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US stocks trading higher ahead of Fed minutes

Written By Unknown on Rabu, 21 Mei 2014 | 23.14

Major U.S. stock indexes rebounded in morning trading Wednesday as investors monitored the latest batch of corporate earnings and awaited minutes from the Federal Reserve's policy meeting last month. Tiffany & Co. jumped after the upscale jewelry chain reported strong quarterly results.

KEEPING SCORE: The Standard & Poor's 500 index gained 13 points, or 0.7 percent, to 1,885 as of 11:14 a.m. Eastern Time. The Dow Jones industrial average rose 154 points, or 0.9 percent, to 16,528. The Nasdaq composite added 30 points, or 0.8 percent, to 4,127.

FED WATCH: The Federal Reserve was set to release the minutes of last month's meeting of its policymaking committee. Following the April 29-30 meeting, the central bank said it would further cut its bond purchases, noting that the U.S. job market needed less help. Traders will be watching for clues about how quickly the central bank plans to reduce its economic stimulus.

JEWEL IN THE CROWN: Tiffany jumped $8.19, or 9.3 percent, to $96.43 after the company said that its earnings spiked 50 percent in the first quarter as worldwide sales jumped by double digits and the company raised its prices. The results beat analysts' expectations and the jeweler raised its earnings forecast for the year.

"Retail is very fickle right now, but some sectors are doing well, like luxury," said Dan Veru, chief investment officer at Palisade Capital Management.

DATA BREACH EFFECT: Target reported a 16 percent drop in first-quarter earnings, reflecting the lingering effects of a massive customer data breach and troubled expansion plans in Canada. Still, the retailer said it saw significant improvement in a key revenue metric from what it experienced shortly after the data breach. Its shares rose 37 cents, or 0.7 percent, to $56.99.

SECTOR MONITOR: Nine of the 10 industry sectors in the S&P 500 rose, led by consumer discretionary and financial stocks. Utilities edged lower.

IN THE DOG HOUSE: PetSmart dropped $4.83, or 7.8 percent, to $57.40 after the pet store chain reported disappointing revenue for the first quarter and slashed its earnings outlook for the current quarter and year.

BONDS AND COMMODITIES: Bond prices fell. The yield on the 10-year Treasury note rose to 2.55 percent from 2.51 percent on Tuesday. The price of crude oil rose $1.03, or 1 percent, to $103.36 a barrel.


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EBay asks users to change password after breach

NEW YORK — E-commerce site eBay is asking users to change their password after a cyberattack compromised a database containing encrypted passwords.

The company says there is no evidence of any unauthorized activity and no evidence any financial or credit card information was stolen.

EBay says its investigation is active and it can't comment on the specific number of accounts affected, but says the number could be large, so it is asking all users to change their passwords. EBay had 145 million active users at the end of the first quarter.

Cyberattackers stole a small number of employee log-in credentials that gave access to eBay's corporate network, the company said. The San Jose, California-based company is working with law enforcement to investigate the attack.

The database was hacked sometime between late February and early March, but compromised employee log-in credentials were first detected two weeks ago.

EBay owns electronic payment service PayPal, but eBay says there is no evidence PayPal information was hacked, since that information is stored separately on a secure network.

The attack follows several other high-profile hacking incidents, including a massive data breach at Target stores and the spread of the computer security flaw nicknamed "Heartbleed." Heartbleed took advantage of a flaw in a key piece of security technology used by more than 500,000 websites that had been exposing online passwords and other sensitive data to potential theft for more than two years.

And during the Target credit data breach last year, hackers stole about 40 million debit and credit card numbers and personal information for 70 million people.

Shares of eBay Inc. fell 31 cents to $51.65 in morning trading.


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Gov.'s opiate task force weighs recommendations

BOSTON — A state panel charged with recommending ways Gov. Deval Patrick can address the state's drug abuse epidemic will discuss and possibly vote on recommendations.

Patrick formed the 36-member Opiate Task Force, which includes mayors, state officials and health care providers, when he declared drug abuse a public health emergency in Massachusetts in March.

The panel, chaired by Public Health Commissioner Cheryl Bartlett, is specifically charged with recommending how to spend $20 million the governor has designated to improve substance abuse treatment programs across the state.

State officials say the number of unintentional opiate overdoses nearly doubled, from 338 in 2000 to 668 in 2012, the most recent annual data available. Officials say an increase in pain medication prescriptions and greater availability of cheap heroin are among the causes.


