J&J ekes out profit rise despite sales drop
TRENTON, N.J. (AP) --
Band-Aid maker Johnson & Johnson is feeling the pain as consumers worldwide
buy more generic health products -- whether it's prescription medicines or
store-brand bandages -- or just do without for as long as they can.
The company, the world's
most diversified health-products maker, saw its revenue fall 5 percent in the
third quarter as intensifying generic competition slashed sales of about a
half-dozen of its prescription drugs, and recession-wary consumers limited
spending on items from contact lenses to artificial hips.
The maker of Band-Aids,
biotech drugs and Acuvue contact lenses on Tuesday reported a meager 1 percent
increase in third-quarter net income, at $3.35 billion, or $1.20 per share.
Mixed J&J earnings leave
investors little to cheer
NEW YORK (AP) -- Investors
grew cautious Tuesday after quarterly sales at Johnson & Johnson fell short
of expectations and an influential analyst stirred worries that bank shares are
overheated.
Most stocks posted modest
losses Tuesday, a day after major indexes finished at their best levels in a
year. The Dow Jones industrial average slipped 15 points to 9,871.06, though
the Nasdaq composite index edged higher.
Stocks could get a bounce
Wednesday from Intel Corp., which posted earnings and sales after the closing
bell that topped expectations. The leading chipmaker also said business is
improving.
Bank of America giving up
Merrill deal documents
CHARLOTTE, N.C. (AP) -- Bank
of America Corp., giving up a months-long fight with regulators, plans to turn
over documents revealing legal advice it received on its purchase of Merrill
Lynch.
In a turnabout, the bank
will waive attorney-client privilege that kept it from telling regulators about
recommendations it received from outside attorneys over whether to disclose
details to shareholders about Merrill's mounting troubles.
Charlotte, N.C.-based Bank
of America has agreed to waive its attorney-client privilege for investigations
by the New York attorney general's office, the Securities and Exchange
Commission and a congressional committee, a person familiar with the bank's
agreement said. The person spoke on condition of anonymity because the information
wasn't publicly disclosed.
CIT Group says CEO Peek
plans to resign
NEW YORK (AP) -- CIT Group
Inc., struggling as it continues efforts to restructure its debt, said Tuesday
chairman and CEO Jeffrey M. Peek will resign at the end of the year.
It is widely believed that
the commercial lender, which has received $2.3 billion in federal bailout
money, may be forced to seek bankruptcy court protection, and analysts said
Peek's departure could be a sign that the company does plan a Chapter 11 filing
that would enable it to reorganize its operations and finances.
Sameer Gokhale, a senior
analyst at Keefe, Bruyette & Woods Inc. said that if CIT plans to
reorganize, it would make sense to bring in a new CEO to run a new capitalized
firm, he said.
Pay czar asks AIG not to pay
promised bonuses
WASHINGTON (AP) -- The Obama
administration's pay czar has asked American International Group to withhold
some of the millions in bonuses promised to its employees.
Kenneth Feinberg, the
special master for executive compensation, "has informally advised AIG not
to pay the full $198 million" employees expect to receive, according to a
report Tuesday from the special inspector general overseeing the $700 billion
financial bailout.
Feinberg is locked in
negotiations with the seven companies that received the most expensive taxpayer
bailouts. AIG's was by far the largest. The government committed more than $180
billion to wind down the New York-based insurance and financial services
conglomerate. Treasury now owns about 80 percent of AIG.
Intel profit falls but
outlook upbeat, stock jumps
SAN FRANCISCO (AP) -- Intel
Corp.'s third-quarter numbers show the company is getting better at doing more
with less in the toughest stretch for the personal computer industry in nearly
a decade.
The world's No. 1
microprocessor maker said Tuesday that profit and sales both fell 8 percent in
the July-September period, as the company was hurt by sluggish demand from
businesses and lower prices for its chips. Intel has insisted things are
improving, however, and offered better-than-expected guidance for the fourth
quarter, sending its shares up nearly 5 percent.
