FINANCE

Banks post second-highest year of profits

The banking industry collectively made $233.1 billion in profits in 2019, the Federal Deposit Insurance Corp. (FDIC) said Tuesday, the industry's second-most profitable year ever. The slight drop in profits from 2018 is due to the drop in interest rates, which happened in the second half of last year. The Federal Reserve cut its benchmark interest rate three times, in an effort to shore up the U.S. economy, which was facing difficulties from the U.S.-China trade war and a slowing manufacturing sector. The FDIC's look at the banking industry reflects a healthy — and incredibly profitable — industry.

PHARMACEUTICALS

Drugmakers settles for $16B in opioid case

The generic drugmaker Mallinckrodt has a tentative $1.6 billion deal to settle lawsuits over its role in the U.S. opioid crisis, it announced Tuesday. The deal is intended to end hundreds of lawsuits faced by the company over opioids. The company said that it had an agreement with a key committee of lawyers representing thousands of local governments suing various drug industry players over opioids — and that the deal has the support of the attorneys general of 47 states and territories. Under its agreement, Mallinckrodt is filing for bankruptcy. The plan calls for it to make payments for eight years after the company emerges from the protections.

retailing

Macy's posts strong 4Q amid struggles

Macy's reported stronger-than-expected sales and profits for the fourth quarter less than a month after it announced a major restructuring. Shares rose 3% before the opening bell Tuesday but gave up those gains along with the broader markets. The quarterly report comes three weeks after the department store chain said it was closing 125 of its least productive stores and cutting 2,000 corporate jobs. The company's net income fell to $340 million, or $1.09 per share, in the quarter ended Feb. 1. That compares with $740 million, or $2.37 per share, in the year-ago period. Net sales were $8.34 billion, down slightly from $8.45 billion a year earlier.

ECONOMICS

U.S. consumer confidence up slightly

U.S. consumer confidence improved slightly in February, rising to a reading of 130.7, the highest point since August. The Conference Board said Tuesday that its measure of consumer sentiment is up from a revised reading of 130.4 in January. The January reading was revised down from an initial estimate of 131.6. Conference Board economist Lynn Franco said that consumers continue to view the outlook as favorable.

Mexico's economy in technical recession

Mexico's economy entered a technical recession and contracted 0.1% in 2019, the first year of President Andrés Manuel López Obrador's six-year term, according to fourth-quarter government figures. Moody's Analytics analyst Alfredo Coutiño wrote in a report that economic activity steadily declined over four consecutive quarters last year, qualifying for the technical definition of a recession — "certainly a moderate contraction, but in the end it is a recession." It was also well short of initial forecasts that Mexico's economy would grow 2% last year.

NEWS SERVICES