AP
Business Highlights
Thursday July 3, 6:05 pm ET

62,000 jobs lost, off nearly half-million for year

WASHINGTON (AP) -- The nation lost jobs for a sixth month in a row in June, a storm of pink slips drenching this year's July Fourth holiday for more than 60,000 Americans and leaving thousands more worried about the future.

Weighed down by energy prices and the housing crisis, employers laid off workers in stores, factories and forsaken building sites.

With more job cuts expected in coming months, there's growing concern that many people will pull back on their spending later this year when the bracing effect of the tax rebates fades, dealing a dangerous setback to the shaky economy. These worries are rekindling recession fears.

In June alone, employers got rid of 62,000 jobs, bringing total losses so far this year close to a staggering half-million -- 438,000, according to the Labor Department's report released Thursday. The economy needs to generate more than 100,000 new jobs a month for employment to remain stable.

Stocks end mixed following jobs, services data

NEW YORK (AP) -- Wall Street capped a shortened trading week with a mixed finish Thursday after some uneven economic data: news of a contraction in the nation's services sector and a tame reading on employment. But stocks still had their third dismal week in a row, with the major indexes again posting losses as worries about rising oil prices and the fallout from the credit crisis dogged the market.

Investors hoping for some guidance from two key economic reports got very little. The Institute for Supply Management said its index of service sector activity fell to 48.2 from 51.7 in May; the reading touched off more misgivings about the well-being of the economy.

The look at the service sector followed a largely as-expected report from the Labor Department, which said the nation's unemployment rate held steady at 5.5 percent last month. The government also reported that 62,000 jobs were lost in June, but that number was close to economists' forecasts.

The jobs report did appear to assuage some worries that the snapshot of the labor market would be more grim. Employment numbers are critical because consumers who are out of work or are nervous about losing their job are likely to cut their spending. They've already become cautious because of higher food and energy prices.

Oil heads past $145 for 1st time; pump cost up too

NEW YORK (AP) -- Soaring fuel costs are taking some of the celebration out of this holiday weekend.

Oil prices headed into the busy Fourth of July break by racing past $145 a barrel for the first time Thursday. The story was no different at the gas pump, where the national average soared to within a whisker of $4.10 a gallon.

For a nation accustomed to hopping in the car or jetting cross-country on what is typically one of the busiest travel weekends of the year, the numbers are sobering:

--Last Independence Day weekend, drivers were paying just $2.95 a gallon for gas, about $1.15 less than today.

--Oil prices are up more than 50 percent since the start of the year. Prices rose by a similar amount in 2007 -- but it took almost the entire year for them to make that trip.

--Just this week alone, the price of a barrel of oil jumped 3.6 percent. And that was a shortened week.

ECB raises key rate to 4.25 percent

FRANKFURT, Germany (AP) -- Wary of higher energy and commodity prices, the European Central Bank raised its benchmark interest rate Thursday by a quarter percentage point to 4.25 percent, a move it hopes will help curtail rising inflation in the 15 countries that use the euro.

The move comes despite worries in some quarters that it could dampen growth, but ECB President Jean-Claude Trichet said at a press conference that the fundamentals of Europe's economy "are sound" and that the bank was focused on inflation -- which he said could remain high "for a more protracted period than previously thought."

He did not signal when rates might go up again, as he did at last month's meeting. The increase was the first since June 2007.

Thursday's move was widely expected, and Trichet said the decision was unanimous among members of the bank's governing council.

Howard Archer, the chief UK and European economist for Global Insight in London, took that to mean that the bank had clearly moved itself back into a neutral stance.

NY judge orders prison for former Refco CEO

NEW YORK (AP) -- The former head of Refco Inc., blamed for the collapse of one of the world's largest commodities brokerages, was sentenced to 16 years in prison Thursday by a judge who decried the "staggeringly arrogant" greed of white collar criminals.

Phillip Bennett, 59, a British citizen living in Gladstone, N.J., had previously pleaded guilty to conspiracy to commit securities fraud and other charges for the eight-year fraud.

