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Update on the latest in business:

August 3, 2018


Asian markets flat after Apple value surpasses $1 trillion

BANGKOK (AP) — Asian shares were flat Friday in mixed trading ahead of the U.S. jobs report later in the day. There appeared to be scant carry-over Friday from overnight gains on Wall Street as Apple reached $1 trillion in value.

KEEPING SCORE: Japan’s Nikkei 225 was flat at 22,510.38 and the Shanghai Composite index added 0.1 percent to 2,770.14. Hong Kong’s Hang Seng index shed less than 0.1 percent to 27,705.68 and Australia’s S&P ASX 200 was down just 1.30 points at 6,239.60. South Korea’s Kospi added 0.6 percent to 2,283.01. Shares rose in Taiwan, Indonesia and Thailand but fell in Singapore.

WALL STREET: U.S. stocks climbed Thursday as Apple’s surge past the $1 trillion mark boosted technology shares. Apple jumped 2.9 percent to finish at $207.39. Electric vehicle maker Tesla soared 16.2 percent to $349.54 after it said production of its lower-cost Model 3 sedan is growing and CEO Elon Musk said the company doesn’t expect to need to raise more money from investors. Consumer products and health care companies rose as second-quarter results from corporate America continued to surpass investors’ expectations. The S&P 500 index rose 0.5 percent to 2,827.22. The Dow Jones Industrial Average slipped 7.66 points to 25,326.16. The Nasdaq composite jumped 1.2 percent to 7,802.69 and the Russell 2000 index of smaller-company stocks added 0.8 percent, to 1,682.10.

US JOBS: Optimistic employers likely stepped up hiring in July thanks to strong growth and consumer spending. Economists forecast that a report to be released later Friday will show employers added 191,000 jobs last month, down from 213,000 in June but easily enough to lower the unemployment rate over time. The jobless rate is projected to decline to 3.9 percent, near an 18-year low, from 4 percent.

ANALYST’S PERSPECTIVE: “July’s jobs data will be received with strong expectations brewing ahead of the release,” Jingyi Pan of IG said in a commentary. “The leads for Asia are constructive and indeed we are seeing U.S. futures in the black this morning, aiding the recovery from yesterday’s steep drop.”

TRADE: The White House escalated the trade conflict between the world’s two biggest economic powers, saying it may impose a 25 percent tax on $200 billion in imports from China, to take effect after a hearing and public comment. That is up from a 10 percent tax it proposed in June.

ENERGY: Benchmark U.S. crude picked up 10 cents to $69.06 a barrel in electronic trading on the New York Mercantile Exchange. It rose 1.9 percent to $68.96 a barrel in New York. Brent crude, used to price international oils, shed 1 cent to $74.44 per barrel. It gained 1.5 percent to $73.45 a barrel in London.

CURRENCIES: The dollar rose to 111.69 yen from 111.65 yen. The euro climbed to $1.1591 from $1.1587.


Strong US growth likely drove healthy job gain in July

WASHINGTON (AP) — With a robust economy at their backs, optimistic employers likely added jobs at a solid pace in July.

Economists forecast that employers added 191,000 jobs last month, down from 213,000 in June but easily enough to lower the unemployment rate over time. The jobless rate is projected to decline to 3.9 percent, near an 18-year low, from 4 percent.

The Labor Department’s monthly jobs report will be released at 8:30 a.m. Eastern Friday.

Consumers are spending freely and businesses are stepping up their investment in buildings and equipment, boosting growth even as the economic expansion enters its tenth year. That’s raising demand for workers in industries ranging from manufacturing to construction to health care.

The economy expanded at a 4.1 percent annual rate in the April-June quarter, the strongest showing in nearly four years. Oil and gas companies were a big driver: They nearly doubled their investment in new drilling rigs and other structures, adding as much as half a percentage point to growth. The new spending follows a 60 percent jump in oil prices in the past year.

Many companies have complained about the tariffs imposed by the Trump administration and the retaliation from overseas that they sparked. But so far, the trade fights haven’t impacted hiring. Trump slapped tariffs on steel and aluminum, as well as on $34 billion of Chinese imports. The European Union, Mexico, Canada and China have all responded with retaliatory duties.


Reports: Oregon has pot oversupply, Colorado hits the mark

PORTLAND, Ore. (AP) — Two of the first states to broadly legalize marijuana took different approaches to regulation that left Oregon with a vast oversupply and Colorado with a well-balanced market. But in both states prices for bud have plummeted.

A new Oregon report by law enforcement found nearly 70 percent of the legal recreational marijuana grown goes unsold, while an unrelated state-commissioned Colorado study found most growers there are planting less than half of their legal allotment — and still meeting demand.

The reports offer case studies for California and other pot-friendly states as they ramp up their legal pot industries. They also underscore some key differences in how broad legalization was handled that have helped shape differently evolving markets in each state.

