Update on the latest in business:
Stocks erase early losses
NEW YORK (AP) _ Stocks are erasing early losses in midday trading on Wall Street, with the major indexes turning mixed. It’s the latest spin cycle for a market that’s been tossed around the last two weeks by rising and falling worries about the global trade war.
Demand for safe Treasury bonds dissipated following a report that U.S. shoppers remain more confident than economists expected.
Deere shares dropped after the farm equipment maker’s second-quarter earnings missed Wall Street expectations. Deere also lowered its outlook for the year due to the trade war and a weakened agriculture sector.
Trump delays imposing auto tariffs on auto imports and parts
WASHINGTON (AP) — Caught in a sprawling trade dispute with U.S. rival China, President Donald Trump has decided against declaring commercial war on America’s friends. The White House says that he is delaying for six months any decision to slap import taxes on foreign cars, a move that would hit Europe and Japan especially hard. Trump is hoping to use the threat of auto tariffs to pressure Japan and the European Union into making concessions in ongoing trade talks.
The president has dusted off a rarely used weapon in the U.S. trade war arsenal — Section 232 of the Trade Expansion Act of 1962 — to investigate whether auto imports are a threat to U.S. national security, justifying tariffs.
The Alliance of Automobile Manufacturers, which is an industry trade group asserts that “cars are not a national security threat”, adding that “by boosting car prices across the board and driving up car repair and maintenance costs, tariffs are essentially a massive tax on consumers.””
Taxing auto tariffs would mark a major escalation in Trump’s aggressive trade policies. The United States last year imported $192 billion worth of passenger vehicles and $159 billion in auto parts.
Trump says he’ll decide whether to take further action in 180 days.
Trade war, heavy rains weigh on Deere & Co.
UNDATED (AP) _ Deere & Co. cut its expectations for the year as a trade war between the U.S. and China escalates at the same time that farmers are attempting to recover from a planting season besieged by heavy rains. Prices of soybeans targeted by Chinese tariffs last year fell to a 10-year low this week as the countries traded jabs. Deere says farmers have grown more cautious when buying equipment.
Deere now expects to earn about $3.3 billion in 2019, down from its forecast three months ago for profits of about $3.6 billion. The company is less optimistic about revenue as well, lowering its forecast of a 7% increase, to just 5%.
Company shares slumped 6% to a new low for the year.
Despite the $11 billion in relief payments that were doled out last year by the federal government, the personal income of farmers declined by $11.8 billion through the first three months of 2019, according to the U.S. Commerce Department. A similar pace of decline is expected in the coming months, according to the Federal Reserve Bank of Kansas City. And that is hurting Deere.
United Airlines to lay off 100 in Houston, outsource jobs
HOUSTON (AP) _ United Airlines says it will cut about 100 accounting jobs in Houston in July and shift the work to a contractor.
The airline reported the layoffs in a letter this week to the Texas Workforce Commission. It did not identify the contractor that will handle accounting of revenue from passengers.
A United spokeswoman said Friday the airline is providing job-search help. She says about 1,200 workers will remain in the downtown building to perform work in information technology, accounting and government affairs.
United has about 12,000 employees in Houston, including workers based at George Bush Intercontinental Airport.
Chicago-based United is the nation’s third-biggest airline by revenue behind American Airlines and Delta Air Lines. It’s the result of a 2010 merger with Continental Airlines, which was based in Houston.
Luckin, a Starbucks rival in China, jolts higher in US debut
NEW YORK (AP) — Luckin Coffee, a fast-growing rival to Starbucks in China, jolted higher in its U.S. stock market debut Friday.
The Chinese company, which opened its first store in Beijing less than two years ago, has 2,370 locations and plans to surpass the 3,700 stores Starbucks has in China by the end of the year. Unlike Starbucks, most of Luckin’s stores are small, have few seats and are used mainly as a place to pick up mobile orders.
Luckin raised $561 million in its initial public offering Friday by selling 33 million American depositary shares at $17 apiece. The ADS, which is trading on the Nasdaq under the symbol “LK,” shot up 44% to $24.50 Friday midday.
China, Iran foreign ministers meet amid Middle East tensions
BEIJING (AP) _ The foreign ministers of China and Iran have met in Beijing amid heightened Middle East tensions and efforts by Tehran to keep its world markets open.
Saudi Arabia has accused Iran of being behind a drone attack that shut down a key oil pipeline in the kingdom, while, the U.S. has dispatched warships and bombers to the region to counter any alleged Iranian threat.
President Donald Trump decided last year to withdraw the U.S. from the 2015 nuclear accord between Iran and world powers and imposed wide-reaching sanctions that have crippled Iran’s economy.
Cross-party Brexit talks break down in Britain
LONDON (AP) _ Cross-party talks in Britain aimed at striking a compromise Brexit deal have broken down without agreement. The Opposition Labour Party says the talks with Prime Minister Theresa May’s government have gone as far as they can.
The two sides have held weeks of negotiations to see if they can agree on terms for Britain’s exit from the European Union that can actually win support in Parliament. The talks began after lawmakers rejected May’s divorce deal with the EU three times.
But the Conservatives and Labour differ on how close an economic relationship to seek with the bloc after the U.K. leaves.
Britain was due to leave the EU on March 29, but Brexit has been delayed until Oct. 31 amid the political impasse.
EU extends sanctions against Assad’s Syria regime for a year
BRUSSELS (AP) — The European Union is prolonging sanctions against the Syrian regime of President Bashar Assad for another year due to its continued crackdown against civilians in the war-ravaged country. 270 people and 70 companies and organizations will have travel bans and assets frozen until June 1, 2020.
The sanctions are due to alleged violence against civilians, benefiting from or supporting the regime, or being associated with people who do.
The EU has also imposed an oil embargo on Syria and bans equipment that could be used in a crackdown on Syrian civilians.
Test of ‘cannabis cafes’ gets state OK, but obstacles remain
BOSTON (AP) — Massachusetts marijuana regulators have approved of a plan to slowly roll out “cannabis cafes” where adults could use pot in a social setting.
The 3-2 vote by the Cannabis Control Commission on Thursday calls for an initial test program in as many as a dozen communities where licenses would be granted for social consumption establishments. Marijuana use might also be allowed at certain outdoor public events.
The program could not move forward without a change in state law that would give local communities the power to authorize cannabis cafes. Bills are pending in the Legislature to do that.
The commission is recommending stringent rules to prevent people under 21 from entering social consumption sites, and training for employees to recognize when a patron is too high to drive safely.