AP Business Highlights

  • Thursday March 12, 2009, 6:15 pm EDT

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A 'sorry and ashamed' Bernard Madoff pleads guilty

NEW YORK (AP) -- Saying he was "deeply sorry and ashamed," Bernard Madoff pleaded guilty Thursday to pulling off perhaps the biggest swindle in Wall Street history and was immediately led off to jail in handcuffs to the delight of his seething victims.

Madoff, 70, could get up to 150 years in prison when he is sentenced in June.

In refusing to let the disgraced financier remain free on bail until then, U.S. District Judge Denny Chin noted that Madoff had the means to flee and an incentive to do so.

Dow ends up 240 on good news for banks, GM, retail

NEW YORK (AP) -- Investors have been clamoring for months for a bit of good news. On Thursday, they got a load of it. The Dow Jones industrials shot up 240 points 7,170.06, bringing its gains over the past three days to 622 points. It was the index's biggest three-day jump since last November.

This week's rally got an extra dose of adrenaline after an accounting board told Congress Thursday it may recommend a let-up in financial reporting rules for troubled banks in three weeks. Upheaval in the banking industry has been dogging the market since 2007, and hope that banks might finally get relief in how they value their bad assets spurred a flurry of buying.

Fed reports record fall in household net worth

WASHINGTON (AP) -- The net worth of American households fell by the largest amount in more than a half-century of record keeping during the fourth quarter of last year.

The Federal Reserve said Thursday that household net worth dropped by a record 9 percent from the level in the third quarter.

The decline was the sixth straight quarterly drop in net worth and underscored the battering that U.S. families are undergoing in the midst of a steep recession with unemployment surging and the value of their homes and investments plunging.

Net worth represents total assets such as homes and checking accounts minus liabilities like mortgages and credit card debt.

Jobless claims rise as retail sales slip

WASHINGTON (AP) -- With layoffs spreading, the number of initial claims for jobless benefits rose last week, while the total number of people continuing to receive benefits set a record high, the government said Thursday.

The Labor Department reported that first-time requests for unemployment insurance rose to 654,000 from the previous week's upwardly revised figure of 645,000, above analysts' expectations.

The number of people receiving benefits for more than a week increased by 193,000 to 5.3 million, the most on records dating back to 1967. That's the sixth time in the past seven weeks that the jobless claims rolls have set a record high.years.

GM says it doesn't need $2B from gov't in March

DETROIT (AP) -- It's not as good as black ink, but General Motors' news that it doesn't need government loan money this month is a sign that it is finally starting to bring its gargantuan expenses under control.

GM Chief Financial Officer Ray Young said Thursday that the struggling automaker's fortunes have improved to the point that it won't need the $2 billion March installment, despite the request the company made less than a month ago.

But Young wouldn't say when the GM might need more help, nor would he say whether it planned to reduce its request for a total of $30 billion in government financing.

General Electric loses top credit rating

WASHINGTON (AP) -- General Electric Co. lost its top credit rating from Standard & Poor's on Thursday over concerns of rising loan losses and lower earnings at its lending arm, GE Capital.

The long-expected ratings cut -- down one notch to 'AA+' from 'AAA' -- offered further proof that the financial crisis has shaken the foundation of one of the nation's biggest and traditionally most stable companies. In the past year, GE has posted disappointing earnings, seen loan losses grow, and cut its dividend for the first time since the Great Depression. The loss of its pristine credit rating means the company, which makes loans, light bulbs, and runs NBC, will likely pay more to borrow money.

Roche to take over Genentech for $47 billion

NEW YORK (AP) -- Swiss pharmaceutical giant Roche agreed Thursday to pay $46.8 billlion in cash to buy the 44 percent of California-based biotech pioneer Genentech that it doesn't already own, ending a long corporate struggle between the companies.

The deal, which values the whole of Genentech at more than $100 billion, underscores the lengths drugmakers are willing to go to shore up weak pipelines of new drugs. And investors and the industry will be watching to see if Roche can preserve the unique research culture that helped Genentech all but start the biotech industry.

House panel gets FASB pledge on accounting rule

WASHINGTON (AP) -- A House panel wrung a pledge Thursday from the head of an accounting board to try to issue guidelines in three weeks that will ease rules that force banks to value assets at current prices.

The commitment by the chairman of the independent Financial Accounting Standards Board came amid a muscular display of congressional power at a hearing on the so-called mark-to-market accounting rules. The head of the House panel, Rep. Paul Kanjorski, D-Pa., had held out the threat of legislation to pressure the standard-setting board and the Securities and Exchange Commission to take steps that would give relief to battered banks.

Chrysler threatens to pull out of Canada

OTTAWA (AP) -- A top Chrysler official issued a grim threat to Canadian lawmakers, warning the struggling U.S. automaker may shut down its plants in Canada if it doesn't get significant labor concessions and government aid.

Chrysler's labor costs in Canada work out to about $20 an hour more than automakers like Toyota Motor Corp. and Honda Motor Co., president Tom LaSorda told a Parliamentary committee Wednesday night.

The automaker also asked for roughly $2.3 billion from the Canadian and Ontario governments and demanded relief in a tax dispute with Ottawa.

Smithfield Foods posts 3Q loss of $103.1 million

MILWAUKEE (AP) -- Smithfield Foods Inc. reported a third-quarter loss Thursday that was less than analysts predicted and said its performance would improve as it focuses on the packaged meats business, where it can make more money.

Shares soared nearly 20 percent for the Smithfield, Va.-based company, the nation's largest hog producer and pork processor, as executives offered brighter predictions for the business, which has been struggling along with others in the meat industry.

By The Associated Press

The Dow rose 239.66, or 3.5 percent, to 7,170.06. The Standard & Poor's 500 index climbed 29.38, or 4.1 percent, to 750.74. The Nasdaq composite index gained 54.46, or 4 percent, to 1,426.10.

The Russell 2000 index of smaller companies rose 23.82, or 6.5 percent, to 390.12.

Benchmark crude for April delivery jumped $4.70 to settle at $47.03 a barrel on the New York Mercantile Exchange. In London, Brent prices gained $3.69 to settle at $44.88 on the ICE Futures exchange.

In other Nymex trading, gasoline for April delivery jumped 9.45 cents to settle at $1.33457 a gallon, while heating oil gained 9.3 cents to settle at $1.2264 a gallon. Natural gas for April delivery rose 19.7 cents to settle at $3.995 per 1,000 cubic feet.