Yokohama, Jun 25 (AP/UNB) — Scandal-battered Nissan won shareholders' approval Tuesday for a new system of committees to oversee governance and for keeping Chief Executive Hiroto Saikawa on its board.
The Japanese automaker had seen profits and dividends tumble amid a high-profile scandal involving its former chairman Carlos Ghosn. Some shareholders expressed worries about the future of the automaker.
Saikawa and the other board members, including French alliance partner Renault Chairman Jean-Dominique Senard, bowed deeply at the meeting at a convention center in the port city of Yokohama, where Nissan Motor Corp. is based.
"I'd like to offer my deepest apologies, representing the company, for how the misconduct has caused serious concern for our shareholders," Saikawa said.
Ghosn, who led Nissan for two decades, was arrested in November and is awaiting trial in Japan on charges of financial misconduct, including falsifying documents related to retirement compensation. He says he is innocent.
The proposals to have committees overseeing compensation, board nominations and auditing required a majority of shareholders for a quorum and two-thirds of those voting for passage.
Approval was shown by clapping among the more than 2,800 people present at the meeting. Most of the votes were submitted in advance.
French automaker Renault, which owns 43% of Nissan, had earlier signaled it may abstain, saying it wanted more representation on the committees.
To satisfy that request, the committees have Senard, who replaced Ghosn on the Nissan board, and Renault Chief Executive Thierry Bollore.
Saikawa told shareholders he had "two kinds of responsibility," for what had happened in the past as well as building toward a future and a recovery, including nurturing his successor.
"I would like to work toward putting Nissan on a stable track," he said, asking for shareholders' approval for his remaining as Nissan's leader. "I want to speed up the preparations for a succession."
Although Nissan has been trying to put the scandal behind it, many have been wondering why the alleged wrongdoing, if true, had gone unchecked, especially how much Saikawa knew. One shareholder asked whether Nissan officials besides Ghosn shared in the alleged misconduct.
For the fiscal year that ended in March, Nissan's profit plunged to about half of what it was the previous year, partly because of the scandal, as well as problems in the lucrative North American market. The maker of the Leaf electric car and Infiniti luxury models is projecting a further deterioration in its earnings, but promising a recovery for the year after that.
It logged 9.2 billion yen ($83 million) in costs for the fiscal year that ended in March from alleged underreporting of Ghosn's compensation.
The proposal, which won shareholders' approval, called for an 11-member board, including seven outside directors such as Andrew House, formerly with Japanese electronics and entertainment company Sony Corp.
For the appointment of directors, a third of the shareholders made for a quorum, and passage needed a simple majority of those voting.
Some analysts suggest a deepening rift between Renault and Nissan after a planned merger between Renault and Fiat Chrysler fell through earlier this month. Nissan expressed reservations about immediately joining the merger.
Some shareholders expressed worries about the alliance, and one who stood up to ask a question said the main person who had made decisions, referring to Ghosn, was now gone.
Nissan held an extraordinary shareholders' meeting in April to oust Ghosn. Last week, Mitsubishi Motors Corp., a smaller Japanese automaker in which Nissan owns a 34% stake, won shareholders' approval to oust Ghosn.
Dhaka, Jun 25 (AP/UNB) - The U.S. stock market capped a day of listless trading with modest losses Monday as investors focused on upcoming trade talks between the U.S. and China.
The major stock indexes drifted between small gains and losses for much of the day, though smaller company stocks had their worst day since May. The losses erased some of the market's solid gains from last week, when the benchmark S&P 500 index closed at an all-time high.
The muted trading came as investors looked ahead to a highly anticipated meeting between the leadership of the U.S. and China later this week. The world's two largest economies have been embroiled in a trade war that has taken the market on a volatile roller-coaster ride this year and Wall Street is hoping for a deal.
"The market right now seems to be pricing in some combination of at least a de-escalation between the U.S. and China from a trade standpoint to the point where it doesn't drive us into a recession," said Michael Crook, head of Americas investment strategy at UBS Global Wealth Management.
The S&P 500 index slipped 5.11 points, or 0.2%, to 2,945.35. The index is about 0.3% below the record high it set on Thursday.
The Dow Jones Industrial Average rose 8.41 points, or less than 0.1%, to 26,727.54. The Nasdaq composite dropped 26.01 points, or 0.3%, to 8,005.70. The Russell 2000 index of smaller companies slid 19.54 points, or 1.3%, to 1,530.08, its biggest single-day loss since May 31.
