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Update on the latest business

November 15, 2018

FINANCIAL MARKETS

Stocks struggle higher

NEW YORK (AP) — Stocks have been searching for direction on Wall Street, sinking at the open, regaining much of the losses by midday before sinking again.

The market is currently on a five-day losing streak.

Power provider PG&E lost another one-fourth of its value as concerns mounted over whether it could sustain losses related to California’s devastating Camp Fire.

The British pound fell and British bank stocks plunged after two Cabinet ministers quit, throwing the country’s plans for leaving the European Union into turmoil. The disarray is raising questions over London’s future as a financial center.

BREXIT

UK’s May vows ‘to see this through’ on Brexit

LONDON (AP) — British Prime Minister Theresa May says if politicians reject her Brexit deal, it will set the country on “a path of deep and grave uncertainty.”

Defiant in the face of mounting criticism, May says she believes “with every fiber” of her being that the deal her government struck with the European Union was the right one.

Two Cabinet ministers have resigned in the 24 hours since the government backed the deal announced Tuesday. An increasing number of lawmakers from May’s Conservative Party are calling for a no-confidence vote on the prime minister.

She tells reporters she isn’t planning to give up and would resist a leadership challenge, saying “Am I going to see this through? Yes.”

RETAIL SALES

US retail sales rose a solid 0.8 percent last month

WASHINGTON (AP) — U.S. retail sales rose at a healthy pace in October, though the gains were likely boosted by one-time factors such as hurricane recovery spending and higher gas prices.

The Commerce Department said Thursday that retail sales rose a seasonally adjusted 0.8 percent last month, following two months of slight declines. Excluding gasoline sales, which were inflated by higher prices, sales climbed a still-solid 0.5 percent.

The figures suggest that consumers are spending at a modest pace, fueled by steady job gains and mild wage increases. Americans lifted their spending over the summer and fall at the fastest six-month pace in four years. Yet business spending on machinery, computers and buildings barely increased in the July-September quarter, leaving consumers shouldering more of the burden of maintaining growth.

CALIFORNIA PESTICIDE RESTRICTION

APNewsBreak: California aims to restrict popular pesticide

LOS ANGELES (AP) — California regulators are recommending new restrictions on a widely used pesticide blamed for harming babies’ brains.

The Department of Pesticide Regulation is issuing temporary guidelines Thursday for chlorpyrifos (klohr-PY’-rih-fohs) while it considers long-term regulations.

The department is calling for a ban on using the chemical in crop dusting, discontinuing its use on most crops and increasing buffer zones around where it’s applied.

The pesticide is currently used on about 60 different crops, including grapes, almonds and oranges.

The action comes as the Dow Chemical Co. pesticide is increasingly under fire.

A federal appeals court in August ruled the Trump administration endangered public health by keeping the pesticide on the market despite extensive evidence showing harm to babies.

Hawaii passed legislation in June to ban its use.

MORTGAGE RATES

US average mortgage rates flat to higher; 30-year 4.94 pct.

WASHINGTON (AP) — U.S. long-term mortgage rates were steady to slightly up this week, at their highest levels in nearly eight years and dampening home sales.

Mortgage buyer Freddie Mac says the average rate on a 30-year, fixed-rate mortgage was unchanged from last week at 4.94 percent. That’s the highest level for the benchmark rate since February 2011. A year ago the rate stood at 3.95 percent.

The average rate on a 15-year, fixed-rate loan rose to 4.36 percent from 4.33 percent last week.

Anxiety over rising interest rates, reflecting strength in the economy, and expectations of additional rate increases by the Federal Reserve have roiled financial markets in recent weeks and spilled over into the housing market. The higher home borrowing rates have kept many potential buyers on the sidelines.

EARNS-WALMART

Walmart sales strong, both online and in stores

BENTONVILLE, Ark. (AP) — Walmart, armed with an arsenal of grocery and other online services, is proving it can do battle with online behemoth Amazon.

The world’s largest retailer delivered a strong third-quarter financial report on Thursday, extending a long-running streak of strong sales growth that showed it’s pulling shoppers online and in the store. It also raised profit expectations for the year heading into the holiday shopping season.

Walmart posted third-quarter earnings of $1.71 billion, or 58 cents per share.

Earnings, adjusted for non-recurring costs, came to $1.08 per share, which is 6 cents better than expected, according to a survey by Zacks Investment Research.

Walmart Inc. says it now expects full-year earnings in the range of $4.75 to $4.85 per share.

EARNS-JC PENNEY

JC Penney withdraws profit guidance, cuts sales outlook

PLANO, Texas (AP) — Shares of J.C. Penney have plunged after the company withdrew profit guidance and lowered its sales expectations for the year.

The company on Thursday reported a loss of $151 million in its third quarter, or 48 cents per shares. Losses, adjusted for one-time gains and costs, were 52 cents per share, which is a nickel better than analysts had expected, according to a survey by Zacks Investment Research.

Revenue of $2.73 billion fell short of Wall Street expectations of $2.81 billion.

SHORT-TERM RENTALS

City votes to impose restrictive rules on short-term rentals

WASHINGTON (AP) — The Washington city council has voted to impose tight limits on Airbnb and other short-term rental companies.

News outlets report the D.C. City Council voted unanimously Tuesday to restrict short-term rentals to primary residences, and limit rentals in which the owner is absent to 90 days per year. The bill also prohibits property owners from renting out second homes for short periods of time.

Supporters of the limits say short-term rentals make real estate more expensive for would-be buyers.

Mayor Muriel Bowser said the bill is too restrictive. The council has the votes to override a veto.

Airbnb spokeswoman Crystal Davis says the council is “depriving D.C. residents of $64 million in supplemental income annually.”

Airbnb sued the city of Boston in federal court Tuesday over a similar measure.

FDA-SMOKING FLAVORS

FDA to crack down on menthol cigarettes, flavored vapes

NEW YORK (AP) — A top U.S. health official is pledging to try to ban menthol from regular cigarettes, outlaw flavors in all cigars and tighten rules regarding the sale of most flavored versions of e-cigarettes.

Scott Gottlieb of the U.S. Food and Drug Administration disclosed the plans on Thursday.

The move represents a major step to further push down U.S. smoking rates, which have been falling for decades.

The restrictions are mainly aimed at reducing smoking in kids: About half of teens who smoke cigarettes choose menthols and flavored e-cigarettes have been blamed for a recent increase in teen vaping rates.

CHINA-HOTEL SCANDAL

Hotels apologize in China after video shows how they clean

BEIJING (AP) — At least four major international hotel chains have apologized after a hidden camera video of their room cleaning practices in China was posted online.

The Shangri-La Hotel in Fuzhou said Thursday that what’s shown in the video violates its hygiene standards, while the Park Hyatt in Beijing called it an isolated occurrence. The Waldorf Astoria in Shanghai and the Sheraton in Guiyang city also apologized.

The 11-minute video shows cleaners wiping cups and sinks with dirty towels and sponges. Some use the same towel to wipe the toilet seat.

An activist blogger who uses a pseudonym posted the video late Wednesday on his verified account on Weibo, a Chinese version of Twitter. It was picked up by Chinese media and had been shared 78,000 times by Thursday afternoon.

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