On Friday September 24, 2010, 5:50 pm EDT
Stocks reignite a rally as
economic woes fade
NEW YORK (AP) -- Stock rose
sharply on Friday, giving the market its fourth straight week of gains, after a
sharp increase in orders for manufactured goods allowed investors to shake off
several days of doldrums.
The Dow Jones industrial
average jumped nearly 200 points, its first gain in three days. The market has
now had its longest weekly winning streak since stocks rose to their highest
levels of the year in late April.
A surprise jump in durable
goods orders and corporate spending provided the boost to U.S. stocks, as did a
strong earnings report from Nike Inc. In Europe, shares also rose after German
business confidence rose unexpectedly to its highest level in over three years.
Business spending on
capital goods rises in August
WASHINGTON (AP) -- U.S.
companies invested last month in computers, communications equipment and
machinery, boosting capital goods orders for the third time in four months.
The 4.1 percent increase to
capital goods in August signaled a rebound in business spending after orders
fell 5.3 percent in July. It also suggests manufacturing, which has helped
drive economic growth since the recession ended in June 2009, is still a bright
spot in a weak recovery.
The overall demand for
durable goods fell 1.3 percent in August, the Commerce Department said Friday.
But that was pulled down by a significant drop in orders for aircraft. When
excluding the volatile transportation sector, orders rose 2 percent -- the best
showing in five months.
Pace of new home sales
second slowest on record
WASHINGTON (AP) -- New
homes sold at the second-slowest pace on record in August, signaling that the
housing market will remain a drag on the economy.
Last month's new home sales
were unchanged from a month earlier at a seasonally adjusted annual sales pace
of 288,000, the Commerce Department said Friday. Sales were down by 29 percent
from the same month a year earlier.
Normally the building
industry powers economic recoveries. But housing has been at the center of this
downturn and it shows no signs of recovering quickly.
Gov't seizes 3 failing
wholesale credit unions
WASHINGTON (AP) --
Regulators are taking over three companies that provide financing for U.S.
credit unions, after the companies suffered massive losses on mortgage
investments and were short cash.
The takeovers are the
latest evidence that the banking industry is still plagued by bad mortgage
debt.
The government regulator
says it will wind down the companies by reselling up to $50 billion worth of
securities that lost value after the housing market crashed in 2007. The debt
will be repackaged and offered to private investors. It will be backed by the
credit of the U.S. Treasury.
Newark mayor's
crime-fighting led to $100M gift
NEWARK, N.J. (AP) --
Facebook founder Mark Zuckerberg on Friday pledged $100 million over the next
five years to help Newark's struggling schools, which are in such sad shape
that they were taken over by the state in the 1990s.
It was the 26-year-old
Internet tycoon's first major charitable contribution.
Zuckerberg made the
announcement on Oprah Winfrey's show, where he was joined by Newark Mayor Cory
Booker, a Democrat, and New Jersey Republican Gov. Chris Christie.
Tech companies settle DOJ
hiring inquiry
WASHINGTON (AP) -- The
Justice Department has reached an agreement with six major Silicon Valley
companies to settle allegations that they colluded to hold down payroll
expenses by agreeing not to poach employees from each other.
The settlement, filed in
the U.S. District Court for the District of Columbia late Friday, names Google
Inc., Apple Inc., Intel Corp., Adobe Systems Inc., Intuit Inc. and Walt Disney
Corp.'s Pixar Animation Studios.
The Justice Department was
investigating whether the companies pledged not to use "cold calls"
to recruit business partners' employees, as part of their partnership
agreements. The government was concerned that these promises amounted to a form
of price-fixing collusion to avoid bidding wars for employees with specialized
skills.
Petrobras raises $70B in
offer, world's largest
SAO PAULO (AP) -- The
exploration and production of Brazil's massive offshore oil reserves is the
driving force behind the globe's biggest-ever share offering.
Petroleo Brasileiro SA, or
Petrobras, the South American nation's state-run energy company, raised $70
billion Thursday through the sale of more than 4 billion common and preferred
shares in Brazil and the U.S. Investors took the opportunity to invest in one
of the world's fastest-growing regions for energy production.
The money will fund
Petrobras' ambitious $224 billion, five-year plan to develop offshore fields
Petrobras discovered in the last three years that hold more than 50 billion
barrels of recoverable oil.
Fed boss wants closer look
at speculative buying
WASHINGTON (AP) -- Fed
policymakers must better understand speculative buying in financial markets to
help prevent another financial crisis, Federal Reserve Chairman Ben Bernanke
said Friday.
Frenzied buying fed a
housing bubble that burst, plunging the economy into a recession in 2007, the
worst downturn since the 1930s. While many lessons were learned from the
crisis, Bernanke, in prepared remarks, said additional research is needed to
explain when and why bubbles start.
That -- along with a better
understanding of how bursting bubbles affect consumers, businesses and
investors -- would help Fed policymakers as they seek to prevent another
financial crisis from happening, he added.
Citigroup gives pay hikes
to top execs in stock
NEW YORK (AP) -- Several
top executives at Citigroup Inc. are getting salary raises in stock, which
could lead to multimillion dollar increases in total compensation. CEO Vikram
Pandit will still get just $1 in pay this year but is in line for a raise next
year.
Citigroup, which is still
partly owned by taxpayers, disclosed the pay changes in a press release and
regulatory filing Friday. The bank said it will again use stock to pay
significant portions of the salary for its top 25 executives.
NBC Universal CEO to leave
when Comcast takes over
NEW YORK (AP) -- NBC
Universal chief Jeff Zucker, who rose from a youthful producer at the
"Today" show to run the multifaceted media business, said he would
step down after cable provider Comcast takes control of the company later this
year.
Zucker, the company's CEO,
told employees of his planned departure in an e-mail he sent Friday, a day
after he set terms of his exit deal.
The possible
change-in-command had been looming since last December when Comcast Corp.
agreed to buy a 51 percent stake in NBC Universal from General Electric Co.
That deal still hasn't cleared regulatory hurdles, but that is expected around
the end of the year.
BP works on own estimate
for amount of spilled oil
NEW ORLEANS (AP) -- Oil
giant BP is working behind the scenes to formulate its own estimate for how
much crude spewed from its well in the Gulf of Mexico, as it prepares for a
potential legal fight with the U.S. government over fines.
The company has carefully
avoided accepting the government's estimate that 206 million gallons of oil was
released by the well after the April 20 explosion aboard an offshore drilling
rig.
BP also has been
preoccupied by the effort to kill the well. A spokesman tells The Associated
Press now the company is reviewing data and will develop its own estimate.
No timetable has been given
for reaching a conclusion.
By The Associated Press
The Dow Jones industrial
average rose 197.84, or 1.9 percent, to close at 10,860.26. The Dow has risen
8.4 percent in September, but is only up 4.1 percent for the year and is still
3.1 percent below its 2010 high reached on April 26.
The Standard & Poor's
500 index rose 23.84, or 2.1 percent, to 1,148.67, ending a three-day losing
streak. The Nasdaq composite index rose 54.14, or 2.3 percent, to 2,381.22. The
technology-focused index has been the best performer during this month's rally,
jumping 12.6 percent.
Benchmark oil for November
delivery rose $1.31 to settle at $76.49 a barrel on the New York Mercantile
Exchange.
In other Nymex trading,
heating oil rose 1.61 cents to settle at $2.1306 a gallon, gasoline added 2.97
cents to settle at $1.9471 a gallon and natural gas lost 13.8 cents to settle
at $3.881 per 1,000 cubic feet.
In London, Brent crude rose
76 cents to settle at $78.87 a barrel on the ICE Futures exchange.