Stocks fall, bond prices rise as investors seek safe ground
NEW YORK (AP) — Stocks fell in midday trading Friday and bond prices rose as investors fretted about more signs that a viral outbreak was spreading and a report showing a sudden weakening in U.S. business activity.
Renewed anxiety over the global spread of the virus also pushed stocks lower on Thursday and knocked them off their record highs in what has been a volatile, holiday-shortened week. Indexes are on track for their first weekly loss after two weeks of gains.
Technology companies led the losses. Chipmakers, which rely heavily on China for both sales and supply chains, were some of the worst hit.
Companies that depend on consumer spending, especially in travel-related industries, also fell. So did General Motors and other automakers.
Deere jumped after the farm equipment maker handily beat Wall Street’s fiscal first-quarter profit forecasts. The company is coming out of an extended period in which it was bruised by the trade war between the U.S. and China.
Real estate companies and utilities held up better than the rest of the market. Bond prices rose, pushing yields lower. The price of gold, another haven for nervous investors, jumped 1.3%.
US home sales sales fell 1.3% in January
WASHINGTON (AP) â€” U.S. home sales retreated 1.3% in January from the prior month, but low mortgage rates helped enable an increase in purchases from a year ago.
The National Association of Realtors said Friday that sales of existing homes slipped last month to a seasonally adjusted annual rate of 5.46 million. Sales have climbed 9.6% over the past 12 months as borrowing costs have fallen. But sales could be squeezed in the coming months because of a shortage of homes listed for sale.
Just 1.42 million homes were on the market at the end of January, a 10.7% decline from a year ago. With fewer homes for sale, would-be buyers have fewer options and prices are rising faster than wage growth.
The median sales price in January was $266,300, up 6.8% from a year ago.
China suspends more penalties on US goods after trade truce
BEIJING (AP) — China on Friday suspended more punitive tariffs on imports of U.S. industrial goods in response to a truce in its trade war with Washington that threatened global economic growth.
Financial markets have welcomed announcements by both sides of reductions in penalties on each other’s goods, though they have yet to resolve much of the conflict that erupted in 2018 over Beijing’s technology ambitions and trade surplus.
Goods affected by the latest reduction include industrial components and medical and factory equipment, according to the Finance Ministry. It gave no details of the value of goods affected but said penalties were suspended for one year, effective Feb. 28.
The cuts come as China struggles with the mounting cost of measures imposed to contain a virus outbreak that has closed factories, stores and other businesses.
Under their “Phase 1” agreement signed in January, Washington agreed to cancel additional tariff hikes and Beijing committed to buy more American farm exports. U.S. officials said China also committed to addressing complaints about its technology policies.
Last week, the Trump administration reduced penalties on some Chinese imports.
Watchdog toughens global financial scrutiny of Iran
PARIS (AP) — An international agency monitoring terrorism funding announced tough new financial scrutiny of Iran on Friday and added seven countries to a watch list.
Pakistan, meanwhile, won a reprieve from the Financial Action Task Force at its meetings in Paris this week. The monitoring body gave Pakistan’s government another four months to crack down on terrorism financing and did not put the country on a damaging “black list.”
Iran and North Korea are the only two countries currently on the agency’s blacklist. That means international financial transactions with those countries are closely scrutinized, making it costly and cumbersome to do business with them. International creditors can also place restrictions on lending to black-listed countries.
The FATF decided on Friday to further tighten the screws on Iran — whose economy is already reeling — by imposing extra measures that could require audits on more transactions and make it even harder for foreign investors to do business there.
The group made the decision because Iran failed to fulfill its promises despite repeated warnings. In a statement, the organization said that Iran hasn’t done enough to criminalize terrorist financing, require transparency in wire transfers or freeze terrorist assets targeted by U.N. sanctions.
Iranian Foreign Ministry spokesman Abbas Mousavi called the decision “politicized” and a result of pressure from the United States, Saudi Arabia and Israel.
Trump tries new approach for $1 trillion infrastructure plan
JEFFERSON CITY, Mo. (AP) — As a presidential candidate in 2016, Donald Trump promised a $1 trillion infrastructure plan that would use tax incentives to spur private investment in public works projects.
He has so far failed to persuade Congress to pass anything like that.
In another election year, Trump has outlined a new $1 trillion plan for spending on roads, rails, water systems and other infrastructure. This time, the president is proposing to rely fully on federal spending. That fundamental change from his first plan drew praise from some state transportation officials and industry groups, even though Trump doesn’t spell out how to pay for it all.
Since outlining his budget proposal last week, Trump has done little to promote his new infrastructure plan. A politically divided Congress has no obligation to consider it. In fact, Trump’s prior infrastructure proposals all stalled, even when Republicans controlled both the House and Senate. Some Republicans already are lowering expectations.
Trump’s retooled infrastructure plan relies on existing fuel tax revenue to cover much of the cost. That allows him to include billions of dollars worth of projects that likely would have happened no matter who was president.
DOT ORG-DOMAIN NAMES
Firm makes concessions in bid to buy dot-org registry
LOS ANGELES (AP) — A private equity firm seeking to buy rights to operate the internet’s .org suffix said Friday it will cap price hikes and create an advisory board with veto powers to ease concerns from the nonprofit community.
Ethos Capital has offered $1.1 billion to buy the Public Interest Registry, the nonprofit corporation that runs the databases containing more than 10 million .org names registered worldwide.
Organizations ranging from the Girl Scouts of the USA and Consumer Reports to the American Bible Society have opposed the sale, warning of potential price gouging and censorship. California’s attorney general has also requested information to evaluate a deal’s potential impact to nonprofits.
Some critics fear a new owner could change policies — such as hiking the $10 annual fees the registry collects for each registered name — and reduce protections for domain name owners, including nongovernmental organizations that operate in authoritarian countries. A website can suddenly become unreachable, for instance, if the suffix owner decides to suspend a registration.
A sale to Ethos Capital wouldn’t immediately affect existing .org names or the websites that use them.