Major indexes in Europe finished mostly lower.
The market notched its third straight weekly gain last week and is on track for a strong monthly rebound from a steep sell-off in May. The major U.S. stock indexes are up more than 7% so far this month and are holding on to gains of more than 14% for the year.
Investors have been reassured by statements from the Federal Reserve this month that suggest the central bank is prepared to cut interest rates in response to a slowing global economy. Even so, traders remain concerned that corporate profits might suffer should the kind of economic slowdown that would prompt the Fed to cut rates take hold.
Trade policy remains the biggest source of uncertainty looming over the market. Worries about the dispute and its potential impact on global economic growth sent the broader market on a bumpy ride during the second quarter as the tensions escalated.
Presidents Donald Trump and Xi Jinping plan to meet at the Group of 20 summit in Japan, which starts Friday. Wall Street is once again hoping that the two sides can find a path to making a deal that will end their trade war.
The two sides are in a stalemate after 11 rounds of talks that have failed to overcome U.S. concerns over China's acquisition of American technology and its massive trade surplus. China denies forcing U.S. companies to hand over trade secrets and says the surplus is much smaller than it appears.
Health care stocks accounted for a big share of the selling Monday, led by a slide in shares of pharmaceutical giant Bristol-Myers Squibb.
The stock fell after the company said it would divest its blockbuster psoriasis treatment Otezla as part of a push to win regulatory approval for its $74 billion buyout of Celgene. Shares in Bristol-Myers were the biggest decliner in the S&P 500, losing 7.4%. Celgene dropped 5.4%.
Consumer discretionary stocks and banks also helped pull the market lower. Ulta Beauty dropped 2.6% and Capital One Financial dropped 3.1%.
Energy stocks also declined. The sector remains volatile as oil prices fluctuate over concerns about economic growth and rising tensions in the Middle East. Concho Resources fell 3.4%.
Technology companies, consumer goods makers and materials stocks were among the gainers. Western Digital rose 2.5%, Tyson Foods added 1.9% and Newmont Goldcorp gained 2.5%.
Bond prices rose, sending yields lower, as investors continued to shift money into U.S. bonds as a hedge against a possible downturn in the economy or further escalation in trade tensions. The yield on the 10-year Treasury note fell to 2.02% from 2.06% late Friday.
"The pricing in the bond market right now does indicate that it wouldn't take much to create a recession if we had some bad policy mistake either from the Fed or from a trade standpoint," Crook said.
Traders welcomed news that Eldorado Resorts has agreed to buy casino operator Caesars Entertainment in a cash-and-stock deal valued at $17.3 billion.
The deal creates a casino giant with about 60 casinos and resorts in 16 states under a single name. Caesars has been struggling since emerging from bankruptcy in 2017. Billionaire investor Carl Icahn took an enormous stake in the company and pushed for big changes. Caesars surged 14.5% and Eldorado fell 10.6%.
Energy futures finished mixed. Benchmark crude oil rose 47 cents to settle at $57.90 a barrel. Brent crude oil, the international standard, fell 34 cents to close at $64.86 a barrel. Wholesale gasoline fell 1 cent to $1.85 per gallon. Heating oil declined 1 cent to $1.91 per gallon. Natural gas rose 12 cents to $2.30 per 1,000 cubic feet.
Gold rose $18.20 to $1,414.30 per ounce, silver rose 10 cents to $15.37 per ounce and copper was unchanged at $2.71 per pound.
The dollar fell to 107.32 Japanese yen from 107.41 yen on Friday. The euro strengthened to $1.1401 from $1.369.
Beijing, Jun 25 (AP/UNB) — Chinese and U.S. trade negotiators are discussing ways to resolve disputes ahead of a meeting between Presidents Donald Trump and Xi Jinping at the G-20 summit in Japan later this week, a Chinese official said Monday.
The sides were seeking to "consolidate the important consensus reached between the two leaders" in a telephone call last week, Wang Shouwen, a Commerce Ministry vice minister, told reporters. Wang gave no details about specific issues under discussion.
This week's G-20 meeting in Osaka is the first opportunity Trump and Xi have had to thrash out the trade dispute face-to-face since Trump said he was preparing to target the $300 billion in Chinese imports that he hasn't already hit with tariffs, extending them to everything China ships to the United States.
