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Update on the latest business

March 4, 2019

FINANCIAL MARKETS

Stocks plunge in midday trading

NEW YORK (AP) — Stocks are sharply lower on Wall Street at midday, erasing an early rally, as traders wait to if any details emerge about progress being reported in trade talks between the U.S. and China.

Technology, health care and communications companies gave back the most.

Salesforce.com, UnitedHealth Group and AT&T were all trading lower.

TRUMP-RUSSIA PROBE

House launches new probe

WASHINGTON (AP) — A House panel is launching a sweeping new probe of President Donald Trump, his White House, his campaign and his businesses.

The House Judiciary Committee is sending document requests to 81 people linked to the president and his associates.

House Judiciary Committee Chairman Jerrold Nadler says the investigation will be focused on obstruction of justice, corruption and abuses of power. The aggressive, broad investigation could set the stage for impeachment, although Democratic leaders have pledged to investigate all avenues and review special counsel Robert Mueller’s report before taking drastic action.

Nadler said today’s document requests are a way to “begin building the public record” and the committee has the responsibility to investigate. Nadler also said it’s “very clear” Trump obstructed justice.

Nadler said the House Judiciary Committee wants to review documents from the Justice Department, the president’s son Donald Trump Jr. and Trump Organization chief financial officer Allen Weisselberg. Former White House chief of staff John Kelly and former White House counsel Don McGahn also are likely targets.

The White House says it has received the House Judiciary Committee’s letter requesting documents related to the Trump administration, family and business as part of an expanding Russia investigation.

White House press secretary Sarah Sanders the White House counsel’s office and relevant officials will review the letter and respond at the appropriate time.

CONSTRUCTION SPENDING

US construction spending drops 0.6 percent in December

WASHINGTON (AP) — U.S. construction spending edged down 0.6 percent in December with declines in residential construction and government projects. Even with the December setback, construction spending for all of 2018 reached record levels, though it was the smallest increase seven years.

Residential construction fell by 1.4 percent, revealing ongoing struggles in the housing sector. Nonresidential activity rose 0.4 percent, while spending on government projects fell 0.6 percent, with both federal and state and local activity falling.

For the year, construction spending rose 4.1 percent to $1.3 trillion. It was an all-time high, but the 4.1 percent gain was the weakest performance since 2011.

The December construction spending report was one of a number of government reports that have been delayed because the 35-day partial government shutdown.

OPIOID LAWSUIT-PURDUE PHARMA

OxyContin maker: Lawsuit distorts facts, scapegoats company

UNDATED (AP) — OxyContin maker Purdue Pharma is asking a court to throw out a lawsuit filed by Massachusetts’ attorney general that accuses the company, its owners and top executives of deceiving patients and doctors about the risks of opioids.

Purdue argues the lawsuit distorts facts, mischaracterizes internal company documents and makes oversimplified claims while attempting to cast the Connecticut-based firm as a scapegoat for the deadly opioid addiction crisis.

A spokeswoman for Democratic Attorney General Maura Healey said the state would fight Purdue’s bid to throw out the case. The state claims the company told doctors OxyContin had a low addiction risk and pushed prescribers to keep patients on the drug longer.

More than 1,000 state and local governments have lawsuits pending against drugmakers, most naming multiple defendants.

BREXIT

UK, EU to hold more Brexit talks as May woos opposition

LONDON (AP) — British opposition politicians are accusing Prime Minister Theresa May of trying to bribe them into voting for her Brexit deal.

The government on Monday announced a $2.1 billion package of funding over several years to help regenerate run-down communities.

Many are in areas of England represented by the opposition Labour Party, and the move is being seen as a bid to win support from their lawmakers for May’s withdrawal agreement with the European Union.

Britain is due to leave the EU on March 29, but Parliament has so far rejected May’s deal, raising the prospect of a chaotic, economically damaging departure from the bloc.

Labour lawmakers reacted coolly to the announcement. Chris Bryant called the money “corrupt, patronizing, pathetic” and “all to appease the Brexit monster.”

GENERAL MOTORS RESTRUCTURING

Production ending at Ohio plant this week

LORDSTOWN, Ohio (AP) — General Motors says production will end this week at one of five North American plants that it wants to close by next January. A GM says the last Chevrolet Cruze will come off the assembly line this Wednesday at its Ohio assembly plant near Youngstown.

The plant closings are part of a major restructuring under way for the Detroit-based automaker.

GM is shifting its focus to making trucks, SUVs and electric and autonomous vehicles.

The plant closings in the U.S. still must be negotiated with the union so some workers at GM’s Lordstown plant in Ohio are hoping it still can be saved.

The plant that employed more than 4,000 workers just a few years ago has been down to 1,400 hourly employees in recent months.

