AP Business Highlights

On Thursday April 15, 2010, 5:46 pm EDT

Rise in jobless claims underscores wobbly recovery

WASHINGTON (AP) -- A spike in unemployment claims Thursday underscored the bumpiness of the economic rebound: Consumers are spending more. Factories are making more. But layoffs have not tapered off as fast as expected.

So can the recovery gather much steam if 17 percent of working-age Americans remain jobless or underemployed?

Employers have begun to add jobs recently, including 162,000 in March. Yet much stronger job creation is needed to ease the current 9.7 percent unemployment rate. And if layoffs were to spike and job creation sputter, the recovery could fall back into a "double-dip" recession.

Toyota conducts safety tests on all SUV models

TOKYO (AP) -- Toyota is testing all its sport utility vehicles to reassure buyers of their safety after Consumer Reports warned a large Lexus SUV is susceptible to rolling over.

The testing covers the entire lineup of Toyota and Lexus SUVs, including popular models such as the RAV4, the 4Runner and the Highlander, said Toyota spokesman Brian Lyons. The automaker will be testing the vehicles' stability control and aims to replicate the Consumer Reports' test that first uncovered the problem, he said. He was unaware how long the tests would take.

Google 1Q profit rises 37 pct but stock slides

SAN FRANCISCO (AP) -- Google Inc.'s first-quarter profit rose 37 percent as more people clicked on higher-priced Internet ads powered by the company's search engine, but investors possibly worried about Google's rising expenditures sent its stock down sharply.

Google shares fell $31.30, 5.3 percent, to $564 in after-hours trading. Before the earnings release they closed at $595.30, up 1.1 percent on the day.

Even so, the results released Thursday are the latest indication that the online advertising and technology sectors are bouncing back from the recession more quickly than many other parts of the economy.

China's robust growth fuels debate over policy

SHANGHAI (AP) -- The latest surge in China's growth is welcome news for the global recovery and could give Beijing room to let its currency yuan rise, while adding to pressure to take that step to help cool inflation.

Growth in the world's third-largest economy accelerated to 11.9 percent in the first quarter, the government reported Thursday. Inflation stayed low, allowing Beijing to avoid drastic steps to slow its boom, which is driving demand for foreign raw materials and consumer goods.

Such dynamic growth could help offset potential losses to China's exporters from any gains in the value of the country's yuan, enabling Beijing to go ahead with a widely expected but modest loosening of currency controls.

Senate panel says regulators ignored risks at WaMu

WASHINGTON (AP) -- A Senate panel contends regulators failed to stop "shoddy" lending and excessive risk-taking at Washington Mutual because they were too chummy with WaMu executives.

Panel chairman Sen. Carl Levin, D-Mich., says the Office of Thrift Supervision's chief called WaMu CEO Kerry Killinger a "constituent." The OTS was funded by fees from WaMu and other regulated banks.

Levin, who heads the Permanent Subcommittee on Investigations, says the OTS oversaw WaMu "on a collaborative basis, not a regulatory basis."

China trims holdings of US Treasurys by 1.3 percent

WASHINGTON (AP) -- China trimmed its holdings of U.S. Treasury debt 1.3 percent in February, the fourth consecutive decline. Those reductions are raising concerns that the U.S. government could face higher interest rates to finance its soaring budget deficits.

The Treasury Department said Thursday that China's holdings dropped $11.5 billion to $877.5 billion. That still left China as the largest foreign holder of U.S. Treasury debt. Japan retained the No. 2 spot with $768.5 billion, a drop of 0.4 percent from the January level.

Banks once again cut emergency borrowing from Fed

WASHINGTON (AP) -- Banks borrowed less from the Federal Reserve's emergency lending program over the past week, providing more evidence that credit problems are easing.

The Fed said that banks averaged $6.77 billion in daily borrowing for the week that ended Wednesday. That was down from $7.21 billion in average borrowing in the previous weeks.

Banks have been reducing their use of the Fed's emergency discount window as financial conditions have improved.

Volcanic ash cloud disrupting US flights to Europe

WASHINGTON (AP) -- The bottom fell out of travel plans for thousands of U.S. airline passengers Thursday as dozens of flights between the U.S. and Europe were canceled, part of a global disruption in air travel as clouds of ash from a volcano in Iceland forced widespread closures of European airports.

At least 100 U.S. flights had been canceled by early Thursday afternoon Eastern Daylight Time, according to David Castelveter, a spokesman for the Air Transportation Association, which represents most major U.S. carriers.

Firm of ex-Obama aide settles NY corruption probe

NEW YORK (AP) -- An investment firm founded by President Obama's former car czar, Steven Rattner, has agreed to pay $12 million to resolve allegations that it paid kickbacks to drum up business from New York's giant government pension fund.

The Quadrangle Group said it would refund $7 million to the pension fund and pay another $5 million to the Securities and Exchange Commission as part of the deal, which was announced Thursday.

The settlement covers only Quadrangle, not Rattner, who left the firm last year to become co-leader of the presidential task force that restructured the auto industry.

US government: 7 UBS customers hid Swiss-based assets

NEW YORK (AP) -- Seven customers of banking giant UBS have been charged with conspiracy and criminal tax offenses in a scheme to conceal more than $100 million in Swiss-based assets and any profits from the Internal Revenue Service, prosecutors announced Thursday.

The charges were contained in five indictments in U.S. District Court in Manhattan. Two of the defendants pleaded guilty Thursday to filing false federal income tax returns and agreed to pay millions of dollars in penalties.

By The Associated Press

The Dow rose 21.46, or 0.2 percent, to 11,144.57, its highest close since Sept. 19, 2008.

The S&P 500 rose 1.02, or 0.1 percent, to 1,211.67, while the Nasdaq rose 10.83, or 0.4 percent, to 2,515.69.

Benchmark crude for May delivery fell 33 cents to settle at $85.51 a barrel on the New York Mercantile Exchange.

In other Nymex trading in May contracts, heating oil rose a penny to settle at $2.2523 a gallon, and gasoline slid 0.65 cent to settle at $2.3262 a gallon. Natural gas dropped 21.4 cents to settle at $3.985 per 1,000 cubic feet.

In London, Brent crude rose $1.02 to settle at $87.17 on the ICE futures exchange.

 

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