Category: ECONOMY

Morgan Stanley Eliminates About 1,500 Jobs in Year-End Cuts

Morgan Stanley is cutting about 1,500 jobs globally, including several managing directors, as part of a year-end efficiency push.

The cuts are skewed toward technology and operations divisions, but also include executives in sales, trading and research operations, people with knowledge of the matter said. The reductions amount to about 2% of the firm’s workforce, according to one of the people, who asked not to be identified because the information is private. The bank plans to take a charge in the range of $150 million to $200 million in its fourth-quarter results tied to the cost of the cuts, one person said.

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Empty container movements signal freight shift to the East Coast

Like a pendulum that reached its maximum height in one direction that has begun to accelerate towards equilibrium, volumes of empty containers are shifting to the East Coast over the past few weeks.

The number of empty containers moving into the Elizabeth New Jersey market over the past two weeks has almost tripled, while inbound empties moving to the Los Angeles market has dropped 46%. Pair that with the fact outbound Los Angeles trucking volumes have dropped approximately 14% since the start of November, it seems the country’s capacity is in need of re-balancing. The question to ask is whether this is a proactive or reactive move to import behaviors by the large shipping companies and what does this mean for domestic freight.

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Thanksgiving Day shopping frenzy tops record with $4.1B spent

Shoppers on Thursday weren’t slowed down one bit by their huge turkey feasts.

Consumers spent a staggering $4.2 billion online on Thanksgiving, a 14.5 percent from last year and a record high, according to new figures published by Adobe Analytics on Friday. This marks the first time that Thanksgiving shopping has surpassed $4 billion.

In total, e-commerce behemoths saw a 244 percent boost in sales on Thanksgiving, while smaller retailers experienced a 61 percent jump.

Phones played a huge role in the spike in Turkey Day shopping: Overall, nearly half of the revenue — 44.9 percent — stemmed from people’s smartphones, a 24.4 increase over last year.

“Thanksgiving … has fast become a favored day by consumers for accelerating their holiday spending and shopping efforts,” Jason Woosley, vice president of commerce and platform at Adobe, said in a statement. “Don’t expect the momentum to slow down anytime soon.”

Black Friday sales are on track to hit $7.4 billion; as of 9 a.m. ET on Friday, shoppers already spent $600 million online, representing a 19.2 percent increase from last year.

The full holiday season — which is six days shorter than is typical, because Thanksgiving fell on the fourth Thursday in November, the last possible date it could be — is expected to bring in $143.7 billion in online spending. That’s a 14.1 percent increase compared to 2018.

Boscov’s, the largest family-owned department store chain in America, saw “very healthy” sales increases on Thursday evening and Friday, CEO Jim Boscov told FOX Business.

The company, which has more than four-dozen stores across the mid-Atlantic, has worked hard to shield shoppers from rising costs, a result of the billions of dollars stemming from the U.S.-China trade war.

“So much of the year’s business is done in these few weeks” that it’s important to limit price increases in the period as much as possible, Boscov said. Some of the levies could be avoided by placing orders before they took effect, he said, and suppliers sometimes absorbed the impact if their profit margin was sufficient.

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Target’s apparel sales are on fire. And that’s bad news for everyone else

While Walmart is finding strength in grocery, Target is finding it in apparel.

The retailer said the apparel category reaped the most “dramatic” market share gains in the latest quarter, when it reported earnings on Wednesday. It said apparel sales were up more than 10%, which also helped strengthen Target’s profit margins.

Clearly, Target’s efforts to get back to being known as “cheap chic” are working.

In the fashion department, it has refreshed stores to make individual brands look more like their own mini boutiques, with more mannequins and table displays showing off merchandise. It has launched dozens of in-house apparel brands over the past three years, such as “A New Day” for women, “Auden” for lingerie and Goodfellow & Co. for men. They’re all reasonably priced, with guys’ winter sweaters selling for under $30 and a women’s party skirt for $27.99.

Notably, Target is succeeding at a time when others are struggling to sell clothes.

Teen apparel retailer Forever 21 has filed for bankruptcy. And Kohl’s, when it reported earnings Tuesday, said women’s apparel was its weakest category during the period. Gap’s brands, including what had been its fast-growing Old Navy label, are struggling. Dressbarn is wrapping up liquidation sales at its remaining stores. Amazon keeps trying to grow in fashion but has struggled to persuade shoppers to buy more than basic apparel from its site.

“I think our commitment to our new store operating model, where we have dedicated business owners in that apparel category … is really driving great results,” Target CEO Brian Cornell said on a post-earnings call with analysts. “The combination of the work we’ve done with our own brand assortment, adding some new national brands like Levi’s in select stores, the service that we’re delivering in store, and the inspiration we’re creating online has really come together.”

CONTINUE @ CNBC

Party City’s October sales a ‘disaster’ with Halloween stores down 21%

  • Party City reported a “disappointing” third quarter on Thursday, in the words of CEO James Harrison. Revenue was down 2.3% year over year, to $540.2 million, and retail sales down 1.7%. Comp sales were down 2.6% in Q3, which ended Sept. 30.
  • Worse, the party retailer reported in the same press release that its October sales — with the all-important Halloween holiday — fell 7% to $432.6 million, while retail sales fell 8%. Comps were down 4.9% for the month despite a 15.3% increase in e-commerce. Halloween City sales per store decreased 20.8% from the prior year.
  • The company’s earnings announcement, which included reduced sales and profit estimates for the year, led to a sell off of Party City stock, with share prices down by as much as 67% since Wednesday. Sustained declines throughout the year in the company’s market cap — a measure of its total value on the stock market — led the company to post a $259.1 million write-off in goodwill during Q3.

Dive Insight:

Debtwire retail analyst Philip Emma described the market’s perception of Party City’s performance as “a disaster” in an emailed client note. Along with the precipitous drop-off in stock price, market prices for the company’s debt are also “down substantially,” Emma noted.

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Merry Christmas: Sears is laying off hundreds of corporate employees after announcing 96 store closings

Sears is laying off hundreds of corporate workers less than a week after announcing a new round of store closures, the company confirmed to Business Insider.

The layoffs impacted workers at Sears’ headquarters in Hoffman Estates, Illinois, as well as the company’s offices in San Francisco. The total number of laid-off employees is fewer than 300, according to a source with direct knowledge of the staffing changes.

Some employees were informed of the layoffs in a group meeting.

At the company’s San Francisco office, about two dozen employees were called into a room on Wednesday, where representatives announced that they would all lose their jobs, according to someone who attended the meeting and requested anonymity.

“It was a group layoff,” this person said. “There was a heartfelt apology, but that was it. … It was very abrupt, very quick.”

No individual meetings were held because “everyone was in the same boat,” this person said.

Sears’ parent company, Transformco, which also owns Kmart stores, confirmed the layoffs in a statement to Business Insider.

CONTINUE @ BI