Update on the latest business
Aug. 23, 2018
Stocks edge lower
NEW YORK (AP) — Stocks have veered lower in midday trading on Wall Street as losses in banks and energy companies offset gains elsewhere in the market.
Homebuilders declined following new data showing sales of new U.S. homes slumped in July.
Technology stocks moved higher, adding to recent gains.
Investors had their eye on trade as the U.S. and China rolled out more tariffs on each other, escalating their trade dispute even as representatives from both nations held their first high-level talks in two months.
US new-home sales fell 1.7 percent in July
WASHINGTON (AP) — Sales of new U.S. homes slumped 1.7 percent in July, the second straight monthly decline as the broader housing market appears to have lost some of its momentum despite an otherwise solid economy.
The Commerce Department says newly built homes sold at a seasonally adjusted annual rate of 627,000 last month, down from 638,000 in June and 654,000 in May. Despite the slowdown, new-home sales have risen 7.2 percent year-to-date.
Steady hiring gains and signs of stronger economic growth have boosted demand for housing. But higher mortgage rates and a tight inventory of homes on the market has made affordability a challenge for many would-be buyers.
The average sales price has risen 5.8 percent from a year ago to $394,300.
Average US mortgage rates fall; 30-year at 4.51 percent
WASHINGTON (AP) — Long-term U.S. mortgage rates fell this week for the third consecutive week, yet they remain significantly higher than a year ago.
Mortgage buyer Freddie Mac says the average rate on 30-year, fixed-rate mortgages ticked down to 4.51 percent from 4.53 percent last week. A year ago, the average was 3.86 percent. The interest charged on home loans have been running at their highest levels in seven years, although they remain below the long term historic average.
The average rate on 15-year, fixed-rate loans fell to 3.98 percent this week from 4.01 percent last week.
Sears to close another 46 unprofitable stores in November
HOFFMAN ESTATES, Ill. (AP) — Sears Holdings Corp. is closing another 13 Kmart stores and 33 Sears stores as sales shrink and losses grow.
The ailing company said liquidation sales at the 46 unprofitable stores marked for closure will start Aug. 30, according to the company website. They'll close in November.
The company said Thursday it informed its workers.
In January, Sears said it was closing 100 stores. It announced in May that it was closing another 100.
The move comes as Sears is considering a bid from CEO Eddie Lampert's hedge fund ESL Investments to acquire its jewel Kenmore appliances from the company for $400 million.
As of May, the retailer had about 800 stores, down from about 1,000 at the end of last year and far below the 2012 peak of 4,000 stores.
Fiat Chrysler recalls vans, SUVs to fix spongy brakes
DETROIT (AP) — Fiat Chrysler is recalling nearly 209,000 minivans and SUVs worldwide to fix a brake problem that can cause longer stopping distances.
The recall covers the 2018 Dodge Journey, 2019 Jeep Cherokee and the 2018 and 2019 Dodge Grand Caravan and Jeep Compass. Most are in the United States.
The company says a brake-system part wasn't built to specifications, allowing gas bubbles to form in the brake fluid. FCA has received no customer complaints or reports of any crashes or injuries from the problem.
Owners will be notified shortly. Dealers will replace the brake fluid, which Fiat Chrysler says will solve the problem.
Senate panel approves Trump's nominee for consumer watchdog
NEW YORK (AP) — The Senate Banking Committee has approved Kathy Kraninger to run the Consumer Financial Protection Bureau with a 13-12 party-line vote.
The approval comes despite protests from Senate Democrats who said President Donald Trump's nominee is unqualified to lead the consumer watchdog.
Kraninger is currently a mid-level executive in the White House's budget office, working directly under Mick Mulvaney, who holds dual roles as the president's budget director and as acting director of the CFPB.
Mulvaney has moved to roll back many of the CFPB's rules and regulations. Kraninger has given little guidance on how she plans to run the bureau, but she's expected to operate the bureau similarly to Mulvaney.
Her nomination will now move to the full Senate.
Official says China hoping trade talks will help
BEIJING (AP) — A Chinese foreign ministry spokesman says Beijing is hoping for a good outcome from trade talks in Washington on their escalating dispute over technology policy.