In advance of the Trump-Xi meeting, U.S. Trade Representative Robert Lighthizer spoke by phone Monday with the top Chinese negotiator, Vice Premier Liu He, according to a spokesperson for the Trade Representative's office who did not have further details of the discussions.
Trump has already imposed 25% tariffs on $250 billion in Chinese imports and China has retaliated with tariffs on U.S. goods.
The two sides are in a stalemate after 11 rounds of talks that have failed to overcome U.S. concerns over China's acquisition of American technology and its massive trade surplus. China denies forcing U.S. companies to hand over trade secrets and says the surplus is much smaller than it appears once the trade in services and the value extracted by U.S. companies are taken into account.
Stepping up the pressure on Beijing, the U.S. Commerce Department has effectively barred U.S. companies from selling or transferring technology to Huawei Technologies, the world's biggest maker of network gear, No. 2 smartphone manufacturer and a champion of Chinese industry.
Washington claims Huawei poses a national security threat because it may be beholden to China's ruling Communist Party. However, American officials have presented no evidence of any Huawei equipment serving as intentional conduits for espionage by Beijing.
Huawei's placement on the U.S. government's Entity List is widely seen as intended to persuade resistant U.S. allies in Europe to exclude Huawei equipment from their next-generation wireless networks, known as 5G.
Responding to a question about whether it would be best for all 5G devices sold in the U.S. to have been made outside of China, Chinese foreign ministry spokesman Geng Shuang said Americans seemed to be conjuring up non-existent threats.
"I want to tell individuals in the U.S. that they have been living in a panic made by themselves, and they have reached a state of extreme nervousness in which they even apprehend danger in every sound," Geng said.
Globalization has brought an "unprecedented" level of division of labor across borders and societies, reducing the significance of where products are manufactured and assembled, Geng said.
"Against such a backdrop, any attempt to achieve 'absolute security and controllability' by isolating oneself is nothing but fool's talk," Geng said.
China has responded to U.S. pressure by saying it would issue a list of "unreliable entities" targeting companies that "violated market principles" and cut supplies of components to Chinese businesses for non-commercial reasons.
Beijing has also suggested it might limit exports of rare earths, minerals such as lithium that are used in many products including cellphones, electric vehicles and the batteries that run them.
Dubai, 24 (AP/UNB) — U.S. Secretary of State Mike Pompeo held talks Monday with leaders in Saudi Arabia and the United Arab Emirates about countering the military threat from Iran by building a broad, global coalition that includes Asian and European countries.
While Pompeo has seemingly willing and wealthy partners in the two Arab allies, he is likely to face a tough sell in Europe and Asia, particularly from those nations still committed to the 2015 nuclear deal with Iran that President Donald Trump repudiated last year.
With tensions running high in the region after Iran shot down a U.S. surveillance drone on June 20 and Trump said he aborted a retaliatory strike, Iran's naval commander warned that his forces won't hesitate to down more U.S. drones that violate its airspace. The U.S. has been building up its military presence in the Persian Gulf.
The U.S. announced additional sanctions Monday on Iran aimed at pressuring the Iranian leadership into talks. The sanctions, re-imposed after Trump withdrew from the nuclear deal, have crippled the Iranian economy and pushed up the cost of living. Iran has decried U.S. sanctions, which essentially bar it from selling its oil internationally, as "economic terrorism."
After departing Saudi Arabia, where he met King Salman and Crown Prince Mohammed bin Salman, Pompeo met in the UAE with Abu Dhabi Crown Prince Mohammed bin Zayed to sell the Trump administration's idea for maritime security in the Persian Gulf. The plan would involve the UAE, Saudi Arabia and another 20 countries, Pompeo was heard telling the Abu Dhabi prince.
"We'll need you all to participate, your military folks," Pompeo told the Abu Dhabi prince in the presence of some reporters traveling with him. "The president is keen on sharing that the United States doesn't bear the cost of this."
While in Saudi Arabia earlier, Pompeo tweeted that he'd had a "productive meeting" with the Saudi monarch and discussed "heightened tensions in the region and the need to promote maritime security" in the Strait of Hormuz.
Pompeo, considered a hard-liner in Washington, referred to Iran as "the world's largest state sponsor of terror" before he embarked on the hastily arranged Middle East stops en route to India, Japan and South Korea.
