World Street | Dow's longest losing run since 1978, Nissan-Honda's merger talks and more

World Street offers a sneak peek into the world of business and economy.

The Dow Jones Industrial Average extended its losing run to the ninth straight session, its longest since 1978. Reports suggests that two of Japan's top automakers--Honda Motor Co and Nissan Motor Co are likely in talks to a merger to create an even bigger entity to take on Toyota Motor Corp. Shares of Nvidia slipped deeper into the correction territory as investors ran to take profits off its record bull run this year. Grubhub has agreed to pay $25 million in a settlement with the FTC over allegations of engaging in harmful practices that negatively impacted diners and workers.

Freefall

The Dow Jones Industrial Average made headlines on Tuesday by recording its first nine-day losing streak since 1978. This downward streak began shortly after the Dow crossed the 45,000 milestone earlier this month.

Interestingly, the Dow's slump contrasts with the broader market's performance. The S&P 500 reached a record high on December 6 and remains just shy of that level, while the Nasdaq hit a new peak on Monday. The Dow's decline is driven by a market shift favoring technology stocks over traditional "old-economy" stocks, which had rallied in November following Donald Trump’s reelection. These older stocks form a significant portion of the Dow, making it more vulnerable to the rotation away from them.

Shaking hands

Japanese automakers Nissan Motor and Honda Motor are reportedly preparing to negotiate a potential merger to strengthen their competitiveness in the rapidly evolving global automotive industry, according to a report by the Nikkei on Tuesday.

The companies are exploring the possibility of operating under a holding company and are expected to sign a memorandum of understanding in the near future. Additionally, they aim to integrate Mitsubishi Motors, where Nissan holds a 24 percent stake as the largest shareholder, into the holding company structure. If finalised, the combined Nissan-Honda-Mitsubishi entity would represent an automotive powerhouse, with annual vehicle sales exceeding 8 million units, as reported by Nikkei.

Get low

Nvidia shares dropped over 1 percent on Tuesday, while Broadcom also saw earlier gains erased, closing in the red.

On Monday, Nvidia officially entered correction territory, a threshold marked by a stock falling 10 percent or more from its all-time high. The company's peak closing price of $148.88 was recorded last month.

Heavy penalty

Grubhub will pay $25 million to settle an FTC and Illinois Attorney General lawsuit over alleged deceptive practices affecting diners, workers, and small businesses. The complaint accuses Grubhub of misleading diners about delivery costs, deceiving drivers about earnings, and listing restaurants without permission. FTC Chair Lina Khan stated the company’s actions harmed customers, drivers, and non-partner restaurants to boost growth.

Mass exodus

China experienced its largest-ever financial market outflows last month, with domestic banks transferring a net $45.7 billion overseas for securities investments, according to the State Administration of Foreign Exchange. This figure reflects both foreign exits from China and local investments in overseas assets.

The outflows highlight growing concerns over the Chinese economy as President-elect Donald Trump’s proposed 60 percent tariffs on Chinese goods threaten trade. Weakness in the yuan, declining local stocks, and a widening interest-rate gap with the US are amplifying fears of a capital flight spiral.