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Stocks slip at midday
NEW YORK (AP) — Stock indexes are edging lower in midday trading on Wall Street as investors continue to look over corporate earnings reports.
Technology companies rose after chipmaker Nvidia handily beat analysts’ profit forecasts for the fourth quarter. Online travel company Expedia and Sharpie maker also climbed on solid earnings.
Energy and health care companies lagged the market.
Bond prices rose. The yield on the 10-year Treasury fell to 1.58% from 1.61% late Thursday.
US retail sales up a modest 0.3% in January
WASHINGTON (AP) — U.S. retail sales rose a modest 0.3% in January, a slight improvement over December, as unseasonably warm weather boosted sales at hardware stores and furniture stores.
The Commerce Department said Friday that the January advance followed a 0.2% rise in sales in December.
The slight January gain was in line with expectations. However, economists were also expecting to see a solid gain in an underlying control group of retail sales which feeds into the government’s calculations for overall economic growth.
Instead, sales in the control group showed no gain at all in January and the December performance was revised down to show a gain of just 0.2%, slower than the 0.5% rise initially reported.
Economists said the weakness in underlying retail sales was disappointing but likely will be temporary given a number of factors expected to support consumer spending in coming months.
Consumer spending accounts for about two-thirds of economic growth and economists are counting on consumers to remain strong to offset weakness in other areas of the economy such as trade and business investment.
US manufacturing output hit by Boeing troubles, slips 0.1%
WASHINGTON (AP) — U.S. manufacturing output fell slightly in January, driven lower by Boeing's decision to halt production of its troubled 737 MAX aircraft.
The Federal Reserve said Friday that factory output declined 0.1% last month after eking out a 0.1% gain in December. Excluding the production of airplanes and parts, factory production rose 0.3%.
U.S. manufacturing has shown signs of recovering from a year-long downturn but is facing a fresh challenge from Boeing's troubles, which also affect hundreds of suppliers. Manufacturing output is down 0.8% in the past year, hurt by the U.S.-China trade war and slower global growth.
Overall industrial production, which includes output from mines and utilities, dropped 0.3% in January, held back by a 4% drop in utility production because of unseasonably warm weather.
FACEBOOK-PAID POLITICAL MEMES
Facebook reverses on paid influencers after Bloomberg memes
SAN FRANCISCO (AP) — Facebook decided Friday to allow a type of paid political message that had sidestepped many of the social network's rules governing political ads, in a reversal that highlights difficulties tech companies and regulators have in keeping up with the changing nature of paid political messages.
Its policy change comes days after Democratic presidential candidate Mike Bloomberg exploited a loophole to run humorous messages promoting his campaign on the accounts of popular Instagram personalities followed by millions of younger people.
Bloomberg's effort skirted many of the rules that tech companies have imposed on political ads to safeguard U.S. elections from malicious foreign and domestic interference and misinformation. Online political ads have been controversial, especially after it was revealed Russia used them in an attempt to influence the 2016 presidential election. In response, Facebook has rolled out a number of rules to prevent a repeat of that, though it has declined to fact-check political ads and refuses to ban even blatently false messages.
Before the explosion of social media, it was clearer what's an ad and what isn't — and thus what's subject to disclosures and other rules. With social media, a campaign can pay celebrities and other influential users to spread a message on their behalf, without ever buying an ad and be subject to its rules.
Pelosi urges countries to steer clear of Huawei for 5G
MUNICH (AP) — House Speaker Nancy Pelosi has appealed to an audience in Germany for countries to steer clear of Chinese tech giant Huawei (WAH'-way) as they build their next-generation cellular networks, adding her voice to pressure from the Trump administration.
Pelosi said during an appearance Friday at the Munich Security Conference that “nations cannot cede our telecommunication infrastructure to China for financial expediency.” She said that would be an “ill-conceived concession” that would embolden Chinese President Xi Jinping (shee jihn-peeng).
Pelosi said Chinese domination of 5G "would be to choose autocracy over democracy."
Her remarks underlined bipartisan suspicion of Huawei in the United States. The Trump administration is aggressively lobbying Western allies to bar the company from wireless, high-speed networks.
