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Yearly Archives: 2018

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Business: Asian shares advance as US bond yields push dollar higher

TOKYO (AP) — Asian shares were mostly higher Tuesday as a surge in U.S. bond yields pushed the value of the dollar higher against other major currencies.

KEEPING SCORE: Japan’s benchmark Nikkei 225 gained 0.7 percent in morning trading to 22,236.53, helped by the weaker yen. Australia’s S&P/ASX 200 climbed 0.5 percent to 5,916.40, and South Korea’s Kospi lost 0.3 percent to 2,467.81. Hong Kong’s Hang Seng added 1.1 percent to 30,580.16, while the Shanghai Composite jumped 2.2 percent to 3,131.52, recouping losses from the previous day. Shares were mixed in Southeast Asia.

WALL STREET: Shares yielded early gains to end nearly unchanged. The S&P 500 index ended almost flat at 2,670.29. The Dow Jones industrial average fell less than 0.1 percent to 24,448.69. The Nasdaq composite gave up 0.2 percent to 7,128.60. The Russell 2000 index of smaller-company stocks declined 0.1 percent, to 1,562.12.

U.S. BOND YIELDS: The yield on the 10-year Treasury note drew close to 3 percent on Monday, a milestone it has not reached since January 2014. It touched 2.98 percent but by early Tuesday in Asia had fallen back to 2.96 percent. The 10-year yield stood at 2.43 percent at the end of 2017. Since the global financial crisis in 2008-09, a combination of low inflation expectations and a bond-buying program by the Federal Reserve have helped keep bond yields low but they have climbed this year as inflation has picked up and the Federal Reserve raised interest rates. With the Fed no longer buying bonds and investors expecting greater inflation, analysts say higher yields could make bonds more attractive than stocks. They also make U.S. dollars relatively more attractive.

THE QUOTE: “The U.S. dollar has put on a compelling show overnight as the stars align on the back of higher U.S. yields and a considerable reduction in the U.S. dollar’s geopolitical risk premium as an outwardly calmer mood surrounding trade and geopolitical risk takes hold,” Stephen Innes of OANDA said in a commentary.

ENERGY: Benchmark U.S. crude oil gained 29 cents to $68.93 a barrel. It rose 0.4 percent to $68.64 a barrel in New York. Brent crude, used to price international oils, gained 22 cents to $74.93 per barrel in London.

CURRENCIES: The dollar rose to 108.77 yen from 108.71 yen. The euro fell to $1.2213 from $1.2233.

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– Here are the top five things you need to know in financial markets on Tuesday, April 24:

1. U.S. Stock Futures Point To Rebound

U.S. stock futures pointed to a higher open, with the Dow set to snap a four-day losing streak, as investors looked ahead to the latest deluge of corporate earnings.

The blue-chip Dow futures rose 100 points, or about 0.4%, the S&P 500 futures added 12 points, or nearly 0.5%, while the tech-heavy Nasdaq 100 futures climbed 36 points, or roughly 0.6%.

U.S. stocks fell on Monday, as tech shares declined, while investors fretted over higher interest rates.

Elsewhere, in Europe, the continent’s major bourses edged higher, as rising oil prices buoyed shares in the energy sector.

Earlier, in Asia, markets in the region closed mostly higher, following two straight days of declines.

2. Blue Chip Earnings In Focus

The busy week for corporate earnings kicks into high gear today, with a number of blue chips reporting earnings this morning, including Coca-Cola (NYSE:KO), Caterpillar (NYSE:CAT), 3M (NYSE:MMM), Travelers (NYSE:TRV), United Technologies (NYSE:UTX) and Verizon (NYSE:VZ).

Biogen (NASDAQ:BIIB), Eli Lilly (NYSE:LLY), Lockheed Martin (NYSE:LMT), Corning (NYSE:GLW), Freeport-McMoran (NYSE:FCX), PulteGroup (NYSE:PHM), Sherwin-Williams (NYSE:SHW) and JetBlue (NASDAQ:JBLU) also report.

After the closing bell, Wynn Resorts (NASDAQ:WYNN), Amgen (NASDAQ:AMGN), Chubb (NYSE:CB), Texas Instruments (NASDAQ:TXN), Cree (NASDAQ:CREE) and Hawaiian Holdings (NASDAQ:HA) report.

Alphabet (NASDAQ:GOOGL) earnings will also be in focus, after its stock dipped slightly in volatile after-hours trading following its earnings release; the company reported a 73% jump in profits in the first quarter.

3. Dollar Stands Tall Near 1-1/2 Month Highs

The dollar rose to a fresh one-and-a-half-month high against a basket of major currencies in early action, supported by expectations that the Federal Reserve would raise interest rates three more times in 2018.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was a shade higher at 90.72, after hitting an overnight peak of 90.85, the strongest level since March 1.

The dollar hit ten-week highs against the safe haven yen, with USD/JPY rising to 108.91.

The euro was near seven-week lows, with EUR/USD last at 1.2204 after plumbing an overnight nadir of 1.2185.

Sterling was also lower, with GBP/USD trading at one-month lows 1.3930.

On the data front, investors will be watching a few economic reports, including S&P/Case-Shiller home prices and FHFA home prices, both at 9:00AM ET (1300GMT).

There are also new home sales and consumer confidence both due at 10AM ET (1400GMT).

4. U.S. 10-Year Treasury Yield Inches Away From 3%-Mark

U.S. Treasury yields halted their recent march higher, with the benchmark 10-year note inching away from the psychologically important 3%-threshold.

It was last at 2.964%, down 0.9 basis points, or 0.3%, after reaching an intraday peak of 2.998% on Monday, a level not seen since January 2014.

The 10-year yield has not been above 3% – the point at which strategists and fund managers say equities will really hurt – since early 2014.

Meanwhile, the yields on the Fed-sensitive 2-year and 5-year notes were also lower, one day after touching their loftiest levels in around 10 years.

The recent bounce in yields came as strengthening inflation prospects added to expectations of a more hawkish approach from the Federal Reserve this year.

5. Oil Holds Near Recent Highs Ahead Of API Supply Data

Crude prices held near their strongest level in three years, as investors looked ahead to fresh data on U.S. commercial crude inventories to gauge the strength of demand in the world’s largest oil consumer and how fast output levels will continue to rise.

Industry group the American Petroleum Institute is due to release its weekly report at 4:30PM ET (2030GMT).

New York-traded WTI crude futures rose 30 cents, or about 0.5%, to $68.95 per barrel, while Brent futures gained 20 cents, or roughly 0.3%, to $74.92 per barrel.

The global benchmark climbed as high as $75.27 earlier in the session, a level not seen since Nov. 27, 2014, boosted by geopolitical tension in the Middle East and concerns about supply disruptions in key oil-producing nations.

Canada police say driver that hit pedestrians in custody

This gallery contains 1 photo.

TORONTO (AP) — A van apparently jumped onto a sidewalk Monday at a busy intersection in Toronto and struck down pedestrians before the vehicle was found and the driver taken into custody, Canadian police said.

Authorities said at least seven people were hospitalized with injuries, while a photo from the scene showed an apparent body on the sidewalk, but police did not immediately provide details on casualties. CTV News said at least four of the hospitalized victims were in critical condition.

It was not immediately clear what caused the van to strike the pedestrians in the north-central part of the city. Police did not immediately identify the driver.

“At this point it’s too early to tell what if any motive there was. We are also unable right now to tell the extent or the number of persons injured,” Toronto police spokeswoman Meaghan Gray said.

A witness, Phil Zullo, told Canadian Press that he saw police arresting a man who had been driving a Ryder rental truck and saw people “strewn all over the road” where the incident occurred.

“I must have seen about five, six people being resuscitated by bystanders and by ambulance drivers,” Zullo said. “It was awful. Brutal.”

Toronto paramedic spokeswoman Kim McKinnon said first responders were treating multiple patients, but wouldn’t confirm the number or severity of injuries.

Police shut down the Yonge and Finch intersection following the incident and Toronto’s transit agency said it has suspended service on the subway line running through the area.

The incident occurred as Cabinet ministers from the major industrial countries were gathered in Canada to discuss a range of international issues in the run-up to the G7 meeting near Quebec City in June.

Prime Minister Justin Trudeau expressed his sympathies for those involved. “Our hearts go out to everyone affected,” Trudeau said in Ottawa. “We are going to have more to learn and more to say in the coming hours.”

World watching 2 North Korea summits for signs of nuke deal

SEOUL, South Korea (AP) — When North Korean leader Kim Jong Un meets South Korean President Moon Jae-in on Friday, the world will have a single overriding interest: How will they address North Korea’s decades-long pursuit of nuclear-armed missiles?

Success, even a small one, on the nuclear front could mean a prolonged detente and smooth the path for a planned summit between Kim and President Donald Trump in May or June. Optimists hope the two summits might even result in a grand nuclear bargain.

North Korea’s announcement on Saturday to suspend further nuclear and intercontinental ballistic missile tests and close its nuclear test site raised hopes in Washington and Seoul for a breakthrough in the upcoming nuclear negotiations. However, the North’s statement stopped well short of suggesting it has any intentions to give up its nukes or halt its production of missiles.

Failure to reach a nuclear agreement would raise serious questions about the sincerity of Kim’s recent outreach to Seoul and Washington and rekindle the fears of war that spread across the Korean Peninsula last year.

A look at the prospects of a North Korean disarmament deal ahead of the two impending summits:

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INTER-KOREAN SUMMIT

Although North Korea has expressed a willingness to have “candid” talks with the United States about the denuclearization of the peninsula, there’s rampant skepticism about whether Kim will give up his nukes.

Those weapons are the core of his authoritarian rule, a “powerful treasured sword” meant to neutralize U.S. nuclear threats. And the North’s call for “the denuclearization of the Korean Peninsula” has been linked to a demand for the withdrawal of the 28,500 U.S. troops in South Korea.

Kim suggested during a trip to Beijing in March that he prefers step-by-step disarmament in return for corresponding concessions. That, critics say, could allow the North to covertly continue its weapons programs while winning badly needed aid, which occurred during now-dormant six-nation nuclear talks from 2003 to 2008.

Analysts say it’s likely that Kim will make similar commitments during the inter-Korean summit as a way of reaching out to the United States. Go Myong-Hyun of the Seoul-based Asan Institute for Policy Studies said Kim may also offer up a rough timetable for denuclearization.

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NORTH KOREA-US SUMMIT

North Korea argues that it needs its nukes because of the U.S. military presence in South Korea and annual U.S.-South Korean military exercises that the North claims are an invasion rehearsal.

During the two summits, Kim may demand a security guarantee for his government, the scrapping of what he calls U.S. hostility and the easing or lifting of international sanctions on the North. The Kim-Trump meeting, not the Korean summit, will be the main venue for dealing with nukes because the United States must largely determine whether to accept the North’s demands.

Kim, therefore, has an interest in making his meeting with Moon a success, especially following reconciliation in recent months that saw athletes from both countries parade together during the Pyeongchang Winter Olympics opening ceremony and South Korean pop stars perform in Pyongyang.

It’s much less clear how the Kim-Trump meeting will go. Trump’s pick for secretary of state, Mike Pompeo, said recently that “no one is under any illusions that we will reach a comprehensive agreement.” Pompeo made a secret trip to meet with Kim and discuss the summit in recent weeks.

Trump seemed more optimistic after North Korea’s announcement on Saturday, to which he responded with a tweet saying, “This is very good news for North Korea and the World” and “big progress!” He added that he’s looking forward to his upcoming summit with Kim.

U.S. officials have said they want complete, verifiable and irreversible disarmament by North Korea. Kim won’t likely accept that anytime soon because he’s closing in on his goal of developing nuclear missiles capable of striking the continental U.S. after decades of struggle and sacrifice.

After his country’s most-powerful-to-date long-range missile test in November, Kim said the North had “finally realized the great historic cause of completing the state nuclear force.” Foreign experts, though, say the North still has a couple of technological barriers to overcome to build reliable intercontinental ballistic missiles.

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WHAT KIND OF DEAL?

One disarmament step Kim might have in mind is to freeze or dismantle an ICBM program that poses a direct threat to the United States. Go said Kim could also offer to allow international nuclear inspectors back into his country and promise to dismantle the North’s old plutonium-producing reactor at its main nuclear complex because it has a uranium-enrichment plant that can also manufacture bombs.

North Korea could also submit a list of facilities or equipment to be disabled or dismantled and then allow the United States to inspect disarmament procedures. This process, however, could easily be disrupted if the North asks for excessive rewards for partial disarmament steps or the country fails to let outsiders inspect military bases or other sensitive places with possible nuclear weapons.

Kim Taewoo, a former president of the Korea Institute for National Unification, also warned that a deal freezing the North’s nuclear capability at current levels or scrapping an ICBM program while leaving intact shorter-range missiles that place South Korea within striking distance won’t change security threats South Korea faces. The North already likely has the technology to mount atomic warheads on shorter-range missiles targeting South Korea and Japan.

He said the two upcoming summits are a “huge gamble” for all three leaders if they don’t produce a breakthrough. If the summits fail, the world won’t tolerate any future Kim Jong Un charm offensive because of a belief that he tried to use the summits to weaken sanctions or buy time to perfect his nuclear program. Trump would be seen as being duped. And Moon would have to choose whether to risk undermining ties with Washington by continuing to improve ties with North Korea.

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Follow Hyung-jin Kim at www.twitter.com/hyungjin1972

US brands suffer collateral damage in Chinese corporate war

SHANGHAI (AP) — It was looking like a banner year for business in China. The U.S. clothing company was expecting a 20 percent jump in online sales on Alibaba’s Tmall, thanks to the e-commerce giant’s massive reach.

But executives soon learned that what Alibaba gives, it can also take away.

The company refused to sign an exclusive contract with Alibaba, and instead participated in a big sale promotion with its archrival, JD.com Inc. Tmall punished them by taking steps to cut traffic to their storefront, two executives told The Associated Press. They said advertising banners vanished from prominent spots in Tmall sales showrooms, the company was blocked from special sales and products stopped appearing in top search results.

The well-known American brand saw its Tmall sales plummet 10 to 20 percent for the year.

“Based on our sales record, we should have been in a prominent position, but we were at the bottom of the page,” said the brand’s e-commerce director, who spoke only on condition of anonymity for fear of further retaliation. “That’s a clear manipulation of traffic. That’s a clear punishment.”

As the Trump administration pushes China to play by fair trade rules, companies are caught in a quieter but no less crucial struggle for rules-based access to a $610 billion online marketplace, an AP investigation has found.

Executives from five major consumer brands told the AP that after they refused to enter exclusive partnerships with Alibaba, traffic to their Tmall storefronts fell, hurting sales. Three are American companies with billions in annual sales that rely on China for growth.

Alibaba Group Holding Ltd. denied punishing the companies.

In a statement, Alibaba said pursuing exclusive deals is a common industry practice and called the charges of coercion “completely false.”

“Alibaba and Tmall conduct business in full compliance with Chinese laws,” Alibaba said. “Like many e-commerce platforms, we have exclusive partnerships with some of the merchants on Tmall. The merchant decides to choose such an arrangement because of the attractive services and value Tmall brings to them.”

The executives spoke to the AP only on condition of anonymity for fear of reprisals, but their concerns were echoed by a U.S. industry group, brand consultants and policy makers in China and JD.com itself.

In a speech about cyberspace last week, Chinese president Xi Jinping said ensuring free and fair competition online was a regulatory priority, citing the need “to cultivate a fair market environment, strengthen intellectual property protection, and oppose monopoly and unfair competition,” state media reported.

In its months-long investigation, the AP interviewed more than 30 people and reviewed two contracts from Alibaba that contained previously unreported exclusivity clauses. The AP found that the platforms that control access to Chinese consumers online wield such enormous power that even multibillion-dollar foreign companies can have trouble fighting back.

