News Archive

SEC awards $22 million to ex-Monsanto executive through whistleblower program

A former Monsanto Co (MON.N) executive who tipped the U.S. Securities and Exchange Commission to accounting improprieties involving the company’s top-selling Roundup product has been awarded more than $22 million from the agency’s whistleblower program, the executive’s lawyer said on Tuesday.

The award of $22,437,800 was tied to an $80 million settlement between the SEC and Monsanto in February, according to the lawyer, Stuart Meissner in New York, in a statement. It is the agency’s second largest under the program.

Meissner declined to reveal the whistleblower’s identity.

Monsanto said in an emailed statement, “It would be inappropriate for our company to comment on the SEC’s whistleblower program or this specific award.”

The Dodd Frank financial reform law empowered the SEC to award money to whistleblowers who give information to the agency which leads to a fine.

Awards to 33 whistleblowers by the SEC’s program have now surpassed a total of $107 million since the agency launched the program in 2011, the agency said in a statement on Tuesday. The largest award, in 2014, was $30 million, the agency said.

Monsanto’s $80 million SEC settlement followed allegations that the company misstated its earnings in connection with Roundup, a popular weed killer.

The SEC’s case against Monsanto revolved around a corporate rebate program designed to boost Roundup sales.

The SEC had said that Monsanto lacked sufficient internal controls to account for millions of dollars in rebates that it offered to retailers and distributors. It ultimately booked a sizeable amount of revenue, but then failed to recognize the costs of the rebate programs on its books.

That led the St. Louis-based agriculture company to “materially” misstate its consolidated earnings for a three-year period.

Monsanto neither admitted nor denied the charges and said at the time that it fully reserved funds to pay for the penalty in fiscal year 2015.

The SEC announced the award earlier on Tuesday, but did not reveal the enforcement action to which it was linked or the whistleblower’s identity.

“Company employees are in unique positions behind-the-scenes to unravel complex or deeply buried wrongdoing. Without this whistleblower’s courage, information, and assistance, it would have been extremely difficult for law enforcement to discover this securities fraud on its own,” said Jane Norberg, Acting Chief of the SEC’s Office of the Whistleblower, in a statement.

The award represents more than 28 percent of the total penalty and nearly the 30 percent maximum allowed under the SEC’s bounty program for payments higher than $1 million, Meissner said.

(Reporting by Suzanne Barlyn; Editing by Steve Orlofsky, Bernard Orr)

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EU-U.S. trade deal in doubt as France urges end to talks

PARIS/BRUSSELS France cast serious doubt on Tuesday on the prospects of an EU free trade deal with the United States, adding to opposition within Germany and growing scepticism among Americans.

Washington and Brussels are officially committed to sealing the Transatlantic Trade and Investment Partnership (TTIP) before U.S. President Barack Obama leaves office in January, but their chances of doing so are being eroded by approaching elections on both sides of the Atlantic and Britain’s vote in June to leave the European Union.

“Everything is moving. In this situation it’s just not going to happen,” said Peter van Ham, senior research fellow at Dutch think tank Clingendael and author of a paper on Tuesday called “TTIP is dead, long live transatlantic trade”.

French Trade Minister Matthias Fekl said he would request a halt to TTIP talks at next month’s EU trade ministers’ meeting in Bratislava after German Economy Minister Sigmar Gabriel declared at the weekend that talks were “de facto dead”.

Observers say both are responding to public mistrust of a deal that critics say would lower environmental and food standards and allow foreign multinationals to challenge government policies.

Stop TTIP campaigns have been particularly vocal in Germany and Austria, which supporters of TTIP say are among the countries most likely to benefit from increased U.S. trade.

In the United States, Obama has promoted the accord, saying it would fuel growth. But the public mood is turning increasingly negative, with Republican presidential candidate Donald Trump making attacks on international trade deals a cornerstone of his campaign, saying they have cost U.S. jobs.

