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Update on the latest business

September 7, 2018

FINANCIAL MARKETS

Stocks mostly lower

NEW YORK (AP) — U.S. stock indexes are mostly lower in midday trading on Wall Street, after a surprisingly strong jobs report pushed investors to gird for higher interest rates.

Investors sold high-dividend stocks as bond yields rose, while tech stocks rebounded from recent losses.

The yield on the 10-year Treasury note jumped to 2.94 percent from 2.87 percent late Thursday.

Tesla slumped more than 5 percent after its chief accounting officer quit after only a month, and CEO Elon Musk was seen appearing to smoke marijuana during an interview.

ECONOMY-JOBS REPORT

US adds a strong 201K jobs; unemployment stays at 3.9 pct.

WASHINGTON (AP) — Hiring picked up in August as U.S. employers added a strong 201,000 jobs, a sign of confidence that consumers and businesses will keep spending despite the Trump administration’s conflicts with U.S. trading partners.

The Labor Department says the unemployment rate remained 3.9 percent, near an 18-year low.

Americans’ paychecks grew at a faster pace. Average hourly wages rose in August and are now 2.9 percent higher than they were a year earlier, the fastest annual gain in eight years. Still, after adjusting for inflation, pay has been flat for the past year.

The economy is expanding steadily, fueled by tax cuts, confident consumers, greater business investment in equipment and more government spending. Growth reached 4.2 percent at an annual rate in the April-June quarter, the fastest pace in four years.

TESLA-STOCK

Tesla stock falls as CEO appears to smoke marijuana on video

DETROIT (AP) — Shares of electric car maker Tesla Inc. tumbled Friday after the CEO appeared to smoke marijuana during an interview and the company’s accounting chief left after a month on the job.

During a podcast that was shown on YouTube, CEO Elon Musk inhales from what the host says is a combined marijuana-tobacco joint. Musk appeared on “The Joe Rogan Experience” overnight. The joint was provided to Musk by Rogan, who said it was legal.

On Friday the company announced that Chief Accounting Officer Dave Morton resigned after a month on the job, citing public attention and the fast pace of the post. The company announced the departure in a regulatory filing. It said Morton had no disagreements with Tesla’s leadership or financial reporting.

VERIZON-ARMSTRONG DEPARTURE

Report: Head of Verizon’s AOL, Yahoo in talks to depart

NEW YORK (AP) — The Wall Street Journal is reporting that Verizon’s media and advertising chief, Tim Armstrong, is in talks to leave.

Armstrong came to Verizon as part of its purchase of AOL in 2015 and began overseeing Yahoo as well after Verizon bought it in 2017. He was tasked with growing Verizon’s ad business in a challenge to Facebook and Google, but that business has been struggling and remains one of Verizon’s less profitable divisions.

Armstrong was one of Google’s early employees and was key to developing its digital ad business before moving to AOL in 2009.

The Journal report cites unnamed people familiar with the talks. Verizon spokesman Bob Varettoni says Verizon doesn’t comment on rumors and speculation.

Telecoms have been buying content makers to diversify as the wireless industry slows.

GOOGLE AT 20

As Google turns 20, questions over whether it’s too powerful

SAN FRANCISCO (AP) — It was 20 years ago that Larry Page and Sergey Brin set out to organize all of the internet’s information. Since then, the search engine they named Google has morphed into a dominating force in smartphones, online video, email, maps and much more.

That resounding success now has regulators and lawmakers around the world questioning whether the company has become too powerful as its services vacuum up sensitive information about billions of users.

Google may now be facing the some of the same regulatory challenges that knocked Microsoft from its perch in the late 1990s.

The company started 20 years ago Friday with an initial investment of $100,000. Google and its sibling companies operating under the umbrella of Alphabet Inc. are now worth $800 billion.

HEALTH OVERHAUL-2019 PREMIUMS

Analysts say insurers figuring out ‘Obamacare’

WASHINGTON (AP) — Business analysts say the leveling off in premiums next year under the Affordable Care Act means insurers have figured out how to make a profit on the politically contentious program.

Deep Banerjee (BAN’-ur-jee) of Standard & Poor’s says insurers who stuck with the ACA have gotten to know the health needs of their mostly low-income customers and learned to price their plans accordingly.

An exclusive analysis by the consulting firm Avalere Health and The Associated Press finds “Obamacare” appears to be stabilizing after two years of sharp premium increases.

The analysis found a 3.6 percent average increase in proposed or approved premiums across 47 states and Washington, D.C., for next year, while 11 states will see a drop.

But Banerjee still sees a “cloud of uncertainty” over the ACA because of the Trump administration’s hostility.

CELEBRITY CHEF-SEX HARASSMENT

Celebrity chef accused of harassment files for bankruptcy

(Information in the following story is from: The Washington Post, http://www.washingtonpost.com )

WASHINGTON (AP) — Celebrity chef Mike Isabella once had more than a dozen restaurants in the Washington area. Now he’s filed for bankruptcy after a sexual harassment lawsuit.

The Washington Post reports the “Top Chef” alum filed for bankruptcy protection for his businesses on Thursday.

The March lawsuit by a former Mike Isabella Concepts top manager, Chloe Caras, accused Isabella and his partners of touching her without permission and talking about her buttocks. They denied it, the suit was settled in May, but the damage was done. Sales plummeted, the Washington Nationals cut ties and staffers quit.

Isabella says he hopes the bankruptcy filing will help avoid more restaurant closures. He spoke ahead of a Friday hearing involving his restaurant at the University of Maryland in College Park, where he’s fighting eviction.

CHICAGO HOTELS-STRIKE

Chicago hotel workers strike in pursuit of better benefits

CHICAGO (AP) — Workers are picketing outside several downtown Chicago hotels as housekeepers, servers, cooks and others participate in a strike as part of an effort to get better benefits.

The Friday walkout is planned for 25 hotels and comes after members of the hotel workers’ union, Unite Here Local 1, voted to authorize a strike amid contract negotiations. Their current contract expired Aug. 31.

The union says better health care coverage is among the demands. Workers say they deserve higher wages, more manageable workloads and sick days to see doctors.

The strike includes workers at the Hyatt Regency Chicago. A statement on behalf of the hotel says Hyatt “has a long history of strong relations” with unions and will continue negotiating in good faith. The hotel says it has plans in place to continue operations.

RICHARD DEVOS-SERVICES

Services set for Amway founder and Magic owner Richard DeVos

GRAND RAPIDS, Mich. (AP) — A private funeral service has been scheduled for billionaire Richard DeVos , the co-founder of direct-selling giant Amway, owner of the NBA’s Orlando Magic and father-in-law of Education Secretary Betsy DeVos.

Details of next Thursday’s invitation-only services at LaGrave Avenue Christian Reformed Church in Grand Rapids were announced Friday, a day after his death. Others will be able to watch a simulcast at the city’s DeVos Place convention center.

Family spokesman Nick Wasmiller has said DeVos died at his western Michigan home due to complications from an infection. He was 92.

DeVos was born in Grand Rapids. He served as Amway’s president until 1993 and bought the Magic in 1991.

DeVos and his late wife, Helen, also donated to Christian churches and ministries and various other causes through their Richard and Helen DeVos Foundation.

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