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Tuesday, April 30, 2019

Venezuela's Guaido calls for 'largest march in history' in uprising effort

Venezuelan opposition leader and self-proclaimed acting president Juan Guaido (C) speaks to supporters next to high-profile opposition politician Leopoldo Lopez, who had been put under home arrest by Venezuelan President Nicolas Maduro's regime, and members of the Bolivarian National Guard who joined his campaign to oust Maduro, in Caracas on April 30, 2019.

Cristian Hernandez | AFP | Getty Images

Venezuelans were expected to take to the streets on Wednesday for what opposition leader Juan Guaido pledged would be the "largest march" in the country's history, a day after he called for the military to oust President Nicolas Maduro.

In his boldest effort yet to gain the support of the armed forces, Guaido appeared early Tuesday morning outside a Caracas air force base with dozens of National Guard members. That triggered a day of violent protests, leaving more than 100 injured but without any concrete signs of defection from the armed forces leadership.

"We know that Maduro does not have the backing or the respect of the armed forces," Guaido said in a video message posted to his social media accounts on Tuesday evening. "We have seen that protest yields results. We should keep up the pressure."

Whether the protest turnout meets those lofty hopes will provide a key test for Guaido, as some supporters grow frustrated that Maduro remains in office more than three months after Guaido — who leads the opposition-controlled National Assembly — invoked the constitution to assume an interim presidency, arguing Maduro's May 2018 re-election was illegitimate.

While Guaido earned the backing of the United States and most Western countries, the armed forces have stood by Maduro, who retains the support of allies like Russia, China and Cuba. That has frustrated Guaido's bid to assume the day-to-day functions of government on an interim basis - which he says would be a prelude to calling new elections.

Venezuelan living standards have declined even further in the first several months of the year, with a series of blackouts and water shortages adding to hyperinflation and chronic shortages of food and medicine that have prompted millions to emigrate.

"I hope this will be the last time we have to take to the streets," said Claudia Riveros, a 36-year-old bakery worker carrying a Venezuelan flag during Tuesday's protest. "I want to see the end of this usurping government."

Maduro, a socialist who calls Guaido a U.S. puppet seeking to orchestrate a coup against him, has also called on supporters to march on Wednesday.

"Tomorrow, the first of May, we will have a large, millions-strong march of the working class," Maduro said in a Tuesday night television address. "We have been confronting different types of aggression and attempted coups never before seen in our history."

Guaido's choice of International Workers' Day for a major march comes as he is making appeals to union leaders and public workers, a traditional base of support for Maduro and his predecessor and mentor, the late President Hugo Chavez.

"If he does get some degree of participation from labor movements, then that can be an additional feather in his cap," said Risa Grais-Targow, the Latin America director at Eurasia Group in Washington, adding that the march would be "a significant barometer of his support and capacity to mobilize."

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China and US kick off latest trade talks after 'nice' working dinner

Chinese Vice Premier Liu He (R), US Treasury Secretary Steven Mnuchin (C) and Trade Representative Robert Lighthizer pose before they proceed to their meeting at the Diaoyutai State Guesthouse in Beijing on May 1, 2019.

ANDY WONG | AFP | Getty Images

China and the United States began their latest talks in Beijing on Wednesday aimed at ending a bitter trade war, after U.S. Treasury Secretary Steven Mnuchin said he had a "nice" working dinner the night before with China Vice Premier Liu He.

Mnuchin, along with U.S. Trade Representative Robert Lighthizer, are holding a full day of discussions, before Liu goes to Washington next week for another round of talks in what could be the end game for negotiations.

Liu greeted Mnuchin and Lighthizer as they arrived at a state guest house in Beijing and the three men exchanged pleasantries, but did not make comments directly to reporters.

"Nice to see you, it's good to be back here," Mnuchin told Liu. They then all went straight into the meeting room. Liu had entertained his U.S. guests on Tuesday night just after they arrived.

"We did. We had a nice working dinner, thank you," Mnuchin told reporters at his Beijing hotel, when asked if he had met with Liu on Tuesday. He did not elaborate.

Beijing and Washington have cited progress on issues including intellectual property and forced technology transfer to help end a conflict marked by tit-for-tat tariffs that have cost both sides billions of dollars, disrupted supply chains and roiled financial markets.

But U.S. officials say privately that an enforcement mechanism for a deal and timelines for lifting tariffs are sticking points. Chinese officials have also acknowledged that they view the enforcement mechanism as crucial, but say that it must work two ways and cannot put restraints only on China.

In Washington, people familiar with the talks say that the question of whether and when U.S. tariffs on $250 billion worth of Chinese goods will be removed will probably be among the last issues to be resolved.

U.S. President Donald Trump has said that he may keep some tariffs on Chinese goods for a "substantial period".

The United States has also been pressing China to further open up its market to U.S. firms. China has repeatedly pledged to continue reforms and make it easier for foreign companies to operate in the country.

In comments published in Wednesday, China's top banking and insurance regulator said the government will further open up its banking and insurance sectors.

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Racked by swine fever, China creates new certification process for pork producers

Pigs raised by farmers are seen at Linquan county on December 5, 2018 in Fuyang, Anhui Province of China.

VCG | Visual China Group | Getty Images

China has asked pork processors and pig dealers to obtain certificates proving their products are free from African swine fever, state news agency Xinhua reported on Wednesday.

The disease has spread rapidly in the world's biggest producer and consumer of pork, reaching every province on the Chinese mainland since its initial detection there last August.

"Processors and dealers should have all pork products examined for the swine fever virus," Xinhua said, citing a government notice.

It was unclear who would conduct the examinations or issue certificates, but the notice was jointly issued by the State Administration for Market Regulation, the Ministry of Agriculture and Rural Affairs and the Ministry of Industry and Information Technology.

The order takes effect from Wednesday, with violators facing "harsh" punishment, the report said.

More inspections of markets, traders and restaurants have also been ordered, according to the report.

African swine fever kills almost all pigs infected, though it is not harmful to people. There is no vaccine or cure.

China's pork output fell 5.2 percent in the first quarter of 2019 compared with a year earlier, according to official data issued last month.

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FAA bans low flights over Venezuela's airspace, citing political instability

An opposition demonstrator walks near a bus in flames during clashes with soldiers loyal to Venezuelan President Nicolas Maduro after troops joined opposition leader Juan Guaido in his campaign to oust Maduro's government, in the surroundings of La Carlota military base in Caracas on April 30, 2019.

Federico Parra | AFP | Getty Images

The U.S. Federal Aviation Administration (FAA) on Tuesday evening issued an order prohibiting U.S. air operators from flying below 26,000 feet in Venezuela's airspace until further notice, citing "increasing political instability and tensions."

The FAA notice said any air operators currently in Venezuela, which would include private jets, should depart within 48 hours.

Venezuelan opposition leader Juan Guaido on Tuesday made his strongest call yet to the military to help him oust President Nicolas Maduro but there were no concrete signs of defection from the armed forces leadership.

American Airlines Group in March said it was indefinitely suspending its flights to Venezuela, as the country continued to struggle with political turmoil and unrest.

OPSGROUP, which provides safety guidance to air operators, said options for those choosing to avoid Venezuelan airspace would include routes west via Colombia, or east via Guyana.

"The (FAA) order comes on a day of an information battle waged between Maduro and Guaido, and although the coup status is uncertain, one thing is clear: taking your aircraft to Venezuela is not a good idea," OPSGROUP said on its website.

Flight tracking service FlightRadar24 on Tuesday evening showed some flights between South America and Europe were crossing Venezuelan airspace, but at altitudes above 26,000 feet.

Early on Tuesday, several dozen armed troops accompanying Guaido clashed with soldiers supporting Maduro at a rally in Caracas, and large anti-government protests in the streets turned violent.

Venezuelans were expected to again take to the streets on Wednesday for what Guaido pledged would be the "largest march" in the country's history.

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How two Filipino brothers staved off competition from McDonald's to build a global fast food brand

In business, there's nothing like a little healthy competition to keep you motivated.

