Home sales fall after 4 months of increases
WASHINGTON (AP) -- Home
resales dipped unexpectedly last month, falling 2.7 percent from a month
earlier, the National Association of Realtors said Thursday, reversing steady
monthly gains since April. Most economists, however, called the drop temporary
and said they expected sales to strengthen later this fall.
But even if sales do turn
upward again, prices won't likely follow. Though prices have stabilized this
summer, many economists are forecasting a downward turn over the fall and
winter and expect prices to finally hit bottom early next year.
Compared with a year ago,
home sales are up 3.4 percent, and the inventory of unsold homes has been
whittled down to an 8.5 month supply at the current sales pace. That's the
lowest level in more than two years.
G-20 leaders focus on global
recovery, banker pay
PITTSBURGH (AP) -- Turning
from outright fear to cautious optimism, world leaders descended on the
comeback city of Pittsburgh Thursday to debate how to nurture a recovering but
still-wobbly global economy. The leaders appeared to be nearing agreement on
one of the more contentious issues, restricting bankers' compensation.
Nerves are still on edge,
but this summit of the world's 20 leading economies seems free of the crisis
atmosphere that hung over the past two.
It was less calm on the
streets, where police threw canisters of pepper spray and smoke at
demonstrators after marchers responded to calls to disperse by rolling trash
bins and throwing rocks.
A world first: Vaccine helps
prevent HIV infection
BANGKOK (AP) -- For the
first time, an experimental vaccine has prevented infection with the AIDS
virus, a watershed event in the deadly epidemic and a surprising result. Recent
failures led many scientists to think such a vaccine might never be possible.
The World Health
Organization and the U.N. agency UNAIDS said the results "instilled new
hope" in the field of HIV vaccine research, although researchers say it
likely is many years before a vaccine might be available.
The vaccine -- a combination
of two previously unsuccessful vaccines -- cut the risk of becoming infected
with HIV by more than 31 percent in the world's largest AIDS vaccine trial of
more than 16,000 volunteers in Thailand, researchers announced Thursday in
Bangkok.
Drop in home sales, tumbling
oil weigh on stocks
NEW YORK (AP) -- A surprise
drop in home sales and another slide in oil prices pushed investors to sell
stocks Thursday.
Stocks slid for a second day
after the National Association of Realtors said existing home sales fell 2.7
percent in August compared with a 7.2 percent rise in July. Economists had been
expecting a fifth straight increase.
The report overshadowed news
from the Labor Department that the number of newly laid off workers seeking
unemployment benefits fell for a third week in a row. Initial claims for
unemployment insurance fell by 21,000 last week to 530,000, slightly better
than economists expected.
Meanwhile, a stronger dollar
pressed commodity prices lower. That in turn hurt stocks of energy and
materials companies.
Oil falls sharply with
supplies on the rise
Oil prices fell sharply
Thursday for a second straight day as growing supplies of crude, gasoline and
heating oil exposed how badly the recession has cut into energy demand.
Benchmark crude for November
delivery fell 4.4 percent, or $3.08, to settle at $65.89 a barrel on the New
York Mercantile Exchange. The contract tumbled $2.79 to settle at $68.97 on
Wednesday.
Prices for gasoline and
heating oil also fell sharply.
Oil prices have been pushed
higher for months by the weak dollar and by strengthening equities markets.
New jobless claims drop
unexpectedly to 530K
WASHINGTON (AP) -- The
number of newly laid-off workers seeking unemployment benefits fell for the
third straight week, evidence that layoffs are continuing to ease in the
earliest stages of an economic recovery.
The Labor Department said
Thursday that initial claims for unemployment insurance dropped to a seasonally
adjusted 530,000 from an upwardly revised 551,000 the previous week. Wall
Street economists expected claims to rise by 5,000, according to a survey by
Thomson Reuters.
Rite Aid posts smaller 2Q
loss, cuts forecast
NEW YORK (AP) -- Rite Aid
Corp. on Thursday reported a smaller second-quarter loss than a year ago as it
cut expenses, but the nation's third-largest drugstore operator lowered its
expectations for the fiscal year due to the weak economy and high unemployment.
Rite Aid said economic
conditions have hurt its sales of nonpharmacy items like food and cosmetics
because customers looked harder for bargains and bought more items that were on
sale. It said rivals spent more money on promotions -- a move Rite Aid is
countering with a new rewards program -- and profit margins at pharmacies fell
due to lower reimbursement rates.
The company said those
trends are likely to continue through the holiday season.
Volcker: Obama plans
maintain 'too big to fail'
WASHINGTON (AP) -- A top
White House economic adviser says the Obama administration's proposed overhaul
of financial rules preserves the policy of "too big to fail," and
could lead to future bailouts.
Former Federal Reserve
Chairman Paul Volcker said Thursday that by designating some companies as
critical to the broader financial system, the plans create an expectation that
those firms enjoy government backing in tough times. That implies those
financial companies "will be sheltered by access to a federal safety
net," he said.
Lawmakers should make clear
that nonbank companies will not be saved with federal money, he said.
RIM posts lower fiscal 2Q
profit, higher sales
TORONTO (AP) -- BlackBerry
maker Research In Motion Ltd. reported a drop in fiscal second-quarter profits
Thursday because of charges for a patent settlement and said revenue for the
current quarter will fall below Wall Street's expectations.
Shares plunged in extended
trading.
Waterloo, Ontario-based RIM
earned $475.6 million, or 83 cents per share, for the June-August period, down
4 percent from $495.5 million, or 86 cents per share, in the same period a year
earlier.
General Motors CEO sees
modest sales growth in '10
ORLANDO, Fla. (AP) -- U.S.
auto sales should improve modestly next year as tight credit for auto financing
eases and the economy works its way out of the recession, General Motors Co.'s
top executive said Thursday.
CEO Fritz Henderson said he
expects the auto industry to sell 11.5 million to 12 million cars and light
trucks in the U.S. next year, compared with about 10 million to 10.5 million
vehicles this year.
Henderson spoke to reporters
in Orlando on the last stop of a nine-city tour.
US Bank also to ease
overdraft penalties
MINNEAPOLIS (AP) -- U.S.
Bank is the latest financial institution to back off on the penalties customers
face for overdrafting their accounts.
The bank's Minneapolis-based
parent, U.S. Bancorp, said Thursday that it's changing checking account
overdraft policies effective in the first quarter of next year. The move
follows similar announcements by Bank of America Corp., JPMorgan Chase &
Co. and Wells Fargo & Co. earlier this week.
U.S. Bank will eliminate
overdraft fees when a customer's account is overdrawn by less than $10. That's
regardless of the number of overdraft transactions that may have occurred. And
the bank will limit the number of overdraft fees charged to no more than three
per day.
By The Associated Press
The Dow Jones industrials
fell 41.11, or 0.4 percent, to 9,707.44. The Standard & Poor's 500 index
fell 10.09, or 1.0 percent, to 1,050.78, and the Nasdaq composite index fell
23.81, or 1.1 percent, to 2,107.61.
Benchmark crude for November
delivery fell 4.4 percent, or $3.08, to settle at $65.89 a barrel on the New
York Mercantile Exchange. The contract tumbled $2.79 to settle at $68.97 on
Wednesday.
In other Nymex trading,
gasoline fell 6.83 cents to settle at $1.6366 per gallon and heating oil for
October delivery fell 7.8 cents to settle at $1.6814 a gallon. Natural gas rose
9.5 cents to settle at $3.955 per 1,000 cubic feet.
In London, Brent crude fell
$3.17 to settle at $64.82 on the ICE Futures exchange.