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Business Highlights

Posted January 10

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Despite scandal, VW in running for global sales crown

It's ironic: Volkswagen spent 2016 battling a huge emissions scandal and now it stands a decent chance to win the title of world's biggest carmaker for the year.

Booming business in China helped Volkswagen increase its sales to 10.31 million vehicles last year across all its brands, which include Audi, Porsche and Skoda, the company said Tuesday.

That was an increase of 3.8 percent over 2015, when Volkswagen came in second to Toyota. And a strong finish to the year in December — 11.8 percent better than the same month the year before — improves the company's chances of moving from No. 2 to No. 1 in global sales.

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Johnson & Johnson to reveal average drug price increases

Johnson & Johnson plans next month to disclose average price increases of its prescription drugs, as the industry tries to calm the storm over soaring prices.

The health care giant will divulge its 2016 average increases in list price and net price, or what middlemen such as insurers and distributors pay J&J after discounts and rebates.

Analysts say that will help J&J's image more than patients initially, but could push other drugmakers to tame future price increases and be more transparent.

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World Bank forecasting brighter prospects for 2017

The World Bank is forecasting the global economy will accelerate slightly in 2017 after turning in the worst performance last year since the 2008 financial crisis.

The 189-nation lending agency says that the global growth should expand at a 2.7 percent annual rate this year. That is down from the bank's June forecast for 2.8 percent growth this year, but it's better than last year's 2.3 percent growth.

The global economy faced a number of headwinds last year, from economic troubles in China to bouts of financial market turmoil.

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Wells Fargo overhauls pay plan for bank branch employees

Wells Fargo announced a complete restructuring Tuesday of how it pays tellers and other bank branch employees, as the company tries to right itself after a scandal over its aggressive sales practices.

The long-anticipated plan has been considered a high priority for CEO Tim Sloan and Mary Mack, the head of Wells Fargo's community bank division — both of whom took those jobs after the scandal emerged.

Wells Fargo's front-line bank employees will no longer be given incentives for how many new accounts they open or for meeting sales goals. They will instead receive part of their overall salary based on how the products they sell are used.

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Nasdaq sets another record high on mixed day for US stocks

The Nasdaq composite index notched its third record-high close in three days Tuesday, eking out a modest gain on a day when the other major U.S. stock indexes barely budged.

After wavering between small gains and losses for much of the day, the Standard & Poor's 500 index closed unchanged, while the Dow Jones industrial average posted a slight loss. More stocks rose than fell on the New York Stock Exchange.

Consumer-focused companies, banks and health care stocks were among the biggest gainers. Real estate companies lagged the most. Energy stocks also fell following a drop in crude oil prices.

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US job openings, quits rise, pointing to modest hiring ahead

U.S. employers posted more jobs in November and quitting also increased — signs that job gains and wages may increase in the months ahead.

The number of available jobs rose 1.3 percent in November from the previous month to 5.5 million, the Labor Department said Tuesday. Hiring rose 1.1 percent to 5.2 million.

The number of Americans who quit their jobs increased 1.4 percent to nearly 3.1 million, the second-highest total since the Great Recession. Quits are generally a good sign that workers are confident enough to leave their positions for new jobs.

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US wholesale inventories up 1 percent in November

U.S. wholesale businesses boosted their stockpiles in November by the largest amount in two years, while sales increased at a slower pace.

The Commerce Department says inventories held by wholesalers rose 1 percent in November after having fallen 0.1 percent in October. It was the biggest one-month gain since November 2014.

Sales at the wholesale level rose 0.4 percent in November after a 1.1 percent surge in October, the best in four months.

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Valeant sells $2B in assets to begin paying down debt

Valeant will sell just over $2 billion in assets as it pays down debts after more than a year of backlash against its pricing and business practices.

The company said Tuesday that it would sell three skincare brands to L'Oréal for $1.3 billion. The three product lines, CeraVe, AcneFree and AMBI, generate about $168 million in annual revenue.

The announced sale comes a day after Valeant said it would sell Dendreon Pharmaceuticals Inc. to China's Sanpower Group Co. for about $820 million

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Financial industry leaders renew Brexit warning

The CEO of the London Stock Exchange has offered a dire warning on the risks associated with the uncertainty of Brexit, with thousands of jobs in the balance, particularly from the lucrative business of clearing contracts.

Xavier Rolet warned lawmakers Tuesday that Brexit would potentially have a systemic impact and that many jobs associated with clearing of financial trades were at risk.

He said: "I'm not just talking about the clearing jobs themselves which number into the few thousands, but the very large array of ancillary functions... which range into far more than just a few thousand or tens of thousands of jobs."

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A sales bounce late in the year for Chipotle

Sales at established Chipotle restaurants turned positive last month, potentially sign that the burrito chain may be starting to recover from a food safety scare.

The Denver company said Tuesday that sales at established stores jumped 14.7 percent in December. They fell 1.4 percent in November and fell 20.2 percent in October.

The rebound in the final month of the year eclipsed a disappointing outlook for the entire fourth quarter.

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Mexico says it will negotiate with Trump

Mexico's new foreign relations secretary said Tuesday his country isn't just willing to negotiate changes to the North American Free Trade Agreement, it wants to start talks as soon as possible.

Luis Videgaray said there's "enormous uncertainty" following the U.S. election of Donald Trump as president. Trump has pressured companies not to move jobs to Mexico, warned he would tax those who do, and has vowed to renegotiate NAFTA.

Videgaray said in a Radio Formula interview that Trump's actions have caused concern, adding "that is why this (negotiation) process is so important, to dispel this uncertainty."

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The Dow Jones industrial average slipped 31.85 points, or 0.2 percent, to 19,855.53. The S&P 500 index was unchanged at 2,268.90. The Nasdaq added 20 points, or 0.4 percent, to 5,551.82.

U.S. benchmark crude oil lost $1.14, or 2.2 percent, to close at $50.82 a barrel in New York. Brent crude, which is used to price oil sold internationally, fell $1.30, or 2.4 percent, to close at $53.64 a barrel in London.

In other energy trading, wholesale gasoline slid 2 cents to $1.55 a gallon and heating oil fell 3 cents to $1.61 a gallon. Natural gas futures rose 18 cents, or 5.6 percent, to $3.28 per 1,000 cubic feet.

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