He said he'd be speaking with leaders in Saudi Arabia and the UAE "about how to make sure that we are all strategically aligned, and how we can build out a global coalition ... not only throughout the Gulf states, but in Asia and in Europe" that is prepared to push back against Iran.
But Germany, France and Britain, as well as Russia and China, remain part of the nuclear accord that lifted sanctions on Iran in exchange for set limits on its uranium enrichment levels. Trump pulled the U.S. out of the deal last year.
Germany, Britain and France have sent envoys to Tehran recently, signaling they remain committed to diplomacy and dialogue. They cautioned against moves that can lead to conflict between the U.S. and Iran.
Berlin appears cool toward U.S. talk of a global coalition against Iran as it tries to salvage the nuclear deal. German media have drawn parallels between Pompeo's talk of a coalition and President George W. Bush's "coalition of the willing" against Iraq in 2003, which Germany and France opposed.
German Foreign Ministry spokesman Christofer Burger said his country had "taken note via the media" of Pompeo's comments and that Germany's "top aim is and remains a de-escalation of the serious situation."
On Monday, Trump tweeted that China and Japan depend on the security of the Persian Gulf waterways for the bulk of their oil imports, and he asked why the U.S. is protecting the shipping lanes for other countries "for zero compensation."
"All of these countries should be protecting their own ships on what has always been a dangerous journey." He said the U.S. doesn't "even need to be there" because it produces much of its own energy needs.
Brian Hook, the U.S. special envoy for Iran, said one option could be to "enhance" an existing multinational maritime force of about 30 countries that currently fights drug and arms smuggling in the region.
Alternatively, he said allied nations with commercial interests in the oil-rich region could launch an all-new maritime security initiative.
Another option could be military ships patrolling the Gulf waters and equipped with surveillance equipment to keep watch on Iran.
The narrow Strait of Hormuz, which lies between Iran and Oman and opens to the Persian Gulf, is paramount for Asian oil importers. An estimated 18 million to 20 million barrels of oil — much of it crude — pass through the strait every day.
The U.S. Navy, which has its 5th Fleet based in Bahrain to protect the strait, escorted oil tankers to ensure American energy supplies in the 1980s when Iran and Iraq were targeting each other's exports, but the U.S. is no longer as reliant on Arabian producers.
Today, any conflict that threatens tankers would badly disrupt crude supplies for energy-hungry countries like China, Japan, South Korea, Singapore and Indonesia, which are among the top five importers of Arabian oil.
Pompeo's Mideast stops may also be aimed at reassuring Washington's Sunni Gulf Arab allies that the White House remains committed to keeping pressure on Shiite Iran following Trump's decision against retaliation, which likely raised questions about U.S. willingness to use force against the Islamic Republic. On a visit to Israel on Sunday, U.S. National Security Adviser John Bolton, also considered a U.S. hard-liner, said Iran should not "mistake U.S. prudence and discretion for weakness."
Iran's naval commander, Rear Adm. Hossein Khanzadi, declared that Tehran is capable of shooting down other American spy drones that violate its airspace, saying "the crushing response can always be repeated." He spoke during a meeting of defense officials in Iran.
Trump has wavered between bellicose language and actions toward Iran and a more accommodating tone, including an offer for negotiations. Iran has said it is not interested in a dialogue with Trump.
Saudi Arabia and the U.S. accused Iran of being behind attacks on tankers near the Persian Gulf in recent weeks, while the UAE has been urging diplomacy to avert a wider conflict.
On the eve of Pompeo's visit to the kingdom, Yemen's Iranian-allied rebels attacked a Saudi airport near the Saudi-Yemen border, killing a Syrian resident and wounding 21 other civilians, the Saudi military said.
The Houthi rebels claimed they used bomb-laden drones to attack the Abha airport, the second in less than two weeks. Drones were also used against a Saudi oil pipeline last month.
In a statement, Pompeo condemned the Abha airport attack and said the war in Yemen is not an isolated conflict. He accused Iran of funneling cash, weapons, and armed support to the Houthis, which Iran denies.
Saudi Arabia has been at war with the rebel Houthis in Yemen for more than four years. The Houthis say the attacks are a response to relentless Saudi airstrikes on Yemen that have killed thousands.