Only, for brothers Tony Tan Caktiong and Ernesto Tanmantiong, that healthy competition came early on — in the sizable form of fast food icon McDonald's.

It was then 1981 and the brothers were just setting out on the ambitious dream of creating a fast food empire in their native Philippines when McDonald's arrived in town and threatened to consume the market with its vast appetite for international expansion.

Jollibee had already grown substantially from what started in 1975 as an ice cream parlor in Quezon City, just outside of the capital Manila. But, with just a couple dozen fast food outlets scattered across the fractured archipelago, it was a small fry next to McDonald's thousands of branches in the U.S. and international markets.

Tony Tan Caktiong, chairman of Jollibee Foods Corp., speaks during the Hong Kong Asian Financial Forum (AFF) in Hong Kong, China, on Monday, Jan. 19, 2015.

Bloomberg | Getty Images

Indeed, friends told the pair as much, and advised them to retreat from the challenge, Tanmantiong revealed in a recent episode of CNBC's "Managing Asia."

"When we learned that McDonald's was coming into the country, friends were telling us to shy away from the competition — do (like) other businesses and to not try confronting the global giant," Tanmantiong, Jollibee's president and CEO, told CNBC's Christine Tan.

But Tan Caktiong refused to hear it, Tanmantiong explained. Instead, the then-28-year-old founder called the business together to form a plan of attack.

We did a SWOT analysis on our strengths, our weaknesses and what the gaps were.

Ernesto Tanmantiong

CEO and president, Jollibee

"What we did was to have a strategic planning internally," said Tanmantiong.

"We did a SWOT analysis on our strengths, our weaknesses and what the gaps were," he continued, referring to a common analysis technique which aims to assess a business' strengths, weaknesses, opportunities and threats.

While McDonald's benefited from economies of scale and decades' more experience, Tanmantiong said they identified one major area in which the U.S. giant could not compete: Taste. Filipinos tend to favor sweeter and spicier flavors, he said, and it would be difficult for McDonald's to adapt to that without hurting the iconic American taste for which they had become famed.

"After that strategic session, we came out quite confident. So instead of chickening out, we jokingly said, we actually serve Chickenjoy," Tanmantiong said, referring to the company's core fried chicken dish.

It's that unique menu — which includes a sweet "Jolly Spaghetti," hot dogs and spicy burgers — that has fueled the now expanded Jollibee Foods' vast international growth in the years since. The company now has more than 3,500 stores in the Philippines and another 1,000 internationally, including under its additional brands like Smashburger, Burger King Philippines and Panda Express Philippines.

But as the business embarks on further expansion into the U.S., one of its key strategic markets next to China, it will again come head to head with McDonald's — this time on the American rival's home turf. Earlier this year, Jollibee launched its first branch in Manhattan, New York, one of currently just 37 outlets in the U.S.

Ernesto Tanmantiong, CEO of Jollibee Foods Corp., speaks during a Bloomberg Television interview at the Asia-Pacific Economic Cooperation (APEC) CEO Summit.

Bloomberg | Getty Images

Tanmantiong said he, Tan Caktiong (now Jollibee chairman), their two other brothers and the rest of the team, initially planned to embark on that path by by targeting Filipino customers living overseas. But, in fact, he said, they've been surprised to find Jollibee's distinct taste has a home among non-native patrons, too. Indeed, they account for 50 percent of the company's overseas customer base.

That should help Tan Caktiong on his latest mission to turn Jollibee into one of the world's top five restaurant companies in terms of market capitalization. Having become the largest restaurant in Asia in 2014, Jollibee will have to face off against the likes of Starbucks, Yum! Brands and Domino's to secure that accolade.

Tanmantiong said, however, that his brother loves a challenge.

"Tony is a visionary and he loves to dream big," Tanmantiong said. "That's primarily the reason why (Jollibee Foods Corporation) is where it is today. Because of that bold vision, the entire organization has been challenged, but it has been fulfilling trying to achieve the vision."

Don't miss: How these women went from earning 20 cents a day to sending their children to college

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Employees serve customers inside a Jollibee Foods Corp. restaurant in Quezon City, Metro Manila, the Philippines.

Bloomberg | Getty Images

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Disney Studios Chairman Alan Horn hosting fundraiser for Nancy Pelosi and House Democrats

Speaker of the House Nancy Pelosi (D-CA) speaks during the introduction of the Climate Action Now Act on Capitol Hill in Washington, D.C., March 27, 2019.

Joshua Roberts | Reuters

Walt Disney Studios Chairman Alan Horn is hosting a fundraiser at his Los Angeles mansion for House Majority Leader Nancy Pelosi and the Democratic Congressional Campaign Committee, CNBC has learned.

In an email to CNBC, Horn confirmed details of the event that he and his wife, Cindy, are holding for Pelosi.

"We are in fact hosting an event for Nancy and the DCCC at our home on May 30," he said on Tuesday.

There are at least 12 other House Democrats attending the event, including House Intel Committee chairman Rep. Adam Schiff, D-CA, DCCC Chairwoman Rep. Cheri Bustos, D-IL, Rep. Gil Cisneros, D-CA, Rep. Abby Finkenauer, D-IA, Rep. Katie Hill, D-CA, Rep. Nita Lowey, D-NY, Rep.Richard Neal, D-MA, Rep. Harley Rouda, D-CA, and Rep. Lauren Underwood, D-IL, according to a senior Democratic congressional aide with direct knowledge of the matter.

Horn has been a longtime backer of the DCCC, the official campaign arm for Democrats running for seats in the U.S. House of Representatives. He donated just over $95,000 to the committee during the 2018 congressional midterm elections, according to Federal Election Commission records. During former President Barack Obama's second term in office, Horn hosted at least one DCCC fundraising event with the then-commander in chief as the featured guest.

He was also a supporter of Hillary Clinton when she ran for the White House in 2016, helping her raise at least $100,000 and contributing $50,000 directly to her joint fundraising committee, the Hillary Victory Fund, according to the nonpartisan Center for Responsive Politics.

Horn referred questions about how much each ticket will cost and names of other attendees to his political consultant who declined to respond to follow up requests for comment. Tickets for a prior fundraiser with Obama as the marquee guest ranged from $15,000 to $66,800 per couple.

A spokesman for the DCCC said that the event was closed to the press while a representative for Pelosi's office did not return an email seeking comment.

A strong year of fundraising before the next congressional election in 2020 will likely prove crucial for House Democrats if they want to successfully defend their majority.

In 2018, the party flipped at least 40 seats and pulled off enough victories to retake control of the House.

The nonpartisan Cook Political Report, however, shows that in 2020, 31 Democrats are up for re-election are in districts carried by President Donald Trump when he first ran for president three years ago. It marks 17 Democrat-held seats as toss-ups, which includes districts in New York, Iowa, Virginia and South Carolina.

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Judge rules Democrats' suit against Trump over foreign payment can proceed

U.S. President Donald Trump welcomes the Baylor women’s NCAA championship basketball team in the Oval Office at the White House April 29, 2019 in Washington, DC.

Chip Somodevilla | Getty Images News | Getty Images

A U.S. federal judge ruled on Tuesday that Democrats in Congress can move forward with a lawsuit accusing President Donald Trump of violating the law by accepting gifts or payments from foreign governments through his businesses.

U.S. District Judge Emmet Sullivan denied a motion by Trump to dismiss the lawsuit filed by 198 members of Congress.

The lawmakers charge the president violated the Constitution's "emoluments" clause, which prevents federal officeholders from accepting payments from foreign governments without the "consent" of Congress.

The constitutional provision is designed to prevent corruption and foreign influence.

Sullivan said in his 48-page decision that he found Trump's attempt to narrowly define the emoluments clause to be "unpersuasive and inconsistent."

He said he agreed with congressional Democrats who brought the case that the clause should be read more broadly as barring an official from taking any payment of any kind whatsoever from a foreign state without congressional approval.

