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Update on the latest business

March 29, 2019

FINANCIAL MARKETS

Stocks gain

NEW YORK (AP) — Stocks are holding on to broad gains at midday on Wall Street, led by industrial companies and chipmakers.

The S&P 500 index is on track for its best quarterly performance since the third quarter of 2009. The S&P technology sector has led the gains with a jump of more than 18 percent.

Boeing rose 1.9 percent, boosting the industrials sector. Micron Technology rose 4.6 percent as makers of semiconductors saw solid gains.

Lyft made its much-anticipated trading debut on the Nasdaq stock exchange, jumping 21 percent to $87.24. Shares of the ride-hailing company were priced at $72.

Bond yields rose for the second straight day, allaying traders’ concerns following a steep drop in long-term yields over the past week. The yield on the benchmark 10-year Treasury note rose to 2.42 percent from 2.39 percent late Thursday.

CONSUMER SPENDING

US consumer spending edges up weak 0.1 percent in January

WASHINGTON (AP) — U.S. consumer spending edged up a tiny 0.1 percent in January, while incomes advanced a modest 0.2 percent in February, further evidence that economic activity may have decelerated after strong growth for most of last year.

The Commerce Department says the weak gain in consumer spending in January followed a 0.6 percent plunge in December that represented the biggest one-month drop in more than nine years. The 0.2 percent rise in incomes in February came after a 0.1 percent drop in incomes in January.

Many analysts believe the economy has entered a soft patch and that growth is significantly slower in the current quarter. The U.S. faces various headwinds, including weakness overseas and the waning effects of the 2017 tax cuts.

NEW HOME SALES

US new-home sales increased 4.9 percent in February

WASHINGTON (AP) — Sales of new U.S. homes climbed 4.9 percent in February, an indication that falling mortgage rates have given a boost to demand from buyers.

The Commerce Department says that new homes sold at a seasonally adjusted annual rate of 667,000 in February, an increase from an upwardly revised 636,000 in January. New-home sales are running 2.8 percent higher through the first two months of 2019 than during the same period last year.

A sharp drop in mortgage rates has eased affordability pressures and aided homebuying. The average 30-year mortgage rate climbed for much of 2018 to roughly 5 percent in November, only to dip to nearly 4 percent this week, according mortgage buyer Freddie Mac.

The median sales price of a new home in February fell 3.6 percent to $315,300.

ETHIOPIA-PLANE CRASH

Report: Anti-stall system was on before Ethiopian jet crash

UNDATED (AP) — Investigators have determined that an anti-stall system automatically activated before an Ethiopian Airlines Boeing 737 Max jet plunged into the ground, a newspaper reported Friday.

The Wall Street Journal reported that the preliminary conclusion was based on information from the aircraft’s data and voice recorders. The data showed that the malfunctioning automated system may be responsible for the deadly March 10 crash. It also is a strong link to the fatal crash of an Indonesian Lion Air Max jet, which had similar problems in October.

Both crashes killed a total of 346 people.

The newspaper cited unidentified people that it said were briefed on the investigation. The U.S. Federal Aviation Administration and Ethiopian authorities wouldn’t comment Friday.

CHINA-US-TRADE TALKS

China, US trade talks adjourn until next week

BEIJING (AP) — Chinese and U.S. negotiators have wrapped up trade talks in Beijing with U.S. Treasury Secretary Steven Mnuchin saying they were “constructive.”

Mnuchin said in a tweet Friday that he looked forward to continuing the talks in Washington next week.

The representatives posed for photos at a government guest house in western Beijing but did not comment about the state of negotiations in front of reporters.

Neither side provided any details on the status of the talks or said if major progress had been made.

Chinese Vice Premier Liu He is due to visit Washington next week to lead Beijing’s delegation to the talks on resolving a dispute over technology and industrial policy. It has resulted in both sides imposing heavy punitive tariffs on each other’s exports.

BREXIT

UK lawmakers reject government’s Brexit deal again

LONDON (AP) — U.K. lawmakers on Friday rejected the government’s divorce agreement with the European Union for a third time, leaving Britain just two weeks to decide between a long delay to Brexit and an abrupt no-deal departure from the bloc.

The House of Commons voted 286-344 against the withdrawal agreement struck between Prime Minister Theresa May and the EU, rebuffing her plea to “put aside self and party” and “accept the responsibility given to us by the British people” to deliver Brexit.

Amid business warnings that a no-deal Brexit could mean crippling tariffs, border gridlock and shortages of goods, a visibly frustrated May said the vote had “grave” implications.

The EU said the rejection of the divorce terms made a no-deal Brexit “a likely scenario” and called an emergency summit for April 10 to decide what to do next.

EUROPE-FACEBOOK

Facebook beefs up political ad rules ahead of EU election

LONDON (AP) — Facebook says it’s beefing up its requirements for political advertising ahead of European Union elections.

The social media giant said Friday it is tightening rules even further to prevent foreign interference and increase transparency ahead of voting in May.

The company said it will require political advertisers to confirm they are located in an EU country. That’s on top of a previously announced requirement that ad buyers must confirm their identities.

Facebook is also making improvements to its ad database, including widening access so that outside groups can analyze political or issue ads.

Silicon Valley tech companies have come under pressure from European Union authorities to do more to prevent their platforms from being used by groups, including from Russia, to meddle in elections.

TRUMP-HEALTH CARE

Trump administration opposes health plan ruling

WASHINGTON (AP) — President Donald Trump’s administration says it disagrees with a federal judge’s ruling that a new type of health insurance plan for small businesses stretches federal law and must be set aside.

Signaling a possible appeal, Justice Department spokeswoman Kelly Laco says in a statement issued Friday the administration is “considering all available options.”

U.S. District Judge John D. Bates ruled in Washington late Thursday that a Trump administration regulation creating the new small-business plans was “clearly an end-run” around the Obama-era Affordable Care Act, often called “Obamacare.” Bates says it also runs counter to longstanding federal laws that govern workplace benefits.

Trump has been touting the plans as a tremendous value for small businesses and sole proprietors, but the plans do not seem to have had a major impact.

ROMAINE OUTBREAKS-WATER SAFETY

Email show FDA worry with growers after romaine outbreaks

NEW YORK (AP) — Emails show a U.S. Food and Drug Administration official’s concerns about the produce industry’s practices after repeated food poisoning outbreaks tied to romaine lettuce.

In emails to colleagues, a senior FDA official said the industry needed to change how it tests water used to grow leafy greens.

Though the FDA has publicly called on the produce industry to step up safety, the emails obtained by The Associated Press through a public records request offer a stark view of the agency’s longstanding frustrations with continued outbreaks.

The U.S. saw two outbreaks last year including one before Thanksgiving that prompted the agency to warn consumers to avoid romaine.

The FDA says it has been working with growers and state agencies to improve safety since then.

SPORTS BETTING-RHODE ISLAND

Sports betting revenue projection was $11.5M. So far? $150K

PROVIDENCE, R.I. (AP) — The Rhode Island lottery says the state’s casinos lost nearly $900,000 on sports betting in February after winning bets for the Super Bowl and other professional sports were paid out.

That leaves Rhode Island with about $150,000 in revenue from sports betting since the late November launch. The state had projected it would get $11.5 million from the new market this fiscal year.

The lottery released figures Friday for bets placed at Twin River Casino in Lincoln and Tiverton. Gamblers placed about $20.7 million in wagers. The casinos paid nearly $21.6 million on winning bets.

Many football fans went to the casinos in January and February to bet on the victorious New England Patriots in the Super Bowl.

The state gets 51 percent of sports betting revenue, after subtracting expenses.