Americans increase spending, but not on new homes
WASHINGTON (AP) _ Americans are starting to spend a bit more money, but not enough to power a strong economic recovery. Consumer spending posted its second straight monthly increase in November, rising 0.5 percent, the government said Wednesday. But new home sales plunged unexpectedly to the lowest level since April.
The reports were evidence that the recovery from a deep recession is proceeding in fits and starts, with households struggling in a bleak job market. At the same time, economists said the economy was much improved from this time last year, when the nation was gripped by the financial crisis.
Stocks finish slightly higher despite housing data
NEW YORK (AP) _ Stocks ended an erratic session with a slender gain Wednesday as rising commodities prices offset disappointment over an unexpected drop in home sales.
Gains in commodities drove the shares of energy and materials-producing companies higher, lending support to the overall stock market. Gold, oil and other commodities rose as the dollar dropped. The Dow Jones industrial average rose 1.51, or 0.01 percent, to 10,466.44.
The dollar snapped a four-day winning streak as the latest economic data reinforced investors' belief that the recovery will be slow.
Ford expects Volvo deal with Geely in Q1
STOCKHOLM (AP) _ Ford Motor Co. said it is moving closer to selling its Swedish Volvo brand, even though the U.S. automaker is in far better financial shape than it was when it put the brand up for sale last year.
The Dearborn, Mich., automaker said Wednesday that it expects to finalize the sale of Volvo to China's Geely Group early next year if financing and government approvals fall into place.
Ford did not reveal the amount of Geely's offer. Auto analyst Matts Carlson estimated the price tag for Volvo at between $2 billion and $2.3 billion.
BlackBerry users beset by second outage in a week
TORONTO (AP) _ The second BlackBerry outage in less than a week disrupted service for millions of users on two continents, frustrating people so reliant on the messaging devices that they peck at their keyboards all day and keep the gadgets on their nightstands while they sleep.
When the problems began Tuesday afternoon, Twitter and other online forums were peppered with laments about the failure of a gadget that has been dubbed the "CrackBerry" because it can be so addictive.
The company behind the service, Canada's Research in Motion Ltd., blamed a software upgrade for the problem, which it said was confined to North and South America.
Energy futures spike; pump prices still flat
Holiday travelers can expect gasoline prices to remain steady into the New Year even though energy futures spiked Wednesday on a big draw down of crude and gasoline supplies.
Energy experts were expecting the amount of crude in storage to fall, mostly because refiners empty their tanks at this time of year for tax purposes.
But crude fell by 5 million barrels last week, more than twice what was expected. Gasoline stores fell more than expected and demand figures are rising somewhat. On top of that, the amount of crude being imported into the country fell to the lowest level since 2003, news that gave energy markets a jolt.
Citi, Wells Fargo repay TARP money
NEW YORK (AP) _ Citigroup Inc. said Wednesday it has repaid the $20 billion in bailout money it received from the government, while Wells Fargo & Co. announced that it had repaid the $25 billion.
Citi said it funded the previously announced repayment with a recent stock offering that raised $20.5 billion. The offering included $17 billion in common shares and $3.5 billion in what are called tangible equity units, which can be converted into common stock at a later date.
Earlier Wednesday, Wells Fargo said a public stock offering that raised $12.25 billion helped fund the repayment.
Indian super-compact car market overtakes Japan
MUMBAI, India (AP) _ India has emerged the leader in small cars, overtaking Japan, as declining sales in Western markets coupled with robust growth in Asia redraws the global map of the auto industry faster than many expected.
It's well known that China will overtake the U.S. as the world's largest car market this year. Less noticed is the fact that India will top Japan for the first time in sales of super-compact cars. It overtook Japan as the world's number one producer of basic cars in 2007.
Automakers are pouring hundreds of millions of dollars into the country, hoping to capture a piece of the growing market for tiny, inexpensive passenger vehicles. As they do so, they are quietly transforming India into an export hub for small car manufacturing.
China central bank says recovery still weak
BEIJING (AP) _ China's central bank warned Wednesday that the country's economic recovery is still weak despite improving conditions and said changes in its development model are urgently needed.
In a quarterly report, the People's Bank of China also said it is studying ways to improve oversight of China's financial industry and guard against excessive risk.
The communist government is trying to reduce reliance on exports and investment by boosting domestic consumption, a key element of its 4 trillion yuan ($586 billion) stimulus. Economists say such a change is essential if China is to continue growing, and the plunge in global demand has made it more necessary.
Boston Scientific to pay $22M in payment inquiry
NEW YORK (AP) _ U.S. attorneys in Boston said Wednesday heart device maker Boston Scientific will pay $22 million to resolve allegations its Guidant division paid kickbacks to doctors to get them to use its heart devices.
The U.S. Department of Justice said Guidant paid physicians $1,000 to $1,500 each in 2003 and 2004 to participate in four studies, called RaCE, RaCE II, RaCE III, and MERITS. It said the studies were designed to increase sales of pacemakers and defibrillators.
Federal officials said the company targeted doctors who favored products made by other companies, hoping the payments would induce them to use Guidant devices more often. They said Guidant submitted claims for payment on the devices to Medicare.
Buffett's company continues cutting Moody's stake
OMAHA, Neb. (AP) _ Billionaire Warren Buffett's company is continuing to reduce its stake in credit ratings firm Moody's Corp., but Berkshire Hathaway Inc. still controls about 13 percent of Moody's stock.
Berkshire sold 87,992 Moody's shares on Friday. The Omaha-based company revealed the latest sale in documents filed Tuesday with the Securities and Exchange Commission.
Over the past nine months, Berkshire has significantly reduced its Moody's holdings. Berkshire held 48 million shares in March and reduced that stake to 31.8 million as of last week.
By The Associated Press
The Dow Jones industrial average rose 1.51, or 0.01 percent, to 10,466.44.
The Standard & Poor's 500 index rose 2.57, or 0.2 percent, to 1,120.59, while the Nasdaq composite index gained 16.97, or 0.8 percent, to 2,269.64.
Benchmark crude for February delivery rose $2.27 to settle at $76.67 on the New York Mercantile Exchange.
In other Nymex trading in January contracts, heating oil rose 6.32 cents to settle at $2.0118 while gasoline gained 7.78 cents to settle at $1.9666. Natural gas rose 10.6 cents to settle at $5.821 per 1,000 cubic feet.
In London, Brent crude for February delivery rose $1.53 to $74.99 on the ICE Futures exchange.