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Isn't home where we all want to be? Reba here for realtor.com the Pro's number one most trusted app Finding a home is like dating. You're searching for the one with over 500,000 new listings every month. You can find the one today, download the realtor.com app cause you're nearly home. Make it real with realtor.com Pro's number.
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One most trusted app based on August 2024 proprietary survey. Over 500,000 new listings every month based.
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On average new for sale and rental listings.
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February 2024 through January 2025 what Kleenex maker Kimberly Clark gets out of Buying the company behind Tylenol Plus Young Americans are feeling the economic pinch and that's hitting Chipotle. And three key races in tomorrow's election will gauge voters frustration with the economy.
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Democrats are really unifying around the theme of affordability. They're saying we're the ones who have the plan to lower costs for people.
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It's Monday, November 3rd. I'm Alex Osola for the Wall street, the PM edition of what's News, the top headlines and business stories that move the world today, and one of the biggest takeovers of the year. Kimberly Clark has agreed to buy Tylenol maker Ken View for more than $40 billion. The cash and stock deal would create a company with $32 billion in annual revenue whose brands include household staples like Huggies, Kleenex, Cottonelle toilet paper and Listerine mouthwash. Plus of course, Tylenol. WSJ business reporter Natasha Khan tells us what Kimberly Clark gets out of the deal.
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One of the things that is really interesting about this deal is that Chemview operates in this sort of lucrative area in consumer healthcare. It's not pharmaceuticals, but it's over the counter medicines. It's wellness. Kimberly Clark has said they see a lot more growth opportunities in the consumer health space.
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Kimberly Clark has lagged behind rivals Unilever and Procter and Gamble and Can View's popular health and wellness products could give it a stronger foothold in the consumer healthcare market.
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Their messaging is really on the synergies that can be found in the deal. For example, people buying Huggies diapers could then now also buy Johnson's baby wash or Aveeno baby cream.
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But shares of Kenview, which spun off from Johnson and Johnson in 2023, have been under stress since President Trump said in September that acetaminophen, the active ingredient in Tylenol is is a potential cause of autism.
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So taking Tylenol is not good. I'll say it it's not good.
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Then last week there was a high profile lawsuit against the company. Texas is suing the makers of Tylenol over an unproven link to autism. The Republican attorney general of Texas claims that the companies hid risks that the drug posed to the brain development of children. Natasha said executives talking about the deal with investors and analysts this morning didn't really get into that.
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There were questions that were raised about the risk associated with this ongoing issue with Tylenol, but it was not really addressed.
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Kenview has said the accusations that Tylenol is linked to autism are baseless, and both scientists and medical groups say President Trump's claims are unfounded. Trading on the deal news today, Kenview's shares rose more than 12%, while Kimberly Clark stock slid 14.6%. In broader markets, stocks were mixed after a record setting October, the Dow dropped half a percent while the S&P 500 edged higher and the Nasdaq gained roughly half a percent. And in two updates from Washington, the federal government said today that it will pay some SNAP food benefits for the month of November. A federal judge in Rhode island last week ordered the government to use emergency funds to keep SNAP going during the government shutdown. The government today says There is about $4.7 billion in emergency funding, enough to cover about half of monthly payments for eligible households. SNAP benefits typically total about $8 billion a month for approximately 42 million people. The program, formerly known as food stamps, helps poor and disabled people buy food. The government is warning that there could also be delayed payments in some states. And we're exclusively reporting that hundreds of travel businesses are asking Congress to end the government shutdown by immediately passing a straightforward spending bill. The casinos, hotels and convention bureaus said in a letter to congressional leaders that they're worried about the holiday travel season. Since the shutdown more than a month ago, government employees like air traffic controllers have gone without pay, leading to delays and safety concerns. The business's letter adds to the pressure on Democrats to give up their drive for a broader deal before voting to reopen the government. Burrito change Potle has spent years cultivating younger customers. It's pitched its burritos and bowls as packed with protein for gym bros and healthy eaters and sponsored video game competitions. Some dedicated fans even call themselves the Chipotle Boys. Now, though, that bet seems to be unraveling. The company said last week that customer traffic is sliding and cut a key sales forecast. Chipotle CEO Scott Boatwright said customers who are 25 to 35 years old are pulling back on visits. That customer age group accounts for roughly a quarter of Chipotle Chipotle sales. For more, I'm joined now by Heather Haddon, who covers restaurants for the Journal. Heather, what's behind this drop off in numbers? What's going on here?
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Yeah, Chipotle was pretty frank about it when they talked about this decline in this key segment, 25 to 35 year olds. And they said basically the economy is hitting them. They're having to pay student loans again. Their wage growth isn't growing like it once was. It just seems like this is a demographic that's really feeling pinched right now and they're not spending like they were.
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And is this a decline that is specific to Chipotle or are we seeing it across a number of fast casual restaurants?
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Yeah, we're going to learn more about that this week when sweetgreen and Kava report. But it seems like in general this age group is pulling back on discretionary spending. There's been some other research that shows that restaurants is actually one of the areas that younger consumers think they're going to pull back the most on in the next six months. So restaurants ranked the top in this PwC poll that was just conducted focused on younger consumers. And that's where they see they can save a bit when they're feeling more cash crunched and more conscious of spending right now.
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Let's jump back to Chipotle for a second. What is the company doing about this drop off?
