GM sale cleared, path opens to exit
Chapter 11
DETROIT (AP) -- The path
is now clear for General Motors Corp. to leave bankruptcy protection in record
time as a leaner company that is better equipped to compete in a brutal global
auto market.
On Thursday, a judge's
order allowing GM to sell most of its assets to a new company went into effect,
despite a last-minute appeal by plaintiffs in a product liability
case.
GM spokeswoman Julie
Gibson said U.S. Bankruptcy Judge Robert Gerber's order became effective at 12
p.m. EDT. GM lawyers are working on paperwork to close the sale as quickly as
possible, after which GM would leave bankruptcy
protection.
Gains in financials,
material stocks lift market
NEW YORK (AP) -- Stocks
edged higher Thursday as investors put money into banking and industrial stocks
as well as commodities. Investors worried about the economy have been cautious
about buying stocks, even after heavy selling earlier this week made shares look
relatively cheap.
Investors were encouraged
by better-than-expected results from aluminum maker Alcoa Inc., which started
second-quarter earnings season and stoked hopes for more upbeat corporate
reports to come.
The gains were tempered by
weak sales reports from retailers and evidence that the labor market is still
hurting. The Dow Jones industrial average tacked on 5 points to 8,183.17, a
second day of modest gains after tumbling 161 points
Tuesday.
Jobless claims indicate
economy remains weak
WASHINGTON (AP) -- Even
though new claims for jobless benefits fell more than expected last week,
dipping below 600,000 for the first time since early January, the number of
Americans seeking this safety net points to an economy that is still very
weak.
Layoffs are slowing, but
jobs are scarce, leaving nearly 7 million Americans collecting unemployment
checks and retailers looking for customers.
The number of newly
laid-off workers requesting unemployment insurance fell by 52,000 to a
seasonally-adjusted 565,000, the Labor Department said Thursday. But the drop
was mostly due to a shift in the timing of auto-related layoffs, leading many
economists to discount the decline.
Weak retail sales in June
raise worries
NEW YORK (AP) -- After yet
another weak month, retailers are preparing to fight for their share of crucial
back-to-school shopping. But they may have to keep discounting to keep consumers
coming in, given escalating job uncertainty.
Particularly worrisome in
Thursday's same-store sales reports: Mall-based teen stalwarts like Abercrombie
& Fitch were among those hit hardest as families looked for
bargains.
Wal-Mart Stores Inc., the
world's largest retailer, is expected to be a big winner as it woos young
shoppers with trendy electronics and fashions, but its sales are no longer
included in the monthly data.
World leaders vow to
restart stalled trade talks
L'AQUILA, Italy (AP) --
Leaders of the exclusive club of eight industrialized leaders plus five of the
fastest developing nations are calling for open markets and a battle against
protectionism as the answer to the world's economic
meltdown.
But the need to save jobs
back home is pulling them in the opposite direction. How can the goal set by the
leaders -- completing a long-stalled world trade deal by next year -- be
reconciled with major pressures to protect local
industries?
Meeting in the
quake-stricken Italian city of L'Aquila, the leaders said they wanted to finally
reach an agreement next year on a long-stalled world trade deal, according to a
draft of a joint declaration obtained by The Associated Press. It's a familiar
pledge that has failed to prompt action in the past.
Oil wavers near $60 as
consumers scale back
NEW YORK (AP) -- Oil
prices wavered around $60 per barrel Thursday with new consumer and employment
data casting a pall over energy markets, but still rose slightly at the close
for the first time in more than a week.
Benchmark crude for August
delivery rose 27 cents to settle at $60.41 a barrel on the New York Mercantile
Exchange. Still, crude prices in intraday trading fell below $60 for the first
time since May.
Consumers fearful of job
cuts, or those who lost jobs, are spending less, which has dragged down
everything from retail to gasoline sales.
Citigroup shuffles
executives, former CFO leaving
NEW YORK (AP) -- Citigroup
Inc. shuffled its top management again Thursday, naming its third chief
financial officer of the year and bringing in a new head of its Citibank
division as it returns its focus to traditional
banking.
Edward Kelly, who took
over as the bank's finance chief in March, is on the move for the second time in
less than five months and will now oversee strategy and mergers in a new role as
vice chairman. John Gerspach, 56, currently the bank's chief accounting officer,
is taking over as CFO.
Gary Crittenden, who
served as CFO until being replaced by Kelly in March, is leaving the company
altogether.
SEC to call for Calif.
IOUs treated as securities
WASHINGTON (AP) -- The
recipients of billions of dollars in IOUs being issued by California soon may
have a regulated market where they could sell them.
Some of the nation's
largest banks say that, starting Friday, they will no longer accept the IOUs.
The banks want to pressure the state to end its budget impasse, but their action
could leave many businesses and families with fewer options for getting their
money.
The Securities and
Exchange Commission is going to recommend that the IOUs, which carry an annual
interest rate of 3.75 percent, be regulated by the Municipal Securities
Rulemaking Board as a form of municipal debt.
GM, Chrysler fight
reopening of closed dealerships
WASHINGTON (AP) -- General
Motors and Chrysler urged lawmakers Thursday to block legislation that would
prevent them from consolidating their dealership networks, warning it would
complicate their emergence from government-led
bankruptcies.
With GM poised to exit
bankruptcy protection, company leaders pressed House members to overturn an
amendment approved late Tuesday by a House committee that would force General
Motors Corp. and Chrysler LLC to restore franchise agreements with dealers as a
condition of partial government ownership.
The Michigan auto
companies are closing nearly 3,000 dealerships as part of their sweeping
reorganization plans under bankruptcy protection, a move supported by the Obama
administration.
Sprint Nextel signs
networking deal with Ericsson
KANSAS CITY, Mo. (AP) --
Sprint Nextel Corp. on Thursday announced it will transfer operation of its
wireless and wireline networks to Swedish telecommunications equipment maker LM
Ericsson.
The seven-year deal,
valued between $4.5 billion and $5 billion, will transfer about 6,000 Sprint
employees later this year to an Ericsson-owned subsidiary, based at Sprint's
Overland Park, Kan., headquarters. About 2,000 of the employees are currently
based in the Kansas City area with the remainder spread across the
country.
By The Associated
Press
The Dow rose 4.76, or 0.1
percent, to 8,183.17.
The Standard & Poor's
500 index rose 3.12, or 0.4 percent, to 882.68, while the Nasdaq composite index
gained 5.38, or 0.3 percent, to 1,752.55.
Benchmark crude for August
delivery rose 27 cents to settle at $60.41 a barrel on the New York Mercantile
Exchange.
In other Nymex trading,
heating oil fell less than a penny to settle at $1.5344 a gallon, but gasoline
for August delivery rose 3.05 cents to settle at $1.6638 a gallon. Natural gas
for August delivery rose 5.5 cents to settle at $3.408 per 1,000 cubic
feet.
In London, Brent prices
rose 67 cents to settle at $61.10 a barrel on the ICE Futures exchange.