Justice Department spokeswoman Kelly Laco said: "As we argued, we believe this case should be dismissed, and we will continue to defend the President in court."

Democratic U.S. Representative Jerrold Nadler called the ruling "an important milestone in seeking to hold the President accountable for his ongoing violations" of the emoluments clause.

Trump, a wealthy real estate developer who as president regularly visits his own hotels, resorts and golf clubs, maintains ownership of his businesses but has ceded day-to-day control to his sons. Critics have said that is not a sufficient safeguard.

The lawsuit by congressional Democrats is one of two cases against Trump involving the emoluments clause of the U.S. Constitution.

In the other case, Democratic attorneys general in Maryland and the District of Columbia argued that Trump's failure to disentangle himself from his hotels and other businesses made him vulnerable to inducements by foreign officials seeking to curry favor. The case was later narrowed to focus specifically on Trump's hotel in Washington.

Since his election, the hotel has become a favored lodging and event space for some foreign and state officials visiting the U.S. capital.

A federal judge in that case also rejected Trump's narrow view that emoluments were limited essentially to outright bribes. But an appeals court is reviewing the case and has temporarily frozen evidence-gathering that could force disclosure of Trump's financial records.

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Judge approves agreement between Elon Musk and SEC over the CEO's Twitter use

Elon Musk, chief executive officer of Tesla Inc., waves while departing from federal court in New York, U.S., on Thursday, April 4, 2019.

Bloomberg | Getty Images

A federal judge on Tuesday approved a deal struck between Tesla Inc chief executive Elon Musk and the U.S. Securities and Exchange Commission over Musk's use of Twitter, a court filing showed.

U.S. District Judge Alison Nathan in Manhattan approved the deal worked out on Friday that settled the dispute in which the SEC had sought to find Musk in contempt of a securities fraud settlement last year.

Earlier this month, Nathan had ordered the parties to work out an arrangement between themselves.

The new deal lays out in more detail what types of statements by Musk must be reviewed by Tesla's legal counsel before publication, such as financial statements, previously unreported production or delivery numbers, and other topics.

Regulators had claimed that a February tweet by Musk about Tesla's production numbers violated the earlier settlement, as it had not been vetted by the company's attorneys. Musk countered that the tweet was not material.

The SEC sued Musk last year for making fraudulent statements after he tweeted on Aug. 7 that he had "funding secured" to take Tesla private at $420 per share.

The parties eventually settled, and the deal called for Tesla's lawyers to pre-approve written communications, including tweets with material information about the company.

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Sri Lanka's tourism sector counts the human and financial toll of Easter attacks

Sri Lankan hotelier Roman Scott swung into crisis mode after the Easter Sunday attacks, driving across the island to make sure his employees and guests were safe.

"First you go through absolute shock and then you start quickly moving ... you have to close things down, assess the situation ... see what happened to your staff," he told CNBC on Friday.

Luckily, no harm came to them, though many did lose family in the western coastal city of Negombo where dozens died after suicide bombers targeted worshippers attending mass at St Sebastian's church.

"All of them have lost family ... sadly, we had funerals to deal with," Scott said.

Some 10 years on from Sri Lanka's three-decade long civil war, the country stands "terribly wounded," Dilhan Fernando, CEO of Sri Lankan tea company Dilmah, said in an e-mail. The island "experienced violence at a level of ferocity that we did not see even during the 30 year conflict," he said, adding that "everyone knows someone" who has been affected.

Sri Lankans and business owners like Fernando and Scott are now asking if the Easter Sunday attack was a one-off, or whether it is the start of a cycle of violence that could send an already shaky economy into a downward spiral.

Signage for the Central Bank of Sri Lanka in Colombo, Sri Lanka.

Kuni Takahashi | Bloomberg | Getty Images

"The last 18 months economically have been a big challenge," said Lahiru Pathmalal, CEO of Sri Lanka's largest ecommerce website, Takas.lk. "This will only make it worse."

That may be especially true for the country's tourism sector.

With its ancient Buddhist temples, surf-worthy beaches and lush hill-country tea plantations, Sri Lanka was named Lonely Planet's top destination for 2019. Now, tourism revenue, which accounts for nearly 5% of economic activity, is in question.

Ratings agency Fitch, in its latest Asia-Pacific regional sovereign credit review on April 24 warned that the Easter weekend bombings "will undermine tourism receipts, which had been rising steadily in recent years, and create new downside risks to the growth outlook."

As the hospitality industry tries to come to terms with the human and financial costs, the government is under pressure — from the International Monetary Fund, the country's central bank and more — to act decisively to bring the security situation under control and restore confidence. That could prove challenging.

"One way or the other, we should expect plenty of accusations and counter-accusations in the coming days which is not a good thing for the general well being and governance of the country," said Alastair Newton, a political analyst and former British diplomat.

"Add to this the inevitable 'hit' to inbound tourist numbers in the coming weeks and things are not looking particularly good for an economy which has really only recently been getting back on its feet fully following the civil war," he added.

Now, as a wounded country tries to pick up the pieces, the threat of communal polarization and further attacks lingers. Divided government threatens to make matters worse.

"From an investment perspective, we are closely assessing any negative fallout on tourism receipts," said Neeraj Seth, head of Asian credit at BlackRock. "A significant slowdown would widen the current account deficit and increase rupee vulnerability."

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Mnuchin says he had a 'nice' working dinner in China with Vice Premier Liu

US Treasury Secretary Steven Mnuchin arrives at a hotel in Beijing on April 30, 2019.

GREG BAKER | AFP | Getty Images

U.S. Treasury Secretary Steven Mnuchin said on Wednesday that he had had a "nice" working dinner the night before in Beijing with Chinese Vice Premier Liu He.

"We did. We had a nice working dinner, thank you," Mnuchin told reporters at his Beijing hotel, when asked if he had met with Liu the night before. He did not elaborate.

Mnuchin, along with U.S. Trade Representative Robert Lighthizer, is in China for the latest round of talks aimed at ending their bitter trade war.

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Qantas seeks backing from pilots, regulator for record-long routes

Alan Joyce, chief executive officer of Qantas Airways, speaks during a news conference in Sydney, Australia, on Thursday, Feb. 21, 2019.

Brendon Thorne | Bloomberg | Getty Images

Qantas Airways, which hopes to buy planes this year for record-breaking 21-hour flights between Sydney and London has two hurdles left to overcome: getting pilots and Australia's aviation regulator to agree to unprecedented duty times.

Airlines around the world are planning longer flights to compete with one-stop rivals and collect a fare premium of about 20 percent on non-stop routes, which are especially popular with corporate travelers.

Airbus and Boeing say their aircraft are ready, with only details like seat configuration left to hammer out, Qantas chief executive Alan Joyce said.

But there is a human cost to flying from Sydney to London or New York that must be resolved before tickets are sold, Joyce added.

"We don't have the ability to do that length of duty today so you do need to negotiate that and get the regulator comfortable with it," Joyce told Reuters in a phone interview. "If the business case works ... (we can) put an order in by the end of this year and have aircraft arriving in 2022."

Qantas pilots say the unprecedented length of the new flights means the airline needs do more research, consider more training, use more experienced pilots and change what they say is a flawed fatigue-reporting system.

The maximum pilot duty time on the Sydney-London flights is expected to be around 23 hours, more than the current limit of 20 hours. "Duty" includes time on the ground before and after flights during which the flight crew is working.

Qantas already has 17-hour non-stop journeys between Perth and London with four pilots onboard.

Australia's Civil Aviation Safety Authority (CASA) will evaluate the proposed longer duty time based partly on a study of pilot fatigue on the Perth-London route, agency spokesman Peter Gibson said.

It could approve longer hours, reject the proposal, approve a shorter duty time or require new measures like a more experienced crew or extended rest periods.

"The technological change is obviously there but the human physiological side hasn't changed since the Wright brothers flew," said Mark Sedgwick, the head of the Qantas pilots union, The Australian and International Pilots Association (AIPA). "We really need to understand the effects on human performance on the flight deck of these ultra-long range flights."

