Business Highlights

AP News
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Posted: May 09, 2011 6:23 PM
Business Highlights

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Biden and Clinton lecture China on human rights

WASHINGTON (AP) _ Vice President Joe Biden and Secretary of State Hillary Rodham Clinton launched high-level talks with the Chinese on Monday by pointedly criticizing Beijing's crackdowns on democracy advocates, arguing that long-term stability depends on respecting human rights.

At the same time, the world's two biggest economies clashed over America's massive trade deficit with China. Treasury Secretary Timothy Geithner said it would be in China's self-interest to allow its currency to appreciate at a faster rate and allow Chinese consumer interest rates to rise. The stronger yuan and higher Chinese interest rates would help boost domestic demand and help lower America's trade deficit, which hit an all-time high with China last year.

But a Chinese official blamed U.S. policies for the ballooning trade gap. Commerce Minister Chen Deming told a news conference that China's currency appreciation was being carried out in a "very healthy manner." He said the United States needed to change its own policies on high-tech sales and investment as a way to spur American manufacturing.

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Greece hit by new downgrade, EU ponders more help

LONDON (AP) _ Two major credit agencies signaled their concern about Greece's massive debt on Monday, lending new credence to the view that European authorities must do more to help the country a year after it barely avoided bankruptcy with a bailout.

Experts from the European Union and the International Monetary Fund were in Greece on Monday to check up on economic reforms the government promised to make in return for 110 billion euros ($160 billion) in rescue loans last year. They were also examining whether the current bailout is enough so Athens can stand on its own feet again when the loans run out in 2013 _ a scenario most investors think is unlikely.

Credit rating agency Standard & Poor's cut Greece's bond grade further into junk status Monday, saying it was increasingly likely that Greece would be given more time to repay its bailout loans and that Greece would negotiate a similar deal on bonds held by commercial investors. Moody's said it had placed Greece's credit rating on review for a further possible downgrade, citing the "increased uncertainty about the sustainability of Greek sovereign debt."

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ECB's Trichet: Rich countries must fix finances

BASEL, Switzerland (AP) _ Rich countries like the U.S., Japan and Britain need to move quickly to get their deficits under control, the head of the European Central Bank said Monday.

Speaking on behalf of the world's major central banks, Jean-Claude Trichet said governments' financial situation in the developed world "has to be aggressively improved."

Rich countries have seen debts and deficits rise due to the financial crisis, recession and bank bailouts. In Europe, Greece, Ireland and Portugal have needed international rescue loans to deal with their debt crises.

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Hertz boosts buyout offer for Dollar Thrifty

NEW YORK (AP) _ Hertz is raising the stakes in its pursuit of Dollar Thrifty Automotive Group Inc. in hopes of beating rival Avis' efforts to acquire the Oklahoma-based car rental agency.

The two vehicle rental heavyweights have been in a virtual tug-of-war over Dollar Thrifty for a little more than a year, with both looking to snag the Tulsa, Okla., company because its clientele is largely the leisure traveler. Hertz and Avis cater mostly to business travelers, so a Dollar Thrifty acquisition would automatically give either one a broader appeal.

Hertz Global Holdings Inc. sweetened the pot on Monday. Its new proposal is worth $72 a share in cash and stock. This includes $57.60 in cash and 0.8546 of a common share. With 31.2 million fully diluted shares of Dollar Thrifty, the Hertz bid is worth about $2.25 billion and 3.3 percent above Dollar Thrifty's closing price last week.

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Bair to leave FDIC in July, ending 5-year term

WASHINGTON (AP) _ Sheila Bair is stepping down as chairman of the Federal Deposit Insurance Corp. this summer, ending a five-year term in which she helped craft the government's response to the 2008 financial crisis.

Bair will leave her post as one of the government's top bank regulators on July 8, the FDIC said Monday.

Bair was among the first officials to raise concerns about the explosion in high-risk lending to borrowers with bad credit. Under her tenure, the agency closed 365 banks since the crisis began. That included Washington Mutual, the nation's largest bank failure.

