FINANCIAL MARKETS

Asia tracks French election rally; weak yen lifts Tokyo

TOKYO (AP) — Shares are higher in Asia today, tracking the rally sparked by the outcome of France’s vote. Hopes for U.S. tax reform and a compromise on the U.S. budget deadline also lifted sentiment. Japan’s benchmark gained as the dollar remained near the 110 yen level, helping shares of exporters.

The lead taken by Emmanuel Macron, a candidate who investors see as pro-business, in the first round of France’s presidential election raised expectations that the European Union will hold together.

On Wall Street yesterday, U.S. shares were buoyed by the news from France and also strong earnings reports. The Standard & Poor’s 500 index jumped 1.1 percent to 2,374.15. The Dow Jones industrial average also rose 1.1 percent, to 20,763.89. The Nasdaq composite gained 1.2 percent to 5,983.82. The VIX index that many investors see as a measure of the market’s fear level plunged 25 percent.

Benchmark U.S. crude oil rose but remained below $49.50 a barrel.

The dollar gained against the yen and fell against the euro.

THE DAY AHEAD

New home sales, other reports, due Tuesday

WASHINGTON (AP) — The Commerce Department’s report on sales of new homes in March is among a host of economic indicators due out later today.

The Conference Board is set to issue the Consumer Confidence Index for April.

Meanwhile, the Coca-Cola Co., reports financial results before the market opens, as do Caterpillar Inc., and McDonald’s Corp. Chipotle Mexican Grill Inc., reports its quarterly financial results after the market closes.

CONGRESS-BUDGET

Prospects for an accord on a stopgap spending bill dimming amid partisan strife

WASHINGTON (AP) — The clock is ticking on a deadline Congress faces late this week in order to avoid a government shutdown.

Partisan disputes over health care and President Donald Trump’s border wall are jeopardizing the spending legislation that Congress has to pass by midnight Friday.

The border wall money is fiercely opposed by Democrats, whose votes are needed to pass the legislation, and they are equally incensed over Trump’s threat to deprive former President Barack Obama’s health care law of key funds to help poor people.

Those were the most pressing unresolved issues confronting lawmakers as they returned Monday from a two-week spring recess to face a critical deadline. Congress must pass a $1 trillion catch-all spending bill to pay for all agencies of government by midnight Friday or trigger a partial shutdown the next day, which happens to coincide with the 100th day of Trump’s presidency.

WELLS FARGO-ANGRY SHAREHOLDERS

Wells Fargo to face irritated shareholders at annual meeting

JACKSONVILLE, Fla. (AP) — Wells Fargo’s top management and board of directors will face irritated investors today for the first big shareholder meeting since the scandal over the bank’s sales practices led to an executive shake-up, fines and a dented reputation.

The bank has changed the way it pays branch employees, reclaimed promised compensation to several executives and apologized to customers after regulators imposed $185 million in fines last September. Authorities said Wells Fargo workers opened up to 2 million accounts without customer permission as employees tried to meet aggressive sales goals.

It’s likely that Wells Fargo’s top management will apologize to shareholders. CEO Tim Sloan, who got that job in October, has repeatedly talked of making things right with customers. Wells has seen a sharp decline in new customers and remains under investigation by various authorities.

Wells Fargo’s executives are expected to face calls for their ouster. Shareholder proposals call for an overhaul of the bank’s corporate governance as well as more investigations into the pressure-filled corporate culture.

An investigation by the bank’s own board of directors found that the problems at Wells Fargo and its overly aggressive sales culture date back at least 15 years, and that executives had little interest in dealing with the issue.

TRUMP-LUMBER

Trump slaps tariff on Canadian softwood lumber

WASHINGTON (AP) — The Trump administration has moved to impose a 20 percent tariff on softwood lumber entering the United States from Canada, escalating an intensifying trade dispute between the two countries.

