Volkswagen owners will get a choice: a buyback or repairs
SAN FRANCISCO (AP) — The owners of nearly half a million polluting Volkswagens in the U.S. will have the option of selling them back to the company or getting them repaired at VW’s expense, under a deal announced Thursday by a federal judge.
The tentative agreement, however, left many questions unanswered, including the size of the buyback and timing of the program.
The judge involved with a tangle of litigation for VW did not elaborate and warned attorneys not to talk about the negotiations, saying that it could cause confusion among customers.
Details of the agreement are expected to come out over the next couple of months.
Alphabet spells big gains for investors, despite 1Q letdown
SAN FRANCISCO (AP) — Larry Page’s five-year tenure as CEO of Google — and its newish corporate parent Alphabet — is reminding investors that patience pays off, despite a letdown in the first quarter.
After lagging its peers in the early stages of Page’s reign, the company has since delivered returns that trounced both the Standard & Poor’s 500 and Apple shares. Since Page took the helm in 2011, Alphabet’s stock has soared 163 per cent, creating an additional $300 billion in shareholder wealth.
Some of Alphabet’s gains evaporated late Thursday after the company announced first-quarter earnings and revenue that fell below analyst projections.
Microsoft reports weak results despite turnaround effort
SAN FRANCISCO (AP) — In a sign that Microsoft is still finding its way in the post-PC era, the tech giant reported a surprise drop in quarterly sales and profit.
Despite a series of changes that CEO Satya Nadella has been making in Microsoft’s business, revenue for the most recent quarter fell 6 per cent to $20.5 billion, while profit plunged 25 per cent to $3.76 billion.
The results came in a week when other industry stalwarts reported their own struggles with major changes in the way people use technology.
More Americans are expected to remodel their homes this year
WASHINGTON (AP) — A rising number of Americans are preparing to renovate their homes this year, a potential boost for the economy, according to projections released Thursday by Harvard University’s Joint Center for Housing Studies.
The report estimates that spending on remodeling and repairs will climb 8.6 per cent this year to $310 billion. The gains would bring renovations close to the 2006 peak of an inflation-adjusted $327 billion.
The additional spending would likely contribute to broader economic growth, creating more jobs for construction workers and building supply firms. Driving the increased spending on contractors are rising home sales.
US applications for jobless aid fall to four-decade low
WASHINGTON (AP) — The number of Americans seeking unemployment benefits fell to a four-decade low last week, a sign that employers are unconcerned about weak economic growth in the first three months of 2016.
Weekly applications for jobless benefits declined to a seasonally adjusted 247,000, the lowest reading since November 1973, the Labor Department said Thursday. The four-week average, a less-volatile figure, dropped 4,500 to 260,500. The total number of people receiving benefits has fallen 7.6 per cent from a year ago to 2.14 million.
GM profits more than double on record N. America earnings
DETROIT (AP) — General Motors’ first quarter profit more than doubled as all of its business units posted improved numbers including record pretax earnings in North America.
The Detroit automaker earned $1.95 billion, or $1.24 per share, even after a $500 million cash investment in ride-sharing company Lyft. After paying $60 million to settle stockholder lawsuits over an ignition switch debacle, GM earned $1.26 per share. That soundly beat Wall Street forecasts of $1 per share.
The company also paid $300 million in restructuring costs, mainly for union worker early retirement buyouts in the U.S.
Southwest Airlines 1st quarter helped by lower fuel prices
DALLAS (AP) — Southwest Airlines packed even more people on its planes, notched a record first-quarter profit of $511 million, and said solid bookings have continued into April.
The Dallas carrier topped Wall Street expectations, and Southwest shares rose on Thursday while every other major U.S. airline stock fell.
Southwest has been adding flights and bigger planes, contributing to investor concern about fast growth leading to lower prices. Indeed, Southwest’s average fare dipped 3 per cent to $153.75 each way.
Starbucks profit jumps, but sales fall short of expectations
NEW YORK (AP) — Starbucks said its profit rose 16 per cent during the first three months of the year, helped by positive sales around the world.
Still, the sales growth fell short of Wall Street’s expectations and the company’s stock fell 5 per cent to $57.58 in after-hours trading.
The Seattle-based coffee chain said global comparable sales rose 6 per cent for the period ended March 27. That reflected a 7 per cent increase in its flagship U.S. market, where the company has been trying to sign up more people for its mobile app and push food like breakfast sandwiches and salad boxes.
One-time star in solar energy, SunEdison seeks protection
NEW YORK (AP) — SunEdison, a one-time star in the alternative energy field, filed for bankruptcy protection Thursday after years of rapid-fire acquisitions left the solar company in a desperate cash situation.
Just last week an audit committee reviewing operations at company, based in Maryland Heights, Missouri, found an “overly optimistic culture and its tone at the top.” The committee also said that at SunEdison, “cash forecasting efforts lack sufficient controls and processes.”
“Our decision to initiate a court-supervised restructuring was a difficult but important step to address our immediate liquidity issues,” said CEO Ahmad Chatila, in a company release.
China tells banks to lend to expand steel exports
BEIJING (AP) — Regulators told Chinese banks on Thursday to finance steel exports to help reduce a supply glut in a move that could worsen trade tensions with Europe and the United States.
Beijing faces pressure from the United States and Europe to stop what they complain is a strategy of trying to clear away a backlog of steel by exporting at unfairly low prices. The latest order to finance exports is part of instructions from the Chinese central bank and financial regulators to lenders to support the overhaul of state-owned steel and coal industries.
Egypt’s pound flops on black market amid exchange crackdown
CAIRO (AP) — Egypt’s currency fell to new lows on the black market this week, with traders selling it on Thursday from between 11 and 11.15 Egyptian pounds to the dollar amid speculation it will be officially devalued further.
The pound was last devalued officially from 7.73 to the dollar in mid-March.
Central bank Gov. Tarek Amer has blamed the trend on speculation and rumours by people “seeking to harm the country.” He denied to the state MENA news agency the bank planned a further devaluation.
The Dow Jones industrial average fell 113.75 points, or 0.6 per cent, to 17,982.52. The Standard & Poor’s 500 index lost 10.92 points, or 0.5 per cent, to 2,091.48. The Nasdaq composite index slid 2.24 points, or 0.1 per cent, to 4,945.89.
Benchmark U.S. crude oil fell $1, or 2.3 per cent, to close at $43.18 a barrel in New York after. Brent crude, the international standard, dropped $1.27, or 2.8 per cent, to close at $44.53 a barrel in London. In other energy trading, wholesale gasoline rose about a penny to close at $1.52 a gallon. Heating oil fell 3 cents, or 2.4 per cent, close at $1.30 a gallon. Natural gas was little changed at $2.07 per 1,000 cubic feet.