Business HighlightsPosted on Wednesday, November 9, 2011 - 04:01 am
Oil soars but motorists don’t need to worry yet
NEW YORK (AP) — Oil prices are soaring again, but motorists don’t need to worry — yet.
The price of crude has jumped 22 percent since the beginning of October and is nearing $100 a barrel. For most of the summer, oil prices drifted lower on fears that the U.S. was headed toward another recession. But those concerns have started to wane as the economy stabilizes. Political tensions in the Middle East, which produces 29 percent of the world’s oil, also have helped drive up crude prices at the fastest clip since February.
So far, the big jump hasn’t translated into a surge in prices at the gasoline pump. Gasoline has crept up less than 1 percent, or 3.1 cents, to $3.41 per gallon, over the same period.
That’s partly because people drive less once vacations wind down after Labor Day. This year, Americans have also bought less gasoline because of the weaker economy. That lackluster demand has kept prices in check, even as oil soars. If crude continues to rise, however, gasoline eventually will be forced to follow.
Employers post most job openings in 3 years
WASHINGTON (AP) — Employers advertised more jobs in September than at any other point in the past three years. The increase suggests hiring could pick up in the next few months.
Competition for jobs is fierce. And many employers aren’t rushing to fill some because they are worried about the strength of the economy.
Still, most economists say the increase in openings is a reassuring sign.
Nearly 3.4 million jobs were posted in September, the Labor Department said Tuesday. That’s the most since August 2008, one month before the financial crisis intensified.
Job openings have rebounded from a decade low of 2.1 million in July 2009. But they are well below the 4.4 million advertised in December 2007, when the recession began.
Berlusconi promises to resign amid Italy debt woes
ROME (AP) — Italian Prime Minister Silvio Berlusconi said for the first time Tuesday that he would resign once parliament approves economic reforms, and Greek politicians said they were close to agreeing on a new government to lead their country through painful cutbacks.
Both governments are under heavy pressure to reassure financial markets that the 17-country eurozone is moving quickly to reduce crippling government debts before those debts break apart the monetary union and plunge the world into a new recession.
Berlusconi’s promise to resign came during a meeting with Italian President Giorgio Napolitano after the prime minister lost his parliamentary majority during a routine vote earlier Tuesday. In a statement, Napolitano’s office said Berlusconi had agreed to step down once the economic reforms have passed parliament. A vote on the measures is planned for next week.
NY judge fines wealthy ex-hedge fund boss $92 million
NEW YORK (AP) — A judge cited the “huge and brazen” nature of the crime Tuesday as he imposed a record $92 million civil penalty on a billionaire hedge fund boss snared in the biggest insider trading case ever.
U.S. District Judge Jed Rakoff ordered the penalty for Raj Rajaratnam, saying his insider trading scheme “cries out for the kind of civil penalty that will deprive” him of a material part of his fortune, which at one time made him one of the world’s wealthiest people, with well more than a billion dollars. His attorneys have said he is no longer a billionaire.
Rajaratnam was convicted this year of insider trading and was sentenced last month to 11 years in prison. In the criminal case, he was also fined $10 million and ordered to forfeit $53.8 million in what the judge said were illicit profits from trading on confidential corporate information. He is scheduled to report to prison in December.
Haven’t booked a holiday flight yet? Smart move
NEW YORK (AP) — Haven’t booked your holiday flight yet? Smart move.
The cheapest fares for Thanksgiving and Christmas aren’t going to the travelers who booked months in advance. Experts say they’ll go to those who can take advantage of some last-minute deals.
In previous years, the rule was nearly always the same: Travelers who booked earliest got the cheapest fares. Those who waited generally faced higher prices.
This year, though fares are up and flights are fuller, travelers who’ve waited until the last minute to book Thanksgiving or Christmas flights can still find a deal if they know where — and how — to look.
In a year when airlines seem to have the upper hand, you may wonder why airfares on U.S. routes aren’t creeping higher as the holidays inch closer. The reason is airlines may have jacked some prices up too high, too fast. When that happens, airlines run sales closer to flight dates to fill the remaining seats on the plane. Airlines also ran many last-minute sales during the recession when Americans dramatically pulled back on flying.
