BUSINESS NEWS JANUARY 6th 2016
FED MINUTES SHOW CONCERN ON ECONOMIC OUTLOOK
It was another weak session on Wall Street with the Dow ending below fell below 17,000 for the first time since October. Global issues including reports of North Korea testing a hydrogen bomb and weak economic growth in China continues to impact Wall Street. Federal Reserve officials expressed some hesitation as they decided at a mid-December policy meeting to raise short-term interest. Though the decision to hike rates was unanimous, a few officials expressed worries over low inflation, a stronger dollar and weak global growth. The observations are part of the minutes released from the Fed's December policy meeting. Inflation continues to remain below the Fed's 2% goal.
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U.S. PRIVATE SECTOR ADDS STRONG GAINS IN DECEMBER
Private-sector employment in the U.S. recorded strong gains last month. Employers added 257,000 jobs in December according to Automatic Data Processing (ADP). This is the strongest gain since December 2014. The data indicates a steady up-move in the U.S. labor market despite sign of global economic weakness.
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U.S. FACTORY ORDERS DECLINE
Orders to U.S. factories declined in November for the third time in the past four months. Factory orders dipped 0.2 percent in November after a 1.3% increase in October. American manufacturers have been hurt by a strong dollar, which has made their products expensive and less competitive overseas. The sector has also been hit by economic weakness in key export markets like China and Europe. Orders for long-lasting durable goods which includes everything from airplanes to refrigerators, was flat after a 2.8% increase in October.
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CHIPOTLE HIT BY PROFIT WARNING & NEWS OF PROBE
Chipotle Mexican Grill has warned that earnings and sales for its fourth quarter will come in far below the expectations it outlined in December. Sales continue to be hurt by illness outbreaks linked to the chain. The firm has also been served with a grand jury subpoena related to a norovirus incident at a Simi Valley, California, restaurant in August. Under the subpoena, Chipotle must produce a range of documents related to the Chipotle restaurant that experienced the norovirus incident.
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