Update on the latest in business:
TOKYO (AP) — Shares were mostly higher in Asia on Tuesday ahead of Federal Reserve chair Janet Yellen’s testimony to Congress. Japan’s Nikkei 225 index gained 0.6 percent to 20,195.48 on expectations the yen will weaken further against the dollar as the central bank strives to keep long-term bond yields low.
On Wall Street, gains in technology and materials companies were mostly outweighed by losses elsewhere on Wall Street, leaving major indexes mixed at the closing bell. Facebook rose 1.4 percent while Microsoft gained 0.7 percent. Banks, health care and real estate companies fell. The Standard & Poor’s 500 index rose 2 points, while the Dow Jones industrial average slipped 5 points and the Nasdaq composite increased 23 points.
THE DAY AHEAD
Major business and economic events scheduled for Tuesday
WASHINGTON (AP) — The Labor Department will release job openings and labor turnover survey for May.
PepsiCo Inc. will report quarterly financial results before the market opens.
Trump taps Randal Quarles for Federal Reserve Board
WASHINGTON (AP) — Randal Quarles, who served in top Treasury Department positions under two Republican presidents, has been nominated by President Donald Trump to take a key position on the Federal Reserve board in charge of overseeing the banking system.
The selection, announced by the White House late Monday, marked Trump’s first effort to reshape the nation’s central bank. He criticized the institution during the campaign both for its low-interest rate policies, which he said were helping Democrats, and its action to implement the sweeping Dodd-Frank Act passed in response to the 2008 financial crisis.
The 59-year-old Quarles was picked to serve as the Fed’s vice chairman for bank supervision. The position gives him a key role in the administration’s efforts to loosen the banking regulations imposed by the Dodd-Frank legislation Congress passed in 2010. The Dodd-Frank measure was aimed at cracking down on the risky bank practices that contributed to the 2008 financial crisis.
Quarles had been considered a front-runner for the job for months. The brief announcement gave no indication of when the administration might fill the other two vacancies on the seven-member Fed board, all of which will require Senate confirmation.
Japan hosts TPP Pacific Rim trade pact talks, minus the US
TOKYO (AP) — Japan will be holding talks on a Pacific Rim trade initiative rejected by U.S. President Donald Trump beginning Wednesday in the mountain resort town of Hakone, west of Tokyo.
The three-day meeting with other envoys to the Trans-Pacific Partnership follows a breakthrough on an agreement with the European Union last week that was seen as a repudiation of the U.S. moves to pull back from such trade deals.
Last week, Japan named a new chief negotiator for talks among the remaining 11 members seeking to salvage the TPP after Trump pulled out of the pact soon after taking office.
The TPP members hope to make progress before an Asia-Pacific summit in Vietnam in November.
Other countries participating are Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
Union files for vote by workers at Mississippi Nissan plant
JACKSON, Miss. (AP) — The United Auto Workers have filed petitions to force a unionization election at a Nissan plant in Mississippi after a yearslong campaign to build support in the South, a region typically unwelcoming to organized labor.
The UAW declined comment but has scheduled an event Tuesday at its office near the plant in Canton, just north of Jackson. Sandra Hightower of the National Labor Relations Board confirmed that the board received the UAW’s election petition in its New Orleans office.
The union has long struggled to organize foreign-owned auto plants across the South, working for years to build support for a vote among the 6,500 employees at the Mississippi complex. Monday’s move sets the stage for a key showdown.
Nissan Motor Co. spokeswoman Parul Bajaj reiterated the company’s stance that workers get to choose whether they have a union but management opposes the move.
Amazon says 900 jobs will be added at new Boston office
BOSTON (AP) — Amazon says it will add 900 jobs at a Boston office that’s set to open next spring.
The online retail company said Monday it has signed a lease for a 150,000-square-foot (14,000-sqare-meter) space in a building along Fort Point Channel. It plans to hire people to work on its Alexa voice-activated technology, logistics and other business lines.
Amazon has space in the Boston’s Back Bay neighborhood and in Cambridge’s Kendall Square neighborhood.
The new Boston office will be near General Electric’s new world headquarters, which is under construction. General Electric announced in March it bought about 2.5 acres (1 hectare) in South Boston from Procter & Gamble.