Fannie Mae loss widens, asks taxpayers for $7.8 billion
WASHINGTON (AP) — Mortgage giant Fannie Mae is asking the federal government for $7.8 billion in aid to covers its losses in the July-September quarter.
The government-controlled company says it lost $7.6 billion in the third quarter. Low mortgage rates reduced profits, and declining home prices caused more defaults on loans it had guaranteed.
Fannie has received $112.6 billion so far from the Treasury Department — the most expensive bailout of a single company.
The government rescued Fannie Mae and sibling company Freddie Mac in September 2008 to cover their losses on soured mortgage loans.
Fannie’s July-September loss attributable to common shareholders works out to $1.32 per share. That compares with a loss of $3.5 billion, or 61 cents per share, in the third quarter of 2010.
Toyota quarterly profit drops 18.5 percent to $1 billion
TOKYO (AP) — Toyota said its quarterly profit slid 18.5 percent to $1 billion on plunging sales caused by parts shortages from the tsunami disaster in northeastern Japan and warned it faces a new challenge from flooding in Thailand.
Toyota Motor Corp. declined Tuesday to give a forecast for the full financial year ending March 2012, citing uncertainties stemming from the Thai floods which have disrupted supplies of parts and prompted it to cut some car production.
Toyota, Japan’s top automaker, said that vehicle sales plunged in the key markets of Japan and North America, but it was making up for some of the losses by strong sales in Asia, such as India and Indonesia.
Toyota’s quarterly sales fell nearly 5 percent from a year earlier to $58.7 billion.
Activision third-quarter earnings soar, 2011 outlook raised
NEW YORK (AP) — Activision Blizzard Inc. said Tuesday that its third-quarter net income nearly tripled thanks to strong demand for its video games. The company also raised its full-year outlook on the heels of Tuesday’s launch of its latest “Call of Duty” blockbuster.
The video game publisher earned $148 million, or 13 cents per share, in the July-September period. That’s up from $51 million, or 4 cents per share, a year earlier.
Revenue rose 1 percent to $754 million from $745 million.
Adjusted earnings were $87 million, or 7 cents per share, in the latest quarter — above the 2 cents per share that analysts polled by FactSet were expecting. Adjusted revenue was $627 million, above analysts’ expectations of $565 million.
Dynegy subsidiary files for bankruptcy protection
Dynegy Inc. said Tuesday that one of its subsidiaries is seeking bankruptcy protection as part of a plan that will force bondholders to take heavy losses while shielding major investors including billionaire Carl Icahn.
The Houston power company, which serves utilities in the Midwest, Northeast and the West, made the decision after struggling for years with lower electricity prices, falling credit ratings, and infighting among investors over competing takeover offers.
As part of its bankruptcy filing, Dynegy said it has agreed with some of its bondholders on a plan that would restructure $4 billion in debt.
McDonald’s October revenue figure rises
NEW YORK (AP) — McDonald’s Corp. said Tuesday that a key revenue figure rose 5.5 percent in October, fueled by sales in China and other foreign markets and the popularity of its Monopoly game in the U.S.
Revenue at stores open at least 13 months rose 5.2 percent in the U.S., 4.8 percent in Europe and 6.1 percent in the region covering Asia/Pacific, the Middle East and Africa.
The results in all regions beat analysts’ expectations, said Sara Senatore, an analyst at Sanford C. Bernstein.
The revenue figure is a snapshot of money spent on food at both company-owned and franchised restaurants. It does not reflect corporate revenue. It is a key measure of a restaurant chain’s performance, because it excludes the impact of recently opened or closed stores.
By The Associated Press(equals)
The Dow Jones industrial average rose 101.79 points, or 0.8 percent, to close at 12,170.18. The S&P 500 rose 14.80, or 1.2 percent, to 1,275.92. The Nasdaq composite rose 32.24, or 1.2 percent, to 2,727.49.
Benchmark crude rose $1.28 to end at $96.80 per barrel. Brent crude rose 44 cents to finish at $115 per barrel.
Heating oil lost less than a penny to end at $3.1161 per gallon. Gasoline fell 2.18 cents to finish at $2.7064 per gallon. Natural gas fell 4.9 cents to finish at $3.745 per 1,000 cubic feet.