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Business Highlights

February 3, 2021 GMT

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Why US hiring could rebound faster than you might expect

WASHINGTON (AP) — Hiring has weakened for six straight months. Nearly 10 million jobs remain lost since the coronavirus struck. And this week, the Congressional Budget Office forecast that employment won’t regain its pre-pandemic level until 2024. And yet a hopeful view is gaining steam that as vaccinations reach a critical mass in the United States, perhaps around midyear, the economy and the job market will strengthen much more quickly than they did after previous recessions. For now, though, the economy’s rebound has been highly unequal. The unemployment rate for the poorest one-quarter of Americans is roughly four times the rate of the richest one-quarter.

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Amazon CEO Jeff Bezos may step down without stepping away

SEATTLE (AP) — Even after stepping aside as CEO, Amazon founder Jeff Bezos will likely keep identifying new frontiers for the world’s dominant e-commerce company. His successor, meanwhile, gets to deal with escalating efforts to curtail Amazon’s power. Even after long-time Amazon executive Andy Jassy becomes CEO, Bezos will remain the company’s largest shareholder while taking on the role of executive chairman. That’s a title typically given to someone who intends to remain deeply involved key decisions. And Bezos has signaled his desire to keep coming up with new product ideas. He reassured investors that the executive who built Amazon into a $1.7 trillion goliath will be sticking around.

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Bezos may step up charitable aid for climate and families

NEW YORK (AP) — Jeff Bezos’ decision to step down as Amazon’s CEO, in part to devote more energy to his philanthropic work, appeared to reflect the multi-billionaire’s growing interest in charitable causes. Last year, Bezos, 57, gave $10 billion – the largest single charitable donation of 2020, according to the Chronicle of Philanthropy – to establish the Bezos Earth Fund to fight climate change. He also supports the Bezos Day One Fund, which donated $106 million in 2020 to organizations that provide food and shelter to young families in need. In October, the Day One Fund opened the first Bezos Academy, a Montessori-inspired preschool geared for low-income families in Des Moines, Washington.

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Buttigieg says Transportation Dept will push ‘bold’ thinking

WASHINGTON (AP) — Pete Buttigieg, newly sworn in as transportation secretary, is urging his 55,000 employees to embrace “imaginative, bold, forward thinking” as the Transportation Department embarks on a vital mission to rebuild America’s infrastructure and foster equality. In an email message to employees, which was obtained by The Associated Press, Buttigieg said the department will continue to prioritize safety. But he says he looks forward to working with them to “break new ground” to help the economy rebuild, fight the climate crisis and and make sure “transportation is an engine for equity in this country.” Buttigieg, a 39-year-old former mayor of South Bend, Indiana, was sworn in as transportation secretary Wednesday morning by Vice President Kamala Harris.

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GameStop’s stupefying stock rise doesn’t hide its reality

NEW YORK (AP) — Behind GameStop’s stock surge is the grim reality that the video game retailer is floundering even as the industry around it is booming. The Texas-based company has been swept up in a battle between big-moneyed hedge funds betting against it and small investors trying to prop it up. That has caused GameStop’s share price to soar despite the shaky financials underneath. And even though there are some bright spots, like improving holiday sales and the naming of co-founder Chewy to the board, any reinvention will take take time and may not work. Many investors fully understand the contradiction between GameStop’s stock price and its business fundamentals. But for those who imagine it to be the next Tesla or Amazon, the truth is: It’s likely not.

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Service sector operates at highest level in almost two years

WASHINGTON (AP) — The services sector, where most Americans work, operated in January at the highest level in almost two years. The Institute for Supply Management reported Wednesday that activity in the services sector climbed to a reading of 58.7% in January on a seasonally adjusted basis, up a full percentage point from the December reading of 57.7%. This was the highest reading since February 2019 when the index was at 58.8%. The January performance represented the eighth straight month of growth after sharp declines last spring when the economy was leveled by a global pandemic.

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Daimler to spin off trucks, change name to Mercedes-Benz

FRANKFURT, Germany (AP) — German automaker Daimler plans to split into two independent companies by spinning off its truck and bus division. The Stuttgart-headquartered company said Wednesday that a significant majority stake in the truck business would be distributed to current shareholders, and that Daimler would “at the appropriate time” be renamed Mercedes-Benz, the brand name under which it sells luxury cars. The goal is to make both independent companies more nimble so they can move ahead faster with new technology such as zero-emission vehicles and software, two trends that are disrupting the industry. The company says it makes sense because the businesses of making luxury cars and heavy trucks and buses have different needs.

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The S&P 500 rose 3.86 points, or 0.1%, to 3,830.17. The Dow Jones Industrial Average gained 36.12 points, or 0.1%, to 30,723.60. The tech-heavy Nasdaq slipped 2.23 points, or less than 0.1%, to 13,610.54. The Russell 2000 small-caps index rose 8.26 points, or 0.4%, to 2,159.70.