China's economic growth hits 30-year low - BBC News

China's economy grew last year at the slowest pace in almost three decades.

Official figures show that the world's second largest economy expanded by 6.1% in 2019 from the year before - the worst figure in 29 years.

The country has faced weak domestic demand and the impact of the bitter trade war with the US.

The government has been rolling out measures over the past two years in an attempt to boost growth.

It comes after almost two years of trade tensions with the US - although hopes of a better relationship with America have seen improvements in manufacturing and business confidence data.

This week Washington and Beijing signed a "phase one" trade deal. However, analysts remain unsure whether those recent gains will continue.

In response to the lower growth rate, Beijing is now widely expected to roll out yet more stimulus measures.

The government has used a combination of measures aimed at easing the slowdown, including tax cuts and allowing local governments to sell large amounts of bonds to fund their infrastructure programmes.

The country's banks have also been encouraged to lend more, especially to small firms. New loans in the local currency hit a record high of $2.44 trillion (£1.86tn) last year.

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So far the economy has been slow to pick up, with investment growth falling to record low levels.

Historically, China has seen much stronger economic expansion, with the first decade of the 21st Century seeing double-digit percentage growth.

But - although that 6.1% growth rate is China's weakest expansion in almost three decades - it is much higher than other leading economies.

The US central bank, for example, has forecast that the American economy will grow by around 2.2% this year.

'The trade war may have actually helped the Chinese economy'

Analysis by Stephen McDonell, BBC China correspondent

For many countries, having the slowest GDP growth in three decades might cause panic - but not in China.

Softening domestic demand and US tariffs have eaten into growth - but some analysts argue that the trade war may have actually helped the Chinese economy.

This 6.1% GDP figure for 2019 is not only within the government's target range, but Chinese policy makers have for years been trying to gradually step down expectations.

They're trying to break away from the years of unsustainable breakneck growth which has trashed the natural environment and led to an explosion in unserviceable debt.

The government has instigated some stimulus measures to make sure the steam doesn't come out of the economy too quickly. But on bank loans, the crucial question will be - who gets access to the loans?

Will it be those building the "bridge to nowhere" vanity projects which have popped up in many regional cities?

Or will it be the promising new start-up enterprises which are seen as the future of modern Chinese development?

As part of the phase one deal, China pledged to boost US imports by $200bn above 2017 levels and strengthen intellectual property rules.

In exchange, the US agreed to halve some of the new tariffs it has imposed on Chinese products.

Speaking in Washington, US President Donald Trump said the pact would be "transformative" for the American economy.

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2020-01-17 05:06:38Z
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China's economic growth hits 30-year low - BBC News

China's economy grew last year at the slowest pace in almost three decades.

Official figures show that the world's second largest economy expanded by 6.1% in 2019 from the year before - the worst figure in 29 years.

The country has faced weak domestic demand and the impact of the bitter trade war with the US.

The government has been rolling out measures over the past two years in an attempt to boost growth.

It comes after almost two years of trade tensions with the US - although hopes of a better relationship with America have seen improvements in manufacturing and business confidence data.

This week Washington and Beijing signed a "phase one" trade deal. However, analysts remain unsure whether those recent gains will continue.

In response to the lower growth rate, Beijing is now widely expected to roll out yet more stimulus measures.

The government has used a combination of measures aimed at easing the slowdown, including tax cuts and allowing local governments to sell large amounts of bonds to fund their infrastructure programmes.

The country's banks have also been encouraged to lend more, especially to small firms. New loans in the local currency hit a record high of $2.44 trillion (£1.86tn) last year.

Media playback is unsupported on your device

So far the economy has been slow to pick up, with investment growth falling to record low levels.

Historically, China has seen much stronger economic expansion, with the first decade of the 21st Century seeing double-digit percentage growth.

But - although that 6.1% growth rate is China's weakest expansion in almost three decades - it is much higher than other leading economies.

The US central bank, for example, has forecast that the American economy will grow by around 2.2% this year.

'The trade war may have actually helped the Chinese economy'

Analysis by Stephen McDonell, BBC China correspondent

For many countries, having the slowest GDP growth in three decades might cause panic - but not in China.

Softening domestic demand and US tariffs have eaten into growth - but some analysts argue that the trade war may have actually helped the Chinese economy.

