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Update on the latest business

January 18, 2019

FINANCIAL-MARKETS

Stocks surge

NEW YORK (AP) — Stocks are surging as renewed hopes for progress in trade talks between the U.S. and China contribute to a new sense of optimism on Wall Street.

Bloomberg News reported that China’s government offered to buy more goods and services from the U.S., potentially eliminating its trade deficit by 2024.

Technology and industrial companies are making some of the top gains. Deere & Co. jumped 3 percent and Microsoft gained 1.3 percent.

Banks rose after more of them posted strong fourth-quarter reports.

Timberland maker VF jumped 11.5 percent after raising its annual forecasts.

Electric car maker Tesla fell 9.2 percent after saying it will cut 7 percent of its jobs.

INDUSTRIAL PRODUCTION

US industrial production rose 0.3 percent in December

WASHINGTON (AP) — U.S. industrial production increased 0.3 percent in December, led by the biggest surge in manufacturing in ten months.

The Federal Reserve says that that manufacturing output jumped 1.1 percent last month, the largest gain since February 2018. Automakers drove much of the growth with a 4.7 percent jump in production.

Utility output slumped 6.3 percent amid an unseasonably warm December. Mining output rose 1.5 percent on in increased extraction of oil and natural gas.

Overall industrial production is up 4 percent from a year ago.

The industrial sector was using more of capacity, in a sign that they might need to invest more in equipment and facilities. Capacity utilization for manufacturers increased 0.7 points to 76.5 percent, a solid increase though that’s two points below the long-term average.

TRUMP-RUSSIA PROBE

Congress to probe report that Trump directed lawyer to lie

WASHINGTON (AP) — The House intelligence committee chairman said he will “do what is necessary” to confirm a published report that President Donald Trump directed his personal attorney Michael Cohen to lie to Congress about negotiations over a real estate project in Moscow during the 2016 election.

Democrat Rep. Adam Schiff of California says the allegation that Trump asked Cohen to lie “to curtail the investigation and cover up his business dealings with Russia is among the most serious to date.”

The report by BuzzFeed News, citing two unnamed law enforcement officials, says that Trump directed Cohen to lie to Congress and that Cohen regularly briefed Trump on the Moscow project. The Associated Press has not independently confirmed the report.

Trump’s personal attorney is denying that the president told Cohen to lie. Rudy Giuliani says in a statement that “Any suggestion— from any source— that the President counseled Michael Cohen to lie is categorically false.”

An adviser to Cohen, Lanny Davis, declined to comment.

EUROPE-US TRADE

EU insists farming is excluded from EU-US trade talks

BRUSSELS (AP) — The European Union is insisting to keep agriculture out of the EU-U.S. trade negotiations despite Washington’s wishes to include the vast sector.

The EU Commission announced Friday its proposals for a negotiating mandate from the 28 member states and said that the EU negotiations will be “strictly focused on the removal of tariffs on industrial goods, excluding agricultural products.”

EU Trade Chief Cecilia Malmstrom also said she is preparing a target list of American products it will hit with punitive tariffs if the Trump administration goes through with its threat to impose tariffs on European auto imports.

INDIA-VOLKSWAGEN

Volkswagen says it will pay Indian fine even as it appeals

NEW DELHI (AP) — Volkswagen Group says that it will pay a fine of 1 billion rupees ($14.2 million) imposed by India for installing software that allegedly cheated pollution testing devices, though it is still appealing the order.

A company statement says that it has challenged the National Green Tribunal’s order in India’s top court. Volkswagen says its cars were compliant with the emission norms in India.

The Indian panel on Nov. 16 said that Volkswagen diesel cars caused air pollution in the Indian capital due to excess nitrogen oxide emissions.

CHICKEN NUGGET-RECALL

Perdue recalls chicken nuggets due to wood contamination

WASHINGTON (AP) — Perdue is recalling more than 68,000 pounds of chicken nuggets because they may be contaminated with wood.

The gluten free Organics Breaded Chicken Breast Nuggets were produced on Oct. 25 and were sold at stores nationwide. They have a UPC bar code of 72745-80656 and the establishment number of P-33944 in the US Agriculture Department inspection mark.

