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Update on the latest business

May 17, 2018

FINANCIAL MARKETS

Stocks waver

NEW YORK (AP) — Stock indexes have been moving between small gains and losses as Wall Street traders weigh the latest company earnings and deal news.

Energy and industrial companies rose, offsetting losses in utilities and real estate companies. Energy stocks were rising along with the price of crude oil.

Small-company stocks were faring better than the rest of the market.

Bond prices fell. The yield on the 10-year Treasury edged up to 3.11 percent.

Britain’s main stock market closed at a record high. The FTSE 100 index ended Thursday’s session 0.7 percent higher at 7,787.97, surpassing its previous peak of 7,778 in mid-January.

MORTGAGE RATES

US average mortgage rates at 7-year highs; 30-year 4.61 pct.

WASHINGTON (AP) — Long-term U.S. mortgage rates jumped this week, marking their highest levels in seven years amid the peak home buying season.

The benchmark 30-year rate pushed toward the significant 5 percent level. Mortgage buyer Freddie Mac says the average rate on 30-year, fixed-rate mortgages was 4.61 percent, up from 4.55 percent last week. The new average rate was the highest since May 19, 2011. By contrast, the 30-year rate averaged 4.02 percent a year ago.

The average rate on 15-year, fixed-rate loans climbed to 4.08 percent from 4.01 percent last week.

The latest indications of a strong economy and rising commodity prices — gasoline is at a four-year high — lifted yields on bonds and mortgage rates followed suit.

EARNS-WALMART

Walmart beats all around, with online sales rebounding

NEW YORK (AP) — Walmart is reporting better-than-expected profit and revenue for the first quarter with rebounding online sales.

Revenue at Walmart stores opened at least a year rose a solid 2.1 percent. Online sales rose 33 percent, a strong showing after a disappointing 23 percent increase in the final quarter of last year.

It’s an encouraging report as Walmart searches for solid footing in a rapidly changing environment that includes a dominant Amazon.com.

Walmart expects 40 percent growth in online sales this fiscal year, but it’s a distant second to Amazon.

Since buying Jet.com for more than $3 billion nearly two years ago, Walmart has continued to buttress its presence online, acquiring brands like Bonobos and ModCloth. It has vastly increased the number of goods its sells outside of its stores.

It’s also strengthening delivery to make shopping at Walmart even more attractive.

EARNS-JC PENNEY

Mixed news from JC Penney

PLANO, Texas (AP) — J.C. Penney is reporting a first-quarter loss along the lines of what analysts had expected, but also strong revenue. However, the company’s outlook for the year is short of most projections.

The loss was $78 million, or 25 cents per share. The loss, adjusted for one-time items, was 22 cents per share.

The Plano, Texas, department store posted revenue of $2.67 billion, beating projections of $2.6 billion, according to a survey by Zacks Investment Research.

J.C. Penney Co. expects full-year results to range from a loss of 7 cents per share to earnings of 13 cents per share.

KROGER-OCADO

Kroger, fending off online rivals, ups stake in UK’s Ocado

CINCINNATI (AP) — Kroger is upping its investment in the British online grocer Ocado as it fends off Amazon.com and other online threats to traditional grocers.

Kroger said Thursday that a subscription rights agreement will give it access to Ocado’s online ordering, automated fulfillment and home delivery technology in the U.S.

Kroger Co. and Ocado will choose three sites for development of new, automated warehouse facilities in the U.S. They’ll identify up to 20 over the first three years of the deal.

The threat to traditional grocers became crystal clear after Amazon’s $16 billion acquisition of Whole Foods. Kroger is also in competition with Walmart and Target.

Shares of Kroger, based in Cincinnati, rose nearly 3 percent in premarket trading. Ocado Group Plc. soared 50 percent in London.

BJ’S WHOLESALE-IPO

BJ’s Wholesale Club going public, again

UNDATED (AP) — BJ’s Wholesale Club is going public. Again.

BJ’s has announced that it filed a form S-1 with the U.S. Securities and Exchange Commission for an initial public offering. The company, which operates 215 wholesale membership warehouses on the East Coast, didn’t say how many shares it would offer or what the price range might be. The offering is expected this year.

The Westborough, Massachusetts was acquired in 2011 for $2.8 billion by CVC Capital Partners and Leonard Green & Partners, which then took BJ’s private. The buyers reportedly put BJ’s up for sale last year for more than $4 billion but got no takers.

Before going private in the fall of 2011, the retailer rejected an offer of $3 billion from Walmart, according to FactSet.

JAPAN-TOSHIBA

Toshiba’s chip sale to consortium wins regulatory approval

TOKYO (AP) — Japanese electronics company Toshiba Corp. says the sale of its computer memory chip business to a consortium led by Bain Capital Private Equity has cleared all anti-trust regulatory approval, including a final one it was awaiting from China.

Toshiba said Thursday that means the deal, valued at 2 trillion yen ($18 billion), can now close by June 1.

Tokyo-based Toshiba, which also has railroad and nuclear energy units, has been counting on the deal for a turnaround.