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So Chipotle definitely is responding. They are upping digital deals really targeted towards younger consumers. So this is like trivia games or other things that you can play through Chipotle to get free food. They also have something called Chipotle U, which is encouraging university students to post how much Chipotle they eat and kind of compete internally within a university. And they're also just trying to hold off on price increases. I mean, you know, that does not help Chipotle's margins necessarily because their costs are increasing on a number of fronts. But they think it's really important to prove and to show their value.
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So it sounds like the company is not doing a sort of strategic pivot to court a different demographic. What does this mean for the company's prospects?
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They're still bullish. They said when they're opening new restaurants in the US they're still seeing great returns. They believe that they can get these consumers back. But it is going to take investment. And that is something we'll have to see how investors feel about going forward.
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That was WSJ reporter Heather Haddon. Thank you, Heather.
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Thanks.
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Coming up, the country that might become the first to fall to Al Qaeda. That's after the break.
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Hi, this is Gunjan Banerjee and this is Telus Demos. We're reporters at the Wall Street Journal and The hosts of WSJ's Take Take on the Week.
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Take on the Week is a weekly.
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Show that gives listeners a leg up in the world of markets and investing. From the Fed's moves to market bubbles, we dive into the biggest deals, key players and business news ahead. If you're looking for more news and tools that can help you navigate the markets, consider becoming a subscriber to the Wall street journal. Visit subscribe.WSJ.com takeontheweek to subscribe.
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Al Qaeda militants are moving closer to seizing the capital of the West African nation of Mali, which should the city fall, would become the first country in the world run by the US Designated terrorist group. WSJ Security correspondent Benoit Fokan is here to tell us more. Benoit, I think most listeners might associate Al Qaeda with more of the Middle east than with Africa. What has given the organization a foothold there? What does its presence look like?
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Basically the epicenter of Al Qaeda but also of Islamic State have moved to Africa. There's several reasons for that. One is obviously the kind of weakened states that were unable to reign in these organizations in ways where because of the kind of much bigger military effort put in the Middle east, it was no longer possible for these two organizations, Al Qaeda and Islamic State, to maintain foothold in the Middle East.
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Focusing in on Mali, what is the situation there?
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The jihadists have been having a creeping takeover over the country, meaning they started with an insurgency, you know, in 2012. And gradually, year after year, one village at a time, they moved from the very north, the Sahara, into the south. And now they are the doorstep of the capital. But instead of doing a full out assault, they decided to do a blockade that effectively deprived urban dwellers of fuel. Flour is also becoming rare and it's not only the citizens but also the army that is deprived of fuel resources. So basically paralyzing the central government, Al.
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Qaeda and Islamic State militants are conducting insurgencies across a lot of West Africa. What would it mean for Al Qaeda and its power if they take over Mali?
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It's an organization that doesn't know borders. In fact, it sort of leveraged the fact that these borders are very porous to enable elicit international trade like gold, illicit exports to countries like the uae. So for them There is no border. And if one country falls, then of course, that would embolden them to make another push in other countries, especially Burkina Faso, which is where they're also very powerful. And then remember, they have a template, the Taliban template, an inspiration for this leader of Al Qaeda in Mali. He actually pledged allegiance to the Taliban and said, this is our motto. This is what we want to do.
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That was WSJ security correspondent Benoit Foucault. Thanks, Benoit.
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Thank you.
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And finally, tomorrow is Election day in the US where voters stand can be an indication for their moods ahead of next year's midterm elections and also how they're feeling about President Trump's economic policy. WSJ reporter and editor Aaron Zitner joins me now from Washington. Aaron, what races are you paying attention to?
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We're looking at the election for mayor in New York City, where Zoran Mamdani has created something of a sensation with his aggressively progressive freeze the rent free childcare free fast buses agenda races for governor in Virginia and New Jersey. Those are usually big races we look at. They always come one year after a presidential election.
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So affordability has been a key element in a number of these races. What are you going to be paying attention to to see how that plays out and how does that relate to President Trump's handling of the economy?
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These elections come at a, in some ways, unexpected moment for Donald Trump. Here's the businessman president, the president who said he would use his business savvy to lower the cost of living for the country. And instead what we find is that voters are very dissatisfied with his handling of the economy, of tariffs and especially of inflation. In some polls, the disapproval is 30 points higher than approval on his handling of cost of living and inflation. Democrats are really unifying around the theme of affordability. They're saying we're the ones who have the plan to lower costs for people, whether it's Zuran Mamdani who would tax the wealthy and raise the corporate income tax in New York to fund his proposals, or whether it's a more centrist proposal like, say what we're seeing from Abigail Spanberger, the Democrat in Virginia, who's going after things like the middlemen in the pharmaceutical supply chain to lower pharmaceutical costs. Let's ease permitting and zoning restrictions for allowing certain kinds of housing to be built to make housing more affordable, a more centrist agenda.
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And so what are you going to be watching in those three races in particular tomorrow?
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The big elections in 2026 are the Democrats chance to really check the power of Donald Trump if they can pick up more House and Senate seats. And what we'll be looking for on Tuesday is what can we see now in the enthusiasm of each party to vote?
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That was WSJ reporter and editor Aaron Zitner. Thanks so much, Aaron.
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Good to be with you.
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And that's what's news for this Monday afternoon. Today's show is produced by Pierre Bienname with supervising producer Tali Arbel. I'm Alex Osola for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.