AP Business Highlights

Companies:

·                     Cisco Systems, Inc.

·                     Macy's, Inc.

 

On Wednesday August 11, 2010, 5:51 pm EDT

Trade gap likely points to slower economic growth

WASHINGTON (AP) -- The United States is selling fewer products around the world and spending more on cheap imported goods, an imbalance that hurts the job market at home and means the economy is even weaker than previously thought.

The trade deficit of nearly $50 billion for June is the biggest in almost two years, and economists fear that economic growth for the second quarter, which came in at a sluggish rate of 2.4 percent in early estimates, may turn out to be only half that.

Exports for June were down 1.3 percent, to $150.5 billion, the Commerce Department reported Wednesday. At the same time, imports rose 3 percent, to just over $200 billion.

Company job openings drop for 2nd straight month

WASHINGTON (AP) -- Company job openings fell for the second straight month in June, a sign that hiring isn't likely to pick up in the coming months.

The data comes after a weak employment report Friday that showed businesses aren't adding enough new workers to bring down the unemployment rate, currently 9.5 percent.

Wednesday's report, known as the Job Openings and Labor Turnover survey, or JOLTS, suggests that won't change anytime soon.

Stocks fall sharply as investors' gloom grows

NEW YORK (AP) -- Stocks and interest rates fell sharply Wednesday as more bad news chipped away at investors' view of the economy.

The Dow Jones industrial average fell 265 points and all the major indexes fell more than 2 percent. The Dow has now fallen four days out of five, and it has lost almost 320 points in just the past two days. Meanwhile, the yield on the Treasury's 10-year note fell to its lowest level since March 2009 as investors worried about the economy and avoiding stocks sought the safety of government securities.

Dollar slides vs yen as Fed tries to stabilize US

NEW YORK (AP) -- The dollar tumbled to a 15-year low Wednesday versus the Japanese yen after the Federal Reserve said it expected a weaker U.S. recovery and took steps to support the economy.

The dollar surged against most other currencies around the world, however, with investors still seeking access to one of the world's favorite places to park funds, short-term U.S. Treasurys, as economic reports and forecasts Wednesday from the U.S. to Asia to the U.K. suggested a slowdown in the world recovery.

The euro, which is used by 16 European countries, fell below $1.30 for the first time this month.

Cisco income up 79 pct, stock down on revenue miss

NEW YORK (AP) -- Cisco Systems Inc. reported stronger earnings in the latest quarter as its customers continued to catch up on delayed purchases of networking gear, but its CEO said the company was seeing signs of the economic recovery slowing down.

Shares in the world's largest maker of computer networking gear fell Wednesday as revenue missed Wall Street expectations.

Cisco CEO John Chambers also provided a sales forecast for the new quarter that came in below expectations. The company's sales are heavily dependent on capital spending at large corporations, phone companies and government agencies across the world, and an uncertain economy means those customers may spend less.

Federal deficit running below last year's record

WASHINGTON (AP) -- With two months to go in the budget year, the federal deficit is on pace to come in just under last year's record high in an election year when government spending has drawn voter ire.

The Treasury Department said Wednesday that the deficit for July totaled $165 billion, pushing the imbalance so far this year to $1.17 trillion. That is down 7.7 percent from the same period last year. It reflects lower spending on emergency programs to combat the recession and stabilize the financial system. The federal budget year ends September 30.

Macy's profit surges in the 2Q; boosts outlook

NEW YORK (AP) -- Macy's Inc.'s net income surged in the second quarter as the department store chain saw a payoff from its focus on exclusive moderate-price fashions and tailoring merchandise to local markets.

The company, based in Cincinnati, boosted its profit outlook and increased its forecast for a key revenue measure as it takes market share from rivals such as J.C. Penney.

The chain said Wednesday that it posted net income of $147 million, or 35 cents per share, for the period ended July 31. That compares with $7 million, or 2 cents per share, in the same period last year.

Median home prices up in 2Q in most US cities

WASHINGTON (AP) -- Home prices rose in nearly two-thirds of U.S. cities this spring as buyers took advantage of tax incentives that gave the struggling housing market a temporary jolt.

The median sales price for previously occupied homes rose compared with last year in 100 out of 155 metropolitan areas tracked in the April-to-June quarter, the National Association of Realtors said Wednesday. That compares with 91 out of 152 cities in the January-to-March quarter. Fourteen cities had double-digit price increases.

Obama administration to provide $3B in housing aid

WASHINGTON (AP) -- The Obama administration is providing $3 billion to unemployed homeowners facing foreclosure in the nation's toughest job markets.

The Treasury Department said Wednesday it will send $2 billion to 17 states that have unemployment rates higher than the national average for a year. They will use the money for programs to aid unemployed homeowners. Some of those states have already designed such programs.

China's industrial growth slows, inflation jumps

BEIJING (AP) -- China's industrial growth slowed further in July as Beijing clamped down on a credit boom, fueling expectations it will ease monetary policy to shore up its economic expansion.

Inflation spiked to its highest level this year as summer flooding wrecked crops but analysts said the increase will likely prove temporary.

The government data Wednesday added to signs China's boom is cooling and fed expectations Beijing needs to reverse course after imposing lending curbs this year to prevent a bubble in stock and real estate prices.

By The Associated Press

The Dow dropped 265.42, or 2.5 percent, to 10,378.83, its largest slide since it fell 268.22 on June 29.

The Standard & Poor's 500 index fell 31.59, or 2.8 percent, to 1,089.47. The S&P 500 slipped below 1,100, a key psychological level. Falling and holding below that level could lead to more selling as computer-driven trading sets in.

The Nasdaq composite index fell 68.54, or 3 percent, to 2,208.63. The Nasdaq tends to have the biggest losses when stocks are falling sharply because many of its component companies are smaller businesses that struggle the most in a weak economy.

Benchmark crude for September delivery fell $2.23 to settle at $78.02 a barrel on the New York Mercantile Exchange.

In other Nymex trading in September contracts, heating oil fell 5.02 cents to settle at $2.0752 a gallon, gasoline slid 8.77 cents to settle at $1.9976 a gallon and natural gas settled up 2.9 cents at $4.326 per 1,000 cubic feet.

In London, Brent crude dropped $1.96 to settle at $77.64 on the ICE Futures exchange.