Economic reports signal modest growth ahead
NEW YORK (AP) -- The economic recovery seems on track for slow but steady gains
after new reports Tuesday showed growth in manufacturing activity, construction
spending and contracts to buy homes.
The batch of new economic
data lifted spirits on Wall Street. But analysts cautioned that the economy
won't come roaring back from the worst recession in seven decades. Some say the
rebound's modest growth could falter next year as unemployment keeps rising.
In one hopeful sign, the
Institute for Supply Management said its manufacturing index showed growth in
November for a fourth straight month. The reading of 53.6 was slightly lower
than October's 55.7. But any reading above 50 indicates growth.
US November auto sales
struggle to gain ground
DETROIT (AP) -- U.S. auto
sales struggled to gain ground in November and big improvements aren't expected
until people stop worrying about losing their jobs.
Sales last month were mostly
stable, but even higher incentives couldn't push the needle much beyond last
November's dismal lows, when a credit freeze and the financial meltdown kept
car buyers at home.
One strength was sales of
fuel-efficiency cars and crossovers, which are as roomy as SUVs but are built
on lower car frames, bolstering fuel economy. Last month's big winner, again,
was South Korea's Hyundai, which posted double-digit sales growth. Sales at the
top three U.S. sellers -- General Motors, Ford and Toyota -- held steady, while
Chrysler struggled for another month.
Stocks climb as falling
dollar boosts commodities
NEW YORK (AP) -- The stock
market is picking up where it left off before its scare over debt problems in
Dubai.
Major stock indicators rose
more than 1 percent Tuesday, including the Dow Jones industrial average, which
jumped 126 points and traded above 10,500 for the first time since October of
last year.
The weakening dollar again
boosted stocks, a pattern that has played out for months. The cheaper U.S.
currency drove up commodities prices and lifted the stocks of energy and
materials companies that produce them.
Analysts said a mostly
upbeat array of economic reports and easing worries about the fallout from debt
struggles in Dubai gave investors who had jumped out of the market last week
reason to return.
GM CEO Henderson resigns
DETROIT (AP) -- General
Motors' CEO Frederick "Fritz" Henderson has resigned after eight
turbulent months as head of the largest U.S. automaker.
The company said Tuesday
that Chairman Ed Whitacre Jr. will serve as interim CEO. The company plans an
international search for a new president and chief executive.
At a press conference here,
Whitacre read a brief statement thanking Henderson for his work during a period
of challenge and change.
Henderson, 51, succeeded
Rick Wagoner on March 29 after the Obama administration ousted GM's former CEO
as the company worked through a government-led reorganization.
Staples sees N.A. retail
sales improvement
NEW YORK (AP) -- Staples
Inc., the largest U.S. office supply retailer, provided an upbeat outlook
Tuesday as it reported that its customers bought more school and office
supplies and technology products in its stores in the third quarter.
Staples North American
retail sales rose 1 percent to $2.6 billion in the third quarter, the first
rise in five quarters. But contract sales remained weak as small businesses are
slow to recover from the recession.
CEO Ron Sargent said the
company is feeling "increasingly optimistic about the future" and
predicted total sales will rise in the current quarter -- which includes
January, when many businesses start afresh with new budgets. He also expects a
better holiday season than last year's.
Shopping center group trims
Nov. sales forecast
NEW YORK (AP) -- A prominent
retail trade group trimmed its November sales growth forecast on Tuesday,
citing more shoppers saying they've delayed holiday purchasing compared with a
year ago.
Michael P. Niemira, chief
economist for the International Council of Shopping Centers, now predicts that
November sales at stores open at least a year -- a key industry barometer --
will be up 3 to 4 percent, below his original forecast for growth in a range of
5 to 8 percent. That compares with the steep 7.7 percent drop a year ago.
The uneven start is
worrisome to economists because how consumers behave during the holidays and
beyond will be key to how strongly the economy rebounds from the worst
recession since the 1930s.
Pfizer inks deal for new
drugmaking technology
TRENTON, N.J. (AP) -- Pfizer
Inc. will spend up to $115 million for rights to an Israeli biotech company's
experimental drug and its promising technology for making that drug and others
in carrot cells.
The world's biggest
drugmaker said Tuesday its deal with Protalix BioTherapeutics Inc. involves a
"groundbreaking" technology, the first to use plant cells to make
protein-based drugs, that would be safer than the animal cells now used by
biotech companies.
The deal also gives Pfizer
worldwide rights, except in Israel, to sell a genetically engineered drug
called taliglucerase alfa to treat a rare inherited condition called Gaucher's
disease. Caused by deficiency of a particular enzyme, it damages the liver and
bone marrow, sometimes leading to death.
Oil settles above $78 on
sliding dollar
Oil prices climbed Tuesday
as the dollar weakened and new figures showed energy demand for crude may be
growing in China.
Benchmark crude for January
delivery rose $1.09 to settle at $78.37 on the New York Mercantile Exchange.
The dollar grew weaker
against the euro, and since oil is largely bought and sold in dollars,
investors holding stronger currencies can buy more crude for less.
Oil also got support from a
Chinese industry group that said manufacturing activity expanded in November
for a ninth straight month along with rising stock markets around the world.
Northrop may to drop out of
tanker competition
Defense company Northrop
Grumman says it will drop out of the running for a major Air Force tanker
project valued at $35 billion unless the government changes its request for
bids.
Northrop Grumman President
and Chief Operating Officer Wes Bush wrote to the Pentagon saying the company
cannot accept the financial burdens included in the government's request for
proposals.
The letter leaves the door
open for Northrop Grumman to bid on the tanker if the Defense Department
changes the way the bidding is set up.
Northrop and Boeing Co. have
been fighting over the tanker contract for more than five years. The Pentagon
has tried and failed twice to award a contract to replace its old tankers that
refuel military planes in flight.
Govt proposes tougher side
air bag requirements
WASHINGTON (AP) -- New cars
and trucks would be required to have larger and stronger side air bags to
prevent motorists from being tossed out of vehicles during rollover crashes,
the government proposed Tuesday.
The plan is the latest
attempt by the government to address deadly rollover crashes. The National
Highway Traffic Safety Administration said the proposal, combined with
anti-rollover technology, would attempt to reduce the more than 10,000 deaths
in rollover crashes every year.
Car makers would need to
meet performance standards in rollover crashes that would likely lead to
"side curtain air bags made larger to cover more of the window opening,
(and) made more robust to remain inflated longer," the government said in
the proposal.
By The Associated Press
The Dow rose 126.74, or 1.2
percent, to 10,471.58, its highest close since October last year.
The broader Standard &
Poor's 500 index gained 13.23, or 1.2 percent, to 1,108.86, while the Nasdaq
composite index rose 31.21, or 1.5 percent, to 2,175.81.
Benchmark crude for January
delivery rose $1.09 to settle at $78.37 on the New York Mercantile Exchange.
In other Nymex trading in
January contracts, heating oil rose 3.01 cents to settle at $2.0780 and
gasoline gained 3.08 cents to settle at $2.0423. Natural gas lost 8.6 cents to
settle at $4.762 per 1,000 cubic feet.
In London, Brent crude for
January delivery gained 88 cents to settle at $79.35 on the ICE Futures
exchange.