Business Highlights

AP News
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Posted: Mar 24, 2011 6:24 PM
Business Highlights

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Applications for unemployment aid drop slightly

Fewer people applied for unemployment benefits last week, adding to evidence that layoffs are slowing and employers may be stepping up hiring.

The number of people seeking benefits dropped by 5,000 to a seasonally adjusted 382,000 in the week ended March 19, the Labor Department said Thursday.

The fourth decline in five weeks lowered the four-week average to 385,250, the fewest for that measure since July 2008. The four-week average has fallen almost 11 percent in the past seven weeks.

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Durable goods orders fall 0.9 percent in February

Companies trimmed their orders for long-lasting manufactured goods in February, buying fewer computers, machines and primary metals.

Durable-goods orders fell 0.9 percent last month, the Commerce Department said Thursday. It was the fourth decline in the past five months.

Orders in a category that signals business investment plans dropped 1.3 percent. That followed a 6 percent decline in January, the biggest drop in two years. Economists said harsh weather may have kept some businesses from placing orders.

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Nissan mulls shifting some engine production to US

DETROIT (AP) _ Nissan Motor Co. said Thursday it is considering moving some engine production from Japan to the U.S. because of earthquake damage to a Japanese plant, another illustration of how seriously the disaster has upended the global network of auto supplies.

Car factories could face serious shortages of Japanese parts by the middle of next month unless Japan's auto industry can quickly restart its shuttered production following a devastating earthquake and tsunami March 11, experts say.

As stockpiles of parts from Japan run low in the coming weeks, some North American plants are bracing for shutdowns. Toyota has warned workers it may idle operations.

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Rate on 30-year fixed mortgage rises to 4.81 pct.

NEW YORK (AP) _ Fixed mortgage rates edged up this week, but even 30-year rates below 5 percent have done little to boost home sales.

Freddie Mac said Thursday the average rate on the 30-year fixed mortgage rose to 4.81 percent from 4.76 percent the previous week. It hit a 40-year low of 4.17 percent in November.

The average rate on the 15-year fixed mortgage increased to 4.04 percent from 3.97 percent. It reached 3.57 percent in November, the lowest level on records dating back to 1991.

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Portugal edges toward bailout after govt quits

LISBON, Portugal (AP) _ Portugal's economic future looked increasingly bleak Thursday as political paralysis, a grinding debt burden and a double-dip recession pushed it one step away from becoming the third eurozone country to take a bailout.

The country's woes quickly piled up a day after the cash-strapped government resigned following Parliament's rejection of its debt-reduction policies. Portugal's borrowing costs surged to unsustainable levels while an international ratings agency downgraded its credit worthiness.

And as the country veered off course, there was no indication who might take the wheel, or when.

It wasn't clear whether the interim government has the authority to negotiate a bailout, nor whether a broad coalition government may be possible or how soon new elections could be held. It would likely take at least two months for a ballot to be organized in accordance with constitutional requirements.

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Bernanke to begin holding news conferences

Federal Reserve Chairman Ben Bernanke will begin holding news conferences four times a year to answer questions about the Federal Reserve's policy decisions. It represents a significant shift in strategy for the central bank, one that will give it a chance to defend actions that in recent months have faced harsh criticism.

The decision, which was announced Thursday, comes after the Fed held an unusual videoconference last fall in large part to discuss the need to improve its communications with the public. A Fed committee also had been studying whether to begin holding periodic news conferences.

Bernanke's first news conference will take place after the Fed's April 27 meeting. That will augment the current communications strategy: a brief statement released after each of the Fed's eight policy-making meetings with no officials available to answer questions.

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Walgreen to spend about $429M for drugstore.com

NEW YORK (AP) _ Drugstore operator Walgreen Co. said Thursday it will spend about $429 million to buy online retailer drugstore.com in a deal that gives it access to 3 million online customers.

The largest U.S. drugstore operator will give drugstore.com shareholders $3.80 in cash for each of their shares _ more than double the $1.79 closing price of drugstore.com's stock on Wednesday. On Thursday the stock jumped $2.03 to close at $3.82.

The acquisition will add about 60,000 products to Walgreen's online offerings, and the Deerfield, Ill., company said it will significantly speed up its online strategy. Drugstore.com is one of the largest online health and beauty retailers, and Walgreen has said those products are an important part of its strategy. Drugstore.com's websites include Beauty.com, SkinStore.com and VisionDirect.com. Despite its name, it does not have a pharmacy business, as it sold that division in July 2010.

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L.L. Bean stamps out shipping charges

FREEPORT, Maine (AP) _ As retailers increasingly turn to free shipping to lure customers, L.L. Bean is upping the ante by waiving shipping fees all the time, with no minimum order, putting pressure on rivals.

Effective Friday, the outdoors and clothing retailer joins Zappos.com in offering year-round, no-strings-attached free shipping, going against the grain in an industry accustomed to selective free-shipping offers, particularly around the holidays, and sometimes tied to minimum purchases or vanity credit cards.

Steve Fuller, L.L. Bean's chief marketing officer, said the company had been toying with the idea for the past three years as it tested occasional free shipping.

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By The Associated Press(equals)

The Dow Jones industrial average rose 84.54 points, or 0.7 percent, to close at 12,170.56. The Standard & Poor's 500 index rose 12.12, or 0.9 percent, to 1,309.66. The Nasdaq composite index rose 38.12 points, or 1.4 percent, to 2,736.42.

Benchmark crude prices for May delivery fell 15 cents to settle at $105.60 per barrel on the New York Mercantile Exchange.

In other Nymex trading for April contracts, heating oil added nearly a penny to settle at $3.0787 a gallon and gasoline futures rose 2.22 cents to settle at $3.0508 per gallon.

In London, Brent crude gained 13 cents to settle at $115.60 per barrel on the ICE Futures exchange.