Fed survey: Economy falters in several US regions
WASHINGTON (AP) _ For the first time this year, the economy has slowed in several U.S. regions, burdened by high gas prices that have weakened consumer spending and crises in Japan that reduced manufacturing output.
All 12 of the Federal Reserve's bank regions grew this spring. But four of the regions suffered slower growth in April and May from earlier this year, according to a Fed survey released Wednesday.
It was the weakest survey since fall, when the Fed said two regions failed to grow at all. And it confirmed a slew of data that portray a national economy whose growth has faltered. Hiring has slowed, orders to factories have declined and home prices have fallen.
Fed banks in New York, Philadelphia, Atlanta and Chicago said growth weakened in those regions. By contrast, the Fed regions in Boston, Cleveland, Richmond, St. Louis, Minneapolis, Kansas City and San Francisco said growth there remained steady.
The Dallas region was the only one to report accelerating growth. That was mostly because of higher oil prices, which benefited the region's energy industry.
Delta boosts bag limit after soldiers complain
Reacting to public outcry, Delta says it will allow members of the military to check four bags for free.
The news came after two Army soldiers returning from Afghanistan complained in an online video that Delta charged their unit a total of $2,800 when some of them checked a fourth bag.
Delta Air Lines Inc. has long allowed three checked bags for active duty military members flying in coach, with charges beginning with a fourth bag. The soldiers said their travel orders allowed four bags.
More ads hit online TV as Web audiences grow
LOS ANGELES (AP) _ One of the rewards of watching TV online is not having to sit through as many commercials. Now the networks are chipping away at that little luxury.
CBS shows twice as many ads per show on its website as it did last year. The CW network shows four times as many. Dozens of shows from major cable networks now carry as many ads online as they do on TV. More shows will follow soon.
The online audience is still small compared with television, but it's growing. Networks hope that by showing more ads, they can make about as much money per viewer online as they do on the tube.
Oil rises as OPEC maintains production level
NEW YORK (AP) _ With their economies slowed by high energy costs, the U.S. and other countries were hoping that OPEC would raise production levels and bring down the price of oil.
The Organization of Petroleum Exporting Countries didn't come to the rescue, however. In a contentious meeting in Vienna on Wednesday, the 12-nation group failed to agree on new production targets. That sets the stage for higher prices for oil and gasoline later this year as global demand for oil rises faster than supplies.
Saudi Arabia lobbied for an increase in output, which likely would have likely lowered oil prices. But countries like Iran resisted, arguing that oil supplies are adequate to meet demand and current prices are appropriate.
Merchants beat bankers in Senate debit card vote
WASHINGTON (AP) _ Merchants triumphed over bankers in a battle for billions Wednesday as the Senate voted to let the Federal Reserve curb the fees that stores pay financial institutions when a customer swipes a debit card. It was murkier, however, whether the nation's consumers were winners or losers.
As a result of the roll call, the Fed will be allowed to issue final rules on July 21 trimming the average 44 cents that banks charge for each debit card transaction. That fee, typically 1 to 2 percent of each purchase, produces $16 billion in annual revenue for banks and credit card companies, the Fed estimates.
The central bank has proposed capping the so-called interchange fee at 12 cents, though the final plan could change slightly.
Victorious merchants said the lowered fees should let them drop prices, banks said they could be forced to boost charges for things like checking accounts to make up for lost earnings and each side challenged the other's claims. Consumer groups were not a united front, either: While the consumer group U.S. PIRG said consumers would benefit, the Consumer Federation of America took no formal stance but said it was concerned about what both industries might do.
Fitch to review US rating if no debt ceiling deal
WASHINGTON (AP) _ Fitch Ratings is warning that it might downgrade U.S. debt if lawmakers fail to increase the nation's borrowing limit before the government runs out of money.
The rating agency says it will put the debt on watch for a possible downgrade in early August, if lawmakers have not reached a deal. The Treasury Department says it will exhaust its stopgap measures to delay a default on Aug. 2.
While Fitch expects the debt ceiling to be increased, it says a default by the U.S. on its debt obligations would "imply a crisis of governance" and threaten the stability of the world financial system.
Target ups dividend; shareholders talk politics
NEW YORK (AP) _ Target Corp. raised its quarterly dividend Wednesday by 5 cents to 30 cents as it sought to placate investors after a 22 percent decline in its stock price this year.
The 20 percent dividend increase came the same day the retailer's executives faced shareholders at its annual meeting Wednesday, held at a store in Pittsburgh set to open next month.
Target's shares have declined as the discounter now sees most of its shoppers skipping the home decor and clothing aisles and just sticking to food and other staples.
CEO Gregg Steinhafel reiterated during the meeting that lingering economic pressures have shoppers still focusing on "value."
McDonald's sales climb, but gains weaken in May
OAK BROOK, Ill. (AP) _ Sales of McDonald's fruit and maple oatmeal and drinks like frozen strawberry lemonade pushed the fast-food chain's revenue at restaurants open at least 13 months up 3.1 percent in May.
Though that number would be enviable for many fast-food chains, it's a slowdown from the 4.8 percent the company recorded a year ago.
Some analysts had been expecting more: 3.6 percent, according to Jefferies & Co., and 3.8 percent, according to Stifel Nicolaus & Co. McDonald's stock rose 1 cent to close at $81.15 Wednesday.
By The Associated Press(equals)
The Dow Jones industrial average fell 21.87, or 0.2 percent, to 12,048.94. The Nasdaq composite slipped 26.18, or 1 percent, to 2,675.38. The Standard and Poor's 500 lost 5.38, or 0.4 percent, to 1,279.56.
Benchmark West Texas Intermediate for July delivery gained $1.65 to settle at $100.74 per barrel on the New York Mercantile Exchange. In London, Brent crude added $1.07 to settle at $117.85 per barrel on the ICE Futures exchange.
In other Nymex trading for July contacts, heating oil added 1.67 cents to settle at $3.0937 per gallon and gasoline futures fell by 1.32 cents to settle at $2.9787 per gallon. Natural gas rose 1.6 cents to settle at $4.847 per 1,000 cubic feet.