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The daily business briefing: January 23, 2019

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Harold Maass
The Huawei sign in Vegas
David Becker/Getty Images
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1.

Tensions rise ahead of key U.S.-China trade meeting

The White House reportedly rejected a preliminary meeting China proposed for this week ahead of looming high-level trade talks, signaling a lack of progress on some critical issues still dividing the world's two biggest economies. The news, along with fresh signs the global economy is weakening, broke a four-day winning streak for the main U.S. stock indexes. President Trump's top economic adviser, Larry Kudlow, denied that any scheduled meeting with Chinese government representatives had been canceled as the two countries try to reach a deal before a truce on new tariffs expires on March 1. Kudlow, director of the National Economic Council, said the high-level meeting in Washington next week would be "very, very important" and "determinative." [CNBC, CNN]

2.

DOJ pushes ahead with Huawei leader extradition request

The Justice Department said Tuesday it would move forward with plans to extradite Meng Wanzhou, chief financial officer of China's Huawei Technologies, to face allegations that she misrepresented the company's ties to a firm that tried to sell equipment to Iran despite U.S. sanctions. Meng was arrested in Canada in December. "We will continue to pursue the extradition of defendant Ms. Meng Wanzhou, and will meet all deadlines set by the U.S./Canada Extradition Treaty," Justice Department spokesman Marc Raimondi said in a statement. Huawei, the world’s biggest producer of telecommunications equipment, also faces allegations that its devices present a national security risk because they can be used to spy for Beijing. Huawei denies any involvement in espionage. [Reuters]

3.

IRS absences could delay tax refunds

Union leaders said Tuesday that the number of Internal Revenue Service employees skipping work will surge if the five-week partial government shutdown drags on, threatening to delay taxpayer refunds. The Trump administration last week ordered 30,000 more IRS workers to return to work without pay, part of an effort to process refunds on time as income-tax filing season begins. But Tony Reardon, president of the National Treasury Employees Union, and many local union leaders said more IRS employees across the country soon will be staying home, some in protest and others out of financial necessity. The absences are part of a broader pushback by civil servants, including Transportation Security Administration airport inspectors, who are calling in sick as they face their second straight pay day without a check. [The Washington Post]

4.

Comcast shares jump after it posts better-than-expected earnings

Comcast shares rose by 3.2 percent in pre-market trading early Wednesday after the company reported quarterly revenue and profit that beat analysts' expectations. The massive cable provider said its revenue rose by 26.1 percent to $27.85 billion in the fourth quarter, or $28.3 billion on an adjusted basis. Analysts had expected $27.6 billion, according to IBES data from Refinitiv. The company earned 64 cents per share, excluding items, beating the average estimate of 62 cents per share. The company said it lost 29,000 video customers, fewer than the 62,000 customer loss analysts had predicted, according to FactSet. [CNBC, Reuters]

5.

L.A. teachers ratify deal to end strike

Los Angeles teachers ratified a contract deal with the L.A. Unified School District on Tuesday, ending their first strike in 30 years. Alex Caputo-Pearl, president of United Teachers Los Angeles, said the agreement sealed "historic" gains in the fight for smaller classes and "fully staffed" schools. Teachers will get a 6 percent raise, although they said the walkout was about a broader need for more resources on campuses. Other elements of the deal include incremental reductions in class sizes over the next few years, and increases in support staff, including librarians. The votes of the 30,000 teachers union members were still being counted Tuesday night, but "a vast supermajority are voting yes for the agreement that we made," Caputo-Pearl said. [Los Angeles Times]