Update on the latest in business:
Asian stocks rise on Fed restraint, U.S-China trade hopes
SINGAPORE (AP) — Asian markets were mostly higher on Friday as investors cheered a more restrained Federal Reserve and U.S.-China trade talks.
U.S. stocks bounced back from a rocky start on Thursday, recording their fifth straight gain. Macy’s suffered its biggest loss of all time, putting a drag on retailers. But industrial companies rallied after U.S. negotiators said China had agreed to buy more energy and agricultural products and manufactured goods. The S&P 500 index gained 0.5 percent to 2,596.64. The Dow Jones Industrial Average added 0.5 percent to 24,001.92 and the Nasdaq composite was up 0.4 percent at 6,986.07. The Russell 2000 index of smaller-company stocks climbed 0.5 percent to 1,445.43.
In a speech on Thursday, Federal Reserve Chairman Jerome Powell stressed that the central bank has the “ability to be patient” with its plans to gradually raise interest rates.
Talks between American and Chinese negotiators may have ended without significant breakthroughs, but traders are choosing to focus on the positives. The fact that talks lasted a day longer than planned, the release of conciliatory statements from both sides and the possibility of higher-level talks in the near future are fueling gains in Asia.
Oil prices eased after rallying for the ninth consecutive day. Benchmark U.S. crude oil fell below $52.50 per barrel.
The dollar eased against the yen and the euro.
Ex-Nissan chair Ghosn indicted for alleged breach of trust
TOKYO (AP) — Nissan’s ex-chairman Carlos Ghosn was charged Friday with breach of trust in the latest blow for the star executive, according to the Tokyo District Court.
Ghosn was detained on Nov. 19. Earlier, he was charged with falsifying financial reports in underreporting his income by about 5 billion yen ($44 million) over five years through 2015.
Ghosn; Greg Kelly, another Nissan executive; and Nissan as a legal entity were charged Friday with additional underreporting of income, from 2015 through fiscal 2017.
Ghosn’s lawyer said he would request Ghosn be granted release on bail. His detention period was due to expire Friday.
Kelly and Nissan were not charged with breach of trust. Those allegations center on Ghosn’s handling of investment losses and payments made to a Saudi businessman.
Ghosn says he’s innocent.
NEW ZEALAND-IKEA OPENING
Ikea announces plans to open first New Zealand store
WELLINGTON, New Zealand (AP) — Swedish home furnishings giant Ikea announced plans on Friday to open its first New Zealand store.
The company said it would build the store near the largest city of Auckland over the next few years, and would open a pop-up store to give customers a taste of what was to come before the flagship store opened.
The announcement was welcomed by many New Zealanders concerned with high prices and limited selections for home furnishings, due in part to the costs of shipping to the island nation of 5 million people. Others worried that Ikea could spell doom for some local retailers and manufacturers.
Ikea said planning is still underway for the location, size and opening date of the store, which would include a restaurant featuring its famous Swedish meatballs. The company said it would employ several hundred New Zealanders and offer 7,000 products in the store and online.
GADGET SHOW-GROWING UP DIGITAL
CES 2019: “Family tech” gadgets appeal to parental anxiety
LAS VEGAS (AP) — The CES gadget show is full of new devices promising to make life a little bit easier for harried parents.
There are artificially intelligent toys to keep kids occupied, educate them and get them to brush their teeth without parental nagging. A common thread among the gadgets showcased in Las Vegas this week is an appeal to parental anxiety.
Sure, the kids might love them too: who wouldn’t want a computerized Harry Potter wand that also teaches coding? The Las Vegas show’s growing “family tech” sector encompasses products that range from artificially intelligent toys and baby monitors to internet-connected breast pumps.
Some also come with subtle trade-offs. Take the cute, furry Woobo, meant to be a real-life version of a child’s imaginary friend that can help set tooth-brushing routines, answer complex questions and play educational games. It’s part of a new cottage industry of sociable toys, which includes robots like Cozmo and Sony’s dog-like Aibo.
US apparel firm cuts off Chinese factory in internment camp
A U.S. supplier of T-shirts and other team apparel to college bookstores has cut ties with a Chinese company that drew workers from an internment camp holding targeted members of ethnic minority groups.