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US stocks open higher ahead of Fed minutes

Stocks are opening higher as investors wait for the minutes from the Federal Reserve's most recent policy meeting.

Tiffany rose 9 percent after the company said its earnings spiked 50 percent in the first quarter as worldwide sales jumped and the company raised its prices.

The Dow Jones industrial average rose 101 points, or 0.6 percent, to 16,473 in early trading Wednesday.

The Standard & Poor's 500 index rose nine points, or 0.5 percent, to 1,882. The Nasdaq climbed 17 points, or 0.4 percent, to 4,114.

Later Wednesday the Fed will release minutes from its meeting last month. Traders will be watching for clues about how quickly the central bank plans to reduce its economic stimulus.

The yield on the 10-year Treasury note rose to 2.54 percent.


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Evergage raises $4 mil

Internet personalization start-up Evergage has raised $4 million, the company said.

The company also said it has seen consecutive 200 percent quarter-over-quarter revenue growth and has 110 new clients.

The investment was led by G20 Ventures. Existing investors also participated.

"We are excited to be working with the G20 and are already benefiting from Bob Hower's deep digital marketing and e-commerce software expertise," CEO Karl Wirth said in a statement. "Our platform helps digital businesses reduce the time, cost and complexity of gaining an understanding of website visitors and responding to them right in the context of their interaction."

Evergage's clients now includes Wayfair, Publisher's Clearing House, Palms Casino Resort and Stonyfield Farm.

The company allows businesses to personalize their websites for users, based on past behavior of the user. In 2012, Evergage raised $2 million.


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Opinionated Don Lemon breaking out at CNN

NEW YORK — CNN's Don Lemon braced himself after being recognized by a viewer on a Harlem street.

"I don't always agree with you," the person began, ominously. "But keep it up. I'm not always supposed to agree with you."

Lemon could think of no sweeter compliment. The 48-year-old news anchor has attracted attention by adding his opinion to stories he's telling. His bosses are rewarding him with more airtime, and his visibility has increased this spring through coverage of the missing Malaysia Airlines plane and other stories. He frequently hosts the 10 p.m. EDT news hour.

His decision to speak out traces directly to coming out publicly as gay in a memoir published three years ago.

Last week while moderating a discussion with four women on the firing of New York Times executive editor Jill Abramson, Lemon said he didn't believe in equal pay for equal work in all circumstances — the verbal equivalent of sticking his head in a lion's mouth. He denounced Florida's "stand your ground" law in coverage of a trial involving it. He offered troubled pop star Chris Brown advice "from one black man to another" in a segment on Tom Joyner's radio show.

No incident attracted more attention than when Lemon said he agreed with some criticism of blacks by Fox News' Bill O'Reilly. Young black men should think about pulling up their pants, staying in school, not using the n-word, not having children out of wedlock and taking interest in their communities, Lemon said.

That provoked a response from entrepreneur Russell Simmons, who wrote an open letter saying, "I can't accept that you would single out black teenagers as the cause of their own demise because they don't speak the King's English or wear belts around their waistbands."

Lemon said he knew that he would get a reaction, and that it was important to start a conversation.

"What surprised me was how many people would be taking it out of context and trying to turn it into something that it was not, that it was a criticism of African-Americans to tell them how to act, that it had something to do with racism," he said. "That had nothing to do with racism. That was self-empowerment."

Too often, he said, people think all blacks should feel the same way about issues and criticize any deviation, "which to me is the dumbest thing I've ever heard."

There's some concern Lemon is reacting to symptoms rather than the causes of problems in the black community, said Eric Deggans, author of "Race Baiter: How the Media Wields Dangerous Words to Divide a Nation."

"I've always felt that Don was an underappreciated anchor, and was afraid that he'd be another one of those black anchors at CNN who hasn't seemed to stick around," Deggans said. "I'm really glad that CNN values him enough to put him in prime time because I think it's important."

CNN has no problem with Lemon's opinions, so long as he's not predictably partisan. Janelle Rodriguez, vice president of programming at CNN U.S., said Lemon talks to viewers instead of talking down to them.

"Having a personality is a positive attribute," Rodriguez said.

Lemon had contracted to write a self-help book a few years ago and the subject even bored him. He turned it into a memoir, including the revelation he is gay. He wasn't sure he would include that fact before sending his manuscript to CNN's standards and practices department for review. His company didn't try to stop him, only warned him to be prepared for the attention.

