Business Highlights

AP News
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Posted: Apr 20, 2012 6:11 PM
Business Highlights

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After 4-month surge, gas prices start falling

NEW YORK (AP) _ The worst is over, for now: Gasoline prices are starting to fall.

After a four-month surge pushed gasoline to nearly $4 per gallon in early April, motorists and economists feared that gasoline prices might soar past all-time highs.

Instead, pump prices have dropped 6 cents over two weeks to a national average on Friday of $3.88. The decline in gas prices follows a recent drop in oil prices.

Experts say gasoline could fall another nickel or more next week. If that happens, it would be the first time since October 2009 that drivers would be paying less at the pump than they did the year before.

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Crises make automakers rethink lean parts supplies

DETROIT (AP) _ For the first time in more than 20 years, U.S. automakers are questioning a pillar of manufacturing: The practice of bringing parts to assembly lines right before they're used.

So called just-in-time deliveries have helped automakers save billions and run their factories more efficiently. But the approach also relies on an almost perfect supply chain. And twice in the last year, the system's weak links have been exposed.

An earthquake last March knocked out many Japanese parts makers, resulting in factory shutdowns and model shortages around the world. And last month, an explosion at a German chemical plant cut off supplies of a resin essential for car fuel lines. Without those parts, assembly lines could slow or grind to a halt within weeks, causing shortages of cars on dealer lots later this year.

The threat of a new shortage comes as U.S. auto sales are just getting healthy again. Carmakers are scrambling to find alternatives to the resin.

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Does giving antibiotics to animals hurt humans?

WASHINGTON (AP) _ The bacon you had for breakfast is at the center of a 35-year debate over antibiotics.

That's because the same life-saving drugs that are prescribed to treat everything from ear infections to tuberculosis in humans also are used to fatten the animals that supply the chicken, beef and pork we eat.

Farmers say they have to feed the drugs to animals to keep them healthy and meet America's growing appetite for cheap meat. Public health advocates argue that the practice breeds antibiotic-resistant germs in animals that can cause deadly diseases in people.

The U.S. government moved to ban the use of some of the drugs in animals in the 1970s, but the rule was never enforced. Then last week, the Food and Drug Administration outlined plans to phase out the use of antibiotics in farm animals for nonmedical purposes over three years.

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IMF's bid for funds just part of Europe's struggle

WASHINGTON (AP) _ When the International Monetary Fund meets this weekend, its top goal will be as simple as it is difficult: Get member nations to pledge many more billions in aid _ in case the IMF needs to rescue more European economies.

Yet even success would hardly inspire confidence in Europe's economy. It is, by all accounts, already in recession. And slowing economies elsewhere _ from China to Brazil to India _ may reduce the exports the continent needs to grow. European nations need faster growth to help lighten their debt loads.

All that is out of the IMF's control _ whether or not it receives pledges of further aid this weekend.

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UK twin brothers charged in stock-robot swindle

WASHINGTON (AP) _ U.S. investors thought they were buying access to a stock-picking robot named "Marl." Instead, they paid millions to teenage twin brothers in England who now face civil fraud charges for an alleged penny-stock swindle.

The robot didn't exist.

The stocks picked were companies that paid hefty fees to Alexander and Thomas Hunter, just 16 when the alleged scheme began in 2007, the Securities and Exchange Commission said Friday. As stock prices jumped, the Hunters' clients dumped their shares for a profit.

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GE 1Q profit falls 12 percent but tops estimates

NEW YORK (AP) _ General Electric's first-quarter net income topped Wall Street expectations on a strong performance from the conglomerate's industrial businesses.

GE said Friday that net income fell 12 percent to $3.03 billion, or 29 cents per share. Excluding charges, GE earned 34 cents in the quarter, a penny better than Wall Street estimates.

The industrial and financial giant said its primary manufacturing operation has rebounded after posting weak results following the global recession. Operating profit at its industrial businesses, which include transportation, health care and energy infrastructure, rose by 10 percent on a 14 percent gain in revenue.

That's an improvement from 2011, when GE was able to grow revenue in the industrial segment but operating profit remained flat.

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McDonald's meets expectations as profit jumps

NEW YORK (AP) _ McDonald's ever-evolving mix of affordable menu items and new offerings like Chicken McBites is helping the chain solidify its dominance in the fast-food industry.

The world's biggest hamburger chain said Friday that its net income rose 5 percent in the first quarter, in line with Wall Street expectations.

McDonald's Corp. said global sales rose 7.3 percent at stores open at least 13 months, driven by gains from all regions. The figure is a key metric because it excludes the impact of newly opened stores. For April the fast food chain expects the figure to increase another 4 percent.

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US Airways makes deals with 3 AMR unions

DALLAS (AP) _ US Airways has struck deals with unions at American Airlines to win their support for a possible merger of the two airlines.

The unions are angry that American is trying to cut jobs and labor costs while under bankruptcy protection. They represent 55,000 pilots, flight attendants and ground workers at American, the nation's third-largest airline

The unions can't force a merger on their own, but they can work with other creditors of American's parent company, AMR Corp., to persuade the bankruptcy judge to open the door to a deal.

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Hundreds of thousands may lose Internet access in July

WASHINGTON (AP) _ For computer users, a few mouse clicks could mean the difference between staying online and losing Internet connections this summer.

Unknown to most of them, their problem began when international hackers ran an online advertising scam to take control of infected computers around the world. In a highly unusual response, the FBI set up a safety net months ago using government computers to prevent Internet disruptions for those infected users. But that system is to be shut down.

The FBI is encouraging users to visit a website run by its security partner, http://www.dcwg.org , that will let them know if they're infected and explain how to fix the problem. After July 9, infected users won't be able to connect to the Internet.

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Disney studio chief quits after `John Carter' bomb

LOS ANGELES (AP) _ Disney movie studio boss Rich Ross is stepping down, a month after the family entertainment giant booked a huge loss on the mega-budget sci-fi movie "John Carter."

Ross, 50, had taken the job just two and a half years ago with a mission to cut costs and develop new hits. He had brought "High School Musical" and "Hannah Montana" to TV audiences as the former head of Disney Channels Worldwide.

But the studio's losses continued under Ross despite major restructuring efforts.

Disney booked a $200 million loss on "John Carter," a special-effects-laden movie based on the Edgar Rice Burroughs book series. The movie starring Taylor Kitsch had an estimated budget of $250 million, matching what 20th Century Fox spent on "Avatar."

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By The Associated Press(equals)

The Dow rose 65.16 points to close at 13,029.26. The S&P 500 added 1.61 points to 1,378.53. The Nasdaq composite index was down 7.11 points to 3,000.45.

Benchmark U.S. crude rose 78 cents to finish at $103.05 per barrel in New York, while Brent crude added 76 cents to end at $118.76 in London.

In other energy trading, heating oil rose a little more than 1 cent to finish at $3.14 per gallon, gasoline futures fell about a cent to end at $3.14 per gallon and natural gas rose 2 cents to finish at $1.93 per 1,000 cubic feet.