Reporting fatigue

The Australian Transport Safety Bureau in January released a study on pilot fatigue that found 60 percent of long-haul pilots had experienced moderate to severe fatigue on their most recent flight.

One issue: take-off times that work best for passengers on long flights are not ideal for easing pilot fatigue.

"From a passenger's point of view, a night flight at the end of the day makes it easier to adjust to the time," former Qantas head of safety Ron Bartsch said. "Obviously being up the front end, (the pilots) are doing some work."

Managing fatigue is a serious issue for airlines globally, and CASA is overseeing a new data-driven fatigue risk-management system at Qantas. The agency says the new system, which also takes into account fatigue reports from pilots, will create a flexible framework for duty times rather than prescriptive rules.

CASA and AIPA are also sponsoring a detailed fatigue study by Monash University that monitors sleep patterns of pilots on the Perth-London route.

Measures to fight fatigue could include putting more flight crew onboard; adding crew beds; requiring more rest before and after flights; providing transport home; and reducing subsequent duty periods, Gibson said.

According to Qantas, pilots who feel too fatigued must complete a report.

The time off is then treated as sick leave, the airline said, but Brad Hodson, a Qantas captain and union official who has flown from Perth to London, said the policy could lead to under-reporting.

"It is easier just to go sick because you don't have to fill in reports," he said.

How pilots are paid when they take time off because of fatigue is an "industrial issue" outside CASA's jurisdiction, Gibson said.

Qantas and AIPA are negotiating a new union contract for long-haul pilots. Joyce said he hoped for an agreement this year.

"AIPA is supportive of the commercial benefits that may flow to Qantas in being able to operate these long premium routes with minimal competition," Sedgwick said. "We want to make sure the safety and fatigue management issues are adequately addressed in the process of enabling these flights."

Experience levels

Crew experience on long-haul flights also will be part of contract negotiations, Sedgwick said.

The world's longest flight is Singapore Airlines' almost 19-hour journey from Singapore to New York.

Singapore's aviation regulator said in a statement that it requires the airline to have two captains and two first officers on shifts of more than 18 hours, including time before and after takeoff, to "optimise their alertness throughout the flight."

Qantas, which has a maximum duty period of around 20 hours on its Perth-London flights, also has four pilots. Crew can rest in bunks.

But the Australian airline uses one captain, one first officer and two second officers. Second officers are paid less, can fly only at cruising altitudes and cannot take off or land.

Hodson said Qantas did not necessarily need to put two captains and two first officers on each flight. More training for second officers or adding a first officer in place of one second officer were options, he added.

"I think having another qualified pilot who could sit in the seat for take-off and landing would ameliorate a lot of the issues there," Hodson said. "But Qantas won't like that because it costs money."

Joyce said the final crew mix and training had not been decided.

"We will need to work through the safety case and our requirements and then talk to pilots and regulators," he said.

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US judge orders Chinese banks to hand over North Korea records

North Korean and US flags stand side by side at the location where North Korea's leader Kim Jong Un will meet with US President Donald Trump for a US-North Korea summit, at the Capella Hotel on Sentosa island in Singapore on June 12, 2018.

SAUL LOEB | AFP | Getty Images

A U.S. district judge has ordered three Chinese banks to comply with U.S. investigators' demands that they hand over records connected to the alleged movement of tens of millions of dollars in violation of international sanctions on North Korea.

In a heavily redacted court opinion released by the U.S. Justice Department on Tuesday and dated March 18, Beryl Howell, Washington D.C.'s chief federal district judge, said the subpoenas were for records of dealings between a now-defunct Hong Kong-based front company and a North Korean state-run entity.

The publicly released court document did not name the banks, the Hong Kong company, or the North Korean entity. It said the front company was established by a North Korean national and a Chinese individual, who were also not named.

It said the Chinese government had ownership stakes in all three of the banks, the first two of which have branches in the United States.

The subpoenas were issued in December 2017 as part of a U.S. investigation into violations of sanctions targeting North Korea's nuclear weapons program, including money laundering and contravention of the U.S. Bank Secrecy Act.

According to the court document, the subpoenas demanded a wide range of bank records dating back to January 2012.

The document highlighted transactions totaling $105.34 million, including $45.78 million that went through a U.S. correspondent account of the first Chinese bank; $1.63 million that went through a correspondent bank account of the second bank, and $57.93 million that went through a U.S. correspondent account of the third.

The judge's ruling said U.S. Justice Department officials visited China in April and August last year to discuss the failure of the banks to respond to the requests for evidence.

The documents were not produced and in November, U.S. prosecutors filed a court motion seeking to compel the banks to comply.

Judge Howell ordered the first two banks to produce the records promptly or testify before a grand jury. She ordered the third bank to produce the subpoenaed records by March 28. It was not clear how or if the banks responded. China is North Korea's neighbor and main trading partner but has committed to enforcing international sanctions aimed at pressing Pyongyang to give up its nuclear weapons.

Beijing has also said it opposes unilateral sanctions outside the U.N. framework, and has accused Washington of using "long-arm" jurisdiction in targeting Chinese entities.

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Mueller reportedly criticized Attorney General Barr's summary of special counsel report on Trump

Robert Mueller

Larry Downing | Reuters

Justice Department Special Counsel Robert Mueller reportedly raised criticisms about Attorney General William Barr's summary of the probe into Russian interference in the 2016 election because he felt it left the impression that U.S. President Donald Trump was cleared of any possible obstruction of justice, according to multiple reports.

Mueller's critical letter was obtained by the New York Times and Washington Post, which first reported the existence of it late Tuesday. That news was confirmed by NBC News.

Mueller wrote a letter in late March to Barr complaining about the four-page summary, which was sent to Congress on March 24 and later released to the public. Mueller felt that the summary from the attorney general "did not fully capture the context, nature and substance of this office's work and conclusions."

Barr said in the summary released last month that the probe did not conclude that Trump or anyone in his campaign "conspired or coordinated" with Russia in its influence campaign.

According to Mueller's letter to Barr, "There is now public confusion about critical aspects of the results of our investigation. This threatens to undermine a central purpose for which the Department [of Justice] appointed the Special Counsel: to assure full public confidence in the outcome of the investigations."

For more on the story, see the NBC News report on Mueller's letter to Barr.

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Two dead, four injured in shooting at University of North Carolina at Charlotte

A medic walks between police cars after a shooting on the campus of University of North Carolina at Charlotte in University City, Charlotte, on April 30, 2019.

Logan Cyrus | AFP | Getty Images

Two people were killed and four others wounded — two with life-threatening injuries — in a shooting on Tuesday at the University of North Carolina at Charlotte, according to the Mecklenburg Emergency Management Services Agency.

Local media reported that a suspect believed to be a student at the school was taken into custody.

Television station WBTV in Charlotte reported that gunfire erupted about 5:45 p.m. (2145 GMT) near the university's Kennedy Hall administrative building, and that one person had been arrested.

The Mecklenburg EMS, an independent agency that handles emergency services for the county, confirmed on Twitter that two people were dead on the scene and that four others were taken to a nearby hospital, two of them with life-threatening injuries. A spokesman, Lester Oliva, also confirmed the casualty toll.

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Amazon closes Souq, the company it bought for $580 million, to launch a new Middle East marketplace

Amazon launched a new Middle East marketplace on Tuesday, two years after buying the Dubai-based e-commerce company Souq.com for $580 million.

With the launch, Amazon said Souq.com will effectively shut down. The Souq.com URL now automatically takes you to Amazon.ae.

"We are proud to announce that we are now Amazon.ae," Amazon wrote in a letter posted on the new Middle East marketplace.

The launch of the new Middle East marketplace, which was first reported by CNBC in January, comes at a time of slowing international sales for Amazon. In its most recent quarter, Amazon's international sales only grew 9% from a year ago to $16.2 billion.

Amazon's representative wasn't immediately available for comment.

