Business Highlights

AP News
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Posted: Feb 28, 2012 5:57 PM
Business Highlights

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Dow closes above 13,000, first time since crisis

The Dow Jones industrial average on Tuesday reclaimed the last of the ground it held before the carnage of the Great Recession _ bailouts, bank failures, layoffs by the million and a stock market panic that cut retirement savings in half.

The Dow closed above 13,000 for the first time since May 19, 2008, almost four months before the fall of the Lehman Brothers investment bank triggered the worst of the financial crisis.

It just cleared the mark _ 13,005.12, up 23.61 points for the day.

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Americans feeling better about economic recovery

NEW YORK (AP) _ Americans are feeling better about the economy again, but will it last?

A widely watched barometer of consumer confidence surged in February to its highest level in a year as Americans took note of improving job prospects among friends and family and falling unemployment, which is now at a three-year low.

The brighter assessment released Tuesday by a private research group reflected a more upbeat attitude for the nation generally as the economy picks up. That is a boon for President Obama as he seeks re-election. Polls, including a recent Associated Press-GfK survey, show the Democratic incumbent is beginning to benefit politically from improved views of the economy.

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Gas hits $3.72 per gallon, up 30 cents in month

NEW YORK (AP) _ The price of gasoline rose for the 21st straight day on Tuesday. Drivers are now paying an average of $3.72 a gallon nationwide, about 24 cents more than before the streak began.

The winter surge is being driven primarily by the rising price of oil, which has been above $100 a barrel since Feb. 10 as tensions mount between the West and Iran over its nuclear ambitions.

Gas prices are highest in Alaska, California, New York, Connecticut and Hawaii, which is tops at $4.32 a gallon. Nationwide, gasoline prices are 10 percent higher than a year ago _ and at their highest level ever for the end of February.

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Cruise line: Crippled ship to reach land Thursday

NAIROBI, Kenya (AP) _ Helicopters ferried food, phones and flashlights Tuesday to more than 1,000 passengers and crew stuck aboard a disabled cruise ship that was being towed to the Seychelles Islands through waters prowled by pirates.

Those aboard the Costa Allegra, a sister ship of the cruise liner that capsized off Italy last month, faced more stifling days and nights before the vessel docks in the tropical paradise.

The stricken liner was expected to reach the main Seychelles island of Mahe on Thursday, the Italian cruise operator said.

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FDIC: Bank earnings hit five-year high in 2011

WASHINGTON (AP) _ U.S. banks are coming off their most profitable year since 2006, a sign that many have put the financial crisis behind them.

The surge in bank earnings came largely because banks suffered fewer losses _ not because they took in more money. The slow recovery, record-low interest rates and weak demand for loans left bank revenue mostly flat for the year.

The Federal Deposit Insurance Corp. said Tuesday that bank earnings rose in the October-December quarter to $26.3 billion.

And for the entire year, earnings rose to $119.5 billion. That's 40 percent higher than the previous year and the most since 2006.

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Home prices fell in December in most US cities

WASHINGTON (AP) _ Home prices fell in December for a fourth straight month in most major U.S. cities, as modest sales gains in the depressed housing market have yet to lift prices.

The Standard & Poor's/Case-Shiller home-price index shows prices dropped in December from November in 18 of the 20 cities tracked. The steepest declines were in Atlanta, Chicago and Detroit. Miami and Phoenix were the only cities to show an increase.

The declines partly reflect the typical slowdown that comes in the fall and winter.

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Durable goods orders drop by most in 3 years

WASHINGTON (AP) _ Businesses slashed spending on machinery and equipment in January after a tax break expired, pushing orders for long-lasting manufacturing goods down by the largest amount in three years.

Orders for durable goods fell 4 percent last month, the Commerce Department said Tuesday.

A big reason for the decline was that demand for so-called core capital goods, viewed as a good measure of business investment plans, tumbled 4.5 percent. That's the biggest drop in a year.

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GM likely to spend $500 million on employee payments

DETROIT (AP) _ General Motors is likely to spend more than $500 million on employee bonuses and profit-sharing based on the company's performance last year.

GM, which made a record profit in 2011, will pay bonuses of at least $182 million to white-collar workers such as engineers, car designers and managers on Wednesday, according to a formula obtained by The Associated Press. That's on top of $332.5 million in profit-sharing it already agreed to pay factory workers.

In the past, such payments have drawn criticism from those who believe the government shouldn't have bailed out GM and Chrysler. But GM, which made a record $7.6 billion last year, says the payments are needed to hold on to skilled employees. It's also keeping fixed costs down by giving bonuses instead of annual pay raises.

The bonuses will go to most of the company's 26,000 salaried employees, many of whom make more than $100,000 a year. The bonuses will range from 8 percent of base pay to 14 percent, according to the formula.

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Yahoo seeking patent windfall from Facebook

SAN FRANCISCO (AP) _ Yahoo is threatening to sue Facebook unless the Internet social network agrees to license some of its patents covering a variety of online services.

The demand, issued in a statement on Monday, presents Facebook Inc. with an annoying headache as it tries to complete an initial public offering of stock.

The upcoming IPO helps explains why Yahoo decided to assert its patent rights now. Facebook may be more likely to work out a licensing agreement rather than risk the specter of a legal battle dampening investor enthusiasm for its eagerly anticipated IPO.

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Apple expected to unveil iPad 3 at event next week

NEW YORK (AP) _ Apple is expected to unveil a new version of the iPad at an event in San Francisco next week.

Apple sent out invitations to news media on Tuesday with an image showing part of an iPad screen. The company had been widely expected to reveal the third version of its popular tablet computer soon, close to the anniversary of the launch of the iPad 2.

The event will take place next Wednesday at the Yerba Buena Center for the Arts Theater, where Apple holds larger launch events.

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By The Associated Press(equals)

The Dow Jones industrial average rose 23.61 points to close at 13,005.12. The S&P 500 gained 4.59 points for the day and closed at 1,372.18. The Nasdaq gained 20.60 and closed at 2,986.76.

West Texas Intermediate, used to price oil produced in the U.S., dropped $2.01, or nearly 2 percent, to $106.55 a barrel. Brent fell $2.62, or 2.1 percent, to $121.55 a barrel.

Heating oil fell by 6.26 cents to end the day at $3.2238 per gallon on the NYMEX and gasoline futures fell by 8.82 cents to finish at $3.0401 per gallon. Natural gas futures lost 8.4 cents to end at $2.5190 per 1,000 cubic feet.