Steady US housing recovery is boosting economy
WASHINGTON (AP) – From purchases and prices to builder sentiment and construction, the U.S. housing market is making consistent gains.
The latest evidence came in reports Monday that sales of previously occupied homes rose solidly in October and that builders are more confident than at any other time in 6 1/2 years.
New-home sales and home-price indexes have reached multi-year highs. And Lowe's Cos. on Monday reported a surge in net income, a sign that home-improvement retailers are benefiting.
The housing market's recovery still has a long way to go. But for now, it's helping prop up an economy that's being squeezed by a global slowdown and looming spending cuts and tax increases.
Intel CEO Paul Otellini to retire in surprise move
SAN FRANCISCO (AP) – Intel CEO Paul Otellini is retiring in May, giving the world's largest maker of microprocessors six months to find a new leader as it confronts two major challenges: a shaky economy and a shift toward mobile devices that is reducing demand for its PC chips.
Although Otellini's impending departure was announced Monday, he notified Intel Corp.'s board of his retirement plan last Wednesday. The decision surprised Intel's board of directors, which expected Otellini to remain CEO until the company's customary retirement age of 65. Otellini is 62.
5 big US banks have cut mortgage balances by $6.3 billion
LOS ANGELES (AP) – Five of the biggest U.S. banks have cut struggling homeowners' mortgage balances by $6.3 billion, part of a total $26.1 billion in home loan relief provided under a landmark settlement over foreclosure abuses.
More than 309,000 borrowers received some form of mortgage relief between March 1 and Sept. 30, according to a report issued Monday by Joseph Smith, monitor of the settlement.
That translates to roughly $84,385 per homeowner, according to the report, which is based on mortgage servicers' own accounts of their progress as they move to comply with the settlement terms.
Average US credit card debt per borrower up in 3Q
LOS ANGELES (AP) – Americans cranked up their use of credit cards in the third quarter, racking up more debt than a year ago, while also being less diligent about making payments on time, an analysis of consumer-credit data shows.
The average credit card debt per borrower in the U.S. grew 4.9 percent in the July-to-September period from a year earlier, to $4,996, credit reporting agency TransUnion said Monday.
At the same time, the rate of credit card payments at least 90 days overdue hit 0.75 percent, up from 0.71 percent in the third quarter of last year, the firm said.
Lowe's 3Q net income climbs on fewer charges
NEW YORK (AP) – Lowe's Cos.' said Monday that its third-quarter net income surged 76 percent, helped by lower costs and higher revenue, as the company's efforts to revamp its merchandise and prices appeared to gain traction.
Its adjusted earnings without charges and its revenue both beat Wall Street forecasts. Its shares rose over 6 percent Monday.
Lowe's has been retooling its pricing strategy, and last summer returned to offering permanent low prices on many items across the store, instead of offering fleeting discounts. But the changes have been slow to catch on, and last quarter Lowe's said it could take until the middle of next year to reap the benefits of the strategy.
Judge asks Hostess to mediate with union
WHITE PLAINS, N.Y. (AP) – Twinkies may not die that easily after all.
Hostess Brands Inc. and its second largest union will go into mediation to try to resolve their differences, meaning the company won't go out of business just yet. The news came Monday after Hostess moved to liquidate and sell off its assets in bankruptcy court because of mounting debts and a crippling strike.
The bankruptcy judge hearing the case said Monday that the parties haven't gone through the critical step of mediation and asked the lawyer for the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, which has been on strike since Nov. 9, to ask the union if it would agree to participate. The judge noted that the bakery union, which represents about 30 percent of Hostess workers, went on strike after rejecting the company's latest contract offer, even though it never filed an objection to it.
Oil up on Middle East fears, `fiscal cliff' hopes
NEW YORK (AP) – The price of oil closed above $89 a barrel, at its highest point in nearly a month Monday on rising concerns about the Middle East and less worry about the U.S. "fiscal cliff."
President Barack Obama and leaders of the House and Senate appeared to have constructive discussions Friday to avoid a series of automatic tax increases and spending cuts scheduled to kick in on Jan. 1 in the absence of government action. Economists have been warning of dire consequences if no action is taken, including the possibility of another recession.
Overseas the escalating conflict between Israel and Hamas raised concerns about Middle East crude supplies. Analysts say supplies could be disrupted if the conflict engulfs countries elsewhere in the Middle East, which produces more than a third of the world's oil.
Total sells Nigeria offshore oil stake for $2.5 billion
LAGOS, Nigeria (AP) – French oil company Total SA said Monday it sold its stake in an offshore oil field near Nigeria for $2.5 billion to the Chinese state-run firm Sinopec Corp., a sign of China's growing stakes in West African oil production.
The field includes Total's deep-water Usan production operation, which opened earlier this year and has a production capacity of 180,000 barrels a day. Production had been ramping up and is currently around 130,000 barrels a day, a Total spokesman said.
The Usan facility has storage capacity of 2 million barrels. The field is about 62 miles off Nigeria's southeast coast.
GM opens new plant for Chinese budget brand Baojun
HONG KONG (AP) – General Motors Co. and its local Chinese partners have launched a second plant to make cars for its local discount brand Baojun, ratcheting up the battle for customers at the fast-growing lower end of the world's biggest auto market.
The SAIC-GM-Wuling joint venture opened the factory on Sunday in southwestern Guangxi province. GM and its partners have invested 8 billion yuan ($1.3 billion) in the facility, which will be capable of turning out up to 400,000 vehicles a year.
The joint venture is also building a powertrain factory at the plant that will produce up to 400,000 engines a year. It's scheduled to open in September.
By The Associated Press(equals)
The Dow finished up 207.65 points, or 1.7 percent, at 12,795.96. The Standard & Poor's 500 index rose 27.01 points, or 2 percent, to 1,386.89. The Nasdaq composite average gained 62.94, or 2.2 percent, to 2,916.07.
Benchmark crude rose $2.36, or 2.3 percent, to finish at $89.28 per barrel in New York. Brent crude, used to price international varieties of oil, rose $2.75, or 2.5 percent, to end at $111.70 per barrel in London.
Wholesale gasoline rose 4 cents to finish at $2.75 a gallon. Heating oil gained 9 cents, or 3 percent, to end at $3.08 a gallon. Natural gas fell 7 cents to finish at $3.72 per 1,000 cubic feet.