Update on the latest in business:

FINANCIAL MARKETS

Asian stocks rise on hopes for US trade progress

BEIJING (AP) — Asian stocks rose Friday on signs of possible progress in negotiations over Beijing’s tariff war with Washington.

China announced its economy czar, Vice Premier Liu He, will go to Washington for talks Jan. 30-31 aimed at ending the tariff war sparked by U.S. complaints about Beijing’s technology ambitions.

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On Wall Street, stocks climbed on trade optimism following the report Mnuchin might support a cut in U.S. penalty duties on Chinese imports. Technology, industrial and health care companies gained and makers of chemicals and other basic materials jumped. The Standard & Poor’s 500 index rose 0.8 percent to 2,635.96. The Dow Jones Industrial Average added 0.7 percent at 24,370.10. The Nasdaq composite gained 0.7 percent to 7,084.46.

Inflation in December came in weaker than expected, temporarily putting the central bank farther from its target of 2 percent. Prices rose 0.3 percent, down from November’s 0.8 percent, as tumbling food costs offset a rise in energy prices.

Benchmark U.S. crude oil rose above $52.50 per barrel.

The dollar advanced against the yen and declined against the euro.

MALAYSIA-FINANCIAL SCANDAL

Malaysia says Goldman Sachs must pay, apology not enough

PUTRAYAJAYA, Malaysia (AP) — Malaysia’s Finance Minister Lim Guan Eng said Friday that an apology by Goldman Sachs for its role in the alleged multibillion-dollar ransacking of state investment fund 1MDB was insufficient and that it must pay $7.5 billion as compensation.

Goldman CEO David Solomon apologized Wednesday to the Malaysian people for its former banker Tim Leissner’s role in arranging bond sales for 1MDB. Those sales provided a means for associates of former Malaysian Prime Minister Najib Razak to allegedly steal billions over several years from the fund.

Solomon has said the investment bank conducted due diligence but was misled by Leissner and former Malaysian government officials.

CHINA-GERMANY

China, German promise closer financial cooperation

BEIJING (AP) — China and Germany promised Friday to open their markets wider to each other’s banks and insurers, giving Beijing a burst of positive trade news amid conflicts with Washington and Europe.

The two sides affirmed support for a global trading system that other governments worry is threatened by President Donald Trump’s “America first” policies. That followed a regular annual meeting between German’s finance minister and China’s economy czar.

The initiatives reflect Beijing’s determination to press ahead with changes aimed at making its state-dominated economy more productive and to reduce reliance on the U.S. market by building commercial ties with other countries.

China has tried without success to recruit Germany as an ally in its tariff war with Trump. Berlin expresses support for free trade but Chancellor Angela Merkel has stressed her government is not taking sides.

Delegations led by German Finance Minister Olaf Scholz and China’s economy czar, Vice Premier Liu He, signed agreements to cooperate more closely on financial regulation.

AUDI EMISSIONS-INDICTMENT

Grand jury charges 4 Audi managers in emissions case

DETROIT (AP) — A federal grand jury in Detroit has indicted four Audi engineering managers from Germany in a widening diesel emissions cheating scandal.

Richard Bauder, Axel Eiser, Stefan Knirsch and Carsten Nagel were named in a 12-count indictment alleging conspiracy, wire fraud and violations of the Clean Air Act.

The indictment, released Thursday, alleges the men took part in nearly a decade-long conspiracy to deceive the Environmental Protection Agency by cheating on emissions tests for 3-liter diesel engines.

None of the four is in custody, and they are believed to be in Germany, a Justice Department spokesman said.

Audi is a luxury brand owned by German automaker Volkswagen. A VW spokesman said he could not comment about whether the men still work for the company.

Volkswagen pleaded guilty in 2016 to criminal charges in the scandal and will pay more than $30 billion in penalties and lawsuit settlement costs.

The men bring to 13 the number of VW employees charged in the scandal, in which VW used software on about 600,000 vehicles to turn pollution controls on during EPA tests and turn them off while on the road. Two have pleaded guilty and are serving jail time, while six others, including former VW CEO Martin Winterkorn, remain in Germany.

SEARS-SURVIVAL

Sears creditors challenge hedge fund chairman’s winning bid

NEW YORK (AP) — A group of Sears creditors are challenging Chairman Eddie Lampert’s hedge fund’s winning $5.2 billion bid to buy the business in a bankruptcy auction and wants to air their grievances in court.

Sears confirmed Thursday that Lampert’s hedge fund won tentative approval for the plan to buy 425 stores and the rest of its assets. The move preserves 45,000 jobs and is subject to court approval on Feb. 1 and is expected to then close Feb. 8.

But in a court filing Thursday, the Sears creditors contend that Lampert has painted himself as the savior of the company, but has instead made a series of moves over the years that have benefited himself and his hedge fund ESL.

