Business Highlights

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Fed stresses its commitment to low rates as economy stumbles

WASHINGTON (AP) — The Federal Reserve pledged on Wednesday to keep its low interest rate policies in place even well after the economy has sustained a recovery from the viral pandemic. The Fed said in a Thastatement after its latest policy meeting that the improvement in the economy and job market has slowed in recent months, particularly in industries affected by the raging pandemic. Fed officials kept their benchmark short-term rate pegged near zero and said they would keep buying Treasury and mortgage bonds to restrain longer-term borrowing rates and support the economy

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Facebook Q4 results soar in prelude to an uncertain 2021

MENLO PARK, Calif (AP) — Facebook capped a tumultuous 2020 with soaring earnings in the final quarter, its user base boosted by people staying home and its revenue buoyed by a shift to digital advertising amid the pandemic. But the company predicted uncertainty for 2021 and said its revenue in the latter half of the year could face significant pressure. Because revenue grew so quickly in the second half of 2020, the social network could have trouble keeping up that pace. It’s also facing challenges in how it targets advertisements, including Apple’s coming launch of privacy protections that could limit Facebook’s ability to target ads.

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Apple posts big quarter on fast sales start for iPhone 12

SAN RAMON, Calif. (AP) — Apple’s delayed launch of its latest iPhones unleashed a holiday buying frenzy that propelled sales of the trendsetting company’s most popular product to its fastest start in years. The apparently pent-up demand for four different iPhone 12 models highlighted Apple’s latest quarterly report Wednesday. Apple’s iPhone sales during the October-December period totalled $65.6 billion, a 17% increase from the same time in the previous year.

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In duel with small investors over GameStop, big funds blink

NEW YORK (AP) — Across most of America, GameStop is just a place to buy a video game. On Wall Street, though, it’s become a battleground where swarms of smaller investors see themselves making an epic stand against the 1%. The funds serving the financial elite are starting to walk away in defeat, after bets they made for GameStop’s stock to fall left them facing billions of dollars in collective losses. The stunning seizure of power gives validation to smaller-pocketed investors. It also has Wall Street asking if the stock market’s in a dangerous bubble about to pop.

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Cybercops derail malware botnet, FBI makes ransomware arrest

THE HAGUE, Netherlands (AP) — European and North American cyber cops have joined forces to disrupt what may be the world’s largest network for seeding malware infections. The operation appears to strike a major blow against criminal gangs that have used that network for years to install ransomware for extortion schemes and to steal data and money. Separately, the FBI announced the arrest of a Canadian as part of a bid to disrupt a ransomware that has targeted the health care sector, seizing nearly a half million dollars in cryptocurrency. The Emotet botnet taken down in the multinational operation has served as a primary door-opener for cybercriminals since 2014.

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Stocks have their worst day since October as Big Tech sinks

NEW YORK (AP) — The stock market posted its biggest drop since October Wednesday, led by declines in several Big Tech companies. The S&P 500 gave up 2.6%. The benchmark index had set a record high just two days earlier. The selling was broad, though technology giants including Facebook, Netflix and Google’s parent company accounted for a big part of the pullback. The stock of beleaguered video game seller GameStop more than doubled as an army of small investors ganged up against hedge funds that made huge bets that the stock would fall. The Federal Reserve stressed its commitment to keep interest rates low.

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Tesla posts 1st annual profit but misses analysts’ estimates

PALO ALTO, Calif (AP) — Riding a sales surge amid a global pandemic, Tesla Inc. posted its first annual net profit last year as its stock soared to make it the world’s most valuable automaker. The electric vehicle and solar panel maker earned $721 million for the year and $270 million in the fourth quarter. It was the company’s sixth straight quarterly net profit after years of mostly losses. A year earlier, Tesla lost $862 million. Data provider FactSet says that capped a string of annual red ink that began in 2006. Once again the company needed regulatory credits purchased by other automakers in order to make a profit. Without $1.58 billion in credits for the year, Tesla would have lost money.

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Boeing posts $8.4 billion loss on weaker demand for planes

CHICAGO (AP) — Boeing reported another huge loss, this one because of a setback to its 777X widebody jetliner. Boeing said Wednesday it lost $8.4 billion in the fourth quarter on weaker demand for planes during the pandemic. The loss includes a pretax charge of $6.5 billion tied to the 777X. Boeing is pushing back the expected first delivery of the 777X by a year, until late 2023, because of tougher standards for certifying new planes and weaker demand for international travel because of the pandemic.

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The S&P 500 fell 98.85 points, or 2.6%, to 3,750.77. The Dow Jones Industrial Average lost 633.87 points, or 2%, to 30,303.17. The Nasdaq slid 355.47 points, or 2.6%, to 13,270.60. The Russell 2000 index of smaller companies gave up 41.16 points, or 1.9%, to 2,108.70.

The Associated Press