The official, Lu Kang, declined to give details of the talks that began Wednesday. He said, "We hope the U.S. side will get along with us to strive for a good result from the talks with a reasonable and practical attitude."
The United States and China pushed ahead Thursday with 25 percent penalty tariffs on billions of dollars of each other's goods.
The increases came as envoys met in Washington for their first high-level talks in two months. They gave no sign of progress toward a settlement of U.S. complaints that Beijing steals technology and its industry development plans violate Chinese free-trade commitments.
Russian ruble at lowest since 2016 on US sanctions fears
MOSCOW (AP) — The Russian ruble has fallen to its lowest level against the dollar since April 2016 amid fears of new economic sanctions by the United States.
In Thursday morning trading in Moscow, the ruble had fallen by around 2 percent to trade at nearly 69 to the dollar.
The latest drop in the value of the Russian currency came amid talk that the U.S. was readying further sanctions. On Tuesday, the U.S. slapped sanctions on two Russian shipping companies over alleged oil trading with North Korea.
It could also impose much broader sanctions as a consequence of the poisoning of ex-spy Sergei Skripal in Britain in March.
Russian President Vladimir Putin called sanctions against Russia "counterproductive and senseless" following talks Wednesday with his Finnish counterpart Sauli Niinisto.
US lawmakers urge Iran expulsion from SWIFT banking network
WASHINGTON (AP) — Republican lawmakers are calling for Iran to be expelled from the main financial system that oversees international bank transfers, as the Trump administration steadily re-imposes sanctions on the country following the U.S. withdrawal from the Iran nuclear deal.
A group of 16 GOP senators led by Ted Cruz of Texas urged Treasury Secretary Stephen Mnuchin on Thursday to take "all necessary steps" to disconnect Iran from the SWIFT network. They said the renewed U.S. sanctions won't be effective unless that step is taken.
President Donald Trump withdrew from 2015 nuclear accord in May and re-imposed some sanctions on Iran earlier this month over the objections of Iran and the other parties to the deal, including Britain, France and Germany. A second batch of sanctions will be re-imposed in November.
British Airways to end direct flights to Iran in September
DUBAI, United Arab Emirates (AP) — British Airways says it will end its direct flights to Iran's capital in September as "the operation is currently not commercially viable."
The decision announced Thursday comes after President Donald Trump withdrew from the nuclear deal between Iran and world powers and began restoring U.S. sanctions.
British Airways says its last flight to Tehran will be Sept. 22, with the return on Sept. 23.
British Airways resumed direct flights to Tehran in September 2016. Service had been suspended in October 2012 as relations deteriorated between Britain and Iran.
Britain was among the world powers that struck the 2015 atomic accord. It, along with other European nations, have said they want to protect companies that continue doing business in Iran, but many have pulled out since Trump's May decision.
Ryanair, union strike deal after 22-hour session
LONDON (AP) — Ryanair and one of Ireland's main unions have struck an agreement following a 22-hour negotiating session, paving the way for a ballot of pilots engaged in a long-running dispute with the airline.
Neither side wished to comment on the agreement struck after the marathon session that started Wednesday morning and ended Thursday morning.
The budget airline and pilots have wrangled over working conditions, base transfers and annual leave, resulting in five days of strikes by Irish pilots last month.
The Forsa union says the proposed deal will now go to a vote "with a recommendation for acceptance," while Ryanair said it would "take these proposals to its board in due course."
The airline has faced a barrage of strike actions since agreeing to recognize unions last year.
MAERSK-NORTHERN SEA ROUTE
World's biggest shipping firm to test Russian Arctic route
COPENHAGEN, Denmark (AP) — Danish shipping group A.P. Moller-Maersk says it will send a cargo vessel through the Russian Arctic for the first time as a result of melting sea ice.
Janina von Spalding, spokeswoman for the world's biggest shipping company, said Thursday the new ice class container vessel would embark on "a one-off trial designed to explore an unknown route for container shipping."
The Northern Sea Route could be a shorter route for journeys from East Asia to Europe than the Northwest Passage over Canada because it will likely be free of ice sooner due to climate change.
