Business Highlights

AP News
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Posted: Mar 17, 2011 6:16 PM

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Dealers raise some car prices after Japan crisis

DETROIT (AP) _ The disaster in Japan could slow shipments of popular cars like Toyota's Prius to auto lots. And many dealers are already taking advantage of expected shortages to raise prices.

Buyers will now typically have to pay sticker prices, instead of enjoying discounts that had been the norm for small cars and hybrids imported from Japan. Besides the Prius, models that suddenly cost more include Honda's Insight, Fit and CR-V; Toyota's Yaris; and several Acuras and Infinitis.

Dealers are acting on the possibility that disruptions in car deliveries from Japan will cause a shortage of higher-demand vehicles. Demand will exceed supply.

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Diet Coke passes Pepsi to become No. 2 soda in US

Diet Coke has topped rival Pepsi-Cola for the first time to become the second-most popular soft drink in the country behind Coca-Cola. It marks a victory for Coca-Cola Co. as its sodas now hold the top two spots, beating out its longtime rival PepsiCo Inc.

Diet Coke's rise reflects a long-term trend toward diet sodas. Ten years ago, only two of the top 10 were diet sodas. Now, four are on the list: the diet versions of Coke, Pepsi, Mountain Dew and Dr Pepper.

Coca-Cola sold nearly 927 million cases of its diet soda in 2010, to Pepsi's 892 million, a report by trade publication Beverage Digest released Thursday said.

Regular Coke remains far and away the most popular soda, selling 1.6 billion cases.

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Stronger economic reports help stocks rebound

NEW YORK (AP) _ Signs that the U.S. economy is improving helped investors put aside fears over Japan's nuclear crisis Thursday, if only temporarily.

A gauge of manufacturing in the mid-Atlantic region jumped in February to the highest point since January 1984. The survey from the Federal Reserve's Philadelphia branch showed new orders soared. Production at U.S. factories, mines and utilities dipped last month but was actually higher in previous months than first estimated, according to the Federal Reserve.

The Labor Department reported that the number of people applying for unemployment benefits fell more than economists expected last week. Ongoing claims dropped to the lowest level since October 2008.

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Strong economic data points to more hiring

WASHINGTON (AP) _ Factories are producing more cars, computers and household appliances, and applications for unemployment benefits over the past four weeks are at the lowest point since summer 2008.

Economic data released Thursday suggest that March will be the second straight month of strong job growth. And the reports helped Wall Street rebound a day after the market suffered its biggest drop in seven months.

Still, rising prices for household necessities and trouble overseas could slow the U.S. economy in the coming months.

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Bungling, cover-ups define Japanese nuclear power

TOKYO (AP) _ Behind Japan's escalating nuclear crisis sits a scandal-ridden energy industry in a comfy relationship with government regulators often willing to overlook safety lapses.

Leaks of radioactive steam and workers contaminated with radiation are just part of the disturbing catalog of accidents that have occurred over the years and been belatedly reported to the public, if at all.

In one case, workers hand-mixed uranium in stainless steel buckets, instead of processing by machine, so the fuel could be reused, exposing hundreds of workers to radiation. Two later died.

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Japan crisis weighing on US dollar against yen

WASHINGTON (AP) _ The crisis in Japan has pushed the U.S. dollar to its lowest levels since World War II, a trend that could give American exporters an advantage and help strengthen the U.S. economy.

Investors are selling off their dollars and buying yen on the expectation of a major rebuilding effort in Japan. A weaker dollar makes U.S. exports cheaper overseas. But it also could fuel inflation at a time when prices for food and oil are already creeping up.

The dollar had fallen Wednesday to the point where it took only 76.32 yen to buy $1 _ the lowest level since the mid-1940s. It rose to trade at 78.97 yen Thursday afternoon.

The dollar's value against the yen has been sliding for months. But the trend accelerated following last week's devastating earthquake, tsunami and resulting nuclear crisis.

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FDIC sues 3 former top executives of failed WaMu

WASHINGTON (AP) _ Federal bank regulators have sued three former top executives of Washington Mutual, the biggest U.S. bank ever to fail, accusing them of negligence in allowing risky mortgage lending and seeking $900 million in damages.

The Federal Deposit Insurance Corp. filed the civil lawsuit Wednesday against former WaMu CEO Kerry Killinger, ex-Chief Operating Officer Stephen Rotella and David Schneider, who headed the bank's home loans division. The FDIC also named Killinger's and Rotella's wives in the suit filed in federal court in Seattle.

