Job worries persist; Americans gloomy on economy
NEW YORK (AP) -- Americans are looking past the stock market
surge and signs of a stabilizing economy and focusing on something more
personal -- job worries.
Consumer confidence fell this month, the Conference Board said
Tuesday, presenting a big obstacle for already hammered stores as they head
into the critical back-to-school shopping season.
The confidence index fell to 46.6, down from 49.3 in June and
weaker than what economists were expecting. It takes a reading above 90 to
signal Americans believe the economy is on solid footing.
It was the second straight month of declining confidence.
Index adds to spate of upbeat housing news
NEW YORK (AP) -- There were fresh signs Tuesday that home prices
in much of the country are stabilizing and the housing market is on the mend.
Home prices in May posted their first monthly increase since the
summer of 2006, according to the Standard & Poor's/Case-Shiller 20-city
index. Prices rose from April in 13 of the cities tracked, notably Cleveland,
Dallas and Boston.
The news follows upbeat reports showing sales of newly built and
existing homes rose in June for the third straight month. And new home
construction, while still weak, is the best it's been since the fall.
The 20-city home price index rose 0.5 percent from April to a
reading of 139.8, but was still 17.1 percent below the reading of 168.6 in May
a year ago. It was the fourth consecutive month the index indicated prices have
turned the corner and are heading back toward positive territory.
Govt considers limits on energy trading
WASHINGTON (AP) -- With consumers hit by oil price swings,
federal regulators may be moving toward imposing limits on speculative energy
trading, which some blame for price volatility.
The head of the U.S. agency weighing new curbs on Tuesday faulted
"excessive" speculation but also underscored the role of financial
investors in helping set fair prices that can benefit consumers.
Gary Gensler, chairman of the Commodity Futures Trading
Commission, said his agency must "seriously consider" imposing
stringent limits on speculative trading of energy futures contracts, a move
that would mark a major shift for the government.
Oil rally sputters; prices near $67 per barrel
COLUMBUS, Ohio (AP) -- A two-week rally in oil markets sputtered
Tuesday and crude prices fell along with the stock market.
Prices first dipped in electronic trading before the market
opened and then dropped sharply when new data suggested consumers are less
confident than ever about their jobs and the economy as a whole.
Economic anxiety has kept people closer to home this year and the
most energy-intense industries have cut back on production.
Stocks end flat on mixed economic data, earnings
NEW YORK (AP) -- An economic reality check is cooling the stock
market's rally.
Stocks ended little changed Tuesday as a key barometer of
consumer confidence and a handful of disappointing earnings reports reminded
investors that an economic recovery this year is far from assured. The Dow
slipped 12 points, while the Nasdaq composite index posted a small gain.
Trading was more erratic Tuesday than the past two days, however
in all three days the major market indexes closed with only modest changes.
Investors remain cautious but still aren't willing to give up on a rally that
has propelled stocks up 11 percent in little more than two weeks.
'Clunkers' program draws car buyers in first days
NEW YORK (AP) -- Car and truck owners looking to junk their gas
guzzlers are flocking to dealerships to take advantage of the government's
"cash for clunkers" program and buy more fuel-efficient vehicles,
boosting sales in showrooms across the country.
The program -- officially called the Cash Allowance Rebate
System, or CARS -- took effect over the weekend at the nearly 20,000 car
dealers who have signed up with the Department of Transportation. The program
offers rebates of $3,500 to $4,500 for car shoppers who scrap their old
vehicles to buy ones with better gas mileage.
Congress passed CARS earlier this year to help boost flagging
sales and get some of the filthiest cars and trucks off the nation's roads.
Nationally, new vehicle sales are down 35 percent for the first half of the
year, and the downturn has been devastating for automakers and dealers alike.
IBM scoops up software maker SPSS in $1.2B deal
SAN FRANCISCO (AP) -- IBM Corp. is bulking up its most profitable
division with a $1.2 billion acquisition of business software provider SPSS
Inc., a deal that also reflects the power of wealthy technology companies to
throw their money around despite the recession.
