AP
Business Highlights
Tuesday February 3, 6:33 pm ET

Chrysler sales plunge 55 pct; GM, Toyota also down

DETROIT (AP) -- Chrysler's U.S. vehicle sales plunged 55 percent in January, while General Motors' tumbled 49 percent and Ford's dropped 40 percent, starting 2009 at an abysmal pace for the whole auto industry as lower sales to fleet buyers like rental car companies weighed down the results.

Toyota's sales dove 32 percent for the month, Nissan's dropped 30 percent and Honda's fell 28 percent, putting the overall industry on track for its fourth straight month in which U.S. sales plunged 30 percent or more.

But Subaru bucked the trend of declines for a second month in a row, posting an 8 percent sales increase, and Hyundai said its sales jumped 14 percent.

Pending home sales post increase of 6.3 pct

WASHINGTON (AP) -- An index that tracks signed contracts to purchase existing homes rebounded in December, as buyers snapped up properties at deep discounts, especially in the South and Midwest.

It was the second positive sign in the past two weeks for the troubled U.S. housing market, and may indicate that a bottom is forming -- at least for home sales. Analysts, however, caution that prices are likely to keep falling through 2009.

The National Association of Realtors said Tuesday its seasonally adjusted index of pending sales for previously owned homes for December rose 6.3 percent to 87.7 from an upwardly revised November reading of 82.5, which was lowest month on record. That's better than the 82.3 reading economists expected, according to a survey by Thomson Reuters.

Motorola's woes pile up in $3.6B loss; dividend suspended

NEW YORK (AP) -- North America's largest maker of telecommunications equipment posted a massive fourth-quarter loss as it recorded charges to reflect the shrinking value of its cell phone business. It also suspended its dividend, said its chief financial officer had left and gave a disappointing forecast for the current quarter.

Its stock closed down 11 percent.

Motorola Inc. lost $3.6 billion, or $1.57 per share, in the fourth quarter.

Stocks jump following rebound in home sales

NEW YORK (AP) -- Some heartening news on home sales and earnings Tuesday has let Wall Street set aside a little of its angst.

Major stock indexes jumped more than 1 percent Tuesday, and the Dow Jones industrials rose more than 140 points to snap a three-day slide as some of the day's data turned out to be more upbeat than expected. Still, analysts cautioned that the economy will keep showing fresh bruises in the coming months and that stock trading will remain volatile.

The National Association of Realtors said buyers stepped in to snap up properties at steep discounts in December. Its seasonally adjusted index of pending sales for preowned homes rose 6.3 percent in the final month of the year from revised figures in November.

Wall Street welcomed the news; investors are looking for any signs that the housing industry slide is slowing.

Obama names Gregg commerce secretary

WASHINGTON (AP) -- In the midst of promoting his $800 billion-plus economic proposal, President Barack Obama chose for his new commerce secretary a Republican senator with such a reputation for fiscal discipline that he once voted to shut down the department.

If confirmed by the Senate, Judd Gregg will take over a sprawling agency charged with everything from creating jobs and regulating trademarks to conducting the 2010 census and issuing weather forecasts.

Obama, however, indicated that Gregg's top priority will be his involvement in an administration team tasked with pulling the country out of recession.

Layoffs spike as recession rips through US

WASHINGTON (AP) -- Layoffs are spiking as the recession rips through the country, with retailers, banks, factories and others cutting costs ever deeper this week. It's inflicting a painful toll on workers, and there's little relief in sight.

The latest round of pink slips and cost-cutting measures came Tuesday on the heels of tens of thousands of layoffs ordered by a slew of companies last week alone.

PNC Financial Services Group said it plans to cut 5,800 jobs. Airplane maker Hawker Beechcraft Corp. said 2,300 employees will lose their jobs before the end of the year and warned more layoffs may be coming. Liz Claiborne Inc., will eliminate 725 jobs, or 8 percent of its work force, one day after Macy's Inc. said it was axing 7,000 jobs, or 4 percent of its work force. King Pharmaceuticals Inc., will get rid of 520 jobs.

Wells Fargo reconsiders posh Vegas casino retreat

WASHINGTON (AP) -- Bailed-out bank Wells Fargo says it's reconsidering whether to hold a corporate junket to Las Vegas amid criticism from Capitol Hill.

The company had planned a posh outing for its top mortgage writers to kick off this week at the Wynn Las Vegas. The conference is a Wells Fargo tradition. Previous years have included all-expense-paid helicopter rides, wine tasting, horseback riding in Puerto Rico and a private Jimmy Buffett concert in the Bahamas for more than 1,000 employees and guests.

After The Associated Press reported that this year's event was about to kick off despite the company's $25 billion bailout, the company defended its decision. But after swift outcry from Capitol Hill, a company spokesman says it's reconsidering its plan.

Cutbacks in consumer spending hit UPS' bottom line

ATLANTA (AP) -- The battered U.S. economy took a bite out of UPS' bottom line as consumers spent less and sent fewer packages in the last three months of 2008. The company Tuesday posted fourth-quarter sales and volume declines and said it will freeze management salaries and suspend 401(k) matches for employees to help UPS weather a difficult 2009.

UPS has said previously it would make network modifications, lower capital expenditures and reduce staffing levels. No update was provided on any job cuts that may be in the offing, though Chief Executive Scott Davis said all aspects of the business would be analyzed to see where the company could save money or be more efficient.

Dow Chemical posts $1.55B 4Q loss, sees rough 2009

GRAND RAPIDS, Mich. (AP) -- Dow Chemical Co. reported a $1.55 billion fourth-quarter loss Tuesday as a deteriorating global economy led to a 23 percent drop in sales and huge job cuts.

The loss was larger than expected and revenue came in below Wall Street expectations.

Dow slashed operating rates to 64 percent in the fourth quarter with demand for its products evaporating. Diminished production led to operating rates not seen in more than 25 years, according to the company.

The nation's largest chemical maker said its loss amounted to $1.68 per share in the three months ended Dec. 31. It had earned $472 million, or 49 cents per share, during the last quarter of 2007.

Disney profits drop 32 percent; shares slide

LOS ANGELES (AP) -- The Walt Disney Co. missed analyst targets Tuesday, as it reported a 32 percent decline in quarterly profits.

Chief Executive Robert Iger said the recession had hurt all of Disney's businesses in the three months to Dec. 27, from its theme parks to its broadcast networks.

Net income fell to $845 million, or 45 cents per share. In the same period a year earlier Disney earned $1.25 billion, or 63 cents per share.

By The Associated Press

The Dow Jones industrial average rose 141.53, or 1.78 percent, to 8,078.36.

Broader stock indicators also rose. The Standard & Poor's 500 index rose 13.07, or 1.58 percent, to 838.51, and the Nasdaq composite index rose 21.87, or 1.46 percent, to 1,516.30.

Light, sweet crude for March delivery rose 70 cents to settle at $40.78 a barrel on the New York Mercantile Exchange.

In other Nymex trading, gasoline futures rose 1.78 cents to settle at $1.1670 a gallon, while heating oil fell 1.7 cents to settle at $1.3254 a gallon. Natural gas for February delivery fell 4.4 cents to settle at $4.513 per 1,000 cubic feet.

In London, the March Brent contract rose 26 cents to settle at $44.08 on the ICE Futures exchange.