In recent years, authorities in the far west Chinese region of Xinjiang have detained an estimated 1 million Uighurs and Kazakhs in heavily-secured facilities where detainees say they are ordered to renounce their language and religion while pledging loyalty to the China’s ruling Communist Party.
Last month, an Associated Press investigation found the Chinese government had also started forcing some detainees to work in manufacturing and food industries. The investigation tracked recent shipments from one such factory, the privately-owned Hetian Taida Apparel, located inside an internment camp, to Badger Sportswear, a leading supplier in Statesville, North Carolina.
In a statement posted to its website, Badger said Wednesday it will no longer do business with Hetian Taida, nor import any goods from the same region “given the controversy around doing business” there.
The company also said it would “not ship any product sourced from Hetian Taida currently in our possession.”
Repeated calls to Hetian Taida’s chairman, Wu Hongbo, rang unanswered Wednesday. In a previous conversation with the AP, Wu said while Hetian Taida was located in the same compound as one camp that the government calls a “vocational skills education and training center,” Hetian Taida was not involved in the camp’s activities.
However, Wu said his company employed 20 to 30 “trainees” from the center as part of the region’s efforts to alleviate poverty.
Strong economy does little to lift department store sales
NEW YORK (AP) — It was supposed to be a great holiday shopping season. Many investors had expected department stores to enjoy robust sales in light of a U.S. economy buoyed by low unemployment, higher wages, strong consumer confidence and cheap gas.
So when Macy’s and Kohl’s reported lackluster numbers on Thursday, they were taken aback, sending retail stocks into a tailspin and calling into question whether such mall-based chains can compete in a changing landscape where shoppers are shifting more of their spending online.
Macy’s saw only a slight increase of 1.1 percent in sales during November-December at stores opened at least year. And while sales were strong during Black Friday and Cyber Monday, the company said sales fell off noticeably until the week of Christmas.
Meanwhile, Kohl’s reported a small sales growth that showed a dramatic slowdown from a year ago. Comparable sales rose 1.2 percent, versus 6.9 percent in the previous year.
Shares of Macy’s plummeted nearly 18 percent Thursday, suffering its worst one-day decline. Kohl’s stock closed down nearly 5 percent. Even Target’s stock took a hit, falling nearly 3 percent despite showing strong holiday sales.
Earlier this week, J.C. Penney, one of the stragglers in the department store sector, reported a drop in comparable store sales of 3.5 percent for November and December.
Frontier Airlines pilots overwhelmingly approve contract
DENVER (AP) — Frontier Airlines pilots approved a new contract in voting that ended Thursday following nearly three years of negotiations.
Of the pilots for the Denver-based budget carrier eligible to vote, 77 percent backed the deal, the Air Line Pilots Association International said. The pilots union said the contract, which will take effect next Wednesday, will provide an average 53 percent pay increase.
Frontier pilots have been working under a contract changed in 2011 to keep the airline out of bankruptcy. Negotiations began in March 2016 and soon turned into mediation overseen by federal officials.
Pilots voted to authorize a strike in 2017. However, federal law makes it difficult for airline workers to strike so pilots staged demonstrations, including staging informational pickets and sending a “strike bus” to cities in Frontier’s network.
Pilots agreed to lose pay under the 2011 contract change in order to keep prized, flexible work rules that allow them to work fewer hours when they want and to swap scheduled flights. That flexibility makes it hard to say what an average pilot makes but starting pilots, who are paid for a standard 75 flying hours a month, will jump from earning $35,000 a year to $70,000 under the new contract, union spokesman Capt. Alan Christie said.
“We’re looking forward to a much more symbiotic relationship to help Frontier reach its growth strategy,” Christie said.
ECONOMY-THE DAY AHEAD
Major business and economic reports due out today
WASHINGTON (AP) — The Labor Department releases its December Consumer Price Index today.
Trump cancels trip to Switzerland over government shutdown
WASHINGTON (AP) — President Donald Trump said Thursday that he’s canceling his trip later this month to a global forum in Switzerland because of the partial government shutdown, now in its 20th day.
The president was scheduled to leave Jan. 21 to attend the World Economic Forum in Davos, an annual event that attracts high-profile business and political figures, plus thinkers, artists and other elites. He blamed the cancellation on Democrats in Congress, saying they are unwilling to negotiate a resolution to the shutdown, which is hung up on Trump’ demand for money to build a wall on the southern border.
