On Thursday December 23, 2010, 6:00 pm EST
Economy brightens as
consumers spend, layoffs slow
WASHINGTON (AP) -- Economic
reports suggest employers are laying off fewer workers, businesses are ordering
more computers and appliances, and consumers are spending with more confidence.
Combined, the data confirm the economy is improving, and further job gains are
expected in 2011.
The economy's outlook is
brightening even though hiring has yet to strengthen enough to reduce an
unemployment rate near 10 percent.
The number of people
applying for unemployment benefits fell last week to a seasonally adjusted
420,000, the Labor Department said Thursday. That's the second-lowest level
since July 2008.
Mortgage rates edge down
after 5 weeks of gains
NEW YORK (AP) -- Rates on
fixed mortgages dipped after rising for five weeks in a row.
Still, they remain more
than a half-point higher than last month and are at the highest level since
late spring.
Freddie Mac said Thursday
the average rate on a 30-year fixed mortgage slipped to 4.81 percent from 4.83
percent in the previous week. Last month, the rate reached a 40-year low of
4.17 percent, but has since been edging higher.
The average rate on the
15-year loan, a popular refinance option, also fell to 4.15 percent from 4.17
percent. It hit 3.57 percent in November, the lowest level on records starting
in 1991.
Rates had been rising since
early November as investors shifted money out of Treasurys and into stocks on
expectations that the recent tax-cut plan will boost economic growth and
potentially increase inflation. The sell-off comes even as the Federal Reserve
buys up $600 billion in bonds to try to lower interest rates.
Jo-Ann Stores being taken
private for $1.6 billion
NEW YORK (AP) -- Fabric and
craft store chain Jo-Ann Stores Inc. is being taken private by investment firm
Leonard Green & Partners LP for about $1.6 billion, the latest in a series
of billion-dollar retail buyouts.
The deal is the most recent
in a flurry of retail buyouts that have occurred in the past three months. Last
month preppy fashion retailer J. Crew Group Inc. agreed to be purchased for $3
billion in a deal that also involves Leonard Green & Partners, along with
private equity firm TPG Capital.
And in October Gymboree
Corp. agreed to be acquired by Bain Capital in a $1.8 billion deal that closed
in November.
Private equity buyouts such
as these are on the rise after a lull during the recession. Industry experts
believe many of the recent deals were for companies that investment firms feel
are stable and safe, making them attractive. But they're also a bet that
consumer spending, which has shown signs of life, will continue to rebound.
Obama to re-nominate Nobel
Prize winner to Fed
WASHINGTON (AP) --
President Barack Obama will resubmit the failed nomination of a Nobel
Prize-winning economist to the Federal Reserve, even though he faces even
stronger opposition from the next Congress.
The nomination of Peter
Diamond fizzled when the Senate adjourned Wednesday without acting on it. But
the White House said Thursday that the president will press ahead on the
nomination.
Diamond, a professor at the
Massachusetts Institute of Technology, is an authority on Social Security,
pensions and taxation. He shared the Nobel Prize in economics that was awarded
in October. But Senate Republicans have opposed his nomination, questioning his
practical experience and research.
Portugal's debt rating
downgraded by Fitch
LONDON (AP) -- Portugal had
its credit rating downgraded Thursday by the Fitch Ratings agency amid mounting
concerns over the country's ability to raise money in the markets to finance
its hefty borrowings.
Fitch said it was reducing
its rating on the country's debt by one notch to A+ from AA- and warned that
further downgrades may be in the offing by maintaining its negative outlook.
GM recalls almost 100,000
vehicles due to 2 issues
NEW YORK (AP) -- General
Motors Co. is recalling almost 100,000 vehicles to fix two problems that could
cause the rear axle to lock and the passenger-side airbag not to work.
GM says in postings with
the National Highway Traffic Safety Administration that the airbag recall
affects almost 96,000 2005 to 2007 model year versions of the Cadillac CTS.
The axle recall affects
almost 1,300 2011 model year versions of the Cadillac Escalade, Chevrolet
Avalanche 1500 and Silverado 1500, as well as the GMC Sierra 1500.
Hungary's debt rating
downgraded by Fitch
LONDON (AP) -- Fitch
Ratings agency downgraded Hungary's debt to one notch above junk status, citing
budget plans that it warned are ill-considered but that the country's lawmakers
approved soon after on Thursday.
Fitch said it was concerned
about the government's economic strategy even though it has pledged to get the
budget deficit below 3 percent of national income next year. The agency also
said it was concerned that a heavy debt load makes the country particularly
vulnerable to global economic shocks.
IRS says tax changes will
cause some filing delays
WASHINGTON (AP) -- Some
taxpayers will be unable to file returns until mid-to-late February because of
recent tax breaks approved by Congress in its lame-duck session, the IRS said
Thursday.
Congress approved tax
breaks for higher education tuition, state and local sales taxes and
out-of-pocket expenses for teachers in kindergarten through high school.
The IRS will need the extra
time to reprogram its computers, but the delays will be minimal for taxpayers
who itemize deductions and normally have to wait for financial documents.
Christmas Eve work shutdown
to spell mobbed malls
NEW YORK (AP) -- It's Black
Friday, The Sequel. Stores are rolling out deals and expect to be swimming in
shoppers on Christmas Eve as stragglers take advantage of a day off work. For
retailers, the last-minute rush caps the best year since 2007, and possibly
ever.
With Christmas falling on a
Saturday this year, Friday is a holiday for most U.S. workers. That lets
shoppers hit the stores first thing in the morning.
By The Associated Press
The Dow Jones industrial
average rose 14 points, or 0.1 percent, to close at 11,573.49. The broader
Standard & Poor's 500 index fell 2.07, or 0.2 percent, to 1,256.77. The
Nasdaq composite index fell 5.88, or 0.2 percent, to 2,665.60.
All three indexes ended the
shortened trading week higher. The Dow rose 0.7 percent. The S&P 500 rose 1
percent, and the Nasdaq 0.8 percent.
Benchmark crude rose $1.03
to settle at $91.51 on the New York Mercantile Exchange.
While oil and gasoline
prices are climbing, the price of one of the main heating sources in the nation
-- natural gas -- is falling. It's down about 11 percent in the past two weeks.
On Thursday natural gas lost 6.9 cents to settle at $4.083 per 1,000 cubic feet
on the Nymex.
In other Nymex trading,
heating oil rose 1.23 cents to settle at $2.5408 per gallon and gasoline gained
1.81 cents to settle at $2.4426 per gallon.
In London, Brent crude rose
60 cents to settle at $94.25 on the ICE Futures exchange.