The change gives Amazon's Middle East service a more unified look and brand in the region. Until now, Amazon's only presence in the region was through Souq, which it acquired in 2017. It also comes with the same seller back-end system used in the U.S., and access to Fulfillment by Amazon (FBA), the company's storage and shipping service, according to multiple sellers.

Amazon.ae

Amazon.ae

In the letter announcing the launch, Souq's cofounder Ronaldo Mouchawar wrote Amazon's new Middle East service will sell over 30 million products, "including those available on Souq and five million products from Amazon US." It will also offer the option of shopping in Arabic for the first time, he said.

This isn't the first time for Amazon to shut down a company it acquired. In 2017, it closed Quidsi, the parent company of diapers.com and soap.com, which it acquired for $545 million seven years earlier. Though it cited profitability challenges for the closure, Amazon had little need for Quidsi because it was selling the same products on Amazon.com.

WATCH: Rakuten vs Amazon: The battle for Japan's e-commerce market

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Australian stocks poised for tepid open as most Asian markets stay shut for holidays

Apple is finally moving beyond the iPhone as the smartphone industry stalls out

Apple's iPhone is an incredible moneymaking machine. In the first three months of 2019, Apple sold $31 billion worth of iPhones.

At the same time, the iPhone is becoming less important to Apple's total sales as the smartphone industry stalls globally.

iPhone revenue accounted for 53.5% of Apple's revenue for the company's fiscal second quarter, which it reported on Tuesday. Last year, during the same quarter, iPhones sales were 61.4% of sales, and in the most recent quarter that ended in December, it accounted for 61.7% of Apple's total sales.

The smaller share of iPhone revenue indicates that Apple is getting more skilled at selling other hardware and software products to its installed base of 900 million iPhone users.

Part of the iPhone's diminished importance on Apple's balance sheet can be attributed to sales shrinkage. iPhone revenue was also down 17.33% year-over-year.

But part of it can be attributed to growth in other categories.

Apple CEO Tim Cook also highlighted two big and growing businesses during a call with analysts: Apple's Services revenue, which includes subscriptions like Apple Music and iCloud, and Apple's Wearables business, which includes hardware products such as AirPods and the Apple Watch.

"It was our best quarter ever for services, with revenue reaching $11.5 billion," Cook said. Services revenue was up 16% from $9.19 billion in sales the same period last year. Apple has been emphasizing its services business as iPhone sales stall, and held an event in March to launch four new services, including two new video services and a credit card.

Wedbush analyst Dan Ives estimated that Apple's streaming services could sign up as many as 100 million customers over the next three years.

Apple also had success with what it calls its "wearables" business, which includes AirPods, Apple Watch and Beats headphones.

Although Apple doesn't break out that number by itself — it has a similar category that includes other accessories such as cords and HomePod — Cook said on Tuesday that wearables grew at a rate close to 50% during the quarter. AirPods and Apple Watch are the two most important completely new hardware lines for Apple, and they are selling well.

Apple can increasingly sell additional gadgets and software to its installed base of 900 million active iPhones. As Apple executives have said, that is now a critical number to understand the company — think of it as the closest stat to Apple's userbase.

Apple  did not provide new installed base figure from its last update of 1.4 billion devices, but Cook did say that it hit an all-time record last quarter across all categories in an interview with CNBC's Josh Lipton.

The message is clear: Apple still makes a majority of its money from iPhones, and that won't change any time soon, but it has a lot of different ways to get Apple customers to open up their wallets, and those businesses are growing as the iPhone business shrinks. That dynamic puts Apple in a great position versus other smartphone makers who are facing the same industry-wide slowdown.

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Massachusetts agency will allow Wynn Resorts to retain gaming license, fines it $35 million

The Massachusetts Gaming Commission will allow Wynn Resorts to retain its gaming license but will fine the company $35 million.

In a written statement, MGC Chair Cathy Judd-Stein said: "Ensuring public confidence in the integrity of the gaming industry and the strict oversight of the gaming establishments through rigorous regulation is our principal objective." But, she continues, "with that comes an equally significant duty of fairness."

The decision clears the path for the global casino company to open its $2.6 billion property Encore Boston Harbor in Everett, Massachusetts, in June.

Regulators had tackled serious questions about the company's suitability after investigators determined the company repeatedly and over years had turned a blind eye to employees' accusations of rape, sexual harassment and other misconduct against founder and then-CEO Steve Wynn. He has said he had romantic relationships with workers but has consistently denied any coercion.

But the company argued that it separated from its CEO shortly after the allegations were made public in The Wall Street Journal in January 2018. Wynn resigned on Feb. 6 that year and sold his entire stake by mid-March.

Wynn Resorts defended itself by saying the company is no longer about a single man. Executives and board members argued strenuously the company had reinvented itself, with new leadership, a new board with three new women as directors, new policies and a new commitment to transparency with regulators.

The MGC also reviewed the suitability of CEO Matt Maddox and co-founder Elaine Wynn, Steve's ex-wife, the only two individual qualifiers remaining from the original license application, and decided they are suitable.

Gaming regulators have voted to fine Maddox $500,000 for what they called his failures in enforcing company policy.

Also the commission is requiring the board to hire an executive coach for Maddox to focus on leadership development and they will require the role of chairman and CEO to remain separated for the term of the license, 15 years.

Maddox was the longtime protege of Steve Wynn — and his appointed successor. In a three-day hearing in March, after investigators presented their report, regulators grilled Maddox about why he didn't know about multiple settlements, complaints or mishandling of allegations.

In its post-hearing brief, Wynn Resorts responded: "…the settlements were known to very few within the Company who worked in silos, meaning that some individuals became aware of certain settlements, but not others."

Wynn Resorts fiercely defended its CEO in the brief, arguing the commission applied the standard of suitability as "one that judges his leadership, which is not a statutory criterion in the Gaming Act."

Elaine Wynn, as the company's largest shareholder, was also found to be suitably qualified.

Regulators had pressed her in the March hearing about why, as a board member, she hadn't revealed to the board or to gaming regulators the existence of a 2005 multimillion-dollar settlement between Steve Wynn and a former employee. She testified in a hearing in February that she had fulfilled her responsibility by informing then-General Counsel Kim Sinatra.

Sinatra is among a number of former executives named and blamed by gaming regulators in both Nevada and Massachusetts for systemic failures to enforce company policy. The company says those employees are no longer with the company.

The MCG decision spares Wynn resorts from a much more damaging fate of losing its gaming license and the commission acknowledged all the internal changes and said "Wynn is likely to be a successful operator in Everett."

Jeffries Gaming Analyst David Katz says, "In terms of what expectations were for potential outcomes, this is at the positive end of the range. On the other end of the range where Wynn couldn't keep the license, the building or its executive team would have been more disruptive to the company and the stock."

On April 7, Jeffries upgraded Wynn Resorts to a buy rating with a price target of $170. "Our thesis is: this is the last big project they have. They go through a capital pivot where the spending stops and the cashflow goes up and the leverage goes down and it accretes to the equity value, " says Katz.

Harry Curtis, gaming analyst at Nomura/Instinet, says "It has long-term, positive implications for Wynn's ability not only to compete, but to succeed, in larger scale, global destination markets."

In February, the Nevada Gaming Commission fined Wynn Resorts a record $20 million for failing to protect employees and apply its own policies to Steve Wynn. But it followed up that decision with a letter to Wynn Resorts confirming that in Nevada, Maddox was determined to have met suitability requirements.

Wynn Resorts had held off announcing a date for its first-quarter earnings release and call while it waited on the decision in Massachusetts.

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Cramer: Investors that bought Apple ahead the quarter got the call right

CNBC's Jim Cramer said investors who bought Apple ahead of its first-quarter report made the right gamble.

The "Mad Money" host typically does not recommend buying a stock ahead of earnings, in case the company delivers a bad report. But the tech giant did not disappoint on Tuesday.

"Not only did Apple deliver a nice top- and bottom-line beat, but China, the major source of weakness last quarter, is turning around," Cramer said. "When I spoke to [CEO] Tim [Cook] about it, I was surprised how bullish he was."