The president announced the decision during a gathering with conservative media outlets at the White House Monday evening. Trump’s initial comments were relayed by four people who were in the room and confirmed by an administration official.

The Commerce Department later announced it had reached a preliminary determination and would impose countervailing duties ranging from 3 percent to 24 percent on imported softwood lumber, with an average of about 20 percent.

One person in the room said Trump threatened that dairy could be next.

The U.S. and Canada typically enjoy a friendly trading relationship, but things have soured in recent months.

The Canadian government, meanwhile, rejected the assessment, calling the duty “unfair and punitive.”

They warned the action would have a negative impact on American families who will have to pay more to build or renovate homes. And they said they would sue, if necessary.

EUROPE-ECONOMY

ECB unlikely to signal stimulus end, despite French optimism

FRANKFURT, Germany (AP) — Europe’s strengthening economy dodged a banana peel when a pro-EU candidate won the first round of the French presidential election.

That won’t be enough, however, to make the European Central Bank signal an end to monetary stimulus program on Thursday. Nor will Sunday’s result by itself fix the long-term flaws that have plagued the continent’s shared currency, the euro.

Former Economy Minister Emmanuel Macron, who supports keeping France in the euro, came in first in the presidential vote with 23.9 percent, ahead of anti-euro, anti-EU nationalist Marine Le Pen, who got 21.4 percent. Polls show Macron well ahead of Le Pen in the May 7 runoff. His election would remove a potential stumbling block for the 19-country eurozone: Le Pen’s promise to take France out of the euro could have shaken financial markets and dented the confidence needed for businesses to invest.

Yet analysts think that ECB President Mario Draghi will give no sign that the bank is ready to start withdrawing its stimulus support after Thursday’s meeting of the 25-member governing council. They say Draghi won’t want to create any uncertainty for markets before the second round in France is over.

The stimulus entails injecting 60 billion euros ($65 billion) a month into the financial system by buying bonds.

TRUMP-OFFSHORE DRILLING

Trump to sign orders on oil drilling, national monuments

WASHINGTON (AP) — President Donald Trump will sign executive orders this week aimed at expanding offshore oil drilling and reviewing national monument designations made by his predecessors. This will continue the Republican’s assault on Democratic President Barack Obama’s environmental legacy.

The orders could expand oil drilling in the Arctic and Atlantic oceans and upend public lands protections put in place in Utah, Maine and other states. The Antiquities Act of 1906 authorizes the president to declare federal lands of historic or scientific value to be “national monuments” and restrict how the lands can be used.

Administration officials on Monday confirmed the expected moves. The officials spoke on condition of anonymity to freely discuss the president’s upcoming actions.

SUPREME COURT-GM-IGNITION SWITCH

GM appeal of ignition switch ruling rejected by high court

WASHINGTON (AP) — The Supreme Court has turned aside an appeal from General Motors Co. seeking to block dozens of lawsuits over faulty ignition switches.

The attorney for one plaintiff in the case said the court’s stance could expose the company to billions of dollars in additional claims.

Without comment, the justices on Monday left in place a lower court ruling that said the automaker’s 2009 bankruptcy did not shield it from liability in the cases.

An attorney representing hundreds of plaintiffs who are suing the company said it exposes GM to around 1,000 additional lawsuits and $5 billion to $10 billion in liabilities. GM said the cases will have to be tried on individual merits.

TRUMP-LABOR

Trump slaps tariff on Canadian softwood lumber

WASHINGTON (AP) — The Trump administration has moved to impose a 20 percent tariff on softwood lumber entering the United States from Canada, escalating an intensifying trade dispute between the two countries.

President Donald Trump announced the decision during a gathering with conservative media outlets at the White House Monday evening. Trump’s initial comments were relayed by four people who were in the room and confirmed by an administration official.

On Twitter, Breitbart News White House correspondent Charlie Spiering quoted Trump as saying, “We’re going to be putting a 20% tax on softwood lumber coming in — tariff on softwood coming into the United States from Canada.”

