Uber losses accelerate; China makes an offer; Brexit chaos

Posted at 2:50 AM, Nov 15, 2018
and last updated 2018-11-15 05:02:15-05

1. Uber losses accelerate: Uber continues to bleed money as it races toward a much-hyped IPO next year.

The tech firm said Wednesday that it lost $1.07 billion in the three months ending in September, up from a loss of $891 million in the previous quarter, as it invested in newer services ranging from food deliveries to scooters.

Uber posted sales of $2.95 billion for the quarter, up about 5% from the prior quarter and an increase of more than a third from the same period a year earlier.

The results highlight the challenge Uber faces in trying to generate the kind of rapid sales growth that investors expect from a newly public technology company without inflating its losses.

Uber has repeatedly said it expects to go public in 2019.

2. China makes an offer: The Chinese government has presented an offer to the United States to try to push forward stalled trade talks, according to two people briefed on the discussions.

The opening bid falls short of many of the core demands the White House has repeatedly detailed as must-haves in trade talks with Beijing, including addressing technology transfers and intellectual property theft, one of the people briefed told CNN.

Instead, the proposal has been described as a rehash of previous commitments Chinese leaders have publicly announced, like selectively lifting tariffs.

“What they are offering is not new,” this person said. “I think the two sides remain at an impasse. The channels are now open again, but there’s a lot of work to get to — whether it’s a modest de-escalation or ceasefire.”

Talks have been revived ahead of a planned meeting between US President Donald Trump and his Chinese counterpart, Xi Jinping, on the sidelines of the G20 summit in Buenos Aires.

3. Brexit in chaos: The UK government’s top official on Brexit, Dominic Raab, resigned on Thursday, throwing the UK-EU divorce deal negotiated by Prime Minister Theresa May into doubt.

The pound fell by 1.6% to below $1.28 on news of the resignation. It was trading flat earlier in the morning.

May said in a brief statement on Wednesday that she had secured the support of her cabinet to move ahead with the deal, which must also be approved by parliament. Now all bets are off, and the risk that Britain crashes out of the European Union is rising. There’s also a slim chance Brits may eventually be asked to vote again on Brexit.

4. Fed chair on economic challenges: Federal Reserve Chairman Jerome Powell says the US economy is robust. But headwinds could build next year.

“I’m very happy about the state of the economy now,” he said Wednesday in Dallas. “Our policy is part of the reason why our economy is in such a good place right now.”

The central banker said markets need to be prepared for more rate hikes.

“If you look down the road, you see challenges ahead,” he added. One key issue is whether the United States can weather an emerging global economic slowdown that has already ensnared three of the world’s top four economies.

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5. Global markets: US stock futures were higher.

European markets opened in positive territory, building on momentum that started in Asia.

Wednesday was another rough day for US stocks. The Dow swung sharply before closing down 206 points, or 0.8%. The S&P 500 declined 0.8% and the Nasdaq shed 0.9%.

Bitcoin extended its losses on Thursday, after falling more than 10% on Wednesday. It’s now trading around $5,500, far from the heights it reached during its meteoric rise at the end of 2017.

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6. Coming this week:

Thursday — Nvidia (NVDA), Nordstrom (JWN), Walmart (WMT), and Manchester United (MANU) earnings; October retail sales
Friday — Williams-Sonoma (WSM) earnings