Despite promise, no decision yet from Trump on steel tariffs
WASHINGTON (AP) —President Donald Trump pledged during the campaign to help U.S. factory workers by slapping tariffs on foreign steel. But his long-awaited decision on the issue is running behind schedule and administration officials are leaving plenty of wiggle room on what direction he’ll take.
Commerce Secretary Wilbur Ross initially hoped to finish a report on tariffs last month, but his department has been holding off as the Pentagon weighs in about impact of steel tariffs on national security. The delay is an example of the difficulty Trump faces in delivering on his ambitious policy agenda — on taxes, health insurance and more — as quickly as he told voters he could.
White House officials have hinted that tariffs still are coming. Asked on “Fox News Sunday” over the weekend if the president planned to impose sanctions on foreign steel, White House chief of staff Reince Priebus responded: “My guess is that he will because he promised he would.”
Mt Gox CEO goes on trial in Japan as bitcoin gains traction
TOKYO (AP) — A Tokyo court has begun hearings into charges that the head of the failed Japan-based bitcoin exchange Mt. Gox accessed its computer system and inflated his account by $1 million.
French-born Mark Karpeles was whisked into the Tokyo District Court early Tuesday after arriving in a white car.
Karpeles was arrested in August 2015 and released on bail last year. He has denied wrongdoing. If found guilty, he could face up to five years in prison, or a fine of up to 500,000 yen ($4,000).
When Mt. Gox went offline in 2014, Karpeles said tens of thousands of bitcoins worth several hundred million dollars were unaccounted for.
People affected by Mt. Gox’s failure are still trying to obtain funds they lost and are hoping the trial will explain what happened.
ELECTRIC CAR FACTORY
Electric car maker scraps plans for $1 billion Nevada plant
CARSON CITY, Nev. (AP) — An electric car maker said Monday it is deserting its plan to construct a $1 billion manufacturing plant in southern Nevada eight months after suspending the project and sinking at least $120 million into it.
Faraday Future halted work on the project outside Las Vegas last November, calling the stoppage then a “temporary adjustment” that wouldn’t affect plans to begin production in 2018.
Faraday Future Chief Financial Officer Stefan Krause said Monday’s decision to scrap the plant was due to a shift in business strategy. The Gardena, California-based company said in a statement that it will now look for an existing facility to produce its electric vehicles in California or Nevada.
The announcement came days after reports that a Shanghai court froze more than $180 million in assets belonging to one of the company’s biggest backers, tech billionaire Jia Yueting. The company said that Jia’s financial problems were not related to the decision.
US consumer credit up $18.4 billion in May, most in 6 months
WASHINGTON (AP) — American consumers increased their borrowing in May at the fastest pace in six months, reflecting a sharp rebound in the category that includes credit cards.
The Federal Reserve reported Monday that total consumer borrowing rose by $18.4 billion in May, the strongest gain since a $25.1 billion increase in November. In addition, April’s gain of $8.2 billion, the weakest increase in nearly six years, was revised up to a more respectable increase of $12.9 billion.
Consumer borrowing is closely watched for signals it can provide about consumer spending patterns.
With the labor market continuing to churn out jobs and the stock market at record levels, economists believe that households will feel more confident about boosting their debt levels to support increased spending. Consumer spending accounts for 70 percent of economic activity.
Seattle approves new income tax for wealthy residents
SEATTLE (AP) — Seattle’s wealthiest would become the only Washington state residents to pay an income tax under legislation approved by the City Council, a measure designed as much to raise revenue as to open a broader discussion about whether the wealthy pay their fair share.
The council voted unanimously Monday to impose a 2.25 percent tax on the city’s highest earners. Personal income in excess of $250,000 for individuals and in excess of $500,000 for married couples filing joint returns would be taxed.
The measure is certain to face a court challenge from opponents who call the tax proposal illegal, unconstitutional and a waste of taxpayer money. City leaders said they are likely to keep expanding and increasing the tax over time. The council is “going to unanimously adopt an illegal income tax that has no hope of taking effect and will waste taxpayer resources on litigation the city is sure to lose,” said Jason Mercier, who directs the center for government reform with the Washington Policy Center,
TAKATA-AIR BAG DEATH
Man dies when air bag inflator ruptures during car repair
DETROIT (AP) — Another person has been killed in the U.S. by an exploding Takata air bag inflator, but this death wasn’t the result of a crash.
