Stocks close lower after economy report
NEW YORK (AP) — U.S. stocks declined Wednesday after a report showed that the U.S. economy unexpectedly contracted in the fourth quarter of last year. That put the brakes on a January rally that has pushed stocks toward record levels.
The Dow fell 44 points to 13,910 -- its biggest decline in three weeks. The S&P 500 logged its biggest decline of the year, falling 6 points to 1,501 -- after rallying close to a record. The Nasdaq fell 11 points to 3,142.
Asia stocks fall on unexpected dip in US economy
BANGKOK (AP) — An unexpected contraction in the U.S. economy at the end of 2012 has sent Asian stock markets into retreat.
One analyst in Australia says "the market has been looking for any excuse to pull back after such an epic month."
The Nikkei 225 in Tokyo fell 0.6 percent to 11,047.59 after the government reported lower-than-expected growth in December's industrial production.
Hong Kong's Hang Seng fell 0.5 percent, while South Korea's Kospi shed 0.4 percent and Australia's S&P/ASX 200 fell 0.2 percent, following 10 straight sessions of gains. Benchmarks in Taiwan, Indonesia and Malaysia fell. Mainland China was mixed. The Philippines rose.
Oil prices are hovering below $98 a barrel, consolidating recent gains as traders waited for more economic indicators from the U.S. Benchmark oil for March delivery was down 4 cents to $97.90 at midday Bangkok time in electronic trading on the New York Mercantile Exchange.
Jobless numbers and weekly mortgage rates coming
WASHINGTON (AP) — The Labor Department releases weekly jobless claims and the fourth-quarter employment cost index this morning. Also today, Freddie Mac, the mortgage company, releases weekly mortgage rates and the Commerce Department releases personal income and spending for December.
There are also quarterly financial results expected from a number of companies including Aetna, MasterCard, United Parcel, Viacom, Honda and Royal Dutch Shell.
Unemployment rates fall in most large US cities
WASHINGTON (AP) — The Labor Department says unemployment rates fell in more than three-quarters of the largest U.S. cities in November compared with the same month a year ago, evidence modest hiring is benefiting most areas of the country.
Rates fell in 290 of the nation's 372 largest metro areas. Rates rose in 68 cities and were unchanged in 14.
Fewer cities are also reporting painfully high rates. The number of metro areas with unemployment rates above 10 percent fell to 47 from 70.
The biggest annual decline was in Las Vegas, where the rate fell to 10 percent from 13.3 percent. Midland, Texas, reported the lowest rate, at 3.1 percent.
Yuma, Ariz., and El Centro, Calif., had the highest rates, at 27.3 percent and 25.5 percent, respectively.
MEDICARE PRICE CUT
WASHINGTON (AP) — Medicare is announcing a price cut.
Diabetes testing supplies now average about $16 a month for beneficiaries. That's going down to around $4.50.
Savings are also coming for many patients who rent home oxygen gear, hospital beds, wheelchairs and other equipment.
Medicare deputy administrator Jonathan Blum said Wednesday it's due to competitive bidding making inroads against wasteful spending.
Starting July 1, diabetes patients will get blood sugar testing supplies through a new national mail order program.
Competitive bidding for home medical equipment, now being piloted in nine cities, will expand to 100 metro areas, including New York, Los Angeles and Chicago.
Some seniors may have to switch suppliers, but taxpayers will save nearly $26 billion over 10 years.
Outside experts say Medicare should make even greater use of competitive bidding.
Boeing sticks to production plans, battery for 787
UNDATED (AP) — Boeing CEO Jim McNerney says the company is sticking with plans to speed up production of its 787 and sees no reason to drop the troubled lithium-ion batteries at the center of the plane's problems.
A fire and emergency landing earlier this month, both involving the batteries, prompted regulators to ground Boeing's newest and highest-profile plane.
