AP
Business Highlights
Monday December 22, 7:07 pm ET

Toyota projects first loss in 70 years

NAGOYA, Japan (AP) -- Toyota Motor Corp. said Monday it will report the first operating loss in 70 years, acknowledging that after a decade of rapid growth it can no longer escape the slowdown plaguing the global auto industry. The Japanese auto giant also lowered its global vehicle sales forecast for the second time this year and said it was putting ambitious expansion plans on hold, in large part because of a precipitous drop in demand in the key U.S. market.

Walgreen 1Q profit falls 10 percent on store costs

NEW YORK (AP) -- Drugstore operator Walgreen Co. said Monday its profit fell 10 percent in its fiscal first quarter, short of Wall Street expectations, because of costs opening more than 200 new stores.

The company said it plans to slow the opening of new stores to save $500 million in response to the recession.

The Deerfield, Ill., company said earned $408 million, or 41 cents per share, in the three months ended Nov. 30. That total fell short of analyst expectations, and compares with $456 million, or 46 cents per share, a year ago. Revenue grew 7 percent to $14.95 billion.

Stocks fall in light trade as Toyota cuts outlook

NEW YORK (AP) -- Wall Street began a holiday-shortened week with a moderate pullback Monday as investors recoiled at bleak news from Toyota Motor Corp. and drugstore operator Walgreen Co.

The two companies -- both viewed as better-positioned than many of their peers -- provided more evidence that even stronger companies are struggling as consumers cut back their spending.

The Dow fell 59.34, or 0.69 percent, to 8,519.77, after briefly moving into positive territory early in the session, tumbling, and then recovering some of its losses. Monday's retreat was the fourth straight daily loss for the Dow.

Caterpillar scales back executive pay in 2009

By The Associated Press

Caterpillar Inc., the world's largest maker of mining and construction equipment, said Monday it will cut executive compensation by up to 50 percent next year due to slower demand amid the global economic downturn.

The Peoria, Ill., company also said it was offering voluntary buyouts to about 25,000 U.S.-based managers and support employees and had instituted a global hiring freeze. Caterpillar, which employs about 112,000 people worldwide, has expanded dramatically in recent years, driven partly by demand from infrastructure projects in developing countries.

AIG sells Hartford Steam Boiler for $742 million

CHARLOTTE, N.C. (AP) -- American International Group Inc. said Monday that it will sell its Hartford Steam Boiler unit to German reinsurer Munich Re for $742 million as the embattled New York-based insurer divests itself of units to pay back a U.S. government bailout loan.

The purchase price is considered well below HSB Group Inc.'s value -- estimated at between $1 billion and $2 billion by the Financial Times.

Textron lowers 4Q outlook, to cut about 2,200 jobs

NEW YORK (AP) -- Textron says it plans to cut about 2,200 jobs as it exits nearly all of its commercial finance business, in an effort to improve its liquidity position in the tightening credit markets.

The defense contractor also is lowering its fourth-quarter earnings outlook.

The Providence, R.I.-based company says it will record a $250 million to $300 million charge in the fourth quarter for adjustments to the value of assets to be sold.

China cuts interest rates in new growth effort

BEIJING (AP) -- China cut interest rates Monday for the fifth time in four months in a new effort to revive economic growth amid government anxiety about spreading job losses and worker protests.

The benchmark one-year lending rate will fall by 0.27 percentage point to 2.25 percent, effective Tuesday, the central bank said. That came just four weeks after China's biggest rate cut in 11 years and left the benchmark rate at its lowest level since February 2004.

China seeks WTO probe of US taxes on Chinese goods

GENEVA (AP) -- China has asked the World Trade Organization to investigate whether the United States is illegally taxing Chinese goods such as steel pipes and off-road tires.

It's the first time Beijing has ever sought a WTO panel in a trade dispute.

Washington delayed the panel's establishment at a meeting of the WTO's dispute body on Monday, but an investigation will likely be launched early next year.

Oil prices tumble below $40 on dour economic news

Oil prices tumbled below $40 a barrel Monday as reports from manufacturers like Toyota and Caterpillar pointed to a worsening global economic climate and serious deterioration in energy demand.

Light, sweet crude for February delivery fell $2.45, or nearly 6 percent, to settle at $39.91 a barrel on the New York Mercantile Exchange. Crude prices have tumbled 70 percent since peaking above $147 in July.

New TNK-BP board elected

MOSCOW (AP) -- Anglo-Russian oil joint venture TNK-BP elected a completely new board at an extraordinary shareholders' meeting Monday, bringing to a close one of the most bitter corporate disputes in Russia this year.

The board includes four representatives from each Russian and British shareholders and one independent director

By The Associated Press

The Dow fell 59.34, or 0.69 percent, to 8,519.77.

Broader stock indicators also finished lower. The Standard & Poor's 500 index fell 16.25, or 1.83 percent, to 871.63, and the Nasdaq composite index fell 31.97, or 2.04 percent, to 1,532.35.

The Russell 2000 index of smaller companies fell 11.19, or 2.30 percent, to 475.07.

Light, sweet crude for February delivery fell $2.45, or nearly 6 percent, to settle at $39.91 a barrel on the New York Mercantile Exchange.

Natural gas for January delivery fell 4 cents to settle at $5.294 per 1,000 cubic feet.

In other Nymex trading, gasoline futures slipped 8.3 cents to settle at 88.6 cents a gallon and heating oil fell 5 cents to settle at $1.3415 a gallon.

In London, February Brent crude tumbled $2.55 to settle at $41.45 a barrel on the ICE Futures exchange.