Bennett said he didn't mean to hurt anyone. His voice cracked when he apologized to his family for their "unimaginable agony."

U.S. District Judge Naomi Reice Buchwald said the 20 separate crimes Bennett admitted he had committed and the $1.5 billion in losses he had caused were enough to explain her ruling.

But she said Bennett and others like him who break the law in their zeal to be among the world's richest people are "staggeringly arrogant."

Utah is going to a 4-day workweek to save energy

SALT LAKE CITY (AP) -- Starting next month, it will be "TGIT" for Utah state employees. As in: "Thank God It's Thursday."

In a yearlong experiment aimed at reducing the state's energy costs and commuters' gasoline expenses, Utah is about to become the first state to switch to a four-day workweek for thousands of government employees.

They will put in 10-hour days, Monday through Thursday, and have Fridays off, freeing them to golf, shop, spend time with the kids or do anything else that strikes their fancy. They will get paid the same as before.

The order issued by Republican Gov. Jon Huntsman will affect about 17,000 out of 24,000 executive-branch employees. It will not cover state police officers, prison guards or employees of the courts or Utah's public universities. Also, state-run liquor stores will stay open on Fridays.

Analyst: Chrysler, not GM, in biggest danger

DETROIT (AP) -- Faced with soaring gas prices, a sputtering economy and a rapid U.S. market shift away from trucks, the U.S. auto industry's weakest player, Chrysler, may have to file for bankruptcy or sell its storied Jeep and Dodge Ram brands as early as next year, JPMorgan said Thursday.

But rivals GM and Ford are likely to get through the rough patch and turn a profit in 2010.

JPMorgan auto analyst Himanshu Patel dismissed the possibility of an imminent bankruptcy at GM, saying in a conference call with investors and media that such fears "are completely overblown." The day before, GM shares slid to a 54-year low after Merrill Lynch auto analyst John Murphy wrote in a note to investors that a GM bankruptcy "is not impossible if the market continues to deteriorate and significant incremental capital is not raised."

Patel said the situation at Chrysler LLC is far more perilous because it has limited assets to raise cash and is more heavily reliant on trucks and on the North American market. Chrysler sales fell 22 percent in the first six months of this year.

Ky. lawyers face new trial in diet-drug settlement

COVINGTON, Ky. (AP) -- Two lawyers accused of defrauding their clients in a diet-drug settlement of $65 million were sent back to jail Thursday after a jury deadlocked and a federal judge declared a mistrial.

The jury had considered the case against suspended lawyers William Gallion and Shirley Cunningham Jr. for eight days, and twice in two days sent out notes indicating it was stumped. A third defendant, Melbourne Mills Jr., was acquitted earlier this week. All faced a single charge of conspiracy to commit wire fraud.

The case has been closely watched in the horse racing industry because Gallion and Cunningham are part-owners of 2007's Horse of the Year, Curlin. Curlin has won the Preakness, Breeders' Cup and Stephen Foster Handicap. The attorneys have since sold an 80 percent share of the horse.

By The Associated Press

The Dow rose 73.03, or 0.65 percent, to 11,288.54.

Broader stock indicators ended mixed. The Standard & Poor's 500 index rose 1.38, or 0.11 percent, to 1,262.90, and the Nasdaq composite index fell 6.08, or 0.27 percent, to 2,245.38.

Light, sweet crude for August delivery settled at a record $145.29 Thursday on the New York Mercantile Exchange, up $1.72 from the previous day. Earlier in the session, the contract rose to $145.85 a barrel, also a new high.

In other Nymex trading, heating oil futures rose 3.45 cents to settle at $4.106 a gallon, while gasoline futures added 2.16 cents to settle at $3.571 a gallon. Natural gas futures jumped 18.8 cents to settle at $13.584 per 1,000 cubic feet.

In London, Brent crude futures rose to a trading record of $146.69 a barrel on the ICE Futures exchange before settling at $146.08, up $1.82.