AP
Business Highlights
Thursday October 16, 6:55 pm ET

Stocks shoot higher as volatility continues

NEW YORK (AP) -- Wall Street turned in another stunning finish Thursday and extended its unprecedented streak of volatility -- this time, to the upside -- as investors spent a fractious session again struggling with fears about a recession but giving in to a last-hour wave of buying.

The Dow Jones industrials ended up 400 points, after falling 380 early in the session.

Consumer prices flat in September

WASHINGTON (AP) -- Consumer prices were flat in September as retreating costs for gasoline, clothes and new cars helped to offset rising prices for food, medical care and other things.

The new reading on the Consumer Price Index, the government's most closely watched inflation barometer, came after prices actually dipped by 0.1 percent in August, the Labor Department reported Thursday.

Those two months, however, offered Americans a rare reprieve. Consumer prices have marched upward most of the year, spiking by 1.1 percent in June.

Google 3Q earnings rise 26 pct, top analyst views

SAN FRANCISCO (AP) -- Google Inc. shook off the economic doldrums to deliver a third-quarter profit that topped analysts' expectations, supporting the Internet search leader's theory that its advertising system will prosper even in tough times.

The Mountain View, Calif.-based company said Thursday that it made $1.35 billion, $4.24 per share. The profit rose 26 percent from $1.07 billion, or $3.38 per share, at the same time last year.

Excluding costs for employee stock compensation, Google said it would have made $4.92 per share. That figure surpassed the average estimate of $4.75 per share among analysts polled by Thomson Reuters.

Citigroup posts another loss amid credit woes

NEW YORK (AP) -- Citigroup Inc. suffered its fourth straight quarterly loss and cut another 11,000 jobs, drubbed again by the relentless downturn in housing and turmoil in the financial markets.

The New York-based bank said Thursday it lost $2.8 billion, or 60 cents per share, in the third quarter, compared with a profit of $2.2 billion, or 44 cents per share, a year ago. The deficit for the June-to-September period brings Citi's total losses over the past 12 months to $20.2 billion.

The shortfall for the quarter was narrower than anticipated. Analysts polled by Thomson Reuters expected a loss of 70 cents per share.

But the results were hardly reassuring.

Oil plummets on big jumps in US crude, gas stocks

NEW YORK (AP) -- Oil prices that a few months ago looked like they just would keep on rising fell Thursday to a level less than half the record high of $147.27 they reached this summer. Crude dropped below $70 a barrel, reaching a 14-month low, after the government reported massive increases in U.S. crude and gasoline supplies.

Investors took the news as more evidence that a global credit crisis and a shaky economy are curbing demand for oil.

At the pump, a gallon of regular gasoline shed another 4 cents overnight to a new national average of $3.084.

Social Security checks grow a bit as stocks shrink

WASHINGTON (AP) -- Social Security checks are going up $63 a month for the typical retiree -- the largest increase in more than a quarter century.

The yearly adjustment in Social Security checks is linked to government inflation figures, but advocacy groups for seniors say it's far short of what the typical retiree needs to keep up with rising living costs.

The 5.8 percent increase announced Thursday by the Social Security Administration will go to the 50 million Americans receiving benefits. It is the biggest jump since the 7.4 percent of 1982. The $63 typical monthly increase compares to the $24 advance that retirees saw in this year's benefit checks, an increase of just 2.3 percent and the smallest in four years.

Southwest, Continental report third-quarter losses

DALLAS (AP) -- Southwest Airlines Co. reported its first quarterly loss in 17 years, and Continental also lost money because of high summer fuel costs, but airline executives said Thursday they are more worried now about a looming recession.

The reports told a story of good and bad news -- fuel prices are finally falling, but so is the economy and with it, the ability of people to travel.

IBM 3Q profit jumps 20 pct as hardware sales slump

SAN FRANCISCO (AP) -- IBM Corp.'s third-quarter profit jumped nearly 20 percent, surpassing analyst estimates, as the technology company overcame slumping hardware sales and signed a healthy number of new services contracts.

The Armonk, N.Y.-based company had released partial results for the July-September period last week to try to reassure investors who had been driving down the company's stock price.

The move helped stop a steeper decline, but Wall Street was still waiting for word about how much new business IBM brought in during the period.

In a closely watched indicator, IBM signed $12.7 billion in new services contracts in the quarter, down 4 percent, which still showed it was able to lock in lots of new business despite the tough economic times.

Rates edge lower, but commercial paper drops again

NEW YORK (AP) -- Several key lending rates declined again Thursday, but another weekly drop in the amount of commercial paper in the market showed that the credit markets remain under stress.

The Federal Reserve said the amount of commercial paper outstanding fell for the fifth straight week in the week ended Wednesday, shrinking by $40.3 billion to a seasonally adjusted $1.51 trillion. That's down from $1.81 trillion in late September, and down from the peak of $2.2 trillion reached in the summer of 2007.

The most recent weekly decline is not as large as the tumbles in previous weeks.

FDA will open inspection office in China this year

WASHINGTON (AP) -- The Food and Drug Administration will establish its first office in China before the end of the year as part of a broader plan to assure the safety of imports from the developing world.

FDA Commissioner Andrew von Eschenbach on Thursday laid out a plan to place more than 60 food and drug regulators worldwide over the next year, with a particular focus on India, Latin America and the Middle East.

The staffers will inspect foreign facilities, provide guidance on U.S. quality standards, and eventually train local experts to conduct inspections on behalf of the FDA.

After opening its initial office in Beijing, the FDA expects to post eight U.S. staffers to China next year and open additional outposts in Shanghai and Guangzhou. The government would send 10 employees to India, split between New Delhi and at least one other location yet to be determined.

By The Associated Press

On Thursday, the Dow rose 401.35, or 4.68 percent, to 8,979.26, showing an 816-point swing from its low to its high of the session. The Dow remains up 528 points, or 6.3 percent, for the week.

Broader stock indicators also jumped. The Standard & Poor's 500 index rose 38.59, or 4.25 percent, to 946.43, and the Nasdaq composite index rose 89.38, or 5.49 percent, to 1,717.71.

Light, sweet crude for November delivery dropped $4.69, or 6.2 percent, to settle at $69.85 a barrel on the New York Mercantile Exchange, the lowest settlement prices since Aug. 23, 2007. Earlier prices dipped to $68.57, a level not seen since June 27, 2007.

Crude has now fallen 52.5 percent since surging to a record $147.27 on July 11.

In other Nymex trading, heating oil fell 10.62 cents to settle at $2.1108 a gallon, while gasoline futures lost 16.02 cents to settle at $1.622 a gallon. Natural gas futures fell 7.9 cents to settle at $7.215 per 1,000 cubic feet.

In London, November Brent crude fell $4.48 to settle at $66.32 a barrel on the Ice Futures exchange.