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The Morning Ledger: U.S. Wages Climb At Fastest Pace in a Decade |
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A worker prepares an order for shipment at the My Pillow production facility in Shakopee, Minn., in September. PHOTO: ARI LINDQUIST/BLOOMBERG NEWS
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Good day. Wages for U.S. private-sector workers rose at the fastest pace in a decade during the third quarter, a sign that the tighter labor market is paying dividends for more workers, reports The Wall Street Journal.
Pay gains: Wages and salaries rose 3.1% from a year earlier in the third quarter, the fastest gain since the second quarter of 2008. The increases come as the unemployment rate fell to 3.7% in September, the lowest reading in 49 years.
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Leverage: The combination of low unemployment and steady hiring appears to be putting workers in a position to command better compensation. And with labor market conditions still tightening, some economists expect wage growth to accelerate further.
Benefit growth cools: Benefit costs—which include health coverage, retirement benefits and paid leave—advanced a slower 0.4%. That could be a sign that employers are shifting compensation to base pay. It also could indicate that tax-cut related bonuses, which propped up benefits growth early in the year, didn’t extend into the third quarter.
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U.S. weekly jobless claims data is due out at 8:30 a.m. ET. Economists surveyed by the WSJ predict unemployment claims fell to 211,000 in the latest period, from 215,000 a week earlier.
The Institute for Supply Management will release its U.S. manufacturing purchasing managers' index at 10 a.m. ET. Economists predict that expansion in factory activity eased to 59.0 in October from 59.8 in September, though any reading above 50 indicates increasing activity.
Apple Inc., CBS Corp., Kraft Heinz Co., Metlife Inc., Oshkosh Corp. and Shake Shack Inc. are among the companies reporting earnings Thursday. The WSJ's Tripp Mickle writes of four things to watch in Apple's results.
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The ‘Dark Side’ of Managers With Audit Background |
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Handing large paychecks to corporate executives with audit-firm experience could raise the risk of financial misstatements, according to new research.
Companies that gave top managers above-average compensation and whose executives had an audit-firm background were about 30% more likely than those with lower-paid counterparts to misstate financial results, according to a study in the November issue of The Accounting Review. The study examined more than 3,000 public companies over a 10-year period.
The combination of audit-firm experience and excess pay brought out this “dark side” of accounting competence and raised the risk of misstatements, said Anne Albrecht, an assistant professor of accounting at the Neely School of Business at Texas Christian University, who is one of the study’s authors.
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MSCI to Launch New Stock Benchmarks Excluding Non-Voting Shares |
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Index provider MSCI Inc. plans to launch a new suite of market indexes that won’t include stocks with unequal voting rights, a move that aims to cater to investor preferences against dual-class listings.
The new indexes, announced Tuesday, are scheduled to be launched in early 2019. They will be an addition to MSCI's existing stable of equity indexes that include non-voting shares. The decision follows an 18-month consultation.
MSCI supports equal voting rights among investors, but said that its consultation found that international institutional investors disagreed whether stock benchmarks should be adjusted to reflect the unequal voting rights.
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Cadillac sport-utility vehicles outside a car dealership in Shanghai in July. GM’s Cadillac brand posted record sales in China in the third quarter. PHOTO: QILAI SHEN/BLOOMBERG NEWS
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General Motors Co. reported a 25% jump in third-quarter profits on Wednesday, but the auto maker also said it offered buyouts to 18,000 salaried workers in an effort to cut costs amid slowing sales in the global car business.
Volkswagen AG and Ford Motor Co. are discussing a strategic alliance to jointly develop self-driving and electric vehicles, reports Reuters.
Subaru Corp. is picking up a hefty tab to recall over 400,000 vehicles globally to repair a faulty engine part that could cause stalling.
Hundreds of employees of Alphabet Inc.'s Google unit staged walkouts on Thursday, with thousands more expected to follow at offices world-wide, amid complaints of sexism, racism and unchecked executive power at the firm, Reuters reports.