“We urge the authorities to quickly investigate and take steps to ensure such practices are eliminated from the growing Chinese marketplace,” said Stephen Lamar, executive vice president of the American Apparel & Footwear Association, adding that members of his industry group had complained about unfair competitive practices by Alibaba.

JD.com is a member and sponsor of the trade group.

Imagine a company twice as profitable as Amazon that each year serves more people than live in all of North America. That’s Alibaba. It claims to be the marketplace for nearly $550 billion a year in sales — more than is sold online in the entire U.S. economy.

The trials of the affected companies offer a rare window onto a bruising business culture forged in China that could spread as Alibaba takes its aggressive, innovative and hugely profitable model of e-commerce global. To the extent that their products are manufactured in the United States — and some are — constricting sales in China’s critical growth market can also deepen the imbalance of trade between China and the U.S., a gap that is a top concern for the Trump administration.

The competition between Alibaba and JD.com is so infamous in China — and so dirty — it’s been dubbed the “great cat-and-dog war,” after Tmall’s black-cat mascot and JD.com’s white dog.

Wang Hongbo, a consultant who helps Chinese brands sell online abroad, echoed the problems cited by the companies who spoke to AP.

“Many brands complained about this to us. Because they didn’t fall in line, they faced restrictions on Tmall,” he said.

JD.com said that over 100 Chinese brands defected last year due to pressure from its main rival, an assertion Alibaba and some brands have contested. The exodus appears to have had a lasting impact.

“Based on the feedbacks we received from these merchants, the move was mainly due to the coercive tactics from our competition, which if proven true would be illegal and clearly against the merchants’ will,” said Sidney Huang, JD.com’s chief financial officer, said in a November earnings call.

Peacebird, a Chinese fashion company, is among those that left JD.com last year. But Weng Jianghong, the company’s general manager of e-commerce, said Alibaba had not coerced them and the decision to focus on Tmall was strategic.

“We will centralize and develop the limited resources of our company on Tmall,” he said.

Many companies, including JD.com, do exclusive deals. However, JD.com maintains that it doesn’t strategically push merchants for exclusivity.

“We support fair and open competition because greater choice is always better for brands and users,” JD.com said in a statement. “We are winning over customers by providing a superior shopping experience, rather than by limiting the options of brands or consumers.”

JD.com is still trying to get brands to return. “We do believe there will be more merchants coming back,” Huang said in a call last month with analysts. “But I do not expect a very quick fix.”

PLAY OR PAY

Tmall controlled six of every 10 dollars spent overall for business-to-consumer sales online in China in the second half of last year — and even more for sectors like apparel — giving it enormous power over companies that rely on Alibaba for access to Chinese consumers online.

Source: Analysys Ltd. (AP Graphic/Peter Hamlin).

The contracts reviewed by AP offered a suite of benefits in exchange for exclusivity. One contract specified that brands must not operate storefronts on other e-commerce platforms without Tmall’s written permission. The other contract mandated that new products not be launched on competing platforms and barred brands from sales promotions on other platforms without Tmall’s written permission.

Such sales events are the lifeblood of online commerce in China. The country’s massive Singles Day promotion in November, which started as an anti-Valentine’s Day gimmick, is now the world’s largest e-commerce event. Last year, Alibaba said $25 billion worth of merchandise was sold on its platforms alone, compared with just $14.5 billion in total online sales in the U.S. for Thanksgiving Day, Black Friday and Cyber Monday combined, according to data from Adobe Systems Inc.

Brands cited commercial, ideological and legal reasons for refusing to cut off business with JD.com.

Some said that different people shop in different ways on JD.com and Tmall, so cutting off JD.com means cutting off access to a pool of potential shoppers.

“It’s clear from the data we look at these are distinct consumer pools,” said the China head of a publicly-traded company. “If I lost the JD business I would lose a certain part of that business. Another part is on principle: This is blatant anticompetitive behavior.”

Others cited legal concerns. “We didn’t want to go for it in part because we thought it might be an illegal agreement in restraint of trade,” said an executive for a second publicly-traded company.

“We’re chided when we participate in promotional events on other platforms,” he added. “What’s never said but actually happens when we don’t cooperate in the way they want us to is our traffic falls. It’s not a coincidence.”

Two companies said they granted concessions to Alibaba, agreeing to exclusive product launches, raising their prices on JD.com, or removing ads promoting JD.com sales. Traffic to their Tmall shops rebounded. One company said it ultimately closed its flagship on JD.com to salvage Tmall sales.

“You have to go beg,” said the China director of a multi-billion dollar publicly-traded company.

THE GREAT CAT-AND-DOG WAR

Tmall and JD.com have different business models but they are increasingly pushing onto each other’s turf.

Alibaba’s online marketplaces connect buyers and sellers. Alibaba earns money from advertising, as well as commissions and fees. JD.com runs a similar marketplace but, like Amazon, also buys products from brands, then sells and distributes the merchandise itself.

Alibaba has taken aim at JD.com’s long-standing dominance in electronics, while JD.com hopes to cut into Tmall’s core apparel category. Both have expanded into groceries and poured hundreds of millions of dollars into acquisitions to extend their reach into brick-and-mortar businesses.

The result is an escalating turf fight that carries a chilling message for brands: Either you’re with us or against us. The Chinese have a name for this unwritten rule, “er xuan yi,” choose one of two.

“‘Choose one of two’ is a tacit understanding that has been reached by everyone, but you do not say it directly,” said Zhuo Saijun, who until 2015 was a general manager of e-commerce research at Analysys Ltd., a Beijing-based big data consultancy. “This is certainly a problem for the development of retail sales channels. It is a business ethics problem, and this is how monopolies develop.”

Some policymakers have raised concerns about monopolistic tendencies in Chinese e-commerce and called for more effective regulation and enforcement.

“Unfair competition still exists,” Wang Bingnan, a deputy director at China’s Ministry of Commerce, said in a June speech about China’s e-commerce market. “Behaviors like forced ‘choose one of two,’” he added, “are hard for regulators to define, prove or deal with accurately.”

It’s not clear whether Alibaba’s actions would be illegal, nor is it certain that the evidence of coercion that brands have managed to collect would hold up in court. Under China’s anti-monopoly laws, companies that dominate a market cannot demand exclusivity without justification. A 2015 regulation also specifically bars e-commerce platforms from restricting brands’ participation in promotions on other platforms.

The rules are designed to prevent dominant players from squeezing out the competition, which could ultimately hurt both brands and consumers by giving a single, monopolistic player absolute control over prices.

JD.com has complained about anticompetitive tactics before. In 2015, the company filed a complaint with the State Administration for Industry and Commerce, a corporate regulator, accusing Alibaba of pressuring brands into doing exclusive Singles Day sales promotions — a charge Alibaba denied. The complaint was kicked to a regional office in Zhejiang province, where Alibaba has its headquarters.

Nothing more was ever heard about it.

The regulators did not respond to requests for comment.

Alibaba said that while JD.com focuses “on groundless complaints to explain why they are losing brands, we at Alibaba are squarely focused on making our platform the best for our merchants.”

MR. MA GOES GLOBAL

The battles now being waged within China’s e-commerce sector could well impact the culture and norms of e-commerce globally — at least if Alibaba’s chairman, Jack Ma, has his way.

Alibaba aims to serve 2 billion consumers by 2036 — or about one in four people now on the planet. Already, the value of goods sold on Alibaba’s platforms in fiscal year 2017 was $547 billion, larger than the gross domestic product of Sweden.

In June, Ma told investors that his company will rank as the fifth largest economy in the world. “Just say USA, China, Europe, maybe Japan and us,” Ma said.

The company has been aggressively recruiting foreign brands to sell on its platforms, and they have come, in droves. Alibaba said it signed up 60,000 international brands for its massive Single’s Day sale in November, up from 5,000 in 2015.

Alibaba’s retail sales outside of China also are growing fast — they more than doubled last fiscal year to 7.3 billion yuan ($1.1 billion), or 5 percent of total revenue.

America remains at the heart of Ma’s ambition. He told president-elect Donald Trump in Jan. 2017 that he would create a million U.S. jobs by facilitating trade between businesses in the U.S and consumers in China — a pledge he now says is imperiled by the brewing trade war between the two countries.

Brands now caught in the great cat and dog war have adopted different strategies to avoid becoming collateral damage.

An e-commerce manager at a major European brand said she’d be happy to offer totally different products on Tmall and JD.com to stay out of trouble, but worries her bosses won’t go for it because it cuts off potential buyers.

Sometimes, she said, it feels “like we’re working for those platforms.”

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Associated Press writer Anne D’Innocenzio in Las Vegas and researchers Si Chen and Fu Ting in Shanghai contributed to this report.

Follow Kinetz on Twitter at www.twitter.com/ekinetz

Send news tips, documents, etc. securely and confidentially to AP at https://securedrop.ap.org/

Pompeo facing rare opposition from Senate panel

WASHINGTON (AP) — President Donald Trump’s nominee for secretary of state, Mike Pompeo, is facing serious opposition before the Senate Foreign Relations Committee, which may not have enough votes to recommend him for confirmation because all Democrats, and at least one Republican, have said they will oppose him.

The full Senate is still expected to consider Pompeo’s nomination later this week. But the rare rebuke expected from the panel Monday, even after Pompeo’s recent visit with North Korean leader Kim Jong Un, would be the first time in years that a nominee for the high-level Cabinet position did not receive a favorable committee vote.

Sen. Bob Corker, R-Tenn., the chairman of the committee, blamed partisan politics for opposition to Pompeo, now the CIA director, saying Pompeo is just as qualified as past secretaries of state nominees Hillary Clinton or John Kerry, both of whom received overwhelming support.

“We are in an era where somebody like this, who is qualified, unfortunately, is likely to be voted out without recommendation or with a negative recommendation,” Corker said Sunday on “State of the Union” on CNN. “It’s just sad that our nation has devolved politically to this point.”

Pompeo’s confirmation before the full Senate now hangs in balance, with the votes of just a handful of senators determining whether he becomes the nation’s top diplomat after Trump fired Rex Tillerson last month.

Key Democrats, including some who had voted for Pompeo as CIA director last year, are peeling away, and Republican Sen. Rand Paul of Kentucky remains opposed, despite personal overtures from the president.

Pressure is mounting on senators from both sides. White House allies are unloading ad campaigns against Democrats from Trump-won states, including North Dakota, Indiana and Missouri, to vote for the president’s nominee. But progressive groups are pounding senators’ offices in opposition to Pompeo’s hawkish foreign policy views and negative comments about gay marriage and Muslims. As soon as Sen. Heidi Heitkamp, D-N.D., announced her support last week, one group called on her to switch.

“I don’t agree with every position he’s taken or every word he has spoken,” Sen. Susan Collins, R-Maine, said Sunday on “Meet the Press” on NBC. “But I believe he has an extensive knowledge of world affairs that has been enhanced by his time at the CIA.”

Sen. Maggie Hassan, D-N.H., who met with the nominee last week, “has concerns about Mr. Pompeo’s nomination to serve as secretary of state,” said spokesperson Ricki Eshman. The senator “is reviewing his record before making a final decision.”

In the committee, the opposition has been building ahead of Monday’s session.

Sen. Chris Coons, D-Del., who was among the last Democrats on the panel to announce his no vote, said he’s is concerned that Pompeo “will embolden, rather than moderate or restrain” Trump’s “most belligerent and dangerous instincts.”

“I do not make this decision lightly or without reservations,” Coons said in a statement Friday. “However, I remain concerned that Director Pompeo will not challenge the President in critical moments. On vital decisions facing our country, Director Pompeo seems less concerned with rule of law and partnership with our allies and more inclined to emphasize unilateral action and the use of force.”

Rather than allow an unfavorable vote on the panel, where Republicans have a one-seat majority, senators could choose not to issue a recommendation if Pompeo cannot find enough backing.

The committee action won’t necessarily stall Pompeo’s confirmation before the full Senate, but it would be an unusual setback not seen since the panel took a pass on John Bolton, President George W. Bush’s pick for ambassador to the United Nations.

Sen. Tom Cotton, R-Ark., who has been among Pompeo’s most vocal champions in the Senate, lambasted his colleagues ahead of voting.

“Democrats, especially on the Foreign Relations Committee, are really engaged in shameful political behavior,” Cotton said Sunday on CBS’ “Face the Nation.”

But several Democratic senators who supported Pompeo for CIA director say Pompeo’s views are not reflective of those they want in the top diplomat.

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Follow Mascaro on Twitter at https://twitter.com/LisaMascaro

Travel ban case is justices’ first dive into Trump policy

WASHINGTON (AP) — The Supreme Court has so far had little to say about Donald Trump’s time as president, even as the nation has moved from one Trump controversy to another. That’s about to change.

The justices’ first deep dive into a Trump administration policy comes in a dispute over the third and latest version of the administration’s ban on travel from some countries with majority Muslim populations. Opponents of the policy and some lower courts have labeled it a “Muslim ban,” harking back to Trump’s campaign call to keep Muslims from entering the country.

The high-stakes arguments at the high court on Wednesday could offer some indication about how a court that runs on respect for traditions and precedent will deal with a president who regularly breaks with convention.

Apart from the campaign statements, Trump’s presidential tweets about the travel ban and last fall’s retweets of inflammatory videos that stoked anti-Islam sentiment all could feature in the court’s discussion of the travel ban’s legality.

“The court could get to the right outcome without getting into the question of his tweets. But I think the president set it up so that it’s virtually impossible to ignore him when he’s shouting from the rooftops about what his purpose was in the three versions of the ban,” said Cecillia Wang, the American Civil Liberties Union’s deputy legal director.

Solicitor General Noel Francisco, who will argue the administration’s case, said in a court filing that the ban is well within the president’s authority and is not based on prejudice against Islam.

In a sign of heightened public interest, the court is taking the rare step of making an audio recording of the proceedings available just hours after the arguments end.

One key issue will be how the court evaluates administration actions.

Neil Eggleston, President Barack Obama’s last White House counsel, suggested in an online forum last week that Trump does not merit the same measure of latitude that courts usually give presidents, especially in the areas of national security and immigration.

“The court will have to wrestle with how much to defer to a President who has created this record of chaos and animus,” Eggleston and co-author Amanda Elbogen wrote on justsecurity.org.

Josh Blackman, a professor at the South Texas College of Law in Houston, cautioned that the court would be breaking new ground if it were to treat Trump differently from other presidents.

The policy under review at the court applies to travelers from five countries with overwhelmingly Muslim populations — Iran, Libya, Somalia, Syria and Yemen. It also affects two non-Muslim countries: blocking travelers from North Korea and some Venezuelan government officials and their families. A sixth majority Muslim country, Chad, was removed from the list this month after improving “its identity-management and information sharing practices,” Trump said in a proclamation.

Francisco said the Chad decision shows that the restrictions are premised only on national security concerns. He also said that the State Department has cleared more than 430 visa applicants from the affected countries for waivers that would allow them to enter the U.S.

But the challengers argue that the administration cannot ask the court to ignore all that has happened.

Trump’s first travel ban was issued just a week after he took office in January 2017, and was aimed at seven countries. It triggered chaos and protests across the U.S. as travelers were stopped from boarding international flights and detained at airports for hours. Trump tweaked the order after the 9th U.S. Circuit Court of Appeals in San Francisco refused to reinstate the ban.

The next version, announced in March 2017, dropped Iraq from the list of covered countries and made it clear the 90-day ban covering Iran, Libya, Somalia, Sudan, Syria and Yemen didn’t apply to those travelers who already had visas. It also eliminated language that would give priority to religious minorities. Critics said the changes didn’t erase the ban’s legal problems.

