• The Commerce Department said on Tuesday that factory orders rose 1.1% after climbing 0.6% in August.
• Economists polled by Reuters had forecast factory orders would rise 1.0% in September.
• Unfilled orders at factories fell 0.2% in September after declining 0.6% in August. Inventories at factories were unchanged for a second straight month, while shipments of manufactured goods rose 0.3%.
• Shipments of core capital goods, which are used to calculate business equipment spending in the GDP report, rose 0.5%. They were previously reported to have gained 0.3%.

U.S. Trade Deficit Narrowed in September as Exports Rose – Wall Street Journal, 11/4/20

• The U.S. trade deficit narrowed in September as exports continued to recover from the global economic downturn caused by the coronavirus pandemic while imports slowed.
• The U.S. posted a deficit of $63.86 billion in September, compared with $67.04 billion in August and $47.84 billion a year earlier, the Commerce Department said Wednesday.
• Exports rose 2.6% to $176.35 billion, while imports rose 0.5% to $240.22 billion, their slowest pace of growth since trade bottomed out in May.
• U.S. purchases of consumer goods from abroad fell 3.6% from August to $55.77 billion, the first monthly decline since April, led by a sharp drop in imports of cellphones and other household goods.

U.S. service sector cools in October – ISM survey – Reuters, 11/4/20

• U.S. services industry activity slowed in October, with growth in new orders and employment moderating, likely reflecting concerns about ebbing fiscal stimulus and a resurgence in new COVID-19 cases across the nation.
• The Institute for Supply Management (ISM) said on Wednesday its non-manufacturing activity index fell to a reading of 56.6 last month from 57.8 in September.
• The ISM survey’s measure of new orders for the services industry dropped to a reading of 58.8 in October from 61.5 in September. But backlog orders and export orders increased last month.
• The survey’s index of services industry employment slipped to 50.1 from a reading of 51.8 in September.

EUROPE & WORLD

Covid-19 Surge Forces Europeans to Stay Home, Dragging on Economy  – Wall Street Journal, 11/4/20

• Europe’s service providers reported a fresh decline in activity as a surge in coronavirus infections in October pushed consumers to avoid face-to-face services ranging from entertainment to eating out, a contrast with Asian countries such as China, which continued to see a rebound.
• Data firm IHS Markit said its services Purchasing Managers Index for the eurozone fell to 46.9 in October from 48.0 in September.
• Spain saw the largest drop in activity during October. Figures released Tuesday by the country’s statistics agency showed how severely its key tourism sector has been hit by the pandemic, with spending by foreign visitors in the first nine months of the year down 89.9% on the same period in 2019.
• A similar survey of Chinese service providers painted a very different picture. With the spread of the coronavirus largely contained, service providers reported the second-largest increase in activity for a decade, with the PMI rising to 56.8 from 54.8 in September.
• In India, where restrictions have been eased even as infections remain high, service providers reported an increase in activity for the first month since February, as the PMI rose to 54.1 from 49.8.

SK Hynix expects soft server demand after third-quarter profit surge – Reuters, 11/3/20

• SK Hynix, the world’s No.2 memory chip maker, said it expected inventory build-up by Huawei’s competitors in China to boost mobile demand in the current quarter, but its mainstay server demand would remain week.
• The chipmaker reported third-quarter operating profit of 1.3 trillion won ($1.2 billion), up from 473 billion won a year earlier as Huawei’s rush of orders before U.S. restrictions offset weak server demand.
• DRAM chips took up 72% of SK Hynix’ total revenue in the third quarter, and about 40% of that was server DRAM, according to its earnings document.
• The South Korean company, which counts Apple and Huawei among its customers, said Chinese smartphone vendors were building up inventory to gain market share as Huawei faced U.S. restrictions.
• The market for server chips however would remain difficult until customers begin to stock up again later this quarter or early next year, it added.

BMW Sales Boosted by China’s Strong Covid-19 Recovery – Wall Street Journal, 11/4/20

• BMW, the German luxury car maker, reported strong growth in profits and new vehicle sales in the third quarter, as China’s robust recovery from the pandemic continues to bolster premium auto brands.
• Revenue for the group dropped to €26.28 billion from €26.67 billion.
• The sale of BMW-branded vehicles rose 9.8% in the third quarter, driven by a 31% surge in sales in China, which helped dull the effect of a 16% drop in U.S. sales.
• In China, sales of new BMW, Rolls-Royce, and Mini brands rose 6.4% to 560,367 vehicles, a record for the Munich-based auto maker.
• In the nine months to Sept. 30, BMW’s overall new vehicle sales fell 12.5% to 1.64 million vehicles, pulled down by a 25% drop in U.S. sales and a 20% decline in Europe.
• BMW’s net profit rose to €1.79 billion, equivalent to $2.1 billion, in the quarter, from €1.52 billion a year earlier.

Factmonster – TODAY in HISTORY

• Howard Carter discovered the tomb of Tutankhamen in Egypt. (1922)
• The American embassy in Tehran, Iran, was seized by militants and 90 Americans were taken hostage. (1979)
• Democratic senator Barack Obama wins the presidential election against Sen. John McCain, taking 338 electoral votes to McCain’s 161. Obama becomes the first African American to be elected president of the United States. (2008)