Zuckerberg accepts that Facebook may have to pay more tax
LONDON (AP) — Facebook CEO Mark Zuckerberg plans to throw his support behind international reforms that would require Silicon Valley tech giants to pay more tax in Europe.
The billionaire social network founder is due to meet members of the European Union's executive Commission in Brussels and speak at the Munich Security Conference in Germany.
Zuckerberg is expected to tell the conference on Saturday that he's backing plans for digital tax reform on a global scale proposed by the Organisation for Economic Cooperation and Development. According to an excerpt of his speech provided in advance, Zuckerberg will say, “I understand that there’s frustration about how tech companies are taxed in Europe."
The OECD plans would require digital and internet companies, including social media platforms, to pay more tax in countries where they have significant consumer-facing activities and generate profits.
Tech companies have faced criticism for not paying enough tax in some countries.
Tesla prices its second offering of stock at $767 apiece
PALO ALTO, Calif. (AP) — Tesla priced its second offering of stock at $767 apiece Friday.
An announcement Thursday that Tesla would put an additional $2 billion worth of stock on the market surprised almost everyone. Just two weeks ago, CEO Elon Musk said the company had enough cash to fund its capital programs and that it didn't need to raise any more money.
But Tesla is taking advantage of seemingly insatiable demand for its stock. Tesla shares have almost doubled since the start of the year, and it's quadrupled since June.
That demand continued to surge Thursday, even though issuing additional company shares can dilute the value of those already on the market. Shares closed up another 5%.
Volkswagen offers diesel settlement in Germany
UNDATED (AP) — Automaker Volkswagen has offered 830 million euros as a settlement for owners of diesel vehicles that used software to mask excessive emissions.
The company said Friday it was making the offer after talks broke down with a German consumer association that had been negotiating for a deal over fees for the plaintiffs' attorneys. It said its offer reflected what had already been negotiated.
The VZBZ consumer association said that the settlement talks failed because Volkswagen was unwilling to set up what it called a “transparent, trustworthy and secure” way of resolving the claims.
In 2015, U.S. regulators caught Volkswagen using software that turned emissions controls off once the car had passed emissions tests. The company has paid out more than 30 billion euros ($33 billion) in fines, settlements and recalls.
MEDICAID WORK REQUIREMENTS
US appeals panel upholds block of Medicaid work requirements
LITTLE ROCK, Ark. (AP) — A federal appeals court panel in Washington has upheld a lower court's decision that blocked the Trump administration's work requirements for Medicaid recipients.
Friday's decision from a three-judge panel of the U.S. Court of Appeals in Washington, D.C., found Arkansas' work requirements for Medicaid recipients to be “arbitrary and capricious.”
The Trump administration has allowed states to require able-bodied adults drawing Medicaid benefits to work, volunteer or study. Officials argue that work can make people healthier. Nearly 20 states are in various stages of trying to implement work requirements.
BORDER PATROL-BUS CHECKS
AP Exclusive: Agency memo contradicts Greyhound on bus raids
SEATTLE (AP) — A Customs and Border Protection memo obtained by The Associated Press confirms that bus companies such as Greyhound do not have to allow Border Patrol agents on board to conduct routine checks for illegal immigrants, which is contrary to the company's long insistence that it has no choice but to do so.
Greyhound, the nation's largest bus carrier, has faced pressure from the American Civil Liberties Union, immigrant rights activists and Washington state Attorney General Bob Ferguson to stop allowing sweeps on buses within 100 miles of an international border or coastline.
They say the practice is intimidating and discriminatory and has become more common under President Donald Trump. Border Patrol arrests videotaped by other passengers have sparked criticism, and Greyhound faces a lawsuit in California alleging that it violated consumer protection laws by facilitating raids.
The memo obtained by the AP was dated Jan. 28, addressed to all chief patrol agents and signed by then-Border Patrol Chief Carla Provost just before she retired. It confirms the legal position that Greyhound's critics have taken: that the Constitution's Fourth Amendment prevents agents from boarding buses and questioning passengers without a warrant or the consent of the company.
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