The Dow Jones Industrial Average (DJINDICES:^DJI) was clinging to a small gain Friday morning on a shortened post-Thanksgiving trading day for the stock market. The Dow was up about 0.18% at 11:05 a.m. as it underperformed the other major indices. The market may be getting a boost from recent comments by President Trump suggesting that he will at least informally accept the results of the election if the Electoral College elects Joe Biden as President when it votes in December.
Shares of Disney (NYSE:DIS) were down on Friday after the company used its annual filing to disclose an increased number of layoffs scheduled for the coming months. Meanwhile, Apple (NASDAQ:AAPL) stock rose as the company reportedly moves some non-iPhone production out of China.
Disney ramps up job cuts
It was reported in September that Disney planned on laying off 28,000 employees due to the impacts of the COVID-19 pandemic. That number has now jumped to 32,000, according to the company's recently filed annual report.
Disney plans to cut approximately 32,000 jobs in the first half of fiscal 2021. These job cuts will primarily hit the parks, experiences, and products segment. Disney was able to reopen its Disney World resort in Florida earlier this year, albeit with capacity constraints and other restrictions in place. The company has been unable to reopen Disneyland in California due to that State's stricter rules.
With COVID-19 surging in many parts of the country and widespread availability of a vaccine still probably months away, it's unlikely that Disneyland will be open in the near term. The company may even be forced to reclose Disney World, although that depends on the willingness of Florida officials to put new restrictions in place.
Disney's report also outlined the scope of the furloughs for employees who aren't being laid off. As of Oct. 3, about 37,000 employees who aren't scheduled for termination were on furlough. Some of those furloughs could turn into layoffs down the road if the situation at the parks doesn't improve.
Despite the parks business being bludgeoned by the pandemic, Disney stock is trading close to an all-time high. Shares of Disney were down about 0.5% Friday morning; the stock is up slightly since the start of the year.
Apple shifting some production out of China
Reuters reported on Thursday that tech-giant Apple has told supplier Foxconn to move some iPad and MacBook assembly work out of China to Vietnam. The goal of the move is likely related to reducing risks if the trade war between the U.S. and China heats up.
Reuters' source said that Foxconn was building assembly lines for iPad's and MacBooks at an existing plant in Vietnam's Bac Giang province, with plans to begin production sometime in the first half of 2021. The source said the new lines would replace some production from China, but Reuters couldn't learn the scope of the production shift. Neither Foxconn nor Apple responded to Reuters' requests for comment.
Apple has been dealing with an environment where import tariffs have been placed on some electronics made in China, and certain Chinese companies have been restricted from using components built with U.S. technology. While the end of the Trump administration in January could lead to better trade relations, it's not a guarantee. And given that shifting production for a company with the scale of Apple can take a lot of time and effort, Apple likely wants to diversify its production geographically now in case trade relations sour further in the future.
Shares of Apple were up about 0.9% Friday morning. The stock remains one of this year's big winners in the world of big tech, up about 60% so far.