His opponent, Democratic nominee Hillary Clinton, has also stepped back from her previous support for free trade when she was U.S. Secretary of State, and has questioned whether trade deals hold down U.S. wages.


German Foreign Minister Frank-Walter Steinmeier, of Gabriel’s Social Democratic Party (SPD), urged diplomats and business chiefs on Tuesday to counter anti-globalization sentiments that are fuelling opposition to free trade deals.

Ahead of elections in France and Germany next year, politicians are keenly aware that TTIP is not a vote winner.

The Bertelsmann Foundation poll showed only 17 percent of Germans saw TTIP as a good thing in April, down from 55 percent two years earlier.

“There may be an economic rationale, but everyone is scrapping for votes and you lose votes if you support TTIP,” Van Ham said, adding that any credit from potential free trade gains would be two to three years away.

Supporters say TTIP could boost each economy by $100 billion, creating jobs at a time of economic uncertainty as growth and consumption slow in China and emerging markets. EU leaders backed TTIP talks at a summit in June.

Speaking to reporters in Washington, White House spokesman Josh Earnest admitted “significant aspects” of the deal were unresolved, but said U.S. Trade Representative Michael Froman would travel to Europe in an effort to push the talks forward.

“I anticipate that when he travels to Europe in mid-September that they’ll be engaged in substantive discussions and hopefully will be able to make some additional progress,” Earnest said.

Three years of negotiations have failed to resolve multiple differences, however, including over public procurement and rules to protect foods from particular regions, such as Parma ham, which the EU wants, and greater access to services and for its agricultural products, as demanded by the United States.

“Practically there’s no real change. It’s been stuck for the better part of two years,” said Hosuk Lee-Makiyama, director of Brussels-based think tank ECIPE.


EU trade chief Cecelia Malmstrom told journalists negotiations had not failed and that many EU countries had said they still backed TTIP.

They included Italy, whose trade and industry minister said it was essential for Italian exporters that the negotiations bore fruit.

Germany’s Gabriel is the chairman of the SPD who share power with Chancellor Angela Merkel’s conservatives. Merkel backs the talks and her spokesman insisted on Monday that they should continue.

Malmstrom added that it made no sense to suspend talks in September because the two sides could still make advances in regulatory cooperation, agreeing standards that are important to industries such as the auto sector, and that could be picked up by Obama’s successor even if a deal was not sealed this year.

“The more work we have done, the easier it is to resume,” she said before a planned video conference with Froman.

Froman has said Britain’s EU exit will affect TTIP because Britain consumes about a quarter of U.S. exports to the bloc.

Trade analysts say that Washington may be preparing for the end of trade talks, which typically conclude with each side holding the other responsible for failure.

President Francois Hollande told ambassadors on Tuesday that talks were “bogged down” and “unbalanced” and it was an illusion to imagine that a deal could be sealed during Obama’s term.

“Very soon you end in a blame game,” said Lee-Makiyama. “But trade negotiations never really die. They just go into a stock-taking phase.”

(Reporting by Sophie Louet and John Irish in Paris, Crispian Balmer in Rome, and Madeline Chambers and Andrea Shalal in Berlin; Writing by Andrew Callus, Philip Blenkinsop and Bill Rigby; Editing by Catherine Evans and James Dalgleish)

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U.S. job market optimism lifts consumer confidence to 11-month high

NEW YORK U.S. consumer confidence rose to an 11-month high in August, with households more upbeat about the labor market, in a further sign that the economy was regaining steam after faltering in the first half of the year.

While other data on Tuesday showed a moderation in house prices in June, the gains probably remain sufficient to boost household wealth and continue to support consumer spending, as well as make home purchasing affordable for first-time buyers.

“This will likely be interpreted as more evidence that the U.S. economic recovery is back on track following the missteps earlier this year,” said Millan Mulraine, deputy chief economist at TD Securities in New York. 