Von Spalding said the ship will leave Russia's Pacific port city of Vladivostok around Sep.1 and sail to St. Petersburg where it will arrive by the end of the month.
Facebook bans personality app on concerns user data misused
LONDON (AP) — Facebook says it has banned a quiz app from its platform for refusing an inspection and concerns that data on as many as 4 million users was misused.
The social media giant said Wednesday that it banned the myPersonality app after it found that user information was shared with researchers and companies "with only limited protections in place."
Facebook said it would notify the app's users that their data was misused. The announcement comes after the recent privacy scandal surrounding political data mining firm Cambridge Analytica.
The company said myPersonality was "mainly active" prior to 2012, and it wasn't clear why Facebook was taking action now.
That scandal sparked a wider investigation by Facebook, which said it has also suspended more than 400 apps over data sharing concerns.
TECH COMPANIES-ELECTION HELP
Microsoft hopes to protect candidates without skirting laws
UNDATED (AP) — Tech companies want to protect U.S. political candidates from Russian hackers ahead of the midterm elections, but could that free help count as an illegal campaign contribution?
That's the question Microsoft asked the Federal Election Commission this week.
The company is requesting the FEC's advisory opinion to make sure Microsoft's new free package of online account security protections for "election-sensitive" customers doesn't count as in-kind campaign contributions.
Microsoft says it's offering its AccountGuard service on a nonpartisan basis to candidates, party committees and certain nonprofit groups.
Obtaining the FEC's opinion could take a few months, but Microsoft says that won't stop it from moving ahead with the service.
The company tells FEC it might also work with others such as Facebook and Twitter on coordinated election security efforts.
Kroger to phase out plastic bags at all stores
CINCINNATI (AP) — The nation's largest grocery chain will phase out the use of plastic bags in its stores by 2025.
Kroger Co. orders about 6 billion bags each year.
The company, based in Cincinnati, operates 2,779 stores in 35 states and the District of Columbia, serving almost 9 million people daily through two dozen different grocery chains.
Kroger said Thursday that will start at its Seattle chain QFC, where it expects to be plastic-bag free by next year.
There is a broader shift by companies to reduce waste, especially plastic. Disney, Starbucks, Marriott and McDonald's are getting rid of plastic straws. Dunkin' Donuts is phasing out polystyrene foam cups by 2020. Ikea plans to eliminate single-use plastic products from its shelves by 2020, including straws.
DON'T CALL IT VEGAN
There's no meat, eggs or dairy — but don't call them "vegan"
NEW YORK (AP) — It's not vegan, it's "plant-based." So will carnivores bite?
As companies try to cater to Americans' interest in lighter eating, the term "plant-based" is replacing "vegan" and "vegetarian" on some foods. The worry is that the v-words might have unappetizing or polarizing associations.
Impossible Foods, which makes a meatless patty that's supposed to taste like meat, even warns restaurants not to use those words when describing its burger on menus.
The trendier sounding "plant-based" may appeal to a broader market, since "vegan" or "vegetarian" could alienate those who don't adhere strictly to those diets. "Plant-based" may also distance products from a perception of vegan and vegetarian food as bland.
But some may see it as just a new term for an old concept.
George Clooney tops Forbes' highest-paid actors list
LOS ANGELES (AP) — George Clooney can raise a glass, even if he's not starring in any hit movies.
The 57-year-old tops the 2018 Forbes' list of highest-paid actors with $239 million in pretax earnings. Forbes credits up to $1 billion that a British conglomerate said it would pay for Casamigos Tequila, which Clooney co-founded in 2013 with two entrepreneurs. The actor's wealth also includes additional earnings from endorsements and older movies.
The rankings include on-screen and outside earnings.
Dwayne "The Rock" Johnson ranked second with $124 million pretax. Forbes says a huge social media following helped Johnson nearly double his 2017 earnings because he's able to negotiate an extra seven figures over his standard contract for promotion.
Robert Downey Jr. was third with $81 million, followed by Chris Hemsworth with $64.5 million and Jackie Chan's $45.5 million.