fb-pixel Skip to main content

American Airlines stock drops, pulling down other airlines, on weaker earnings


American Airlines stock drops, pulling down other airlines, on weaker earnings

American Airlines Group stock tumbled more than 4 percent and pulled other carriers in its wake after saying 2018 earnings could fall short of its forecast because domestic fares were weaker than expected. Adjusted earnings will be $4.40 to $4.60 a share, the carrier said Thursday in a regulatory filing. American had forecast profit of as much as $5, and analysts had anticipated $4.62. The update compounded a bleak outlook for US carriers as economic uncertainty threatens global demand. Delta Air Lines Inc. recently trimmed its forecast for a key gauge of pricing power and set the stage for a gloomy earnings season, which kicks off next week for the major carriers. — BLOOMBERG NEWS



Audit finds program designed for young workers hired a 62-year-old

A New York state audit has found lapses at a program that rewards employers who hire young workers — including a 62-year-old who was deemed eligible for the program. The review, published Thursday by Comptroller Thomas DiNapoli, found several problems in the state-run program, including nearly $200,000 in questionable tax credits. Some of the companies that received the credits hired employees who were too old for the program, while others didn’t adequately verify their employee’s eligibility. The jobs program, started in 2011, encourages employers to hire at-risk youth ages 16 to 24 by awarding tax credits of up to $500 for a full-time worker. — ASSOCIATED PRESS


US supplier of T-shirts, team apparel cuts ties to Chinese company over forced labor

A United States supplier of T-shirts and other team apparel to college bookstores cut its ties Wednesday with a Chinese company that drew workers from an internment camp holding targeted members of ethnic minority groups. In recent years, authorities in the far west Chinese region of Xinjiang have detained an estimated 1 million Uighurs and Kazakhs in heavily-secured facilities where detainees say they are ordered to renounce their language and religion while pledging loyalty to the China’s ruling Communist Party. Last month an Associated Press investigation found the Chinese government had also started forcing some detainees to work in manufacturing and food industries. The investigation tracked recent shipments from one such factory, the privately owned Hetian Taida Apparel, located inside an internment camp, to Badger Sportswear, a leading supplier in Statesville, N.C.



Rates fall to lowest level in nine months

Long-term mortgage rates continued to fall this week, reaching their lowest levels in nine months. The decline in home borrowing rates in recent weeks has been a spur to prospective home buyers, reflected in a spike in applications for mortgages. Mortgage buyer Freddie Mac says the average rate on the benchmark 30-year, fixed-rate mortgage dipped to 4.45 percent this week from 4.51 percent last week. Rates remain far above last year’s levels, however. The key 30-year rate averaged 3.99 percent a year ago. The average rate for 15-year fixed-rate loans fell to 3.89 percent from 3.99 percent last week. — ASSOCIATED PRESS


Shaheen, Hassan file legislation to block drug companies from ad expense deductions

Senator Jeanne Shaheen, a New Hampshire Democrat, has introduced a bill that would prohibit pharmaceutical companies from claiming tax deductions for consumer advertising expenses. Under current law, drug manufacturers are allowed to deduct the cost of advertising expenses from federal taxes. A news release from Shaheen’s office Thursday said those advertising expenses have more than quadrupled over the past two decades, rising from $1.3 billion in 1997 to $6 billion in 2016. Shaheen said the aggressive advertising also increases demand and allows drug companies to increase prices. She said taxpayers shouldn’t be subsidizing the ads. The bill is cosponsored by fellow Democratic Senator Maggie Hassan. — ASSOCIATED PRESS



Google wins a round in European ‘right to be forgotten’ case

Google shouldn’t have to apply the so-called right to be forgotten globally, an adviser to the EU’s top court said in a boost for the US giant’s fight with a French privacy regulator over where to draw the line between privacy and freedom of speech. While backing Google’s stance, Advocate General Maciej Szpunar of the EU Court of Justice said that search engine operators must take every measure available to remove access to links to outdated or irrelevant information about a person on request. The Luxembourg-based court follows such advice in a majority of its final rulings, which normally come a few months after the opinions. Google has been fighting efforts led by France’s privacy watchdog to globalize the right to be forgotten, which was created by the EU court in a landmark ruling in 2014, without defining how, when, and where search engine operators should remove links. This has triggered a wave of legal challenges. — BLOOMBERG NEWS


Google shareholder sues over large payouts to sexual harassers

A Google shareholder sued the company’s board of directors and senior management on Thursday, arguing that the tech giant’s leaders breached their duty to investors when they covered up sexual misconduct by executives and gave harassers large payouts. The suit, by shareholder James Martin, stems from revelations last year that the company awarded a $90 million exit package to executive Andy Rubin, the creator of the Android operating system, even as Rubin was being pushed out over sexual misconduct. Google had asked for Rubin’s resignation in 2014 after determining that allegations that he had coerced a woman into performing oral sex in a hotel room the previous year were credible. Rubin was celebrated when he left Google, and the real reason for his departure was made public by the Information and New York Times, which also reported the payout. Rubin has denied the allegations. — WASHINGTON POST



Group funded by Coca-Cola undermines Chinese fight against obesity, research finds

China’s efforts to keep obesity in check have been undermined from the inside by the food industry, according to newly published research. A scholar of Chinese society at Harvard University traced how a group funded by Coca-Cola and other food companies enjoyed close ties to Chinese health officials. The group helped tilt the country’s obesity fight with the message that exercise matters more than dietary habits, which health advocates say is a way to deflect attention from food’s role in fueling obesity. The International Life Sciences Institute was created in 1978 by a former Coke executive and has 17 branches around the world. In China, its small but influential branch organized obesity conferences focusing on physical activity, with speakers including Coke-funded researchers and a Coke executive, according to the papers published in The BMJ and The Journal of Public Health Policy. — ASSOCIATED PRESS