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Business Highlights

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Pressure grows on Volkswagen as bad news piles up

FRANKFURT, Germany (AP) — The fallout from Volkswagen’s emissions-cheating scandal intensified Wednesday, as investors bailed out and European regulators pressured VW to quickly disclose the findings of an internal investigation. In the U.S., the company halted sales of seven models that allegedly were part of the cheating.

This follow’s VW admission on Tuesday that it had understated the carbon dioxide emissions for 800,000 cars, widening the scope of a scandal.

The company has been unable halt the flow of bad news since mid-September, when the U.S. Environmental Protection Agency said Volkswagen had installed software on 482,000 cars that enabled them to cheat on emissions tests.

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Yellen: December interest rate hike a “live possibility”

WASHINGTON (AP) — Federal Reserve Chair Janet Yellen said Wednesday that an interest rate hike in December is a “live possibility” if the economy stays on track.

Yellen described the U.S. economy as “performing well” right now, with solid growth in domestic spending.

A decision has not been made but at its Dec. 15-16 meeting, the Fed will consider raising a key interest rate from a record low near zero if the economy continues to grow at a strong enough pace to keep adding jobs and push annual inflation toward the Fed’s 2 per cent target.

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Kraft Heinz to close 7 factories in US, Canada in downsizing

IOWA CITY, Iowa (AP) — Kraft Heinz will close seven plants in the U.S. and Canada as part of a downsizing that will eliminate 2,600 jobs, or roughly 14 per cent of its North American factory workforce, the food company announced Wednesday.

The company said the reduction, which will take place over the next two years, is part of a plan to save $1.5 billion in operating costs by the end of 2017. The plants slated for closure are in California, Maryland, New York, Pennsylvania, Wisconsin and Ontario.

Among the hardest hit cities will be Madison, Wisconsin, where a nearly century-old Oscar Mayer plant that employs 700 production workers will close. Kraft Heinz also said it would move about 250 corporate jobs from Madison to Chicago, the company’s co-headquarters along with Pittsburgh.

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How myRA, a new retirement account, works

NEW YORK (AP) — A government-backed individual retirement account announced nearly two years ago by President Barack Obama is now available across the country, the Treasury Department said Wednesday, and it removes several barriers that keep millions of people from saving for their retirement.

The account, called a myRA, has no fees, no minimum balance, no risk of losing money and it doesn’t have to be linked to an employer.

MyRAs are aimed at those without access to employer-sponsored retirement plans like 401(k)s, but anyone under certain income levels is eligible.

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Japan Post companies net $12B in biggest IPO this year, shares soar

TOKYO (AP) — Shares of Japan Post surged nearly 26 per cent in their trading debut Wednesday after the company and its banking and insurance units raised a combined 1.44 trillion yen ($11.9 billion) in the world’s biggest initial public offering this year.

The long awaited sale of shares in the state-owned company was the biggest since Chinese e-commerce giant Alibaba Group Holdings raised $25 billion in its IPO in September 2014.

The Japan Post sale is meant to tease out some of the more than $14 trillion that Japanese have squirreled away in savings accounts. Some IPO funds will help pay for rebuilding from the 2011 tsunami disaster.

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Lumber Liquidators names new CEO, continues sales struggle

NEW YORK (AP) — Lumber Liquidators Holdings Inc. named a new CEO as it continues to struggle with sales in the wake of allegations that imported Chinese-made laminate flooring contained high levels of the carcinogen formaldehyde.

The Toano, Virginia-based company suspended the sale of all such products made in China this spring, but the CEO Robert Lynch resigned in May. He was replaced temporarily by the company’s founder, Thomas D. Sullivan, as acting CEO.

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As Facebook grows, look for more ads on Instagram

SAN FRANCISCO (AP) — Facebook, the world’s largest social network, has steadily built its advertising business to become the world’s second-largest digital ad platform. Now it’s looking at ways to make more money from newer services like Instagram, the mobile photo-sharing app that it bought in 2012.

The company doesn’t disclose how much of its revenue comes from Instagram. Facebook beat Wall Street estimates on Wednesday by reporting third-quarter net income of $891 million, on revenue of $4.5 billion. Profit was up 11 per cent, while revenue grew 40 per cent from the same period a year earlier.

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More states wade into legal fight on greenhouse gases

WASHINGTON (AP) — A coalition of 18 states is seeking to defend President Barack Obama’s plan to slow climate change by reducing greenhouse gas emissions.

They are opposing lawsuits filed last month against the U.S. Environmental Protection Agency by 25 mostly Republican states and allied industry groups. Those states, led by Texas and West Virginia, deride the carbon-cutting Clean Power Plan as an “unlawful power grab by Washington bureaucrats” that will kill coal-mining jobs and drive up electricity costs.

The group that filed a joint motion to intervene on Wednesday in favour of Obama’s plan largely includes states, big cities and urban counties led by Democrats. They include New York, California, Massachusetts and Virginia.

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US trade deficit narrowed to $40.8 billion in September

WASHINGTON (AP) — The U.S. trade deficit declined in September to the lowest level in seven months as exports rebounded while imports shrank, reflecting the smallest monthly foreign oil bill in more than a decade.

The trade deficit narrowed to $40.8 billion in September, down 15 per cent from a $48 billion deficit in August, the Commerce Department reported Wednesday. Exports rose 1.6 per cent to $187.9 billion, helped by stronger sales of commercial airplanes and jet engines. Imports contracted 1.8 per cent to $228.7 billion.

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Time Warner CEO signals delays for DC shows on Netflix, Hulu

LOS ANGELES (AP) — Fans of superhero shows based in the DC Comics universe like “The Flash,” ”Arrow” and “Gotham” might have to wait a lot longer for past seasons’ episodes to come to Netflix and Hulu.

Jeff Bewkes, the chief executive of DC-owner Time Warner Inc., told analysts on a conference call Wednesday that the company is considering whether to let online services like Netflix have those shows several years after they first air, rather than one year later. He said that could mean more older episodes are available on-demand to traditional cable customers.

Withdrawing those shows from online services would make traditional cable and satellite TV packages more attractive.

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The Dow Jones industrial average fell 50.57 points, or 0.3 per cent, to close at 17,867.58. The Standard & Poor’s 500 index fell 7.48 points, or 0.4 per cent, to 2,102.31. The Nasdaq composite fell 2.65 points, or 0.1 per cent, to 5,142.48.

Crude oil fell $1.58, or 3.3 per cent, to $46.32 a barrel. Brent crude, which is used to price international oils, fell $1.96, or 4 per cent, to $48.58 a barrel.

In other trading, wholesale gasoline fell 5.4 cents to $1.392 a gallon in New York. Heating oil fell 6.3 cents to $1.504 a gallon and natural gas rose 0.9 cent to $2.262 per 1,000 cubic feet.