The Conference Board said its consumer confidence index increased 4.4 points to 101.1 this month, the highest reading since September 2015. Consumers’ assessment of both current business and labor market conditions improved sharply in August.

The survey’s so-called labor market differential, derived from data about respondents who think jobs are hard to get and those who think jobs are plentiful, was the most favorable since January 2008.

This measure, which closely correlates to the unemployment rate in the Labor Department’s employment report, is pointing to further declines in the jobless rate and labor market slack.

Economists said this supported views by Federal Reserve officials that the jobs market was either at or near full employment. Fed Vice Chairman Stanley Fischer said on Tuesday that jobs market was “very close to full employment.”

Consumers’ bullish assessment of the labor market this month could be reflected in August’s employment report, which is scheduled for release on Friday, economists said.

“This labor differential index supports our view that payrolls is likely to be quite robust in August. We expect to see job gains in the 215,000 neighborhood,” said Bricklin Dwyer, an economist at BNP Paribas in New York.

A separate survey last week showed an ebb in consumer sentiment this month.

The dollar rose to a two-week high against a basket of currencies, while prices for U.S. government debt fell. U.S. stocks were trading lower as Apple (AAPL.O) shares slipped after European Union anti-trust regulators ordered the tech giant to pay about $14.5 billion in back taxes to the Irish government.


The consumer confidence report added to strong data on consumer spending, residential construction, durable goods orders and industrial production that have suggested an acceleration in economic growth after output expanded at 1.0 percent in the first half of the year.

The steady stream of solid economic reports could give the Fed ammunition to raise interest rates this year, even as inflation pressures remain benign.

The U.S. central bank hiked interest rates at the end of last year for the first time in nearly a decade, but has held them steady since amid concerns over persistently low inflation. Most economists expect another rate hike in December.

“We advise Fed officials to throw their caution to the wind just like the American consumer is. It is time for Fed officials to get back on track and move rates up at a gradual pace,” said Chris Rupkey, chief economist at MUFG Union Bank in New York.

Separately, the SP CoreLogic Case-Shiller composite home price index of 20 U.S. metropolitan areas rose 5.1 percent in June from a year ago after increasing 5.3 percent in May.

Prices in the 20 cities fell 0.1 percent in June from May on a seasonally adjusted basis, the survey showed, matching expectations for a decline of 0.1 percent.

On a non-seasonally adjusted basis, prices increased 0.8 percent from May. Home prices in three U.S. cities – Denver, Seattle and Portland, Oregon – showed the highest year-over-year gains, the survey showed.

The Conference Board survey this month showed a rise in consumer intentions to purchase a home as well a plans to buy major household appliances.

“Today’s reading is consistent with consensus forecasts for a moderate upward trend in home sales,” said Andrew Hollenhorst, an economist at Citigroup in New York.

(Reporting by Lucia Mutikani and Chuck Mikolajczak; editing by Chizu Nomiyama)

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EU demands Apple pay Ireland up to 13 billion euros in tax

BRUSSELS EU antitrust regulators ordered Apple (AAPL.O) on Tuesday to pay up to 13 billion euros ($14.5 billion) in taxes plus interest to the Irish government after ruling that a special scheme to route profits through Ireland was illegal state aid.

The massive sum, 40 times bigger than the previous known demand by the European Commission to a company in such a case, could be reduced, the EU executive said in a statement, if other countries sought more tax themselves from the U.S. tech giant.

Apple, which with Ireland said it will appeal the decision, paid tax rates on European profits on sales of its iPhone and other devices and services of between just 0.005 percent in 2014 and 1 percent in 2003, the Commission said.

“Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other businesses over many years,” said Competition Commission Margrethe Vestager, whose crackdown on mainly U.S. multinationals has angered Washington which accuses Brussels of protectionism.

