Business Highlights

AP News
Posted: Dec 24, 2009 4:18 PM

Stocks end shortened session at new 2009 highs

NEW YORK (AP) _ Stocks ended a holiday-shortened session Thursday at new highs for the year following upbeat reports on unemployment and durable goods orders.

A weaker dollar also helped buoy the market, lifting energy and materials stocks. Christmas Eve trading was extremely light.

Stocks have managed to push higher in December on optimism about the economy, but at a more subdued pace than in recent months. As the year winds to a close, the Standard & Poor's 500 index up 66.5 percent since hitting 12-year lows in March.

The Dow Jones industrial average rose 53.66, or 0.5 percent, to 10,520.10.


Jobless claims, goods orders signal modest rebound

WASHINGTON (AP) _ A fitful economic recovery is drawing strength from a stabilizing job market and signs that manufacturing will contribute to the rebound.

The Labor Department said the number of newly laid-off workers filing claims for unemployment aid fell more than expected last week. The four-week average for claims, which smooths out fluctuations, fell for the 16th straight week, to its lowest point since September 2008, when the financial crisis hit with full force.

Further evidence of a gradually healing economy was a Commerce Department report that orders to U.S. factories for big-ticket durable goods rose in November.


Shoppers give stores last-minute sales surge

NEW YORK (AP) _ Shoppers appear to have given the nation's stores a needed last-minute sales surge.

Early readings from Toys R Us, Sears Holdings Corp. and several mall operators show packed stores on Christmas Eve following a busy week fueled by shoppers who delayed buying, waiting for bigger discounts that never came or slowed by last weekend's big East Coast snowstorm.

Stores are counting on these stragglers in a season that so far appears slightly better than last year's disaster. The jury is still out, because the week after Christmas accounts for about 15 percent of sales as gift card-toting shoppers return to malls.


Treasury removes cap for Fannie and Freddie aid

NEW YORK (AP) _ The government has handed its ATM card to beleaguered mortgage giants Fannie Mae and Freddie Mac.

The Treasury Department said Thursday it removed the $400 billion financial cap on the money it will provide to keep the companies afloat. Already, taxpayers have shelled out $111 billion to the pair, and most analysts hadn't expected the companies to hit the limit.

Treasury Department officials said it will now use a flexible formula to ensure the two agencies can stand behind the billions of dollars in mortgage-backed securities they sell to investors. The formula will provide the companies with a sufficient cushion based on projected losses over the next three years.


Energy futures on upswing but retail prices flat

Energy prices are ending the year on an upswing with large storms, falling supplies, a weak dollar and a slightly better employment picture sending futures higher.

Crude futures closed above $78 per barrel for the first time in more than a month Thursday in shortened holiday trading as the government reported that unemployment benefit claims from newly laid-off workers fell for the 16th straight week.

Yet there are few signs that demand has increased, meaning that any price hikes felt by consumers may be temporary.

Oil prices climbed 6 percent on the week, though stabilizing economy hasn't seriously dented huge stores of crude, natural gas and gasoline. Even with a 5 million barrel draw on crude reported Wednesday by the government, supplies remain well above normal.


Mortgage rates inch above 5 percent

McLEAN, Va. (AP) _ The average fixed-rate for a 30-year mortgage climbed above 5 percent for the first time in two months, leading to a decline in mortgage applications.

The average fixed rate on a 30-year mortgage was 5.05 percent this week, up from 4.94 percent last week, Freddie Mac said Thursday. The last time rates were above 5 percent was the week ending Oct. 29, when they were 5.03 percent.

Mortgage rates have risen since they hit a record low of 4.71 percent the week of Dec. 3. They are closely tied to yields on long-term government debt, which have gone up since then.


Congress raises debt ceiling to $12.4 trillion

WASHINGTON (AP) _ The Senate voted Thursday to raise the ceiling on the government debt to $12.4 trillion, a massive increase over the current limit and a political problem that President Barack Obama has promised to address next year.

The Senate's rare Christmas Eve vote, 60-39, follows House passage last week and raises the debt ceiling by $290 billion. The vote split mainly down party lines, with Democrats voting to raise the limit and Republicans voting against doing so. There was one defection on each side, by senators whose seats will be on the ballot next year: GOP Sen. George Voinovich of Ohio and Democratic Sen. Evan Bayh of Indiana.


Apple's stock hits new high as gadget buzz builds

NEW YORK (AP) _ Apple Inc. shares hit an all-time high Thursday after a published report suggested the intensely scrutinized yet secretive company may be getting ready for a major product announcement.

Citing unnamed people familiar with the preparations, the Financial Times reported on its Web site Wednesday that Apple has rented space for several days in late January at an arts center in San Francisco.

The company is famed for its highly staged launches. CEO Steve Jobs has used past events to introduce groundbreaking _ and lucrative _ gadgets such as the iPod and the iPhone.


Greece passes austerity budget amid debt crisis

ATHENS, Greece (AP) _ Greece's Socialist-led parliament approved a 2010 budget aimed at reducing the country's high deficit by boosting tax revenues while slashing spending and restricting salaries and new appointments in the public sector.

Following a five-day debate in parliament, and amid pressure from markets and other European Union countries, all 160 Socialist lawmakers approved the budget in Thursday's vote, while 139 from four opposition parties opposed it, and one deputy was absent.

Greece has promised to reduce the budget deficit from a projected 12.7 percent of gross domestic product in 2009 to below 9.4 percent next year, and as low as 8.7 percent if further cuts are successfully implemented.


Prisons: Madoff had dizziness, high blood pressure

BUTNER, N.C. (AP) _ The federal Bureau of Prisons says dizziness and hypertension were responsible for the hospitalization of Bernard Madoff.

Spokeswoman Traci Billingsley says Madoff is being treated at a hospital at the Butner federal prison in North Carolina. The 71-year-old disgraced financier was moved there Friday. Billingsley said Thursday that Madoff was not assaulted at the prison.

Duke University Medical Center earlier said Madoff had been treated there. But spokeswoman Debbe Geiger says the hospital had never had a patient by that name.

By The Associated Press

The Dow Jones industrial average rose 53.66, or 0.5 percent, to 10,520.10.

The Standard & Poor's 500 index rose 5.89, or 0.5 percent, to 1,126.48, while the Nasdaq composite index rose 16.05, or 0.7 percent, to 2,285.69.

Benchmark crude for February delivery rose nearly 2 percent, or $1.38 to settle at $78.05 on the Nymex.

In other Nymex trading in January contracts, heating oil rose 2.38 cents to settle at $2.0356 while gasoline rose 2.3 cents to settle at $1.9896. Natural gas tumbled 17.8 cents to settle at $5.643 per 1,000 cubic feet.

In London, Brent crude for February delivery rose 86 cents to settle at $76.31 on the ICE Futures exchange.