The stock market hit a record high yesterday, as the risk of rising interest rates eases and excitement about new, technology-driven business opportunities continues to rise. Early results from our survey of Fortune 500 CEOs shows the vast majority expect their companies’ employment to increase over the next two years. And virtually every CEO I talk to these days is excited by the pace at which technology is transforming their business. Last night, I attended a launch party for a book by three McKinsey consultants called No Ordinary Disruption that captures the growing techno-enthusiasm. James Manyika, one of the authors, called recent advances in machine learning “astounding.” Morgan Stanley CEO James Gorman, also attending, said his board of directors is devoting a half-day session to “disruptive innovation.” “A radically different world is forming,” the McKinsey book portends.
That makes today a good day to read the cautionary note offered by economist Alan Blinder, who points out in The Wall Street Journal that enthusiasm about new technology is found everywhere but in the economic statistics, where productivity has dropped sharply since 2010. That could be a problem with the statistics, he acknowledges. But it could also signal that technological advances and industrial dynamism are not as great as advertised. We recommend you read it.
Enjoy the day, and the weekend.
| Alan Murray | |
| @alansmurray | |
| alan.murray@fortune.com |
Top News
• S&P 500 reaches a record high
The S&P 500 closed at a record high as investors worried less about interest rates and a weaker dollar offered the possibility of stronger sales for U.S. multinationals. The S&P's gain in 2015 now stands at 3%. The dollar, meanwhile, has moved to its lowest since January against a basket of currencies of major U.S. trading partners. That is good news for firms that have large foreign sales. Reuters
• Phantom offer boosts Avon's shares
A bid by a firm calling itself PTG Capital Partners disclosed in a Securities and Exchange Commission filing that it had offered to buy Avon for $18.75 a share. The problem? It was later determined PTG Capital nor the firm's supposed lawyer in the U.S. existed at the locations given in the filing. Avon, which has been under pressure for years, could not even confirm that PTG existed. New York Times (subscription required)
• SABMiller buys London craft brewer
SABMiller, the world's second largest brewer after Anheuser Busch, is buying the largest craft brewer in London -- Meantime. The deal is the first-ever acquisition of a U.K.-brewer for SABMiller. The logic for the acquisition is the same as in the U.S. In a national market that grew by less than 1% last year, Meantime’s sales grew 58%. Fortune
• China cuts down on its coal habit
In the first four months of 2015, China has reportedly consumed almost 8% less coal than in the same period a year earlier, according to a report by Greenpeace/Energydesk China. If the trend continues, China would end 2015 with the biggest cut in both coal use and carbon dioxide ever recorded by a single country, the environmental activist group says.
Quartz
Around the Water Cooler
• Keurig's new device set at chilly price
Keurig Green Mountain's at-home cold drink maker will cost a cool $300. It will dispense carbonated drinks, juices, sports drinks and teas. But analysts were worried about the price. “The biggest question is on price of the machine,” said William Chappell, a SunTrust Robinson Humphrey analyst, echoing the concern of others during the presentation. Fortune
• United Airlines wants to get hacked
The airline is offering free frequent flier miles to would-be hackers who can crack the company's websites and mobile apps. United Airlines and other firms believe they can reduce data breaches by rewarding members of the public for finding security holes in their technology that might have eluded in-house staff. Fortune
• Woes test Bank of America's "fixer"
Of the four biggest U.S. banks by assets, Bank of America is having the most trouble putting the financial crisis in the past. Those struggles are testing Bank of America CEO Brian Moynihan, who has established a longtime reputation as a "fixer" and the patience of shareholders who have grown restless with his progress in turning the company around. Bank of America shares are down 7.7% so far this year, compared with a gain of 2.2% by the big-bank KBW Bank Index. WSJ (subscription required)
• Netflix considers China expansion
Netflix is reportedly in talks with a Chinese media company backed by Jack Ma and other possible partners as it seeks entry into that country's $5.9 billion online video market. Entering China would allow the "House of Cards" broadcaster to take advantage of what is forecasted to be explosive growth in online television in the nation of 1.4 billion people. The market is expected to almost triple by 2018. Bloomberg
Fortune's 5 things to know today
SABMiller gets crafty and B.B. King — 5 things to know today. Today's story can be found here.