×

The daily business briefing: January 7, 2019

Harold Maass
A Tesla Model S in Shanghai
JOHANNES EISELE/AFP/Getty Images
The daily business briefing newsletter
Your free email newsletter subscription is confirmed. Thank you for subscribing!

1.

Trump, China express optimism as trade talks start

President Trump said Sunday that trade talks with China were going well and that data showing a weakening Chinese economy could be making Beijing more eager to reach a deal to end a trade war with the U.S. "I think China wants to get it resolved. Their economy's not doing well," Trump said. "I think that gives them a great incentive to negotiate." U.S. officials are meeting with Chinese counterparts in Beijing this week in the first face-to-face talks since Trump and Chinese President Xi Jinping agreed in December to a 90-day truce without any more of the rising tariffs that have upset global stocks. Just Friday, China cut bank reserve requirements in the government's latest attempt to address the threat of financial turmoil. [Reuters]

2.

Tesla breaks ground on China factory

Tesla broke ground Monday on its Shanghai Gigafactory as part of the electric-car maker's plan to localize production of vehicles to be sold in the world's biggest auto market. The factory, Tesla's first outside the U.S., will start production in China of its Model 3 and a planned crossover by the end of the year, CEO Elon Musk tweeted. "Affordable cars must be made on same continent as customers," Musk wrote on Twitter ahead of a ceremony at the plant site, where he joined the city's mayor and other local government officials. The Gigafactory is China's first wholly foreign-owned car plant. It reflects China's shift toward opening its car market even as it faces a trade war with the U.S. [The Associated Press, Reuters]

3.

Trump considers national-emergency declaration to get wall built

President Trump met Sunday with White House staff at Camp David to discuss his promised wall on the southern border, among other pressing topics. Trump's demand for $5.6 billion to help build the wall is the sticking point preventing a spending deal to end the partial government shutdown, now in its third week. The meeting came a day after two hours of negotiations led by Vice President Mike Pence failed to break the stalemate. In an effort to force Democrats to budge, Trump said he is considering a national emergency to free up money to start building the wall without congressional approval. "We're looking at a national emergency because we have a national emergency," Trump told reporters outside the White House as he returned Sunday evening. [The Washington Post, The Associated Press]

4.

Stocks struggle as investors look for trade-tension relief

U.S. stock index futures edged down early Monday as investors waited for concrete signs of progress from Chinese and U.S. officials who have expressed optimism ahead of trade talks this week. Futures for the Dow Jones Industrial Average vacillated between slight losses and gains in the hours ahead of the opening bell. Futures for the S&P 500 were down, but just barely. Nasdaq futures were down between 0.2 and 0.4 percent through the morning. Volatile markets got a boost on Friday from a blockbuster jobs report that showed that U.S. employers added 312,000 non-farm jobs in December, crushing expectations of 176,000 new jobs by economists surveyed by Dow Jones. The Dow gained 3.3 percent on Friday, while the broader S&P 500 rose by 3.4 percent, and the tech-heavy Nasdaq Composite surged by 4.3 percent. [CNBC]

5.

Park Service taps entrance fees to boost operations in shutdown

The National Park Service plans to use entrance fees to pay for work needed to keep facilities open and safe during the partial federal government shutdown, according to a memo signed by the Interior Department's acting secretary, David Bernhardt, that was obtained by The Washington Post. The move is unprecedented, and some say it could be illegal, because legally, admission money must be spent on visitor services, not general operations. During shutdowns under the Clinton and Obama administrations, the Park Service blocked access to the sites, but the Trump administration has kept them open with skeleton staffs. The memo said park managers now will be allowed to bring in more staff to clean restrooms, take away trash, and patrol park areas during the shutdown. [The Washington Post]