Business news in brief

Mortgage rates edge higher, end slide

WASHINGTON -- Long-term U.S. mortgage rates edged up this week as the benchmark 30-year rate bounced back from a seven-month low.

Mortgage buyer Freddie Mac said Thursday that the average 30-year, fixed-rate mortgage rose to 3.91 percent this week from 3.89 percent last week. The rate stood at 3.54 percent a year ago and averaged a record low 3.65 percent in 2016.

The rate on the 15-year mortgage rose to 3.18 percent from 3.16 percent.

Freddie Mac chief economist Sean Becketti said this week's higher rates might not last. Freddie Mac, the Federal Home Loan Mortgage Corp., surveyed mortgage lenders before the government reported Wednesday that U.S. consumer prices fell in May, causing a drop in the yield on 10-year Treasury notes, which often influences mortgage rates.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fees on 30-year and on 15-year mortgages were both unchanged at 0.5 point.

-- The Associated Press

Energy report predicts plunge for coal

Coal's share in the U.S. power mix is projected to fall in half by 2040, according to a report from Bloomberg New Energy Finance.

The fossil fuel -- which in 2008 generated half of America's electricity -- will see a steep decline in market share starting in the latter half of the next decade as closures of U.S. coal-fired power plants mount, according to Bloomberg New Energy Finance's "New Energy Outlook 2017" report published Thursday. Over that stretch, gas-fired electricity is forecast to rise by 22 percent while power from renewables is seen jumping by 169 percent.

While President Donald Trump has voiced repeated support for coal, the "economic realities over the next two decades" will not favor it in the power mix, Bloomberg New Energy Finance said in a statement about the report.

Coal's future looks brighter in some other long-term forecasts. The U.S. Energy Information Administration, in its 2017 annual energy outlook, projected that in 2040 coal will be used to generate 31 percent of America's electricity. That scenario assumes the Obama-era Clean Power Plan -- a set of rules designed to curb carbon-dioxide emissions -- doesn't go into force. Trump has moved to kill those rules.

-- Bloomberg News

Nike to ax 1,400 jobs, pare shoe styles

NEW YORK -- Nike wants to be more nimble on its feet and sell more shoes directly to customers online as part of a restructuring in which it plans to cut about 1,400 jobs and reduce by 25 percent the number of sneaker styles it offers.

The company announced several changes to its business structure Thursday, saying the moves will help it offer more products to customers faster.

Nike, which is based in Beaverton, Ore., said the jobs cuts represent about 2 percent of its 70,000 employees around the world.

It also says a main focus will be the 12 key cities in 10 countries that it expects to represent more than 80 percent of its projected growth through 2020.

Shares of Nike Inc. fell $1.76 to close Thursday at $52.90.

-- The Associated Press

Airline puts system-failure tab at $102M

British Airways owner IAG SA said a power failure that led to the cancellation of hundreds of flights last month probably cost it about $102 million in lost revenue and the expense of accommodating, re-booking and compensating thousands of passengers.

The figure is based on an initial assessment, and London-based IAG will update the market on the exact figure in due course, Willie Walsh, the group's chief executive officer, said at its annual shareholder meeting Thursday.

"It was a dreadful experience for many of our customers and we are truly sorry," Walsh said in Madrid, adding that "passengers will be compensated as soon as possible."

At least 75,000 travelers found themselves grounded over three days from May 27 as the U.K. carrier's information-technology systems crashed. Walsh has said previously that the meltdown seems to have happened after an engineer disconnected a power supply at a data center near London Heathrow airport, causing a surge that resulted in major damage when it was reconnected.

-- Bloomberg News

Builders aim to hire but workers scarce

A majority of commercial builders and contractors in the U.S. plan to employ more workers in the coming months. That's assuming they can find them.

While industry leaders are feeling optimistic about the current and future health of the sector and say they plan to increase hiring accordingly, about 61 percent of contractors say it's difficult to find skilled workers, according to an inaugural quarterly report released Thursday by building-products manufacturer USG Corp. and the U.S. Chamber of Commerce.

Contractors across the country expressed concern over hiring. In the Midwest, 79 percent said they expect to employ more people in the next six months, but most also reported trouble attracting qualified applicants.

For the report, researchers surveyed 204 contractors from a pool of 2,700 spread across the U.S. and evenly distributed by size. The poll was conducted online from April 12 to April 20.

-- Bloomberg News

De Beers launches diamond-finder ship

WALVIS BAY, Namibia -- Namibia and the De Beers company on Thursday inaugurated what the diamond producer calls the world's largest diamond exploration vessel.

The $157 million ship is designed to find diamonds more easily off the country's Atlantic Ocean coastline.

De Beers CEO Bruce Cleaver said about 75 percent of the 1.6 million carats produced in Namibian operations last year came from offshore deposits. The company calls itself the world's largest diamond producer by value.

The diamond industry is a pillar of the Namibian economy, and De Beers expects its offshore operations to spur production until at least 2050.

The new vessel is part of a joint venture between Namibia and De Beers to explore diamond deposits with greater speed and accuracy up to 460 feet below the sea's surface.

The SS Nujoma is named after Sam Nujoma, Namibia's first president after independence in 1990. He was among the dignitaries who gathered to view the 370-foot ship.

-- The Associated Press

Business on 06/16/2017

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