The Oregon study released by the Oregon-Idaho High Intensity Drug Trafficking Area — a coalition of local, state and federal agencies — includes the medical and general-use markets and the illegal market, despite gaps in data on illicit marijuana grows.

It noted Oregon still has a serious problem with out-of-state trafficking and black market grows — and the top federal law enforcement officer in Oregon demanded more cooperation from state and local officials Thursday in a strident statement.

The Colorado study, released Thursday, focuses on the legal, general-use market, and researchers at the University of Colorado Boulder’s business school and a Denver consulting firm had access to state tracking data to produce the first-of-its-kind analysis.

Colorado sales of broadly legalized marijuana began in 2014, roughly two years before Oregon allowed marijuana to be sold at non-medical retail stores. From the beginning, Colorado had stricter regulations for its growers than Oregon did.


Judge: US must weigh cutbacks in top coal region by late ’19

BILLINGS, Mont. (AP) — A federal judge in Montana has given the Trump administration until late 2019 to analyze reductions to mining in the nation’s most productive coal fields as a way to fight climate change.

The order from U.S. District Judge Brian Morris, issued Tuesday, applies to the Powder River Basin of Montana and Wyoming. The region supplies about 40 percent of the nation’s coal, much of it from massive strip mines on public lands.

The case involves a challenge by environmentalists of U.S. Bureau of Land Management plans issued in 2015 to lease more than 10 billion tons of coal in the region. The plans also guide the leasing of oil and gas.

Morris turned down a request from environmentalists to halt new energy lease sales until the climate change review is completed. However, each individual lease issued will have to go through a review similar to the one Morris required for the region as a whole.

Bob LeResche with the Western Organization of Resource Councils said the climate change reviews “should have been done a long time ago.”

Representatives of the Wyoming Mining Association and Montana Coal Council did not immediately respond to telephone messages seeking comment.

Government officials had argued unsuccessfully that climate change could be addressed at individual mines rather than across the region.


Major business and economic reports due out today:

WASHINGTON (AP) — The Labor Department releases July’s employment data today.

And the Commerce Department reports on the U.S. trade gap for June.

Also, the Institute for Supply Management, a trade group of purchasing managers, issues its index of non-manufacturing activity for April.

Berkshire Hathaway Inc. reports quarterly financial results after the market closes.


DOJ opens review of Hollywood antitrust regulations

NEW YORK (AP) — Signaling that the antitrust regulations that have governed movie distribution for the last seven decades may be ripe for revision, the Department of Justice on Thursday opened a review of the famed Paramount Decrees.

The 1948 landmark Supreme Court decision of United States v. Paramount, known as “the Paramount Decrees,” effectively ended the old Hollywood system, outlawing such practices as “block booking,” in which studios required theaters to book a bundle of their films. It was part of antitrust efforts to prohibit the major studios from also controlling the country’s movie theaters.

Makan Delrahim, assistant attorney general for the Justice Department’s Antitrust Division, said Thursday that “much has changed in the motion picture industry.” Along with changes in theatrical exhibition, the corporations behind the major studios also own their own digital or television distribution channels.

The Department of Justice review will determine if the Paramount Decrees should be modified or terminated. It will begin with a 30-day public comment period.


Moonves of CBS mum on misconduct allegations

NEW YORK (AP) — Embattled CBS CEO Les Moonves says he is confident about the company’s future but made no statement about a pending investigation into allegations of sexual assault.

Moonves spoke Thursday during a call with industry analysts after the company’s second-quarter earnings report.

Two outside law firms are investigating allegations published in a New Yorker article last Friday that Moonves made unwanted sexual advances and took career retaliation against women who rebuffed him.

At the beginning of the call, Adam Townsend, the investor relations head at CBS, said questions from analysts would be limited to the quarterly results “in light of pending litigation and other matters, and on the advice of counsel.”

No questions were asked about the investigation.

CBS says its second quarter net income rose, boosted by higher fees from its network affiliates and subscribers.


Venezuela to relax currency controls amid economic crisis

CARACAS, Venezuela (AP) — Venezuela’s socialist government says it is relaxing strict controls that for years have limited currency exchanges, choking the economy.

The ruling party’s National Constitutional Assembly on Thursday voted to legalize certain transactions in currency exchange houses.

A once-wealthy oil country, Venezuela’s economy is crumbling in a five-year recession following two decades of socialist rule.

The law falls under President Nicolas Maduro’s new economic plan to combat the rampant black market and rescue the failing economy beset by soaring inflation.

Maduro has said that on Aug. 20 Venezuela will lop five zeros off its paper money to combat inflation, predicted this year to top 1 million percent.

However, opposition lawmaker Angel Alvarado says Maduro’s corrupt government only seeks to enrich its own members further manipulating the exchange market.

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