The daily business briefing: August 11, 2016

1. Record Saudi output drags down oil prices

Crude oil prices extended their losses early Thursday as fears over a global glut deepened following reports of growing oil stocks in the U.S. and record output in Saudi Arabia. The International Energy Agency, however, issued a report predicting that pent-up demand would absorb oversupply in coming months, steadying prices later in the morning. The IEA also cut its projection for demand growth due to weakening global economic growth in 2017. The glut has dragged oil prices from $115 a barrel in June 2014 to a low of $27 in January 2016. Prices are now are hovering just above $41.

Reuters Bloomberg

2. Valeant Pharmaceuticals faces fraud investigation

Federal prosecutors in New York have launched an investigation of Valeant Pharmaceuticals International on suspicion that it had defrauded insurers by hiding ties to a mail-order pharmacy that helped it increase sales, The Wall Street Journal reported Wednesday, citing people familiar with the matter. A Valeant spokeswoman said in a statement that the company "has been cooperating and continues to cooperate with the ongoing Southern District of New York investigation." The investigation could result in criminal charges against Valeant as a company, and against former executives at the now-defunct pharmacy, Philidor Rx Services. Valeant shares dropped by nearly 10 percent in pre-market trading.

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The Wall Street Journal Bloomberg

3. Job openings rise as U.S. approaches full employment

Job openings rose in June as layoffs fell to their lowest in almost two years, the Labor Department reported Wednesday. Job openings rose by 110,000 to a seasonally adjusted 5.6 million. The figures support Fed officials' determination that the U.S. economy is near full employment. "This report continues to point to a tight labor market," said economist John Ryding of RDQ Economics. "It is clear that demand for labor is not the problem."

Reuters

4. Court says FCC can't ban state limits on broadband expansion

A federal appeals court ruled Wednesday the Federal Communications Commission can't prevent Tennessee and North Carolina from setting limits on municipal broadband expansion. The decision amounted to a significant victory for broadband providers, and a setback for FCC Chairman Tom Wheeler, who said placing limits on broadband expansion to areas with poor internet service would "halt the promise of jobs, investment, and opportunity."

Reuters

5. Australian government backs Chinese takeover of power company

Australia on Thursday rejected bids from Hong Kong and mainland Chinese groups for a controlling stake in a power company — Ausgrid — serving Sydney and neighboring areas, citing security concerns. Australia's economic health is already closely linked to China, partly because key sectors of its economy, such as mining and agriculture, depend on sales to China. The Australian government, however, has become wary of China's direct influence following a series of Chinese takeovers of local companies.

The New York Times