Asian shares fall on China stimulus worries, weak earnings
BANGKOK (AP) — Shares were mostly lower in Asia on Friday after an overnight decline on Wall Street spurred by disappointingly weak earnings reports from 3M and other industrial companies.
Traders are watching for U.S. growth data later in the day and China-U.S. trade talks next week in Beijing.
Disappointingly weak earnings reports from 3M and other industrial companies kept U.S. stock indexes in check on Thursday, blotting out a set of blowout results from big-name tech companies.
The S&P 500 edged 1.08 points lower to 2,926.17 while the Dow Jones Industrial average dropped 0.5%, to 26,462.08. The Nasdaq composite rose 0.2% to 8,118.68.
Tech companies have been leading the way this year, as the S&P 500 index returned to a record this week, on expectations that they can continue to deliver strong growth despite a slowing global economy. And many are delivering: Revenue jumped 14% for Microsoft and 26% for Facebook from a year ago.
Benchmark U.S. crude gave slipped below $65 per barrel.
The dollar was trading at 111.67 Japanese yen, up from 111.63 yen on Thursday. The euro was unchanged at $1.1133.
Putin: Belt and Road fits with Eurasian Economic Union goals
BEIJING (AP) — Russian President Vladimir Putin says China’s Belt and Road infrastructure initiative meshes perfectly with the goals of the Russian-led Eurasian Economic Union.
Putin’s comments to a Belt and Road forum in Beijing may help alleviate concerns over potential tensions between China and Russia, given Beijing’s rapidly expanding economic footprint in Central Asia, Moscow’s traditional sphere of influence.
Putin told some three-dozen leaders attending the conference that China’s moves “fit perfectly into our plans.”
The Eurasian Economic Union groups Russia with Armenia, Belarus, Kazakhstan and Kyrgyzstan in a common market that seeks to remove barriers to the free movement of goods, services, capital and labor.
The five member states “unanimously supported the idea of linking the construction of the Eurasian Economic Community” and the Belt and Road, Putin said.
Separately, Putin met Friday with Chinese President Xi Jinping. He visited Beijing just after wrapping up a summit with North Korean leader Kim Jong Un in Russia’s Far Eastern port city of Vladivostok.
Deutsche Bank earnings up in 1st quarter but revenues drop
BERLIN (AP) — Deutsche Bank says it saw its profit improve by 67 percent in the first quarter, though revenue dropped 9 percent as proceeds from trading declined sharply.
Germany’s biggest bank reported details of its January-March earnings on Friday, a day after it abandoned talks on a possible merger with German peer Commerzbank.
The company said net profit was 201 million euros ($224 million), compared with 120 million euros a year earlier.
Revenues dropped to 6.35 billion euros from 6.98 billion euros. The bank said revenues from fixed income sales and trading were off 19 percent at 1.5 billion euros, while those from equity sales and trading dropped 18 percent to 468 million euros.
CEO Christian Sewing said that “our continued cost discipline helped us to offset lower revenues.”
ECONOMY-THE DAY AHEAD
Business and economic reports scheduled for today
WASHINGTON (AP) — The Commerce Department releases the first quarter gross domestic product today.
Also, American Airlines and Exxon Mobil report quarterly financial results before the market opens.
Amazon Prime to be 1-day shipping instead of 2
NEW YORK (AP) — Amazon says its free shipping for Prime members will be even faster, promising one-day shipping on most items instead of two-day delivery.
The company didn’t say when the change would happen, but says it has been growing its warehouses and shipping network to offer faster deliveries.
Amazon has long offered delivery in a day or quicker for some items, but the change will mean free one-day shipping will be the default, rather than two-day.
The move is likely to put even more pressure on big retailers, which have been racing to ship faster to catch up with Amazon.
Amazon says it will start to offer one-day shipping to its U.S. Prime members. In some other countries, such as the U.K., Prime members are already offered one-day shipping.
Meanwhile, Amazon’s first quarter profit more than doubled from a year ago.
The Seattle-based company on Thursday reported net income of $3.56 billion, or $7.09 per share, for the first three months of the year.
Revenue rose 17% to $59.7 billion, which also beat Wall Street expectations.
INTERNET SALES TAXES
California governor signs internet sales tax law
SACRAMENTO, Calif. (AP) — California’s Democratic governor has signed a law requiring companies like Amazon and eBay to collect sales taxes on behalf of some out-of-state sellers.
The law comes after the U.S. Supreme Court ruled last year states can collect sales taxes from companies even if the company is based outside of the state’s borders.
After the ruling, existing state law required sellers with at least $100,000 of sales in California to register as a retailer and collect taxes. The law Gov. Gavin Newsom signed on Thursday requires companies like Amazon and eBay to collect the taxes on behalf of those retailers, but only if they have at least $500,000 of annual sales in California.
State officials predict the law will generate an extra $759 million in state and local taxes by 2021.
WASHINGTON (AP) — The Trump administration is reevaluating its controversial plan to sharply expand offshore drilling as it responds to a court ruling that blocked drilling off Alaska.
President Donald Trump has pushed to open nearly all U.S. coastlines to offshore oil and gas drilling. But a federal judge last month ruled against Trump’s executive order to open the Arctic and parts of the Atlantic. Coastal states also have opposed the expanded drilling.
Interior Secretary David Bernhardt told The Wall Street Journal on Thursday that the legal challenges may be “discombobulating” to the administration’s overall drilling plans. Bernhardt says the administration may have to wait for the challenges to fully play out in court.