But Trump has kept plans to travel to New Orleans on Monday to address the American Farm Bureau.
FIAT CHRYSLER-AIR BAG RECALL
Fiat Chrysler recalls 1.6M vehicles to fix Takata air bags
DETROIT (AP) — Fiat Chrysler is recalling more than 1.6 million vehicles worldwide to replace Takata front passenger air bag inflators that can be dangerous.
Takata inflators can explode with too much force, hurling shrapnel into drivers and passengers. At least 23 people have died from the problem worldwide.
The recall covers the 2010 through 2016 Jeep Wrangler SUV, the 2010 Ram 3500 pickup and 4500/5500 Chassis Cab trucks, the 2010 and 2011 Dodge Dakota pickup, the 2010 through 2014 Dodge Challenger muscle car, the 2011 through 2015 Dodge Charger sedan, and the 2010 through 2015 Chrysler 300 sedan.
It’s part of the largest series of automotive recalls in U.S. history. About 10 million inflators are being recalled this year. Already Ford, Honda and Toyota have issued recalls in the latest round.
AT&T to end all location-data sales to data brokers
UNDATED (AP) — AT&T says it will stop selling all location data from mobile phones to brokers following a report that companies are still selling that information to shadowy companies without customer knowledge.
Last year, AT&T and other carriers pledged to stop providing location information to data brokers. But AT&T made an exception for useful services that, for instance, help customers with roadside assistance or fraud protection. Now the company says it will also end those sales in March.
The move follows a Tuesday report on Vice’s Motherboard site that showed how bounty hunters can track phone locations using carrier data.
Oregon Sen. Ron Wyden has been pushing mobile providers to end location-data sales. He said Thursday that Congress needs to pass legislation to ensure they come to a halt.
Renault: Ethics experts say pay to top execs is fraud-free
PARIS (AP) — Renault ethics officials have concluded that financial compensation to members of the French automaker’s executive committee in 2017 and 2018 was fraud-free.
The review was initiated after Renault chief Carlos Ghosn was fired as head of Japan’s Nissan and jailed in Tokyo on fraud charges in mid-November.
Ghosn remains CEO of Renault and says he’s innocent in the Japanese case. Prosecutors allege he underreported his income over five years through 2015.
The company issued a statement on the findings after a board of directors’ meeting on Thursday meeting.
Without mentioning Ghosn, the statement said internal experts assisted by independent outside experts found that executive committee compensation complied with laws and been “free from any fraud.”
Compensation during previous is expected to come under review.
AU PAIR PAY
Judge to review payment formula in $65.5M au pair settlement
DENVER (AP) — A proposed $65.5 million settlement for low-paid child care workers from around the world will be divided up under a formula once a judge considers whether the agreement is fair, a decision that could take several months.
The deal filed this week in Denver federal court covers nearly 100,000 people, mainly women, who came to the United States to work as au pairs between Jan. 1, 2009, and Oct. 28, 2018.
Lawyers who have been representing them in the class-action case for free over the past four years expect to ask a judge for 35 percent of the settlement for payment and legal fees. That leaves about $40 million to be divided among the au pairs.
The lawsuit alleged 15 companies authorized to bring au pairs to the U.S. colluded to keep their wages low.
Metro New York port to be 1st to use electric container carrier
NEWARK, N.J. (AP) — The Port Authority of New York and New Jersey will conduct the first test at a U.S. port of an electric vehicle to move cargo containers, with an eye toward eventually replacing the current gas-powered fleet.
The pilot program is part of a broader effort by the Port Authority to reduce greenhouse gases at the ports, which handle billions of dollars in cargo annually.
The vehicles, known as straddle carriers, are used to lift 30-ton cargo containers and load them onto trucks for transport. There are more than 300 in use at the ports of New York and New Jersey.
The electric straddle carriers will be tested this year at Maher Terminals. They will be assessed for lifting capacity, down time for maintenance and environmental benefits.
If the pilot program is successful, 15 to 30 of the older gas-powered vehicles could be replaced annually by the electric vehicles.
The carriers are made by Kalmar, a Finnish company.