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Things are bad at Sears. They're worse at Kmart

Things are bad at Sears. They're worse at Kmart

NEW YORK (CNN Business) - Sears is going to have a hard time surviving its bankruptcy. Kmart faces even longer odds.Traditional department stores, including Sears, face heavy competition from big b ... Continue Reading
'Halloween' grabs one of the biggest horror openings ever

'Halloween' grabs one of the biggest horror openings ever

NEW YORK (CNN Business) - It's hard to say it any other way: Michael Myers made a killing at the box office this weekend.

Universal's "Halloween," the 11th film in the horror franchise, beat expectations and earned an estimated $77.5 million in North America this weekend. That's the best opening ever for the 40-year-old slasher series.

It also marks second biggest debut for a horror film behind last year's "It," which had a $123 million opening.

The sequel, which stars Jamie Lee Curtis, adds to a blockbuster October. Earlier this month "Venom" notched a record setting $80 million, the best October debut on the books.

"Halloween" capitalized on its own brand recognition and the recent popularity of the horror genre to bring in such a big weekend. Films such as "Get Out," "A Quiet Place" and "It" have all surprised Hollywood in recent years with big box office totals.

The slasher film, which is a direct sequel to the 1978 classic, was also a hit with critics as well as audiences. It earned an 80% score on review site Rotten Tomatoes.

The surprising returns for "Halloween" mark another win for Hollywood, which is up 10.6% from the same point last year, according to comScore. This weekend's box office itself was up a whopping 71.7% from the same weekend in 2017.

The rest of the year also looks promising for the film industry. Potential blockbusters such as Warner Bros.' "Fantastic Beasts: The Crimes of Grindelwald," Paramount's "Bumblebee" and Disney's "Mary Poppins Returns" are still on the schedule for the rest of the year.

Saudi Arabia tries to salvage its investment conference after A-listers pull out

Saudi Arabia tries to salvage its investment conference after A-listers pull out

DUBAI (CNN Business) - Saudi Arabia's investment conference this week was once the hottest ticket in business and finance. Now the program has been stripped of names and a guest list, once a who's ... Continue Reading
How the Khashoggi case and its fallout is affecting global business

How the Khashoggi case and its fallout is affecting global business

(CNN) - The disappearance and death of Saudi journalist Jamal Khashoggi sent shockwaves through the business world, leaving in limbo planned investments, partnerships and projects in banking, transpo ... Continue Reading
Walmart's strategy to solve the Amazon puzzle is working

Walmart's strategy to solve the Amazon puzzle is working

NEW YORK (CNN Business) - Walmart is in the biggest fight of its 68-year history.

To stave off Amazon and remain the world's biggest retailer, Walmart is stepping up its grocery game and buying trendy digital brands. The company is redesigning its stores and building up its online assets.

"We're changing. We're adapting. We continue to transform," chief executive Doug McMillon said at Walmart's annual investor gathering on Tuesday.

Walmart (WMT) is marching forward with a two-track strategy designed for different customer segments: It's offering cheaper and more convenient ways to buy groceries for its low-and-middle income base, while acquiring high-end brands--- including Bonobos and Modcloth--- to draw wealthier shoppers long wary of Walmart's image.

The plan is working: Grocery sales growth is at a nine-year high. Walmart's online sales are expected to grow 40% this year, and the company said Tuesday that digital growth will expand by 35% in 2019.

"They are one of the few incumbents that has effectively landed some counter punches on Amazon," said Jason Goldberg, head of the commerce practice at digital agency SapientRazorfish.

Food fight

The company believes its 182,000-square-foot supercenters are its most effective weapon against Amazon (AMZN). Amazon bought Whole Foods last year, but it can't easily replicate an expansive brick-and-mortar presence across the world.

Walmart's proximity to shoppers' homes gives the company a leg up over its rivals in the grocery race. About 90% of Americans live within 10 miles of a Walmart.

Groceries are the biggest traffic driver to Walmart's stores. They make up 56% of its roughly $500 billion in annual sales.

Under McMillon, the company has bolstered the quality of its fresh grocery selection and invested in private-label brands, including Great Value and wine labels. Walmart has also lowered prices to compete and upgraded its supply chain to keep groceries fresher for longer.

In 2014, Walmart introduced curbside pickup. Shoppers can order online, select a pickup time, and pick up their groceries at thousands of stores without leaving their cars. Walmart has 25,000 trained personal shoppers who select produce and meat for online orders.

Retail experts say that option is more appealing to shoppers who drive to grab their groceries and don't have time to wait at home for them to arrive.

