SPY380.36-1.97 -0.52%
DIA309.45-4.53 -1.44%
IXIC13,192.35+72.96 0.56%

DJ The 10-Point: The Wall Street Journal's Guide to the Day's Top News

· 02/05/2021 07:29
By Matt Murray

Good Morning. In today's edition, semiconductor shortage hits another car maker, House strips Rep. Marjorie Taylor Greene of committee assignments, miner Vale agrees to pay $7 billion over Brazil dam collapse that killed hundreds, and President Biden announces foreign-policy shifts.

A global semiconductor shortage is expected to cut Ford's vehicle output by up to 20% in the first quarter, the company said Thursday, a day after GM said the shortage would force it to pause production for a week at three North American factories. Ford said its fourth-quarter earnings were dented by lower truck output, and vowed to nearly double investment in electric and driverless cars. Electric vehicles made up 31% of Volvo's new car sales last year in the EU, which has roared past China as the top plug-in market.

In other business news...

-- Kia has approached potential partners about a plan to assemble Apple's long-awaited electric car in Georgia.

-- UnitedHealth CEO David Wichmann retired abruptly, with company President Andrew Witty succeeding him. Merck said CEO Kenneth Frazier will retire at the end of June.

-- High levels of toxic metals were found in several top baby-food brands, a congressional investigation found.

-- Rolling Stone magazine has signed a multiyear deal to produce original videos with Amazon's gaming service, Twitch.

U.S. Rep. Marjorie Taylor Greene was removed from her committee assignments by a House vote Thursday, sidelining the Georgia Republican just weeks into her first term in office. Hours before the vote, Mrs. Greene said she regretted her past embrace of conspiracy theories.

The Senate approved a budget plan for President Biden's $1.9 trillion relief package, after Republicans offered amendments meant to put Democrats on the spot on issues including the minimum wage and school reopenings. The 50-50 Senate operates under partisan pressures that, by one measure, are greater than ever.

-- Former President Donald Trump spurned a request that he testify at his impeachment trial next week.

-- Voting-machine company Smartmatic sued Fox News for over $2.7 billion over on-air comments about its products.

Driving down unemployment has become the overriding economic goal of top U.S. policy makers.

The jobless rate stalled at 6.7% in December and November after a rapid descent from double-digit levels last spring. A Labor Department report today will show whether the economy is picking up from a winter slowdown. Economists expect payrolls grew slightly in January but the jobless rate didn't budge. Just a year ago, it was at 3.5%, a low not seen in decades -- and the Fed and Biden administration want it back there as soon as possible.

The S&P 500 rose 1.1% to a record Thursday after news that weekly jobless claims declined from the previous week. The Dow industrials also gained 1.1%; the Nasdaq, 1.2%. In global trading Friday, Asian markets mostly ended with gains, Europe was mostly higher at midday and U.S. stock futures were up.

-- President Biden's pick for Labor secretary, Boston Mayor Marty Walsh, is a champion of organized labor.

Credit Suisse overlooked red flags for years while a rogue private banker stole from billionaire clients, according to a report for Switzerland's financial regulator. It says the activities of Patrice Lescaudron -- sentenced to five years in prison in 2018 for fraud and forgery -- triggered hundreds of alerts in the bank that weren't fully probed. In addition, some dozen executives or managers knew he repeatedly broke rules, but turned a blind eye.

In other financial news...

-- GPB Capital and three men tied to the private-equity firm face charges over a $1.7 billion Ponzi-like arrangement.

-- Last year's first-time traders are learning that a lot of buying and selling means a lot of tax consequences.

-- Greek-yogurt maker Chobani is considering an IPO this year valuing it at $7 billion to $10 billion.

-- Genetics startup 23andMe is teaming up with a blank-check company backed by Richard Branson's Virgin Group to go public in a deal valuing it at $3.5 billion.

Brazilian miner Vale agreed to pay $7 billion in compensation to the state of Minas Gerais, where the collapse of its dam two years ago killed 270 people, polluted rivers and obliterated the surrounding landscape. The miner's shares, up about 60% since the disaster in the city of Brumadinho, initially rose after news of the settlement, signaling investors' hopes that the company can finally move past the disaster.

From reporter Samantha Pearson:

The settlement, though roughly 200 times Brumadinho's annual budget, isn't sufficient for many grieving residents whose loved ones were crushed by an avalanche of rocky mud. The real test of Brazil's justice system, they say, will be whether anyone actually goes to jail. Criminal charges against former Vale executives and directors are still pending.

samantha.pearson@wsj.com

-- Brazil's history of corruption, inequality and deforestation makes it a challenge to attract investors focused on environmental, social and governance issues.

President Biden issued sharp warnings over developments in Russia and Myanmar, and declared several policy shifts, including an increase in refugee admissions and a freeze on troop withdrawals from Germany. In his first foreign-policy speech as president, Mr. Biden reaffirmed Saudi Arabia as a key partner, but said the U.S. would end support for Saudi-led military operations in Yemen. He also named veteran diplomat Timothy Lenderking as a special envoy for Yemen, seeking a diplomatic resolution.

Fewer students are in school, remotely or in person

Limited data shows those learning remotely -- especially students of color and special-needs and elementary-school students -- attending less often than in-school classmates. President Biden is pushing to reopen schools, but standing in the way are new fast-spreading coronavirus strains, a slow vaccination rollout, uncertainty over economic-relief legislation and clashes between school districts and teachers' unions.

-- Some groups are lobbying to jump the vaccine queue.

-- Many older adults say the vaccination system is confusing and overloaded.

-- The guidance around masks is changing.

(END) Dow Jones Newswires

February 05, 2021 07:29 ET (12:29 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.