While iPhone sales were down 17%, Cramer pointed out that Apple management said it picked up at the end of the quarter. Growth in the wearables segment and the nascent services business could make for a great second quarter, he added. Apple held its quarterly conference call after the market closed Tuesday.

Shares of Apple fell 1.93% during the session. The stock climbed 5% in after-hours trading.

"Apple bought back billions of dollars worth of stock with an average price of $167," he said. "Now it makes sense, too, as did the possibility that some enterprising analysts might soon realize, that the lifetime value of the service stream of an iPhone user … may turn out to be the greatest annuity of all time."

The Dow Jones Industrial Average and S&P 500 both added about 0.1% during the session.

Cramer said there were bad trades made Tuesday. On zero news, many individual stocks, particularly in the packaged goods sector, rallied but lost those gains soon after, he said.

"Look, when the stock market does something stupid, that's your opportunity to take the other side of the trade and do something smart," Cramer said. "I don't like the market to denigrate itself. I do like it [today] 'cause it gave you a chance to buy Apple."

Disclosure: Cramer's charitable trust owns shares of Apple.

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Cramer dissects Alphabet's earnings slump: 'Sloppy execution, bad salesmanship'

CNBC's Jim Cramer said Alphabet's stock would not have cratered nearly $100 per share during the session if Chief Financial Officer Ruth Porat had done one thing on Monday's quarterly earnings call: Be open and honest.

"When you miss numbers, you have to acknowledge it. You need to say, 'Hey, we messed up, this is what went wrong, this is how we'll fix it,'" the "Mad Money" host said Tuesday. "Alphabet disappointed, but Ruth Porat didn't say that."

Shares of Google's parent fell 7.5% during the session. The company reported an earnings beat, but missed revenue expectations by roughly $1 billion.

It's evident that Google is losing market share in digital advertising to other internet giants, namely Facebook and Amazon, Cramer said. Alphabet needs to get real with itself, he said.

"But instead, it seems like this company has become constitutionally incapable of admitting that they let anybody down," he said.

Companies are pumping more money into web advertising, but the money is flowing away from the top online engine, Cramer said.

Google's ad revenue grew 15% in the first quarter, slower than the 24% increase in the segment the year prior. Amazon and Facebook met and exceeded, respectively, revenue expectations in their reporting periods.

"And Alphabet's problems run even deeper than that. I'm starting to question if they know how to deal with the enterprise, for example," Cramer said. "And I'm starting to think that they've let down a lot of their partners, who are very angry about the endless formulation changes designed to keep customers on their toes."

Alphabet has also dodged the reality that it trails in the cloud space behind Amazon's Web Services and Microsoft's Azure, the host said. The company is now spending billions of dollars to partner with third parties to stay in competition, he pointed out, adding more weight to its operating expenses.

"It's not a bad plan, but how did we get to the point where Amazon Web Services and Microsoft Azure ate Google Cloud's lunch?" Cramer asked.

Cramer expected to hear on Monday how Alphabet would monetize its premium YouTube subscribers. Instead, the company blamed the video platform for its slowdown in advertising revenue.

Analysts who cover Alphabet have lost some confidence in the stock.

Since Alphabet provided no answers, Cramer gave his own conclusion: "Sloppy execution, bad salesmanship, and, most important, Alphabet's getting its butt kicked by hungrier, more-savvy competitors."

Alphabet has a market cap of about $833 billion. The stock is up about 14% in 2019 and about 17% in the past year.

Disclosure: Cramer's charitable trust owns shares of Alphabet, Facebook, and Amazon.

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Apple is an 'earnings powerhouse,' says tech investor Gene Munster

Investors aren't appreciating just how well Apple will do in the coming years, noted tech investor Gene Munster told CNBC on Tuesday.

The tech giant reported earnings and guidance after the bell on Tuesday that beat estimates, sending the stock higher in extended trading.

"This company is an earnings powerhouse," said Munster, founder of the venture capital firm Loup Ventures.

Apple employees cheer as the doors are opened for customers at the Fifth Avenue Apple Store, in New York City.

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Apple announced earnings per share for the first quarter were $2.46, versus $2.36 forecast by Refinitiv consensus estimates. Its projected third-quarter revenue was $52.5 billion to $54.5 billion versus the $51.94 billion by Refinitiv consensus estimates.

In an interview with CNBC's Josh Lipton, CEO Tim Cook said Apple's performance in China had improved over the previous quarter. That is a part of Munster's bullish thesis, as are the stock buybacks the company announced on Tuesday.

Apple said that it would spend $75 billion on share repurchases and it also approved a 75 cent dividend per share, a 5% increase.

"This is a huge deal," Munster said on "Fast Money. " He calculates the buybacks could boost the stock by 25% over the next five years.

He's also sticking by his call that Apple is the best way to play 5G.

"Investors are largely underappreciating what this stock could do," said Munster.

"This story could be a $350 stock over the next couple years, and I think they are going to surprise people on this earnings power."

— CNBC's Kif Leswing contributed to this report.

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Jussie Smollett not expected to return to Fox's 'Empire' for sixth season

Actor Jussie Smollett leaves Leighton Criminal Courthouse after his court appearance on March 14, 2019 in Chicago, Illinois. Smollett stands accused of arranging a homophobic, racist attack against himself in an attempt to raise his profile because he was dissatisfied with his salary on the Fox television drama 'Empire.'

Nuccio DiNuzzo | Getty Images

"Empire" may have been renewed for a sixth season on Fox, but at least one actor won't be returning to the show.

Jussie Smollett, who was arrested and accused of staging a phony hate crime against himself in March, is reportedly not going to be part of the musical drama next season.

"By mutual agreement, the studio has negotiated an extension to Jussie Smollett's option for season six, but at this time there are no plans for the character of Jamal to return to 'Empire,'" Fox Entertainment and 20th Century Fox Television said in a statement to Variety.

Fox did not immediately respond to CNBC's request for comment.

The news comes just days after fellow cast mates Taraji P. Henson and Terrence Howard, among others, penned a letter to the network, asking for Smollett to be brought back.

"Together, as a united front, we stand with Jussie Smollett and ask that our co-star, brother and friend be brought back for our sixth season of 'Empire,' " according to a letter obtained by Deadline.

"We understand the past months have been difficult to process — sometimes the headlines brought more confusion than clarity, yet we now have a conclusion to this ordeal," the letter said.

In late March, criminal charges against Smollett were dropped and the case was dismissed in exchange for the actor agreeing to forfeit his $10,000 release bond. The actor had previously pleaded not guilty on March 14.

Smollett, who is black and gay, told Chicago police in January that he was attacked by two masked men as he was walking home around 2 a.m. The actor said the men beat him, shouted racist and homophobic comments, poured a chemical substance on him, looped a rope around his neck and then fled.

Two brothers, Ola and Abel Osundairo, were arrested in February for allegedly being connected to the attack, but later were released without charges. The Osundairos told police that Smollett wrote them a check for $3,500 to carry out the purported attack.

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Stocks making the biggest moves after hours: Apple, AMD, Mondelez & more

The Apple logo is seen on the window at an Apple Store on January 7, 2019 in Beijing, China.

Kevin Frayer | Getty Images

Check out the companies making headlines after the bell:

Shares of Apple soared more than 5% in extended trading Tuesday following the release of the tech giant's better-than-expected earnings for the fiscal second-quarter. Tim Cook's company reported earnings per share of $2.46 on revenue of $58.02 billion. Wall Street estimated earnings per share of $2.36 on revenue of $57.37 billion, according to Refinitiv consensus estimates.

Apple's iPhone revenue came in at $31.05 billion, slightly lower than the $31.10 billion expected. Services revenue beat estimates of $11.37 billion at $11.45 billion.

For the third quarter Apple expects to see revenue between $52.5 billion and $54.5 billion, guiding higher than the $51.94 billion in revenue that analysts had projected.