The 9th Circuit and the 4th U.S. Circuit Court of Appeals in Richmond, Virginia, agreed with the ban’s opponents. The 4th Circuit said the ban “drips with religious intolerance, animus and discrimination.” The 9th Circuit ruled that Trump violated immigration law.

The third version is indefinite, unlike the other two, and the administration said it is the product of a thorough review of how other countries screen their own citizens and share information with the U.S.

It fared no better than its predecessors in the lower courts, but the Supreme Court said in an unsigned order in December that it could take full effect while the legal dispute continues. The justices said nothing about the substance of the policy, either in December or in earlier actions involving the ban.

Now, though, they are confronted with the administration’s view that Trump has broad discretion to impose limits on immigration and that the courts don’t even have a role to play. The Justice Department has said throughout the course of the legal fight that the lawsuits challenging the policy should be dismissed without ever reaching the challengers’ claims. The administration says that foreigners have no right to enter the United States and no right to challenge their exclusion in American courts.

Supporting briefs for the ban’s challengers dwarf filings on the administration’s side. Retired high-ranking military officers, former Republican officeholders, Catholic bishops, Amazon, Facebook and 113 other companies, the children of Japanese-Americans who were held in internment camps during World War II and more than a dozen mainly Democratic-led states are among those calling on the court to strike down the Trump policy.

The administration’s supporters include roughly the same number of Republican-led states, as well as conservative groups and Jay Sekulow, one of Trump’s personal lawyers.

A decision in Trump v. Hawaii, 17-965, is expected by late June.

Waffle House suspect still being sought; residents on alert

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NASHVILLE, Tenn. (AP) — As an intensive manhunt continued Monday for a half-naked man suspected in the slayings of four people at a Waffle House restaurant, authorities shared reports of previous efforts to contain the gun-loving man with paranoid delusions.

More than 80 Nashville police officers continued to search for Travis Reinking early Monday, authorities said. Agents with the FBI, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives and troopers with the Tennessee Highway Patrol joined the manhunt.

He was also added to the Tennessee Bureau of Investigation’s Top 10 Most Wanted list.

Reinking was nearly naked, wearing only a green jacket and brandishing an assault-style rifle when he opened fire in the parking lot and then stormed the restaurant, police say. Four people were killed and four others were injured before a quick-thinking customer wrestled the gun away, preventing more bloodshed.

Metropolitan Nashville Police Chief Steve Anderson said at a news conference that Reinking, 29, was last seen Sunday around a wooded area near an apartment complex where he lived, wearing only pants and no shirt or shoes.

Anderson said it’s not clear why Reinking opened fire on restaurant patrons with an assault weapon, though he may have “mental issues.”

James Shaw, Jr. says he didn’t mean to be a hero when he wrestled a gun away from the Nashville Waffle House shooting suspect early Sunday. Police say Shaw, who was wounded, saved lives. (April 23)

He may still be armed, Anderson said, because he was known to have owned a handgun authorities have not recovered.

“He’s on foot,” Anderson said. “Unless he’s been picked up by a car, he would be fairly close. We don’t want to alarm people, but certainly, everybody should take precautions. It could be he’s in an unoccupied house. We want everybody to be concerned. Neighbors should check on each other.”

Nashville public schools will go into “lock-out” mode if Reinking isn’t found in time for class Monday, officials said. That means students will be free to move about the building, but no guests or visitors will be allowed to enter.

As the search continued, authorities in Illinois shared past reports suggesting multiple red flags about a disturbed young man with paranoid delusions who liked firearms.

In May 2016, Reinking told deputies from Tazewell County, Illinois, that music superstar Taylor Swift was stalking him and hacking his phone, and that his family was also involved, according to a report released Sunday.

Another sheriff’s report said Reinking barged into a community pool in Tremont, Illinois, last June, and jumped into the water wearing a pink woman’s coat over his underwear. Investigators believed he had an AR-15 rifle in his car trunk, but it was never displayed. No charges were filed.

Last July, Reinking was arrested by the U.S. Secret Service after he crossed into a restricted area near the White House and refused to leave, saying he wanted to meet President Donald Trump. Reinking was not armed at the time, but at the FBI’s request, state police in Illinois revoked his state firearms card and seized four guns from him, authorities said.

The AR-15 used in the shootings was among the firearms seized.

Then, in August, Reinking told police he wanted to file a report about 20 to 30 people tapping into his computer and phone and people “barking like dogs” outside his residence, according to a report.

Reinking agreed to go to a local hospital for an evaluation after repeatedly resisting the request, the report said.

“There’s certainly evidence that there’s some sort of mental health issues involved,” Tazwell County Sheriff Robert Huston said. But he said deputies returned the guns to Reinking’s father on the promise that he would “keep the weapons secure and out of the possession of Travis.”

Nashville Police spokesman Don Aaron said that Reinking’s father “has now acknowledged giving them back” to his son.

After the shooting, police recovered three of the four guns originally taken from Reinking, officials said. They believe he still has at least one handgun.

Phone calls to a number listed for the father, Jeffrey Reinking, went unanswered.

It is not clear why Reinking moved recently from Morton, Illinois, to Nashville and if it had anything to do with being near Swift. Police say he was employed in construction for a while, and there would have been enough work in the booming city for him.

Police say Reinking drove into the Waffle House parking lot in his gold Chevy Silverado pickup early Sunday and sat there for about four minutes before opening fire outside the restaurant.

The victims fatally shot in the parking have been identified as Taurean Sanderlin, 29, of Goodlettsville, and Joe Perez, 20, of Nashville.

Sanderlin was an employee at the restaurant.

Perez’s mother posted a picture of her son on Facebook and asked for prayers, saying it was the hardest day of her life. “Me, my husband and sons are broken right now with this loss,” Trisha Perez said in the post. “Our lives are shattered.”

Reinking then went inside the restaurant and opened fire, police said.

One of the fatally wounded inside was DeEbony Groves, a 21-year student at Nashville’s Belmont University. She was remembered as an exceptional student who made the Dean’s list, and a tenacious basketball player.

“She was a brilliant young lady, very, very intelligent and a very hard worker,” Gallatin High School basketball coach Kim Kendrick told The Tennessean.

Akilah Dasilva was also killed inside the restaurant. The 23-year-old from Antioch was a rap artist and music video producer who had such skills behind the camera that he was a favorite among many of Music City’s independent musicians and recording labels, The Tennessean reported.

“Music is my life and I will never stop until I achieve my dreams,” Dasilva said on his Twitter account.

Dasilva’s mother told CBS News that her son was a student at Middle Tennessee State University and aspired to be a music engineer.

He was at the restaurant with his girlfriend, 21-year-old Tia Waggoner, the paper reported. Waggoner was wounded and is being treated at Vanderbilt University Medical Center. Dasilva’s family said she underwent surgery and doctors were trying to save her leg.

Police say Sharita Henderson, 24, of Antioch, was wounded and is being treated at VUMC.

Also wounded was James Shaw Jr., a 29-year-old restaurant patron who burned his hand grabbing the hot muzzle of the assault weapon as he wrestled the gun away. A Nashville native who works as a wireless technician for AT&T, Shaw said he was no hero — despite being hailed as one by Nashville Mayor David Briley.

Shaw said he pounced on the suspect out of self-preservation, after making up his mind that “he was going to have to work to kill me.”

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Associated Press writers John Raby in Charleston, West Virginia; Ed White in Detroit; and Justin Pritchard in Los Angeles contributed to this report.

Business: World shares mostly lower, tracking tech sell-off on Wall St

(PhatzNewsRoom / AP)   —   Global shares were mostly lower Monday following Friday’s steep slide in technology shares on Wall Street. Markets had only a muted reaction, if any, to North Korea’s announcement that it would stop nuclear and missile testing.

KEEPING SCORE: Britain’s FTSE 100 was almost unchanged at 7,365.29. Germany’s DAX edged 0.1 percent lower to 12,522.34 and the CAC 40 of France declined 0.2 percent to 5,404.24. The future for the S&P 500 lost 0.1 percent and the future for the Dow lost 0.2 percent.

ASIA’S DAY: Tokyo’s Nikkei 225 fell 0.3 percent to 22,088.04 and South Korea’s Kospi shed 0.1 percent to 2,474.11. Hong Kong’s Hang Seng declined 0.5 percent to 30,254.40 and the Shanghai Composite index dropped 0.1 percent to 3,068.01. Australia’s S&P ASX 200 advanced 0.3 percent to 5,886.00. Shares rose in India but fell in Taiwan and Southeast Asia.

WALL STREET: Losses in technology, retailers, packaged foods and beverage makers weighed on U.S. stocks Friday, pulling the market lower for a second day in a row. The S&P 500 index fell 0.9 percent to 2,670.14. The Dow Jones industrial average slid 0.8 percent to 24,462.94. The Nasdaq composite lost 1.3 percent to 7,146.13 and the Russell 2000 index of smaller-company stocks gave up 0.6 percent, to 1,564.12. For every stock that rose on the New York Stock Exchange, two declined, though the indexes finished the week with gains.

NORTH KOREA: North Korea’s announcement on Saturday to suspend further nuclear and intercontinental ballistic missile tests and close its nuclear test site raised hopes in Washington and Seoul for a breakthrough in the upcoming nuclear negotiations. However, the North’s statement stopped short of suggesting it would give up its nukes or halt production of missiles. That raises the question of what might come of a meeting between North Korean leader Kim Jong Un and South Korean President Moon Jae-in on Friday.

ANALYST VIEWPOINT: “While geopolitical tensions remain bubbling under the surface, rising oil prices and higher U.S. yields suggest investors are likely to deal with increased volatility as a broad range of political, economic and financial events unfolds,” Stephen Innes of OANDA said in a commentary.

ENERGY: Benchmark U.S. crude lost 44 cents to $67.96 per barrel in electronic trading on the New York Mercantile Exchange. On Friday it gained 7 cents to settle at $68.40 per barrel. Brent crude, used to price international oils, sagged 39 cents to $73.67 per barrel.

CURRENCIES: The dollar rose to 108.19 yen from 107.64 yen on Friday. The euro fell to $1.2233 from $1.2290. The pound slipped to $1.3971 from $1.4001.

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– Here are the top five things you need to know in financial markets on Monday, April 23:

1. Treasury Yields Continue Higher; U.S. 10-Year Nears 3%

U.S. Treasury yields continued higher, with the benchmark 10-year note reaching an intraday high of 2.998%, a level not seen since January 2014.

It was last at 2.990%, up 3.9 basis points, or 1.3%, inching closer to the psychologically important 3%-threshold, as strengthening inflation prospects added to expectations of a more hawkish approach from the Federal Reserve.

The 10-year yield has not been above 3% – the point at which strategists and fund managers say equities will really hurt – since early 2014. It started the year at 2.4%.

And it’s not just the 10-year yield which has been shooting higher.

The 2-year note yield hit a high of 2.478%, its strongest level since Sept. 2008, while the 5-year yield touched a peak of 2.828%, a level last seen in June 2009.

If yields continue to breakout, that will certainly start weighing on equities again, like they did earlier this year.

Rising bond yields can crimp demand for assets perceived as riskier, such as stocks, particularly when those yields are higher than those of equities.

2. Dollar Jumps To 1-1/2 Month Highs

The increase in U.S. bond yields helped underpin the dollar, which jumped to a more than seven-week high against a basket of major currencies in early action.

Expectations that the Federal Reserve would raise interest rates three more times in 2018 was also supporting the greenback.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.4% to 90.44, the strongest level since March 1.

The dollar rose to more than two-month highs against the safe haven yen, with USD/JPY up 0.4% to 108.10.

The euro slid to two-week lows, with EUR/USD down almost 0.5% to 1.2230.

Sterling was also lower, with GBP/USD slipping 0.2% to 1.3971.

On the data front, the Chicago Fed national activity index for March is scheduled for release at 8:30AM ET (1230GMT).

Preliminary readings of the manufacturing and services purchasing managers’ indexes for April from Markit are expected at 9:45AM ET (1345GMT), followed by data on existing home sales for March at 10AM ET (1400GMT).

3. U.S. Stock Futures Point To Lower Open

U.S. stock futures pointed to a lower open, as Treasury yields resumed a move higher and investors waited for another big week of earnings to get underway.

The blue-chip Dow futures fell 38 points, or about 0.2%, the S&P 500 futures dipped 3 points, or nearly 0.1%, while the tech-heavy Nasdaq 100 futures fell 7 points, or roughly 0.1%.

U.S. stocks fell on Friday, as a decline in technology stocks and worries about the impact of rising U.S. bond yields weighed, though the major indexes still managed to end the week with a slight gain.

In Europe, the continent’s major bourses edged lower, as results from Switzerland’s biggest bank, UBS (SIX:UBSG), disappointed investors.

Earlier, in Asia, most markets in the region closed mostly lower, tracking a pullback in U.S. equities late last week.

4. Alphabet Kick Off Busy Week Of Earnings

This week will be the busiest week of the first-quarter earnings season, with more than a third of the S&P 500 set to report.

Most of the focus will be on the FAANG group of stocks.

After the bell on Monday, Google parent Alphabet (NASDAQ:GOOGL) is expected by analysts on average to report a 22% increase in revenue to $30.3 billion, with net income rising 21%, equivalent to $9.28 per share on a non-GAAP basis, according to Thomson Reuters data.

Results from Facebook (NASDAQ:FB), Twitter (NYSE:TWTR), Qualcomm (NASDAQ:QCOM), eBay (NASDAQ:EBAY) and PayPal (NASDAQ:PYPL) are due on Wednesday, followed by Amazon (NASDAQ:AMZN), Intel (NASDAQ:INTC), Microsoft (NASDAQ:MSFT) and Baidu (NASDAQ:BIDU) on Thursday.

Among non-tech names, Boeing (NYSE:BA), Caterpillar (NYSE:CAT), 3M (NYSE:MMM), United Technologies (NYSE:UTX), Verizon (NYSE:VZ), AT&T (NYSE:T), Comcast (NASDAQ:CMCSA), Visa (NYSE:V), Ford (NYSE:F), General Motors (NYSE:GM), UPS (NYSE:UPS), Starbucks (NASDAQ:SBUX) and ExxonMobil (NYSE:XOM) are some of the names on the docket for this week.

First-quarter profit at S&P 500 companies are expected to have recorded their strongest gain in seven years. Of the 87 companies that have reported so far, around 80% have topped profit expectations, according to FactSet.

5. Oil Starts The Week In Negative Territory

Oil prices started the week in negative territory, as market players continued to weigh a steady increase in U.S. production levels against ongoing efforts by major global crude producers to reduce a supply glut.

U.S. drillers added five oil rigs in the week to April 20, bringing the total count to 820. That was the highest number since March 2015, underscoring worries about rising U.S. output.

New York-traded WTI crude futures lost 40 cents, or about 0.6%, to $68.00 per barrel, while Brent futures slumped 39 cents, or roughly 0.5%, to $73.68 per barrel.

In Comey memos, Trump talks of jailed journalists, ‘hookers’

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WASHINGTON (AP) — In a series of startlingly candid conversations, President Donald Trump told former FBI Director James Comey that he had serious concerns about the judgment of a top adviser, asked about the possibility of jailing journalists and described a boast from Vladimir Putin about Russian prostitutes, according to Comey’s notes of the talks obtained by The Associated Press on Thursday night.

The 15 pages of documents contain new details about a series of interactions with Trump that Comey found so unnerving that he chose to document them in writing. Those seven encounters in the weeks and months before Comey’s May 2017 firing include a Trump Tower discussion about allegations involving Trump and prostitutes in Moscow; a White House dinner at which Comey says Trump asked him for his loyalty; and a private Oval Office discussion where the ex-FBI head says the president asked him to end an investigation into Michael Flynn, the former White House national security adviser.

