Slumping crude oil prices drag stock
market lower
NEW YORK (AP) -- Major stock indexes
skidded 2 percent Tuesday as crude fell for the fifth straight
day.
Falling oil can help the economy by
reducing costs, but investors are looking to the latest slide as an unwelcome
prediction that demand for energy and basic materials will remain weak as the
recession lingers. The Dow Jones industrial average fell 161 points to 8,163.60,
its lowest close since late April.
Trading volume remained light amid a
dearth of news about the economy this week and as investors await the beginning
of the second-quarter earnings season, which starts Wednesday with Alcoa Inc.
but won't pick up speed until next week.
AIG loses big round in lawsuit against
Greenberg
NEW YORK (AP) -- American
International Group Inc. lost a big round Tuesday in its court battle against
former CEO Maurice "Hank" Greenberg.
In an advisory decision, a federal
jury in Manhattan found that a private investment firm controlled by Greenberg
did not have to reimburse AIG for $4.3 billion in shares taken from a company
retirement bonus fund in 2005, shortly after Greenberg was ousted as the
insurer's CEO.
U.S. District Judge Jed S. Rakoff said
he would issue a ruling in the case by the end of
August.
Crude falls below $63 in extended
sell-off
NEW YORK (AP) -- Oil prices fell for
the fifth straight day Tuesday, with a barrel costing $10 less than it did just
one week ago when crude hit a new high for the year.
Benchmark crude for August delivery
settled at $62.93 a barrel on the New York Mercantile Exchange, down
$1.12.
Oil prices had already begun to slide
after peaking last Tuesday, and dismal jobs numbers last week from both the U.S.
and Europe have hastened the decline.
Boeing to pay $580M for 787 parts
plant in SC
UNDATED (AP) -- Boeing Co. will pay
$580 million for a plant that makes large sections of its 787 jetliner, an
apparent effort to reign in supplier problems that have led to costly delays of
the next-generation aircraft and hurt the company's
credibility.
The plant, owned by Vought Aircraft
Industries, makes barrel-like sections of the 787's fuselage that fit between
its wings and tail and are composed primarily of lightweight
materials.
Deliveries of the 787 have been
postponed by nearly two years partly because of problems with components made by
suppliers and work that suppliers didn't complete. Those hang-ups are expected
to cost the airplane maker billions of dollars in added expenses and
penalties.
Auto parts maker Lear Corp. files for
Chapter 11
NEW YORK (AP) -- Automotive parts
supplier Lear Corp. filed for bankruptcy protection on Tuesday after receiving
support from lenders and bondholders to reorganize its struggling
business.
The move had been expected from the
maker of vehicle seats and electronics, which missed an interest payment on its
bond debt last week and revealed its intention to seek Chapter 11 bankruptcy
protection from its creditors. The Southfield, Mich.-based company made the
filing in the U.S. Bankruptcy Court for the Southern District of New
York.
It listed $1.27 billion in assets and
$4.54 billion in liabilities. Subsidiaries outside the U.S. and Canada are not
part of the filings, the company said.
IRS temporarily suspends some small
business fines
WASHINGTON (AP) -- The IRS has
temporarily stopped collecting penalties from some small businesses that have
been hit with big fines for not disclosing the use of questionable tax
shelters.
The fines, which can reach $300,000 a
year, were an unintended consequence of a 2004 law aimed at big corporations
that use the shelters to avoid taxes. Lawmakers asked the Internal Revenue
Service last month to suspend collections while they work to change the
law.
The IRS agreed to suspend collections
through September on cases in which businesses gained less than $200,000 a year
from the tax shelters, IRS Commissioner Doug Shulman said in a letter to
lawmakers released Tuesday.
Consumer loan delinquencies continue
to rise
NEW YORK (AP) -- Consumer loan
delinquencies edged up to another record high in the first quarter, according to
data released Tuesday by the American Bankers
Association.
A continued rise in unemployment has
been the main culprit for the continued rise in delinquencies, the trade
association said.
The composite delinquency rate among
eight types of closed-end installment loans rose to 3.23 percent in the
January-March period, according to the ABA's consumer credit delinquency
bulletin. That is the highest recorded since the ABA began tracking the rate in
the mid 1970s and tops the previous record of 3.22 percent set in the last
quarter of 2008.
Conoco says production up in
2Q
HOUSTON (AP) -- ConocoPhillips, the
third-largest U.S. oil company, said Tuesday second-quarter production rose by
more than 100,000 barrels from a year ago, but lower crude and natural-gas
prices and refining margins are expected to hurt
results.
The company's shares fell more than 2
percent in early trading, along with all major oil companies. In the past week,
the price of crude has dropped more than $10 per
barrel.
In an overview of market conditions
for the April-June period, the Houston-based company said global output was
about 1.86 million barrels of oil equivalent. That's up from 1.75 million
barrels in the second quarter of 2008.
German industrial orders rise in
May
BERLIN (AP) -- German industrial
orders increased by a healthy 4.4 percent in May over the previous month, with
demand from outside Europe rising the most strongly, government figures showed
Tuesday.
The strong performance followed a
minimal 0.1 percent increase in April and adds to other indications that the
outlook for Germany's export-dependent economy -- Europe's biggest -- is
becoming rosier. Recent surveys have shown rising business and consumer
confidence.
The Economy Ministry said orders from
within Germany were up 3.9 percent in May, while those from outside the
16-nation euro zone were up 8.2 percent. Orders from Germany's partners in the
euro zone rose by a comparatively feeble 1.2 percent.
Pickens calls off massive wind farm in
Texas
HOUSTON (AP) -- Plans for the world's
largest wind farm in the Texas Panhandle have been scrapped, energy baron T.
Boone Pickens said Tuesday, and he's looking for a home for 687 giant wind
turbines.
Pickens has already ordered the
turbines, which can stand 400 feet tall -- taller than most 30-story
buildings.
Pickens' company Mesa Power ordered
the turbines from General Electric Co. -- a $2 billion investment -- a little
more than a year ago. Pickens said he has leases on about 200,000 acres in Texas
that were planned for the project, and he might place some of the turbines
there, but he's also looking for smaller wind projects to participate in. He
said he's looking at potential sites in the Midwest and
Canada.
By The Associated
Press
The Dow fell 161.27, or 1.9 percent,
to 8,163.60. It was the lowest finish for the blue chips since April
28.
The broader Standard & Poor's 500
index fell 17.69, or 2 percent, to 881.03, its lowest finish since May 1. The
Nasdaq composite index lost 41.23, or 2.3 percent, to 1,746.17, the lowest close
since May 27.
Benchmark crude for August delivery
settled at $62.93 a barrel on the New York Mercantile Exchange, down
$1.12.
In other Nymex trading, gasoline for
August delivery fell less than a penny to settle at $1.7328 a gallon and heating
oil dropped 2.6 cents to settle at $1.6007. Natural gas for August delivery fell
5.8 cents to settle at $3.429 per 1,000 cubic feet.
In London, Brent prices shed $1.12 to
settle at $63.23 a barrel on the ICE Futures exchange.
(This version CORRECTS Corrects Dow
figure in first item.)