Berlin, June 24 (AP/UNB) — European officials on Monday appeared cool toward U.S. talk of building a global coalition against Iran, with the German foreign minister warning that "maximum pressure" without diplomacy increases the risks of a war and several others stressing that their priority is to de-escalate tensions in the Middle East.
The split over Iran comes amid deepening divisions between the United States and Europe over foreign policy and trade, with the allies appearing to talk past each other on a matter that both view as a crucial security issue.
U.S. Secretary of State Mike Pompeo, visiting Middle Eastern allies Saudi Arabia and the United Arab Emirates, said he would discuss "how we can build out a global coalition" against Tehran that also includes countries in Asia and Europe, describing Iran as "the world's largest state sponsor of terror."
German Foreign Ministry spokesman Christofer Burger said Berlin had "taken note via the media" of Pompeo's comments on a coalition, a formulation that indicated his country had yet to be asked to join directly. He added that "our top aim is and remains a de-escalation of the serious situation," pointing to contacts at various levels with the U.S. and noting that various representatives of the three European countries have recently been in Tehran.
Germany, France and Britain, along with Russia and China, remain part of the nuclear deal that U.S. President Donald Trump's administration abandoned last year. The 2015 agreement aimed at curbing Iran's nuclear ambitions in exchange for relief from economic sanctions.
Germany argues that the agreement, beyond ensuring that Iran doesn't produce nuclear weapons, also helps keep open lines of communication with Tehran to address other concerns about its behavior in the Middle East.
On Sunday, German Foreign Minister Heiko Maas doubled down on criticism of the Trump administration's strategy of "maximum pressure" against Tehran, which is weighing heavily on Iran's economy.
"The strategy of maximum pressure can't be the right one, because one of the consequences is that we are all talking about how serious the situation is, and that there is a danger of war," he told ZDF television.
"This is the time for diplomacy," he added. "We have to ensure that these tensions are reduced, because otherwise any event — without it being clear who caused it — could lead to ... a spiral of violence that ends in a war."
The point was echoed by the spokeswoman for European Union foreign policy chief Federica Mogherini, one of the guarantors of the 2015 agreement.
Asked about the U.S. call for a coalition against Iran, spokeswoman Maja Kocijancic said that "exclusively diplomatic routes are needed to resolve differences. The EU is ready to work with partners to take this forward."
She added that "the latest developments underline the urgent need for restraint, for open channels of dialogue and for immediate de-escalation."
Maas recently traveled to Tehran, Britain sent a Foreign Office minister there and France sent President Emmanuel Macron's chief diplomatic adviser.
Speaking on the sidelines of a Mediterranean summit in Marseille, Macron urged that diplomacy prevail.
The leaders of the three European countries will have a chance to discuss Iran directly with Trump at the Group of 20 summit in Japan that starts Friday, and Macron said he would take that opportunity to do so.
"We must find a constructive solution with one objective, which is the collective security of the region," he said.
British Foreign Secretary Jeremy Hunt, who is also campaigning to lead the Conservative Party and become the new prime minister, told the Daily Mail newspaper over the weekend that "we will stand by the United States as our strongest ally, but of course we have to consider any requests for military support on a case-by-case basis."
He said that "we want to de-escalate the situation but we are of course extremely worried."
Macron's office hasn't commented on the outcome of the presidential adviser's visit to Iran. On Friday, Macron said that he was "calling on all parties to be reasonable and keep talking."
On Monday, Brian Hook, the U.S. special envoy for Iran, said Washington wants partners to join forces to increase maritime security in the Persian Gulf. He said one option could be to "enhance" an existing multinational maritime force in the region involving about 30 countries — several of them in Europe — that fights drug and arms smuggling.
The Europeans' diplomatic balancing act faces severe pressure from the Iranian side as well. On Friday, officials from Iran and the remaining parties to the nuclear deal are due to hold a regular meeting in Vienna, with Tehran saying that it expects to exceed the uranium stockpile limit set by the agreement this week.
Iran also has set a July 7 deadline for Europe to come up with better terms for it to stay in the accord. If that deadline passes without any action, President Hassan Rouhani has said the Islamic Republic likely will resume higher uranium enrichment. The Europeans are trying to implement a complicated barter-type system known as INSTEX to keep up trade with Iran.
The Europeans are insisting Iran stick to its obligations under the deal in full, with German Chancellor Angela Merkel saying that if Tehran doesn't abide by the accord, "that will of course have consequences." Officials won't elaborate on what exactly would happen.