Top business story in `11: Europe financial crisis
NEW YORK (AP) _ Europe took the financial world on a stomach-churning ride in 2011.
The rising threat of default by heavily indebted European countries spread fear across financial markets and weighed on economies worldwide. As the year came to a close, banks and investors nervously watched Europe's political and financial leaders scramble to prevent the 17-nation eurozone from breaking apart.
Several of the other biggest business stories of the year highlighted the global economy's linkages: A British phone-hacking scandal shook the foundations of Rupert Murdoch's U.S.-based media empire; a nuclear disaster in Japan stymied auto plants in the U.S. and beyond; and the price of gasoline surged because of unrest in the Middle East and growing demand in Asia and Latin America.
The European financial crisis was chosen as the top business story of the year by business editors at The Associated Press. The sluggish U.S. economy came in second, followed by the death of Jobs.
Rise in home construction suggests a turnaround
WASHINGTON (AP) _ The depressed housing market has held the economy back for four years.
Home construction has finally begun a gradual comeback and should add to the nation's economic growth in 2011, a turning point in the recovery from the Great Recession.
The main reason appears to be a positive consequence of the weak economy: Apartments are being built almost twice as fast as two years ago. Renting is the only option for many people who have lost their jobs, their homes or both.
Builders in November broke ground on homes _ houses and apartments alike _ at an annual rate of 685,000, the government said Tuesday. That was a 9.3 percent jump from October and the fastest pace since April 2010.
Stocks soar on Europe hopes, strong housing starts
NEW YORK (AP) _ Encouraging signs out of Europe and a surprisingly strong report on the U.S. housing market drove the Dow Jones industrial average up more than 300 points Tuesday. It was the best day for stocks this month.
The Spanish government pulled off a successful debt auction and gauges of business and consumer confidence in Germany rose unexpectedly. Both helped ease worries about Europe's debt crisis. The dollar fell against the euro and U.S. government bond prices dropped as traders shifted money out of the safest assets.
Borrowing costs for the Spanish government plunged at an auction of short-term debt, a sign that bond buyers are more confident in the country's ability to pay them back.
Honda scrambles to revamp Civic
ROMULUS, Mich. (AP) _ Honda is scrambling to revamp its Civic just eight months after a new version hit showrooms, and critics say it's an admission that the compact car fell short in quality and handling.
The revamp, to come by the end of 2012, is rare because new models aren't usually overhauled for at least three years. Honda executives say they're simply trying to stay ahead in an increasingly competitive small-car market.
The move comes as small car sales are on the rise in the U.S., and more people choose them because of worries about gas prices and car payments. Compacts also are no longer the cramped econoboxes of the 1980s and 1990s, and they have many of the same amenities as larger cars.
Unemployment fell in 43 states in November
WASHINGTON (AP) _ Unemployment rates fell in 43 states in November, the most number of states to report such declines in eight years.
The falling state rates reflect the brightening jobs picture nationally. The U.S. unemployment rate fell sharply in November to 8.6 percent, the lowest since March 2009. The economy has generated 100,000 or more jobs five months in a row _ the first time that's happened since 2006, before the Great Recession.
Only three states reported higher unemployment rates in November, the Labor Department said Tuesday. Four states showed no change.
Nevada for the 18th straight month had the highest state unemployment rate: 13 percent. It was followed by California at 11.3 percent. North Dakota again enjoyed the lowest unemployment rate: 3.4 percent. It was followed by Nebraska at 4.1 percent and South Dakota at 4.3 percent.
Nike profit up 3 percent in 2Q
PORTLAND, Ore. (AP) _ Nike Inc.'s second-quarter profit rose 3 percent as strong demand and higher prices for its shoes, clothes and gear offset increased costs.
Nike, like many companies, has been coping with higher costs for materials, labor and freight. But the Beaverton, Ore., company has been able to defy many trends of the down economy as its popularity has driven strong sales and allowed it to raise prices without consumer backlash.
The world's largest athletic shoe and clothing company reported Tuesday after the market closed that it earned $469 million, or $1 per share, for the quarter that ended Nov. 30. That's up from $457 million, or 94 cents per share, in the same quarter last year.
Nike's total revenue increased 18 percent to $5.73 billion.
ConAgra 2nd quarter net income beats expectations
ATLANTA (AP) _ Food maker ConAgra Foods on Tuesday reported fiscal second quarter net income fell 15 percent but results beat expectations as the company raised prices to offset continuing higher prices.
ConAgra Foods Inc., like many food companies, is dealing with higher costs for ingredients, packaging and fuel and has raised its prices to offset those increases.
The results for the Omaha, Neb. company were better than analysts expected and ConAgra reaffirmed its fiscal 2012 guidance.
Fed proposes new, tougher rules for big banks
NEW YORK (AP) _ The Federal Reserve on Tuesday said the largest U.S. banks and financial companies should hold extra cash on their balance sheets to cushion themselves against financial crises.
The proposal by the chief U.S. banking regulator will affect banks with over $50 billion in assets. There are even stricter rules for companies with over $500 billion in assets such as JPMorgan Chase & Co., Goldman Sachs Group Inc. and Citigroup Inc.
Fed officials didn't give a timeline for when the rules will be implemented but said the final rules will be released only after the regulators will have a chance to incorporate comments from the public. The Fed is accepting comments for 90 days.
Holiday flying to fall slightly, trade group says
NEW YORK (AP) _ Fewer people will fly this holiday season, but flights will still be packed.
That's according to a forecast released Tuesday by the main trade group representing U.S. airlines. About 43.3 million travelers will fly on U.S. carriers over the three-week holiday period, a 1 percent decline from a year earlier, predicts Airlines for America. That works out to about 20,000 fewer people per day. The trade group attributes the decline to "lingering economic concerns" and high energy prices that are limiting would-be travelers' disposable income.
About 1.6 million to 2.3 million people are forecast to fly each day between Wednesday and the first week of January.
Trade group: Holiday shoppers step up buying
NEW YORK (AP) _ Shoppers came out again to seriously shop last week, after taking breather from a record spending spree over the Thanksgiving weekend, according to one measure
Sales at stores opened at least a year rose 3.4 percent for the week ended Saturday compared with the previous week, according to the International Council of Shopping Centers-Goldman Sachs Weekly Chain Store Sales Index, released Tuesday.
That follows two consecutive weekly declines, compared with the previous weeks, as shoppers took a break after a discount-fueled spending spree over the Thanksgiving weekend, the official start of the holiday shopping season.
Compared with a year ago, sales for the week rose 4.6 percent.
By The Associated Press(equals)
The Dow Jones industrial average rose 337.32 points, or 2.9 percent to close at 12,103.58. The Standard & Poor's 500 index gained 35.95 points, or 3 percent, to 1,241.30. The Nasdaq composite index rose 80.59, or 3.2 percent, to 2,603.73.
Benchmark crude on Tuesday rose $3.34, or 3.6 percent, to end the day at $97.22 per barrel in New York. Brent crude, which is used to price foreign oil that's imported by many U.S. refineries, rose $3.09, or 3 percent, to finish at $106.73 per barrel in London.
In other energy trading, heating oil rose 6.9 cents to finish at $2.8494 per gallon, and gasoline futures rose 8.96 cents to end at $2.5787 per gallon. Natural gas rose 3.2 cents to finish the day at $3.128 per 1,000 cubic feet.