The committee of unsecured creditors, which rank at the bottom to get paid, has been critical of Lampert since Sears filed for Chapter 11 bankruptcy protection in mid-October, and has been pushing for liquidation.

Lampert has been selling off some of Sears’ most prized brands, including Craftsman. The company also spun off Lands’ End. Four years ago, it created a real estate investment trust to extract revenue from its properties. It sold and leased back more than 200 properties to the REIT, in which Lampert is a significant stake holder.

ESL said in a statement that all transactions injected much needed liquidity into the business, were done in good faith and were also approved by the company’s board, including independent directors.

ECONOMY-THE DAY AHEAD

Major business and economic reports scheduled for today.

WASHINGTON (AP) —The Federal Reserve releases its report on December industrial production today.

GOVERNMENT SHUTDOWN-BENEFITS

Federal workers caught in the middle apply for unemployment

PROVIDENCE, R.I. (AP) — Thousands of federal employees and their families are applying for unemployment and food stamps to get by as the longest government shutdown in U.S. history drags on with no end in sight. But for some of them, it has been an exercise in confusion and frustration.

Others, meanwhile, are hesitant to apply, knowing they will have to pay back the unemployment benefits when they finally return to work.

The U.S. Labor Department on Thursday reported that the number of furloughed federal employees seeking unemployment benefits has jumped, from fewer than a thousand per week before the shutdown to more than 10,000 during the week that ended Jan. 5.

The nearly 4-week-old stalemate over President Donald Trump’s demand for funding for a border wall affects about 800,000 employees.

EARNS-NETFLIX

Netflix’s solid 4Q eclipsed by projected slowing US growth

SAN FRANCISCO (AP) — Netflix’s video streaming service added more subscribers than ever during the crucial holiday season, but the company signaled its growth is slowing in the U.S. as it begins to roll out double-digit price increases in its biggest market.

The slightly disappointing forecast issued Thursday for the opening three months of the new year overshadowed a solid earnings report covering the final quarter of last year.

It earned $133.9 million, or 30 cents per share, for the fourth quarter, a 28 percent decrease from $185.5 million, or 41 cents per share, at the same time in the prior year. The earnings per share exceeded the average estimate of 24 cents among analysts surveyed by Zacks Investment Research.

Revenue for the past quarter climbed 27 percent from the previous year to $4.2 billion, in line with analysts’ estimates.

Netflix ended December with 139.3 million paid subscribers, slightly better than analysts had anticipated, according to FactSet.

CHINA-ECONOMY BLUES

China slump squeezes workers, hammers consumer spending

BEIJING (AP) — China’s slowing economy is squeezing the urban workers and entrepreneurs the ruling Communist Party is counting on to help transform this country from a low-wage factory floor into a prosperous consumer market.

Headline economic numbers still look healthy. Growth in 2019 is forecast at more than 6 percent, down only slightly from about 6.5 percent last year. But it is propped up by higher government spending, which masks sharp declines in other areas. Those are spooking the public and discouraging spending, which could make the downturn worse.

A tariff war with Washington over Beijing’s technology ambitions is adding to anxiety over job losses and tumbling sales of cars, real estate and consumer goods that are hitting China’s trading partners and global companies that increasingly count on Chinese consumers.

AUDI EMISSIONS-INDICTMENT

Grand jury charges 4 Audi managers in emissions case

DETROIT (AP) — A federal grand jury in Detroit has indicted four Audi engineering managers from Germany in a widening diesel emissions cheating scandal.

Richard Bauder, Axel Eiser, Stefan Knirsch and Carsten Nagel were named in a 12-count indictment alleging conspiracy, wire fraud and violations of the Clean Air Act.

The indictment alleges the men took part in nearly a decade-long conspiracy to deceive the Environmental Protection Agency by cheating on emissions tests for 3-liter diesel engines.

It’s not clear whether the men are in custody. Messages were left Thursday seeking comment from government and Audi spokesmen.

Audi is a luxury brand owned by German automaker Volkswagen. VW pleaded guilty in 2016 to criminal charges in the scandal and will pay more than $30 billion in penalties and settlement costs.

SEXUAL MISCONDUCT-WEINSTEIN

Harvey Weinstein breaks with his criminal defense lawyer

NEW YORK (AP) — Harvey Weinstein’s high-profile criminal defense lawyer is leaving the movie producer’s rape case weeks after failing to get the charges dismissed.

Benjamin Brafman filed court papers on Thursday asking to withdraw as Weinstein’s lawyer. The filing came after a week of speculation about his involvement in the case.

A judge must still approve the move.

Weinstein and Brafman said in a joint statement that their split was amicable.

Brafman has advocated for Weinstein in and out of the courtroom.

He won a victory in October when prosecutors dropped part of the case after evidence surfaced that a police detective had coached a witness.

But he was disappointed last month when a judge rejected his push to throw out the rest of the case.

Weinstein’s trial is tentatively scheduled for May.

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