The FDIC said the three executives pushed for expansion of WaMu's risky lending even though they knew or should have known that its loan standards and controls were inadequate. The bank collapsed in September 2008 and was sold for $1.9 billion to JPMorgan Chase & Co. in a deal brokered by the FDIC.

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Fed to soon give green light on bank dividends

WASHINGTON (AP) _ The Federal Reserve plans to tell some major banks on Friday whether they are healthy enough to boost stock dividends.

Banks can increase dividends if they pass "stress tests" showing that they can weather another recession.

All of the 19 largest banks overseen by the Fed were subject to the examinations _ even if they didn't intend to increase their dividend payments. Those banks include Citigroup, Bank of America, JPMorgan Chase & Co. and Wells Fargo.

The Fed's first stress tests were conducted in 2009 when the country was reeling from a severe recession and financial crisis. Those results were made public in a move to boost confidence in the fragile U.S. banking system.

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Some airlines put Japan expansion on hold

Even as airlines added extra flights to get people out of Tokyo, their long-term plans for expansion there have been thrown into doubt.

Delta Air Lines Inc. said on Thursday that it will suspend new flights to Tokyo's Haneda airport beginning next week. Singapore Airlines had planned to put the massive Airbus A380 on a flight from Singapore to Tokyo to Los Angeles later this month. But that flight will continue to be served by a Boeing 747 until further notice.

United Continental Holdings Inc., the biggest U.S. carrier to Asia, isn't cutting flights but is monitoring the situation. Both United and Delta use Tokyo's Narita airport as a hub for flights further into Asia.

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FedEx gives positive 4Q outlook, shares jump

NEW YORK (AP) _ FedEx Corp. says slow-but-steady economic growth should produce strong earnings for the current quarter, although fuel prices and Mideast turmoil remain big uncertainties.

The world's second-largest package delivery company was upbeat about the fourth quarter and year ending in May, saying revenue should continue to improve and its freight unit should return to profitability after 6 money-losing quarters. Shares rose 3 percent.

FedEx issued the outlook on Thursday as it reported that third-quarter earnings fell 3 percent. Rising fuel prices and harsh winter weather offset a double-digit rise in revenue.

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New York Times to start charging for website

NEW YORK (AP) _ The New York Times says it will start charging for access to its website and for the use of smart phone and tablet applications later this month in the U.S.

Beginning March 28, prices start at $15 for four weeks of full access to the website and the smart phone app.

Subscribers to the printed edition will keep free access to the website and apps. Others will be able to view 20 articles a month for free on the website and see the "Top News" section in the apps.

Newspapers are trying to increase digital revenue as online ad revenue, while growing, hasn't fully offset the declines in print.

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Oil prices settle above $101 per barrel again

NEW YORK (AP) _ Oil prices soared more than 3.5 percent, climbing back above $101 per barrel Thursday after a crackdown on protesters in Bahrain and the U.S. stepped up pressure for U.N. action against Libya's Moammar Gadhafi.

Prices also rose on the expectation that Japan will boost fuel imports as its refineries and factories recover from the earthquake and tsunami disaster. And the world's largest oil consumer, the U.S., reported that unemployment claims dropped to the lowest level since July 2008, raising hopes that oil and gasoline demand will soon increase.

Oil prices have been pushed and pulled in recent weeks by international crises that could have major impacts on world oil supplies and demand.

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By The Associated Press

The Dow gained 161.29 points, or 1.4 percent, to 11,774.59. The index fell 242 points Wednesday, its largest drop since August.

The Standard & Poor's 500 rose 16.84, or 1.3 percent, to 1,273.72. With Thursday's gains, the Dow and S&P 500 are up more than 1 percent for the year.

The Nasdaq rose 19.23, or 0.7 percent, to 2,636.05. The technology-heavy index is down 0.6 percent for the year.

Benchmark crude added $3.44 to settle at $101.42 per barrel on the New York Mercantile Exchange. In London, Brent crude rose $4.21, nearly 4 percent, to settle at $114.65 per barrel on the ICE Futures exchange.

In other Nymex trading for April contracts, heating oil gained 6.77 cents to settle at $3.0649 per gallon and gasoline futures added 10.69 cents to settle at $2.9506 per gallon. Natural gas rose 22 cents to settle at $4.158 per 1,000 cubic feet. In its weekly report, the Energy Department said the nation's natural gas supplies shrank by 56 billion cubic feet. Supplies are about 1.4 percent above the five-year average.