Stock market rebounds from worst day of the year
NEW YORK (AP) — Strong housing and earnings reports helped stocks rebound from their worst day of the year.
The Dow Jones industrial average rose 157.58 points, or 1.1 percent, on Tuesday, to 14,756.78, winning back more than half of the 265 points it lost a day earlier. The Standard & Poor's 500 index logged its second-best day of the year.
Home construction topped 1 million last month, the highest level since June 2008. Robust earnings from companies including Coca-Cola also propelled the market higher.
US housing starts surpass 1 million in March
WASHINGTON (AP) — U.S. homebuilders broke the 1 million mark in March for the first time since June 2008. The gain signals continued strength for the housing recovery at the start of the spring buying season.
The overall pace of homes started rose 7 percent from February to March to a seasonally adjusted annual rate of 1.04 million, the Commerce Department said Tuesday.
Apartment construction, which tends to fluctuate sharply from month to month, led the surge. It jumped nearly 31 percent to an annual rate of 417,000, the fastest pace since January 2006.
China's struggle to measure economy clouds outlook
BEIJING (AP) — After China reported quarterly economic growth of 7.7 percent this week — far above anemic U.S. and European performance — global markets reacted by falling, wiping billions of dollars off stock prices.
The reason? Growth came in under the 8 percent expected by private sector forecasters who relied on Chinese trade and other data.
The market plunge highlighted complaints about the possible inaccuracy of Beijing's official data and the intense, possibly excessive importance traders attach to a handful of Chinese economic indicators.
What matters more than a difference of a few tenths of a percentage point in growth from quarter to quarter is whether Chinese leaders are allowing the private sector to flourish by reducing the role of state industry in the economy, said Ben Simpfendorfer, managing director of Silk Road Associates, a consulting firm in Hong Kong.
IMF cuts its forecast for global economy in 2013
WASHINGTON (AP) — The International Monetary Fund has lowered its outlook for the world economy this year, predicting that government spending cuts will slow U.S. growth and keep the euro currency countries in recession.
The international lending organization cut its forecast for global growth to 3.3 percent this year, down from its January forecast of 3.5 percent. It left its prediction of 4 percent global growth in 2014 unchanged.
The IMF expects the U.S. economy to expand 1.9 percent this year. That's below its January estimate of 2.1 percent. Still, the IMF says the U.S. economy is improving and should expand 3 percent in 2014. U.S. job growth has accelerated, the housing market is recovering and banks are more willing to lend.
The IMF predicts that the 17-country eurozone will shrink 0.3 percent in 2013 and grow only 1.1 percent in 2014.
Feds in NY: Russian mob ran celebrity poker games
NEW YORK (AP) — Dozens of people were charged on Tuesday in what investigators said was a Russian organized crime scheme that included illegal, high-stakes poker games for the rich and famous.
Federal authorities in New York City weren't naming names, but they said the poker players included pro athletes, Hollywood celebrities and Wall Street executives. None of them were facing charges.
The money-laundering investigation led to arrests Tuesday in New York, Los Angeles, Miami and elsewhere around the country. There also were FBI raids at an apartment in Trump Tower on Fifth Avenue and a Madison Avenue art gallery owned by two of the defendants.
American Airlines fixes computers, delays go on
DALLAS (AP) — American Airlines says it fixed an outage in its main reservations system that disrupted travel for thousands of passengers whose flights were delayed or canceled.
American Airlines spokeswoman Stacey Frantz said Tuesday that the system was fixed by 4:30 p.m. EDT. But the airline expects to see flight delays and cancellations into the evening.
Tracking service FlightAware says that as of mid-afternoon, American canceled more than 700 flights and another 765 flights are delayed.
US consumer prices drop 0.2 percent on cheaper gas
WASHINGTON (AP) — U.S. consumer prices declined last month as the cost of gas fell sharply and food prices were unchanged. The tame reading is the latest evidence that the sluggish economy is keeping inflation in check.
The consumer price index declined a seasonally adjusted 0.2 percent in March, after jumping 0.7 percent in February, the Labor Department said Tuesday. Gas prices fell 4.4 percent, reversing part of February's 9.1 percent gain.
The figures come a day after the prices of many commodities, including copper and oil, fell after a report of slower-than-expected growth in China. That suggests U.S. consumer prices will likely stay low in the coming months.
Cars, utilities lift US industrial output in March
WASHINGTON (AP) — U.S. industrial output rose in March as cold weather kept utilities busy generating heat and a surge in auto production helped offset broader weakness in manufacturing.
Production at the nation's factories, mines and utilities rose 0.4 percent in March from February, the Federal Reserve said.
Utility output rose 5.3 percent, as Americans had to use more heat during a colder-than-normal March.
Goldman CFO: Still 'very close' to crisis
NEW YORK (AP) — Goldman Sachs reported what seemed like a good first quarter, but analysts were more concerned about the bank's future than the past three months. They peppered the chief financial officer with questions about impending regulations, and investors sent Goldman's stock down even as other banks rose.
By the numbers, it was a decent quarter. Profit rose 5 percent and revenue was up 1 percent. Both beat analysts' expectations. Bond underwriting soared 69 percent as issuers rushed to take advantage of low interest rates and a hearty appetite for corporate debt among investors. CEO Lloyd Blankfein described the results as "generally solid."
Goldman's leaders sounded a cautious tone on a conference call with analysts, however. They said investors were still nervous about the economy and that the bank would continue to focus on controlling costs.
GM 1Q global sales rise 3.6 percent to beat Volkswagen
DETROIT (AP) — General Motors edged out fast-growing Volkswagen in first-quarter sales as both companies try to close the gap with Toyota for the global world sales crown.
Toyota, which is scheduled to release first-quarter numbers next week, dethroned GM to retake the top spot in 2012, a year in which VW posted record sales and came within 190,000 vehicles of beating GM.
GM said Tuesday that it sold 2.36 million cars and trucks around the world from January through March, an increase of 3.6 percent over the first quarter of last year. VW global sales rose 5 percent to 2.27 million vehicles, but the company cautioned that markets outside North America and China, particularly in Europe, "are becoming even more difficult."
By The Associated Press(equals)
The Dow Jones industrial average rose 157.58 points, or 1.1 percent, on Tuesday, to 14,756.78. The S&P 500 climbed 22.2 points, or 1.4 percent, to 1,574.57. The Nasdaq composite rose 48.14 points, or 1.5 percent, to 3,264.63.
Benchmark crude settled at $88.72 per barrel on the New York Mercantile Exchange, up 1 cent. Brent crude, which is used to price oil used by many U.S. refiners to make gasoline, fell 72 cents to finish at $99.91 a barrel on the ICE Futures exchange in London.
Wholesale gasoline rose 2 cents to end at $2.78 a gallon. Heating oil dropped 2 cents to finish at $2.81 a gallon. Natural gas rose 2 cents to end at $4.16 per 1,000 cubic feet.