Online retailer Inc (AMZN.O) and hamburger group McDonald’s Corp (MCD.N) face probes over taxes in Luxembourg, while coffee chain Starbucks Corp (SBUX.O) has been ordered to pay up to 30 million euros ($33 million) to the Dutch state.

A bill of 300 million euros this year for Swedish engineer Atlas Copco AB (ATCOa.ST) to pay Belgian tax is the current known record. Other companies ordered to pay back taxes in Belgium, many of them European, have not disclosed figures.

For Apple, whose earnings of $18 billion last year were the biggest ever reported by a corporation, finding several billion dollars should not be an insurmountable problem. The 13 billion euros represents about 6 percent of the firm’s cash pile.

As of June, Apple reported it had cash, cash equivalents and marketable securities of $231.5 billion, of which 92.8 percent, or $214.9 billion, were held in foreign subsidiaries. It paid $2.67 billion in taxes during its latest quarter at an effective tax rate of 25.5 percent, leaving it with net income of $7.8 billion according to company filings.

The European Commission in 2014 accused Ireland of dodging international tax rules by letting Apple shelter profits worth tens of billions of dollars from tax collectors in return for maintaining jobs. Apple and Ireland rejected the accusation.

“I disagree profoundly with the Commission,” Irish Finance Minister Michael Noonan said in a statement. “The decision leaves me with no choice but to seek cabinet approval to appeal.

“This is necessary to defend the integrity of our tax system; to provide tax certainty to business; and to challenge the encroachment of EU state aid rules into the sovereign member state competence of taxation.”

Ireland also said the disputed tax system used in the Apple case no longer applied and that the decision had no effect on Ireland’s 12.5 percent corporate tax rate or on any other company with operations in the country.

Apple said in a statement it was confident of winning an appeal.

“The European Commission has launched an effort to rewrite Apple’s history in Europe, ignore Ireland’s tax laws and upend the international tax system in the process. The Commission’s case is not about how much Apple pays in taxes, it’s about which government collects the money. It will have a profound and harmful effect on investment and job creation in Europe.”


When it opened the Apple investigation in 2014, the Commission told the Irish government that tax rulings it agreed in 1991 and 2007 with the company amounted to state aid and might have broken EU laws.

The Commission said the rulings were “reverse engineered” to ensure Apple had a minimal Irish bill and that minutes of meetings between Apple representatives and Irish tax officials showed the company’s tax treatment had been “motivated by employment considerations.”

Apple employs 5,500, or about a quarter of its Europe-based staff, in the Irish city of Cork, where it is the largest private sector employer. It has said it paid Ireland’s 12.5 percent rate on all the income that it generates in the country.

Ireland’s low corporate tax rate has been a cornerstone of economic policy for 20 years, drawing investors from multinational companies whose staff account for almost one in 10 workers in Ireland.

Some opposition Irish lawmakers have urged Dublin to collect whatever tax the Commission orders it to. But the main opposition party Fianna Fail, whose support the minority administration relies on to pass laws, said it would support an appeal based on reassurances it had been given by the government.

The U.S. Treasury Department published a white paper last week that said the EU executive’s tax investigations departed from international taxation norms and would have an outsized impact on U.S. companies. The Commission said it treated all companies equally.

(Additional reporting by Padraic Halpin in Dublin, Robin Emmott, Philip Blenkinsop, Robert-Jan Bartunek and Alastair Macdonald in Brussels and Eric Auchard in Frankfurt; Writing by Alastair Macdonald; Editing by Philip Blenkinsop)

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U.S. banks see higher net income, expand lending in second quarter

WASHINGTON U.S. banks saw their net income increase $584 million, or 1.4 percent, compared to the second quarter of last year in a sign of strength for the sector, according to the Federal Deposit Insurance Corporation.

Total credits increased 1.5 percent, $241 billion, in the second quarter driven largely by new home loans and real estate credits, the regulator said on Tuesday. Credit card balances and loans to non-banks also increased.

