AP
Business Highlights
Wednesday August 27, 6:43 pm ET

Fannie Mae shakes up management team

WASHINGTON (AP) -- Mortgage finance giant Fannie Mae shook up its executive ranks Wednesday, after shares in it and sibling company Freddie Mac rose for a third straight day as investors appeared less certain a government bailout of the two troubled companies is imminent.

Fannie Mae, the largest buyer and backer of U.S. home mortgages, said its chief financial officer and two other top executives are leaving the company. Three current executives were promoted to replace them.

Fannie Chairman Stephen B. Ashley said in a statement that board members remain "firmly committed" to Chief Executive Daniel Mudd.

Durable goods post strong gains in June, July

WASHINGTON (AP) -- U.S. factories saw a surprisingly hefty increase in their orders for big-ticket products in July, reflecting continued strength in export sales and a boost to business investment from the government's tax stimulus package.

Economists, however, remain worried that spreading economic weakness overseas and a rebound in the value of the dollar could spell an end to the export boom later this year.

The Commerce Department said Wednesday that orders for durable goods rose 1.3 percent last month, far above the slight 0.1 percent increase Wall Street had been expecting.

The July increase matched a 1.3 percent rise in June

Stocks rise following durable goods report

NEW YORK (AP) -- Wall Street posted a big advance after the government reported a larger-than-expected increase in orders for big-ticket manufactured goods that indicated the economy is stronger than many investors thought.

The Commerce Department said orders for durable goods jumped 1.3 percent in July compared with the previous month, led by a big gain in demand for commercial aircraft. That was well above the 0.1 increase expected by economists surveyed by Thomson/IFR.

Oil ends higher as Gustav spins toward Gulf

NEW YORK (AP) -- Oil prices climbed for a third day Wednesday as fears deepened that Tropical Storm Gustav could enter the Gulf of Mexico as a powerful hurricane and disrupt oil and natural gas production.

On its current trajectory, Gustav could also damage fuel refineries along the vulnerable Gulf Coast and push gasoline prices higher at the pump in time for Labor Day weekend.

Light, sweet crude for October delivery rose $1.88 to settle at $118.15 a barrel on the New York Mercantile Exchange after earlier spiking as high as $119.63.

US thrifts 2Q loss of $5.4B is second largest ever

WASHINGTON (AP) -- U.S. thrifts lost $5.4 billion in the second quarter and set aside a record amount to cover losses from bad mortgages and other loans.

Data from the U.S. Office of Thrift Supervision released Wednesday show federally-insured savings and loan institutions posted their second-largest quarterly loss ever in the April-June period, after the $8.8 billion loss in the fourth quarter of last year. Heavily focused on mortgage lending, thrifts have been stung by mounting home-loan defaults.

Flights back to normal after FAA software glitch

ATLANTA (AP) -- The FAA said that most flights around the country were back to normal Wednesday, after a software malfunction delayed hundreds of flights on Tuesday.

The flight delays drew new criticism for the Federal Aviation Administration, which has been scrutinized over air traffic controller staffing levels and inspection standards for its ground-based equipment.

The Northeast was hardest hit by the delays prompted by a glitch at a Hampton, Ga., facility that processes flight plans for the eastern half of the U.S.

SEC proposes international accounting plan

WASHINGTON (AP) -- Federal regulators on Wednesday proposed a plan to allow public companies to begin using international accounting standards for reporting financial results in two years, and may require them to do so starting in 2014.

The push by the Securities and Exchange Commission toward acceptance of a single, global accounting standard has raised objections from some investor advocates and key lawmakers. Supporters of the change say it makes sense in an era of increasingly globalized financial markets and would help lure foreign companies to U.S. markets.

ConocoPhillips sells remainder of gas stations

NEW YORK (AP) -- ConocoPhillips will sell the remainder of its gas stations in the United States, the company said Wednesday, though Conoco, Phillips 66, and 76 will continue to operate under those familiar signs.

The 600 or so stations are being sold to Pacific Convenience & Fuel LLC, a subsidiary of PetroSun Fuel.

The deal is "in the ballpark" of $800 million, said Sam Hirbod, chairman and chief executive of PetroSun and Pacific Convenience.

Japan's Ricoh to buy IKON Office for $1.62 billion

MALVERN, Pa. (AP) -- IKON Office Solutions, which sells and leases copiers, printers and other office machines, has agreed to a $1.62 billion buyout offer from one of its suppliers, Ricoh Co. of Japan.

The deal will combine IKON's sales and service capabilities with Ricoh's engineering and manufacturing expertise, IKON said.

The cash offer of $17.25 per share disclosed Wednesday represents a 33 percent premium to IKON's average stock price for the last two months, the companies said.

Questions follow Mattel's $100M Bratz verdict

RIVERSIDE, Calif. (AP) -- The $100 million jury award in the three-month legal battle between Mattel Inc. and Bratz-maker MGA Entertainment Inc. left one key issue unresolved.

A judge must now decide whether MGA can continue to market the popular Bratz doll line and if it can, if it will have to pay Mattel royalties for some of those dolls.

Mattel attorneys said after Tuesday's verdict that they intend to file an injunction to stop MGA from making more Bratz dolls.

By The Associated Press

The Dow Jones industrial average rose 89.64, or 0.79 percent, to 11,502.51 after rising more than 140 points.

Broader stock indicators also rose. The Standard & Poor's 500 index gained 10.15, or 0.80 percent, to 1,281.66, and the Nasdaq composite index rose 20.49, or 0.87 percent, to 2,382.46.

Light, sweet crude for October delivery rose $1.88 to settle at $118.15 a barrel on the New York Mercantile Exchange after earlier spiking as high as $119.63. Crude has tacked more than $3 onto its price since Friday as worries over Gustav at least temporarily halt oil's steep, monthlong slide from July's record price above $147 a barrel.

The storm also boosted natural gas prices, which gained 11.6 cents to settle at $8.394 per 1,000 cubic feet.

In other Nymex trading, heating oil futures rose 5.18 cents to settle at $3.2617 a gallon, while gasoline prices gained 9.75 cents to settle at $3.0672 a gallon.

In London, October Brent crude added $1.59 to settle at $116.22 a barrel