ELI LILLY-INSULIN PRICE CUT

Lilly to sell cheaper version of top-selling insulin Humalog

INDIANAPOLIS (AP) — Eli Lilly is offering a half-price version of its top-selling insulin Humalog as drugmakers face growing pressure to control prices.

The company says it will introduce a version of the diabetes treatment called Insulin Lispro with a list price 50 percent lower than its current rate of about $275 per vial.

The discounted insulin will sell for roughly $137 per vial or $265 for a five pack of Kwik Pens. A company spokeswoman said the average person uses about two vials a month, and the pack of pens can last a month or more.

The company said it is working to make the insulin available as quickly as possible.

Lilly Chairman and CEO David Ricks said that the company pays “significant” rebates off the list price, but those discounts do not directly benefit all patients.

Lilly and other drugmakers have been targeted by protesters over soaring prices for some of their products. They’ve become frequent targets of President Donald Trump, and drug company leaders have been called before Congress and grilled about their prices.

CHINA-HUAWEI

China accuses detained Canadians of stealing state secrets

BEIJING (AP) — China has accused two detained Canadians of acting together to steal state secrets, just days after Canada announced it will proceed with a U.S. extradition request for a senior Chinese tech executive.

China arrested the two Canadians on Dec. 10 in what was widely seen as an attempt to pressure Canada to release Meng Wanzhou (muhng wahn-JOH’), the chief financial officer of Chinese tech giant Huawei (WAH’-way) Technologies. Meng was arrested in Vancouver on Dec. 1 at the request of U.S. authorities. Her arrest set off a diplomatic furor and has severely strained Canadian relations with China.

The U.S. is seeking the extradiction of Meng, who is also the daughter of Huawei’s founder, to face charges she misled banks about the company’s business with Iran.

China’s official Xinhua News Agency cited unidentified Chinese authorities as saying former Canadian diplomat Michael Kovrig violated Chinese laws by acting as a spy and stealing state secrets and intelligence with the help of Canadian businessman Michael Spavor. It was the first time the two men’s cases have been linked.

The Chinese Foreign Ministry has accused Canada and the U.S. of abusing their bilateral extradition treaty. They’ve reiterated Beijing’s demand that Washington withdraw its accusations against Meng.

Kovrig is a former diplomat who was working as an expert on Asia for the International Crisis Group think tank. Spavor is an entrepreneur known for contacts with high-ranking North Korean officials, including leader Kim Jong Un (gihm jung oon).

A spokesman for the International Crisis Group said Kovrig’s work for the group was “entirely transparent and in the open” and that the “vague and unsubstantiated accusations ”, are “unwarranted and unfair.”

After Meng’s arrest, a Chinese court also sentenced a Canadian to death in a sudden retrial, overturning a 15-year prison term handed down earlier. Kovrig and Spavor haven’t had access to a lawyer or to their families since being arrested.

US-CUBA

Trump prepares to tighten trade embargo on Cuba

HAVANA (AP) — The Trump administration is preparing to tighten the six-decade trade embargo on Cuba by allowing some lawsuits against foreign companies using properties confiscated by the Cuban government after its 1959 revolution.

Every president since Bill Clinton has suspended a section of the 1996 Helms-Burton act that would allow such lawsuits as it could snarl companies from U.S.-allied countries in years of complicated litigation. Potentially prompting international trade claims against the United States.

U.S. officials told The Associated Press that Trump would allow Title III of Helms-Burton to go into effect in a limited fashion that exempts many potential targets from litigation. The measure is being presented as retaliation for Cuba’s support of Venezuelan President Maduro (mah-DOO’-roh). The U.S. is trying to oust Maduro in favor of opposition leader Juan Guaido (gwy-DOH’).

Allowing a limited number of lawsuits could make investment in Cuba more burdensome for companies thinking of entering the market but it is unlikely to be a major blow against the Cuban economy.

After nearly 60 years of trade embargo, the Cuban economy is in a period of consistently low growth of about 1 percent a year, with foreign investment at roughly $2 billion, far below what it needs to spur more prosperity. But tourism, remittances and subsidized oil from Venezuela have allowed the government to maintain basic services and, a degree of stability.

LIBERIA-MISSING MILLIONS

Liberia police charge son of ex-leader in banknote scandal

MONROVIA, Liberia (AP) — Liberian police have formally charged the 61-year-old son of the country’s former president, Ellen Johnson Sirleaf, in connection with an investigation into the unlawful overprinting of local currency worth millions of U.S. dollars. A charge sheet shared with The Associated Press by police charged Charles Sirleaf and others, including former Central Bank governor Milton Weeks, with economic sabotage, misuse of public money and criminal conspiracy.

Lawyers for the accused did not comment about the charges.

Police on Monday said they are also investigating the death of the Central Bank of Liberia’s deputy director of micro-finance.