Business Highlights

AP News
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Posted: Jun 06, 2013 5:39 PM

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US government collecting huge number of phone records

WASHINGTON (AP) — The government is secretly collecting the telephone records of millions of U.S. customers of Verizon under a top-secret court order, according to the chairwoman of the Senate Intelligence Committee. The Obama administration is defending the National Security Agency's need to collect such records, but critics are calling it a huge over-reach.

Sen. Dianne Feinstein, D-Calif., told reporters Thursday that the court order for telephone records, first disclosed by The Guardian newspaper in Britain, was a three-month renewal of an ongoing practice. The records have been collected for some seven years, according to Sen. Harry Reid, D-Nev.

And the chairman of the House Intelligence Committee, Republican Rep. Mike Rogers of Michigan, said the NSA search of telephone records had thwarted an attempted terrorist attack in the U.S. in the past few years. He said it was a "significant case" but declined to provide further details.

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AP survey: Economists see no stock market bubble

WASHINGTON (AP) — A debate is raging among investors and analysts: Has the Federal Reserve inflated a stock market bubble by driving interest rates to record lows?

The answer, according to economists surveyed by The Associated Press: No.

Three-quarters of the economists say stocks, which are at their lowest point in a month but are up 19 percent since November, aren't overvalued. Many point to strong corporate profits as justifying the surge in stock prices, which have more than doubled since bottoming in 2009.

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US regains wealth from recession, but not equally

WASHINGTON (AP) — America as a whole has regained all the household wealth it lost to the Great Recession and then some, thanks to higher stock and home prices.

The average household still has a long way to go.

U.S. household wealth jumped $3 trillion to $70 trillion in the January-March quarter this year, the Federal Reserve said Thursday. That topped the previous peak of $68 trillion in the third quarter of 2007, just before the recession began.

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US unemployment benefit applications fall to 346,000

WASHINGTON (AP) — The number of Americans seeking unemployment benefits fell 11,000 last week to a seasonally adjusted 346,000, a level consistent with steady job growth.

The Labor Department said Thursday that applications dropped from 357,000 the previous week, which was revised up from an initially reported 354,000. The less volatile four-week average rose 4,500 to 352,500.

Weekly applications are a proxy for layoffs. They have fallen 7 percent in the past six months and hit a five-year low of 338,000 in early May.

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Average rate on 15-year US mortgage above 3 percent

WASHINGTON (AP) — The average U.S. rate on a 15-year fixed mortgage rose above 3 percent this week for the first time in a year, while the rate on the 30-year fixed loan approached 4 percent.

Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan jumped to 3.91 percent from 3.81 percent last week. That's the highest since March 2012.

The rate on the 15-year loan rose to 3.03 percent from 2.98 percent. That's the highest since last May.

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Senate defeats Democratic, Republican loan plans

WASHINGTON (AP) — Interest rates on new student loans are likely headed higher after senators failed Thursday to advance proposals to keep them from doubling July 1.

Dueling measures in the Senate would have kept interest rates on some student loans from moving from 3.4 percent to 6.8 percent, although separate Republican and Democratic proposals each failed to win 60 votes needed on procedural votes. The failure means that unless lawmakers can find a rare bipartisan agreement, students are likely to face higher rates on new subsidized Stafford student loans this fall but enjoy greater certainty on the interest they will be expected to pay during the life of their loans.

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Chrysler to recall 630,000 SUVs worldwide

DETROIT (AP) — Just two days after refusing a government request to recall 2.7 million older-model Jeeps, Chrysler has decided to do two other recalls totaling 630,000 vehicles worldwide.

The automaker will recall more than 409,000 Jeep Patriot and Compass small SUVs across the globe from the 2010 and 2012 model years to fix air bag and seat-belt problems. It's also recalling 221,000 Jeep Wranglers worldwide from 2012 and 2013 to fix transmission fluid leaks, according to documents posted Thursday on the National Highway Traffic Safety Administration website.

In the Patriots and Compasses, a software error could cause late deployment of the side air bags and seat-belt tightening mechanisms, and that could cause injuries in rollover crashes. Dealers will repair the software at no charge starting in July.

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Retailers report modest gains for May

NEW YORK (AP) — In the latest sign that Americans are feeling better about the overall economy, stores across the country had a pickup in May sales.

An improving jobs picture, better housing market and stock market rallies have all led to consumer confidence reaching five-year highs. That has left Americans a bit more likely to reach into their pockets and spend, as monthly revenue reports released by national retailers on Thursday show.

Revenue at stores open at least a year — an industry measure of a store's health — rose 3.4 percent in May compared with the same month a year ago, according to a preliminary tally of 13 retailers by the International Council of Shopping Centers.

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Reynolds American launching revamped e-cigarette

RICHMOND, Va. (AP) — Reynolds American Inc. is launching a revamped version of its Vuse-brand electronic cigarette — which promises to give users the "perfect puff" — in Colorado, with its sights set on expanding nationally.

The expansion represents another push by a tobacco giant into the fast-growing business, a trend that is expected to continue.

The move announced Thursday by the owner of the nation's second-biggest tobacco company is its first statewide e-cigarette distribution and is the latest in an industry wide push to diversify beyond the traditional cigarette business, which has become tougher in the face of tax hikes, smoking bans, health concerns and social stigma.

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McDonald's courts night owls with breakfast items

NEW YORK (AP) — McDonald's is taking a small step toward offering breakfast items outside of its usual breakfast hours — at least if you're a night owl.

Starting this month, the fast-food chain says participating 24-hour restaurants in select locations will offer an "After Midnight" menu that includes its Egg McMuffin, Big Mac and Chicken McNuggets. Customers will be able to create "Midnight Value Meals," with either fries or hash browns as their side items, McDonald's says.

A mockup of the menu provided by the company showed an Egg McMuffin paired with French fries, next to the heading, "Dinner or Breakfast? Yes"

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By The Associated Press(equals)

The Dow Jones industrial average ended up 80.03 points at 15,040.62, a gain of 0.5 percent. The Standard & Poor's 500 index rose 13.66 points to 1,622.56, a gain of 0.9 percent. The Nasdaq composite index rose 22.58 points to 3,424.05, a gain of 0.7 percent.

Benchmark oil for July delivery gained $1.02 to finish at $94.76 a barrel. Brent crude, a benchmark for many international oil varieties, rose 57 cents to finish at $103.61 a barrel on the ICE Futures exchange in London.

Wholesale gasoline rose 3 cents to end at $2.85 a gallon. Heating oil added 2 cents to finish at $2.87 per gallon. Natural gas fell 17 cents to end at $3.83 per 1,000 cubic feet.