From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
DOW BREAKS 29,000
The December jobs report came in slightly below expectations but nevertheless capped a year of strong hiring. U.S. nonfarm payrolls rose by 146,000 for the month, below the 160,000 estimate. The unemployment rate remained unchanged, at the near-historic low of 3.5 percent, but wage growth softened a bit, dropping below 3 percent for the first time since the summer of 2018. That disappointing number was brushed off by investors, who sent the Dow surging past 29,000 for the first time before pulling back and ultimately closing at 28,823. Markets have continued their "Santa Claus rally" well into the new decade, with all major indices now at or near all-time highs.
OIL SPIKES ON IRAN
Markets proved incredibly resilient during what was one of the most geopolitically fraught weeks in memory. The U.S. and Iran edged back from the brink of war after Iran made a calculated retaliatory strike against a U.S. military base in Iraq that led to no casualties and only minimal damage. President Trump said he did not plan to escalate further, with the two sides retreating back to their corners, for the time being, a week after the targeted killing of Gen. Qassem Soleimani. The U.S. is slapping more sanctions on Iran, though, this time on metal exports and a handful of senior officials in the government. Meanwhile, Brent crude, the global oil benchmark, edged above $65 a barrel at the end of the week. At the height of the week's tensions, oil was trading above $71.
BOEING IN CRISIS
An airplane "designed by clowns, who are in turn supervised by monkeys." That is how one Boeing ($BA) employee referred to the production and approval of the 737 Max jet, according to newly-released internal documents the company made public. Those documents show Boeing employees mocking the FAA and bragging about how easily they were able to deceive regulators in the push to get the Max into service. Boeing shares had a roller coaster of a week, plunging after a Ukrainian passenger jet crashed after takeoff from the airport in Iran's capital city. Ukraine initially said that plane crashed due to engine failure, but intelligence agencies are increasingly of the belief that it was accidentally shot down by Iran. Boeing's stock recovered on that news but then took another hit after those internal documents were published.
The first Tesla Model 3 sedans began rolling off the assembly lines in China this week. Elon Musk was there in person to commemorate (and show off his dance moves) in celebration of the milestone, which has helped fuel Tesla ($TSLA) shares during an incredible run over the last three months. The stock blew past the $420 market and is on its way to $500, though investors pumped the brakes a bit this week with a pair of downgrades, arguing the company is no longer undervalued. At the same time, with a market capitalization approaching $90 billion, Tesla is now the most valuable U.S. automaker of all time, breaking the record held by Ford set in 1999. From a valuation perspective, Tesla is now worth more than GM and Ford ー combined ー thanks largely to its early signs of success in China, where electric cars are selling like hot cakes.
GOING, GOING, GHOSN...
Carlos Ghosn, the enigmatic former auto industry impresario turned international fugitive, spoke (and spoke, and spoke...) to the media this week for the first time since his arrest and escape from Japan. In a meandering presentation from Beirut that lasted more than three hours, Ghosn accused his former employers at Nissan of working hand-in-glove with Japanese prosecutors to orchestrate trumped-up charges against him, compared his plight to the attack on Pearl Harbor, and explained why he decided his only option was to flee Japan to the friendlier confines of Lebanon, which he did under the cover of night last month, reportedly inside a concert equipment box on a private jet.
Ghosn told the assembled press that he was "brutally taken" from the world he knew when he was arrested for the first time in November 2018, and his ensuing ordeal in Japan amounted to a human rights violation, in which prosecutors held him in solitary confinement, repeatedly denied him access to legal counsel, and contact with his family, and attempted to coerce him into a confession that he misused company funds and underreported his income. After the press conference, broadcast live around the world, Lebanon's government ordered Ghosn to stay put while they figured out how to handle his case.