NEW YORK (AP) -- The big
banks are showing they can still make money, even as Main Street struggles --
though not from lending, refinancing homes or other bread-and-butter business. Instead, they're doing what
Wall Street does best -- betting big on stocks, bonds, commodities and other
assets. Citigroup, the shakiest of
the major banks during the financial crisis, reported Thursday it eked out a
quarterly profit from trading, despite suffering more losses on consumer loans.
Trading also drove big profits at Goldman Sachs and JPMorgan Chase. Stocks rise as energy gains
offset drop in banks NEW YORK (AP) -- A late-day
surge left stocks with modest advances Thursday as a jump in the price of oil
lifted energy companies and offset weakness in bank shares. The gains came a day after
strong profit reports from JPMorgan Chase & Co. and Intel Corp. vaulted the
Dow Jones industrials above the 10,000 level for the first time in a year. The
Dow tacked on another 47 points to 10,062.94. Stocks spent most of the day
lower but rallied in the final 15 minutes of trading ahead of quarterly reports
from Google Inc., IBM Corp. and chip maker Advanced Micro Devices that arrived
after the closing bell. All three topped expectations and could help the market
extend its gains if reports due early Friday from General Electric Co. and Bank
of America Corp. aren't spoilers. Jobless claims, muted
inflation boost recovery WASHINGTON (AP) -- New
jobless claims dropped to the lowest level since January and the prices of many
household goods stayed low last month, positive signs of stability for the
fledgling economic recovery. The decline in jobless
claims shows companies are cutting fewer workers, though the drop isn't yet
steep enough to signal new hiring, economists said. And the low level of
inflation is holding down prices as Americans slowly regain their appetite to
shop despite rising unemployment and tight credit conditions. Low inflation is consistent
with the early stages of an economic recovery, Baumohl said. Even as business
activity picks up, unemployment is still high and factories have enough spare
capacity to increase output without sending prices higher. Banks cut back on Fed
emergency lending programs WASHINGTON (AP) -- Banks cut
back on loans from the Federal Reserve's emergency borrowing facility over the
past week and trimmed use of other credit programs set up to ease the financial
crisis, a sign credit problems are moderating. The Fed on Thursday said
commercial banks averaged $27.4 billion in daily borrowing over the week that
ended Wednesday. That was down from $27.9 billion in the week ended Oct. 7. The identities of the
financial institutions are not released. They pay just 0.50 percent in interest
for the emergency, overnight loans. Banks scaled back their use
of another program aimed at boosting the availability of short-term financing
crucial for paying salaries and supplies. No Social Security hike,
could boost new payments WASHINGTON (AP) -- Social
Security recipients won't get a cost-of-living increase next year for the first
time in more than a third of a century, and that could boost President Barack
Obama's plan to send seniors another round of $250 payments before the congressional
elections. Democratic leaders in
Congress have signed onto the plan, greatly improving its chances, even as some
budget hawks say the payments are unwarranted and could add to the federal
budget deficit. Republican leaders said they, too, favor the payments but don't
want to increase the deficit to pay for them. More than 50 million Social
Security recipients will see no increase in their monthly payments next year,
the government said Thursday, the first year without an increase since automatic
adjustments were adopted in 1975. Google's growth accelerates
as 3Q profit rises SAN FRANCISCO (AP) -- Google
Inc. shifted into a higher gear in the third quarter and began to leave the
recession behind as the 11-year-old Internet search leader recorded its highest
profit ever. The results released
Thursday are the strongest indication yet that the Internet advertising market
is bouncing back from its worst funk since the dot-com bust at the start of the
decade. Google is considered a good
barometer for the state of Internet commerce because its search engine serves
as the hub of the Web's largest adverting network. "The worst of the
recession is clearly behind us and because of what we have seen, we now have
the confidence to be optimistic about our future," Eric Schmidt, Google's
chief executive, told analysts in a conference call. IBM boosts '09 guidance
again even as sales slump SAN FRANCISCO (AP) -- IBM
Corp. has jacked up its profit guidance for the second time this year, a sign
of the company's confidence that it can uncork more profit from its business
despite falling sales. The company's third-quarter
results, reported after the market closed Thursday, show that corporations are
still reluctant to spend on some kinds of technology. IBM's sales fell 7
percent, and all its major divisions suffered declines. But IBM keeps making more
money -- net income was up 14 percent -- largely because it has been focusing
on outsourcing and other services that save clients money and are more
profitable for IBM than selling hardware. That has been the key element of
IBM's transformation from a hardware company on the brink of collapse in the
1990s to a one-stop technology shop that rivals are trying to emulate. AMD sales better than
expected, CPU demand rises SEATTLE (AP) -- Advanced
Micro Devices Inc. lost money in the third quarter but said Thursday that sales
were stronger than expected, adding to mounting evidence that consumer spending
is fueling a turnaround in the personal computer market. AMD sells about 20 percent
of the world's computer microprocessors, which are the brains inside PCs.
Although AMD was hurt by weak consumer and business spending on computers in
the first half of the year, the chipmaker said shipments rose from the previous
quarter thanks to strong demand for processors used in laptop computers. That's in line with what PC
industry researchers reported earlier this week. Big draw in gas supply sends
energy prices jumping DENVER (AP) -- Evidence that
refiners severely curtailed their production of gasoline over the past week
sent energy prices jumping across the board. The Energy Information
Administration reported Thursday that gasoline in storage fell by more than 5
million barrels at a time when most energy experts expected supplies to grow yet
again. Oil prices hit a new high for the year, rising to almost $78 a barrel. Consumers may see a bump
upward in pump prices but only a slight one, experts believe, because gas
supplies greater than what they usually are at this time of the year and demand
is still low due to the recession. Administration declines to
cite China on currency WASHINGTON (AP) -- The Obama
administration on Thursday declined to name China as a country that is
manipulating its currency to gain unfair trade advantages. The Treasury Department did
say it has "serious concerns" about a lack of flexibility in the
value of China's currency against other currencies, and the country's rapid
accumulation of foreign exchange reserves including U.S. dollars. The latest finding is
certain to spark protests among American manufacturers who contend that China
is keeping its currency at artificially low levels against the dollar to gain
unfair trade advantages. The critics say the weak Chinese currency has resulted
in lost U.S. jobs. By The Associated Press The Dow rose 47.08, or 0.5
percent, to 10,062.94, its highest close since Oct. 3 last year. The broader Standard &
Poor's 500 index rose 4.54, or 0.4 percent, to 1,096.56. The Nasdaq composite
index rose 1.06, or 0.1 percent, to 2,173.29. Benchmark crude prices rose
another $2.40 to settle at $77.58 on the New York Mercantile Exchange. Heating oil futures rose
7.53 cents to settle at $2.0181 a gallon while natural gas for November
delivery rose 4.6 cents to settle at $4.482 per 1,000 cubic feet. Gasoline for
November delivery gained 8.74 cents to settle at $1.9449 a gallon. In London, Brent crude rose
$1.35 to settle at $74.45 on the ICE Futures exchange.