The all-cash deal announced Tuesday represents a 42 percent
premium over Chicago-based SPSS's closing price of $35.09 on Monday.
SPSS's technology is used to comb through stockpiles of data to
predict things such as how a customer will respond to a particular sales pitch,
or where hot spots for crime are and where police should be deployed. The
company claims its customers include agencies in all U.S. state governments,
top U.S. universities and consumer goods, pharmaceutical and market-research companies.
Sprint focuses on prepaid with Virgin Mobile deal
NEW YORK (AP) -- Sprint Nextel Corp. is intensifying its focus on
the fast-growing market for prepaid cell phone service with a $483 million deal
to buy Virgin Mobile USA Inc.
The acquisition announced Tuesday calls for Sprint to pay $5.50
in stock for each Virgin Mobile share. Sprint already owned 13.1 percent of
Virgin Mobile, which uses Sprint's network to offer service.
The offer comes at a 31 percent premium to Virgin Mobile's
closing share price Monday of $4.21. The shares closed up $1.07, or 25.4
percent, to $5.28 Tuesday.
Like other prepaid vendors, Virgin Mobile primarily targets
customers who lack the credit or income to sign long-term contracts or simply
want a bargain over contract-based plans. It has 5.2 million subscribers who
pay an average of $20 per month. Sprint has 49.1 million subscribers, including
those using the network through wholesalers like Virgin Mobile.
Viacom: Ad outlook good despite 2Q drop in profits
NEW YORK (AP) -- Viacom Inc. struck a hopeful note on advertising
for the rest of the year even as the media conglomerate controlled by Sumner
Redstone saw second-quarter profit plunge on weak ad markets, video game sales
and box-office returns.
Viacom CEO Philippe Dauman said the company, which owns the BET
and MTV cable TV networks, was "very pleased" with the nearly
completed bidding in the so-called "upfronts," in which media buyers
bid on commercial time ahead of the coming TV season.
New York-based Viacom declined to give specifics on the volume or
pricing of ad time it has sold so far.
Viacom, which also owns the Paramount Pictures movie studio and
the "Rock Band" video game franchise, said it earned $277 million, or
46 cents per share, in the most recent quarter, a 32 percent drop from $407
million, or 65 cents per share, a year earlier.
US Steel reports 2Q loss as demand remains low
PITTSBURGH (AP) -- United States Steel Corp. posted its second
straight quarterly loss Tuesday as the global slowdown stifled orders and prices
for the metal, and it forecast that its third quarter results would stay in the
red.
The largest U.S.-based steelmaker and other producers have been
hurt by sharply lower orders from steel-intensive industries such as
construction and autos. While demand and prices have picked up recently, they
remain well below record levels reached last summer.
U.S. Steel lost $392 million, or $2.92 per share, in the three
months ended June 30. That compares with a profit of $668 million, or $5.65 per
share, in the year-earlier period. A gain from foreign currency exchange
narrowed the latest loss by $41 million, or 31 cents per share.
By The Associated Press
The Dow Jones industrial average slipped 11.79, or 0.1 percent,
to 9,096.72. The broader Standard & Poor's 500 index fell 2.56, or 0.3
percent, to 979.62. The Nasdaq composite index rose 7.62, or 0.4 percent, to
1,975.51 after several technology companies announced acquisitions.
Benchmark crude for September delivery fell $1.15 to settle at
$67.23 a barrel in trading on the New York Mercantile Exchange.
In other Nymex trading, gasoline for August delivery fell 2.41
cents to settle at $1.9106 a gallon and heating oil lost 2.99 cents to settle
at $1.7647. Natural gas for August delivery fell 6.9 cents to settle at $3.535
per 1,000 cubic feet.
In London, Brent crude prices
fell 93 cents to settle at $69.88 a barrel on the ICE Futures exchange.