By the end of 2019, curbside pickup will be available at 3,100 Walmart supercenters and neighborhood markets. Whole Foods has only about 470 stores and it appeals to a narrow segment of the grocery market.

Walmart is marshaling its real estate in other ways, too. It will have 700 store pickup towers --- automated vending machines to retrieve online orders --- by the end of the year.

The company is testing a variety of first-and-third-party services to handle deliveries, including Spark, a crowd-sourced platform. The company will be able to cover 40% of the US population through delivery by the end of the year.

Although online delivery still makes up a fraction of the estimated $800 billion US grocery market, Walmart is taking steps to prepare for the future.

Climbing upmarket

Protecting groceries alone isn't enough and building new stores won't cut it anymore.

Walmart is only adding 10 stores next year in the United States after saturating the country with 182,000-square-foot supercenters. So Walmart is attempting to bring wealthier Americans into the fold with more income to spend on clothes, everyday essentials, and home goods.

Walmart dominates lower-income consumers, who make up 30% of the $4 trillion retail market the two are battling over, according to a Morgan Stanley data analysis.

But Amazon is winning in the higher end, which represents half of the available market.

Walmart has developed a shrewd acquisition strategy to reach those wealthier customers and chip away at Amazon's advantage.

Instead of betting on the Walmart name, the company is buying brands like Bonobos and online specialty stores such as Moosejaw, Hayneedle, and Shoebuy. In October alone, Walmart nabbed plus-size digital brand Eloquii and lingerie retailer Bare Necessities.

Walmart also has a new, modern-looking website. It has added more than 2,000 brands to the site in areas ranging from kitchenware to outdoor clothing.

The redesigned page not only helps Walmart appeal to wealthier customers, but convinces top brands to sell on it. For example, on Tuesday, Walmart announced a partnership with Advance Auto Parts for a dedicated page on

To appeal to city shoppers, Walmart has rolled out a relaunched, the online marketplace it bought two years ago from Lore for $3.3 billion.

"We really wanted to position and push it more upmarket --- really focus on the higher-income urban Millennials," said Marc Lore, Walmart's head of US e-commerce, on Tuesday. Jet is attracting premium brands like Nike to the site. It will start selling Bonobos clothes there next week.

Bringing startups into the Walmart ecosystem also expands the company's talent pool and expertise as it tries to reach tech-savvy shoppers.

For example, Andy Dunn, the founder of Bonobos, now runs Walmart's portfolio of digitally-native brands, including Bonobos, Modcloth, Allswell and Eloquii. Bare Necessities CEO and co-founder Noah Wrubel will lead and Jet's intimates category.

"When they make acquisitions, they do it a great deal for the intellectual capital they can build around it," said Alan Ellstrand, associate dean of the Walton College of Business at the University of Arkansas.

All roads lead to Amazon

The challenges Walmart faces are steep and expensive.

It lowered its profit guidance on Tuesday for 2019, citing its $16 billion acquisition for a controlling stake of Indian startup Flipkart. The deal, the largest in Walmart's history, will position the company to take a bigger slice of India's fast-growing online retail market. Amazon was reportedly the next-highest bidder for Flipkart.

Walmart's investments to ramp up online will also dent the company's profit margins. "We expect losses to increase some next year," CFO Brett Biggs said on Tuesday.

The company is far behind Amazon on building out its online shipping capabilities: It operates fewer than 10 dedicated e-commerce facilities, compared to Amazon's 122 core fulfillment centers, Morgan Stanley's Gutman noted.

Goldberg, from SapientRazorfish, questioned whether Walmart has the agility and speed to disrupt itself in time to stave off Amazon.

Walmart has an entrenched supply chain and a distribution model that allowed it to become the world's largest retailer, but that same infrastructure makes it challenging to pivot.

"My main concern about Walmart continues to be competition from Amazon," said Ellstrand. "While Walmart continues to innovate in the online space through the acquisitions it has made, its platform continues to trail Amazon."

Clarification: This story has been changed to clarify the title of Walmart's 25,000 personal shoppers who select groceries for online orders, as well as the role of Andy Dunn, Walmart's senior vice president of digital consumer brands.