The FDIC is charged with maintaining public confidence in the banking system. The agency guarantees bank deposits up to $250,000.

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McDonald's sales figure rises 6 percent in April

OAK BROOK, Ill. (AP) _ Sales of McDonald's shakes, coffee drinks and breakfast food helped revenue at its restaurants open at least 13 months rise 6 percent in April, the company said Monday.

Business was strongest overseas, with the figure rising 6.5 percent in Europe, Asia, the Middle East and Africa. U.S. growth of 4 percent was slower but still ahead of industry trends.

The figures are a snapshot of money spent on food at both company-owned and franchised restaurants and franchises. They do not reflect McDonald's corporate revenue, which consists of revenue at company-owned stores plus fees and rents paid by franchisees.

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Tyson reports steady 2Q profit; hikes meat prices

ST. LOUIS (AP) _ Tyson Foods said Monday that its second-quarter earnings were flat compared with last year, as higher feed costs offset improving demand and higher meat prices.

The company raised prices for chicken, beef and pork, indicating that higher global grain costs are finally working their way to the grocery store meat counter. Shell-shocked consumers have been slow to start spending again on restaurant meals and prepared foods, dragging down Tyson's sales.

Despite the profitable quarter, CEO Donnie Smith warned investors that the meat industry is still facing at least months of volatility. Higher gasoline prices could crimp consumer demand. At the same time, Tyson's profits could be squeezed by higher input costs. The company expects feed costs alone to be about $500 million higher during the second half of the fiscal year than in 2010.

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LinkedIn looking for $32 to $35 per share in IPO

NEW YORK (AP) _ Professional networking website LinkedIn Corp. hopes to sell its stock for $32 to $35 per share in an upcoming initial public offering. Its IPO may encourage other growing Internet services to make their stock market debuts during the next year.

The price target, set in a filing Monday with the Securities and Exchange Commission, signals that LinkedIn is nearly ready to complete its IPO. The shares are expected to be sold May 18, according to IPO analyst Scott Sweet. The stock would then begin trading under the ticker symbol of "LNKD" on the New York Stock Exchange.

The company's debut could offer a preview of investor demand for other popular online services that connect people with common interests. Although they haven't set timetables, Facebook, Twitter, the online deals site Groupon and the game maker Zynga are among the other social-networking services expected to go public.

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Officials investigate fuel tank problem on F-150s

DETROIT (AP) _ U.S. safety regulators are investigating a fuel tank problem that could affect more than 2.7 million Ford F-150 pickup trucks.

The National Highway Traffic Safety Administration said Monday that the steel straps holding up the truck's gas tank can rust and break, possibly causing a fuel spill and fire. No injuries have been reported from the possible defect.

The agency is looking into trucks from the 1997 through 2001 model years. NHTSA's investigations often lead to recalls.

NHTSA began looking at the fuel tank problem last year after it received 32 complaints. NHTSA and Ford have now received 243 reports of the tanks falling. In two incidents, a fire started when the fuel tank fell. One of the fires destroyed the pickup, while the other extinguished itself.

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By The Associated Press(equals)

The Dow Jones industrial average gained 45.94 points, or 0.4 percent, to 12,684.68. The S&P 500 added 6.09 points, or 0.5 percent, to close at 1,346.29. The Nasdaq composite index rose 15.69 points, or 0.6 percent, to 2,843.25.

Benchmark crude for June delivery rose $5.37, or 5.5 percent, to $102.55 a barrel in Monday trading on the New York Mercantile Exchange.

In London, Brent crude for June delivery was up $6.77, or 6.2 percent, to $115.90 a barrel on the ICE Futures exchange.

In other Nymex trading in June contracts, heating oil rose 11.61 cents, or 4.1 percent to $2.9618 a gallon and wholesale gasoline added 18.83 cents to $3.2784 a gallon. Natural gas futures fell 8.1 cents at $4.223 per 1,000 cubic feet.