Insurance giant American International Group Inc. posted a $1.26 billion third-quarter net loss, weighed down by policyholders’ claims from Asian typhoons, California mudslides, and Hurricane Florence in the U.S. Southeast.
Royal Dutch Shell PLC said Thursday its net profit jumped 50% in the third quarter, underpinning signs of renewed strength in the sector amid stronger oil prices.
BHP Billiton Ltd., the world’s biggest mining company by market value, said it would return $10.4 billion to shareholders via a stock buyback and special dividend.
Kellogg Co. is investing in single-serve packages of its snacks like Pringles and Cheez-Its to help boost sales, but the cost of producing them is denting its profit.
Bunge Ltd.’s chief executive said Wednesday a newly formed board committee will consider all options to improve the agricultural giant’s value, but it would bring no “preconceived” plans.
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The Federal Reserve’s rollback of bank rules would affect large U.S. lenders including U.S. Bancorp. and Capital One Financial. PHOTO: MARK LENNIHAN/ASSOCIATED PRESS
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The U.S. Commodity Futures Trading Commission brought a record 26 cases related to market manipulation in the fiscal year ended Sept. 30.
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The U.S. Environmental Protection Agency extended by two years its approval of XtendiMax, a version of the herbicide dicamba made by Bayer AG, which some farmers and researchers have blamed for damaging millions of acres of crops.
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Cindy Fornelli, executive director at the Center for Audit Quality. PHOTO: CAQ
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Companies Pull Back Curtain on Auditor Selection, Oversight
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More U.S. public companies in 2018 voluntarily shared with investors details about how their boards of directors select and oversee external auditors, according to an annual report from industry group Center for Audit Quality and research firm Audit Analytics.
Forty-six percent of S&P 500 companies told investors what factors they considered when judging the performance of their auditors in 2018, up from 38% in 2017, according to the report. And 26% percent said that the evaluation of their auditor is performed at least annually, up from 21% in 2017. The research is based on audit committee reports in corporate proxy statements.
“Over the past five years, audit committees have provided increasingly robust disclosures about their important investor-protection role in overseeing the external audit,” said CAQ Executive Director Cindy Fornelli in a statement.
Moreover, 40% of S&P 500 companies disclosed what factors they considered when appointing an external auditor, up from 37% in 2017. And 70% of companies in the index disclosed how long they have been working with the audit firm, up from 63% last year.
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World Bank Chief Economist Pinelopi Koujianou Goldberg. PHOTO: MICHAEL MARSLAND/YALE UNIVERSITY
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The U.S. fell to eighth place in the World Bank’s annual ranking of the world’s economies for their ease of doing business, as the American business environment was eclipsed by Norway and Georgia.
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The U.S. economy grew exactly 3% in the year through September, but that pace of economic expansion is likely unsustainable, writes the WSJ's Greg Ip.
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The U.S. private sector added 227,000 jobs in October, according to a report released Wednesday, largely driven by employment growth at larger businesses.
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Chinese companies that borrow in U.S. dollars but make most of their sales at home are suffering as the yuan weakens.
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Gunvor Group, the Geneva-based commodities trader, named Muriel Schwab as group chief financial officer. She succeeds Jacques Erni, who will transition to an executive director role on the company's board.
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Ms. Schwab is to begin her new role no later than May 1, 2019. She most recently served as regional head of trade and commodity finance for the Americas at Coöperatieve Rabobank UA, a role she's held since 2015. Prior to that she completed an advanced degree at the Yale School of Management, and had served as CFO for the Asia-Pacific region at Gunvor.
The Rank Group PLC, a U.K.-based casino operator, appointed William Floydd as CFO, effective Nov. 12. Most recently, Mr. Floydd was CFO at Experian PLC's U.K. and Ireland business and prior to that worked in various positions for Logica PLC. Interim CFO James Pizey will become group financial controller, Rank Group said in a statement. Compensation details were not available.
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