On Tuesday September 21, 2010, 5:53 pm EDT
Fed moves closer to new
action to help economy
WASHINGTON (AP) -- The
Federal Reserve, meeting for the last time before an election that hinges on
the weak economy, edged closer Tuesday to jumping in to help and suggested it's
more worried about prices falling than rising.
The central bank gathered
as new figures showed some improvement in home construction. But those same figures
showed the pace of building would have to double to contribute much to job
growth, underscoring the dire state of the housing market.
The Fed announced no new
steps. It signaled that for now it will stand back and see whether the economy
can heal on its own.
But a change in its policy
language, which is examined with precision by the financial world, showed it
was moving closer to acting.
Homebuilding industry years
away from recovery
WASHINGTON (AP) -- The
homebuilding industry is years away from recovering from the excesses of the
housing boom.
Home construction did rise
10.5 percent in August, to a seasonally adjusted annual rate of 598,000, the
Commerce Department said Tuesday. The results, however, were boosted by a 32
percent jump in apartment and condominium construction, a volatile part of the
market.
Construction of
single-family homes, which represented about 73 percent of the market in
August, grew only about 4 percent from a month earlier. While overall housing
starts are up 25 percent from their bottom in April 2009, they are still 74
percent below their peak in January 2006.
Even with a modest rise in
construction last month, the pace of building would need to at least double to
signal a healthy market and contribute in a meaningful way to job growth,
according to most economists. They don't see that happening until the middle of
the decade.
Stocks mixed as Fed leaves
door open for stimulus
NEW YORK (AP) -- Stocks got
a brief bump following word that the Federal Reserve is ready to do more to
help the economy, but ended mostly lower Tuesday after the central bank
disappointed some investors by not taking any bold new actions.
Treasury prices rallied as
investors saw the Fed's announcement as a signal that more bond purchases were
on the way.
The Fed said it is
concerned that inflation is below levels consistent with a healthy economy and
indicated that it is ready to provide "additional accommodation" to
support the recovery. That would mean more purchases of Treasurys or other
kinds of debt, which would keep interest rates low and hopefully encourage
borrowing.
Twitter hack opens popups,
causes havoc
NEW YORK (AP) -- A new way
to cause mischief quickly spread through short-messaging service Twitter on
Tuesday morning before the site could fix the problem, as mysterious
"tweets" of blocked-out text propagated themselves and caused popup
windows to open.
Shortly before 10 a.m.
Eastern time, (1400 GMT), Twitter said on its "safety" feed on the
site that the attack had been shut down. It also said it does not believe that
any user information was compromised, rather, the "vast majority" of
the breaches were pranks or promotions.
The hack had been extra
nefarious because the tweets activated without being clicked on -- it was
enough for Web surfers to move their mouse cursors over them. But it only
affected visitors to Twitter.com. Various third-party programs used to send and
read tweets, such as Tweetdeck, were unaffected.
Unemployment rises in 27
states last month
WASHINGTON (AP) -- More
than half of U.S. states saw their unemployment rates rise in August, the
largest number in six months, as hiring weakened across the country.
The jobless rate increased
in 27 states last month, the Labor Department said Tuesday. It fell in 13 and
was unchanged in 10 states and Washington, D.C. That's worse than the previous
month, when the rate increased in only 14 states and fell in 18. It's also the
most states to see an increase since February.
Abbott plans 3,000 job cuts
tied to Solvay deal
NORTH CHICAGO, Ill. (AP) --
Abbott Laboratories said Tuesday it will eliminate 3,000 jobs and take almost
$1.3 billion in charges over the next two years as it integrates its Solvay
pharmaceuticals business.
The company said it expects
$810 million to $970 million in restructuring costs and $310 million in
integration costs. The charges include severance costs, write-down and
depreciation costs, and expenses related to the end of some research and
development programs and the transfer of other programs.
Abbott, which employs a
total of almost 90,000 people, said it will cut jobs in manufacturing,
commercial operations, research and development, and staff functions. Most of
the jobs that will be eliminated are based in Europe, and almost all of them are
part of Solvay's operations.
Top economic adviser to
leave White House
WASHINGTON (AP) -- The
White House says President Barack Obama's top economic adviser plans to leave
the administration at the end of the year.
The White House said in a
statement that Lawrence Summers will leave his post as director of the National
Economic Council to return to Harvard University.
Summers departure comes
amid a sluggish economic recovery that has seen unemployment hover near 10
percent. He would be the third high-level member of the Obama economic team to
leave this year, following the resignations of budget director Peter Orszag and
Christina Romer, head of the Council of Economic Advisers.
Irish sell $2B in bonds as
eurozone debt fears ebb
DUBLIN (AP) -- Ireland sold
euro1.5 billion ($2 billion) in government bonds Tuesday in a closely watched
test of whether international investors would keep buying Irish treasuries
despite the country's deficit, the biggest in debt-burdened Europe.
Analysts called the auction
a success, noting it attracted bids 5.1 times the amount of bonds on offer.
Together with solid bond auctions in Spain and Greece, the sale offered markets
reassurance for the moment that Ireland and other indebted countries were
getting some relief from short-term market pressures.
But analysts cautioned that
Ireland had to pay higher-than-expected interest rates compared to previous
bond auctions, reflecting investors' fear of an eventual Irish default. And the
higher rates could be an additional financial burden in coming years.
Adobe 3Q net income soars
as revenue climbs
NEW YORK (AP) -- Software
maker Adobe Systems Inc. said Tuesday its fiscal third-quarter net income
soared, boosted by higher revenue in all its business segments. But Adobe's
shares dropped sharply in extended trading after its revenue outlook
disappointed Wall Street.
San Jose, Calif.-based
Adobe, known for Photoshop software and the Flash technology behind online
games and video websites, earned $230.1 million, or 44 cents per share, in the
three months that ended Sept. 3. That's an increase of 69 percent from $136
million, or 26 cents per share, in the same period a year ago.
Adjusted earnings were 54
cents per share in the latest quarter, surpassing analysts' expectations of 49
cents per share.
By The Associated Press
The Dow Jones industrial
average rose 7.41, or 0.1 percent, to close at 10,761.03. It's still up 7.5
percent for September, an unusually large gain for a month that is historically
weak for stocks.
The Standard & Poor's
500 index slipped 2.94, or 0.3 percent, to 1,139.77, while the Nasdaq composite
fell 6.48, also 0.3 percent, to 2,349.35.
The S&P is still up 8.6
percent for the month, the Nasdaq 11.1 percent.
Benchmark oil lost $1.34 to
settle at $73.52 a barrel on the last trading day for the October contract on
the New York Mercantile Exchange. Many traders moved to the November contract,
where the price fell $1.22 to settle at $74.97 a barrel.
In other Nymex trading in
October energy contracts, heating oil fell 1.95 cents to settle at $2.1199 a
gallon, gasoline lost 3 cents to settle at $1.9196 a gallon and natural gas
gained 9.7 cents to settle at $3.919 per 1,000 cubic feet.
In London, Brent crude fell
94 cents to settle at $78.42 a barrel on the ICE Futures exchange