Update on the latest business

December 07, 2017 - 1:04 pm

FINANCIAL MARKETS

Stocks gain

NEW YORK (AP) — Stocks are higher in midday trading on Wall Street, putting the Standard & Poor's 500 index on track for its first gain in five days.

Technology, industrial stocks and banks are up more than the rest of the market. Facebook, Boeing and Wells Fargo all climbed almost 2 percent.

Crude oil and energy stocks clawed back some of their sharp losses from Wednesday. So did Asian stock markets.

MORTGAGE RATES

US mortgage rates rise, though remain historically low

WASHINGTON (AP) — U.S. mortgage rates rose this week as the economy showed signs of strength, which makes it more likely that the Federal Reserve will raise its short-term rate next week.

The rate on the benchmark 30-year fixed-rate mortgage rose to 3.94 percent from 3.9 percent last week, mortgage giant Freddie Mac said. The 15-year, fixed-rate mortgage, popular among homeowners seeking to refinance, also increased, rising to 3.36 percent from 3.3 percent.

The five-year adjustable mortgage rate rose for the third straight week to 3.35 percent, from 3.32 percent last week.

Shorter-term rates are rising more quickly than longer-term debt, and the gap between the 30-year mortgage and five-year has narrowed since the summer. As a result, more homebuyers are choosing the longer-term fixed rate, Freddie Mac says.

UNEMPLOYMENT BENEFITS

Applications for US jobless benefits drop again to 236,000

WASHINGTON (AP) — The number of unemployed workers filing for jobless benefits fell by 2,000 last week to 236,000, the lowest level in five weeks and further evidence of the strength in the labor market.

The Labor Department says last week's total was the third consecutive weekly drop. The four-week average, a less volatile measure, declined 750 to 241,500.

The number of people receiving aid fell by 52,000 to 1.91 million, remaining near a four-decade low set last month.

Applications for unemployment benefits are a proxy for layoffs. The weekly number has been below 300,000 for close to three years, a stretch not seen in more than four decades. The government will release the November unemployment figure on Friday and private economists believe that figure will show unemployment remaining at 4.1 percent.

GE-JOB CUTS

GE's power division plans to cut about 12,000 jobs globally

BOSTON (AP) — General Electric Co. will cut 12,000 jobs in its power division as alternative energy supplants demand for coal and other fossil fuels.

The company said Thursday that the cuts to both office and production jobs, will help "right-size" GE Power, as traditional power markets, and volume of the fuels that power them, decline.

The company says reducing the number of positions will trim costs by $1 billion at GE Power in 2018.

Last month GE announced that it was slashing its dividend in half and that the conglomerate would narrow its focus to three key sectors — aviation, health care and energy. The company has said it will shed assets worth more than $20 billion in the next couple of years. It's been paring businesses for over a decade now.

PIPELINE AGENCY

Pipeline agency at full strength as energy decision looms

WASHINGTON (AP) — President Donald Trump's choice to lead the federal agency that oversees the nation's power grid and natural gas pipelines has been sworn in to office.

Longtime energy lawyer Kevin McIntyre was confirmed last month as chairman of the Federal Energy Regulatory Commission. His installation Thursday brings the commission to a full five members.

The commission was without a quorum for much of the year and unable to make decisions on interstate pipelines and other projects worth billions of dollars.

McIntyre arrives as the commission considers a Trump administration plan to bolster struggling nuclear and coal-fired power plants.

The plan by Energy Secretary Rick Perry would reward nuclear and coal-fired power plants for adding reliability to the nation's power grid.

Action by FERC is expected next week.

NET WORTH

Strong stock market lifts US wealth to $96.9 trillion

WASHINGTON (AP) — Surging stock prices and steady increases in home values powered American household wealth to $96.9 trillion this fall, though the gains likely aren't widely shared.

The Federal Reserve says that U.S. net worth rose $1.7 trillion in the July-September quarter, extending a steady upward march in American wealth after the Great Recession eliminated about one-sixth of it in 2008 and 2009.

The value of Americans' stock portfolios rose $1.1 trillion and real estate values climbed $400 billion. Total household wealth includes checking and savings accounts, and subtracts mortgages and other debt.

The figures come as Congress is considering a tax cut plan that would reduce taxes on corporations and mostly benefit wealthy taxpayers.

The Fed's data show that U.S. corporations currently have a hefty $2.4 trillion in cash.