The Commerce Department later announced it had reached a preliminary determination and would impose countervailing duties ranging from 3 percent to 24 percent on imported softwood lumber, with an average of about 20 percent.

WRITERS GUILD STRIKE

Writers Guild votes to authorize strike as talks continue

LOS ANGELES (AP) — Members of the Writers Guild of America are one step closer to striking come May 2. In a letter to its members Monday, the WGA said 96.3 percent voted to authorize a strike as the May 1 contract expiration deadline looms. Negotiations between the Guild and the Alliance of Motion Picture and Television Producers will resume Tuesday.

Responding to the strike authorization, the producers group said in a statement that it is committed to reaching a deal that keeps the industry working.

The producers group aims to avoid a work stoppage like the 100-day strike of 2007.

While many issues are at play, members of the Writers Guild are largely focused on the way in which streaming platforms have affected compensation.

The WGA did not immediately respond to request for comment.

EARNS-EXPRESS SCRIPTS

Express Scripts expects to lose biggest customer after 2019

ST. LOUIS (AP) — Shares of Express Scripts Holding Co. tumbled in extended trading after the prescription drug manager said its biggest customer, Anthem, doesn’t plan to extend its contract when it expires 2019.

The St. Louis-based company Express Scripts said Monday that Anthem, which is the nation’s second-largest health insurer, isn’t interested in contract talks even though Express offered discounts worth up to $1 billion a year.

Express Scripts stock fell $10.11, or 15 percent, to $56.96 in after-hours trading after the company announced the Anthem news along with its first-quarter results. Anthem accounted for about 18 percent of Express Scripts’ first-quarter revenue.

The two companies have been fighting over prescription drug costs for several years, and Anthem even filed a lawsuit against Express Scripts last year over drug prices.

MET LIFE-TOO BIG TO FAIL? MetLife asks court to put hold on ‘too big to fail’ case

WASHINGTON (AP) — Insurance giant MetLife has asked a federal appeals court to put on hold a ruling on whether the government can tag the company as a potential threat to the financial system.

The insurer said in a court filing that the case should be halted pending a government report requested by President Donald Trump.

The company took the government to court in 2015 to appeal its labeling of MetLife as “systemically important” — so big and enmeshed with the financial system that its collapse could threaten the economy.

Trump last week asked federal regulators to review the decision by the Financial Stability Oversight Council. The council was created by the 2010 Wall Street overhaul law to monitor the financial system and prevent another crisis.

TRUMP TAX PLAN

US Treasury secretary: Tax cuts won’t raise budget deficit

WASHINGTON (AP) — Treasury Secretary Steven Mnuchin (mih-NOO’-shin) says the Trump administration’s tax reform will generate so much economic growth that the budget deficit will be held in check.

Mnuchin said at the Monday White House news briefing: “The tax reform will pay for itself.”

Most economists say it’s unlikely that tax cuts can generate enough growth to prevent the budget deficit from rising.

The administration has yet to provide details about its planned tax reforms. President Donald Trump has pledged a massive tax cut and said the middle class would benefit. He told The Associated Press in an interview that elements of his plan will be released as early as Wednesday.

ITALY-ALITALIA

Alitalia workers turn down deal to avoid airline bankruptcy

ROME (AP) — Alitalia employees have rejected a government-brokered package of job and wage cuts that was aimed at saving Italy’s flagship airline from bankruptcy.

Immediately after the “no” votes won in a referendum on the proposed industrial plan that Italian Premier Paolo Gentiloni had linked to Alitalia’s survival, a union leader called on banks and other investors to devise another strategy to ensure a future for the airline.

Claudio GTarlazzi, a leader of the union, says on RAI News24 state TV, “The country needs Alitalia, and 12,500 people don’t deserve to go home” jobless. He urged banks and shareholders to “show good sense” and called for renewed negotiations with unions for a revised industrial plan.