“Income and revenue both increased from a year ago,” FDIC Chairman Martin Gruenberg said in a statement. “Loan growth remained strong, the number of unprofitable banks was at an 18-year low.”

Low prices for fossil fuels continue to put pressure on the energy sector and banks that offered credit to that industry may face further stress, Gruenberg said.

“We likely have not yet seen the full impact of low energy prices on the banking industry,” he said in a statement.

In a separate announcement, the FDIC said the largest U.S. banks would begin contributing more to the insurance fund to comply with the Dodd Frank Wall Street reform legislation.

(Reporting by Patrick Rucker; Editing by Chizu Nomiyama)

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Abercrombie no longer sees comparable sales improving this year

Teen apparel retailer Abercrombie Fitch Co posted its 14th straight quarter of declining sales and said it no longer expects comparable sales to improve this year, highlighting its struggles to win back shoppers.

The retailer’s shares tumbled nearly 21 percent on Tuesday, set for their biggest one-day percentage drop since 2001.

Abercrombie and other retailers have struggled to compete with the trendier and often cheaper products at fast-fashion retailers such as HM and Inditex’s Zara as well as with online and off-price retailers.

To win back shoppers, Abercrombie is investing heavily in its online business and on remodeling stores, and closing underperforming stores. It has hired designers from top brands to keep its trends fresh and is selling fewer of its once-popular logo-centric designs.

Still, Abercrombie’s comparable sales fell a slightly steeper-than-expected 4 percent in the second quarter, due to lower traffic, including from tourists, at its flagship stores and fashion missteps in women’s tops.

“Comparable sales (will) remain challenging through the second half of the year, with a disproportionate effect from flagship and tourist locations,” Abercrombie said.

The retailer had, in May, forecast comparable sales would improve later this year as its product assortment improved and investments in marketing and store management paid off.

Abercrombie’s remodeled Hollister stores had been nursing the brand back to health. It remodeled 32 Hollister stores in the second quarter and plans to revamp 20 more this year.

The company also said it was working on a new AF store prototype, hoping to replicate its success with Hollister.

While, Abercrombie’s cost of sales, and stores and marketing expenses dipped, it was not enough to offset the drop in sales.

Gross margin dropped 140 basis points to 60.9 percent, also hurt by the weaker pound following Britain’s vote to leave the European Union in June. Margins are expected to fall in the current quarter as well.

Abercrombie said there were “minor disruptions” in traffic and sales over the weekend of the Brexit vote. The UK is the company’s biggest market by store count after the United States.

The net loss attributable to Abercrombie increased in the quarter. Its adjusted loss of 25 cents per share was bigger than analysts average estimate of 20 cents, according to Thomson Reuters I/B/E/S.

Net sales fell 4.2 percent to $783.2 million, beating analysts’ estimates of $782.7 million, in part helped by strong growth in its online business and an uptick in its European business.

(Reporting by Subrat Patnaik in Bengaluru; Editing by Savio D’Souza)

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VW reviews supplier strategy after dispute hits production

HAMBURG Volkswagen (VOWG_p.DE) Chief Executive Matthias Mueller has vowed to review the German car giant’s procurement strategy to avoid any repetition of the crippling supplier dispute that hit production at six plants this month.

Still reeling from a diesel emissions scandal, VW will re-examine contracts that leave the group dependent on a single supplier after the dangers were highlighted by its damaging wrangle with Bosnian parts maker Prevent, Mueller said.

“We will of course look into questions such as multi-sourcing, single-sourcing,” he told reporters late on Monday. “We will look at our procurement contracts and try to optimize matters with all suppliers.”

Carmakers generally seek to avoid over-dependence on any one supplier and seek to duplicate critical relationships even at slightly higher unit costs.

But Car Trim and ES Automobilguss, two suppliers within privately held Prevent group, exposed a vulnerability when they halted seat cover and gearbox parts deliveries, triggering stoppages at VW assembly plants.