The documents had been eagerly anticipated since their existence was first revealed last year, especially since Comey’s interactions with Trump are a critical part of special counsel Robert Mueller’s investigation into whether the president sought to obstruct justice. Late Thursday night, Trump tweeted that the memos “show clearly that there was NO COLLUSION and NO OBSTRUCTION.”

President Donald Trump said Vladimir Putin told him that Russia has ‘some of the most beautiful hookers in the world’, according to memos maintained by former FBI Director James Comey and obtained by The Associated Press. (April 20)

The president also accused Comey of leaking classified information. The memos obtained by the AP were unclassified, though some portions were blacked out as classified. Details from Comey’s memos reported in news stories last year appear to come from the unclassified portions.

In explaining the purpose of creating the memos, which have been provided to Mueller, Comey has said he “knew there might come a day when I would need a record of what had happened” to defend not only himself but the FBI as well.

The memos cover the first three months of the Trump administration, a period of upheaval marked by staff turnover, a cascade of damaging headlines and revelations of an FBI investigation into potential ties between the Trump campaign and Russia. The documents reflect Trump’s uneasiness about that investigation, though not always in ways that Comey seemed to anticipate.

In a February 2017 conversation, for instance, Trump told Comey how Putin told him, “we have some of the most beautiful hookers in the world” even as the president adamantly, and repeatedly, distanced himself from a salacious allegation concerning him and prostitutes in Moscow, according to one memo.

In another memo, Comey recounts how Trump at a private White House dinner pointed his fingers at his head and complained that Flynn, his embattled national security adviser, “has serious judgment issues.” The president blamed Flynn for failing to alert him promptly to a congratulatory call from a world leader, causing a delay for Trump in returning a message to an official whose name is redacted in the documents.

“I did not comment at any point during this topic and there was no mention or acknowledgment of any FBI interest in or contact with General Flynn,” Comey wrote.

By that point, the FBI had already interviewed Flynn about his contacts with the Russian ambassador, Sergey Kislyak, and the Justice Department had already warned White House officials that they were concerned Flynn was vulnerable to blackmail.

Flynn was fired Feb. 13, 2017, after White House officials said he had misled them about his Russian contacts during the transition period by saying that he had not discussed sanctions. The following day, according to a separate memo, Comey says Trump cleared the Oval Office of other officials, encouraged him to let go of the investigation into Flynn and called him a good guy. Flynn pleaded guilty to lying to the FBI and is now cooperating with Mueller’s investigation.

The memos reveal that days before Flynn’s firing, then-White House chief of staff Reince Priebus asked Comey if Flynn’s communications were being monitored under a secret surveillance warrant.

“Do you have a FISA order on Mike Flynn?” Priebus asked Comey, according to the memos, referring to an order under the Foreign Intelligence Surveillance Act.

Comey said he “paused for a few seconds and then said that I would answer here, but that this illustrated the kind of question that had to be asked and answered through established channels.”

Comey’s response is redacted on the unclassified memos.

The memos also show Trump’s continued distress at a dossier of allegations — compiled by an ex-British spy whose work was funded by the Democratic National Committee and the Clinton campaign — examining potential ties between him and his aides and the Kremlin. Comey writes how Trump repeatedly denied to him having been involved in an encounter with Russian prostitutes in a Moscow hotel.

“The President said ‘the hookers thing’ is nonsense,” Comey writes, noting that Trump then related the conversation with Putin about the “most beautiful hookers.” Comey says Trump did not say when Putin had made the comment.

The documents also include the president’s musings about pursuing leakers and imprisoning journalists. They also provide insight into Comey’s personal and professional opinions. He judges the administration’s travel ban to be legally valid, and he takes a swipe at former Attorney General Loretta Lynch, calling her predecessor, Eric Holder, “smarter and more sophisticated and smoother.”

The memos were provided to Congress earlier Thursday as House Republicans escalated criticism of the Justice Department, threatening to subpoena the documents and questioning officials.

In a letter sent to three Republican House committee chairmen Thursday evening, Assistant Attorney General Stephen Boyd wrote that the department was sending a classified version of the memos and an unclassified version. The department released Boyd’s letter publicly but did not release the memos. The chairmen issued a statement late Thursday saying the memos show that Comey clearly never felt threatened, and Trump didn’t obstruct justice.

Justice officials had allowed some lawmakers to view the memos but had never provided copies to Congress. Boyd wrote that the department had also provided the memos to several Senate committees.

Boyd wrote in the letter that the department “consulted the relevant parties” and concluded that releasing the memos would not adversely affect any ongoing investigations. Mueller is investigating potential ties between Russia and Trump’s 2016 campaign as well as possible obstruction of justice by the president.

Comey is on a publicity tour to promote his new book, “A Higher Loyalty.” He revealed last year that he had written the memos after conversations with Trump.

He said in an interview Thursday with CNN that he’s “fine” with the Justice Department turning his memos over to Congress.

“I think what folks will see if they get to see the memos is I’ve been consistent since the very beginning, right after my encounters with President Trump, and I’m consistent in the book and tried to be transparent in the book as well,” he said.

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Associated Press writer Tom LoBianco contributed to this report.

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Link to the memos:

http://apne.ws/dwhMe9R

Moon faces tough challenges ahead of summit with Kim

SEOUL, South Korea (AP) — The meeting next week between the leaders of the rival Koreas will be the ultimate test of South Korean President Moon Jae-in’s belief that his nation should lead international efforts to deal with North Korea.

Previous summits saw beaming grins, strong handshakes and high hopes for lasting peace and flourishing trade between the war-separated rivals after decades of bad blood. There will be significantly less room for sentimentality, and much higher stakes, when the dovish Moon faces off with the decidedly un-dovish North Korean leader Kim Jong Un at the border village of Panmunjom next Friday.

Moon’s job, analysts say, is to keep up positive momentum for more substantial discussions between President Donald Trump and Kim — their separate summit is anticipated in May — over the North’s nuclear disarmament.

A look at the challenges Moon faces ahead of the summit, which will be only the third such meeting between the Koreas since their 1950-53 war:

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SHAKY IN THE MIDDLE?

Seoul can take credit for setting up the talks between Pyongyang and Washington. South Korean officials traveled to Pyongyang in early March and returned with word that Kim had expressed a willingness to talk about giving up his nuclear weapons with Moon and Trump, something that seemed unthinkable just months ago.

But it’s unclear how much more South Korea can control the process. Seoul’s ambitions took a hit when Kim made a surprise visit to Beijing recently for a meeting with Chinese President Xi Jinping. That summit reintroduced China as a major player in the diplomatic push to resolve the nuclear standoff and almost certainly strengthened Kim’s leverage heading into his talks with Moon and Trump.

Analysts say Kim would have asked China, North Korea’s only major ally and economic lifeline, to soften its enforcement of sanctions aimed at the North. Kim also may have sought Chinese commitments to strongly oppose any military measure the United States might take should his talks with Trump fall apart and the North starts testing missiles again.

The Kim-Xi summit exposed South Korea’s delicate role as an intermediary between Washington and Pyongyang and raised further questions over Seoul’s claims that Kim has shown genuine interest in dealing away his nukes.

North Korea has been talking about the denuclearization of the peninsula since the 1980s, but that offer has been linked to a demand that U.S. troops leave South Korea, and that Washington halt its dispatches of nuclear-capable assets to the region during war games and guarantee that it won’t use nukes against the North. Kim has always justified his nuclear weapons development as a defense against the “hostile policies” of the United States and its allies.

Moon said Thursday that Kim isn’t asking for the removal of U.S. troops but still wants security guarantees and for the U.S. to end its “hostile” policy.

It won’t be clear until the summits occur what North Korea intends, but its closeness to China strongly indicates its traditional stance remains. Beijing has called for a “dual suspension” — of the North’s nuclear and missile activities and of the large-scale military exercises between the U.S. and South Korea.

For Washington and Seoul, denuclearization means ridding the North of its nuclear weapons.

Any ambiguity short of that meaning could pose credibility problems for Seoul, which also could be pushed aside if Washington chooses to deal more directly with China.

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WHO’S IN THE DRIVER’S SEAT

At the meeting in Panmunjom, the Koreas may agree on measures to reduce tension across their heavily-armed border and regular communication on a new hotline between their leaders. They may also agree on cultural and sports exchanges.

But for South Korea, the meeting is mostly about keeping alive a positive atmosphere for the Kim-Trump talks. This means Moon must persuade Kim to OK a vision of denuclearization that’s closer to what Seoul and Washington have in mind.

Moon has been calling for a process where North Korea first declares its commitment to denuclearization and a permanent peace regime on the peninsula in exchange for the allies promising a security guarantee. The North would then enter a phased process that begins with a freeze of its nuclear weapons and missiles and ends with their complete removal. Washington and Seoul would then set up a robust verification mechanism and gradually lift sanctions and carry out the promised security measures based on Pyongyang’s fulfillment of its obligations.

Things could break down if Kim demands bigger concessions up front or asks for separate negotiations and rewards for completing each step. North Korea has always balked at allowing outside inspectors into its facilities.

Some South Korean and U.S. officials have said Kim may be looking to save an economy battered by tightening sanctions. But Patrick McEachern, a former State Department analyst currently with the Washington-based Wilson Center, said there’s no economic panic in North Korea and the country’s food prices and exchange rate remain unaffected.

“(Kim) seems to see himself as being in the driver’s seat and entering negotiations from a position of strength,” said McEachern. “Kim offered summits after declaring victory in completing his nuclear program, not any observable economic realization.”

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SUNRISE OR SUNSET

Moon has vowed to build on the legacies of late liberal Presidents Kim Dae-jung and Roh Moo-hyun and their so-called “Sunshine Policy,” which Moon had a hand in building. Seoul’s economic inducements resulted in two summits with the North and a temporary rapprochement in the 2000s.

Moon says the decade of hard-line conservative policies he ended when elected last year did nothing to stop Pyongyang’s weapons advancements. He has balanced his criticism of the North’s nuclear program with hints of ambitious economic promises in exchange for denuclearization. Moon’s proposals have included reconnecting an inter-Korean railway and building a gas pipeline connecting the Koreas with Russia.

But Moon is in a significantly tougher spot than his liberal predecessors, who governed when the North’s nuclear threat was nascent. It’s becoming harder to get South Koreans excited about engaging a nuclear North Korea when there’s no longer strong public interest in reunification. This means that Moon can’t reward North Korea with big economic projects without also seeing the results of a verified denuclearization.

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Follow Kim Tong-hyung on Twitter at @KimTongHyung

Israeli leaflets tell Gaza residents to shun border protest

GAZA CITY, Gaza Strip (AP) — Israeli military aircraft on Friday dropped leaflets urging Palestinians to stay away from the Gaza-Israel border fence and warning that they endanger their lives if they follow directives of Hamas organizers of the weekly protests there.

The leaflets were dropped ahead of what is to be the fourth large-scale border march since March 30. In the past three weeks, 28 Palestinians have been killed and hundreds wounded by Israeli troops firing from across the border fence.

The military has said it is defending Israel’s border and that its troops, including snipers, only target “instigators.” It has also accused Hamas of using mass protests as a cover for attacks.

Israel has faced international criticism for its response to the mass marches. Rights groups have branded open-fire orders as unlawful, saying they effectively permit soldiers to use potentially lethal force against unarmed protesters.

White House envoy Jason Greenblatt, a member of President Donald Trump’s Mideast team, said on social media that Palestinians in Gaza have a “right to protest their dire humanitarian circumstances.”

Organizers “should focus on that message, not stoke the potential for more violence with firebombs and flaming kites, and must keep a safe distance from the border,” said Greenblatt, adding that “the cost of these demonstrations is too high in loss of life and injuries.”

The protests are to continue at least until May 15, the anniversary of Israel’s 1948 creation. Palestinians mark the day as their “nakba,” or catastrophe, when hundreds of thousands fled or were driven from their homes in the Mideast war over Israel’s founding.

On Thursday, organizers moved sit-in protest tents, each set up several hundred meters from the border, closer to the fence. Organizers said they will gradually move the camps toward the fence until May 15, but have made conflicting comments about a possible mass border breach.

Hamas says the protests are aimed at breaking a crippling border blockade that was imposed by Israel and Egypt after the Islamic militant group overran the territory in 2007, a year after winning Palestinian parliament elections.

The marches also press for the return of Palestinian refugees and their descendants to what is now Israel.

In Friday’s leaflets, the Israeli military said that it is “prepared for all scenarios,” urging Gaza residents to stay away from the fence and not attempt to harm it.

“Don’t obey the Hamas terror organization’s directions – they endanger your lives,” the leaflet said.

While Hamas and smaller Palestinian factions have taken a lead as organizers, the mass marches are also fueled by growing desperation among Gaza’s 2 million residents.

The border blockade has trapped nearly all of them in the tiny coastal territory, gutted the economy and deepened poverty. Gaza residents typically get fewer than five hours of electricity per day, while unemployment has soared above 40 percent.

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Associated Press writers Ian Deitch in Jerusalem and Karin Laub in Jericho, West Bank, contributed to this report.

Judge to hear arguments about delaying Stormy Daniels case

LOS ANGELES (AP) — President Donald Trump’s lawyer is asking a federal judge in Los Angeles to delay a court case brought by a porn actress who claims she had an affair with the president.

U.S. District Judge James Otero is set to hear arguments Friday morning about whether to delay Stormy Daniels’ case after FBI agents raided the office and residence of Trump’s lawyer, Michael Cohen, seeking records about a nondisclosure agreement Daniels signed days before the 2016 presidential election.

Daniels, whose real name is Stephanie Clifford, has been seeking to invalidate the agreement and has offered to return the $130,000 she was paid in order to publicly discuss the relationship and “set the record straight.” She argues the agreement is legally invalid because it was only signed by Daniels and Cohen, but was not signed by Trump.

Cohen, who has denied there was ever an affair, said he paid the $130,000 out of his pocket using a home equity loan. He has said neither the Trump Organization nor the Trump campaign was a party to the transaction with Daniels and he was not reimbursed for the payment.

Trump answered questions about Daniels for the first time earlier this month and said he had no knowledge of the payment made by Cohen and didn’t know where Cohen had gotten the money. The White House has repeatedly said Trump denies the affair.

Cohen’s attorneys have accused Daniels of violating the agreement’s confidentiality clauses more than 20 times and said she could be liable for $1 million in damages for each violation.

The case took on new significance last week when FBI agents raided Cohen’s office, hotel and residence.

The agents were seeking any information on payments made to Daniels and a former Playboy model, Karen McDougal, according to people familiar with the investigation but not authorized to discuss it publicly. The search warrants also sought bank records, records on Cohen’s dealings in the taxi industry and his communications with the Trump campaign, the people said.

After the raids, Cohen asked a judge in Los Angeles to grant a stay for at least 90 days and argued that because the allegations in the lawsuit overlap with the criminal investigation, Cohen’s civil rights “may be adversely affected if this case proceeds.”

Daniels’ attorney, Michael Avenatti, has objected to the delay and pressed for the case to continue immediately.

In a tweet on Thursday, Avenatti said he would “vehemently argue against the attempt by Mr. Cohen and Mr. Trump to delay this case.”

“The American people deserve the truth as quickly as possible,” he said.

First clues emerge about Cuba’s future under new president

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HAVANA (AP) — Miguel Diaz-Canel has been the presumptive next president of Cuba since 2013, when Raul Castro named the laconic former provincial official to the important post of first vice president and lauded him as “neither a novice nor an improviser,” high praise in a system dedicated to continuity over all.

Castro said nothing about how a young civilian from outside his family could lead the socialist nation that he and his older brother Fidel created from scratch and ruled with total control for nearly 60 years.

