Bloomberg - Evening Briefing - The Dow goes wild

And the crowd went wild. As the US Federal Reserve left interest rates the same on Wednesday, it also filled investors with joy by saying it foresees lowering rates by 75 basis points in 2024. Wall Street reacted with ecstasy, as the Dow Jones Industrial Average notched its first record close in almost two years, recouping all losses from Jerome Powell’s seemingly victorious war on inflation. Just 15 months ago, the Dow had slid into bear territory. But in recent months, the index has been buoyed by the prospect of a resilient US economy, ebbing inflation and strong corporate earnings. In November, the Dow rallied 8.8% to hit its biggest monthly gain in more than a year. “Beaten up stocks that are tied to the health of the economy have come back to life,” said Eric Beiley, executive managing director of wealth management at Steward Partners Global Advisory. “Stocks that have been hit by high rates are starting to recover.” —David E. Rovella 

Citigroup is offering a portion of annual bonuses early to those staffers who agree to depart. Under Chief Executive Officer Jane Fraser, the bank has engaged in a massive restructuring that includes an as-yet untold number of firings. For some elite traders and bankers, their annual bonuses, usually paid in February, can stretch into millions of dollars.

The US Supreme Court is wading into the 2024 election, setting the stage for decisions on two critical issues at the heart of Donald Trump’s prosecution for his alleged 2020 effort to subvert American democracy. The high court, controlled by six Republican-appointees including three picked by Trump, also will hear a case that could further restrict the reproductive autonomy of American women. The court’s GOP-appointed majority in 2022 threw out the 50-year-old federal right for women to end a pregnancy by abortion. Now it will decide whether to limit access to a common abortion pill—in a case with even broader ramifications.

More bad news for the world’s richest man. Elon Musk’s Tesla says it will fix more than 2 million vehicles—its biggest recall ever—after the top US auto-safety regulator determined its driver-assistance system Autopilot doesn’t do enough to guard against misuse. The recall is the second this year involving Tesla’s automated-driving systems, which have come under escalating scrutiny after hundreds of crashes—some of which resulted in fatalities. Critics of the company say the recall doesn’t go far enough.

Joshua Brown was killed when his Tesla, above, crashed while in self-driving mode in 2016. Source: rusj/NTSB via Florida Highway Patrol

President Joe Biden has offered changes to US border policy that raises the prospects of a bipartisan deal on aid to Ukraine, Republican senators said Wednesday. GOP members met behind closed doors to evaluate the verbal offer, which emerged after Homeland Security Secretary Alejandro Mayorkas met with senators for nearly two hours Tuesday evening. Republicans have been blocking aid to Ukraine as it faces its second winter under invasion by Kremlin forces.

For the first time in more than 50 years the US granted permission for a new type of nuclear reactor, a sign regulators are becoming more open to different approaches to producing power from splitting the atom. California startup Kairos Power received a construction permit from the Nuclear Regulatory Commission to build its Hermes demonstration reactor in Tennessee. While commercial reactors in use today are cooled by water, the Kairos technology uses molten fluoride salt as a coolant.

For anyone concerned about America’s future, the latest findings from the Program for International Student Assessment are nothing short of alarming, Michael R. Bloomberg writes in Bloomberg Opinion. US math scores fell by 13 points between 2018 and 2022, with students continuing to underperform their peers in most other developed countries. This failure underscores the need to improve America’s schools and hold them accountable for results, Bloomberg writes. 

The latest UN climate summit ended with an announcement that nations have committed to transitioning away from all fossil fuels. The president of this year’s UN-sponsored summit, Sultan Al Jaber of the oil-rich United Arab Emirates, brokered an agreement that watered down language sufficiently to satisfy other oil producers, such as Saudi Arabia. The deal calls for countries to quickly shift energy systems away from fossil fuels in a just and orderly fashion, albeit in a non-binding deal. The history of adherence to such pledges is spotty at best. After a pledge to phase down coal in Glasgow, Scotland, two years ago, consumption has continued to rise and the world remains very unlikely to limit warming to the Paris Agreement’s target of 1.5C. 

Environmental activists during a demonstration at the venue of the COP28 United Nations climate summit in Dubai on Dec. 5 Photographer: Karim Sahib/AFP

• China’s Xi asks Vietnam to stop outsiders from messing up the region.
• With 18,000 killed by Israel, Palestinian support for Hamas surges.
• World’s poorest countries are buckling under $3.5 trillion in debt.
• Salesforce’s Benioff is cashing out at a rate of $3 million a day.
• Bill Ackman denies he’s attacking Harvard because he has a grudge.
• Embryo errors, flooded clinics: Kindbody and IVF's risky business.
• Class of 2024 can’t land jobs as hiring in tech, finance wanes.

In Puerto Rico, nearly one-quarter of tourists have one thing in common: They flock to El Yunque National Forest. The lush, 29,000-acre protected area, just an hour’s drive east of San Juan, has become the island’s No. 1. nature attraction and most-visited site since the pandemic, drawing approximately 1.2 million visits annually. Now, some of them can help conserve it.

El Yunque National Forest is Puerto Rico’s most-visited attraction. Photographer: Carlos Manchego

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