Since the 2008 financial crisis, carmakers have outsourced more parts development and manufacturing to save cash and meet technological demands for electric vehicles, smartphone-compatible infotainment and autonomous driving.


That makes multiple sourcing harder to achieve. The Prevent dispute also underlines the dangers of relying on a single group for a range of components — another inevitability in today’s consolidating supplier industry.

Recent tie-ups include ZF’s $12.4 billion takeover of TRW, Magna’s (MG.TO) $1.9 billion Getrag purchase and Continental’s acquisition of Veyance Technologies. Fiat Chrysler (FCHA.MI) is said to be exploring a sale of Magneti Marelli.

VW’s relationship with Prevent soured after it commissioned Car Trim to develop new seat covers for high-end models including Porsches and then canceled the 500 million euro ($558 million) deal in the aftermath of the diesel scandal, refusing to cover the 58 million euros its supplier had already invested.

Parent company Prevent retaliated by moving some of Car Trim’s financial claims against VW to Automobilguss, sole supplier of a key gearbox casing for VW’s top-selling Golf compact, said two sources with knowledge of the matter.

“One could discuss at length who’s to blame for the fact that this situation went belly up,” VW’s Mueller said, declining further comment.

Disputes like this one, resolved by a settlement last week, are unusual among suppliers to German automakers. Many, unlike Prevent, subscribe to a VDA industry code that aims to resolve conflicts without disruption.

VW insiders blame management changes at Prevent for the escalation, Handelsblatt newspaper reported. Nijaz Hastor, the family shareholder’s patriarch, recently handed effective control to his sons.


The incident nevertheless highlights the German carmaker’s efforts to boost efficiency under Herbert Diess, hired to head the underperforming VW brand weeks before the September revelations that VW cheated U.S. diesel emissions tests.

In a June letter seen by Reuters, VW procurement chief Francisco Javier Garcia Sanz warned suppliers that he would seek new savings as the company faced “epochal change driven by new technologies and customer requirements”.

Parts makers’ average operating margins have risen to 13.4 percent based on earnings before interest, tax and depreciation, according to Citigroup. That compares with 9.6 percent for carmakers globally, and the competition for profit could intensify as sales growth slows in China, Europe and the United States.

    “Arguably, suppliers are getting the better end of industry profits at present,” London-based Citibank analyst Michael Tyndall said in a recent note to investors.

    Contract cancellations may become more widespread as carmakers including BMW and Fiat Chrysler pare down vehicle line-ups and shift investments to electrified transmissions, Tyndall said.

“It may be there are more disputes to come,” he added.

($1 = 0.8957 euros)

(Writing by Edward Taylor and Laurence Frost; Editing by Mark Potter and David Goodman)

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Oil prices rise on U.S. weather fears, OPEC speculation

LONDON Oil futures rose on Tuesday supported by production suspensions in the U.S. Gulf due to an expected tropical storm and speculation that producers meeting in Algeria next month will act to prop up prices.

Brent crude futures LCOc1 were trading at $49.58 per barrel at 1358 GMT (0958 EDT), up 32 cents from the previous close.

U.S. West Texas Intermediate (WTI) crude CLc1 was up 39 cents at $47.37 a barrel.

Oil and gas operators in the U.S. Gulf of Mexico have shut output equal to 168,334 barrels per day (bpd) of oil and 190 million cubic feet per day of natural gas as a precaution against a tropical storm, the U.S. Bureau of Safety and Environmental Enforcement said on Monday.

Shell said it had shut production at its Coulomb field in the region after BP (BP.L) shut its Na Kika platform ahead of Tropical Depression Nine.

Oil prices have also been taking direction from speculation that a meeting next month in Algeria of major producers, including members of the Organization of the Petroleum Exporting Countries, could yield a production deal to support prices.

“Prices are still finding support from the expectations of an agreement on production caps being reached at the late-September meeting,” Commerzbank said in a note.