Exiles in Miami said Diaz-Canel would be a figurehead for continued Castro dominance. Cubans on the island speculated about a weak president sharing power with the head of the communist party, or maybe a newly created post of prime minister. No one who knew was talking. And no one who was talking knew.

The first clues to the mystery of Cuba’s future power structure were revealed early Thursday when Raul Castro handed the presidency to Diaz-Canel, who took office when the 604-member National Assembly said 603 of its members had approved the 57-year-old as the sole official candidate for the top government position.

Raul Castro has passed Cuba’s presidency to Miguel Diaz-Canel, putting the island’s government in the hands of someone outside the Castro family for the first time in nearly six decades. (April 19)

With Castro watching from the audience, Diaz-Canel made clear that for the moment he would defer to the man who founded Cuba’s communist system along with his brother. Diaz-Canel said he would retain Castro’s Cabinet through at least July, when the National Assembly meets again.

“I confirm to this assembly that Raul Castro, as first secretary of the Communist Party, will lead the decisions about the future of the country,” Diaz-Canel said. “Cuba needs him, providing ideas and proposals for the revolutionary cause, orienting and alerting us about any error or deficiency, teaching us, and always ready to confront imperialism.”

Perhaps more importantly, Castro’s 90-minute valedictory speech offered his first clear plan for a president whom Castro seemed to envision as the heir to near-total control of the country’s political system, which in turn dominates virtually every aspect of life in Cuba. Castro said he foresees the white-haired electronics engineer serving two five-year terms as leader of the Cuban government, and taking the helm of the Communist Party, the country’s ultimate authority, also for two five-year terms, when Castro leaves the powerful position in 2021.

“From that point on, I will be just another soldier defending this revolution,” Castro said. The 86-year-old general broke frequently from his prepared remarks to joke and banter with officials on the dais in the National Assembly, saying he looked forward to having more time to travel the country.

State media struck a similar valedictory tone. The evening newscast played black-and-white footage of Castro as a young revolutionary, with the soundtrack of “The Last Mambi” a song that bids farewell to Castro as a public figure and was written by Raul Torres, a singer who composed a similar homage to Fidel Castro after the revolutionary leader’s death in 2016.

The plan laid out by Raul Castro on Thursday would leave Diaz-Canel as the dominant figure in Cuban politics until 2031.

“The same thing we’re doing with him, he’ll have to do with his successor,” Castro said. “When his 10 years of service as president of the Council of State and Council of Ministers are over, he’ll have three years as first secretary in order to facilitate the transition. This will help us avoid mistakes by his successor, until (Diaz-Canel) retires to take care of the grandchildren he will have then, if he doesn’t have them already, or his great-grandchildren.”

Diaz-Canel pledged that his priority would be preserving Cuba’s communist system while gradually reforming the economy and making the government more responsive to the people.

“There’s no space here for a transition that ignores or destroys the legacy of so many years of struggle,” Diaz-Canel said.

Diaz-Canel said he would work to implement a long-term plan laid out by the National Assembly and Communist Party that would continue allowing the limited growth of private enterprises like restaurants and taxis, while leaving the economy’s most important sectors such as energy, mining, telecommunications, medical services and rum- and cigar-production in the hands of the state.

“The people have given this assembly the mandate to provide continuity to the Cuban Revolution during a crucial, historic moment that will be defined by all that we achieve in the advance of the modernization of our social and economic model,” Diaz-Canel said.

Cubans said they expected their new president to deliver improvements to the island’s economy, which remains stagnant and dominated by inefficient, unproductive state-run enterprises that are unable to provide salaries high enough to cover basic needs. The average monthly pay for state workers is roughly $30 a month.

“I hope that Diaz-Canel brings prosperity,” said Richard Perez, a souvenir salesman in Old Havana. “I want to see changes, above all economic changes allowing people to have their own businesses, without the state in charge of so many things.”

But in Miami, Cuban-Americans said they didn’t expect much from Diaz-Canel.

“It’s a cosmetic change,” said Wilfredo Allen, a 66-year-old lawyer who left Cuba two years after the Castros’ 1959 revolution. “The reality is that Raul Castro is still controlling the Communist Party. We are very far from having a democratic Cuba.”

After formally taking over from his older brother Fidel in 2008, Raul Castro launched a series of reforms that led to a rapid expansion of Cuba’s private sector and burgeoning use of cellphones and the internet. Cuba today has a vibrant real estate market and one of the world’s fastest-growing airports. Tourism numbers have more than doubled since Castro and President Barack Obama re-established diplomatic relations in 2015, making Cuba a destination for nearly 5 million visitors a year, despite a plunge in relations under the Trump administration.

Castro’s moves to open the economy even further have largely been frozen or reversed as soon as they began to generate conspicuous displays of wealth by the new entrepreneurial class in a country officially dedicated to equality among its citizens. Foreign investment remains anemic and the island’s infrastructure is falling deeper into disrepair. The election of President Donald Trump dashed dreams of detente with the U.S., and after two decades of getting Venezuelan subsidies totaling more than $6 billion a year, Cuba’s patron has collapsed economically, with no replacement in the wings.

Castro’s inability or unwillingness to fix Cuba’s structural problems with deep and wide-ranging reforms has many wondering how a successor without Castro’s founding-father credentials will manage the country over the next five or 10 years.

“I want the country to advance,” said Susel Calzado, a 61-year-old economics professor. “We already have a plan laid out.”

At the U.S. State Department, spokeswoman Heather Nauert expressed disappointment at the handover, saying Cuban citizens “had no real power to affect the outcome” of what she called the “undemocratic transition.”

Vice President Mike Pence tweeted at Castro that the U.S. won’t rest until Cuba “has free & fair elections, political prisoners are released & the people of Cuba are finally free!”

Diaz-Canel first gained prominence in Villa Clara province as the top Communist Party official, a post equivalent to governor. People there describe him as a hard-working, modest-living technocrat dedicated to improving public services. He became higher education minister in 2009 before moving into the vice presidency.

In a video of a Communist Party meeting that inexplicably leaked to the public last year, Diaz-Canel expressed a series of orthodox positions that included somberly pledging to shutter some independent media and labeling some European embassies as outposts of foreign subversion.

But he has also defended academics and bloggers who became targets of hard-liners, leading some to describe him a potential advocate for greater openness in a system intolerant of virtually any criticism or dissent.

International observers and Cubans alike will be scrutinizing every move he makes in coming days and weeks.

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Associated Press writer Ben Fox contributed to this report.

2 black men arrested at Starbucks get an apology from police

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PHILADELPHIA (AP) — Rashon Nelson initially brushed it off when the Starbucks manager told him he couldn’t use the restroom because he wasn’t a paying customer.

He thought nothing of it when he and his childhood friend and business partner, Donte Robinson, were approached at their table and were asked if they needed help. The 23-year-old entrepreneurs declined, explaining they were just waiting for a business meeting.

A few minutes later, they hardly noticed when the police came into the coffee shop — until officers started walking in their direction.

“That’s when we knew she called the police on us,” Nelson told The Associated Press in the first interview by the two black men since video of their April 12 trespassing arrests touched off a furor around the U.S. over racial profiling or what has been dubbed “retail racism” or “shopping while black.”

Nelson and Robinson were led away in handcuffs from the shop in the city’s well-to-do Rittenhouse Square neighborhood in an incident recorded on a white customer’s cellphone.

In the week since, the men have met with Starbucks’ apologetic CEO and have started pushing for lasting change at the coffee shop chain, including new policies on discrimination and ejecting customers.

Rashon Nelson and Donte Robinson spoke to the Assoiciated Press, giving a timeline of events of the day they walked into the Philadelphia Starbucks and got arrested, to the days of protests after. (April 19)

“We do want to make sure it doesn’t happen to anybody again,” Robinson said. “What if it wasn’t us sitting there? What if it was the kid that didn’t know somebody that knew somebody? Do they make it to jail? Do they die? What happens?”

On Thursday, they also got an apology from Philadelphia police Commissioner Richard Ross, a black man who at first staunchly defended his officers’ handling of the encounter.

“I should have said the officers acted within the scope of the law, and not that they didn’t do anything wrong,” Ross said. “Words are very important.”

At a news conference, a somber Ross said he “failed miserably” in addressing the arrests. He said that the issue of race is not lost on him and that he shouldn’t be the person making things worse.

“Shame on me if, in any way, I’ve done that,” he said.

He also said the police department did not have a policy for dealing for such situations but does now and it will be released soon.

Nelson and Robinson said they went to the Starbucks to meet Andrew Yaffe, a white local businessman, over a potential real estate opportunity. Three officers showed up not long after. Nelson said they weren’t questioned but were told to leave immediately.

Yaffe showed up as the men were being handcuffed and could be seen in the video demanding an explanation for the officers’ actions. Nelson and Robinson did not resist arrest.

“When you know that you did nothing wrong, how do you really react to it?” Nelson said. “You can either be ignorant or you can show some type of sophistication and act like you have class. That was the choice we had.”

It was not their first encounter with police. But neither had been arrested before, setting them apart from many of those they grew up with in their gritty southwest Philadelphia neighborhood.

Nelson and Robinson spent hours in a jail cell and were released after midnight, when the district attorney declined to prosecute them.

Nelson said he wondered if he’d make it home alive.

“Any time I’m encountered by cops, I can honestly say it’s a thought that runs through my mind,” Nelson said. “You never know what’s going to happen.”

Starbucks has said the coffee shop where the arrests occurred has a policy that restrooms are for paying customers only, but the company has no overall policy. The men’s attorney, Stewart Cohen, said they were illegally profiled.

The arrests prompted protests at the Starbucks and a national boycott. Kevin Johnson, CEO of the Seattle-based company, came to Philadelphia to meet with the men, called the arrests “reprehensible” and ordered more than 8,000 Starbucks stores closed on the afternoon of May 29 so that nearly 175,000 employees can receive training on unconscious bias. Starbucks has not identified the employee who called police.

Robinson said that he appreciates the public support but that anger and boycotting Starbucks are not the solution.

The men said they are looking for more lasting results and are in mediation with Starbucks to make changes, including the posting in stores of a customer bill of rights; the adoption of new policies on customer ejections and racial discrimination; and independent investigations of complaints.

“You go from being someone who’s just trying to be an entrepreneur, having your own dreams and aspirations, and then this happens,” Nelson said. “How do you handle it? Do you stand up? Do you fight? Do you sit down and just watch everyone else fight for you? Do you let it slide, like we let everything else slide with injustice?”

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Whack is The Associated Press’ national writer for race and ethnicity. Follow her work on Twitter at http://www.twitter.com/emarvelous

Business: Asian shares fall back on trade worries, tech outlook

SEOUL, South Korea (AP) — Asian shares fell back Friday after a major supplier to Apple forecast continued weak demand for mobile devices. A warning by the head of the IMF over the potential for trade tensions to harm global growth also weighed on sentiment.

KEEPING SCORE: Japan’s Nikkei 225 edged 0.1 percent lower to 22,181.06, shedding early gains. South Korea’s Kospi lost 0.4 percent to 2,475.72 while Hong Kong’s Hang Seng index fell 0.6 percent to 30,531.52. The Shanghai Composite Index slumped 1.5 percent to 3,072.24. Australia’s S&P/ASX 200 retreated 0.3 percent to 5,865.00. Stocks in Taiwan, Singapore and Indonesia also declined.

APPLE SUPPLIERS: Taiwan Semiconductor Manufacturing Co. plunged nearly 6 percent in Taiwan after the key Asian Apple supplier gave a lower-than-expected revenue forecast for the second quarter of $7.8 billion-$7.9 billion. The company predicted demand in the mobile sector would remain weak. Other Apple suppliers also traded lower. South Korea’s LG Display Co. lost 0.8 percent and Samsung Electronics Co., tumbled 1.9 percent.

ANALYST’S TAKE: Weak guidance from Taiwan Semiconductor Manufacturing Co., a major supplier to Apple, brewed concerns of weak iPhone demand, dragging technology shares lower, Jingyi Pan, a market strategist at IG in Singapore, said in a commentary. “The corresponding impact would certainly be watched into the Asian session today with the supply chain sprawled across the region.”

TRADE: The head of the International Monetary Fund, Christine Lagarde, is urging countries to work out their differences over trade and take advantage of the healthy world economy to reduce debt before the next downturn comes. Speaking as the IMF and World Bank began their spring meeting, Lagarde warned against complacency: “More needs to be done to sustain this upswing and foster long-term growth,” she said.

WALL STREET: U.S. stock markets finished lower on Thursday, ending a three-day winning streak for the market as technology and consumer products companies went sour. The S&P 500 index fell 0.6 percent to 2,693.13. The Dow Jones industrial average slid 0.3 percent to 24,664.89. The Nasdaq composite lost 0.8 percent to 7,238.06. The Russell 2000 index of smaller-company stocks gave up 0.6 percent to 1,573.82.

OIL: Benchmark U.S. crude lost 24 cents to $68.09 per barrel on the New York Mercantile Exchange. The contract lost 14 cents to finish at $68.33 per barrel on Thursday. Brent crude, used to price international oils, fell 18 cents to $73.60 per barrel in London. On Thursday, it rose 30 cents to close at $73.78 per barrel in London.

CURRENCIES: The dollar rose to 107.65 yen from 107.38 yen. The euro fell to $1.2342 from $1.2345.

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– Here are the top five things you need to know in financial markets on Friday, April 20:

1. Oil flat as Russia contemplates easing quota levels in H2

Oil prices were mostly flat on Friday but still remained near their highest level in over three and a half years as officials from the Organization of the Petroleum Exporting Countries and Russia met in Saudi Arabia.

According to reports, the joint OPEC and non-OPEC panel found that compliance with the agreement to curb production hit another “record high” while the global supply glut has been “virtually eliminated”.

Oil inventories in developed nations in March stood at 12 million barrels above the five-year average, a source told Reuters. That’s down from 340 million barrels above the average in January 2017.

Russian Energy Minister Alexander Novak commented that a discussion of easing the quota levels could begin in the second half of this year or 2019, although he insisted that it remained to be seen if the market rebalancing was sustainable.

Still ahead, the weekly installment of drilling activity from Baker Hughes will provide investors with fresh insight into U.S. oil production and demand after data last week showed the number of U.S. oil rigs rose for the second straight week.

2. Earnings: All Eyes on General Electric

Focus on earnings will continue to drive sentiment in stock markets as a slew of names report corporate earnings Friday.

Of the 74 S&P firms that have reported earnings through Thursday, 80% have beat on both the top and bottom line.

Some of the more notable names due to report earnings before U.S. markets open on Friday include General Electric (NYSE:GE), Honeywell (NYSE:HON) and Schlumberger (NYSE:SLB).

GE’s earnings report is expected to be the pick of the bunch on Friday. The firm’s guidance will be closely watched after Goldman analyst Joe Ritchie said in a note to clients that a cut to the outlook is “almost a certainty”.

3. Markets wait for Fed speakers with eyes on Treasuries

With no major economic data on Friday’s agenda, market participants will continue to look for clues on monetary policy from Federal Reserve members.

Cleveland Fed president Loretta Mester reiterated her view that the central bank should forge ahead with plans to gradually reduce policy accommodation.

“If the economy evolves as I anticipate, I believe further gradual increases in interest rates will be appropriate this year and next year,” she remarked on Thursday evening.

Markets have largely priced in that the Fed will hike rates twice more this year. Fed fund futures put the odds of the next rate hike coming in June at around 97%, according to Investing.com’s Fed Rate Monitor Tool. The probability of another increase in December was seen at about 88%.

Chicago Fed president Charles Evans was scheduled to speak on the economic outlook and monetary policy at 9:40AM ET (13:40GMT) Friday, while San Francisco Fed chief John Williams will make an appearance at 11:15AM ET (15:15GMT).

