AP Business Highlights

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On Friday May 7, 2010, 6:03 pm EDT

Largest hiring burst in years, but jobless rate up

WASHINGTON (AP) -- The economy added a net 290,000 jobs in April, the biggest monthly total in four years.

The improving jobs picture caused so many more people to pour into the labor force in search of employment that the jobless rate rose from 9.7 percent to 9.9 percent.

The hiring last month of 66,000 temporary government workers to conduct the census added to overall job creation. But private employers, the backbone of the economy, contributed the most: A surprisingly strong 231,000 jobs, the most since March 2006, the Labor Department said Friday.

Stocks falter after wild day, Europe woes linger

NEW YORK (AP) -- Stocks had another volatile day Friday, swinging widely before closing sharply lower.

The Dow Jones industrials closed with a loss of about 140 points, having been down almost 280 earlier. That followed a brief plunge of nearly 1,000 points on Thursday, the biggest one-day drop in the Dow's history. The erratic trading Friday was no surprise -- stocks often fluctuate sharply right after the market suffers a big slide.

Traders were still anxious amid lingering questions about what caused Thursday's sudden drop. Several possibilities were being investigated, but as of late Friday no clear explanation had emerged.

Regulators look into market plunge, weigh changes

WASHINGTON (AP) -- The federal regulators that oversee financial markets say they are investigating the causes of the mass sell-off Thursday that pushed the Dow Jones Industrial average down hundreds of points. They are identifying one possible cause: Conflicting trading rules for different markets.

The Securities and Exchange Commission and the Commodity Futures Trading Commission say they are reviewing data related to Thursday's trading frenzy. They are looking at information from exchanges, self-regulatory groups and market participants. They say they will make any necessary changes to prevent the problem from recurring.

AIG returns to profitability in 1st quarter

NEW YORK (AP) -- AIG, the insurance giant bailed out by the federal government, reported net income of $1.45 billion for the first quarter as its struggling insurance business showed signs of improvement.

The company also said Friday that recovering credit markets and ongoing efforts to streamline its operations contributed to improved performance.

Shares of AIG surged $1.95, or 5.3 percent to $38.70, even as the broader market fell.

Buffett's firm releases details of $3.6B 1Q profit

OMAHA, Neb. (AP) -- Berkshire Hathaway says it benefited from an improving economy and investment gains related to its acquisition of BNSF railroad in the first quarter as it rebounded from last year's loss to deliver $3.6 billion in net income.

Berkshire said Friday it earned $2,272 per Class A share during the quarter. That's after last year's loss of $1.5 billion, or $990 per share, as it wrote down the value of its ConocoPhillips investment.

Europe tries to douse debt crisis

BRUSSELS (AP) -- Amid ruthless financial turmoil, German Chancellor Angela Merkel urged European leaders to sharpen the core rules underpinning the euro to avoid debt crises like the ferocious one which has pushed Greece to the brink of bankruptcy and threatened other fragile euro-zone nations.

Several other leaders, including French President Nicolas Sarkozy, insisted Greece and subsequent market moves targeting other euro-zone nations had left the whole framework of rules managing the euro in crisis and needed to be firmed up, according to officials close to the talks.

Goldman creating committee to review its practices

NEW YORK (AP) -- Goldman Sachs brought its campaign to improve its image directly to investors Friday as Chairman and CEO Lloyd Blankfein said the investment bank will do better at "listening to the concerns of our shareholders."

Blankfein also told the company's annual meeting that Goldman is creating a business standards committee to study its practices as it fights civil fraud charges brought by the Securities and Exchange Commission.

Consumer Reports lifts Lexus "Don't Buy" rating

DETROIT (AP) -- Consumer Reports magazine is lifting a "Don't Buy" recommendation for a Lexus sport utility vehicle that failed an emergency handling test.

The magazine said Friday that the 2010 Lexus GX 460 luxury SUV passed the test after a dealership updated software that runs its electronic stability control system.

Toyota Motor Corp. recalled about 10,000 of the SUVs in the United States in April after the magazine told readers not to buy them. The automaker also stopped selling them.

Consumer borrowing posts unexpected rise in March

WASHINGTON (AP) -- Consumer borrowing posted an unexpected increase in March, only the second gain in the last 14 months. It could be a sign that households are feeling more confident about boosting spending, a key development needed to support a sustained economic recovery.

The Federal Reserve reported Friday that consumer borrowing rose by $1.95 billion in March, better than the $3.85 billion drop that economists had expected.

Consumer credit was also up in January but other than those two gains, it has been falling steadily since February of last year as households have cut back on their borrowing to repair their battered balance sheets.

Judge clears General Growth bankruptcy exit plan

LOS ANGELES (AP) -- Simon Property Group Inc. on Friday withdrew its $6.5 billion bid to acquire rival shopping mall owner General Growth Properties Inc., following a bankruptcy court ruling that Simon said would have made the deal too expensive.

The move ends a monthslong campaign by the nation's largest shopping mall owner to take over its closest competitor. It was an unlikely bidding war for a company that just over a year ago had the dubious honor of being the biggest real estate bankruptcy case in U.S. history.

The plan approved by U.S. Bankruptcy Court Judge Allan Gropper in New York should enable General Growth to emerge from Chapter 11 bankruptcy protection as a standalone company. Under the plan, General Growth would receive $6.5 billion from an investor group led by Canadian property manager Brookfield Asset Management Inc.

By The Associated Press

The Dow Jones industrial average closed down 139.89, or 1.3 percent, at 10,380.43

The Standard & Poor's 500 index fell 17.27, or 1.5 percent, at 1,110.88, while the Nasdaq composite fell 54, or 2.3 percent, to 2,265.64.

Friday's trading left the Dow down 5.7 percent for the week and erased its gains for the year. The S&P fell about 6.4 percent, while the Nasdaq was off 7.9 percent for the week. The S&P and Nasdaq also went into the red for 2010.

A barrel of benchmark crude fell $2 to settle at $75.11 a barrel Friday on the New York Mercantile Exchange. That's the lowest per-barrel price since mid-February. Crude prices have dropped more than $12 a barrel from an 18-month high on Monday.

In other Nymex trading in June contracts on Friday, heating oil fell 3.42 cents to settle at $2.0795 a gallon, and gasoline dropped 3.12 cents to settle at $2.1251 a gallon. Natural gas rose 8.6 cents to settle at $4.015 per 1,000 cubic feet.

In London, Brent crude lost $1.56 to settle at $78.27 on the ICE futures exchange.

 

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