Its U.S. nuclear operations at Westinghouse Electric Co. filed for bankruptcy last year.

Initially, Western Digital opposed the sale of the NAND flash-memory SanDisk joint venture, starting lawsuits.

Toshiba first announced the sale in September last year. The dispute with Western Digital was settled late last year.

FACEBOOK PRIVACY SCANDAL

Zuckerberg to heading to EU next Tuesday

LONDON (AP) — Facebook CEO Mark Zuckerberg will meet with leaders of the European parliament in a closed-door meeting next Tuesday about the data protection scandal that has engulfed his company.

Even though his visit had been announced, it was left unclear exactly when Zuckerberg would visit the European Union legislature.

The EU and British parliaments have been calling for Zuckerberg to appear before them for weeks ever since it emerged that a company, political consultants Cambridge Analytica, had been allowed to misuse the data of millions of Facebook users.

The EU meeting however is set to be private with the leaders of the political groups and a justice and civil rights expert. Many in the European Parliament had been calling for a public hearing.

CBS-NATIONAL AMUSEMENTS-LAWSUIT

Judge denies CBS restraining order against major shareholder

DOVER, Del. (AP) — A Delaware judge has refused to grant CBS Corp. a restraining order against its majority shareholder in a power struggle that could decide control of the company.

The judge said Thursday there was no court precedent to grant the relief CBS sought in trying to prevent National Amusements Inc. from trying to thwart a board vote scheduled for later Thursday on a dividend that would dilute National Amusement’s preferred stock voting power from 80 percent to 17 percent, effectively giving CBS independence.

National Amusements responded to CBS’s lawsuit by rewriting company bylaws to require a “supermajority” to approve the dividend.

While denying the restraining order, the judge noted CBS could still file a court challenge if NAI takes actions inconsistent with its fiduciary obligations to the company and other shareholders.

FOX NEWS-SCOTT

Fox names veteran exec Suzanne Scott as new CEO

NEW YORK (AP) — Fox News has named Suzanne Scott as its new chief executive officer. She’s been with Fox since the cable news network started in 1996, and has most recently been co-president of Fox News following the exit of founding CEO Roger Ailes.

Scott’s former co-president, Jack Abernethy, will move back to his old role as CEO of the Fox-owned television stations and move to Los Angeles.

Fox also named Jay Wallace as president and executive editor of Fox News, giving him control of the network’s news product and reporting to Scott.

The move to put executives in place comes a day after Lachlan Murdoch was named chairman and CEO of the newly restructured Fox, which includes the broadcast entertainment network and several cable channels.

MISS AMERICA-FEMALE LEADERSHIP

APNewsBreak: Miss America taps women for leadership spots

ATLANTIC CITY, N.J. (AP) — The Miss America Organization is putting women in its three top leadership positions following an email scandal involving former male leaders of the scholarship group.

The organization tells The Associated Press it is appointing Regina Hopper as president and CEO of the Miss America Organization, and Marjorie Vincent-Tripp as chairwoman of the board of the Miss America Foundation.

Coupled with Gretchen Carlson leading the Miss America Organization’s board of trustees, the group is moving on from the email scandal with women firmly in charge.

Hopper, a former Miss Arkansas and TV journalist, replaces Sam Haskell, whose emails about the intellect, appearance and sex lives of former Miss Americas led to his departure and a revamping of the group’s top leadership in December.

NCAA-SPORTS GAMBLING-HOSTS

NCAA opens door to title games for states with sports bets

INDIANAPOLIS (AP) — The NCAA is opening a door for states with legalized sports gambling to host NCAA championship events.

The governing body for college sports on Thursday announced a “temporary” lifting of a ban that prevented events like college basketball’s NCAA Tournament from being hosted in states that accept wagers on single games. The move comes three days after the Supreme Court overturned a federal law that barred most states from allowing gambling on professional and college sports.

NCAA President Mark Emmert says the board of governors will consider permanently revising its policy at future meetings. But the NCAA says it will not change its rules that prohibit gambling on sports by athletes and all athletic department employees, including coaches.

Emmert also is calling for federal regulations of sports gambling, joining the NFL, NBA and other leagues.

SMART CITY-COLUMBUS

Ohio capital launches unique “Smart City” operating system

COLUMBUS, Ohio (AP) — Ohio’s capital city has unveiled the first version of its pioneering transportation operating system.

Columbus beat out six other cities in 2016 to win the U.S. Department of Transportation’s Smart City Challenge. It received a $40 million federal grant and $10 million from Vulcan Inc. to implement data-driven ideas that make transportation safer, easier and more reliable.

Smart Columbus said Thursday that the first-of-its-kind operating platform will pave the way for the public and private sectors to integrate transportation technologies such as self-driving cars, connected vehicles and smart sensors into the city’s transportation network.

Mayor Andrew Ginther says it should allow Columbus to improve city services and residents’ quality of life.

The other cities that applied were San Francisco; Pittsburgh; Denver; Portland, Oregon; Austin, Texas; and Kansas City, Missouri.

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