The USDA says Perdue received three complaints that wood was found in the nuggets.

The USDA says there have been no confirmed reports of adverse reactions. However, the product should be thrown away or returned to the place of purchase.

Perdue says it is recalling the product out of an abundance of caution.

CVS HEALTH-WALMART

Walmart, CVS Health hammer out new PBM pharmacy network deal

BENTONVILLE, Ark. (AP) — Walmart will continue to operate through CVS Health’s pharmacy benefit management commercial and managed Medicaid retail pharmacy networks.

Including Walmart, the CVS Caremark national pharmacy network will have nearly 68,000 participating pharmacies for members to choose from, including independently-owned, community-based pharmacies, other local pharmacies in grocery stores and mass merchants and regional and national chains.

Shares of CVS have been under pressure since Tuesday when it said it could not come to an agreement with Walmart on pricing.

Walmart Inc. and CVS Health Corp. have an existing agreement for Walmart’s participation in the CVS Caremark Medicare Part D pharmacy network. Walmart’s Sam’s Club also has an existing deal to participate in the CVS Caremark pharmacy networks.

TIFFANY-HOLIDAY SALES

Tiffany holiday sales slip as Chinese tourists spend less

NEW YORK (AP) — Tiffany & Co. says holiday shoppers and Chinese tourists spent less on its bling.

The luxury jeweler, famous for its little blue boxes, says sales slipped in the holiday shopping season as Chinese tourists spent less while traveling due to the strong dollar, making it more expensive to buy Tiffany jewelry outside of its stores in China. The company also says it was hurt by the ups and downs of the stock market, the anxiety about Brexit and protests in Paris that forced the company to close its location there during some weekends.

Sales at established stores worldwide fell 2 percent in November and December, compared to the same period the year before.

Still, shares of the New York-based company rose Friday afternoon.

WINTER STORM-AMTRAK

Amtrak modifies service because of winter storms

WASHINGTON (AP) — Amtrak is modifying service in the Northeast and Midwest because of winter storms moving through the region.

The Capitol Limited, from Chicago to Washington, and the Lake Shoe Limited, from Chicago to New York, are canceled on Saturday.

On Sunday, five Acela trains and six Northeast Regional trains will not operate between New York and Boston. Six Keystone trains are canceled between New York and Harrisburg, Pennsylvania. Two Pennsylvanian trains are canceled between New York and Pittsburgh. Two Vermonter trains on Sunday will not run between St. Albans, Vermont, and New Haven, Connecticut.

Northeast Corridor service between New York and Washington will run as scheduled.

Amtrak passengers are advised to check on the status of their trains throughout the weekend.

OPIOID CRISIS-LAWSUITS

Lawsuits ramp up pressure on family that owns opioid company

UNDATED (AP) — The legal pressure on the family behind the painkiller OxyContin intensified this week and is likely to grow.

The Sackler family came under scrutiny when a legal filing in Massachusetts detailed how family members and other Purdue Pharma executives sought to push prescriptions for the drug and downplay its addiction risks.

A lawyer who has sued the family on behalf of New York’s Suffolk County says he expects similar claims against family members to be added to hundreds of lawsuits seeking to hold the drug industry accountable for an opioid crisis.

Documents used in the claims could also be used in more than 1,000 suits against the drug industry that have been consolidated under a federal judge.

Purdue has blasted the accusations as an attempt to vilify the company.

TOBACCO AGE LIMIT

Virginia looks to raise age limit on tobacco products

RICHMOND, Va. (AP) — Tobacco-friendly Virginia is preparing to raise the age limit on buying traditional and electric cigarettes from 18 to 21.

GOP leaders in the majority-Republican General Assembly announced Thursday they were backing legislation to raise the limit for all tobacco products, citing the rapid growth of teenage vaping.

Virginia-based tobacco giant Altria announced support for the legislation.

The surprise announcement by Republicans is part of a wider effort to broaden their appeal to suburban voters ahead of legislative elections later this year. Altria could also be looking to garner goodwill among lawmakers to diffuse a push for stricter laws on vaping and other tobacco products.

Other states have raised age limits, but Virginia has long been entwined with tobacco, which powered its economy when it was a colony 400 years ago.

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