Business
America’s Department of Justice laid out its proposals for how to deal with Google, after a court in August found that the company had acted illegally to maintain a monopoly in internet search. In a filing to the court the government said the options it is considering include “behavioural and structural remedies” that would stop Google from using products such as Chrome, Play and Android to give it an advantage in search over rivals—in effect, a break-up of Google. Another option is forcing Google to share users’ search data with rivals. Google said the proposals were a threat to American competitiveness. The judge in the case won’t issue his recommendation until August.
What goes up…
Chinese stockmarkets fell back to earth with a bang, when a meeting of economic officials produced no additional stimulus on top of the measures that were recently rolled out. The blue-chip CSI 300 and Shanghai Composite fell by roughly 7% in a day, their biggest daily declines since the start of the pandemic. Investors are hoping that a briefing from the ministry of finance on October 12th will provide clues about any further stimulus.
X was restored in Brazil, after Elon Musk relented in his fight with the country’s Supreme Court and agreed to remove content that the court has deemed to be extremist from his social-media platform. X is paying millions of dollars in fines, while the court is unfreezing assets belonging to X and Starlink, Mr Musk’s satellite-based internet provider.
Rio Tinto agreed to buy Arcadium Lithium for $6.7bn, the biggest takeover to date of a lithium miner. The deal will make Rio Tinto one of the world’s largest producers of the metal, which is an important element in the manufacture of electric cars. Arcadium’s customers include Tesla and General Motors.
Chevron said it was selling its assets in Canada’s tar sands to Canadian Natural Resources for $6.5bn. Deal-making has been rife in Canada’s oil-rich western regions since operations in the expanded Trans Mountain pipeline began in May, boosting shipments of Albertan oil along the west coast and to Asia.
American employers added 254,000 jobs to the payrolls in September, a higher number than markets were expecting. That caused investors to bet that the next interest-rate cut from the Federal Reserve will be smaller than September’s half a percentage point reduction, as it glides the economy towards a “soft landing”.
New Zealand’s central bank cut its main interest rate by half a percentage point, to 4.75%, following a quarter-point reduction in August. The economy contracted in the second quarter. An even bigger rate cut is expected next month.
Oil prices remained volatile amid speculation that Israel may strike at Iran’s energy infrastructure and worries about hurricanes in America’s oil-producing Gulf region. Brent crude surged above $80 a barrel, its highest price since August, before pulling back.
Germany’s economy is now expected to shrink by 0.2% in 2024, according to the government, which would be the second consecutive year of contraction. It is forecast to grow by 1.1% in 2025.
Talks between Boeing and striking workers at its west-coast factories turned sour, as the company withdrew its pay offer and accused the union of not taking the negotiations seriously. The month-long strike is hampering Boeing’s recovery from a series of production setbacks. It delivered 33 aircraft in September, down from 40 in August.
Ports on America’s east and Gulf coasts opened for business again, after dockworkers ended their strike. Employers reportedly increased their pay-rise offer from 50% to 62% to get the workers to return.
China imposed anti-dumping measures on imports of brandy from the European Union, a tit-for-tat move in reaction to the EU’s planned tariffs on Chinese electric vehicles. The share prices of LVMH, which owns Hennessy cognac, and other brandy-makers fell sharply. The EU’s member states have voted to move ahead with the tariffs, despite the objections of Germany. China has described the duties as “unfair, non-compliant and unreasonable protectionist practices”.
Tributes were paid to Ratan Tata, one of India’s most high-profile businessmen, who died at the age of 86. Mr Tata became chairman of Tata Group in 1991, expanding the conglomerate’s ambitions abroad, buying Jaguar Land Rover in 2008. He was one of the drivers behind the Tata Nano, a cheap microcar, but it was a flop in India. Mr Tata once lamented the business environment in his home country, saying “I’ve often felt that the Indian tiger has not been unleashed.”
Dear valued investors
Samsung Electronics issued a public apology for not meeting expectations on performance and for the sense of crisis gripping the company. The South Korean firm has fallen behind the likes of Micron and SK Hynix in supplying chips for artificial intelligence. Its estimate of profit for the third quarter has come in well below forecasts. “Respected customers, investors, and employees,” Samsung said in an open letter, “these are testing times.”