Business Highlights

AP News
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Posted: Jul 21, 2016 6:34 PM

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Roger Ailes is out as head of Fox News, Fox Business

NEW YORK (AP) — Roger Ailes is out as chief executive at Fox News Channel, his career at the network he built from scratch and ran with an iron hand for nearly 20 years over with stunning swiftness following allegations that he forced out a former anchor after she spurned his sexual advances.

Network parent 21st Century Fox said that Rupert Murdoch, the company's executive chairman, would run Fox News and its sister Fox Business Network, which Ailes had also led, until a successor could be found.

Murdoch and 21st Century Fox and Murdoch did not address the widening scandal in the statement on the resignation but lauded Ailes for his contributions. Ailes did not comment in the statement, and no details were given on a settlement agreement.

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Still-low mortgage rates ushering new refi wave

Mortgage interest rates have remained low for so long, lenders and borrowers alike have been expecting rates would only creep higher. Instead, they've tested record lows.

That's prompting a flurry of purchases and refinancings as consumers rush to take advantage. Mortgage borrowing has jumped to the highest level in three years, according to quarterly data provided by the Mortgage Bankers Association. Refinancing applications have posted big increases this month.

These rates can mean big savings, but there's a catch: First, you have to qualify. Bad credit and insufficient home equity remain hurdles to refinancing.

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Chipotle out of character in struggle to win back customers

NEW YORK (AP) — Chipotle's struggle to win back customers could be a long one.

The company said Thursday its sales were down 23.6 percent during the second quarter as it fights to recover from a series of food scares. That follows a 30 percent drop at established locations in the first three months of the year, when Chipotle posted its first quarterly loss as a public company.

Chipotle's profit fell to $25.6 million, or 87 cents per share for the second quarter. A year ago, the company earned $140.2 million, or $4.45 per share.

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US unemployment applications dip to 253,000 last week

WASHINGTON (AP) — The number of Americans seeking unemployment benefits declined slightly last week, falling to the lowest point in 13 weeks.

The Labor Department said Thursday that weekly benefit applications dipped to 253,000, the lowest level since it stood at 248,000 for the week of April 16.

Weekly claims, which are a proxy for layoffs, have been below 300,000 for 72 consecutive weeks, the longest stretch since 1973. The less volatile four-week average declined to 257,750, down from 259,000 the previous week.

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US homes sales improved in June, best pace since early 2007

WASHINGTON (AP) — Americans bought more homes in June, the fourth straight monthly gain as the sales rate reached its highest level in more than nine years.

The National Association of Realtors said Thursday that sales of existing homes rose 1.1 percent last month to a seasonally adjusted annual rate of 5.57 million.

Buyers are quickly making offers amid tight supplies of homes on the market, boosting prices as the traditional buying season reached its crescendo. The solid job market and mortgage rates near historic lows have kept demand steady, even though the number of listings on the market has dropped.

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General Motors 2Q profit more than doubles on US earnings

DETROIT (AP) — General Motors' second-quarter profit more than doubled to a post-bankruptcy record $2.87 billion on a strong performance in the U.S. and it raised its earnings guidance for the year.

The company earned a record $3.6 billion pretax profit in North America, made $500 million on its joint venture in China and even eked out a $137 million profit in Europe, its first five years. But it lost money in South America due to economic woes and profits were nearly halved in international operations due to struggles in the Middle East.

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Southwest shares fall after airline cites weak revenue trend

DALLAS (AP) — Southwest Airlines' second-quarter profit jumped 35 percent to $820 million thanks to record revenue and cheaper fuel. But the profit was short of market forecast and the airline predicted Thursday that a key revenue figure will turn down in the July-through-September quarter. That suggests that lower average fares are hurting even the original low-fare carrier.

Southwest shares plunged in trading, wiping out gains from a three-week rally in the stock.

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Union Pacific 2Q profit falls 19 percent as volume slows

OMAHA, Neb. (AP) — Union Pacific's second-quarter profit fell 19 percent as the railroad hauled 11 percent less freight.

The railroad said Thursday that full-year volumes are likely to fall 6 percent to 8 percent because of the soft global economy, strong U.S. dollar and weak consumer demand.

The Omaha, Nebraska-based company reported net income of $979 million, or $1.17 per share. That's down from $1.2 billion, or $1.38 per share, a year ago. Revenue declined 12 percent to $4.77 billion.

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Starbucks cuts sales forecast after growth slows

NEW YORK (AP) — Starbucks trimmed its sales forecast Thursday after revenue came in lighter than expected in the most recent quarter.

The Seattle-based company said global sales rose 4 percent at established locations, including in its flagship U.S. market, for its fiscal third quarter. It now expects the figure to increase in the mid-single digit percentages for the year. It previously forecast growth to be "somewhat above" that range.

It comes after the coffee chain revamped its rewards program in April, which some had speculated might drive away some customers.

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Visa earnings fall due to costs tied to Visa Europe purchase

NEW YORK (AP) — Visa Inc. said its fiscal third-quarter earnings fell 76 percent, largely due to the cost of completing its purchase of its operations in Europe.

The credit and debit card processor said it earned a profit of $412 million, or 17 cents per share, down from $1.7 billion, or 69 cents per share, a year ago. The results included several one-time items, but the largest one was a $1.9 billion charge related to the ending of a framework agreement between Visa and Visa Europe.

Excluding those one-time charges, Visa earned 69 cents per share, 2 cents above market forecasts.

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McDonald's joins "Pokemon Go" craze hoping to catch the wave

NEW YORK (AP) — McDonald's will become the first major corporation to collaborate with the makers with the wildly popular "Pokemon Go."

The fast food chain will partner with the developer Niantic in Japan where, to the frustration of legions of would-be players, the game has yet to launch. Details of the collaboration were not released.

Small businesses like bars and stores have bought "lures" and "incense," objects in the game that attract Pokémon creatures and, more importantly, players. But no company has officially partnered with Niantic before now.

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The Dow Jones industrial average fell 77.80, or 0.4 percent, to 18,517.23. The Standard & Poor's 500 index lost 7.85 points, or 0.4 percent, to 2,165.17. The Nasdaq sank 16.03 points, or 0.3 percent, to 5,073.90.

U.S. crude sank $1 to settle at $44.75 per barrel. Brent fell 97 cents to $46.20 a barrel in London. Wholesale gasoline fell 1 cent to $1.36 a gallon, heating oil fell 3 cents to $1.37 a gallon and natural gas rose 3 cents to $2.69 per 1,000 cubic feet.