Housing and jobless data signal a fragile recovery
WASHINGTON (AP) -- Adding to
evidence the recession has ended, housing construction rose in August and fewer
laid-off workers sought jobless aid last week.
Still, the reports suggested
a slow and fragile economic recovery. The rise in housing starts was due solely
to a jump in the volatile apartment-building category, and unemployment claims
remain far above levels associated with a healthy economy.
Construction of
single-family homes and apartments rose 1.5 percent to an annual rate of
598,000 units, the highest level since November, the Commerce Department said
Thursday.
Initial claims for
unemployment benefits dropped last week to a seasonally adjusted 545,000 from
557,000 the previous week, the Labor Department said.
Stocks slip as investors
take break from rally
NEW YORK (AP) -- A surprise
drop in unemployment claims couldn't fuel another day of gains for the stock
market.
Stocks posted modest losses
in quiet trading Thursday after a three-day advance. Traders found little in
the weekly employment data, or in reports on housing and manufacturing, to
provide new encouragement about an economic recovery. Stocks surrendered early
gains around midday and the Dow Jones industrial average ended with a loss of 8
points.
Lackluster earnings reports
from FedEx Corp. and Oracle Corp. added to investors' caution.
The Dow Jones industrial
average fell 7.79, or 0.1 percent, to 9,783.92.
US net worth grows for first
time since '07
WASHINGTON (AP) -- For the
first time in two years, Americans actually got a little wealthier.
Household wealth grew by $2
trillion, or about 4 percent, this spring, ending the longest stretch of
quarterly declines on records dating back to 1952, the Federal Reserve reported
Thursday.
Net worth -- the value of
assets such as homes, checking accounts and investments minus debts like
mortgages and credit cards -- came to $53.1 trillion for the second quarter.
Stock portfolios came back
to life this spring after the market hit its lows for the year in March, and
home prices have stabilized. But the collective American wallet is still almost
20 percent thinner than it was when net worth peaked two years ago.
As stocks keep rallying,
IPOs return
NEW YORK (AP) -- Coming off
its worst year in three decades, the market for initial public offerings is
starting to show signs of life.
Eight companies are looking
to raise as much as $3.7 billion when they go public next week, the most
activity the U.S. IPO market has seen in a single week in nearly two years and
a clear sign that Wall Street's appetite for risk is returning.
IPOs all but dried up in
2008 as investors shunned the traditionally risky bets and moved into safer
assets like cash and Treasurys as the stock market tumbled.
Only 43 companies completed
IPOs in the U.S. last year, down from 272 the year before and 221 in 2006,
according to Renaissance Capital's IPOHome.com. It was the slowest year for
IPOs since 1978.
FedEx 1Q profit falls, sees
improving economy
NEW YORK (AP) -- FedEx Corp.
said Thursday it sees signs of improvement in the global economy as
international shipments pick up, but warned its profit will remain weak at
least through the end of the year.
The world's second-largest
package delivery company, considered a bellwether of economic health, said
fiscal 2010 first-quarter earnings fell 53 percent -- matching its prediction
released last week. It also reiterated a fiscal second-quarter view that
implies a modest uptick in worldwide economic activity.
FedEx indicated it might
start beefing up schedules for flight crew and hourly personnel as package
volume improves, but it doesn't expect that to happen soon. It also doesn't
expect to start adding back employees it cut during the worst of the downturn
in the near future.
Oil edges lower with hints
of a slow rebound
NEW YORK (AP) -- Oil prices
edged lower on new government data that indicated a slow economic recovery.
That would mean less demand
for energy in the near term and potentially low-priced gasoline and heating gas
for some time.
Benchmark crude for October
delivery slipped 3 cents to settle at $72.47 a barrel on the New York
Mercantile Exchange. Prices crested at $73.16 a barrel in morning trading, the
highest that crude has reached this month.
At the pump, retail gas
prices dropped nearly a penny overnight to a new national average of $2.55 a
gallon, according to auto club AAA, Wright Express and Oil Price Information
Service. Gas prices are now falling away from the peaks reached in June at the
outset of the driving season, when a gallon hit $2.69.
Gov't considers crackdown on
loan help payments
WASHINGTON (AP) -- The head
of the Federal Trade Commission said Thursday the agency is considering banning
upfront payments to companies that advertise help for borrowers who are in
trouble on their home loans.
Government officials say
scammers seeking to take advantage of borrowers in danger of default often
charge upfront fees of $1,000 to $3,000 for help with loan modifications that
rarely, if ever, pay off.
"If you are concerned
about keeping your home, avoid any company that asks you for a large fee in
advance. That is a real red flag," said Jon Leibowitz, chairman of the
FTC. Such upfront fees are already prohibited in 20 states.
Madoff's NY beach home sells
for more than $8.75M
NEW YORK (AP) -- It boasts
ocean views, an infamous former owner -- and now a buyer willing to pay more
than $8.75 million.
An unidentified would-be
buyer or buyers snapped up Bernard Madoff's Long Island beach house within days
after the U.S. Marshals Service put the seized property up for sale, a spokeswoman
for the broker the Corcoran Group said Thursday.
Spokeswoman Anne Lacombe
said the fallen money manager's Montauk retreat was under contract for more
than its $8.75 million asking price. She didn't have the exact figure, any
information on the intended buyer or the closing date.
American Airlines parent
gets $2.9B, shifts routes
ATLANTA (AP) -- American
Airlines' parent company said Thursday it is taking on significant new debt at
a time when revenues are being hammered, but the $2.9 billion in cash and fresh
financing it raised should quiet concerns -- for now -- that it is in danger of
a cash crunch and a bankruptcy filing.
Passengers will see big
changes from the nation's second-largest airline, including increased flying in
Chicago, New York, Los Angeles, Dallas-Fort Worth and Miami, but fewer flights
in Raleigh/Durham, N.C. and St. Louis, where American is giving up major ground
to Southwest Airlines.
Palm posts larger 1Q loss,
but beats Street view
SUNNYVALE, California (AP)
-- Smart phone maker Palm Inc. posted a wider loss for its fiscal first quarter
on Thursday as revenue dropped, but adjusted earnings and sales handily beat
Wall Street's expectations.
For the three months ended
Aug. 28, the company posted a loss after paying preferred dividends of $164.5
million, or $1.17 per share, compared with a loss of $41.9 million, or 39 cents
per share, in the same period a year earlier.
Excluding one-time items,
however, the company posted a much smaller loss of $13.6 million, or 10 cents
per share, in the latest quarter.
By The Associated Press
The Dow Jones industrial
average fell 7.79, or 0.1 percent, to 9,783.92.
The S&P 500 index fell
3.27, or 0.3 percent, to 1,065.49, and the Nasdaq composite index fell 6.40, or
0.3 percent, to 2,126.75.
Benchmark crude for October
delivery slipped 3 cents to settle at $72.47 a barrel on the New York
Mercantile Exchange.
Natural gas lost 25.2 cents
to settle at $3.458 per 1,000 cubic feet.
In other Nymex trading,
gasoline for October delivery rose less than a penny to settle at $1.8512 a
gallon, and heating oil rose by less 1.5 cents to settle at $1.8409 a gallon.
In London, Brent crude gave
up 12 cents to settle at $71.55 a barrel on the ICE Futures exchange.