This 6.1% GDP figure for 2019 is not only within the government's target range, but Chinese policy makers have for years been trying to gradually step down expectations.

They're trying to break away from the years of unsustainable breakneck growth which has trashed the natural environment and led to an explosion in unserviceable debt.

The government has instigated some stimulus measures to make sure the steam doesn't come out of the economy too quickly. But on bank loans, the crucial question will be - who gets access to the loans?

Will it be those building the "bridge to nowhere" vanity projects which have popped up in many regional cities?

Or will it be the promising new start-up enterprises which are seen as the future of modern Chinese development?

As part of the phase one deal, China pledged to boost US imports by $200bn above 2017 levels and strengthen intellectual property rules.

In exchange, the US agreed to halve some of the new tariffs it has imposed on Chinese products.

Speaking in Washington, US President Donald Trump said the pact would be "transformative" for the American economy.

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2020-01-17 04:45:21Z
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US retail sales climb in December, and November sales were revised up - CNBC

U.S. retail sales rose for a third straight month in December, with households buying a range of goods even as they cut back on purchases of motor vehicles, which could strengthen the view that the economy maintained a moderate growth pace at the end of 2019.

The Commerce Department said on Thursday retail sales increased 0.3% last month. Data for November was revised up to show retail sales gaining 0.3% instead of rising 0.2% as previously reported. Economists polled by Reuters had forecast retail sales would gain 0.3% in December. Compared to December last year, retail sales accelerated 5.8%.

Excluding automobiles, gasoline, building materials and food services, retail sales jumped 0.5% last month after falling by a downwardly revised 0.1% in November.

The so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously reported to have edged up 0.1% in November.

Sales rose in December despite retailers such as Target Corp , Kohl's, J.C. Penney and Macy's reporting a decline in sales for the holiday period as foot traffic in malls dropped.

Though a report last week showed a slowdown in job growth in December and the increase in the annual wage gain retreating to below 3.0%, consumers will continue to shoulder the longest economic expansion on record, now in its 11th year, thanks to higher savings, rising house prices and a bullish stock market.

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, grew at a 3.2% annualized rate in the third quarter. Growth in consumer spending is expected to have slowed to around or below a 2.5% rate in the fourth quarter. The economy expanded at a 2.1% pace in the July-September period.

Growth estimates for the fourth quarter are as high as a 2.5% rate, in part because of a drop in imports, which compressed the trade deficit.

In December, auto sales fell 1.3%, the biggest drop since last January, after increasing 1.5% in November. Higher gasoline prices lifted receipts at service stations, which jumped 2.8%. Online and mail-order retail sales rose 0.2% after being unchanged in November.

Sales at electronics and appliance stores rebounded 0.6% in December. Receipts at building material stores surged 1.4% and sales at clothing stores accelerated 1.6%. Spending at furniture stores edged up 0.1%.

Americans also spent more at restaurants and bars, with sales rising 0.2% last month. Spending at hobby, musical instrument and book stores rebounded 0.9%.

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2020-01-16 13:30:00Z
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America's favorite Valentine's Day candy is back, but not without a few hiccups - CNBC

Sweetheart candy hearts are seen on the shelf at the To The Moon Marketplace on January 29, 2019 in Wilton Manors, Florida.

Joe Raedle | Getty Images

Sweethearts, the conversation heart candy, is back on shelves for Valentine's Day after missing a year because of a change in its ownership.

But consumers might notice a few changes — fewer pithy sayings and a slightly different taste — and they won't be quite as ubiquitous.

Sweethearts' original producer, New England Confectionary Company, went out of business in 2018. Round Hill Investments, which bought Twinkie-maker Hostess while it was in bankruptcy proceedings, purchased the bankrupt candy maker at auction but sold its Necco wafer brand and Sweethearts to Spangler Candy several months later. Spangler's best-known candy is its Dum Dum lollipops.

Because the candy company acquired the brands in the fall of 2018, it was unable to produce Sweethearts in time for Valentine's Day just a few months later even though it was the most popular candy for the holiday in 2018.

"It became really apparent to us how much people were going to miss them," Spangler spokeswoman Diana Moore Eschhofen said.

The long-moving process for transferring the Sweethearts' equipment from Necco's shuttered factory in Revere, Massachusetts, into another plant resulted in the delay, she said. Sixty truckloads of equipment had to be carefully dismantled, packed up and moved. Some larger pieces needed to be lifted out through the roof with a crane.

