AP
Business Highlights
Friday November 21, 7:02 pm ET
Stocks surge on report of Geithner nomination
NEW
YORK (AP) -- Wall Street put a stop to a terrifying decline and stormed higher
Friday as President-elect Barack Obama appeared ready to tap the chief of the
New York Federal Reserve as the next treasury secretary and hand him the
herculean task of righting the U.S. financial system.
The
Dow Jones industrial average, which had broken even for the day until news of
the nomination leaked about an hour before the close, raced upward and finished
494 points higher, a rally of more than 6 1/2 percent.
The
outbreak of buying pushed the Dow above 8,000 -- a figure that would have
seemed like a nightmare three months ago but on Friday was a relief for
Americans who have watched their investments and retirement savings drain away
with alarming speed.
In
the two previous days, the Dow had lost a staggering 873 points, more than 10
percent of its value, and the broader Standard & Poor's 500 index had sunk
to its lowest level since 1997.
Pressure
on Citigroup builds, shares fall below $4
NEW
YORK (AP) -- Pressure intensified on Citigroup to sell part or all of itself as
its stock fell below $4 a share on Friday and fears escalated about future loan
losses.
CEO
Vikram Pandit told managers earlier in the day he opposes breaking up the
company, but the bank's board of directors was meeting Friday to discuss
whether to do exactly that, the Wall Street Journal reported.
What
investors are worried about is that all the risky debt sitting on Citigroup's
balance sheet will eventually turn into losses as the economy worsens and the
markets stay turbulent -- losses that could be nearly impossible to reverse.
FDIC
OKs backing for bank debt, deposits
WASHINGTON
(AP) -- The FDIC will guarantee up to $1.4 trillion in U.S. banks' debt for
more than three years as part of the government's financial rescue plan.
The
directors of the Federal Deposit Insurance Corp. voted Friday to approve the
plan, which is meant to break the crippling logjam in bank-to-bank lending.
The
FDIC will provide temporary insurance for loans between banks -- except for
those for 30 days or less -- guaranteeing the new debt in the event of payment
default by the issuing bank.
Automakers
need to make case for government aid
WASHINGTON
(AP) -- Democratic leaders ordered Detroit's Big Three automakers Friday to
submit what amounts to a detailed loan application to Congress so lawmakers can
decide whether to give the beleaguered industry an emergency $25 billion
lifeline.
In
a letter to the auto executives released Friday afternoon, House Speaker Nancy
Pelosi and Senate Majority Leader Harry Reid demanded a detailed accounting by
Dec. 2 of the companies' financial condition and short-term cash needs, as well
as how they would achieve long-term viability.
Bush
signs jobless benefits extension
WASHINGTON
(AP) -- With no end in sight to economic bad news, President George W. Bush on
Friday ensured that millions of laid-off workers will keep getting their
unemployment checks as the year-end holidays approach.
Bush
signed an extension of jobless benefits into law just before 8 a.m., as he was
preparing to leave the White House for a morning flight to Lima, Peru, to
attend the 21-nation Asia-Pacific Economic Cooperation forum.
Congressional
leadership rushed the bill to the White House after it was approved Thursday to
make the unusually quick bill signing possible before Bush left the country.
Wal-Mart
names Duke to succeed Scott as CEO
NEW
YORK (AP) -- Wal-Mart Stores Inc., the world's largest retailer, unexpectedly
announced Friday that its chief executive will retire in February and be
replaced by the head of its international division.
The
surprise change in leadership right before the crucial holiday season comes as
Wal-Mart has roared back to success as people looking for bargains shop more at
discounters. Still, the company faces hurdles ahead amid slowing growth in the
U.S., and analysts say the decision to tap an international executive serves as
a testament that the company sees its future growth oversees.
US
gas prices dip below $2, lowest in 3-plus years
HOUSTON
(AP) -- Only four months after peaking at an unheard of $4.11 a gallon, the
national average price for gasoline tumbled below $2 Friday, its lowest point
in more than three years. Yet the global economic contrast between then and now
could not be more stark.
There
was muted joy for consumers wading through an economy that's almost certainly
in recession, with thousands of jobs being lost and mortgage foreclosures
continuing to rise to record levels.
Light,
sweet crude for January delivery rose 51 cents to settle at $49.93 a barrel on
the New York Mercantile Exchange.
Foodmakers
Heinz, Smucker post higher earnings
MILWAUKEE
(AP) -- With consumers looking for comfort foods and ways to save money,
foodmakers H.J. Heinz Co. and J.M. Smucker Co. posted higher earnings Friday
and said they're benefiting from price increases and the trend of more people
eating at home.
Sales
in the recent three-month quarter were strong for Heinz's core products, like
its namesake ketchup, and T.G.I. Friday's frozen meals, and Smucker's fruit
spreads, Hungry Jack potatoes and pancakes.
Revenue
for Heinz rose 4 percent to $2.61 billion in the quarter ended Oct. 29, on a
7.1 percent worldwide price increase. Volume slipped 1.3 percent. Smucker's
sales rose 19 percent to $843.1 million in the three months ended Oct. 31, and
the Orrville, Ohio-based company said pricing was the primary driver, though it
also saw volume gains.
Boeing
warns of possible layoffs in 2009
UNDATED
(AP) -- Boeing Co. may lay off some workers next year as part of an effort to
cut costs in response to difficult market conditions and a slowing global
economy, a company executive said.
In
an internal memo sent to employees Thursday, Rick Stephens, senior vice
president of human resources, was quoted as saying the aerospace company
expects its number of employees to decline in 2009 after several years of
growth.
Japan's
central bank keeps interest rates on hold
TOKYO
(AP) -- Japan's central bank, which kept its already low interest rates on hold
Friday, looks like it may coast in neutral for a while despite signs of a
prolonged economic slump at home and abroad.
The
Bank of Japan last month cut its benchmark rate to 0.3 percent from 0.5
percent, so expectations for another rate reduction so soon were low. The
October rate cut also left Japan, which has the lowest interest rates among
major economies, with little wiggle room to loosen policy in the future.
Describing
the economy as "increasingly sluggish," the central bank said it does
not expect a turnaround anytime soon.
By
The Associated Press
The
Dow rose 494.13 points, or 6.54 percent, to settle at 8,046.42.
The
Standard & Poor's 500 index jumped 47.59, or 6.32 percent, to 800.03, and
the Nasdaq composite advanced 68.23, or 5.18 percent, to 1,384.35. The Russell
2000 index of smaller companies rose 21.23, or 5.51 percent, to 406.54.
Light,
sweet crude for January delivery rose 51 cents to settle at $49.93 a barrel on
the New York Mercantile Exchange.
In
other Nymex trading, gasoline futures rose 5.7 cents to settle at $1.0643 a
gallon. Heating oil gained 2.37 cents to settle at $1.6996 a gallon while
natural gas for December delivery advanced 16.4 cents to settle at $6.532 per
1,000 cubic feet.