Going nowhere: Economy struggles to find footing
WASHINGTON (AP) _ Shoppers won't shop. Companies won't hire. The government won't spend on economic stimulus _ it's cutting instead. And the Federal Reserve is reluctant to do anything more.
Without much to invigorate growth, the economy may be in danger of slipping into a stupor like the one Japan has failed to shake off for more than a decade. And Wall Street is spooked.
The Dow Jones industrial average Wednesday barely broke an eight-day losing streak, finishing up about 30 points. A nine-day losing streak would have been the Dow's first since February 1978.
Even with the gain, the Dow has fallen 828 points, or 6.5 percent, over the past nine trading days. Investors didn't even pause to celebrate the resolution over the weekend of a dangerous debt standoff in Washington.
Stunned by news last week that the economy barely grew in the first half of 2011, economists are lowering their forecasts for the full year and recalculating the odds that the economy will slide back into recession.
Service firms expand at slowest pace in 17 months
WASHINGTON (AP) _ Service businesses such as restaurants, hotels and financial companies experienced their weakest growth in 17 months in July.
The report Wednesday from the Institute for Supply Management confirms other data that show the economy is struggling two years after the recession officially ended.
The trade group of purchasing executives said its index for services companies fell to 52.7, from 53.3 in June. Any reading above 50 indicates expansion.
Unemployment rose in nearly all US cities
WASHINGTON (AP) _ Unemployment rates rose in more than 90 percent of U.S. cities in June, mirroring a national slowdown in hiring.
The Labor Department said Wednesday that unemployment rates rose in 345 large metro areas. They dropped in 20 cities and were unchanged in seven. That's worse than May, when rates rose in only 210 cities. And it is a sharp reversal from April, when unemployment rates fell in nearly all metro areas.
The biggest increase was in Joplin, Mo., which was hit by a major tornado on May 22. The city lost 9,400 jobs in June, and the unemployment rate jumped nearly 2 percentage points, to 9.6 percent.
The national unemployment rate ticked up to 9.2 percent in June, the highest level this year.
Dunkin' Donuts eyes Europe, afternoon pick-me-ups
NEW YORK (AP) _ Dunkin' Brands Group Inc., which reported flat earnings on Wednesday after becoming a public company a week earlier, said it plans to rejuvenate the struggling Baskin-Robbins brand in the U.S. and expand its Dunkin' Donuts chain in Europe.
Dunkin' Donuts' U.S. revenue grew 6.3 percent over the year, helped by the success of new stores. But the U.S. division of Baskin-Robbins, hurt by rising dairy costs, was the only unit to lose revenue over the year, with a decrease of nearly 6 percent.
Nigel Travis, who's been CEO since early 2009, told analysts on Wednesday that he largely had been focusing on the Dunkin' Donuts U.S. brand, which makes up about 70 percent of the company's revenue. The brand, which has been in a fight with Starbucks and McDonald's Corp. for the loyalty of coffee drinkers in an increasingly competitive market, opened more new U.S. locations last year than any restaurant except Subway.
Clorox fourth-quarter net income dips on increasing costs
NEW YORK (AP) _ Prices on Clorox products from bleach to salad dressing are about to go up, the company said Wednesday, explaining that's how it plans to cope with the double challenge of nervous consumers and rising prices for raw materials.
Clorox Co. was reporting quarterly results it characterized as encouraging _ a 4 percent increase in revenue but a 1 percent drop in net income, both better than analysts expected for the period that ended June 30.
Executives declined to tackle the lingering question at the top of investors' minds: Carl Icahn's takeover bid.
The billionaire investor has offered twice since mid-July to buy the company, first at $76.50 per share and then at $80 per share. The company _ whose shares fell $1.41, or 2 percent, on Wednesday to close at $68.88 _ rejected him both times.
CEO Don Knauss would only reiterate during a conference call to discuss the earnings report that Icahn's bids were not credible and undervalued the company.
MasterCard posts 33 percent profit increase
NEW YORK (AP) _ U.S. shoppers kept on using their MasterCards in July even as uncertainty about the economy increased.
Spending with credit and debit cards bearing the company's logo rose about 12 percent in the U.S. compared with July 2010, Chief Financial Officer Martina Hund-Mejean of MasterCard Inc. said Wednesday.
About 2 points of that increase came from gasoline prices, which averaged about $1 per gallon higher than a year ago. Inflation also played a part in higher clothing and food costs, and more expensive luxury items due to record prices for gold and silver, she said.
Other increases came from expanding fees and surcharges that airlines charge, and increased spending in restaurants and hotels, the CFO said during an interview.
Spending was slowing down at this time a year ago.
Overdraft fees remain steep at largest banks
NEW YORK (AP) _ The country's largest banks are still charging steep overdraft fees.
A survey released by the Consumer Federation of America finds that the median overdraft fee is $35, which is unchanged from last year. The highest fees also remain $33 to $37 per overdraft.
The fees for nonsufficient funds can be triggered if customers overdraw their accounts by as little as $5. In addition, the survey found that two-thirds of banks continue piling on fees if customers fail to balance their accounts within a set time.
The findings come a year after a new regulation required banks to obtain consent before enrolling customers in overdraft programs. Previously, it was industry practice to automatically enroll customers without giving them a way to opt out.
New touch-screen BlackBerrys being launched
NEW YORK (AP) _ Research In Motion Ltd. on Wednesday unveiled five new BlackBerry phones with touch screens, as it hopes to revive the line's dwindling appeal in the face of competition from the iPhone and Android smartphones.
The new phones had been expected earlier this year, but were delayed. Though the company is profitable and seeing growing sales, it is increasingly seen as a has-been that missed the chance to parlay the BlackBerry's popularity as a corporate email device into mass-market dominance.
RIM, which is based in Waterloo, Ontario, is updating its high-end Bold models to include touch screens. It's also launching two Torch models with big screens but no physical keyboards, mimicking the basic design of the iPhone.
RIM launched a keyboard-less touch-screen phone called the Storm in 2008, more than a year after the first iPhone, but the Storm's quirky design and poor software made it a flop.
Budweiser can redesigned
ST. LOUIS (AP) _ Budweiser is getting a new look as its parent company tries to revive weak sales in the U.S.
Anheuser Busch unveiled a bolder, sleeker design for its cans Wednesday that puts a heavy emphasis on the "bowtie" design it has made a focus in recent marketing.
It's the 12th redesign since Anheuser-Busch began offering Budweiser in cans in 1936.
The new cans will appear in the U.S. in coming weeks and in other countries later this year as the brewer tries to build the iconic U.S. brand's sales in emerging markets.
By The Associated Press(equals)
The Dow Jones industrial average finished with a gain of 0.3 percent, to 11,896.44. The S&P 500 index rose 6.29, or 0.5 percent, to 1,260.34. The Nasdaq composite added 23.83, or 0.9 percent, to 2,693.07.
Benchmark West Texas Intermediate crude dropped $1.86 to settle at $91.93 a barrel on the New York Mercantile Exchange. In London, Brent crude fell $3.23 to settle at $113.23 per barrel on the ICE Futures exchange.
In other Nymex trading for September contracts, heating oil fell 7.27 cents to settle at $3.0189 per gallon, gasoline futures lost 10.6 cents to settle at $2.9313 per gallon and natural gas dropped 6.5 cents to settle at $4.090 per 1,000 cubic feet.