Business Highlights

AP News
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Posted: Mar 16, 2012 5:39 PM
Business Highlights

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Fans, entrepreneurs among first buyers of new iPad

MADISON, Wis. (AP) _ Apple's latest iPad drew the customary lines of die-hard fans looking to be first and entrepreneurs looking to make a quick profit.

Many buyers lined up for hours, and in some cases overnight, as the tablet computer went on sale in the U.S. and nine other countries. They did so even though Apple started accepting online orders a week ago.

The new model comes with a faster processor, a much sharper screen and an improved camera, though the changes aren't as big as the upgrade from the original model to the iPad 2.

As with the previous models, prices start at $499 in the U.S.

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US consumer prices up because of higher gas costs

WASHINGTON (AP) _ A sharp jump in gas prices drove a measure of U.S. consumer costs up in February. But outside higher pump prices, inflation stayed mild.

The Labor Department said Friday that the consumer price index rose 0.4 percent in February, the largest increase in 10 months. Gas prices rose 6 percent to account for most of the gain.

Food prices were unchanged for the first time in 19 months. And excluding food and energy, so-called "core" prices rose just 0.1 percent.

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US factory output rose modestly in February

WASHINGTON (AP) _ U.S. factories stepped up production in February for the third straight month, helping the economy recover and driving the best job growth since the recession ended.

The Federal Reserve said Friday that the output of the nation's factories rose 0.3 percent last month. That followed even stronger increases in January and December, which combined for the best two-month stretch since 1998.

Manufacturers made more electronics, energy products and electrical equipment in February. Auto production declined after two big months of growth.

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CBO: Obama budget produces 2013 deficit of $977 billion

WASHINGTON (AP) _ A new analysis of President Barack Obama's budget for next year says the deficit scenario for next year isn't as rosy as the White House figured last month.

Friday's Congressional Budget Office report said Obama's budget would produce a $977 billion deficit next year _ $75 billion more than predicted by the White House.

Over the coming decade, CBO says Obama's policies would result in deficits totaling $6.4 trillion. Deficits would be even higher were it not for Obama's proposals to raise taxes on higher-income people.

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Goldman to review rules on conflicts of interest

NEW YORK (AP) _ Goldman Sachs, the investment bank blistered by a resigning employee this week for how it does business, said Friday that it will try to strengthen internal rules to prevent questions about conflicts of interest.

A Delaware judge almost killed a deal between two energy companies last month because Goldman had ties to both parties: The bank collected a fee for advising one company, and a Goldman banker owned stock in the other.

Goldman was stung Wednesday by an Op-Ed article published in The New York Times by a young banker who was quitting the company. He accused Goldman executives of privately insulting clients and not acting in customers' best interest.

The bank did not offer specifics Friday on the review of its policies.

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Direct Air parent files for bankruptcy protection

NEW YORK (AP) _ Just three days after abruptly stopping service and leaving travelers stranded, the parent of discount airline Direct Air has filed for bankruptcy protection.

Southern Sky Air & Tours LLC late Thursday filed for Chapter 11 protection in Massachusetts. Court documents show the company has between $10 million and $50 million in debt and just $500,000 to $1 million in assets. The company has not yet filed several documents required by the court as part of the bankruptcy filing process, including a list of its top 20 creditors. The airline said it has 100 to 200 creditors, which could include everything from fuel suppliers to airports.

The airline abruptly stopped flying Monday afternoon _ at the peak of the spring break travel season _ apparently because it couldn't pay its fuel bills. Direct Air, based in Myrtle Beach, S.C., says it will not fly again until May 15. Ticket holders were told to contact their credit card companies for refunds.

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Chinese state TV targets McDonald's, Carrefour

BEIJING (AP) _ Chinese state television has accused McDonald's and French retailer Carrefour of selling expired chicken products in separate incidents amid public anxiety in China over food safety.

McDonald's Corp. and Carrefour Inc. issued public apologies Friday and said they were investigating the report by China Central Television.

The report Thursday said a McDonald's restaurant in Beijing sold chicken wings 90 minutes after they were cooked while the company's rules set a 30-minute limit. It said employees at a Carrefour store in the central city of Zhengzhou changed expiration dates on some chicken and sold regular chickens as more expensive free-range birds.

Food safety is a sensitive issue in China, which has been rocked by scandals ranging from deadly infant formula to chemical-laced pork and recycled restaurant oil.

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UPS says TNT talks continue, plans bid

AMSTERDAM (AP) _ U.S. delivery company United Parcel Service Inc. says it is still in talks to buy Dutch-based TNT Express NV and plans a formal bid by May 12.

TNT, Europe's second-largest express delivery company, rejected an "informal" offer by UPS of (EURO)9 per share on Feb. 17, which valued the company at around $6.4 billion ((EURO)4.9 billion). TNT shares opened Friday at (EURO)9.229.

The talks were disclosed on the eve of TNT reporting a large fourth quarter loss.

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Sprint ends deal with LightSquared

OVERLAND PARK, Kan. (AP) _ Wireless carrier Sprint Nextel Corp. ended its spectrum hosting agreement with start-up LightSquared, whose network looks doomed because regulators say it interferes with GPS navigation devices.

Sprint is returning $65 million in prepayments to LightSquared.

The deal between the companies had called for Sprint to collaborate with LightSquared on its LTE, or long-term evolution, network. Sprint said Friday that LightSquared has so far been unable to find a way to resolve interference issues.

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By The Associated Press(equals)

The Dow Jones industrial average fell 20.14 points to 13,232.62. The Nasdaq fell 1.11 points to 3,055.26. The broader S&P 500 index edged up 1.57 points to 1,404.17.

Benchmark oil for April delivery rose $1.95, or about 2 percent, to finish at $107.06, the biggest gain since Feb. 24. Brent crude for May delivery rose $3.21, or 2.6 percent, to end at $125.81 per barrel on the ICE Futures exchange in London.

Natural gas, which is trading at prices not seen since 2002, rose 4.7 cents to finish at $2.326 per 1,000 cubic feet.

Heating oil rose 5.94 cents to end at $3.2819 per gallon and gasoline futures gained 6.84 cents to finish at $3.3569 per gallon.