Updated throughout the day
January 6, 2016
The decline in oil is spilling over this week, dragging down stocks with it. The Dow Jones Industrial Average lost 1.5% Wednesday. The S&P 500 was down 1.3% and the Nasdaq dropped 1.1%. Weak demand for gas in December sent futures tumbling, pulling U.S. crude oil down 5.6% to $33.97/barrel, the lowest level for West Texas Intermediate since December 2008. Data for the day didn’t do much better. While the U.S. service sector did expand in December, it was at the slowest pace in 20 months. The Institute of Supply Management says the index for non-manufacturing activity fell to 55.3 from 55.9 in November. Add in the Saudi Arabia-Iran debacle and whatever North Korea is up to, and the world just can’t even right now.
Here’s what else you need to know:
UN promises new measures against North Korea. The hermit state carried out its fourth nuclear test as part of its “self-defense” against U.S. aggression, according to state television. The Pyongyang regime claims it successfully tested a miniaturized hydrogen nuclear device on Wednesday morning. The UN Security Council says the test is “a clear threat to international peace.” The U.S. says it doesn’t think North Korea actually blew up an H-bomb. The Guardian
Morgan Stanley wealth management head set to leave after he loses out on promotion. Colm Kelleher has been named president and top lieutenant to CEO James Gorman. Gregory Fleming, head of the wealth management unit, saw the promotion as a sign for him to leave. Fleming will “pursue other interests.” Wall Street Journal (paywall)
Pimco’s Total Return Fund posts $1.3 billion in inflows in December. These were the first inflows for the fund since April 2013. The fund held $89.9 billion at the end of December. Reuters
Netflix launching in 130 more countries. The streaming service will soon be available in almost every country, except China. Netflix CEO Reed Hastings says he’s hopeful China will get Netflix in its near future. The company is also adding Arabic, Korean, and traditional and simplified Chinese to its language options. The Guardian
Apple shares fall below $100. Apple shares traded as low as $99.87 Wednesday after news that its supplier in China was laying off workers in anticipation of slower iPhone sales. Apple shares haven’t closed below $100 since October 2014. Reuters
Nuveen Investments to acquire part of Incapital. Nuveen will purchase Incapital’s investment trust operation. The Chicago-based Incapital is run by Cubs Chairman Tom Ricketts. Crain’s Chicago Business
Starboard wants Marissa Mayer out. The activist investor says Yahoo should change its management, board, and business strategy. Starboard wants Yahoo to separate its Asian assets through a sale or spin-off. Reuters/NexChange
Malaysian Airlines bans luggage on European flights. The temporary ban is due to “unreasonably strong headwinds” making it difficult for the airlines to safely carry baggage in cargo. Strong headwinds cause more fuel usage than normal, and a lighter load reduces the speed of the fuel burn. CNN
ADP employment rises 257,000 in December. That’s well above the projected 198,000 for jobs in the private sector and bodes well for the December jobs report from Labor on Friday. Bloomberg
Howard Schiller named interim CEO at Valeant. The former CFO and board member will fill in for Michael Pearson, who was hospitalized last month and doesn’t appear to be recovering quickly. A three-person committee had been handling his duties. Valeant stock got crushed last quarter after a short-seller accused the pharmaceutical company of back-handed sales practices. Wall Street Journal (paywall)
You won’t believe this…
Tom Brady’s diet is the worst. The New England quarterback’s diet does not include nightshades like peppers and tomatoes over fear that they could cause inflammation. Also banned: caffeine. Business Insider
Hello from the other side of the puddle. More than 25,000 people are watching English pedestrians try to jump a puddle on Periscope. The comments and reactions to the ultimate British Wednesday is addicting. Fast Company
Photo: Hans Gerwitz