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Business Highlights

Posted September 20

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Wells Fargo CEO apologizes; senators heap criticism on bank

The CEO of Wells Fargo faced accusations of fraud and calls for his resignation Tuesday from harshly critical senators at a hearing over allegations that bank employees opened millions of accounts customers didn't know about to meet aggressive sales quotas.

Members of the Senate Banking Committee showed bipartisan outrage over the long-running conduct, unsatisfied by Chief Executive John Stumpf's show of contrition.

Stumpf said he was "deeply sorry" that the bank failed to meet its responsibility to customers and didn't act sooner to stem "this unacceptable activity." He promised to assist affected customers.

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AAA research finds people waste money on premium gas

There is no sense paying a premium for premium gasoline if your car is designed to run on regular, according to research by the automobile club AAA.

Some drivers occasionally like to treat their cars to higher-octane fuel in the belief it boosts performance. But premium blends can cost around 50 cents a gallon more than regular.

AAA says it's just money out the tailpipe — lots of it. In a national survey on gasoline use, AAA said 16.5 million U.S. drivers spent $2.1 billion they didn't need to in the past year on premium gasoline.

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Report finds racial wage gap widest in nearly 4 decades

As wages for American workers have stagnated for more than a generation, the income gap between black and white workers has widened, and discrimination is the main reason for the persisting disparity, according to a new report.

The Economic Policy Institute also found that young black women are being hit the hardest. This gap remains even after controlling for factors like education, experience, or geography.

The wage gap today is "worse now than it was 36 years ago," said Valerie Wilson, director of the liberal-leaning think tank's Program on Race, Ethnicity and the Economy.

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US stocks creep higher as Federal Reserve meeting starts

U.S. stocks inched higher Tuesday in another cautious day of trading as investors kept an eye on central banks in the U.S. and Japan.

Major market indexes were higher all day, but returned most of those gains at the close of trading. They rose just enough cancel out Monday's small losses.

Drug companies helped health care stocks make some modest gains, while Exxon Mobil fell on reports it's being investigated by securities regulators. Bond yields slipped and the dollar was little changed as investors waited decisions from the Federal Reserve and the Bank of Japan.

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FedEx beats Street 1Q forecasts

FedEx Corp. on Tuesday reported fiscal first-quarter profit of $715 million.

The company earned $2.65 per share and its earnings, adjusted for restructuring costs and amortization costs, were $2.90 per share. The results topped Wall Street expectations.

The average estimate of seven analysts surveyed by Zacks Investment Research was for earnings of $2.79 per share.

The package delivery company posted revenue of $14.66 billion in the period, also beating market forecasts.

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Monsanto, Bayer officials defend proposed $66 billion merger

Top officials for Monsanto and Bayer defended their proposed $66 billion merger before skeptical senators on Tuesday, insisting that the deal would lead to greater investments in technology that could help American farmers.

Monsanto, the American seed and weed-killer, and Bayer, the German medicine and farm-chemical maker, responded to concerns from Iowa Sen. Charles Grassley, the Republican chairman of the Senate Judiciary Committee.

Grassley warned that consolidation and competition in the U.S. seed and agrochemical industry could hurt American farmers who are already dealing with an economic downturn.

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SeaWorld says it will stop paying shareholders a dividend

Troubled theme park operator SeaWorld said it will soon stop paying its shareholders a quarterly dividend.

SeaWorld, known for its water shows featuring killer whales and dolphins, has been dealing with falling attendance and revenue as people's feelings about using animals for entertainment has soured.

The company said late Monday that it will pay its last dividend on Oct. 7, and the amount it pays will be cut by 52 percent to 10 cents for each share owned. SeaWorld said the money saved on dividends will be used to buy its own shares.

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Allergan targets liver disease drugs with Tobira acquisition

Botox-maker Allergan is bulking up its drug pipeline by acquiring Tobira Therapeutics Inc. and two potential liver disease treatments in a deal that could be worth almost $1.7 billion.

Tobira is testing two treatments for non-alcoholic steatohepatitis, a disease that triggers inflammation that can lead to cirrhosis, cancer and eventual liver failure.

Allergan PLC said Tuesday it will pay $28.35 in cash up front for each Tobira share plus up to $49.84 in contingent value rights, depending on whether certain development, regulatory and commercial milestones are met.

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Macy's to hire about 83,000 holiday workers

Macy's plans to hire about 83,000 people for the busy holiday shopping season, about equal to the number of hires last year.

The new hires will work at Macy's or Bloomingdale's department stores, call centers or at the company's facilities that ship products to stores and to online shoppers.

Macy's Inc., based in Cincinnati, has about 880 stores.

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West Virginia AG subpoenas Mylan over EpiPen price hike

West Virginia Attorney General Patrick Morrisey has subpoenaed drug company Mylan NV in an investigation over drastic price hikes for its EpiPen.

Morrisey announced Tuesday that he filed a petition to force Mylan to produce documents from a subpoena from several weeks ago. His office is seeking evidence of possible state antitrust and Medicaid rebate violations through the subpoena.

EpiPen prices have climbed 500 percent since 2007. The company has announced it will launch a generic version that costs $300.

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Congress fights for consumers' right to leave bad reviews

Congress is defending your right to Yelp.

Legislation in Congress would ensure that customers who want to post negative reviews on websites like Yelp or TripAdvisor can do so without legal repercussions. That's in response to some businesses that have made customers sign non-disparagement clauses and then sued if a bad review showed up.

Supporters say the legislation is needed to ensure freedom of speech in a growing online economy.

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The Dow Jones industrial average picked up 9.79 points, or 0.1 percent, to 18,129.96. The Standard & Poor's 500 index rose 0.64 points to 2,139.76. The Nasdaq composite edged up 6.33 points, or 0.1 percent, to 5,241.35.

Benchmark U.S. crude picked up 14 cents to $43.44 a barrel in New York. Brent crude, used to price international oils, slipped 7 cents to $45.88 a barrel in London. In other energy trading, wholesale gasoline sank 6 cents, or 4 percent, to $1.36 a gallon. Heating oil rose 1 cent to $1.41 a gallon. Natural gas jumped 11 cents, or 3.9 percent, to $3.05 per 1,000 cubic feet.

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