He worried openly at the time whether it would hurt his career. It hasn't been much of an issue, although when Lemon criticized Rush Limbaugh for being a "stunt king" for comments the radio commentator made about Donald Sterling, Limbaugh made sure his rebuttal included the fact that Lemon "sleeps with men, proudly."

Talking openly about his sexuality and being abused as a child has made him free to put more of himself into his work, Lemon said.

"For me, personally, it's been empowering," he said, "and I can't go back."

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David Bauder can be reached at dbauder@ap.org or on Twitter@dbauder. His work can be found at http://bigstory.ap.org/content/david-bauder .

___

Online:

http://www.cnn.com/


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Netflix coming to Germany, France, 4 other markets

SAN FRANCISCO — Netflix will expand into Germany, France and four other European countries later this year as the Internet video service tries to build an international following that might eventually surpass its U.S. audience.

The additional markets announced Wednesday will extend Netflix's reach into nearly 50 countries, including 13 in Europe. Besides Germany and France, the latest countries on Netflix's list are Switzerland, Austria, Belgium and Luxembourg. The Los Gatos, California, company entered Europe in 2012 when its Internet video service debuted in the U.K. and Ireland.

Earlier this year, Netflix Inc. disclosed its plans to sell its service in more European countries without identifying where they would be.

The company still isn't saying which month its service will be available in the new markets or how much it will cost. Netflix recently raised its Internet streaming prices for new customers by about $1 per month around the world. With the increase, Netflix charges $9 per month for unlimited video streaming in the U.S. The company froze rates at $8 per month for two years for subscribers before the May 9 increase.

Netflix ended March with 35.7 million U.S. subscribers and an additional 12.7 million customers in the rest of the world. The company has set a long-term goal of 60 million to 90 million U.S. subscribers and more than 100 million internationally.

The overseas push has been costly so far for Netflix, which has amassed international losses exceeding $800 million since it ventured outside the U.S. for the first time in 2010. The company's U.S. operations, including a steadily shrinking DVD-by-mail service, have continued to churn out profits that so far have more than offset the international losses.

Last year, for instance, Netflix earned $112 million despite sustaining $274 million in international losses.

Netflix expects to start eking out a profit in its existing overseas markets by the end of this year.

Its shares rose $9.72, or 2.6 percent, to $381.39 in midday trading Wednesday. Its shares have risen about 1 percent so far this year.


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State appeals court rules in favor of oyster farm

BOSTON — A man who wants to start an oyster farm off the coast of Mashpee over the objections of some residents has won an important legal victory.

A three-judge panel of the state appeals court on Tuesday ruled in favor of Richard Cook's proposed 1.9-acre farm, which already has necessary town and state permits.

The ruling upheld two lower court decisions that said the Board of Selectmen and the town Conservation Commission properly approved the operation to be located about a quarter-mile offshore.

Some neighbors whose homes overlook the water challenged each board's ruling in separate cases, saying the oyster farm posed a safety concern and would spoil their views. The court called the plaintiffs' arguments "without merit" and "specious."

Cook's lawyer and Mashpee's town counsel welcomed the decision.

"This decision was consistent with what the town has been saying all along," town attorney Patrick Costello told the Cape Cod Times. "I think the plaintiffs have taken the approach of throwing as much muck as possible against the wall and seeing what sticks."

A lawyer for the neighbors didn't immediately return a message. The decision could be appealed to the full Massachusetts Appeals Court or the Supreme Judicial Court.

Opponents also are appealing a town zoning board decision in court.

Homeowners also attempted to use a lobbying firm to persuade a state lawmaker to put a provision into the state budget that would have killed the project.


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Gov't: Airlines should disclose bag, seat fees

WASHINGTON — Going to bat for confused passengers, the government is proposing that airlines be required to disclose fees for basic items like checked bags, assigned seats and carry-on bags so consumers know the true cost of flying.

Under new regulations proposed Wednesday by the Transportation Department, detailed fee information — including for a first and second checked bag — would have to be provided wherever passengers buy tickets, whether online, on the phone or in person. Any frequent-flier privileges would also be factored into the price.

Now, airlines are only required to disclose bag fees, and even then they don't have to provide an exact price. Some provide a wide range of possible fees in complex charts.

The rule would also require airlines to share fee information with travel agents and online ticketing services, which account for about 60 percent of ticket sales. Fee information is now usually available only through airlines.

The rule doesn't cover fees for early boarding, curbside check-in and other services.