As the first major
technology company to report third-quarter earnings, Intel's numbers will lend
insight into the strength or weakness of PC makers' demand for new chips. What
the figures don't show, though, is whether PC companies are stocking up on
chips to replenish low supplies, or whether they expect especially brisk sales
of computers to consumers and businesses.
CSX earnings fall, says
worst of recession is over
NEW YORK (AP) -- CSX Corp.,
the nation's third largest railroad, said Tuesday it believes the worst of the
recession is over, but its third-quarter earnings fell 23 percent from a year
ago because shipping demand is still weak.
CSX, which operates its
signature blue and yellow locomotives from Canada to Florida and west to the
Mississippi River, said overall shipping fell 15 percent from a year ago in the
June-to-September period. The biggest drops were in shipments of coal, cars,
construction and consumer goods. The company warned that demand for coal, one
of its biggest segments, will remain weak well into next year.
But CSX said that the
third-quarter decline in total volume wasn't as steep as in the second quarter
-- possibly indicating the start of an economic recovery in the U.S. Rail
traffic is seen as an indicator of the economy's direction because so many
everyday goods are shipped on the tracks.
Bloomberg plans to take over
BusinessWeek magazine
NEW YORK (AP) -- Bloomberg
LP is buying BusinessWeek magazine in a deal that brings together a financial
news service specializing in rapid-fire updates with a print publication
struggling to adapt to the Internet's information whirlwind.
Terms were not disclosed.
The sale announced Tuesday
is expected to close by the end of the year. It would end BusinessWeek's
80-year run as part of McGraw-Hill Cos., which also owns the Standard &
Poor's credit rating agency.
McGraw-Hill put BusinessWeek
on the auction block in July, apparently fed up with the losses that have been
mounting at the magazine as its advertising revenue plunged.
Ford adds 4.5M vehicles to
defective switch recall
DETROIT (AP) -- Ford Motor
Co. said Tuesday it will add 4.5 million older-model vehicles to the long list
of those recalled because a defective cruise control switch could cause a fire.
The latest voluntary action
pushes Ford's total recall due to faulty switches to 14.3 million registered
vehicles over 10 years, capping the company's largest cumulative recall in
history involving a single problem.
The recall covers 1.1
million Ford Windstar minivans that had a small risk of fire due to internal
leaking from the switches. Ford said in a letter to federal regulators that it
found a small number of reported fires linked to the problem during an internal
investigation that began last year, but did not specify how many.
China auto sales jump 78
percent in September
SHANGHAI (AP) -- China has
widened its lead over the U.S. as the world's top auto market, with September
sales vaulting 78 percent, spurred by tax cuts and government stimulus
spending.
Sales totaled 1.33 million
vehicles last month, with passenger cars climbing 84 percent, the China
Association of Automobile Manufacturers reported. It was the seventh month that
China's auto sales surpassed 1.1 million vehicles.
Sales in smaller cities have
been booming as automakers rush to woo first-time car buyers. Those trends have
global automakers looking to the world's most populous nation to drive revenues
as demand in other big markets remains sluggish.
By The Associated Press
The Dow fell 14.74, or 0.2
percent, to 9,871.06.
The Standard & Poor's
500 index fell 3.00, or 0.3 percent, to 1,073.19, its first loss after six days
of gains. The Nasdaq rose 0.75, or less than 0.1 percent, to 2,139.89.
Benchmark crude for November
delivery gained 88 cents to settle at $74.15 on the New York Mercantile
Exchange.
Natural gas prices tumbled
29.2 cents, nearly 6 percent, to settle at $4.588 per 1,000 cubic feet on
Nymex.
In other Nymex trading,
heating oil rose almost 3 cents to settle at $1.9234 a gallon, and gasoline for
November delivery gained about 3.3 cents to settle at $1.8318 a gallon.
In London, Brent crude rose
$1.04 to settle at $72.40 on the ICE Futures exchange.