Interior spokeswoman Molly Block says the agency “is evaluating all of its options.”
MGM Resorts announces 254 layoffs, says more job cuts coming
LAS VEGAS (AP) — Las Vegas-based casino company MGM Resorts International has announced a first phase of layoffs in a cost-cutting operational shift as it aims to boost earnings.
The Las Vegas Review-Journal reports the 254 layoffs announced Thursday will cut labor costs by $100 million.
In a letter to employees, CEO Jim Murren calls it streamlining and says more positions will be eliminated in coming weeks.
MGM Resorts in January announced its MGM 2020 plan to boost earnings by $200 million by next year.
It says the current cuts affect managers, not union workers.
The company has about 77,000 employees and is the largest employer in Nevada.
It’s under investor pressure to improve earnings after share prices have fallen 12 percent since August.
GOOGLE-SEXUAL MISCONDUCT GUIDELINES
Google updates misconduct reporting amid employee discontent
SAN FRANCISCO (AP) — Google says it has updated the way it investigates misconduct claims, changes it pledged to make after thousands of employees walked out in protest last November.
Earlier this week, two walkout organizers claimed that they faced Google retaliation for helping to put together that protest.
The company says its changes make it simpler for employees to file complaints about sexual misconduct or other harassment. Google’s updated guidelines outline what employees should expect during the investigation process.
Organizers called the November walkouts, which drew participants from Google offices around the world, to protest the company’s handling of sexual misconduct claims and payouts to executives.
Google denies the retaliation claims.
CANADA FACEBOOK PRIVACY
Canada privacy watchdog taking Facebook to court
OTTAWA, Ontario (AP) — Canada’s privacy czar is taking Facebook to court after finding the social-media giant’s lax practices allowed personal information to be used for political purposes.
A joint report from privacy commissioner Daniel Therrien and his British Columbia counterpart released Thursday says it uncovered major shortcomings in Facebook’s procedures and called for stronger laws to protect Canadians.
The commissioners expressed dismay that Facebook had rebuffed their findings and recommendations.
Facebook insists it took the investigation seriously. The social media giant says it offered to enter into a compliance agreement.
The probe followed reports that Facebook let an outside organization use an app to access users’ personal information, and that some of the data was then passed to others. Recipients of the information included the firm Cambridge Analytica.
REAR SEAT CRASH SAFETY
Rear seats of cars need better safety equipment, study says
UNDATED (AP) — The Insurance Institute for Highway Safety says in a new report that safer restraint systems are needed for the backseats of cars. The study finds that rear-seat safety has not kept pace with front-seat safety.
The study looked at 117 front crashes that resulted in a backseat passenger who was wearing a seatbelt getting killed or seriously injured. The study says many of these could have been survivable with upgrades in design and safety equipment.
Many chest injuries in these cases were caused by force from seatbelts.
The institute, which was founded by auto insurers, suggests car makers look into more sophisticated safety technologies in the backseat, including air bags that deploy from the ceiling.
ACLU LAWSUIT-ISRAEL BOYCOTT BAN
Federal judge blocks enforcement of anti-Israel boycott law
AUSTIN, Texas (AP) — A federal judge has blocked enforcement of a Texas law that requires contractors to certify that they don’t boycott Israel.
In a 56-page opinion filed Thursday, U.S. District Judge Robert Pitman of Austin said boycotts are protected free speech, declaring the law fails to serve a compelling state interest.
The American Civil Liberties Union of Texas filed the federal suit in December against Texas Attorney General Ken Paxton and others. It argued the law forces people to choose between their First Amendment rights and their livelihoods.
Texas is among 25 states that has enacted similar bans on participation in the “boycott, divest and sanction Israel” movement against Israel’s treatment of Palestinians. He said the statute “threatens ‘to suppress unpopular ideas’ and ‘manipulate the public debate through coercion rather than persuasion.”
CHINA-NEW SILK ROAD
China’s Xi promotes building initiative amid debt worries
BEIJING (AP) — President Xi Jinping has promised to promote high financial standards for China’s Belt and Road infrastructure-building initiative as Beijing tries to dispel complaints the multibillion-dollar project leaves developing countries with too much debt.
Xi avoided mentioning debt complaints in a speech Friday at the opening of a forum to celebrate his signature foreign initiative. But he said Beijing wants “open, green and clean cooperation” with “zero tolerance for corruption.”
Developing countries welcome the initiative to expand trade by building roads, ports and other facilities across Asia and Africa to Europe. But high costs have prompted complaints some are falling into a “debt trap.”
Chinese officials reject such complaints and issued guidelines this week for assessing debt risks to Belt and Road borrowers.
CALIFORNIA OIL SPILL FINE
Firm fined $3.3M for worst California oil spill in 25 years
SANTA BARBARA, Calif. (AP) — A pipeline company was fined nearly $3.35 million on Thursday for causing the worst California coastal spill in 25 years.
A judge issued a fine and penalties against Plains All American Pipeline for a 2015 spill that sent 140,000 gallons of crude oil gushing onto Refugio State Beach in Santa Barbara County, northwest of Los Angeles. The spill from a corroded pipeline blackened popular beaches for miles, killed wildlife and hurt tourism and fishing.
Federal inspectors found that Plains had made several preventable errors, failed to quickly detect the pipeline rupture and responded too slowly as oil flowed toward the ocean.
Inspectors found that Plains operators working from a Texas control room more than 1,000 miles away had turned off an alarm that would have signaled a leak and, unaware a spill had occurred, restarted the hemorrhaging line after it had shut down, which only made matters worse.