The government also wants to expand its definition of a "ticket agent" so that consumer regulations like the fee-disclosure requirement apply to online flight search tools like Kayak.com and Google's Flight Search even though they don't actually sell tickets.

Many consumers are unable to determine the true cost of a ticket because fees are often hard to find or decipher, the government says.

"A customer can buy a ticket for $200 and find themselves with a hidden $100 baggage fee, and they might have turned down a $250 ticket with no baggage fee, but the customer was never able to make that choice," Transportation Secretary Anthony Foxx said in an interview.

"The more you arm the consumer with information, the better the consumer's position to make choices," Foxx said.

The public has 90 days to comment on the proposal. Foxx said he hopes the rule will become final within the next year.

The effort is partly a response to changes in airline industry business strategy since 2008, when carriers started taking services out of the price of tickets, beginning with checked bags.

More recently, some airlines have begun offering consumers not only a stripped-down "base" airfare, but also a choice of several packages with some of the once-free services added back into the cost of a ticket, but at higher prices. With packages and a la carte fees multiplying, comparison shopping for airfares is becoming more difficult, consumer advocates say.

The department also proposes expanding the pool of airlines required to report performance measures like late flights, lost bags and passengers bounced from flights due to overbooking. Currently, only airlines that account for at least 1 percent of the market must report performance measures, which the department posts online in its Air Travel Consumer Report. The proposed regulations would include carriers that account for little as 0.5 percent of the market. That would bring in discount carrier Spirit Airlines and many regional air carriers.

A trade association for the airline industry said the "proposal overreaches and limits how free markets work," predicting "negative consequences."

"The government does not prescriptively tell other industries — hotels, computer makers, rental car companies — how they should sell their products, and we believe consumers are best served when the companies they do business with are able to tailor products and services to their customers," Airlines for America said in a statement.

But Charlie Leocha, who lobbies for passenger rights on behalf of the Consumer Travel Alliance, welcomed the proposal. "We are getting most of what consumers have been requesting for more than five years," he said.

The proposal also would:

— Require large travel agencies to adopt "minimum customer service standards," such as responding promptly to customer complaints and providing an option to hold a reservation at the quoted fare without payment for 24 hours if made more than a week ahead of the flight.

— Require airlines and ticket agents to disclose whether the ticket being sold is for a flight operated by another carrier under a partnership arrangement. For example, United Airlines sells tickets for flights operated as "United Express" by several regional airlines. But the planes and crews belong to the regional carrier.

— Prohibit "unfair and deceptive" practices by airfare search tools, such as ranking flights by some airlines ahead of others without disclosing that bias to consumers.

The proposed rules are the Obama administration's third wave of consumer protections for airline passengers. The effort began with a ban on so-called tarmac strandings in which passengers were cooped up in planes for hours, sometimes in miserable conditions. Facing the prospect of fines of as much as $27,500 per passenger, airlines have nearly eliminated such incidents by canceling flights in advance of severe weather.

Other previously adopted regulations include tougher requirements for compensating passengers denied boarding because of overbooking and a requirement that airlines, travel agents and online ticketing sites display full airfares, including taxes and government fees, more prominently than base airfares. Previously, airlines often advertised base airfares and buried mention of taxes and government fees — typically about 20 percent of the ticket price — in fine print.

The airline industry has clashed with the administration over some of the regulations, especially the requirement that taxes and fees be included in advertised fares. Several airlines sued in federal court to overturn the rule, but the court sided with the government, and the Supreme Court refused to hear their appeal.

Airlines have taken their case to Congress, where a House committee recently approved a bill that would effectively nullify the rule and allow airlines to return to displaying base fares and adding in taxes and fees later.

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Follow Joan Lowy on Twitter at https://twitter.com/AP_Joan_Lowy


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Bill would let Twin River extend $75K in credit

PROVIDENCE, R.I. — A credit line of up to $75,000 could be extended to gamblers at Twin River under legislation set to be reviewed by the House Finance Committee.

The bill, sponsored by Finance Chairman Raymond Gallison, is being heard Wednesday.

The introduction to the bill calls it imperative that legislative steps be taken to "preserve and protect the state's ability to maximize revenues at Twin River in an increasingly competitive gaming market."

Rhode Island is projecting a significant loss of gambling revenue because of expected gambling expansion in Massachusetts.

Twin River spokeswoman Patti Doyle calls the extension of credit an amenity and says it's a common industry practice. She says players would be subject to rigorous background and credit checks and that Twin River would be responsible for any nonpayment.


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