AP
Business Highlights
Tuesday
January 27, 6:48 pm ET
Cuomo subpoenas Thain
over Merrill bonuses
Thain,
53, was serving as the head of the newly combined company's wealth management
division before he resigned last week. The resignation came shortly after
reports surfaced that billions of dollars were paid to Merrill executives in
late December.
Those bonuses were paid as Merrill was about to report a $15
billion fourth-quarter loss, and while Bank of
Geithner
announces new lobbying rules for bailout
WASHINGTON (AP) -- Treasury Secretary Timothy Geithner,
in his first full day on the job, announced new rules Tuesday to limit
special-interest influence on the government's $700 billion financial rescue
program.
The new rules are designed to crack down on lobbyist influence
over the rescue program and make sure that political clout in not a factor in
awarding rescue money.
Obama administration officials said they go farther than the
lobbying rules imposed by the Bush administration and are
designed to ensure that bailout money is distributed with the goal of promoting
the health and stability of the financial system.
Economic mood darkens as more jobs vanish
NEW YORK (AP) -- Americans' mood about the economy darkened
further in January, sending a widely watched barometer of consumer sentiment to
a new low, a private research group said Tuesday, as people worry about their
jobs and watch their retirement funds dwindle.
The Conference Board said its Consumer Confidence Index edged
down to 37.7 from a revised 38.6 in December, lower than the reading of 39 that
economists surveyed by Thomson Reuters had expected. In recent months the index
has hit its lowest troughs since it began in 1967, and is hovering at less than
half its level of January 2008, when it was 87.3.
Home prices tumble at record rate in November
NEW YORK (AP) -- Home prices tumbled by the sharpest annual rate
on record in November as the deepening housing slump and national recession
spared no region, according to a closely watched index released Tuesday.
But the silver lining might be that more families can finally buy
a home for the first time in years. Falling home prices coupled with lower
interest rates have shaved hundreds of dollars off monthly mortgage payments,
and that is luring buyers back into the market, new data this week showed.
The Standard & Poor's/Case-Shiller
20-city housing index tumbled by a record 18.2 percent from November 2007, the
largest decline since its inception in 2000. The 10-city index dropped 19.1
percent, tied with October for the biggest drop in its 21-year history.
Stocks rise following US Steel, Amex earnings
The market had its second straight moderate advance Tuesday,
rising after companies including United States Steel Corp. and American Express
Co. managed to post profits in a difficult recession. Financial stocks that
were mostly higher also lent support to the market.
The major indexes briefly stumbled after the Conference Board
said its Consumer Confidence Index in January slipped to its lowest level since
the reading's inception in 1967. The report indicated that consumers, who have
already cut back drastically, are likely to remain reluctant to spend in the
coming months. The index from the private research group slipped to 37.7 in
January from a revised 38.6 in December.
Under pressure, Citigroup cancels new jet order
Under pressure from President Barack Obama, one of the nation's
largest banks reversed course, announcing that it will not take delivery of the
jet it had planned to purchase before the credit crisis unfolded.
The canceled deal came as many politicians voiced concern about
how banks are spending government bailout money.
The White House reached out to Citigroup on Monday to reiterate
Obama's position that such jets are not "the best use of money at this
point," calling them "outrageous" spending for a company getting
taxpayer dollars, said a White House official who spoke on condition of
anonymity because the official was describing private conversations.
TAMPA, Fla. (AP) -- On the day a Florida hedge fund manager
surrendered to face federal securities and wire fraud charges, authorities
disclosed what may have set in motion his two weeks on the lam: A partner
concerned about the health of their funds after the Bernard Madoff
scandal was pressuring him to have their books audited by an independent
accountant.
It's not yet clear where Arthur Nadel
was during his time on the run, but he peacefully surrendered to authorities
with two lawyers in tow in
Nadel,
who was due to pay investors $50 million when he disappeared, was chained at
the waist and wrists when he appeared in court later Tuesday.
Regulators on defensive over Madoff
WASHINGTON (AP) -- Government and industry regulators were put
sharply on the defensive Tuesday at a Senate hearing over their failure to
uncover the more than a decade-long, multibillion-dollar fraud scheme allegedly
carried out under their noses by Bernard Madoff.
With charities and residents in their states ruined by losses
from Madoff, members of the Senate Banking Committee
demanded answers and accountability. They were scarcely satisfied with
explanations given by two high-ranking officials of the Securities and Exchange
Commission and the interim CEO of the securities industry's self-policing
organization.
And they said the Madoff affair clearly
showed the need for an overhaul of the patchwork system governing regulation of
the financial markets -- something the new Congress appears to be moving
toward.
DuPont posts 4Q loss, trims 2009 forecast
DOVER, Del. (AP) -- Chemical maker DuPont Co. reported a $629
million loss for the fourth-quarter Tuesday due to lower sales and a hefty
restructuring charge, and cut its earnings forecast for 2009.
The Wilmington-based company said its loss for the quarter
amounted to 70 cents per share, compared with a profit of $545 million, or 60
cents per share, a year ago. Excluding a charge of $380 million, or 42 cents
per share, from a previously announced restructuring program, the fourth
quarter loss was $249 million, or 28 cents per share.
Analysts surveyed by Thomson Reuters, on average, expected a
smaller loss of 24 cents a share. The analyst estimates typically exclude
one-time items.
Delta reports $1.4B 4Q loss; Shares plunge
ATLANTA (AP) -- Demand for air travel continues to weaken as deep
fare sales in recent weeks have not spurred customers to open up their wallets
in droves, Delta Air Lines Inc. executives said Tuesday after the world's
biggest carrier posted a $1.4 billion loss for the final three months of 2008
and signaled the revenue environment for 2009 will be challenging.
Delta shares plunged 20 percent in active trading Tuesday.
The Atlanta-based carrier said advance bookings for February and
March so far are not promising, especially for international flights.
By The Associated Press
The Dow Jones industrial average rose 58.70, or 0.72 percent, to
8,174.73.
Broader stock indicators also advanced. The Standard & Poor's
500 index rose 9.14, or 1.09 percent, to 845.71, and the Nasdaq composite index rose 15.44, or 1.04 percent,
to 1,504.90.
Light, sweet crude for March delivery lost $4.15 a barrel, or 9
percent, to settle at $41.58 in trading on the
In other Nymex trading, gasoline
futures fell 4.46 cents to settle at $1.1085 a gallon, while natural gas rose
1.3 cents to settle at $4.49 per 1,000 cubic feet. Heating oil gave up 5.25
cents to settle at $1.3745 a gallon.
In