EARNS-UNISYS

Unisys’ adjusted earnings top estimates, stock surges

BLUE BELL, Pa. (AP) — Shares in Unisys Corp. surged after its adjusted quarterly earnings topped Wall Street expectations.

The information technology service provider reported a loss of $32.7 million, or 65 cents a share, in its first quarter.

But it said its earnings — adjusted to exclude pension expenses and charges related to cost cutting — amounted to 30 cents a share. Analysts polled by FactSet were expecting 22 cents a share on that basis.

It posted revenue of $664.5 million in the period.

Unisys expects full-year revenue in the range of $2.65 billion to $2.75 billion.

SEAFOOD PROCESSOR-AIR VIOLATIONS

Seafood processor, EPA settle on Alaska clean air violations

ANCHORAGE, Alaska (AP) — A Seattle-based seafood processing company operating in Alaska will be assessed a $1.3 million civil penalty for violating clean air rules under a proposed settlement with the U.S. Environmental Protection Agency and the state of Alaska.

Westward Seafoods, owned by Maruha Nichiro Corp. of Japan, also would be required to pay $1.1 million for air pollution reduction projects and more than $800,000 for improved training and monitoring of emissions.

It’s the second civil penalty for the company in seven years. Westward Seafoods in 2010 signed a consent decree with EPA and the U.S. Department of Justice and paid a $570,000 penalty to resolve previous violations.

The new violations follow Westwards’ self-reporting that three employees turned off air pollution controls from 2009 to 2011 at the company’s plant at Dutch Harbor, a port on Unalaska, one of the Aleutian Islands. Dutch Harbor regularly leads the nation in seafood brought to shore by weight.

SAMSUNG-PHONE BREAKAGE

Tests find Samsung’s S8 phones more prone to screen cracks

NEW YORK (AP) — Samsung’s latest phones feature big wraparound screens and lots of glass. They also appear to break more easily, according to tests run by SquareTrade, a company that sells gadget-repair plans.

The nearly all-glass design of Samsung’s Galaxy S8 and S8 Plus makes them beautiful, SquareTrade said, but also “extremely susceptible to cracking when dropped from any angle.”

Samsung had no comment. It did say that advanced orders for the S8 were 30 percent higher than that for the Galaxy S7 phones. The company didn’t release specific figures. The S8 starts at $750, which is about $100 higher than the S7.

KANSAS-AMUSEMENT PARKS

Governor tightens regulations after boy’s waterslide death

TOPEKA, Kan. (AP) — The death of a colleague’s son has spurred lawmakers in the often anti-regulation Kansas to toughen the state’s inspection requirements for amusement parks.

Republican Gov. Sam Brownback signed legislation on Monday that strengthens amusement park regulations. The bill passed the House and Senate by wide margins.

The change comes after Republican Rep. Scott Schwab’s 10-year-old son, Caleb, died last summer on a waterslide at Schlitterbahn Waterpark in Kansas City, Kansas.

An investigation into the death is ongoing, but the waterslide, which was dubbed the world’s highest when it opened, has been closed since the accident.

The Schwab family has settled with the park’s owner, the manufacturer of the raft that carried riders down the slide, a general contractor and a consulting company.

FILM-BOX OFFICE

‘Fast 8’ races to No. 1 among box office attractions

LOS ANGELES (AP) — “The Fate of the Furious” topped the box office for the second week in a row with $38.4 million, bringing the total North American take for the film to $163.3 million. With international grosses, the film is expected to cross $1 billion this week.

Holdovers crushed a slew of underwhelming newcomers, including Disney Nature’s “Born in China,” which opened in sixth place with $4.8 million; the steamy thriller “Unforgettable” that debuted in seventh with $4.8 million; and the costly historical epic “The Promise,” which launched in ninth place with only $4.1 million.

The top films looked much the same as the past few weeks, with “The Boss Baby” in second with $12.7 million and “Beauty and the Beast” in third with $9.7 million.

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