US importers stuck with Trump's latest China tariffs

US importers stuck with Trump's latest China tariffs

NEW YORK (CNN) - American importers can ask for an exemption from President Donald Trump's tariffs on steel and aluminum, and his first two rounds of tariffs on Chinese goods. But they're stuck pay ... Continue Reading
JPMorgan is building a fintech campus in Silicon Valley

JPMorgan is building a fintech campus in Silicon Valley

NEW YORK (CNN Business) - JPMorgan Chase is building a campus in Silicon Valley as it redoubles its focus on tech --- and looks to compete more aggressively for top talent.The bank said Friday that ... Continue Reading
Patagonia CEO gets political, endorsing two Democratic Senate candidates

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Tom Barrack, CEO and Trump friend, drops out of Saudi conference

Tom Barrack, CEO and Trump friend, drops out of Saudi conference

NEW YORK (CNN Business) - Tom Barrack, CEO of Colony Capital and a close friend of President Donald Trump, has dropped out of next week's Future Investment Initiative in Saudi Arabia.

Barrack told CNN that his session at the summit was canceled because he was scheduled to speak with Treasury Secretary Steven Mnuchin, who pulled out of the event on Thursday.

"As a consequence, I postponed my visit," said Barrack, who chaired the president's inaugural committee.

Barrack, a real estate investor, has known Trump for 40 years. He's previously helped raise money to support Trump's political ambitions and has publicly defended the president.

A wave of top executives withdrew from the high-profile investment conference this week amid growing controversy over dissident journalist Jamal Khashoggi's disappearance and apparent killing.

JPMorgan (JPM) CEO Jamie Dimon, BlackRock (BLK) CEO Larry Fink and Blackstone (BX) CEO Stephen Schwarzman said earlier this week that they will not attend.

Mnuchin announced his decision shortly after Secretary of State Mike Pompeo briefed Trump on his visit earlier this week to Riyadh to discuss the Khashoggi case.

Pompeo urged patience with the Saudi investigation, telling reporters that he advised the President to give the Saudis "a few more days" --- but Mnuchin followed up shortly afterward with a tweet saying he would not go to Riyadh, reversing the position he's taken over the past week.

"Just met with @realDonaldTrump and @SecPompeo and we have decided, I will not be participating in the Future Investment Initiative summit in Saudi Arabia," Mnuchin tweeted Thursday.

Elizabeth Warren wants Wells Fargo to fire its CEO. She wants the Fed's help

Elizabeth Warren wants Wells Fargo to fire its CEO. She wants the Fed's help

NEW YORK (CNN Business) - Senator Elizabeth Warren wants regulators to keep Wells Fargo in the penalty box until the bank replaces CEO Tim Sloan.In a letter to the Federal Reserve on Thursday, Warr ... Continue Reading
When should I sell my mutual funds?

When should I sell my mutual funds?

NEW YORK (CNNMoney) - When is the best time to get out of a mutual fund?After a recent stock market dip, Ian Bloom, a financial planner in North Carolina got a panicked call from a VIP client: his ... Continue Reading
These business A-listers are skipping Saudi Arabia's big conference

These business A-listers are skipping Saudi Arabia's big conference

(CNN Business) - Most of the big names who were due to attend Saudi Arabia's investment conference next week have bailed out following the disappearance and apparent killing of prominent journalist Jamal Khashoggi.

US Treasury Secretary Steven Mnuchin announced Thursday he would not attend the conference. IMF Managing Director Christine Lagarde dropped out on Wednesday, closely followed by the heads of two of France's biggest banks.

Wall Street's biggest names withdrew earlier this week, as did some of Europe's top executives in finance.

Khashoggi, a Washington Post columnist, hasn't been seen since he entered the Saudi consulate in Istanbul on October 2.

Turkish officials have told CNN he was killed inside the consulate. Saudi authorities have so far maintained that Khashoggi left the consulate the same day, but they have provided no evidence to support the claim.

The Saudi conference, known as "Davos in the desert," is part of Crown Prince Mohammed bin Salman's plan to transform the oil-dependent economy.

These are the high-profile participants who have already pulled out:

US Treasury Secretary Steven Mnuchin

JPMorgan Chase CEO Jamie Dimon

Ford Executive Chairman Bill Ford

Uber CEO Dara Khosrowshahi

Blackstone CEO Stephen Schwarzman

Blackrock CEO Larry Fink

MasterCard CEO Ajay Banga

Viacom CEO Bob Bakish

HSBC CEO John Flint

Credit Suisse CEO Tidjane Thiam

BNP Paribas Chairman Jean Lemierre

Societe Generale CEO Frédéric Oudéa

Standard Chartered CEO William Winters

London Stock Exchange CEO David Schwimmer

IMF Managing Director Christine Lagarde

Glencore Chairman Tony Hayward

Thrive CEO Ariana Huffington

Google Cloud CEO Diane Greene

Sinovation Ventures CEO Kai-Fu Lee

World Bank President Jim Yong Kim

Los Angeles Times owner Patrick Soon-Shiong

Economist Editor-in-Chief Zanny Minton Beddoes

New York Times columnist Andrew Ross Sorkin

UK trade minister Liam Fox

The chief executives of a handful of prominent Asian and European companies --- some of whom have benefited from hefty Saudi investments --- are still planning to attend, or are refusing to talk about their plans.

