AP Business Highlights

S&P cuts long-term outlook for US debt to negative

WASHINGTON (AP) -- Standard & Poor's Ratings Service downgraded its outlook Monday on U.S. government debt, expressing unprecedented doubts over the ability of Washington to bring the massive federal budget deficits under control.

The agency lowered the long-term outlook to "Negative" from "Stable," saying there is a one in three chance the United States could lose its top investment rating on its debt in the next two years.

S&P said it has little confidence that the White House and Congress will agree on a deficit-reduction plan before the fall 2012 elections and doubts any plan would be in place until after 2014.

Builder outlook falls ahead of spring season

WASHINGTON (AP) -- Homebuilders are more pessimistic about the housing market this month, a dismal sign at the start of the spring-buying season.

The National Association of Home Builders says its index of industry sentiment for April fell back down to 16. It had risen modestly in March to 17, after four straight months at 16. Any reading below 50 indicates negative sentiment about the market. The index hasn't been above that level since April 2006.

Synthes confirms J&J deal being discussed

GENEVA (AP) -- U.S.-Swiss medical device maker Synthes Inc. confirmed Monday it is in talks to be bought out by health giant Johnson & Johnson, in a deal that could make its chairman Switzerland's richest man.

Synthes said it was talking with Johnson & Johnson about "a potential business combination transaction" but gave no financial details when confirming the recent market speculation.

Synthes makes surgical instruments, implants and materials for repairing bone and soft tissue. Johnson & Johnson, which is under close Food and Drug Administration scrutiny over repeated product recalls, hopes to boost its medical equipment business.

Greek debt crisis haunts markets again

LONDON (AP) -- Europe's debt crisis returned to haunt markets Monday as investors fretted over a possible Greek default and the impact of huge gains for a nationalist party in Finland.

Portugal also began discussions on a financial bailout and Spain had to pay a much higher interest rates to tap bond investors.

Citi's Q1 profit falls 32 percent on lower loans

NEW YORK (AP) -- Citigroup's first-quarter income fell 32 percent on lower revenue from investment banking and a decline in consumer loans. The bank was able to set aside fewer reserves for losses as more borrowers were able to keep up with their debt payments.

The New York bank said Monday that it earned $3 billion, or 10 cents per share, compared with $4.4 billion, or 15 cents a share in the first quarter of last year. The earnings were slightly higher than the 9 cents per share estimated by analysts surveyed by FactSet.

Drugmaker Eli Lilly's 1Q profit falls 15 percent

INDIANAPOLIS (AP) -- Eli Lilly and Co.'s first-quarter profit fell 15 percent because of severance costs and a development agreement designed to help the drugmaker weather a wave of patent expirations that will start hitting later this year.

The Indianapolis company in the next two years will lose U.S. patents protecting drugs that produced 46 percent of its 2010 revenue. That starts in October, with the patent protecting its top-seller, the antipsychotic Zyprexa, from competition from lower-priced generic versions.

Community Health makes all-cash bid for Tenet

NEW YORK (AP) -- Hospital operator Community Health Systems Inc. on Monday revised its $3 billion offer for rival Tenet Healthcare Corp. to an all-cash bid.

Community Health is now offering $6 per share in cash. In December, it had gone public with a bid of $5 per share in cash and $1 per share in stock. At the time, the offer was a premium of about 40 percent to the Dallas company's shares.

Nissan to fix software glitch in electric car

DETROIT (AP) -- Nissan Motor Co. is calling 5,300 Leaf electric cars back to dealerships to fix a software glitch that can keep them from starting.

The company said in a statement that a small number of Leafs worldwide have experienced the problem, so it will reprogram the engine control computer free of charge.

The fix, which includes about 500 Leafs in the U.S., takes about an hour.

Wal-Mart Stores CEO gets $18.7M 2010 pay package

NEW YORK (AP) -- The CEO of Wal-Mart Stores Inc. received a pay package in 2010 worth $18.7 million, a 4 percent dip from the year before, according to an Associated Press calculation, as the world's largest retailer struggled to reverse a decline in a key revenue figure.

Mike Duke, 61, received a base salary of about $1.2 million and a performance-based bonus of nearly $3.9 million for the fiscal year that ended Jan. 31.

His performance-based bonus fell 20 percent from 2009 because the company's U.S. stores performed below its targets, Wal-Mart said in a filing Monday with the Securities and Exchange Commission.

Dish to take over about 500 Blockbuster leases

NEW YORK (AP) -- Blockbuster's soon-to-be parent company Dish Network Corp. has agreed to take on leases for hundreds of Blockbuster stores, ensuring the video rental chain will continue to have a physical presence.

Dish filed papers with the U.S. Bankruptcy Court Southern District of New York on Saturday indicating it has agreed to assume about 500 leases. Blockbuster has closed numerous stores and now operates about 1,700 across the U.S. A hearing on Dish's assumption of the leases is set for Thursday.

By The Associated Press(equals)

The Dow Jones industrial average fell 140.24 points, or 1.1 percent, to close at 12,201.59. The Standard & Poor's 500 fell 14.54, or 1.1 percent, to 1,305.14. The Nasdaq composite fell 29.27, also 1.1 percent, to 2,735.38.

Benchmark West Texas Intermediate crude fell $2.54, or 2.3 percent, to settle at $107.12 per barrel on the New York Mercantile Exchange.

In other Nymex trading for May contracts, heating oil lost 4.14 cents to settle at $3.1828 per gallon and gasoline futures gave up 3.64 cents to settle at $3.2528 per gallon. Natural gas lost 6.6 cents to settle at $4.138 per 1,000 cubic feet.

In London, Brent crude lost $1.84 to settle at $121.61 per barrel on the ICE Futures exchange.

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