Trade,
housing data more stable, but still weak
WASHINGTON (AP) -- Despite weak
performances in three areas -- trade, home sales and job openings -- the U.S.
economy appears closer to stabilizing, though at low levels, economists said.
The Commerce Department said the trade
deficit widened to $27.6 billion in March, from February's revised $26.1
billion gap, which had been the smallest since November 1999.
Through the first three months of this
year, the trade deficit ran at an annual rate of $359.7 billion, far below last
year's $681.1 billion. Economists expect the deficit will remain low this year
as the U.S. recession crimps demand for foreign goods.
Median home prices fall in 88 percent of
cities
WASHINGTON (AP) -- Home prices fell in
nearly nine out of every 10 U.S. cities in the first quarter of this year as
first-time buyers looking for bargains dominated the market.
While sales rose in six states among the
hardest hit by the housing slump, analysts said the nascent signs of recovery
in the market could be short-lived if employers continue to lay off workers in
bulk.
The National Association of Realtors said
Tuesday that median sales prices of existing homes declined in 134 out of 152
metropolitan areas compared with the same period a year ago. Prices rose in the
other 18 cities.
Investors hunt defensive stocks as rally
stalls
NEW YORK (AP) -- Investors are finding it
hard to extend Wall Street's two-month rally.
Stocks ended mixed but well off their
lows Tuesday as early concerns about a barrage of stock offerings eased and as
rising oil prices lifted energy stocks. The Dow Jones industrials rose 50
points to 8,469.11, while broader indicators fell.
Investors shifted into defensive corners
of the market, driving up shares of drugmakers like Pfizer Inc. and food and
drink producers like Coca-Cola Inc., which tend to hold up better in economic
downturns.
AP Source: Chrysler to cut 800 dealers on
Thursday
DETROIT (AP) -- A Chrysler dealer says
the automaker will tell at least 800 of its 3,200 dealers on Thursday that they
have been fired.
The dealer listened to a conference call
Tuesday held by lawyers who want to represent the dealers whose franchise
agreements will be rejected.
The dealer did not want to be identified
because the call was confidential. But he says a lawyer from the firm Squire
Sanders out of Cincinnati told dealers that Chrysler will ask a bankruptcy
judge to reject the franchises.
Chrysler, which has received $4 billion
in government loans, has filed for Chapter 11 bankruptcy protection in New
York.
Social Security and Medicare finances
worsen
WASHINGTON (AP) -- The financial health
of Social Security and Medicare, the government's two biggest benefit programs,
have worsened because of the severe recession, and Medicare is now paying out
more than it receives.
Trustees of the programs said Tuesday
that Social Security will start paying out more in benefits than it collects in
taxes in 2016, one year sooner than projected last year, and the giant trust
fund will be depleted by 2037, four years sooner.
Medicare is in even worse shape. The
trustees said the program for hospital expenses will pay out more in benefits
than it collects this year and will be insolvent by 2017, two years earlier
than the date projected in last year's report.
Alpha Natural buying Foundation Coal for
$1.4B
CHARLESTON, W.Va. (AP) -- Alpha Natural
Resources said Tuesday it plans to buy rival Foundation Coal for about $1.4
billion in an all-stock deal that would create the nation's third-largest coal
producer.
Foundation Coal shares jumped nearly 21
percent.
Talk of another wave of consolidation in
the coal industry has been growing louder in recent weeks and on Tuesday, Alpha
Chief Executive Mike Quillen said the bid for Foundation reflected that need.
Gasoline nears $2.25, crude briefly above
$60
COLUMBUS, Ohio (AP) -- Retail gasoline
prices rose again overnight and are now up nearly 40 percent from the start of
the year, while the price for crude on Tuesday topped $60 a barrel for the
first time since early November.
Just a week ago, drivers nationally paid about
17 cents less for a gallon of gas on average.
Crude wavered after hitting $60.08 early
Tuesday, but still closed up 35 cents at $58.85 a barrel on the New York
Mercantile Exchange. That's more than 80 percent above prices in December when
crude was bottoming out.
White House memo challenges EPA finding
on warming
WASHINGTON (AP) -- An Environmental
Protection Agency proposal that could lead to regulating the gases blamed for
global warming will prove costly for factories, small businesses and other institutions,
according to a White House document.
The nine-page memo is a compilation of
opinions made by a dozen federal agencies and departments during an internal
review before the EPA issued a finding in April that greenhouse gases pose
dangers to public health and welfare.
That finding could set in motion for the
first time the regulation of six heat-trapping gases from cars and trucks,
factories and other sources under the Clean Air Act.
Ford shares sink on share offering
NEW YORK (AP) -- Ford Motor Co. shares
dropped more than 17 percent Tuesday, a day after disclosing a public offering
of 300 million shares of common stock that will help it fund its health care
trust for retired autoworkers and their families.
Ford, the only major U.S. automaker that has
not accepted government aid, said late Monday it will use the proceeds of the
offering for "general corporate purposes" including funding its
Voluntary Employee Beneficiary Association, or VEBA, with cash instead of
stock.
Dearborn, Mich.-based Ford owes $13.1
billion to its VEBA by 2022, of which $6.5 billion can be paid in stock, cash
or a combination of both. On Dec. 31, the company has a large payment due, $1.2
billion in cash and $610 million in either stock or cash.
Senators weigh tax hikes to pay for
health care
WASHINGTON (AP) -- Senators are
considering limiting -- but not eliminating -- the tax-free status of
employer-provided health benefits to help pay for President Barack Obama's plan
to provide coverage to 50 million uninsured Americans.
Finance Committee Chairman Max Baucus,
D-Mont., said Tuesday that there are no easy options. Senators began grappling
with how to finance guaranteed coverage, a cornerstone of Obama's plan to
overhaul the health care system. Independent experts put the costs at about
$1.5 trillion over 10 years.
By The Associated Press
The Dow rose 50.34, or 0.6 percent, to
8,469.11 after falling 155 on Monday. The S&P 500 index slipped 0.89, or
0.1 percent, to 908.35 and the Nasdaq composite index fell 15.32, or 0.9
percent, to 1,715.92.
Benchmark crude wavered after hitting
$60.08 early Tuesday, but still closed up 35 cents at $58.85 a barrel on the
New York Mercantile Exchange.
In other Nymex trading, gasoline for June
delivery fell 1.3 cents to $1.6672 a gallon and heating oil dipped less than a
penny to $1.51 a gallon. Natural gas for June delivery rose 14.7 cents to
settle at $4.449 per 1,000 cubic feet.
In London, Brent prices rose 46 cents to
settle at $58.11 a barrel on the ICE Futures exchange.