The entire moving process took about a year, according to Eschhofen. And those challenges are still putting pressure on Spangler's ability to deliver the candy hearts this year.

"Based on consumer response and the technical challenges, we are not going to be able to meet all of the consumer demand for 2020," she said.

The best place to find Sweethearts for Valentine's Day will be nationwide drugstores like CVS and Walgreens, according to Eschhofen. Some regional stores may also carry them, but they will be in limited supply. The goal for 2021 is to return to Sweethearts' normal production capacity.

The equipment also caused another headache for Spangler. The printer that Sweethearts used to press sayings like "you rock" and "love me" on the hearts was unreliable. The company decided to invest in a new printer, but the replacement printing equipment was damaged during production, and Spangler could not get it fixed completely.

For consumers, that means more conversation hearts than usual will be silent.

"We know that's disappointing, but it's a disappointment for us, too," Eschhofen said.

Although fewer Sweethearts will come with the sayings that they are known for, Spangler is bringing the candy back to its roots by reviving the original recipe. The company located the formula buried in paperwork. Necco had tweaked the recipe over the years in an attempt to modernize the 118-year-old candy. The change brings back flavors such as banana and wintergreen.

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2020-01-16 12:41:00Z
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Morgan Stanley shares jump after massive beat on fourth-quarter profit - CNBC

Morgan Stanley shares popped after the firm exceeded analysts's profit estimates and each of its three main businesses produced more revenue than expected. 

The bank said Thursday that fourth-quarter profit surged 46% to $2.24 billion, or $1.30 a share, compared with the 99 cent estimate of analysts surveyed by Refinitiv. Revenue climbed 27% to $10.86 billion, exceeding the $9.72 billion estimate by more than $1 billion.

Shares of the firm rose 2.7% in premarket trading. 

"We delivered strong quarterly earnings across all of our businesses," CEO James Gorman said in the release. "Firmwide revenues were over $10 billion for the fourth consecutive quarter, resulting in record full year revenues and net income. This consistent performance met all of our stated performance targets."

In a quarter in which competitors from J.P. Morgan Chase to Goldman Sachs posted huge rebounds to fixed income trading revenue, analysts wanted to see if Morgan Stanley would follow suit. 

It did: Bond trading helped power the firm's institutional securities division to a 32% jump in revenue to $5.05 billion, compared to the $4.46 billion estimate.

At the firm's massive wealth management division, revenue rose 11% to $4.58 billion, edging out the $4.39 billion estimate. 

But it was

Gorman has tilted Morgan Stanley towards wealth management and overhauled its once-struggling bond trading division. But the trading and advisory operations are still a crucial part of the company's business mix.

Last month, Morgan Stanley cut roughly 2% of its workforce due to an uncertain global economic outlook, a cull that hit technology and operations roles the hardest, people with knowledge of the matter said.

Morgan Stanley is the last of the six largest U.S. banks to report results.

Earlier this week, J.P. Morgan, Citigroup, and Bank of America posted profits that beat analysts' expectations on surging bond-trading results. Results at Wells Fargo and Goldman Sachs were both marred by legal expenses tied to scandals: At Wells, legal charges were tied to its fake accounts issue, while Goldman neared a resolution to its 1MDB investigation.

Here's what Wall Street expected:

Earnings: 99 cents a share, 24% higher than a year earlier, according to Refinitiv

Revenue: $9.72 billion, 14% higher than a year earlier

Wealth management: $4.39 billion, according to FactSet

Trading: Equities $1.93 billion, Fixed Income $933.5 million

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2020-01-16 11:55:00Z
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Carlos Ghosn's Japanese lawyers quit after former Nissan chief absconds - Yahoo Finance

FILE PHOTO: Junichiro Hironaka, former lawyer for ousted Nissan boss Carlos Ghosn, speaks at a news conference in Tokyo

By Tim Kelly

TOKYO (Reuters) - Japanese attorneys representing Carlos Ghosn, including lead lawyer Junichiro Hironaka, quit on Thursday following the former Nissan chief's flight to Lebanon from Japan, where he had been fighting financial misconduct charges.

In an emailed statement, Hironaka said that everyone involved in the case at his practice had resigned. A spokeswoman there declined to give a reason.