Saudi Arabian Energy Minister Khalid Al-Falih told Reuters last week he does not believe an intervention in oil markets is necessary since the “market is moving in the right direction”.

Iraq – which exported more crude this month from its southern ports than in July – will continue ramping up output, its oil minister said on Saturday.

A Nigerian militant group has said it has ended attacks on the nation’s oil and gas industry that have reduced the OPEC member’s output by 700,000 barrels a day to 1.56 million bpd.

But the prospect of a recovery in oil production from Libya happening any time soon was tempered after the head of the country’s National Oil Corp. said budgetary delays from the new government were undermining oil production.

“Oil prices are caught between concerns about oversupply and a strong dollar on the one hand and the prospect of further jawboning from OPEC members that some form of production freeze could be on the cards,” CMC Markets senior analyst Michael Hewson said.

The huge global oil oversupply that has weighed on prices for the past two years may not clear until the second half of 2017, Shell’s (RDSa.L) chief energy adviser Wim Thomas told Reuters.

(Additional reporting by Roslan Khasawneh in Singapore; editing by Jon Boyle)

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Wall Street flat as investors look for clues on rates

Wall Street was little changed on Tuesday morning as investors looked for catalysts to drive the markets while keeping one eye on clues for the timing of the next interest rate hike.

Federal Reserve Chair Janet Yellen painted a rosy picture of the U.S. economy at an economic symposium on Friday and said the case for a rate hike was strengthening, but gave little indication on when the central bank could move.

Fed Vice Chairman Stanley Fischer, in an interview with Bloomberg TV on Tuesday, said the U.S. job market is close to full strength and the pace of interest rate hikes will depend on how well the economy is doing.

Investors are awaiting a report on monthly payrolls data due on Friday to assess whether it supports the hawkish tone that Fed officials have taken.

“I think today is going to be flat to down a little bit, simply because of yesterday’s strong move,” said Brad McMillan, chief investment officer of Commonwealth Financial.

“Investors are going to need some time to digest that. It is a quiet week with a lot of people at the beach.”

The SP 500 and the Dow snapped a three-day losing streak on Monday, helped by a lift in financials and commodity stocks after strong consumer spending data pointed to a pickup in U.S. economic growth.

The dollar index .DXY rose 0.3 percent on Tuesday, continuing to trade at a more than two-week high on higher prospects of a rate increase.

At 9:48 a.m. ET, the Dow Jones industrial average .DJI was down 13.36 points, or 0.07 percent, at 18,489.63.

The SP 500 .SPX was down 0.62 points, or 0.03 percent, at 2,179.76, while the Nasdaq Composite .IXIC was up 1.66 points, or 0.03 percent, at 5,233.99.

Five of the 10 major SP 500 indexes were higher, led by a 0.56 percent rise in the energy sector .SPNY on the back of higher oil prices. [O/R]

Shares of Apple (AAPL.O) fell 0.5 percent to $106.32, after European Union antitrust regulators ordered the iPhone maker to pay $14.5 billion to the Irish government, ruling that a scheme to route profits through Ireland was illegal state aid.

The stock was the top drag on all three major U.S. stock indexes.

Hershey (HSY.N) dropped nearly 11.3 percent to $99.06 after Mondelez (MDLZ.O) announced on Monday it was no longer pursuing an acquisition. Hershey’s was the biggest percentage loser on the SP 500.

American Airlines (AAL.O) fell 1.7 percent after Scott Kirby, its No.2 executive, left the company to join rival United Continental (UAL.N). United’s shares jumped 4.2 percent to $48.91.

Advancing issues outnumbered decliners on the NYSE by 1,541 to 1,114. On the Nasdaq, 1,415 issues rose and 862 fell.

The SP 500 index showed 21 new 52-week highs and no new lows, while the Nasdaq recorded 58 new highs and two new lows.

(Reporting by Yashaswini Swamynathan in Bengaluru)

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