AMD shares surged as much as 7% after hours Tuesday after reporting strong first-quarter earnings and guidance in line with estimates. The semiconductor company earned $1.27 billion in revenue, topping estimates of $1.26 billion. Earnings per share were 6 cents, slightly higher than the forecast of 5 cents per share, according to Refinitiv. Gross margin was in line with estimates at 41%.

AMD expects to earn about $1.52 billion in revenue during the company's second quarter. Analysts had projected $1.53 billion in revenue for that period.

Shares of Amgen fell as much as 1% after the bell Tuesday despite better-than-expected first-quarter earnings. The biotech copany posted earnings per share of $3.56, beating Refinitiv estimates of $3.48. Revenue came in at $5.56 billion, higher than the $5.54 billion expected by analysts.

Mondelez shares seesawed after market close Tuesday after the food company reported mixed first-quarter earnings. The Oreo cookie maker earned $6.54 billion in revenue, compared to the $6.55 billion forecast by analysts surveyed by Refinitiv. Earnings per share were 65 cents, topping estimates by 4 cents per share. 

The snack giant's organic revenue increased 3.7%, beating estimates of a 2.3% increase.

Shares of insurance company Chubb ticked 1% higher in extended trading Tuesday following the release of its disappointing first-quarter earnings. Missing on the top and bottom lines, Chubb reported earnings per share of $2.54 on revenue of $6.73 billion. Wall Street expected earnings per share of $2.56 on revenue of $6.86 billion, according to Refinitiv.

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Former CEO Eric Schmidt and former Google Cloud leader Diane Greene will leave Alphabet board

Eric Schmidt , former chairman and CEO at Google.

John Lamparski | Getty Images

Alphabet announced Tuesday that Eric Schmidt will not seek re-election to the board seat he has held since 2004.

Schmidt first joined Google as CEO in 2001, back when the company only had several hundred employees, and became its executive chairman 10 years later, handing the CEO role over to co-founder Larry Page. He kept that chairmanship when Google restructured to become Alphabet in 2015, then announced he was stepping down from that role but staying on the board in December 2017.

"Eric has made an extraordinary contribution to Google and Alphabet as CEO, Chairman, and Board member. We are extremely grateful for his guidance and leadership over many years," said John Hennessy, chairman of Alphabet's board, in a statement.

Former Google Cloud chief Diane Greene, who has served on the board since 2012, will also not seek re-election. Former Oracle exec Thomas Kurian replaced Greene as head of its cloud business earlier this year.

Both of their terms will end in June.

The company has also added a new board member, Robin L. Washington, who joined on Apr. 25 and will be part of the Leadership and Compensation Committee. Washington is currently the CFO of biopharmaceutical company Gilead Sciences. Alphabet has been making an increased push into health tech, hiring David Feinberg to lead a new Google Health division last November.

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Powell will try not to draw ire of Trump or rock markets after Fed meeting Wednesday

Fed Chairman Jerome Powell has a tough job ahead of him, as he will have to avoid ruffling both markets and the White House during his briefing Wednesday.

Fed watchers say the chairman will have to walk a fine line, so as not tilt too hawkish, which could unnerve markets and draw the ire of President Donald Trump. Trump launched a new Twitter attack on the Fed as it met on Tuesday, calling for a 1 percentage point rate hike and a return to quantitative easing.

The Fed chair will also want to avoid sounding too dovish, due to the strength of the economy and the fact financial conditions have improved considerably in the last several months. The Fed is not expected to announce any change in interest rate policy, when it issues its statement at 2 p.m. ET, though it may mention that the economy has improved and inflation has weakened.

"If [Powell] does his job, it's going to be a nonevent," said Joseph LaVorgna, Natixis chief economist for the Americas. 

"The reason they won't be too dovish is because the equity market is at a record high. However, the strength in the dollar combined with weak inflation is not going to make them hawkish either," he said.

Fed policy is currently somewhere in the middle, since the Fed has paused its rate hiking and is watching the economic data before it makes any further moves. If it were hawkish, the Fed would be leaning toward raising interest rates, and if it were dovish, it would be leaning toward easing policy and cutting interest rates.

"The Fed needs to stay firmly on the sidelines without spooking financial markets. They can't come to a consensus soon enough on what they are going to do if inflation doesn't pick up in the months to come. They are walking a tight rope between wanting a warmer economy and being justifiable concerned about how low rates are stoking bubbles," notes Grant Thornton chief economist Diane Swonk.

She expects that Powell's comments will be well prepared and to the point. "Shorter is better. [He] needs to stay out of the target range of the administration. He will not answer questions [about the] Fed nominee," Swonk said. Currently, Stephen Moore is a Trump nominee for the Fed, after Herman Cain withdrew. 

Trump ramped up his criticism of the Fed Wednesday when he fired off a tweet that said how great China's stimulus program has been, compared to the U.S. He also said the Fed should cut rates by a percentage point and use quantitative easing, a financial crisis policy tool.

 

"To call for a 1% cut and resumption of QE, those moves by the Fed would be consistent with a massive financial crisis rather than the current economic state," said Jon Hill, U.S. rate strategist at BMO. "It just seems like political posturing ahead of the decision where it's a foregone conclusion that the Fed's not cutting or raising rates tomorrow." 

Hill said the Fed officials will be careful not to sound too dovish because of both the record-high stock market and the desire to stress their independence and not seem like they can be influenced  by Trump's demand for easier policy. 

Yet, behind closed doors, the Fed is likely to be discussing a very dovish move, or the idea of using interest rate cuts as a type of insurance against an economic downturn. But it is not likely to mention the idea in its statement and Powell will not endorse it if questioned about it.

"There has been chatter from Fed members [Chicago Fed President] Charlie Evans and [Vice Chairman] Rich Clarida and some writers that the Fed should consider 'insurance' rate cuts ala 1995 and 1998 as lower inflation gives them cover," noted Peter Boockvar, chief investment office at Bleakley Advisory Group. 

Fed watchers say the Fed is not going to signal any change in policy yet, but may want to have the option of moving interest rates either way.

"I think they want to sound even keeled. The problem they run into is if they keep harping on low inflation it's going to sound really dovish. This is where it comes back to bite them if that's not really what they mean. If they don't mean they're going to cut rates because of it, why harp on it. He's going to have to balance what he says," said Boockvar.

A big topic of interest Wednesday will be how the Fed addresses low inflation, with PCE inflation reported at about 1.5% in March.  PCE is the inflation measure watched by the Fed, though CPI inflation is higher. 

The Fed plans to review how it considers inflation, currently targeted at 2%, so any comments on inflation could be market moving.

The Fed may also make a technical rate cut to the interest rate on excess reserves, reducing it by about 5 basis points to bring down the fed funds rate.

Citigroup currency strategists said the Fed could make the 'technical adjustment', given that the effective fed funds rate has been moving towards the upper end of the Fed's target range.

"The upward drift may well be temporary and related to tax payments and the Fed could easily wait to cut later (including outside of FOMC meetings). We have little visibility on the likelihood of a cut to IOER, but in recent history, the Powell Fed has decided to make a change when there was no strong reason to wait, so our weak base case is that the IOER cut takes place at this meeting. Even though this is meant to be a technical adjustment, the Fed will be aware that such a cut in the present environment would have some symbolic significance," the strategists wrote.

In addition to the IOER, the Fed may also release some more information on its balance sheet and the type of securities it intends to hold. 

Boockvar said Trump should be careful what he wishes for when it comes to Fed policy.

"What Trump is tweeting about.. if excessively low rates, even below zero rates, and a lot of QE was this magical elixir, then the Japanese and European economies would be booming right now instead of barely growing," said Boockvar.

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Twitter could surge 20% to head back to multiyear highs, technician bets

Twitter ended April as one of the best performers in the S&P 500.

Todd Gordon, founder of TradingAnalysis.com, says the rally is just getting started.

"Twitter is a very good-looking chart post earnings. We saw some pretty impressive data following those earnings. Revenues were up 18% year over year and active users saw a pretty good increase, particularly in the U.S.," Gordon said Tuesday on CNBC's "Trading Nation. "

Given the strong fundamental case, Gordon sees Twitter clawing back from the losses suffered through the last half of 2018.

