Business Highlights

AP News
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Posted: Jul 24, 2015 6:24 PM

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Mega-health deals bloom in July, Anthem bids $48B for Cigna

NEW YORK (AP) — Anthem is buying rival Cigna for $48 billion in a deal that would create the nation's largest health insurer by enrollment, covering about 53 million U.S patients.

In just three weeks, starting with Aetna's $35 billion bid for Humana Inc. on July 3, the landscape of U.S. health care has been altered in a buyout frenzy that could transform five massive U.S. health companies into just three, including UnitedHealth Group.

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Can US housing industry's comeback endure? The outlook dims

WASHINGTON (AP) — The U.S. housing market has sizzled this summer, lifting expectations that home sales will finally help drive an economic expansion now in its seventh year.

Or will it?

Signs are emerging that housing's momentum may be destined to falter in coming months. Analysts note that some of the key foundations needed to sustain a brisk pace of home-buying in the long run appear to be missing.

The U.S. economy had only just begun to derive strength from housing for the first time since the Great Recession began in 2007. If home sales flag, that strength would fizzle.

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AT&T buys DirecTV, now biggest traditional TV provider in US

NEW YORK (AP) — Even as TV watchers increasingly go online, AT&T has become the country's biggest traditional TV provider with its $48.5 billion purchase of DirecTV.

It got its regulatory approval Friday from the Federal Communications Commission after more than a year. The Justice Department had already cleared the deal on Tuesday.

AT&T Inc. now has 26.4 million cable and satellite TV subscribers.

That's more than Comcast as well as a bigger Charter, which is seeking government approval to buy Time Warner Cable.

Suppliers of TV are buying one another as video from Internet competitors like Netflix gets more popular and costs rise for channels.

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Fiat Chrysler recalls 1.4M vehicles to prevent hacking

DETROIT (AP) — Fiat Chrysler has decided to recall about 1.4 million cars and trucks in the U.S. just days after two hackers revealed that they took control of a Jeep Cherokee SUV over the Internet.

The company also disclosed in government documents that the hackers got into the Jeep through an electronic opening in the radio and said it would update software to close it. On Thursday, Fiat Chrysler sealed off a loophole in its internal cellular telephone network with vehicles to prevent similar attacks, the automaker said in a statement.

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Could Twitter stop the next terrorist attack?

WASHINGTON (AP) — Social media giants including Twitter, Yahoo, Facebook and Google are pushing back against Senate legislation that would require them to alert federal authorities of any terrorist activity, according to industry and government officials.

In private meetings on Capitol Hill, industry officials have told lawmakers and congressional staff that they already ban grisly content like beheadings and alert law enforcement if they suspect someone might get hurt, as soon as they are aware of a threat.

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Amazon's value surpasses Wal-Mart after surprise 2Q profit

NEW YORK (AP) — It's official: Amazon is bigger than Wal-Mart.

Amazon shares surged almost 10 percent on Friday after the e-commerce powerhouse reported a surprise second-quarter profit and a better-than-expected 20 percent jump in revenue.

The sharp increase in shares brought Amazon's market value to $247.77 billion, more than its biggest rival, Wal-Mart Stores Inc., signaling a sea change in retailing. Amazon, which just turned 20, is now valued higher than the world's largest retailer.

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US new-home sales hit June slump

WASHINGTON (AP) — Fewer Americans bought new homes in June, a possible sign that the real estate market might not be as hot as it appeared at the start of summer.

The Commerce Department said Friday that new-home sales slumped 6.8 percent last month to a seasonally adjusted annual rate of 482,000. The report also revised May sales down to a rate of 517,000 from 546,000.

The June slowdown indicates the potential limits of the earlier momentum. A nearly two-year hiring streak and low mortgage rates had been spurring stronger sales through much of the year. New-home purchases have vaulted up 21.2 percent through the first half of 2015, although the government sales report is volatile on a monthly basis.

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Trade deals wipes out tariffs on more than 200 tech products

WASHINGTON (AP) — Dozens of countries have agreed to abolish duties on more than 200 technology products — from advanced computer chips to GPS devices, printer cartridges and video-game consoles.

The agreement announced Friday marks the World Trade Organization's first tariff-killing deal in 18 years.

