On Friday February 4, 2011, 6:15 pm EST
Unemployment falls to 9
percent, lowest since 2009
WASHINGTON (AP) -- The
unemployment rate is suddenly sinking at the fastest pace in a half-century,
falling to 9 percent from 9.8 percent in just two months -- the most
encouraging sign for the job market since the recession ended.
More than half a million
people found work in January. A government survey found weak hiring by big
companies. But more people appear to be working for themselves or finding jobs
at small businesses.
The steepest two-month
decline in unemployment since the Eisenhower administration is the latest sign
that the economic recovery is picking up speed.
The service sector and
manufacturing are growing again at pre-recession rates. The Dow Jones
industrial average closed above 12,000 this week for the first time since
mid-2008. And retail sales have reached a five-year high.
Yields on government bonds
rose after the unemployment report came out, a sign that bond traders think the
job market is improving and will lift the economy after a year and a half of
only modest growth.
An unemployment rate of 9
percent remains very high by historical standards. But the swift decline in the
rate could also lift confidence at a time when businesses and individuals are
already spending more money, fueling more hiring and still-more spending.
Unemployment has not been
this low since April 2009.
Report: Egypt protests cost
$310M per day
CAIRO (AP) -- Egypt's
economy has lost at least $3.1 billion as a result of the political crisis in
the country, investment bank Credit Agricole said in a report released on
Friday, as tens of thousands of protesters massed in downtown Cairo demanding
the president's ouster.
The unrest that began on
Jan. 25 led to the shuttering of businesses and companies, the closure of banks
and the stock exchange and the exodus of thousands of tourists as the
demonstrations. The ensuing violence almost overnight drove a nation once seen
as a pillar of stability to the brink of chaos.
Credit Agricole, in one of
the first assessments quantifying the damage to the economy, said the crisis is
costing Egypt at least $310 million per day. The bank also revised down its
forecast for 2011 GDP growth to 3.7 percent from 5.3 percent and said the
Egyptian pound could see a depreciation of up to 20 percent.
The losses are the tip of
the iceberg of Egypt's economic woes.
Any post-crisis government
will face major challenges in rebuilding the country's image and dealing with a
range of fundamental economic problems that are sure to be exacerbated by the
unrest.
Aetna announces big
dividend, profit jumps 30 pct
INDIANAPOLIS (AP) -- Shares
of Aetna Inc. shot up 11 percent in early trading Friday after the health
insurer announced a significantly higher dividend payment for shareholders and
predicted its 2011 profit will be much bigger than what Wall Street expects.
The Hartford, Conn.,
company also said its fourth-quarter net income rose 30 percent due in part to
better pricing and a slowdown in health care use that also has helped its
competitors in the last few months of 2010.
Aetna will now pay a 15-cent
quarterly dividend on April 29 to shareholders as of April 14. Big health
insurers normally offer token dividends like the 4-cent annual one Aetna paid
Nov. 30, but that started to change last year when competitor UnitedHealth
Group Inc. announced a quarterly dividend of 12.5 cents per share.
The steady cash flow from
larger dividends can make a company's stock more attractive to investors.
Looking ahead, the company
forecast a 2011 operating profit between $3.70 and $3.80 per share, much higher
than the average analyst expectation of $3.27 per share, according to FactSet.
Several analysts said in
Friday morning notes they were surprised by Aetna's 2011 forecast.
Analysts have said insurers
will be squeezed next year by health care use that is expected to return to
normal levels, low interest rates and a new health care overhaul mandate
regulating the percentage of premiums they spend on care.
Verizon sees 'record'
first-day sales with iPhone
NEW YORK (AP) -- Verizon
Wireless on Friday said its first day of taking online orders for the iPhone
produced record sales, and it's stopped taking orders until Wednesday.
The cell phone carrier said
that in just two hours Thursday morning, between 3 a.m. and 5 a.m., more
customers had ordered the phone than in the full day of any previous phone
launch.
The company didn't specify
how many iPhones had been ordered. It halted orders at 8:10 p.m. Thursday, and
said it will resume taking orders at 3 a.m. on Wednesday.
It's only taking orders
from current Verizon subscribers. The phone will be available in stores for the
general public next Thursday, but supplies are likely to be tight.
AT&T Inc. has so far
been the exclusive carrier of Apple Inc.'s popular phone in the U.S. It
activated 15.2 million of them last year. Analyst estimates for Verizon iPhone
sales this year vary widely, from 5 million to 13 million. Analysts expect the
sales to Verizon subscribers will be strong, but the big question is how many
iPhone buyers will be jumping ship from other carriers.
Barclays Capital analyst
James Ratcliffe wrote in a research note Friday that he had been expecting that
AT&T would still be able to add a net 250,000 subscribers on contract-based
plans in the first quarter, but news of the strong iPhone pre-orders on Verizon
prompted him to lower that forecast to zero.
