UK appeals for calm as markets drop, EU leaders huddle
LONDON (AP) — Prime Minister David Cameron insisted Monday that Britain’s vote to leave the European Union won’t send the economy into a tailspin, even as Standard & Poor’s stripped the U.K. of its top credit rating.
As stock markets and the pound continued to decline, Cameron insisted the British economy was robust and could withstand the shockwaves created by the result. Hours after he spoke, Standard & Poor’s knocked the U.K.’s sovereign rating by two notches, from AAA to AA, saying an exit will lead to a “less predictable, stable and effective policy framework in the U.K.”
Why Brexit endangers global unions that helped West prosper
WASHINGTON (AP) — Britain’s decision to bolt the European Union means economic pain for the United Kingdom above all. But it also threatens the economic alliances that helped drive decades of prosperity in the West after World War II.
And it could imperil an already wobbly global economy.
The Brexit vote “is just one chapter in a much bigger global story” in which Europe, the United States and other Western nations co-operate less, endure economic gloom and see their role in the world diminish, Megan Greene, chief economist with Manulife Asset Management, wrote in a research note Monday.
Greene and other analysts warn that the messy aftermath to the Brexit vote may splinter the EU, which has promoted postwar co-operation and the free flow of trade, job opportunities and immigration across Europe.
Lew says no sense of financial crisis developing
WASHINGTON (AP) — U.S. Treasury Secretary Jacob Lew says that the decision of British voters to leave the European Union is “an additional headwind” for the U.S. and global economies but “there is no sense of a financial crisis developing.”
In a CNBC interview Monday, Lew said, “I am not saying there will not be an impact on markets but it has been an orderly impact so far.”
Lew said it would be important for economic policymakers to signal that they are prepared to use the tools they have to promote economic growth and “not overreact to a volatile day here and there.”
Volkswagen reaches $14.7B emissions settlement
SAN FRANCISCO (AP) — Volkswagen would repair or buy back polluting vehicles and pay each owner as much as $10,000 under a $14.7 billion deal the car maker has reached to settle lawsuits stemming from its emissions cheating scandal, a person briefed on the settlement talks said Monday.
The deal sets aside $10 billion to repair or buy back roughly 475,000 polluting Volkswagen vehicles with 2-litre diesel engines, and to compensate each owner with an additional payment of between $5,100 and $10,000, the person said. The person asked not to be identified because the deal will not be filed in court until Tuesday, and a judge has ordered attorneys not to talk about it before then.
Owners who pick the buybacks would get the clean trade-in value of their cars from before the scandal became public on Sept. 18, 2015. The average value of a VW diesel has dropped 19 per cent since just before the scandal began. In August of 2015, the average was $13,196, and this May it was $10,674, according to Kelley Blue Book.
The settlement still requires a judge’s approval before it can go into effect.
Fading fishermen: A historic industry faces a warming world
SEABROOK, N.H. (AP) — One of America’s oldest commercial industries, fishing along the coast of the Northeast still employs hundreds. But those numbers are falling quickly. After centuries of weathering overfishing, pollution, foreign competition and increasing government regulation, climate change appears to be doing them in.
As waters have warmed, fish populations have struggled and the U.S. fishing fleet from more than 120,000 vessels in 1996 to about 75,000 today.
Diet Pepsi with aspartame returning to shelves in US
NEW YORK (AP) — Diet Pepsi made with aspartame is returning to shelves in the U.S., after PepsiCo saw sales plummet following its reformulation of the drink last summer to remove the artificial sweetener.
PepsiCo says it will offer “Diet Pepsi Classic Sweetener Blend” made with aspartame starting in September. The move is intended to appease fans who don’t like the taste of the reformulated drink, which is made with the artificial sweetener sucralose.
But PepsiCo Inc. said Diet Pepsi made with sucralose, commonly known by the brand name Splenda, will remain its primary diet soda offering.
TransCanada seeks $15B for rejection of Keystone pipeline
LINCOLN, Neb. (AP) — The company that proposed the Keystone XL pipeline is seeking $15 billion in damages from the federal government after the Obama administration rejected the Canada-to-Texas project, a company spokesman said Monday.
TransCanada Inc. filed a request for arbitration Friday under the North American Free Trade Agreement, arguing that the State Department’s actions led the company to believe the project would win approval. Obama rejected a federal permit for the project in November, saying it would have undercut the nation’s reputation as a global leader on addressing climate change.
Heading out of town: Independence Day travel to break record
NEW YORK (AP) — It’s going to be a busy holiday weekend on the nation’s highways.
A record 43 million Americans are expected to travel this Independence Day weekend, with the overwhelming majority driving, according to AAA, a car lobbying group and one of the nation’s largest travel agencies. This tops the joint record set last year and in 2007.
Lower gas prices, strong consumer confidence and a generally healthy domestic economy have led more families to take trips this summer.
Chipotle looks to recover with temporary loyalty program
NEW YORK (AP) — Chipotle is introducing a temporary loyalty program intended to get customers back into its stores following a series of food scares.
The chain already has given away millions of burritos to try to fill up empty locations after an E. coli outbreak and norovirus cases last year sent sales plunging. And on Monday, Chipotle said its “Chiptopia” loyalty program will reward people based on the number of times they visit each month, starting in July and running through September.
New Zealand poised to toughen rules for offshore trusts
WELLINGTON, New Zealand (AP) — New Zealand is poised to toughen its disclosure rules for offshore trusts in the wake of the massive data leak known as the “Panama Papers.”
Taxe expert John Shewan on Monday released a report recommending a big increase in the amount of information disclosed when a foreign trust sets up, as well as increased annual reporting requirements and enforcement.
Prime Minister John Key said officials need to review the government-commissioned report but he thinks most of the recommendations are reasonable and will be implemented.
The Dow Jones industrial average lost 260.51 points, or 1.5 per cent, to 17,140.24. The S&P 500 index slid 36.87 points, or 1.8 per cent, to 2,000.54. The Nasdaq composite fell 113.54 points, or 2.4 per cent, to 4,594.44.
Benchmark U.S. crude slid $1.31, or 2.7 per cent, to $46.33 a barrel in New York. Brent crude, used to price international oils, fell $1.25, or 2.6 per cent, to $47.16 a barrel in London. In other energy trading, wholesale gasoline dropped 5 cents to $1.48 a gallon. Heating oil fell 3 cents to $1.43 a gallon. Natural gas rose 5 cents to $2.72 per 1,000 cubic feet.