The deal is an expansion of the 1997 Information Technology Agreement.

American companies sell $100 billion a year in products covered by the deal. U.S. Trade Rep. Michael Froman called the agreement "great news for the American works and businesses that design manufacture and export state-of-the-art technology and information products."

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American Airlines beats 2Q profit forecasts

FORT WORTH, Texas (AP) — Dramatically cheaper jet fuel helped American Airlines nearly double its second-quarter profit to $1.7 billion despite lower revenue.

The world's biggest airline said Friday that it was American's most profitable quarter ever, after excluding one-time costs and gains.

Friday's results from American capped an astonishing earnings season for the nation's biggest airlines, several of which reported record profits in the April-through-June period.

Still, American warned that a key revenue figure will decline in the third quarter, and the stock closed down 7 percent.

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Transportation Chief: 5 Airlines probed for price-gouging

WASHINGTON (AP) — Transportation Secretary Anthony Foxx said Friday the government has opened a price-gouging investigation involving five airlines that allegedly raised airfares in the Northeast after a deadly Amtrak crash in Philadelphia in May disrupted rail service.

The Transportation Department sent letters on Friday to Delta, American, United, Southwest and JetBlue airlines seeking information on their prices before and after the May 12 train crash.

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FDA OKs breakthrough cholesterol drug for high-risk patients

WASHINGTON (AP) — The Food and Drug Administration on Friday approved a first-of-a-kind drug that lowers artery-clogging cholesterol more than older drugs that have been prescribed for decades.

The drug from Sanofi and Regeneron Pharmaceuticals Inc. offers an important new option for millions of patients at high risk of heart disease. But the drug's sky-high price tag — $14,600 per year — is certain to escalate debate about the cost of breakthrough drugs and who should take them.

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Bristol-Myers wins approval for 1st hepatitis C type 3 drug

TRENTON, N.J. (AP) — An experimental drug for one of the hardest-to-treat types of hepatitis C has been approved by the Food and Drug Administration, adding to the surge of new options — all much more effective but extremely costly — for patients with the liver-destroying virus.

Daklinza, developed by New York-based Bristol-Myers Squibb Co., is the first drug approved to treat genotype 3, the second-most-common form. About 10 percent of Americans with hepatitis C have genotype 3.

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FIFA says corruption crisis hinders search for new sponsors

ST. PETERSBURG, Russia (AP) — The FIFA corruption crisis is hurting its search for new World Cup sponsors.

Targeting almost $6 billion in revenue from the 2018 tournament, FIFA has not signed any new sponsors since last year's World Cup in Brazil.

The first big event for host Russia has brought hundreds of international media to St. Petersburg, offering a natural stage for a sponsorship launch. However, Valcke said no major deals would be completed until FIFA's future is clearer — after Sepp Blatter is replaced as president next year.

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Greek invites IMF to join bailout talks, should begin Monday

ATHENS, Greece (AP) — Greece on Friday invited the International Monetary Fund to participate in its negotiations with European creditors over a vital third bailout — talks that are expected to start next week after a few days' delay and must conclude before Greece faces another big repayment Aug. 20.

Negotiators are now expected to arrive in Athens over the weekend with talks probably starting Monday, Greek officials said.

Athens is looking to secure yet another bailout — the third since its finances imploded in 2009 — worth 85 billion euros ($93 billion) over three years. Without the money, the country faces imminent bankruptcy and a probable exit from the shared euro currency.

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By The Associated Press=

The Dow Jones industrial average lost 163.39 points, or 0.9 percent, to 17,568.53. The Standard & Poor's 500 index fell 22.50 points, or 1.1 percent, to 2,079.65. The Nasdaq composite shed 57.78 points, or 1.1 percent, to 5,088.63.

Benchmark U.S. crude fell 31 cents to close at $48.14 a barrel in New York. Crude fell 5 percent for the week, and is down 19 percent for the month. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 65 cents Friday to close at $54.62 in London. Wholesale gasoline fell 2.4 cents to close at $1.828 a gallon. Heating oil fell 2.5 cents to close at $1.630 a gallon. Natural gas fell 4 cents to close at $2.776 per 1,000 cubic feet.