Eurozone leaders seek
better economic coordination
BRUSSELS (AP) -- Germany
and France pressed weaker eurozone countries to make their economies stronger
to help pull the currency union out of its financial morass and gave their
approval to strengthening the bailout fund that remains the bloc's first line
of defense against the crisis.
But they held off for now
on concrete economic proposals that could provoke political resistance, leaving
a large raft of issues to sort through in coming weeks as financial markets
wait to see results.
While Berlin and Paris
presented their plans Friday as a sign of the bloc growing closer together --
and reinforcing confidence in the shared currency -- some think that the steps
fall short of the bold steps many say are required to keep the euro safe and
may even distract from more urgent crisis measures.
The conclusions of Friday's
summit are the first written confirmation of the much discussed closer economic
coordination among eurozone states and the overhaul and increase of the bailout
fund, but the statements from eurozone leaders opened more questions than they
answered.
Spanish economy grew 0.2
percent in Q4
MADRID (AP) -- Spain's
central bank said Friday the economy grew 0.2 percent in the fourth quarter
compared to the third, and that for all of 2010 it contracted less than the
government had forecast -- good news for a country trying to dispel fears it
might need a bailout.
The Bank of Spain said it
estimates gross domestic product fell 0.1 percent in 2010, less than the 0.3
percent decline officially forecast in the latest budget.
The bank's quarterly GDP
figures are preliminary. They are usually followed a week later by official
numbers from the National Statistics Institute, although these tend to agree
with the bank's.
Spain is struggling to
overcome nearly two years of recession prompted in large part by the collapse
of a credit-fueled spending spree and real estate bubble.
Tyson Foods reports jump in
1Q earnings
T. LOUIS (AP) -- Tyson
Foods' net income jumped 86 percent jump its fiscal first quarter, helped by
improving chicken sales and rising prices for beef and pork, the meat producer
said Friday.
Tyson's shares climbed 6.2
percent to $18.65 in morning trading Friday.
The improvement is a strong
signal the meat producer, based in Springdale, Ark., has recovered from an
industry downturn brought on by a combination of higher production costs and
slumping demand as shoppers cut spending.
CEO Donnie Smith said the
company has cut $600 million in annual costs since 2008, when it was first
battered by historically high grain prices. Smith said the cuts put Tyson in a
good position to handle higher feed costs predicted for 2011, even as demand
for chicken is expected to be flat.
The company expects to cut
an additional $200 million in costs this year.
Clorox 2Q earnings drop,
sales decline
Clorox Co. failed to clean
up in its second quarter but says it sees better times ahead as it expands its
product lines, controls costs and raises prices.
The maker of cleaning
products, Hidden Valley Ranch salad dressing and other products reported Friday
that its net income slid 81 percent on softer sales and a charge to write down
the value of its Burt's Bees business.
Clorox, based in Oakland,
Calif., reported net income of $21 million, or 15 cents per share, for the
quarter. That's down from $110 million, or 77 cents per share, in the same
period last year.
Excluding a $258 million
charge tied to Burt's Bees, the company earned 68 cents per share, compared
with 66 cents per share in the same period last year. Analysts polled by
FactSet expected 46 cents per share.
Revenue fell 3 percent to
$1.18 billion, narrowly missing analyst expectations of $1.19 billion.
Revenue declined for both Clorox's
cleaning and household segments.
The cleaning business dealt
with lower shipments of wipes and other disinfecting products, as concerns
about the swine flu virus, which boosted last year's results, evaporated.
By The Associated Press
The Dow Jones industrial
average rose 29.89 points, or 0.3 percent, to close at 12,092.15. The Dow
climbed 2.3 percent for the week and has posted gains for nine of the last 10
weeks. The average of 30 large company stocks cleared the 12,000 mark Tuesday,
the first time it closed above that level since June 2008.
The Standard & Poor's
500 index rose 3.77 points, or 0.3 percent, to 1,310.87. The Nasdaq composite
gained 15.42 points, or 0.6 percent, to 2,769.30.
The S&P 500 rose 2.7
percent for the week and the Nasdaq 3 percent.
Benchmark West Texas
Intermediate crude for March delivery fell $1.51 to settle at $89.03 per barrel
on the New York Mercantile Exchange. In London, Brent crude lost $1.93 to
settle at $99.83 per barrel on the ICE Futures exchange.
In other Nymex trading for
March contracts, heating oil fell 5 cents to settle at $2.7167 per gallon and
gasoline futures dropped 6.8 cents to settle at $2.4353 per gallon. Natural gas
lost 2.7 cents to settle at $4.310 per 1,000 cubic feet.