Wall Street Breakfast Podcast: Wildfire Costs Blaze

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AccuWeather updates California wildfire damage estimate to $135B-$150B. (00:25) Free speech vs. national security: TikTok heads to Supreme Court over U.S. ban. (01:30) Macy’s to close 66 underperforming stores across U.S. (02:22)

This is an abridged transcript.

The figures being shared about the cost of the Los Angeles wildfires vary but there’s one thing analysts do agree on, the wildfires are expected to be the costliest in U.S. history.

As of Thursday, insured losses were expected to exceed $20B according to J.P. Morgan analyst Jimmy Bhullar. That number doubled his estimate from just a day earlier.

He wrote in a note to clients that insured losses from the wildfires are expected to be confined mostly to his homeowners coverage universe, and less so for commercial property.

Accuweather increased its preliminary estimate of total damage and economic loss to $135-$150 billion. Bloomberg reported that Accuweather Inc. initially estimated the likely cost of the wildfires at $52B-$57B in damage and economic loss.

This topic is the top story in the Wall Street Breakfast newsletter, our daily one-page news summary. A link to sign-up for the newsletter is in show notes.

TikTok’s last-ditch effort to block a potential U.S. ban begins today, when the Supreme Court will hear arguments over the constitutionality of a law requiring the divestment of the social media app from its Chinese parent ByteDance (BDNCE).

The app said it will shut down in the U.S. on January 19, as required by the law, unless the Supreme Court strikes down or delays the deadline. Congress passed the law in April, which mandates the sale of the app to a U.S. company or face a ban due to national security concerns over its foreign ownership.

TikTok has repeatedly argued that the law violates the First Amendment rights of American creators and users.

On the other hand, the Department of Justice said the ban is aimed at protecting American users’ sensitive data and preventing covert manipulation by China.

Macy’s (NYSE:M) is shuttering 66 stores, including nine in New York and nine in California, as part of its ongoing strategy to close 150 underperforming locations through 2026.

The company provided a list of stores on Thursday.

The retailer’s strategy, announced in February, is aimed at returning to sustainable, profitable sales growth and upgrading 350 stores that are more profitable.

Macy’s said a majority of the stores are expected to close in Q1 2025.

There’s a link to the complete list of store closures in this article on Seeking Alpha.

You won’t be able to find Block (NYSE:SQ) under ticker symbol SQ for very much longer.

Block will change its ticker symbol to “XYZ” from “SQ” and SQ2″, reflecting its broader range of businesses beyond its original Square payment system.

The change will become effective on Jan. 21, 2025, for shares trading on the New York Stock Exchange. The change will take effect on Jan. 22 for shares traded on the Australian Securities Exchange.

The company now includes Cash App, Afterpay, and TIDAL, in addition to its Square payment system.

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Catalyst watch:

• Meritage Homes (MTH) will begin trading on a split-adjusted basis following the company’s 2-for-1 stock split.

• Media Day at the Detroit Auto Show could include important updates from General Motors (GM), Ford Motor (F), Stellantis (STLA), Toyota (TM), and Volkswagen (OTCPK:VLKAF). Rivian Automotive (RIVN) plans to showcase the R2 and R3X models at the show.

Now let’s take a look at the markets ahead of the opening bell. Dow, S&P and Nasdaq futures are in the green. Crude oil is up 2.4% at $75/barrel. Bitcoin is up 1.5% at $94,000.

In the world markets, the FTSE 100 is down 0.2% and the DAX is flat.

The biggest movers for the day premarket: Shares of Microvast Holdings (NASDAQ:MVST) surged 44% following the company’s announcement of a major milestone in the development of its True All-Solid-State Battery (ASSB) technology.

On today’s economic calendar:

• 8:30 am Non-farm payrolls. Economists expect the U.S. economy will add 157K jobs to nonfarm payrolls in December, slowing from the initial November estimate of 227K. Meanwhile, the unemployment rate is expected to remain at 4.2%.

• 10:00 am Consumer Sentiment