AP
Business
Highlights
Tuesday
October 28, 6:35 pm ET
There didn't appear to be any one catalyst for the surge that saw
the Dow nearly double its gain in the last hour of trading. Many analysts said
investors were grabbing up stocks in the belief that Wall Street had fallen too
far in recent sessions; the Dow had dropped 500 points in two days. Some said
buying early in the day came from anticipation of an interest rate cut
Wednesday by the Federal Reserve, and the market just followed its recent
pattern of building on its gains or losses in the last minutes of the session.
White House to banks: Start lending now
WASHINGTON (AP) -- An impatient White House prodded banks and
other financial companies Tuesday to quit hoarding billions of dollars flowing
into their vaults from Washington and start making more loans.
Hoping to thaw the credit freeze that has chilled the economy,
the Bush administration sent banks an unmistakable message to put aside fears
and open up loan windows for cash-starved businesses and consumers who have
pulled back on spending.
While there are limits to
Consumer confidence plunges to lowest on record
WASHINGTON (AP) -- Layoffs, plunging home prices and tumbling
investments have pushed consumer pessimism to record levels in October, a
private research group said Tuesday. Wall Street surged nearly 900 points,
though, focusing instead on higher global markets amid optimism the Federal
Reserve will ease interest rates further.
The Conference Board said the consumer confidence index fell to
38, down from a revised 61.4 in September and significantly below analysts'
expectations of 52.
That's the lowest level for the index since the Conference Board
began tracking consumer sentiment in 1967, and the third-steepest drop. A year
ago, the index stood at 95.2.
Automakers seek gov't aid beyond
bailout and loans
WASHINGTON (AP) -- Beleaguered U.S. automakers are seeking
federal help beyond the money that Congress has made available for them as part
of a financial industry bailout and a measure to retool their assembly plants
for more fuel-efficient cars, the White House said Tuesday.
White House spokeswoman Dana Perino
said the auto industry has talked to the Bush administration about funding on a
much broader scale than the two programs approved by Congress earlier this
fall.
General Motors Corp. is pursuing about $5 billion to $10 billion
in aid from the government.
The requests have come as General Motors and Chrysler LLC are
discussing a potential merger amid an economic downturn, weak auto sales and
hardships for the companies.
Oil company profits rise, but outlook is cautious
HOUSTON (AP) -- Record crude prices this summer are translating
into huge profits, as BP and Occidental Petroleum showed Tuesday, but some
energy companies are bracing for tougher times, keeping a closer tab on cash
and cutting spending.
Oil producers are coming off a quarter during which crude prices
reached an all-time high of $147.27. But prices have since tumbled more than 50
percent, and the global economic malaise has raised questions about energy
demand at least into 2009.
Despite a 71 percent jump in third-quarter profit, Occidental
Petroleum said Tuesday it likely would not increase capital spending next year
from its current $4.7 billion level. Refiner Valero Energy Corp., which also
reported July-September results Tuesday, said it was scaling back spending by
33 percent this year and cutting its 2009 budget.
Whirlpool to cut 5,000 jobs by end of 2009
GRAND RAPIDS, Mich. (AP) -- Whirlpool Corp. said Tuesday it is
eliminating about 5,000 jobs this year and next, due in large part to the long
downturn in the U.S. housing market.
The nation's largest home appliance maker also reported that its
earnings fell 7 percent during the third quarter on lower global unit volumes
and higher material costs. Whirlpool lowered its earnings outlook for the year and
announced price increases.
Company officials received more sobering news Tuesday upon
learning that consumer confidence had plunged to its lowest level on record.
Whirlpool said the drop in profit reflects significantly higher
material and oil-related costs and lower industry demand.
SEATTLE (AP) -- Boeing Co.'s Machinist union said it will vote on
a tentative four-year labor pact on Saturday, a process that could end an
eight-week strike against the airplane maker.
The strike, now in its 53rd day, has shut Boeing's commercial jet
factories, cut into profits and delayed airplane deliveries.
Boeing spokesman Tim Healy on Tuesday said company and union
officials would meet soon to set a schedule for workers to return to their jobs
if the contract is ratified.
Oil falls below $63 before
DENVER (AP) -- Oil prices fell Tuesday a day before the
government releases its weekly crude inventory report that recently has shown
in stark numbers how much Americans are cutting back on energy costs.
Although oil prices typically decline in the fall, analysts
expect the prices to continue falling, perhaps as low as $50 a barrel, before
they hit bottom.
Oil prices have shadowed the direction of Dow Jones industrial
average for weeks, but that was not the case Tuesday.
Treasury predicts huge government borrowing needs
WASHINGTON (AP) -- The financial rescue
operation will force the federal government to borrow an unprecedented amount
of money as the budget deficit climbs to record heights, a top Treasury
Department official said Tuesday.
Anthony Ryan, Treasury's acting undersecretary for domestic
finance, said the administration back in July was forecasting that the deficit
for the current budget year, which began on Oct. 1, would hit a record $482
billion. He said that forecast did not include all the government's efforts
since then to deal with the worst financial crisis since the 1930s.
Ryan said those borrowing efforts will need to address numerous
government initiatives.
Wal-Mart scales back expansion in tough economy
NEW YORK (AP) -- Wal-Mart Stores Inc. is navigating the global
economic slowdown by scaling back its store growth and capital expenditures
while focusing on remodeling existing locations and creating smaller outposts.
The goal, Chief Financial Officer Tom Schoewe
told analysts on its second day of the company's annual meeting with Wall
Street analysts, is to continue to increase its cash flow to invest in its
business, while delivering returns to shareholders through dividends and share
buybacks.
Wal-Mart, the world's largest retailer, plans to open a total of
212 stores in the U.S. in fiscal 2009, which ends in January, and from 157 to
177 stores in fiscal 2010. That compares with 243 stores opened in the prior
year.
By The Associated Press
The Dow rose 889.35, or 10.88 percent, to 9,065.12. That was its
second-largest point gain, coming after the 936 points the Dow jumped on Oct.
13.
The Dow was up 456 points at 3 p.m., an hour before the close,
and rose as much as 906.31 before edging back.
Broader stock indicators also surged Tuesday. The Standard &
Poor's 500 index rose 91.59, or 10.79 percent, to 940.51, and the Nasdaq composite index rose
143.57, or 9.53 percent, to 1,649.47.
Light, sweet crude for December delivery fell 49 cents to settle
at $62.73 a barrel on the
In other Nymex trading, gasoline
futures fell 2.14 cents to settle at $1.455 a gallon and heating oil slipped to
$1.91 a gallon. Natural gas for November delivery added 6.5 cents to settle at
$6.18 per 1,000 cubic feet.
In