Jobless claims fall, but hiring gains seem far off
WASHINGTON (AP) _ Fewer people are claiming unemployment benefits _ but still too many to signal that the economy is close to gaining jobs.
First-time claims for jobless benefits dropped last week to a seasonally adjusted 502,000, the Labor Department said Thursday. That's the fewest claims since the week ending Jan. 3, and below economists' estimates.
Claims would have to fall to the high 400s to indicate the economy could soon produce even a slight gain in jobs, estimates Abiel Reinhart, an economist at JPMorgan Chase. That level of claims could be reached by January, he said, and the economy should start gaining jobs sometime in the first quarter of 2010.
Drop in US energy use drags stock market lower
NEW YORK (AP) _ A drop in energy stocks dragged the market lower Thursday following a government report that consumers and businesses cut back on their use of oil and gas.
Major stock indexes slid about 1 percent from 13-month highs, including the Dow Jones industrial average, which fell 94 points after six days of gains.
A jump in petroleum supplies last week stirred worries that the falling demand for energy was a sign of more weakness in the economy. The report pushed crude oil down 3 percent, below $77 a barrel. A gain in the dollar also weighed on commodity prices by making them more expensive for overseas buyers.
Intel settles AMD claims but isn't off the hook
SAN FRANCISCO (AP) _ Intel Corp. will pay $1.25 billion to make peace with Advanced Micro Devices Inc., as the companies whose microprocessors run nearly all personal computers finally found common ground in a bitter and colorful dispute that caused international antitrust trouble for Intel.
The settlement announced Thursday sent AMD stock soaring and ended a 4-year-old lawsuit in which AMD accused Intel of abusing its dominance of the chip market to keep a lid on AMD's share. Intel has about 80 percent of the microprocessor market, and AMD has about 20 percent.
Wal-Mart, Kohl's: Holidays could be rough
NEW YORK (AP) _ Shoppers' focus on staples such as socks and underwear is driving murky holiday outlooks at Wal-Mart and Kohl's, even as both posted higher third-quarter earnings Thursday.
Both signaled they plan aggressive discounting to hang on to customers and drive sales this holiday season.
Wal-Mart Stores' price-cutting campaign is bringing more shoppers in the door. But they're spending less when they get there because the goods are priced lower.
Meanwhile, department store operator Nordstrom Inc. announced late Thursday that its profit rose 17 percent in its fiscal third quarter, and it raised its 2009 profit outlook. Luxury stores such as Nordstrom saw solid sales gains last month from the sharp falloff a year ago.
Dollar edges up but developing nations still worry
NEW YORK (AP) _ The dollar edged up Thursday, breaking a decline that's caused developing countries to worry that the sinking U.S. currency is making their exports expensive and threatening their fledgling economic recoveries.
A lower dollar _ and China's yuan, which is effectively pegged to the dollar _ makes other countries' goods relatively more expensive. China has recently signaled that it might be ready to let its currency rise.
American manufacturers contend that China's yuan is undervalued by 20 to 40 percent against the dollar, giving the country a huge trade advantage. On the other hand, the yuan's low value allows U.S. consumers and major retailers, such as Wal-Mart, to buy Chinese imports cheaply.
Iberia, British Airways agree basis for merger
MADRID (AP) _ Iberia and British Airways have approved an agreement establishing the basis for a merger, the Spanish carrier said late Thursday.
Iberia called it a "binding agreement" aimed at creating one of the world's largest airline groups, with a fleet of 419 aircraft flying to 205 destinations.
The company would take the form of new holding company that owns the two current carriers. Iberia would own 45 percent of the new company, and British Airways 55 percent, Iberia said.
The deal is expected to be signed in the first quarter of 2010 and be approved by shareholders by the end of that year, the Spanish carrier said. The deal would need regulatory and shareholder approval.
Fed: banks need customer consent on overdraft fees
WASHINGTON (AP) _ Banks will have to secure their customers' consent before charging large overdraft fees on ATM and debit card transactions, according to a new rule announced Thursday by the Federal Reserve.
The rule responds to complaints from consumer groups, members of Congress and other regulators that the overdraft fees are unfair because many people assume they can't spend more on a debit card than is available in their account. Instead, many banks allow the transactions to go through, then charge fees of up to $25 to $35.
For small purchases, such as a cup of coffee, the penalty can far exceed the actual cost of the transaction.
Banks borrow less from emergency Fed program
WASHINGTON (AP) _ Banks borrowed slightly less from the Federal Reserve's emergency lending program over the past week, and reduced their use of other credit programs designed to ease the financial crisis.
The Fed said Thursday that commercial banks averaged $20.8 billion in daily borrowing over the week that ended Wednesday. That's down $1.81 billion from the week that ended Nov. 5, and far less than the $95.38 billion they borrowed a year ago at the height of the credit crisis.
The drop in borrowing followed a slight increase last week _ the first since Sept. 2.
The identities of the financial institutions are not released. They pay just 0.50 percent in interest for the emergency, overnight loans.
Disney posts surprise uptick in 4Q net income
LOS ANGELES (AP) _ The Walt Disney Co. posted a surprise 18 percent increase in fourth-quarter earnings Thursday in a sign the company is beginning to emerge from an advertising market hit hard by the recession.
The better-than-expected results, announced amid an executive overhaul, came despite overall ad revenues still being down and the movie studio still posting a loss, though with a slight uptick in revenue there.
Net income rose to $895 million, or 47 cents per share, as revenue at its cable, broadcast and movie studio units rose, more than offsetting declines at its parks and consumer products units.
Bank of America CEO search still looms
CHARLOTTE, N.C. (AP) _ With Bank of America Corp. CEO Ken Lewis retiring in less than seven weeks, analysts don't see any candidate emerging as a front-runner for his successor.
The bank said this week that Lewis' replacement could be announced by late November. The board is considering a handful of insiders including Chief Risk Officer Gregory Curl and Brian Moynihan, the head of consumer banking. Other heads of Bank of America's major business units are also being considered, the bank has said.
The company has not identified any external candidates, but media reports have said Bank of New York Mellon Corp. CEO Bob Kelly remains a possible candidate although he has repeatedly expressed his lack of interest.
By The Associated Press
The Dow fell 93.79, or 0.9 percent, to 10,197.47. The Dow had been up 519 points, or 5.3 percent, in the prior six days _ its longest stretch of gains since late August.
The broader S&P 500 index fell 11.27, or 1 percent, to 1,087.24, and the Nasdaq fell 17.88, or 0.8 percent, to 2,149.02.
The Russell 2000 index of smaller companies fell 12.39, or 2.1 percent, to 580.32.
Benchmark crude for December delivery gave up $2.34 to settle at $76.94 a barrel on the New York Mercantile Exchange.
In other Nymex trading, heating oil lost 6.48 cents to settle at $1.991 a gallon. Gasoline for December delivery gave up 5.22 cents to settle at $1.9405 a gallon. Natural gas for December delivery fell 13.3 cents to settle at $4.37 per 1,000 cubic feet.
In London, Brent crude for December delivery fell $1.93 to settle at $76.02 on the ICE Futures exchange.