Here's a list of big names who are still planning to participate:

Siemens CEO Joe Kaeser

EDF CEO Jean-Bernard Lévy

Thales CEO Patrice Caine

These executives have not yet commented on whether they still plan to attend:

SoftBank CEO Masayoshi Son

Accor CEO Sébastien Bazin

Why Eddie Lampert stuck with Sears

Why Eddie Lampert stuck with Sears

NEW YORK (CNN Business) - Eddie Lampert was heralded as a financial genius when he bought Sears in 2005 through a merger with Kmart. BusinessWeek ran his picture on the cover with the headline "The Ne ... Continue Reading
Treasury again skips labeling China a currency manipulator

Treasury again skips labeling China a currency manipulator

WASHINGTON (CNN) - The Trump administration on Wednesday decided not to label China a currency manipulator despite the recent drop in the value of the yuan, once again deferring on a core 2016 campaign promise by President Donald Trump.

In the past six months, the yuan has dropped more than 9% against the US dollar. And there are growing signs that the country's currency may fall further to 7 yuan to the greenback --- a threshold not crossed since before the 2008 financial crisis.

The yuan weakened following the US announcement. In morning trading Thursday in Asia, it hit its lowest level against the dollar since January 2017.

The yuan's sharp depreciation comes amid a trade war between Washington and Beijing and accusations from Trump that China is deliberately devaluing its currency --- claims Beijing has repeatedly rejected.

Yet the Treasury Department in its twice-a-year report on foreign exchange found "limited" signs the People's Bank of China was actively devaluing its currency.

China's lack of transparency over its currency and recent weakness in the yuan are of "particular concern" for the United States, Treasury Secretary Steven Mnuchin said in a statement, noting the two issues "pose major challenges to achieving fairer and more balanced trade."

Mnuchin said the US government would continue to monitor China's currency and continue ongoing discussions with the Asian nation's central bank.

In its report, the US government noted that the recent depreciation of the yuan would "likely exacerbate" China's already large bilateral trade surplus of $390 billion with the United States over the past four quarters through June 2018.

"It is in China's interest to implement measures that would reduce the bilateral trade imbalance," the report warned.

The Trump administration has made currency issues part of its on-off trade negotiations with Beijing.

"We want to make sure that we don't have gains on trade issues only to be offset on currency issues," Mnuchin said in an interview with CNN on the sidelines of the International Monetary Fund's annual meeting in Bali, Indonesia.

The currency has been falling partly because of fears that the trade war will hurt the Chinese economy. A weaker yuan helps to offset the impact of tariffs by making Chinese exports cheaper.

The Trump administration has slapped new tariffs on Chinese goods worth hundreds of billions of dollars. It is seeking to gain an edge by upping pressure on China as it struggles with slowing economic growth and sharp declines in the country's stock markets.

China has retaliated with tariffs on a much smaller range of American products because it buys far less from the United States than it sells to it.

The United States also put five other trading partners on watch: Japan, Korea, Germany, Switzerland and India.

Presidents have often used the semiannual currency report as a diplomatic tool while engaging with countries that are seen as having exchange rate policies that harm US jobs and economic growth.

The United States hasn't labeled a country a currency manipulator since it tagged China in the early 1990s, under President Bill Clinton. Designating a country doesn't immediately trigger penalties, but is seen by other governments as a provocation.

eBay sues Amazon, accusing it of poaching sellers

eBay sues Amazon, accusing it of poaching sellers

SAN FRANCISCO (CNN Business) - As Amazon continues its rise as the world's largest online marketplace, rival eBay charges that it got there by crossing a legal line. eBay filed a lawsuit against Am ... Continue Reading
CEO of Corona maker Constellation Brands steps down

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Fed appears committed to gradual tightening despite Trump criticism

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How high will oil go? Iran is the biggest X factor

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Trump administration moves to stop subsidizing Chinese mail

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Elizabeth Warren wants Toys 'R' Us owners to take care of its 30,000 laid off workers

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NEW YORK (CNN Business) - Senator Elizabeth Warren is urging the companies responsible for the demise of Toys "R" Us to take care of its former employees. Warren, who has said she's considering a r ... Continue Reading