While waiting for the remarks, bond yields saw some volatile trade on Friday. After passing 2.9% a day earlier, the yield on the 10-Year Treasury note continued to tick higher on Friday. The yield on the 2-Year note turned lower after hitting 2.441% overnight, its highest level since September 2018.

4. Cable drops as BoE governor dampens rate hike expectations

The pound moved lower against the dollar on Friday after Bank of England governor Mark Carney hinted that market expectations for a rate hike in May could be overblown.

Late Thursday, Carney told BBC that while markets could expect gradual rate hikes in the coming years, he didn’t want “to get too focused on the precise timing”.

The BoE chief pointed to weak business surveys and retail sales as some of the softer data.

“I am sure there will be some differences of view but it is a view we will take in early May, conscious that there are other meetings over the course of this year,” he said in the interview.

5. Japanese inflation holds steady, reinforcing forecast for BoJ to stand pat

Japan’s core price index held steady at an annualized gain of 1.1% in March, while underlying inflation stuck at 0.9%. Both readings were in line with consensus.

The data reinforced a Reuters’ poll released Friday that showed the Bank of Japan is expected to keep monetary policy unchanged at its meeting next week, with inflation still far from the bank’s 2% target.

Analysis: The Fight With the West Is Isolating Russia. But That Isn’t Stopping Putin.

“The party of war has won within the Russian elite,” said Yuliy A. Nisnevich, a political-science professor. “There are people in the elites who would like the confrontation to stop — these are the people who would like to spend or earn money abroad. But the party of war, the people who get their money inside the country and live here, is prevalent now.”

Russia, of course, professes its innocence on all fronts. It accuses the West of suffering from an advanced case of Russophobia, a longstanding disease that emerges from hibernation whenever Russia begins to “get up off its knees.”

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Mr. Putin visiting an exhibition hall in Moscow last week. Russia accuses the West of an advanced case of Russophobia. Credit Pool photo by Maxim Shipenkov

Sergei V. Lavrov, Russia’s foreign minister, said in a television interview broadcast Tuesday that the last vestiges of trust with the West were evaporating, sinking below even Cold War levels. “There were communication channels during the Cold War, and there was no obsession with Russophobia, which looks like genocide through sanctions,” Mr. Lavrov told the BBC.

From the Western countries’ perspective, however, the mood is one of enough is enough, and they are gradually acting in concert in delivering that message to the Kremlin. Economic sanctions imposed after the 2014 annexation of Crimea, which represented the start of deteriorating relations, have remained intact despite repeated predictions from the Kremlin that one European Union member or another would eventually veto them.

More recently, there was the mass expulsion of some 150 Russian diplomats from Western nations after the chemical poisoning of a former Russian spy in Britain in March; harsh United States sanctions against several Russian oligarchs, political figures and companies; and the bombing of Syria by the United States, France and Britain over the weekend.

“There is an upsurge in momentum of the kind we have not seen before,” said James Nixey, the head of the Russian program at the London-based think tank Chatham House. He is not sure it will last, however, with nations like Hungary following the Putin model, while the Baltics and the Scandinavian countries remain far more wary.

In Russia, the population can basically be broken down into three groups, said Vladislav L. Inozemtsev, a Russian scholar currently at the Polish Institute of Advanced Studies in Warsaw.

The circle around Putin and the bulk of the population are sure that Russia is doing everything right, while the urban elite, including a majority of the business community, thinks it has gone too far and needs to find a way to reset relations with the West, he said.

The latter group views growing Western consolidation with trepidation, he said, while the Putin court and the majority “believe that quite soon the Western unity will vanish.”

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Rusal, which operates this aluminum smelter in Krasnoyarsk, is among the companies hit by U.S. sanctions. Credit Andrey Rudakov/Bloomberg

They have a wild card in President Trump. He has long been reluctant to criticize Russia, but his attitude has proved more volatile of late. On Sunday, Nikki R. Haley, the American ambassador to the United Nations, said that Washington was about to impose yet more sanctions on Russia, but Mr. Trump rejected the idea on Monday.

There are those who believe that the Russians have some hold over Mr. Trump. That explanation does not have much public currency in Russia, where the attitude swings between humor and exasperation.

If the value of the ruble in relation to the dollar used to fluctuate according to the price of oil, it is now Trump tweets about Russia that send it swinging, goes one joke.

But economists are not laughing about the sanctions imposed by the United States last week. The hardest hit was Rusal, one of the world’s largest manufacturers of aluminum, which appeared on the sanctions list and saw its value plummet. Japan just became the latest country to announce that it would halt purchases from the company.

The Russian Parliament expedited a draft of proposed countersanctions last week that ranged from halting the import of medicine from the United States, to cutting off titanium and uranium sales, to allowing the open theft of American intellectual property. A statement by one legislator, Pyotr O. Tolstoy — a descendant of the writer — that Russians would happily drink brewed tree bark instead of using American medicine provoked widespread derision.

On social media, the idea of imposing countersanctions has become known as “bombing Voronezh,” a provincial Russian city, the idea being that such measures invariably hurt Russians.

“We all see that the sanctions standoff is strengthening,” said Mr. Nikolaev, the economist, and the Russian response “might in fact harm us.”

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President Trump rejected the idea of imposing more sanctions on Russia on Monday, although the administration said they were still under consideration. Credit Doug Mills/The New York Times

Boeing, for example, buys about 35 percent of its titanium, which is used extensively in the 787 Dreamliner, from VSMPO-Avisma, the state monopoly that controls titanium production. The company warned in a statement that such a measure could adversely affect 20,000 employees and the economy as a whole.

The outcry from businesses over the potential countersanctions was such that Russian Parliament postponed discussion of the measures until May 15 to allow for consultations.

Ultimately, the path is clear, with the upshot of actions from both the West and Russia driving the “deglobalization” of Russia, said Evsey Gurvich, the head of the Expert Economic Group, an independent analytic center. As the West shuns Russia, the country will withdraw more and more to try to protect itself from further sanctions, he said.

This year economic growth will be lower than the 2 percent anticipated, with expert predictions ranging from 1.7 percent to none.

The result, some experts noted, is the state’s taking control over more of the economy as it tries to protect jobs and industries from the fallout from sanctions, driving Russia back toward the Soviet model. In addition, when a big company like Rusal gets hit with sanctions and its revenues plunge, there is less tax revenue for the budget so social services like medicine and education suffer cuts.

It is unclear that there will be domestic political problems for Mr. Putin, however. Real incomes have been falling over the last few years, but he still received overwhelming support in the March presidential election.

No one expects economic issues to change Mr. Putin’s mind about confronting the West either. The upshot is that the Kremlin elite who are winning the internal struggle value geopolitical goals far more than the country’s economic development, experts said.

“When we say that we are not successful and quote economic numbers, they say that they do not care about this,” said Leonid Gozman, a political commentator and former politician.

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Correction: April 18, 2018
An earlier version of this article misstated the date of a BBC interview with Sergei V. Lavrov, Russia’s foreign minister. It was broadcast Tuesday, not Thursday.

Trump says unless NKorea summit ‘fruitful’ he’ll pull out

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WASHINGTON (AP) — President Donald Trump said Wednesday that although he’s looking ahead optimistically to a historic summit meeting with North Korean leader Kim Jong Un he could still pull out if he feels it’s “not going to be fruitful.”

Trump said that CIA Director Mike Pompeo and Kim “got along really well” in their recent secret meeting, and he declared, “We’ve never been in a position like this” to address worldwide concerns over North Korea’s nuclear weapons.

But speaking alongside Japanese Prime Minister Shinzo Abe, after the allies met at Trump’s Florida resort, he made clear that he’d still be ready to pull the plug on what is being billed as an extraordinary meeting between the leaders of longtime adversaries.

“If I think that if it’s a meeting that is not going to be fruitful we’re not going to go. If the meeting when I’m there is not fruitful I will respectfully leave the meeting,” Trump told a news conference. He also said that a U.S.-led “maximum pressure” campaign of tough economic sanctions on North Korea would continue until the isolated nation “denuclearizes.”

Abe echoed the sentiment.

“Just because North Korea is responding to dialogue, there should be no reward. Maximum pressure should be maintained,” he said.

President Donald Trump says the United States will be doing “everything possible” to make an upcoming meeting with North Korean leader Kim Jong Un a “worldwide success.” (April 18)

Trump has said his summit with Kim, with whom he traded bitter insults and threats last year as North Korea conducted nuclear and missile tests, could take place by early June, although the venue has yet to be decided. It would be the first such leadership summit between the two nations after six decades of hostility following the Korean War.

Other than the threat posed to by North Korea’s weapons of mass destruction, another issue overhanging the summit plans is the fate of three Americans detained there. Trump said that was under negotiation and there was a “good chance” of winning their release, but he wouldn’t say whether that was a precondition for sitting down with Kim.

Pompeo raised the question of the three Americans in his meeting with Kim, a U.S. official said.

Trump also said he had promised Abe he would work hard for the return of Japanese nationals abducted by North Korea. Tokyo says at least a dozen Japanese said to have been taken in the 1970s and 1980s remain unaccounted for.

News of Pompeo’s trip to North Korea, which took place more than two weeks ago, emerged on Tuesday, as lawmakers weighed whether he should be confirmed to become secretary of state. Trump and Republican senators held up his highly unusual, secret mission as sign of Pompeo’s diplomatic ability. But the prospect of his confirmation hung in the balance as Democrats lined up against him.

Sen. Robert Menendez, top-ranking Democrat on the Senate Foreign Relations Committee that will have the first vote on confirmation, expressed frustration that the CIA chief had not briefed him on the visit that took place more than a week before Pompeo’s public hearing last Thursday.

He is the most senior U.S. official to meet with a North Korean leader since Secretary of State Madeleine Albright met with Kim’s father in Pyongyang in 2000.

“Now I don’t expect diplomacy to be negotiated out in the open, but I do expect for someone who is the nominee to be secretary of state, when he speaks with committee leadership and is asked specific questions about North Korea, to share some insights about such a visit,” Menendez said at the Center for Strategic and International Studies.

The committee is expected to vote on the nomination next week. Pompeo, whose hawkish foreign policy views and comments about minorities have raised Democratic hackles, would replace Rex Tillerson who was pushed out by Trump last month.

In the U.S. Senate, Republicans have a single-vote advantage on the 21-member panel that will have the first say on Pompeo’s nomination. With nine of the 10 Democrats already declaring they will oppose Pompeo, and at least one Republican, Rand Paul of Kentucky, also opposed, the panel could be forced to take the unusual step of sending the nomination to the full Senate without a favorable recommendation.

Trump said Wednesday he expects Paul to come through on Pompeo. The president called Paul and the senator agreed to meet with Pompeo, but Paul’s spokesman said, “Nothing else has changed.”

As for opposition by Democrats, Republican Cory Gardner, who chairs an Asia subcommittee, said in an interview that they “want to play partisan politics.”

Despite meeting Pompeo Tuesday, Gardner said he hadn’t been briefed on the trip and was awaiting more information about it. Still, he said the fact that the meeting happened gave weight to Pompeo’s testimony last week that the administration was committed to the “complete and verifiable denuclearization” of North Korea and sustaining sanctions pressure.

It is not unprecedented for U.S. intelligence officials to serve as conduits for communication with Pyongyang. In 2014, the then-director of U.S. national intelligence, James Clapper, secretly visited North Korea to bring back two American detainees. Clapper did not, however, meet with Kim, who has only in recent weeks emerged from international seclusion after taking power six years ago and super-charging North Korea’s push to become a nuclear power. Kim met last month with China’s president and is to meet South Korea’s leader April 27.

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Associated Press writers Zeke Miller in Palm Beach, Florida, and Lisa Mascaro, Deb Riechmann and Matthew Lee in Washington and Gillian Wong in Beijing contributed to this report.

New York attorney general wants power to bypass Trump pardons

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(PhatzNewsRoom / Reuters)   —   New York’s attorney general on Wednesday asked Governor Andrew Cuomo and state legislators to give him and other local prosecutors power to bring criminal charges against people pardoned by U.S. President Donald Trump.

In a letter, Attorney General Eric Schneiderman urged Cuomo and legislative leaders to close a loophole in New York’s double jeopardy law shielding recipients of presidential pardons from state prosecution.

A change could make it more difficult for Trump aides and others who might be pardoned to escape criminal prosecution, even if special counsel Robert Mueller’s probe into possible Russian interference in the 2016 presidential election were curbed or shut down.

The president has no constitutional power to pardon state crimes, but Schneiderman said the current law means defendants pardoned for serious federal crimes could be freed from “all accountability” under state criminal law.

Schneiderman, a Democrat in his eighth year as attorney general, has made his office a central figure in blue state challenges to Trump, tangling with the Republican president on such matters as consumer finance, the environment, immigration and the 2020 census.

The White House had no immediate comment.

Cuomo, a Democrat, is reviewing Schneiderman’s proposal, and “believes that the federal legal system should not provide a basis for any wrong doers to escape justice,” press secretary Dani Lever said in a statement.

Democratic State Assembly Speaker Carl Heastie said “we will take a close look” at the “serious” issue, and State Senator Todd Kaminsky, also a Democrat, tweeted a plan to introduce a bill closing the loophole.

It is unclear if a revised law can make it through the state senate, which is closely divided between Republicans and Democrats. The office of Republican Senate Majority Leader John Flanagan did not immediately respond to a request for comment.

Double jeopardy laws prevent people from being tried twice for the same crime.

“By closing New York’s double jeopardy loophole, lawmakers can ensure that no one accused of breaking New York’s laws will escape accountability merely because of a strategically-timed presidential pardon,” Schneiderman said in a statement.

Jed Shugerman, a Fordham University law professor, said Schneiderman’s “balanced” proposal both protects people from “repeated harassment” by a single group of prosecutors, and also “protects against pardons being used to obstruct justice.”

He said its adoption would bring New York law in line with laws of several other U.S. states.

Schneiderman said more than 20 states provide defendants only the minimum required protection against double jeopardy.

Some onetime Trump aides have pleaded guilty in Mueller’s probe, including former national security adviser Michael Flynn and former campaign adviser Rick Gates.

Trump has called the probe a witch hunt. His personal lawyer Michael Cohen faces a separate criminal investigation that arose from it.

Last week, Trump pardoned Lewis “Scooter” Libby, a onetime chief of staff to former Vice President Dick Cheney, over his role in the unmasking of CIA agent Valerie Plame.

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(Reporting by Jonathan Stempel and Jan Wolfe in New York; Editing by David Gregorio and Tom Brown)

Puerto Rico power outage still affecting majority of residents

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(PhatzNewsRoom / CNN)   —   With most of Puerto Rico in the dark Wednesday night, Gov. Ricardo Rossello said in a tweet that he has suggested Puerto Rico’s Electric Power Authority cancel its contract with a subcontractor that caused an island-wide power outage.

An excavator operated by D. Grimm, a subcontractor for Cobra Acquisitions, apparently caused the blackout, which originated at a major transmission line running between Salinas and Guayama in the southeast, according to the authority.

The same company was responsible for an outage that affected 870,000 customers after a tree fell on a power line last week, PREPA said.

Mammoth Energy, Cobra’s parent company, said workers were removing a fallen tower when the machine got too close to an energized line and an electrical ground fault caused the outage.

As of 8 p.m., only 334,000 customers in the US commonwealth had electricity again. Power was to be restored to customers who had electricity before the latest outage within 24 to 36 hours, the authority said.

This is the latest setback as power officials try to restore power to the nearly 1.4 million customers who lost electric service during Hurricane Maria nearly seven months ago. Most of the island had had its power restored as the commonwealth rebuilt its decimated electrical grid.

Hospitals first

The utility said its priority Wednesday was to bring back service to medical facilities, water pumping systems and financial institutions.