All Nippon Airways said Wednesday that it replaced batteries 10 times before the overheating problems surfaced earlier this month. McNerney says airlines have been replacing 787 batteries at a rate that's "slightly higher" than Boeing had expected. They've all been replaced for maintenance reasons, not for safety concerns, he said on a conference call.
Boeing says about 2,000 batteries of all types are replaced every year on its various planes.
U.S. aviation officials have asked Boeing for a full operating history of the batteries on the 787s.
McNerney says "good progress" is being made in finding the cause of the problems. But he didn't have a timeline for when the plane would get back in the air.
Victims jockey to maximize refunds in PFGBest case
IOWA CITY, Iowa (AP) — The judge overseeing the bankruptcy of an Iowa-based brokerage that was looted for years by its founder is faced with an unusual decision in divvying up the company's remaining assets.
U.S. Bankruptcy Judge Carol Doyle must decide whether customers who traded foreign currency through Peregrine Financial Group, Inc., are entitled to getting some or all of their money back even though they may have known going in that such trades were less protected.
Company founder Russ Wasendorf Sr., is expected to be sentenced to prison on Thursday for embezzling up to $215 million in funds.
Customers who traded in commodities through the company say they should be repaid first, even though Wasendorf looted their accounts.
Twinkies primed for a comeback
NEW YORK (AP) — Hostess has picked a lead bidder for its famous Twinkies.
The bankrupt company says it has selected a joint offer from two investment firms — C. Dean Metropoulos & Co. and Apollo Global Management LLC — as the lead bid for its Twinkies and other snack cakes.
Hostess, says the two are offering to pay $410 million for the snack-cake business and five bakeries.
The joint "stalking horse" bid would set the floor for an auction process that lets competitors make better offers. A judge would have to approve any final sale.
After years of management turmoil and turnover, Hostess declared it was going out of business and selling its brands in November. The company already announced separate lead bidders for its other brands including Drake's cakes and Wonder bread.
New Blackberry won't be released in US until March
NEW YORK (AP) — Research In Motion Ltd. unveiled new, versatile BlackBerrys after excruciating delays allowed Apple, Samsung and others to build commanding leads in an industry that is redefining society. But the first phone won't come out in the United States until March, and one with a physical keyboard will take at least a month longer.
The stock fell 12 percent after Wednesday's kickoff, despite mostly positive reviews about the new BlackBerry 10 operating system. There's concern the phone isn't coming out sooner, and there's worry BlackBerry 10's advances won't be enough to turn the company around.
In a move underscoring the stakes riding on its make-or-break product lineup, RIM used the occasion to announce that it is changing the company's name to BlackBerry. It's a pioneering brand that lost its cachet not long after Apple's 2007 release of the iPhone, which reset expectations for what a smartphone should do.
Corvette high-performance engines moving to Ky.
BOWLING GREEN, Ky. (AP) — General Motors will rev up engine production at the Kentucky plant that assembles Corvettes.
The automaker announced Wednesday it will build specialty, high-performance engines for the iconic sports car at its Bowling Green assembly plant, shifting the work from GM's Performance Build Center in Wixom, Mich. The transfer will add 20 jobs at the Bowling Green plant, where the work force is nearly 700.
The $3.5 million relocation to Kentucky comes on top of a $131 million investment announced in 2011 to build a new body shop and retool the Bowling Green plant for production of the next-generation Corvette. The all-new 2014 model is scheduled to reach dealers' show rooms by the third quarter of this year.
Bangladesh arrests owners over deadly factory fire
DHAKA, Bangladesh (AP) — Police in Bangladesh have arrested two owners of a garment factory where a fire killed seven workers last weekend.
Police were questioning the two men Thursday after a court placed them on a two-day remand. Smart Export Garment Ltd. Chairman Sharif Ahmed and managing director Zakir Ahmed face charges of negligence and murder, and a police case has been filed against the duo and another official.
Garment industry workers and labor rights groups had demanded the arrest of the owners for their alleged negligence.
The fire occurred just two months after a blaze killed 112 workers in another factory.