A second lawyer in Ghosn's three-person legal team, Takashi Takano, also quit on Thursday, according to an official at his office.

A person who answered the phone at the office of the third lawyer, Hiroshi Kawatsu, said she didn't know if he still represented the former automotive executive.

Ghosn, who fled from Tokyo last month, told Reuters in an interview in Beirut with his wife Carole on Wednesday that he was happy to stay in Lebanon for the rest of his life and claimed he was treated with "brutality" during his detention and bail in Japan. Carole said she was "done with Japan."

Japan has issued international wanted notices for the couple, which means the two will live in Lebanon as fugitives and could be arrested if they leave their country. Japan's Justice Minister Masako Mori has described Ghosn's criticism of her country's judicial system as "absolutely intolerable."

Hironaka, who earlier expressed disappointment at his client's decision to abscond, had said he would quit once his client had settled his account.

Hired by Ghosn in February, the 74-year-old lawyer is known for his combative style. He has been called the "Razor" after winning high-profile cases, including the acquittal of a senior lawmaker on financial misconduct charges and the exoneration of a bureaucrat jailed for four months on corruption charges fabricated by prosecutors.

(Reporting by Sam Nussey and Tim Kelly; Editing by Muralikumar Anantharaman and Raju Gopalakrishnan)

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2020-01-16 05:26:56Z
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Bank of America beats analysts' profit estimate on rebound in bond-trading revenue - CNBC

Bank of America on Wednesday posted profit that exceeded analysts' expectations on a rebound in trading revenue and as the company repurchased shares.

The bank said fourth-quarter profit was $7 billion, a 4% decline from a year earlier. But earnings per share were 74 cents, an unexpected 6% increase, helped by a reduction in outstanding shares. That exceeded the 68 cent estimate of analysts surveyed by Refinitiv. Revenue fell 1% to $22.5 billion, edging out the $22.35 billion estimate.

"In a steadily growing economy marked by solid client activity, our teammates produced another strong quarter and year, allowing us to increase investments in our customers, communities, and employees," CEO Brian Moynihan said in the release. "We also delivered for shareholders in 2019 by returning a record $34 billion in excess capital through dividends and share repurchases."

The stock was slightly lower in Wednesday's premarket.

Of the bank's three main divisions, only its global markets business posted a quarterly increase in profit. The Wall Street trading division had a 13% increase in earnings to $574 million as bond trading revenue surged 25% to $1.8 billion, exceeding the $1.68 billion estimate. Stock trading produced $1 billion in revenue, a 4% decline and just under the $1.07 billion estimate.

The impact of lower interest rates was felt widely at Bank of America, impacting its core lending and banking operations. Companywide net interest income fell 3% to $12.3 billion, and the bank's net interest margin fell 17 basis points to 2.35%, just under analysts' 2.36% estimate.

At the lender's giant retail bank, profit dropped 10% to $3.1 billion on the impact of lower rates. The company also cited interest rates as a reason for lower revenue in its global banking and wealth management divisions.

The second-biggest U.S. lender after J.P. Morgan Chase is among the most sensitive of large banks when it comes to changes in interest rates, according to analysts. So investors will want to hear how rates — which were cut three times last year by the Federal Reserve — impacted the quarter, as well as guidance for 2020.

Last month, Moynihan said that the U.S. economy remained strong as consumer spending continued to grow. He also said that fourth-quarter trading revenue is expected to climb 7% to 8% from a year earlier (his guidance proved conservative — trading revenue actually climbed 13% in the quarter) and that investment banking revenue was headed 3% to 4% higher.

Shares of the bank surged more than 40% last year, exceeding the 29% gain in the Standard & Poor's 500.

On Tuesday, J.P. Morgan and Citigroup posted profits that beat analysts' expectations on surging bond-trading results and strong revenue from credit-card operations. Wells Fargo missed analysts' profit estimates as it booked costs tied to its fake accounts scandal.

Here's what Wall Street expected for Bank of America:

Earnings: 68 cents a share, a 2.3% decline from a year earlier, according to Refinitiv.
Revenue: $22.35 billion, a 2.4% decline from a year earlier.
Net Interest Margin: 2.36%, according to FactSet
Trading Revenue: Fixed Income $1.68 billion, Equities $1.07 billion

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2020-01-15 11:39:00Z
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