"As we take a look at the charts here, you can see that there's a significant gap right here from $44 down into below $40, so on the back of this earnings report," he said. "They're trying to close that gap, which is a technical phenomenon that does often happen, so the gap closure will take place right around the $42.50 mark."

Twitter gapped down below $40 in a sell-off in late July. It has not closed above that level in nine months.

"As I see this gap close happen, I think provided the overall market can maintain its current trend, which is up as we're pressing or at new highs in the indexes, we should be able to 1) close that gap and 2) retest these old highs right around the $48 mark," said Gordon.

A move back to its 52-week high at $47.79 represents 20% upside from Tuesday's close. It has fallen 16% since hitting a multiyear high last June.

Gordon is buying the June 21 expiration 42/47 call spread for around $1.30. This is a bullish play that Twitter heads back above $47 by expiration.

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Tensions between Venezuela and the US keep rising. Here's how they got to this point

A protester waves a Venezuelan flag during ongoing protests against the government of Venezuelan President Nicolas Maduro in Caracas, on May 27, 2017.

Anadolu Agency | Anadolu Agency | Getty Images

WASHINGTON — Amid a collapsing economy sparked by government corruption, social unrest and a global commodity bust, the oil-rich nation of Venezuela faces even more uncertainty as the Trump administration reaffirmed its decision to back opposition leader Juan Guaido over President Nicolas Maduro.

Guaido, who declared himself interim president in January, said Tuesday he was "beginning the final phase of Operation Freedom" and promised to bring an end to Maduro's government. In the wake of his address, opposition protesters clashed in Caracas with Venezuelan soldiers.

President Donald Trump, who was briefed Tuesday on the situation in Venezuela, wrote on Twitter that he stands with the "people of Venezuela and their freedom."

Echoing Trump's sentiments, acting Secretary of Defense Patrick Shanahan also wrote on Twitter: "The U.S. Government stands in support of interim Venezuelan President Juan Guaido and the people of Venezuela in their quest for freedom and democracy as they take back their country with #OperacionLibertad"

National security advisor John Bolton added to the pressure.

"It's still very important for key figures in the regime, who have been talking to the opposition over these last three months, to make good on their commitments to achieve a peaceful transfer of power from [Maduro] to interim President Juan Guaido," Bolton told reporters at the White House on Tuesday.

White House National Security Advisor John Bolton talks to reporters outside of the White House West Wing April 30, 2019 in Washington, DC.

Chip Somodevilla | Getty Images

These fast-moving developments have brought U.S.-Venezuelan relations to a boiling point after a nearly two-decade saga.

Tensions between Venezuela and the U.S. can be traced back to when Hugo Chavez, Maduro's predecessor, first became president of Venezuela in 1999. During his campaign for president, Chavez villainized the U.S. and other countries he felt were taking advantage of Venezuela.

"It resonated with the voters at the time because Venezuela had a growth collapse in the 1980s, right after oil prices started to fall around the world. It never quite recovered from that," said Monica de Bolle, senior fellow at the Peterson Institute for International Economics. "By the time Chavez came to power, people were just sick of it. They just wanted some big change to happen."

Hugo Chavez wins election.

Juan Barreto | AFP | Getty Images

Venezuela's economy is tightly tied to oil, its biggest export. The South American nation has the biggest oil reserves in the world. In 2017, Venezuela's oil reserves totaled 302.81 billion barrels, according to data from OPEC.

While crude prices trended lower in the 1980s and 1990s, they recovered sharply right before the turn of the century, giving the Chavez government a massive windfall to put in motion several reforms like free health care. The spike in crude also gave Chavez the capital he needed to try and undercut U.S. influence in Latin America.

In 2004, Venezuela and Cuba created an economic pact called the Bolivarian Alliance for the Peoples of Our America. In 2005, Chavez founded Petrocaribe, a group of countries that lets members purchase oil from Venezuela at a lower price.

Chavez also accused the U.S. of aiding in an attempted coup against his government back in 2002. While the Bush administration tried to distance itself from the coup attempt, documents found in 2004 showed the CIA knew of an attempted coup back then.

The U.S. has also condemned Venezuela for imprisoning political opponents as well as the Chavez regime's consolidation of power. Chavez seized control of the country's supreme court in 2004. He also increased his control over the local media, passing laws that penalized outlets for running content that "offends" public officials.

A difficult bond over oil

But relations between the U.S. and Venezuela remained close as the U.S. is still a big consumer of Venezuelan oil. U.S. imports of Venezuelan crude oil and petroleum products averaged nearly 600,000 barrels per day in the first 10 months of last year, according to the U.S. Energy Information Administration.

Once Chavez died in 2013 and Maduro took over, tensions began to increase once again. Maduro, who is not the charismatic leader Chavez was, consolidated his power in 2017 by stripping the country's opposition-led legislature of power. By then, a massive humanitarian and economic crisis had already begun.

Venezuela's economy was decimated after oil prices began collapsing in late 2014. The fall in oil prices made it hard for Venezuela to keep providing subsidies for its many national programs. It has also led to a massive shortage of food and other basic goods like medicine.

This crisis has led the Trump administration to slap sanctions on dozens of Venezuelans associated with the Maduro regime, including his wife, Cilia Flores.

"The situation has deteriorated to the point where there are all kinds of crises in Venezuela," said Peterson's de Bolle. "You have a massive economic crisis, you have a massive institutional crisis, you have a massive migration crisis, you have a massive humanitarian crisis. It's all bad."

Russia ups the ante in Venezuela

Russia's President Vladimir Putin and his Venezuelan counterpart Nicolas Maduro shake hands during a ceremony at the Kremlin in Moscow, on July 2, 2013.

Maxim Shemetov | AFP | Getty Images

Through all of this, Venezuela has found a natural ally in Russia.

Moscow is not only a major political friend of Caracas but also a financier of the South American nation's oil fields. Russia's largest oil company, Rosneft, operates in Venezuela and has issued loans to the state-run oil company PDVSA.

In another show of support, Moscow has given Caracas a line of credit to purchase Russian arms. From Kalashnikov rifles to Sukhoi planes, the Kremlin has brokered several weapons deals with Venezuela and recently deployed two Russian bombers to the country.

Last month, two Russian Tu-160 strategic bombers, capable of carrying nuclear weapons, landed in Caracas in a move designed to show Moscow's support of Venezuela's socialist regime. Despite the nation's economic crisis, Maduro welcomed the deployment of the Russian aircraft.

A Tupolev Tu-160M heavy strategic bomber performs a demonstration flight at an airfield of the Gorbunov Kazan Aviation Factory.

Marina Lystseva | TASS via Getty Images

The Pentagon swiftly criticized the Russian deployment of warplanes to Venezuela.

"The Venezuelan government should be focusing on providing humanitarian assistance and aid to lessen the suffering of its people and not on Russian warplanes," Pentagon spokesman U.S. Army Col. Rob Manning said at the time of the deployment.

Similarly, Secretary of State Mike Pompeo condemned the Russian military flight on Twitter: "The Russian and Venezuelan people should see this for what it is: two corrupt governments squandering public funds, and squelching liberty and freedom while their people suffer."

Meanwhile, the Kremlin rejected U.S. criticism, saying Pompeo was wrong and undiplomatic to condemn the deployment to Caracas.

"We consider it completely inappropriate," Kremlin spokesman Dmitry Peskov said in response. The Pentagon's Manning then reminded the world that the U.S. military deployed the hospital ship USNS Comfort to South America late last year to provide humanitarian aid to refugees fleeing the desperate conditions.

Since its deployment this summer, the Comfort, a vessel transformed from a hulking oil tanker into a 1,000-bed hospital ship, has treated more than 20,000 people along its stops in various Central and South American nations.

"Contrast this with Russia, whose approach to the man-made disaster in Venezuela is to send bomber aircraft instead of humanitarian assistance," Manning said, knocking Moscow's deployment.

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