BROWN-NO MORE STUDENT LOANS

Brown to replace loans with scholarships in aid packages

PROVIDENCE, R.I. (AP) — Brown University says it will replace all student loans with scholarships in its financial aid packages starting next year.

The Ivy League school announced Thursday that by raising $30 million it can now eliminate institutional loans for all returning and incoming undergraduate students.

Brown President Christina Paxson says it amplifies the university's commitment to attract the "best and brightest students" regardless of background.

The move is aimed at families with moderate incomes who don't qualify for larger financial-aid packages given to low-income students.

It follows other steps to make Brown more accessible, including a 2003 admissions rule that forbids the school from considering an applicant's ability to pay tuition.

Brown started raising money to end loans in September and says it needs $90 million more to sustain the program.

GLOBAL BANKS

Years after Lehman: final rules set on strengthening banks

FRANKFURT, Germany (AP) — A global forum of banking regulators has completed a set of rules aimed at keeping weak banks from needing taxpayer bailouts and hurting the economy.

The oversight board of the Basel Committee on Banking Supervision agreed on the last batch of rules at a meeting in Frankfurt, Germany. They set limits on how far banks can diverge from regulatory requirements to keep financial buffers against losses.

Under the rules, the banks are limited in how far they can diverge from regulators' assessment of how risky their holdings are.

European Central Bank head Mario Draghi, who heads the Basel Committee's oversight board, said Thursday that the step was "a major milestone that will make the capital framework more robust."

FORD-ALIBABA-PARTNERSHIP

Ford collaborates with Alibaba as it expands into China

NEW YORK (AP) — Ford is collaborating with Chinese e-commerce giant Alibaba Group to further expand into the world's largest auto market.

The carmaker said Thursday that it's signed a three-year agreement to explore technology for marketing, sales, cloud computing, and distribution strategies. It hopes to better incorporate digital technologies and platforms into its vehicles.

Alibaba in China is what Amazon.com is to Americans.

Ford is a relatively small player in China and has been focusing on expanding into the market to better compete globally. It recently promised to roll out more than 50 new vehicles in China over the next eight years including 15 powered by electricity.

PGA TOUR-CHINA

PGA Tour signs deal to partner Chinese firm Shankai

BEIJING (AP) — The PGA Tour has signed a deal to partner with Chinese firm Shankai Sports to manage the operations of its China series for 20 years from 2018.

Shankai, a Beijing-based firm, says its new venture is receiving a 300 million yuan ($45 million) investment from Yao Capital, a private equity firm co-founded by former Houston Rockets player Yao Ming, and U.S.-based IDG Capital.

After a one-year hiatus, the PGA Tour China Series will resume next year.

The move comes as China has cracked down on golf in recent years, with authorities closing more than 100 courses in an effort to conserve water and land.

Greg Gilligan, PGA Tour's Greater China managing director, says the closures were related to code violations and that China is supportive of the sport.

CHINA-LEGO LAWSUIT

Lego wins first China copyright case against imitators

HONG KONG (AP) — Danish toy maker Lego says it has won a major legal victory in China, where a court ruled in its favor in a copyright case against companies making knockoffs of its famous colored bricks.

The company said Thursday that it was the first time it has won an unfair competition case against imitators in China.

It said the Shantou Intermediate People's Court ruled that two Chinese companies selling Bela brand blocks similar to the Lego Friends line infringed a copyright and ordered them to stop.

The court issued its ruling in September but the decision didn't take effect until November.

Earlier this year, a Beijing court ruled that Lego's name and logo are well-known trademarks in China, giving the company stronger legal footing for pursuing copyright cases.

SPORTS BETTING-MARKET SCRAMBLE

Internet betting firms settle suits over NYX acquisition

ATLANTIC CITY, N.J. (AP) — Three gambling companies have agreed to end their legal battle over the proposed acquisition of NYX Gaming by Scientific Games.

The Las Vegas-based firms hope to join forces and become a leader in the as-yet unapproved U.S. sports betting market.

But William Hill, a rival based in London, had threatened to derail the deal by using stock it owns in NYX.

On Thursday, the companies said they will end their complicated international litigation, adding that William Hill will now support the deal.

The companies anticipate the Supreme Court will legalize sports betting, creating a huge new market in the U.S.

The case was heard on Monday, but a decision may take until June.

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