Video and photos posted on social media showed rapid transit line workers helping down passengers from stalled trains and college students registering for classes during the blackout. Long lines of cars formed at gas stations and a fire broke out in an electrical generator behind a restaurant in the Condado tourist district.

“Seven months after Maria, we are back where Maria left us,” Cynthia Garcia Coll, a professor at Carlos Albizu University in San Juan, said via email.

Rafael Santiago, an engineer at a plant that makes prosthetic devices, said via Twitter that he and other workers were evacuated after being locked inside for about 20 minutes while electric generators were started.

San Juan Mayor Carmen Yulin Cruz, a frequent critic of recovery efforts since the September hurricane, worried that Puerto Rico won’t be prepared for the upcoming hurricane season.

“Today’s total power outage in Puerto Rico pinpoints the fact that we are still in a very fragile state. Moreover, the suffering of the Puerto Rican people seems to be nowhere nearing an end,” she said.

Play ball!

But the mayor said backup systems and mobile tower lights allowed Wednesday night’s baseball game between the Cleveland Indians and Minnesota Twins to go on as planned at Hiram Bithorn Stadium.

“Nothing will stop us,” she tweeted.

Puerto Rico, home to more than 3 million US citizens, has grappled with widespread power outages for months since Hurricane Maria devastated the Caribbean island.

Puerto Rico’s power outage is now the second-largest blackout in history

Puerto Rico has lost 3.4 billion customer-hours of electricity service due to Maria, according to an analysis released last week by the economic data analytics and policy firm Rhodium Group.

It’s the largest blackout in US history (in terms of customer hours) and the second largest in the world — after the outage caused when Typhoon Haiyan tore through the Philippines in 2013, killing more than 6,000 people.

Puerto Rico’s power authority faced widespread criticism late last year for signing a $300 million contract to restore power with Whitefish Energy Holdings, a small Montana-based firm with only two employees at the time.

The utility canceled the contract amid public outcry, and its executive director stepped down in November.

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CNN’s Natalie Gallón and Steve Almasy contributed to this report.

FAA orders fan blade inspections after jet engine explosion

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PHILADELPHIA (AP) — U.S. airline regulators have ordered inspections on engine fan blades like the one that snapped off a Southwest Airlines plane, leading to the death of a woman who was partially blown out a window.

The Federal Aviation Administration’s announcement late Wednesday comes nearly a year after the engine’s manufacturer recommended the additional inspections, and a month after European regulators ordered their airlines to do the work.

Pressure for the FAA to act grew after an engine on a Southwest plane blew apart on Tuesday, showering the aircraft with debris and shattering a window. A woman sitting next to the window was partially blown out and died of her injuries. The plane, which was headed from New York to Dallas, made an emergency landing in Philadelphia.

Investigators said a blade that broke off mid-flight and triggered the fatal accident was showing signs of metal fatigue — microscopic cracks that can splinter open under the kind of stress placed on jetliners and their engines.

The National Transportation Safety Board also blamed metal fatigue for an engine failure on a Southwest plane in Florida in 2016.

That led manufacturer CFM International, a joint venture of General Electric Co. and France’s Safran SA, to recommend last June that airlines conduct the inspections of fan blades on many Boeing 737s.

Marty Martinez was heading home to Dallas on board Southwest Airlines Flight 1380 when he heard what he described as two explosions and the oxygen masks dropped. That’s when he paid for Internet access, pulled up Facebook and began recording. (April 18)

The FAA proposed making the recommendation mandatory in August but never issued a final decision.

On Wednesday, the FAA said it would issue a directive in the next two weeks to require ultrasonic inspections of fan blades on some CFM56-7B engines after they reach a certain number of takeoffs and landings. Blades that fail inspection would need to be replaced.

It was not immediately clear how many planes would be affected. Last year, the FAA estimated that an order would cover 220 engines on U.S. airlines. That number could be higher now because more engines have hit the number of flights triggering an inspection.

Southwest announced its own program for similar inspections of its 700-plane fleet over the next month. United Airlines executives said Wednesday that they had begun inspecting some of their planes.

American Airlines has about 300 planes with that type of engine, and Delta Air Lines has about 185. It will not be clear until the FAA issues its rule how many will need inspections.

Tuesday’s emergency broke a string of eight straight years without a fatal accident involving a U.S. airliner.

“Engine failures like this should not occur,” Robert Sumwalt, chairman of the NTSB, said Wednesday.

Sumwalt expressed concern about such a destructive engine failure but said he would not yet draw broad conclusions about the safety of CFM56 engines or the entire fleet of Boeing 737s, the most popular airliner ever built.

Federal investigators were still trying to determine how a window came out of the plane. The woman sitting next to it, identified by family members as 43-year-old Jennifer Riordan, was wearing a seat belt. Philadelphia’s medical examiner said the banking executive and mother of two from Albuquerque, New Mexico, died from blunt impact trauma to her head, neck and torso.

It is unknown whether the FAA’s original directive would have forced Southwest to quickly inspect the engine that blew up. CEO Gary Kelly said it had logged only 10,000 cycles since being overhauled.

Before Wednesday’s announcement, critics accused the FAA of inaction in the face of a threat to safety.

Robert Clifford, a lawyer who is suing American Airlines over another engine explosion that caused a fire that destroyed the plane, said the FAA should have required the inspections — even if it meant grounding Boeing 737s.

“There is something going on with these engines,” he said, “and the statistical likelihood of additional failures exists.”

William Waldock, a safety expert at Embry-Riddle Aeronautical University, predicted the FAA’s decision. He said the scope of FAA action will depend on whether investigators find fatigue in other fan blades on the broken engine.

“The first thing they probably are going to do is pull every single one of those other blades off and X-ray them to see if they’ve got a similar type of failure waiting to happen,” he said.

The Southwest CEO protested that it is too soon to say whether Tuesday’s accident is related to any other engine failures.

Kelly said the plane was inspected on Sunday and nothing appeared out of order. A spokeswoman said it was a visual inspection and oil service of the engines. The NTSB’s Sumwalt said, however, that the kind of wear seen where the missing fan blade broke off would not have been visible just by looking at the engine.

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AP Airlines Writer David Koenig reported from Dallas.

Starbucks incident highlights perils of shopping while black

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PHILADELPHIA (AP) — It was a surreal scene that is part of daily life for many black Americans and minorities, an everyday moment gone wrong, ending in complete humiliation.

Two black men were handcuffed and arrested at a Starbucks, setting off a national uproar after the incident was captured on video. A worker complained the men were trespassing, but they maintained they were doing what thousands of people do in the popular coffee shops across the country — waiting to meet a friend.

The exchange was a fresh reminder that, five decades after the end of legal segregation, to be black in America is to be constantly challenged in certain spaces in ways white Americans scarcely have to consider, simply to get through the day without being hassled.

The term used to describe encounters like the one at the Starbucks is “retail racism,” also known as “shopping while black.” It happens when minority customers are treated differently than white customers through a variety of indignities and slights, such as being refused service, falsely accused of shoplifting or reported to security or police over something mundane.

“It is about a perception that black people are undesirable in a given location,” said Princeton University African-American studies professor Imani Perry. “Having to perform being non-threatening … it’s exhausting, and it is a commonplace expectation.”

Starbucks announced Tuesday that it would close its 8,000 U.S. stores for several hours next month to conduct racial-bias training for its nearly 175,000 workers. The company — known as an inclusive and progressive workplace — has been responsive in the wake of the April 12 incident, and CEO Kevin Johnson came to Philadelphia and met with the two men who were arrested. Within hours, Philadelphia Mayor Jim Kenney condemned the incident, saying it “appears to exemplify what racial discrimination looks like in 2018,” and prosecutors declined to bring charges against the men.

Research and surveys show that “retail racism” remains prevalent, and many black Americans have had their own “Starbucks moment” in establishments across the country. It’s a phenomenon not limited by race, age, or gender, affecting even billionaire Oprah Winfrey — turned away at a Paris Hermes shop in 2003 — and former President Barack Obama, who spoke from the White House in the wake of the George Zimmerman acquittal in 2013 about his experiences as a younger man of being followed in stores and doors locking as he passed by.

The Starbucks encounter wasn’t shocking or surprising for black men like Ameen Akbar. Instead, it felt routine.

Bald-headed, bearded, with a Muslim name, Akbar has sensed being followed in high-end stores when he has worn a hoodie or Timberland boots to shop on weekends. He’s aware of the different look he gets in the same parking lot when he goes to work in a suit, versus showing up in more comfortable clothing.

“I’m hyper-aware of when I’m in these spaces and what that impact can be and how I say things,” said Akbar, 40, a Philadelphia native. “If you’ve been doing it for a lifetime, it becomes part of who you are.”

In a 2016 Gallup poll, 52 percent of blacks and 17 percent of whites said they perceived discrimination in stores downtown or in the shopping mall. A study last year by Case Western professor Cassi Pittman found that such practices require black shoppers to navigate being seen as a threat to avoid harassment, humiliation or harm.

And at the core of the Black Lives Matter movement is the pattern of what the group sees as a criminalization of black people for doing everyday things. The movement received the most attention for protests following police shootings of unarmed black men, but its main mission focuses on erasing the underlying, systemic racism at the root of encounters like those at Starbucks.

As she watched a video of the arrests at the Starbucks, Black Lives Matter co-founder Patrisse Cullors thought immediately about the dignity of the two men during the incident.

“And I just watched those men acquiesce to being arrested, knowing that they have to cooperate and they couldn’t do anything else about it,” she said.

The Starbucks incident set off outrage in large part because it was captured on video, but many such slights are undocumented and unacknowledged. In Philadelphia, the exchange was marked not only with video proof, but by the indignation and attempted intervention of a pair of white bystanders.

The escalation of mundane encounters for African-Americans is not limited to their experience as consumers.

On the same day as the Starbucks arrests, a 14-year-old black boy who got lost in a Detroit suburban neighborhood on his way to school was shot at by a white homeowner after knocking on the man’s door to ask for directions. Recorded police shootings of unarmed black men in places like Ferguson, Baltimore and Charleston have had a similar dynamic.

Katie Adams said she has spent hours at her local Starbucks, sometimes drinking only free water — without incident.

“I’ve never been refused service for not making a purchase,” said Adams, a 32-year-old mom and student, who is white and lives in Hanford, California, outside of Fresno. “If my skin color was different, I feel like I would be approached.”

Adams said she was upset after watching the Starbucks video, calling the incident was “unfair and ridiculous.” Still, as a mini-storage employee, she said she has been aware of her own bias at times in dealing with customers but works to keep it in check.

“A lot of times I can feel myself saying, ‘I don’t want to rent to this person,’” Adams said. “As a white person, I have to tell myself, ‘This is a regular person, just like me.’ There’s no reason for me to assume anything until I’ve spoken with them and gotten to know them a little better. But as much as you don’t want to pre-judge someone it’s there. You’re going to do it, whether you act on it or not.”

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Whack is The Associated Press’ national writer for race and ethnicity. Follow her work on Twitter at http://www.twitter.com/emarvelous

Business: Asian shares, oil prices rise on upbeat global outlook

HONG KONG (AP) — Most Asian and European shares rose and oil prices touched fresh multi-year highs on Thursday as improving optimism about the global economy helped investors shake off worries about geopolitical risks for the moment.

KEEPING SCORE: European shares were mostly higher in early trading. Britain’s FTSE 100 rose 0.3 percent to 7,335.40 and France’s CAC 40 edged 0.1 percent higher to 5,387.97. Germany’s DAX slipped 0.1 percent to 12,577.06. Wall Street was poised to open slightly lower. Dow futures were less than 0.1 percent lower at 24,731.00 and broader S&P 500 futures dipped 0.1 percent to 2,707.70.

ASIAN SCORECARD: Japan’s benchmark Nikkei 225 index rose 0.2 percent to 22,2191.18 and South Korea’s Kospi added 0.3 percent to 2,486.10. Hong Kong’s Hang Seng jumped 1.4 percent to 30,708.44 and the Shanghai Composite in mainland China gained 0.8 percent to 3,117.38. Australia’s S&P/ASX 200 advanced 0.3 percent to 5,881.00. Shares were higher in Taiwan and most of Southeast Asia.

GLOBAL ECONOMY: The Federal Reserve’s latest beige book survey found the outlook for the world’s No. 1 economy remains positive as growth continues at a moderate pace, though trade tensions with China are an increasing concern. Investors are also keeping an eye on corporate earnings. Swiss pharmaceutical company Novartis reported first quarter net income jumped 12 percent on strong growth in some of its key drugs.

TRADE TENSIONS: President Donald Trump and Japanese Prime Minister Shinzo Abe said they agreed to start talks on a new “free, fair and reciprocal” trade agreement after two days of meetings in Florida. Abe failed to get the exemption from U.S. metal tariffs for Japan that he had hoped for but some analysts said the outcome signaled that Trump was taking a more conciliatory stance on trade. In Beijing, a Commerce Ministry spokesman said China hopes trade frictions with the U.S. won’t escalate but that “China has prepared for all the possibilities.”

MARKET INSIGHT: “I think overall sentiment today is continuing favorably as geopolitical risk diminishes, and perhaps we’re starting to see a definite de-escalation from Trump’s America First trade policy,” after the Trump-Abe meeting, said Stephen Innes, head of Asian trading at OANDA.

CRESTING CRUDE: Oil prices are at their highest levels since late 2014 after the latest report on U.S. inventories found that crude stockpiles fell sharply in a sign of stronger than expected demand. News reports citing industry sources saying Saudi Arabia would be happy to see prices hit $100 a barrel are also helping lift the rally and shares of energy companies. Chinese oil producer CNOOC Ltd. jumped 4.4 percent and Sinopec, China’s largest refiner, rose 2.4 percent in Hong Kong while Japan Petroleum Exploration advanced 2.6 percent.

ENERGY PRICES: Oil futures rose to their highest in nearly 3 ½ years. Benchmark U.S. crude gained 76 cents to $69.23 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.95, or 2.9 percent, to settle at $68.47 per barrel on Wednesday. Brent crude, used to price international oils, added 42 cents to $74.38 per barrel in London.

CURRENCIES: The dollar strengthened to 107.34 yen from Wednesday’s 107.24 yen. The euro slipped to $1.2372 from $1.2375.

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– Here are the top five things you need to know in financial markets on Thursday, April 19:

1. Metals surge on sanction worries

Nickel was on a tear on Thursday, soaring 4%, on fears that U.S. sanctions on major Russian aluminum producer Rusal may be broadened and could hit key Russian nickel supplier Nornickel.

Worries over over tighter global supply for a commodity already in deficit have seen nickel jump 20% just this week, while aluminum, also up around 2% on Thursday, has racked up gains of more than 30% so far this month.

2. Oil hits 3 ½-year high ahead of OPEC meeting

Amid the broad surge in commodities seen Thursday, oil prices also hit their highest level since late 2014 while traders looked ahead to the outcome of the joint Organization of Petroleum Exporting Countries (OPEC) and non-OPEC ministerial monitoring committee meeting slated for later this week.

The committee may discuss new inventory targets that extend their output cuts beyond this year as they aim to eliminate a glut.

The gathering will play out against a backdrop of falling stockpiles and geopolitical tensions that have lifted prices.

U.S. crude oil futures rose 0.82% to $69.03 at 5:52AM ET (9:52GMT), while Brent oil gained 0.87% to $74.12.

3. Jobless Claims, Philly Fed Data, Fed Jawboning Looms

The Labor Department releases its weekly count of the number of individuals who filed for unemployment insurance for the week ended April 13, expected to show jobless claims fell to 230,000 from 233,000 the prior week. Continuing claims are forecast to fall to 1.848 million from 1.871 million the prior week.

The report on the labor market is due Thursday at 8:30AM ET, a day after the Federal Reserve’s Beige Book showed that tightness in the labor market has yet to boost wage growth pressure.

