Weak dollar no quick fix for narrowing trade gap
WASHINGTON (AP) -- A weaker
dollar may boost the nation's economy by increasing exports and narrowing the
trade gap -- but that won't happen anytime soon.
Instead, the nation's trade
deficit rose in September by the largest percentage in a decade as U.S. exports
grew for the fifth straight month, but imports rose faster, a government report
showed Friday. That trend is likely to continue until the middle of next year,
economists said.
Rising oil prices and higher
purchases of foreign goods by U.S. companies drove imports higher. So did more
purchases of foreign parts by U.S. manufacturers, which are ramping up
production in the fledgling economic recovery.
Earnings reports push stocks
higher; Dow gains 73
NEW YORK (AP) -- Encouraging
earnings news from major retailers and The Walt Disney Co. drew investors back
into the stock market one day after a big drop.
Upbeat quarterly reports
Friday from Abercrombie & Fitch Co., J.C. Penney Co. and Disney offset
worries about a disappointing consumer confidence report. The Dow Jones
industrial average gained 73 Friday after dropping 94 on Thursday.
The market briefly stumbled
in morning trading after a report found the mood of consumers darkened. The
preliminary Reuters/University of Michigan consumer sentiment index for
November came in at 66.0, down from 70.6 in October. That made investors
nervous that cautious consumers wouldn't step up spending at the holidays.
FDA finds bits of steel,
rubber in Genzyme drugs
WASHINGTON (AP) -- Federal
health regulators have found tiny particles of trash in drugs made by Genzyme,
the second time this year the biotechnology company has been cited for
contamination issues.
The Food and Drug
Administration said Friday that bits of steel, rubber and fiber found in vials
of drugs used to treat rare enzyme disorders could cause serious adverse health
effects for patients.
Despite those problems, the
FDA said the products would remain on the market, because there are few
alternative treatments.
FDA regulators say doctors
should closely inspect vials for particles before injecting them into patients.
Doctors should return the product to Genzyme if they suspect contamination, the
agency said.
Deficit doubles for
government pension insurer
WASHINGTON (AP) -- The
government-chartered company that insures the pensions of one in seven
Americans said Friday that its deficit this year nearly doubled to $22 billion.
That's an improvement over
the Pension Benefit Guaranty Corp.'s midyear record deficit of $33.5 billion,
which spiked as auto makers and other companies faltered and caused the
insurance fund's liabilities to spike.
Yet experts and officials
say the long-term picture is grim. They say that without major changes, such as
higher insurance premiums and less risky investments, the fund eventually will
require a taxpayer bailout.
J.C. Penney reports sharp
drop in 3Q profit
NEW YORK (AP) -- Department
store chain J.C. Penney Co. reported a 78 percent drop in its third-quarter
earnings because of a big expense for its pension plan, and its revenue slipped
from a year earlier.
The moderate-price retailer
upgraded its annual profit and sales outlook for the year because it is selling
more items at full price or on planned promotions, but the outlook for holiday
shopping remains uncertain.
The company expects sales at
stores open at least a year, a key measure of a retailer's health, to fall
between 4 percent and 6 percent in the quarter that includes the holidays, less
than the 10.8 percent drop it suffered in the period in 2008. It expects to
earn 70 cents to 85 cents per share for the period, compared with 95 cents a
year ago, on revenue 3 percent to 5 percent lower than a year ago.
Realtors: Home prices to
rise 4 percent in 2010
SAN DIEGO (AP) -- Home
prices are expected to grow modestly next year and sales will keep rising as
the housing market continues to recover from the worst downturn since the Great
Depression, the National Association of Realtors said Friday.
Home resales are projected
to total 5.7 million next year, up from an estimated 5 million this year.
Prices will climb about 4 percent after a projected decline of 13 percent this
year, according to Lawrence Yun, chief economist for the trade association.
The housing market's rebound
has been aided by an aggressive federal intervention to lower mortgage rates
and bring more buyers into the market. Home resales rose in September to the
highest level in more than two years, something Yun said shows buyers are eager
to get back into the market.
Computer programmers accused
of aiding Madoff scam
NEW YORK (AP) -- Two former
employees for Bernard Madoff programmed an old IBM computer to generate false
records that concealed the crooked financier's massive Ponzi scheme and were
given hush money when they threatened to stop lying, federal prosecutors said
Friday.
Madoff gave orders to pay
the pair "whatever they wanted to keep them happy," a criminal
complaint said.
The complaint relies heavily
on inside information provided by Madoff's chief financial officer, Frank
DiPascali, who is cooperating after pleading guilty in August.
FDA questions safety of
alcoholic energy drinks
WASHINGTON (AP) -- The Food
and Drug Administration is challenging makers of alcohol-infused energy drinks
to prove their beverages are safe, citing complaints that the products can
cause risky behavior and injury.
The FDA issued a letter
Friday to 30 beverage manufacturers, giving them 30 days to provide evidence
that the combination of caffeine and alcohol is safe.
FDA officials stressed they
have not reached a conclusion about the safety of beverages like Joose and
Charge. Instead they are questioning the companies' legal rationale for
marketing the products.
Oil dips to lowest level
since October
NEW YORK (AP) -- Oil slid
Friday to its lowest price in a month as investors started to pay more
attention to a yearlong slump in American energy demand.
For most of the year, oil
prices surged as investors pumped money into crude contracts to protect
themselves from a weakening dollar. Oil was thought of as a safe bet with
demand expected to rise next year.
But as crude prices doubled
from March to October, consumers and businesses continued to use less gasoline
and diesel. Refiners struggled. In parts of the Midwest this week, gasoline was
selling at a cheaper price than the oil used to make it, according to the Oil
Price Information Service.
Ford analyst sees small car
segment growing
DETROIT (AP) -- Small car
sales will continue to grow in the U.S. and likely will become the largest
segment of the market by 2013, according to Ford Motor Co.'s top sales analyst.
George Pipas told the
Automotive Press Association in Detroit Friday that downsizing baby boomers and
millenials entering the market, looking for compacts and subcompacts, will
drive increased sales.
He also said early sales
results show that November U.S. car sales are looking much like October, which
was a decent month for the U.S. industry. October sales were flat compared with
the same month last year after months of sales declines. U.S. sales are down 25
percent so far this year.
By The Associated Press
The Dow rose 73.00, or 0.7
percent, to 10,270.47.
The broader Standard &
Poor's 500 index rose 6.24, or 0.6 percent, to 1,093.48. The Nasdaq composite
index rose 18.86, or 0.9 percent, to 2,167.88.
Benchmark crude for December
delivery lost 59 cents to settle at $76.35 a barrel on the New York Mercantile
Exchange.
In other Nymex trading,
heating oil fell 2.49 cents to settle at $1.9661 a gallon. Gasoline for
December delivery lost 2.43 cents to settle at $1.9162 a gallon. Natural gas
for December delivery added 2.2 cents to settle at $4.392 per 1,000 cubic feet.
In London, Brent crude for
December delivery gave up 47 cents to settle at $75.55 on the ICE Futures
exchange.