Eighty-one-year-old Ramon V. Kuffo, of Hialeah, Florida, was working inside a 2001 Honda Accord using a hammer when the air bag inflator ruptured, on June 18, 2016. A medical examiner ruled his death accidental due to head trauma, according to a Hialeah police report.
It’s the 12th U.S. death attributed to the faulty inflators and 17th worldwide, including five in Malaysia. Takata inflators can explode with too much force when exposed to prolonged airborne moisture and hot-and-cold temperature cycles. If that happens, the inflators can blow apart a metal canister and shoot out shrapnel which can kill or injure people. More than 180 people have been hurt in the U.S. alone.
Federal regulator moves to mostly ban arbitration clauses
NEW YORK (AP) — Consumers could band together to sue their banks or credit card companies under a federal rule issued Monday that’s likely to face resistance from Congressional Republicans and the White House.
The Consumer Financial Protection Bureau decided to ban most types of mandatory arbitration clauses, which require credit card or bank customers to use a mediator when they have a dispute — often giving up their right to sue in court.
Mandatory arbitration clauses are found in the fine print of tens of millions of financial products, from credit cards to checking accounts. Because consumers generally don’t carefully read the fine print on the agreements for their checking accounts and credit cards, they are often unaware they are subject to arbitration.
Those clauses are not symbolic. They are used heavily by banks. Even Wells Fargo banned customers from filing class-action lawsuits against it during the height of its sales practices problems, until pressure from politicians and outside groups led the bank to waive that right earlier this year.
Chinese conglomerate Wanda sells theme park business
BEIJING (AP) — Chinese conglomerate Wanda Group, owner of Hollywood’s Legendary Studios, is selling most of its theme parks, retreating from a business it once said would challenge Walt Disney Co.
Wanda says it will sell 13 parks and 76 hotels to a Chinese buyer, Sunac China Holdings Ltd., for 63.2 billion yuan ($9.3 billion) but will continue to manage the properties.
The surprise sale gives Wanda possible revenue to pay down debt that has soared during an aggressive expansion into entertainment, tourism and other consumer businesses.
Wanda founder Wang Jianlin, one of China’s richest businesspeople, said last year he wanted to challenge Disney as a global theme park brand.
Dominion Energy to build 2 wind turbines off Virginia coast
RICHMOND, Va. (AP) — Dominion Energy has announced that it’s partnering with a Danish energy company to build two wind turbines off the Virginia coast. The effort has been years in the making, and the utility says it could lead to the development of a much larger wind farm.
Dominion said that DONG Energy will immediately begin design and engineering work on the Coastal Virginia Offshore Wind project, with the two six-megawatt turbines expected to be installed off Virginia Beach by the end of 2020.
Speaking at a news conference Dominion President and CEO Thomas Farrell II said the turbines’ 12 megawatts of generation is enough to power about 3,000 homes at full capacity. If the project is considered a success, Dominion would move forward with developing an adjacent 112,800-acre site it leased in 2013 from the Bureau of Ocean Energy Management.
The company said that site could eventually generate up to 2,000 megawatts of energy - enough to power half a million homes.
WELLS FARGO SETTLEMENT
Judge gives preliminary approve to Wells Fargo settlement
NEW YORK (AP) — Wells Fargo has received preliminary approval to pay out $142 million to customers affected by the bank’s sales practices scandal.
A federal judge gave preliminary approval Saturday to the deal that would settle claims over fraudulent accounts going back to 2002.
The San Francisco-based bank and lawyers for customers reached the agreement earlier this year over accounts that Wells Fargo staff had opened without permission as they sought to meet unrealistic sales goals set by management.
In September, Wells Fargo agreed to pay a combined $185 million fine to state and federal regulators. The biggest scandal in the bank’s history led to the abrupt retirement of its CEO, John Stumpf. Several other top executives have lost their jobs.