AP
Business Highlights
Wednesday November 12, 6:22 pm ET

Paulson says troubled assets will not be purchased

WASHINGTON (AP) -- The government has abandoned the original centerpiece of its $700 billion rescue effort for the financial system and will not use the money to purchase troubled bank assets.

Treasury Secretary Henry Paulson said Wednesday that the administration will continue to use $250 billion of the program to purchase stock in banks as a way to bolster their balance sheets and encourage them to resume more normal lending. He also announced that the administration was looking at a major expansion of the program into the markets that provide support for credit card debt, auto loans and student loans.

Stocks plunge for third straight session

NEW YORK (AP) -- A disheartened Wall Street fell for the third straight session Wednesday as investors absorbed another series of dismal corporate reports and news that the government won't buy banks' soured mortgage assets after all. The Dow Jones industrials dropped more than 410 points to 8,282.66, and all the major indexes lost more than 4 percent.

The stock market has lost about $1 trillion over the past three days, according to the Dow Jones Wilshire 5000 index, which reflects the value of nearly all U.S. stocks.

Stores see 'seismic' shift as consumers clamp down

NEW YORK (AP) -- Americans have slammed their wallets shut since the financial meltdown, and the future is looking downright scary for stores across the country and the whole U.S. economy.

On Wednesday, Best Buy Co. slashed its earnings forecast and said the changes in consumer behavior have been nothing less than "seismic," creating "the most difficult climate" the company had seen in its 42-year history. And Macy's Inc., which turned a profit in the third quarter of last year, swung to a loss this time, warned that the upcoming holiday season would be "a nail-biter" and slashed its budget for 2009 capital expenditures by almost half.

Democrats urge federal stake in big auto companies

WASHINGTON (AP) -- Congressional Democrats are pushing legislation to send $25 billion in emergency loans to the beleaguered auto industry in exchange for a government ownership stake in the Big Three car companies.

House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev., hope for quick passage of the auto bailout during a postelection session that begins Monday.

Intel warns of sharply lower revenue

SANTA CLARA, Calif. (AP) -- Intel Corp. sharply cut its fourth-quarter sales projection Wednesday, indicating just how severely technology spending is being slammed to a halt in the economic turmoil.

The chip maker now expects revenue to come in at about $9 billion, down from a previous estimate of $10.1 billion to $10.9 billion, as personal computer makers look to cut back on their parts inventories. Analysts polled by Thomson Reuters expected $10.3 billion, on average.

Morgan Stanley unveils job cuts

NEW YORK (AP) -- Morgan Stanley on Wednesday outlined plans to cut 10 percent of staff in its biggest business, which covers everything from investment banking to stock trading.

The nation's No. 2 securities firm, which converted into a bank holding company in September, plans to scale back its most capital-intensive businesses before the end of the year. The layoffs inside the institutional securities group follow a 10 percent cut made earlier this year to the same group.

Oil near $56 as global markets stumble

SIOUX FALLS, S.D. (AP) -- Oil prices plunged Wednesday as awful numbers from retailers and a dismal outlook from automakers lent yet more evidence that the U.S. and the rest of the globe will slash its energy use.

The Energy Department said it expects U.S. consumption of petroleum to drop more severely than any time since 1980 next year, with gasoline use dropping by another 3 percent.

Light, sweet crude for December delivery fell nearly 6 percent, or $3.50 to settle $56.16 a barrel on the New York Mercantile Exchange

Exec with Swiss bank UBS indicted in tax probe

MIAMI (AP) -- A senior executive with Swiss banking giant UBS AG was charged in a federal indictment unsealed Wednesday with conspiring to hide $20 billion in assets from the Internal Revenue Service using secret overseas accounts for thousands of wealthy customers.

Raoul Weil, chief executive officer of a UBS division handling cross-border business and private banking, is charged with one count of conspiring to defraud the U.S. through income tax evasion. But the indictment also says other UBS executives at high levels of the company took part in the conspiracy.

Anheuser-Busch shareholders approve sale to InBev

SECAUCUS, N.J. (AP) -- Shareholders of Anheuser-Busch Cos. Inc. approved the $52 billion sale of the business to Belgium-based InBev SA on Wednesday, a deal that is set to create the world's largest brewer.

The vote was the latest step necessary to form the company that will be known as Anheuser-Busch InBev and combine brands such as Bud Light and Budweiser with Stella Artois and Beck's. The deal, reached in July, is expected to close by the end of the year. It is subject to regulatory approval in the U.S., Britain and China.

Yum Brands says it is cutting several hundred jobs

LOUISVILLE, Ky. (AP) -- Fast-food company Yum Brands Inc. said Wednesday it will eliminate several hundred jobs and shift up to a couple hundred more as part of a restructuring of its sluggish U.S. business.

The restructuring is part of Yum's strategy to sell more company-owned stores to franchisees, spokesman Jonathan Blum said. The operator of KFC, Taco Bell and Pizza Hut said last month its third-quarter U.S. operating profit fell 16 percent, due to surging commodity prices and lagging KFC sales.

By The Associated Press

The Dow shed 411.30, or 4.73 percent, to 8,282.66.

The broader Standard & Poor's 500 index dropped 46.65, or 5.19 percent, to 852.30, and the Nasdaq composite index stumbled 81.69, or 5.17 percent, to 1,499.21.

The Russell 2000 index of smaller companies fell 29.49, or 6.11 percent, to 452.80.

Light, sweet crude for December delivery fell nearly 6 percent, or $3.50 to settle $56.16 a barrel on the New York Mercantile Exchange.

In other Nymex trading, heating oil futures slipped 9.3 cents to settle at $1.835 a gallon, while gasoline fell more than 4 percent, or 5.7 cents, to $1.248 a gallon. Natural gas for December delivery tumbled 30 cents to $6.405 per 1,000 cubic feet.

In London, December Brent crude plunged $3.34 to settle at $52.37 on the ICE Futures