Higher retail spending lifts hopes for US economy
WASHINGTON (AP) Americans increased their retail spending in July by the most in five months, opening their wallets after a frugal spring and offering hope that the slumping economy may rebound in the second half of the year.
Retail spending rose in every major category, from electronics and sporting goods to furniture, building supplies and garden equipment. The report from the government followed one earlier this month that showed hiring strengthened in July.
Overall retail sales rose 0.8 percent from June to July, the Commerce Department said. It was the sharpest increase since February, and it followed three months of declines.
Home Depot sees signs of improving housing market
ATLANTA (AP) The Home Depot Inc. is feeling more optimistic about the recovery of the housing market after customers spent more on sprucing up their homes in the second quarter.
The country's biggest home-improvement retailer said Tuesday that strong cost controls and healthy sales of paint, bathroom accessories and kitchen installations helped lift its net income by 12 percent during the period.
The Atlanta-based company boosted its full-year outlook.
Luxury cars do poorly in new crash tests
DETROIT (AP) Most midsize luxury cars including the Mercedes-Benz C-Class performed poorly in a new frontal crash test developed by the Insurance Institute for Highway Safety.
The new test is designed to replicate what happens when a car strikes another car or a fixed object like a tree or utility pole. The test strikes 25 percent of a car's front end into a five-foot rigid barrier at 40 miles per hour.
The results don't bode well for non-luxury models, which will be the next to undergo the new test. Insurance Institute crash test results are closely watched by the auto industry and often lead to changes in design or safety features. Good scores are also frequently touted in car ads.
NY regulator says bank settles Iran money probe
ALBANY, N.Y. (AP) New York's financial regulator said Tuesday that his agency has reached a $340 million settlement with Standard Chartered Bank to resolve an investigation into whether the British bank schemed with the Iranian government to launder $250 billion from 2001 to 2007.
The bank will pay the civil penalty to the state and will strengthen oversight of overseas transactions, New York Superintendent of Financial Services Benjamin Lawsky said.
Standard Chartered spokeswoman Julie Gibson noted the New York announcement set out the terms of an agreement, including payment of $340 million, and a formal agreement is expected shortly.
Europe on the edge of recession
LONDON (AP) Europe is edging closer to recession, dragged down by the crippling debt problems of the 17 countries that use the euro, official figures showed Tuesday.
Eurostat, Europe's statistics agency, revealed that the economies of both the eurozone and the European Union, which has 27 countries, shrank by a quarterly rate of 0.2 percent in the second quarter of the year. In the first quarter, output for both regions was flat. A recession is officially defined as two straight quarters of falling output.
Europe's debt woes have been blamed for the sharp deterioration in the global economic outlook over the last few months. The region is the U.S.'s largest export customer and any fall-off in demand will hit order books.
Chinese companies pull out of US stock markets
BEIJING (AP) Just a few years after Chinese companies lined up to sell shares on Wall Street, a growing number are reversing course and pulling out of U.S. exchanges.
This week, Focus Media Holding Ltd., announced its chairman and private equity firms want to buy back its U.S.-traded shares and take the Shanghai-based advertising company private. The deal would value Focus Media at $3.5 billion, according to financial information firm Dealogic.
Smaller companies also are withdrawing from U.S. exchanges. A Chinese business magazine says a state bank has provided $1 billion in loans to help companies with listings abroad move them to domestic exchanges.
Farm subsidies, FBI, air controllers face big cuts
WASHINGTON (AP) Come January, be prepared for fewer air traffic controllers, FBI agents, border patrol officers and park rangers, as well as lower farm and winter heating subsidies. Less meat might get inspected. Furloughs will likely sweep across the government. Even the weather service could be affected.
The looming funding crisis in domestic spending is the result of automatic across-the-board cuts that go into effect Jan. 2 because of Washington's inability so far to reach a budget deal for achieving less red ink in the future.
The idea behind the automatic cuts, called a sequester in Washington parlance, was to force Republicans and Democrats to agree on a deal to slash out-of-control deficits that currently require the government to borrow 33 cents of every dollar it spends. The sequester was intentionally designed to be harsh if negotiators couldn't agree and they haven't yet.
US wholesale prices rose 0.3 percent in July
WASHINGTON (AP) U.S. wholesale prices increased in July from June. Higher auto and food costs were offset by a drop in energy prices.
The producer price index, which measures price changes before they reach the consumer, increased a seasonally adjusted 0.3 percent last month, the Labor Department reported Tuesday. That followed a 0.1 percent gain in June.
Overall, inflation remains tame. That gives the Federal Reserve more leeway to keep interest rates low in an effort to spur economic growth.
Toyota Camry sales rise, attracting younger buyers
DETROIT (AP) A revamped Camry sedan is selling briskly, and attracting a far younger buyer than Toyota ever expected, a top executive said Tuesday.
The top-selling car in the U.S. was reworked for the 2012 model year to make it more stylish, luxurious, and fun to drive, Bob Carter, Toyota's senior vice president of automotive operations in the U.S., told analysts and investors at the J.P. Morgan Auto Conference in New York. Sales are up almost 40 percent this year to nearly 244,000 cars. That's 60,000 more than the Camry's two closest competitors, the Honda Accord and Nissan Altima.
Rising Camry sales are another sign that Toyota has recovered from last year's earthquake and tsunami that hobbled its factories and caused model shortages worldwide. Sales of the Toyota, Lexus and Scion brands are up 28 percent so far this year, reaching more than 1.2 million vehicles. The company has taken back sales from GM, Ford and others.
Saks posts 2nd-quarter loss on charges
NEW YORK (AP) Saks Inc.'s loss widened in the second quarter from a year ago, as results were dragged down by charges related to closing stores and opening a fulfillment center in Tennessee.
But the luxury department store chain, which operates Saks Fifth Avenue, reiterated its sales forecast for the second half of the year, underscoring how wealthy shoppers are proving to be resilient in a yo-yo economy.
Like many luxury retailers, Saks has seen its affluent shoppers return to spending freely on status goods since the recession. Still, the volatility in the stock market and the financial crisis in Europe are creating some challenges. Earlier in the spring, Saks had to step up discounting, but the latest results, which beat Wall Street estimates, show solid spending by its wealthy clientele.
By The Associated Press(equals)
The Dow Jones industrial average closed up 2.71 points at 13,172.14. The broader Standard & Poor's 500 index lost 0.18 point to 1,403.93 and the Nasdaq composite index fell 5.54 points to 3,016.98.
Benchmark crude rose 70 cents to finish at $93.43 a barrel in New York. Brent crude, which is used to price international varieties of oil, rose 43 cents to end at $114.03 a barrel on the ICE Futures exchange in London.
Wholesale gasoline rose 1.07 cents to finish at $3.0014 a gallon. Heating oil rose 1.63 cents to end at $3.0346 a gallon. Natural gas gained 10.5 cents to finish at $2.8340 per 1,000 cubic feet.