Also released at the same time, economists forecast the Philly Fed manufacturing index for April to show a reading of 20.8, slightly below the 22.3 reading seen in March.

Furthermore, traders will pay close attention to appearances by Fed governor Lael Brainard at 8:00AM ET (12:00GMT), fellow Fed governor Randal Quarles at 9:30AM ET (13:30GMT)and Cleveland Fed president Loretta Mester at 6:45PM ET (22:45GMT)

The Fed speeches are likely to be closely monitored after St. Louis Fed chief James Bullard warned that the yield curve could invert– a key predictor of a recession – within six months.

Traders are currently pricing in around a 95% chance of a rate hike in June, according to Investing.com’s Fed Rate Monitor Tool. Odds of a third rate hike by December was seen at about 85%.

4. Earnings will continue to be in focus

Earnings will continue to move stock prices with Wall Street set to trade good news as all six S&P 500 firms reporting after the prior session’s close beat estimates.

Of particular note, American Express (NYSE:AXP) looked set for solid gains after the blue chip credit card issuer’s profit topped consensus as record investments in card rewards and a strengthening U.S. economy contributed to higher customer spending.

First quarter earnings season is running smoothly with 83% of the 58 S&P companies that have reported beat both profit and sales estimates, according to The Earnings Scout.

On Thursday’s docket, Procter & Gamble, Bank of New York Mellon (NYSE:BK), BB&T (NYSE:BBT), Blackstone (NYSE:BX) and Philip Morris are among firms reported earnings.

5. Stocks set for weak open ahead of earnings, data

U.S. futures pointed to a slightly lower open on Thursday as investors waited for earnings and economic data to give direction for the day’s trade. At 5:54AM ET (9:54GMT), the blue-chip Dow futures was unchanged, S&P 500 futures slipped 3 points, or 0.09%, while the Nasdaq 100 futures edged down 3 points, or 0.04%.

Elsewhere, European shares were running out of steam following a two-day rally with most of the major bourses showing little change. A notable exception was the FTSE 100 trading up 0.2% as the commodity rally pushed up shares in mining giants and oil producers.

Earlier, Asian equities ended higher on the back of bullish sentiment in resource stocks.

NTSB: Blown Southwest jet engine showed ‘metal fatigue’

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PHILADELPHIA (AP) — A preliminary examination of the blown jet engine of the Southwest Airlines plane that set off a terrifying chain of events and left a businesswoman hanging half outside a shattered window showed evidence of “metal fatigue,” according to the National Transportation Safety Board.

Passengers scrambled to save the woman from getting sucked out the window that had been smashed by debris. She later died, and seven others were injured.

The pilots of the twin-engine Boeing 737 bound from New York to Dallas with 149 people aboard took it into a rapid descent Tuesday and made an emergency landing in Philadelphia. Oxygen masks dropped from the ceiling and passengers said their prayers and braced for impact.

“I just remember holding my husband’s hand, and we just prayed and prayed and prayed,” said passenger Amanda Bourman, of New York.

The dead woman was identified as Jennifer Riordan, a Wells Fargo bank executive and mother of two from Albuquerque, New Mexico. The seven other victims suffered minor injuries.

The National Transportation Safety Board sent a team of investigators to Philadelphia.

In a late night news conference, NTSB chairman Robert Sumwalt said one of the engine’s fan blades was separated and missing. The blade was separated at the point where it would come into the hub and there was evidence of metal fatigue, Sumwalt said.

The head of Southwest Airlines says that there were no problems with a plane involved in a fatal emergency landing when it was inspected two days ago. (April 17)

The engine will be examined further to understand what caused the failure. The investigation is expected to take 12 to 15 months.

Photos of the plane on the tarmac showed a missing window and a chunk gone from the left engine, including part of its cover. A piece of the engine covering was later found in Bernville, Pennsylvania, about 70 miles (112 kilometers) west of Philadelphia, Sumwalt said.

As a precaution, Southwest said Tuesday night that it would inspect similar engines in its fleet over the next 30 days.

Passengers praised one of the pilots, Tammie Jo Shults, for her cool-headed handling of the emergency. The former Navy pilot was at the controls when the plane made the emergency landing. She walked through the aisle and talked with passengers to make sure they were OK after the aircraft touched down.

“She has nerves of steel. That lady, I applaud her,” said Alfred Tumlinson, of Corpus Christi, Texas. “I’m going to send her a Christmas card, I’m going to tell you that, with a gift certificate for getting me on the ground. She was awesome.”

In a recording of conversations between the cockpit and air traffic controllers, an unidentified crew member reported that there was a hole in the plane and “someone went out.”

Tumlinson said a man in a cowboy hat rushed forward a few rows to grab the woman and pull her back in.

“She was out of the plane. He couldn’t do it by himself, so another gentleman came over and helped to get her back in the plane, and they got her,” he said.

Passengers struggled to somehow plug the hole while giving the badly injured woman CPR.

As the plane came in for a landing, everyone started yelling to brace for impact, then clapped after the aircraft touched down safely, Bourman said.

Southwest CEO Gary Kelly said there were no problems with the plane or its engine when it was inspected on Sunday.

The jet’s CFM56-7B engines were made by CFM International, jointly owned by General Electric and Safran Aircraft Engines of France. CFM said in a statement that the CFM56-7B has had “an outstanding safety and reliability record” since its debut in 1997.

Last year, the engine maker and the Federal Aviation Administration instructed airlines to make ultrasonic inspections of the fan blades of engines like those on the Southwest jet. The FAA said the move was prompted by a report of a fan blade failing and hurling debris. A Southwest spokeswoman said the engine that failed Tuesday was not covered by that directive, but the airline announced it would speed up ultrasonic inspections of fan blades of its CFM56-series engines anyway.

“There’s a ring around the engine that is meant to contain the engine pieces when this happens,” said John Goglia, a former NTSB member. “In this case it didn’t. That’s going to be a big focal point for the NTSB — why didn’t (the ring) do its job?”

In 2016, a Southwest Boeing 737-700 blew an engine as it flew from New Orleans to Orlando, Florida, and shrapnel tore a 5-by-16-inch hole just above the wing. The plane landed safely. The NTSB said a fan blade had broken off, apparently because of metal fatigue.

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Koenig reported from Dallas. Associated Press writers Kristen de Groot and Claudia Lauer in Philadelphia; Susan Montoya in Albuquerque, New Mexico; and Matthew Barakat in Washington, contributed to this story, along with AP researchers Monika Mathur and Jennifer Farrar.

Ahead of summit, CIA chief secretly meets with NKorea’s Kim

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WASHINGTON (AP) — CIA Director Mike Pompeo recently traveled to North Korea to meet with leader Kim Jong Un, a highly unusual, secret visit undertaken as the enemy nations prepared for a meeting between President Donald Trump and Kim within the next few months.

Two officials confirmed the trip to The Associated Press on Tuesday. The officials were not authorized to discuss the visit publicly and spoke on condition of anonymity.

The Washington Post, which first reported Pompeo’s meeting with Kim, said it took place over Easter weekend — just over two weeks ago, shortly after the CIA chief was nominated to become secretary of state.

Trump, who was hosting Japan’s Prime Minister Shinzo Abe at his Florida estate, said the U.S. and North Korea were holding direct talks at “extremely high levels” in preparation for a possible summit with Kim. He said five locations were under consideration for the meeting, which was slated to take place by early June.

White House press secretary Sarah Huckabee Sanders said Trump and Kim had not spoken directly.

Kim’s offer for a summit was initially conveyed to Trump by South Korea last month, and the president shocked many by accepting it. U.S. officials indicated over the past two weeks that North Korea’s government had communicated directly with Washington that it was ready to discuss its nuclear weapons program.

It would be the first-ever summit between U.S. and North Korea during more than six decades of hostility since the Korean War. North Korea’s nuclear weapons and its capability to deliver them by ballistic missile pose a growing threat to the U.S. mainland.

The U.S. and North Korea do not have formal diplomatic relations, complicating the arrangements for contacts between the two governments. It is not unprecedented for U.S. intelligence officials to serve as a conduit for communication with Pyongyang.

In 2014, then-Director of National Intelligence James Clapper secretly visited North Korea to bring back two American detainees.

At his confirmation hearing last week to become secretary of state, Pompeo played down expectations for a breakthrough deal on ending North Korea’s nuclear weapons at the planned Trump-Kim summit, but he said it could lay the groundwork for a comprehensive agreement on denuclearization.

“I’m optimistic that the United States government can set the conditions for that appropriately so that the president and the North Korean leader can have that conversation and will set us down the course of achieving a diplomatic outcome that America and the world so desperately need,” Pompeo told the Senate Foreign Relations Committee.

After a year of escalating tensions, when North Korea conducted nuclear and long-range missile tests that drew world condemnation, Kim has pivoted to international outreach.

The young leader met China’s President Xi Jinping in Beijing in late March, Kim’s first trip abroad since taking power six years ago. He is set to meet South Korean President Moon Jae-in in the demilitarized zone between the rival Koreas on April 27.

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Associated Press writer Matthew Pennington contributed to this report.

Delays keep inspectors from reaching Syria attack site

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BEIRUT (AP) — International chemical weapons inspectors do not appear to have visited the site of a suspected attack in Syria after days of delays by Syrian and Russian authorities.

Syrian state media reported Tuesday that inspectors from the Organization for the Prohibition of Chemical Weapons had entered the town of Douma, but Syria’s U.N. ambassador, Bashar Ja’afari, later said that only a U.N. advance security team had entered.

The U.S. State Department has accused the Syrian government and its ally Russia of trying to cover up the alleged April 7 attack. Spokeswoman Heather Nauert said Tuesday the U.S. did not believe the inspectors had entered Douma, and that the evidence is at risk of decaying as delays drag on.

There was no comment from the OPCW or the U.N. on Wednesday.

— Residents of the Syrian town of Douma were packed into underground shelters amid bombardment when the gas began to spread. Suddenly, panic ensued.

As shouts of “chlorine, chlorine!” rang out, some ran into the night and fainted in the street. Others climbed to rooftops, hoping they’d be safer rising above the gas. Dozens didn’t make it out at all, some stumbling on stairwells, out of breath, where they were later found dead.

The bodies were still there the next morning, strewn around the buildings, including toddlers and young children.

Much about the April 7 suspected chemical attack in Douma, just east of Damascus, remains unknown, including the exact death toll, because of the lack of an independent investigation.

International chemical weapons inspectors were said to have entered the town on Tuesday, 10 days after the attack, but the Syrian government said Wednesday that only an advance security team had entered, amid U.S. accusations that Syria and its ally Russia were blocking their entry to cover up evidence.

The Associated Press spoke to rescuers, medics and numerous residents of Douma for their accounts of what took place. Some were reached in rebel-held areas in northern Syria where they were evacuated after the attack, while others were still in Douma.

They spoke of at least two buildings with people sheltering in the basements that were overwhelmed with gas so strong that it was hard to breathe hundreds of meters (yards) away.

More than 40 people were killed, many of them children, according to medics and opposition activists in the town. The World Health Organization said an estimated 500 patients exhibited symptoms consistent with exposure to toxic chemicals, including respiratory failure.

It was hardly the first chemical attack in Syria’s civil war , now more than seven years old. The U.N.-mandated Independent International Commission on Syria has documented more than 30 chemical attacks in Syria between 2013 and the end of 2017 — at least 25 of them carried out by the Syrian military, the commission says. For the rest, it had insufficient evidence to determine the perpetrator. Most involved chlorine gas, usually causing only a few injuries.

But in this case, it appeared the gas hit dozens of people crammed into confined spaces, huddling away from the bombs outside. The U.S. and France say they have evidence the Syrian government carried out the April 7 strike, while Syria and Russia have denied any gas attack even took place.

An AP team visited the site on a Syrian government-organized tour Monday, including a two-room underground shelter where one resident said 47 people were killed, including his pregnant wife and two young daughters.

A strange smell lingered, nine days after the attack. The floors of the shelter were covered with carpets and pillows were lined up against a wall. There were no signs of blood stains.

___

A STRANGE SMELL, THEN PEOPLE RUNNING AND SCREAMING

There had been bombings going on all day, and in the evening, a heavy volley of rockets hit, dozens within 10 minutes, said Ahmed, a 20-year-old medic.

After the rocket fire subsided, he and his team moved in to check for wounded. Nearing the site, they encountered a powerful smell, then saw people running and screaming, “Chlorine! Chlorine!”

Ahmed ran into the building, trying to reach the shelter. He didn’t make it far. He saw two bodies, a man and a woman, but he couldn’t go further. His eyes swollen from the fumes, he struggled to breathe. Everywhere was the overpowering smell of chlorine, he said, speaking on condition he be identified only by his first name out of fear for his safety and that of his family.

He rushed to a nearby medical center, where hundreds were crowded, many gasping for breath. Some had fainted. After washing his face and recovering, he joined other medics and went back to the attack site, but the gas was still too strong to get close. Instead they went back and forth helping those who had managed to stagger out get to the medical center.

“After an hour and a half, I couldn’t do more,” said. “I was in bad shape. I had to rest.”

Soon after the attack, Ahmed was among thousands evacuated from Douma as the town surrendered to government forces.

He believes the attack was clearly carried out by Syrian government forces. “It was like an earthquake,” he said, speaking to the AP from northern Syria. “The town was facing an earthquake.”

___

“IT’S CHLORINE! IT’S CHLORINE!”

Men and women were preparing to perform the sunset Muslim prayers in an underground shelter when an overpowering smell started spreading.

“It’s chlorine! It’s chlorine!” they screamed.

Khaled Nuseir was in the two-room shelter with 51 other people when the fumes hit. He ran to a nearby clinic, calling for paramedics to help, but fainted in the clinic.

The 25-year-old vegetable vendor said he woke up some time later to people putting vinegar and water on his face. He ran back to the shelter where he found his wife and two daughters dead, white foam covering their mouths.

His wife, Fatmeh Qarout, was nine months pregnant. His daughters, Qamar — Arabic for moon — and Nour — Arabic for light — were 18 months and 2 ½ years old. He said only five people in the shelter survived.

The next morning, medics came and took the bodies and buried them in a mass grave near the town’s zoo.

Nuseir said a cylinder was found leaking gas. He said it didn’t appear that it was dropped from the air because it still looked intact. “There was no sound of explosion,” he said, speaking to the AP in Douma, which is now in government hands.

He and two other residents accused the rebel Army of Islam, which controlled Douma until the militants’ surrendered it, of carrying out the attack. As they spoke, government troops were nearby, but out of earshot.

“I lost my children,” Nuseir said. “If we are standing here and something falls from an aircraft, doesn’t it explode? The cylinder was intact when we found it and it was leaking.”

___

“NOTHING SAVED THEM. THEY ALL LOST THEIR LIVES.”

Abdullah Abu Hamam tried to reach the site of the attack that night but the bombardment was too strong. He got there the next morning. Even 12 hours later, the gas was too powerful for him to venture into the underground shelters.

Still, he found bodies on all the upper floors. It was clear that when the gas hit, some in the shelters ran upstairs, trying to get to the rooftops.

“They knew that if they climbed up, they might be saved,” he said. “We found them on the doorstep, killed. They didn’t even make it to the upper floors. …They fell on the stairs, women and children, and even some men.”

Abu Humam took video footage that showed one apartment with at least a dozen bodies, including at least seven toddlers and young children. None had any wounds, and one woman in the footage appeared to have foam around her mouth

“Some were in the bathroom and were trying to wash, but nothing saved them. They all lost their lives,” Abu Humam said, speaking from the rebel-held town of al-Bab in northern Syria.

___

Associated Press writer Bassem Mroue in Douma, Syria, contributed to this report.

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