Weak dollar no quick fix for narrowing trade gap
WASHINGTON (AP) _ A weaker dollar may boost the nation's economy by increasing exports and narrowing the trade gap _ but that won't happen anytime soon.
Instead, the nation's trade deficit rose in September by the largest percentage in a decade as U.S. exports grew for the fifth straight month, but imports rose faster, a government report showed Friday. That trend is likely to continue until the middle of next year, economists said.
Rising oil prices and higher purchases of foreign goods by U.S. companies drove imports higher. So did more purchases of foreign parts by U.S. manufacturers, which are ramping up production in the fledgling economic recovery.
Earnings reports push stocks higher; Dow gains 73
NEW YORK (AP) _ Encouraging earnings news from major retailers and The Walt Disney Co. drew investors back into the stock market one day after a big drop.
Upbeat quarterly reports Friday from Abercrombie & Fitch Co., J.C. Penney Co. and Disney offset worries about a disappointing consumer confidence report. The Dow Jones industrial average gained 73 Friday after dropping 94 on Thursday.
The market briefly stumbled in morning trading after a report found the mood of consumers darkened. The preliminary Reuters/University of Michigan consumer sentiment index for November came in at 66.0, down from 70.6 in October. That made investors nervous that cautious consumers wouldn't step up spending at the holidays.
FDA finds bits of steel, rubber in Genzyme drugs
WASHINGTON (AP) _ Federal health regulators have found tiny particles of trash in drugs made by Genzyme, the second time this year the biotechnology company has been cited for contamination issues.
The Food and Drug Administration said Friday that bits of steel, rubber and fiber found in vials of drugs used to treat rare enzyme disorders could cause serious adverse health effects for patients.
Despite those problems, the FDA said the products would remain on the market, because there are few alternative treatments.
FDA regulators say doctors should closely inspect vials for particles before injecting them into patients. Doctors should return the product to Genzyme if they suspect contamination, the agency said.
Deficit doubles for government pension insurer
WASHINGTON (AP) _ The government-chartered company that insures the pensions of one in seven Americans said Friday that its deficit this year nearly doubled to $22 billion.
That's an improvement over the Pension Benefit Guaranty Corp.'s midyear record deficit of $33.5 billion, which spiked as auto makers and other companies faltered and caused the insurance fund's liabilities to spike.
Yet experts and officials say the long-term picture is grim. They say that without major changes, such as higher insurance premiums and less risky investments, the fund eventually will require a taxpayer bailout.
J.C. Penney reports sharp drop in 3Q profit
NEW YORK (AP) _ Department store chain J.C. Penney Co. reported a 78 percent drop in its third-quarter earnings because of a big expense for its pension plan, and its revenue slipped from a year earlier.
The moderate-price retailer upgraded its annual profit and sales outlook for the year because it is selling more items at full price or on planned promotions, but the outlook for holiday shopping remains uncertain.
The company expects sales at stores open at least a year, a key measure of a retailer's health, to fall between 4 percent and 6 percent in the quarter that includes the holidays, less than the 10.8 percent drop it suffered in the period in 2008. It expects to earn 70 cents to 85 cents per share for the period, compared with 95 cents a year ago, on revenue 3 percent to 5 percent lower than a year ago.
Realtors: Home prices to rise 4 percent in 2010
SAN DIEGO (AP) _ Home prices are expected to grow modestly next year and sales will keep rising as the housing market continues to recover from the worst downturn since the Great Depression, the National Association of Realtors said Friday.
Home resales are projected to total 5.7 million next year, up from an estimated 5 million this year. Prices will climb about 4 percent after a projected decline of 13 percent this year, according to Lawrence Yun, chief economist for the trade association.
The housing market's rebound has been aided by an aggressive federal intervention to lower mortgage rates and bring more buyers into the market. Home resales rose in September to the highest level in more than two years, something Yun said shows buyers are eager to get back into the market.
Computer programmers accused of aiding Madoff scam
NEW YORK (AP) _ Two former employees for Bernard Madoff programmed an old IBM computer to generate false records that concealed the crooked financier's massive Ponzi scheme and were given hush money when they threatened to stop lying, federal prosecutors said Friday.
Madoff gave orders to pay the pair "whatever they wanted to keep them happy," a criminal complaint said.
The complaint relies heavily on inside information provided by Madoff's chief financial officer, Frank DiPascali, who is cooperating after pleading guilty in August.
FDA questions safety of alcoholic energy drinks
WASHINGTON (AP) _ The Food and Drug Administration is challenging makers of alcohol-infused energy drinks to prove their beverages are safe, citing complaints that the products can cause risky behavior and injury.
The FDA issued a letter Friday to 30 beverage manufacturers, giving them 30 days to provide evidence that the combination of caffeine and alcohol is safe.
FDA officials stressed they have not reached a conclusion about the safety of beverages like Joose and Charge. Instead they are questioning the companies' legal rationale for marketing the products.
Oil dips to lowest level since October
NEW YORK (AP) _ Oil slid Friday to its lowest price in a month as investors started to pay more attention to a yearlong slump in American energy demand.
For most of the year, oil prices surged as investors pumped money into crude contracts to protect themselves from a weakening dollar. Oil was thought of as a safe bet with demand expected to rise next year.
But as crude prices doubled from March to October, consumers and businesses continued to use less gasoline and diesel. Refiners struggled. In parts of the Midwest this week, gasoline was selling at a cheaper price than the oil used to make it, according to the Oil Price Information Service.
Ford analyst sees small car segment growing
DETROIT (AP) _ Small car sales will continue to grow in the U.S. and likely will become the largest segment of the market by 2013, according to Ford Motor Co.'s top sales analyst.
George Pipas told the Automotive Press Association in Detroit Friday that downsizing baby boomers and millenials entering the market, looking for compacts and subcompacts, will drive increased sales.
He also said early sales results show that November U.S. car sales are looking much like October, which was a decent month for the U.S. industry. October sales were flat compared with the same month last year after months of sales declines. U.S. sales are down 25 percent so far this year.
By The Associated Press
The Dow rose 73.00, or 0.7 percent, to 10,270.47.
The broader Standard & Poor's 500 index rose 6.24, or 0.6 percent, to 1,093.48. The Nasdaq composite index rose 18.86, or 0.9 percent, to 2,167.88.
Benchmark crude for December delivery lost 59 cents to settle at $76.35 a barrel on the New York Mercantile Exchange.
In other Nymex trading, heating oil fell 2.49 cents to settle at $1.9661 a gallon. Gasoline for December delivery lost 2.43 cents to settle at $1.9162 a gallon. Natural gas for December delivery added 2.2 cents to settle at $4.392 per 1,000 cubic feet.
In London, Brent crude for December delivery gave up 47 cents to settle at $75.55 on the ICE Futures exchange.