Fed cites moderate US growth, takes no new action
WASHINGTON (AP) — Two weeks before a U.S. election focused on the economy, the Federal Reserve said Wednesday that its help is still needed to increase growth and lower unemployment.
The Fed took no action after a two-day policy meeting. It wants time to assess whether the aggressive steps it launched in September will help the economy.
Last month, the Fed began buying mortgage bonds to try to push long-term interest rates lower and make home buying more affordable. It also said it planned to keep its benchmark short-term rate near zero through mid-2015.
Facebook shares post biggest single-day gain
NEW YORK (AP) — Facebook's stock gained the most in a single day Wednesday since it began trading in May, a sign that the social media company's complicated relationship with Wall Street may be getting brighter.
It's been a rough five months since the social network's initial public stock offering, and it's too early to tell whether investors' optimism is here to stay. But on Wednesday they latched on to clear signs of growth in the company's third-quarter earnings report. Several analysts upgraded the stock.
Besides posting quarterly results that inched past Wall Street's expectations, Facebook on Tuesday also gave details for the first time on how much money it made from mobile ads. This has been a concern since before its IPO. Although the majority of 1 billion people who use Facebook each month now access it using a mobile device, the 8-year-old company was created in the age of desktop computers, for Web pages. Facebook now calls itself a "mobile-first" company, but it only started showing mobile ads earlier this year.
Bailout, layoffs: New pain ahead for EU carmakers
PARIS (AP) — The extent of the European car industry's troubles was laid bare Wednesday, when France's government tossed a financial lifeline to the continent's No. 2 automaker, Peugeot Citroen, and Ford said it would shut a plant in Belgium, cutting 9,500 jobs.
Experts say France's €7 billion ($9.1 billion) bailout, a three-year loan guarantee, represents a desperate attempt to avoid the sort of layoffs that companies like Ford are slowly accepting as inevitable.
The problem is the region's carmakers are selling too few cars in Europe, where the financial crisis has caused demand to dry up, and have too many factories. Even Germany's automakers, which had weathered the economic downturn relatively well, are not immune.
Gas gets cheaper, but still isn't cheap
NEW YORK (AP) — Gasoline across the U.S. is cheaper after a week of rapid price declines. But it still isn't cheap.
The national average for a gallon of gas has dropped 13 cents in the past week to $3.625. That's the biggest weekly decline since the 7-day period ended Nov. 28, 2008, according to Oil Price Information Services analyst Fred Rozell.
Falling oil prices, rising supplies of gasoline and a switch by refiners to cheaper winter blends of gas have contributed to lower pump prices.
But gas is still more expensive than it's ever been for this time of year. The previous record for Oct. 23 was last year's $3.46 per gallon.
US new-home sales rise to highest in 2½ years
WASHINGTON (AP) — U.S. sales of new homes jumped last month to the highest level in more than two years, further evidence of a sustained housing recovery that could help lift the lackluster economy.
The Commerce Department said Wednesday that new home sales rose 5.7 percent in September to a seasonally adjusted annual rate of 389,000. That's up from a rate of 368,000 in August and the highest rate since April 2010, when a federal homebuyer tax credit inflated sales.
Sales have risen 27.1 percent in the past year. That's the strongest yearly gain since February, although sales are still well below healthy levels
Buffett says US economy still inching ahead
OMAHA, Neb. (AP) — Billionaire investor Warren Buffett said Wednesday that the global economy is definitely slowing because of continued problems in Europe and the decline in Asia.
But he said that the U.S. economy is still improving modestly and business will improve regardless of who wins the presidential election.
Buffett said that while the U.S. economy is outperforming those in Europe and Asia, American businesses would be performing better if leaders would address the nation's fiscal problems.
Boeing benefits from faster airplane deliveries
Boeing is cranking out planes faster, and it's paying off.
The big U.S. aerospace company is on track to meet delivery targets for the year, and on Wednesday raised its profit guidance and reported a better-than-expected profit for the third quarter.
Boeing has been speeding up production, aiming to get some of its newest planes out the door faster. Its new 787 is getting the most scrutiny because it was three years late when it began hauling passengers last year.
Much of a new plane is paid for at delivery, so faster deliveries mean better cash flow. Boeing's revenue from commercial planes jumped 28 percent to $12.19 billion in the most recent quarter.
US Airways posts record 3Q profit
DALLAS (AP) — US Airways turned in a strong performance during a three-month stretch that covers much of the peak summer vacation season.
Net income for the third quarter was a record $245 million, or $1.24 per share, compared with $76 million, or 41 cents per share, a year earlier, the airline said Wednesday.
The results are especially important to US Airways Group Inc. as it pursues a merger with American Airlines. US Airways, the nation's fifth-biggest airline, is trying to impress American's creditors that a combined company would be more successful than American can become on its own.
Delta 3Q profit surges on fuel contract gains
NEW YORK (AP) — Delta Air Lines said Wednesday that its third-quarter profit nearly doubled mostly due to the increasing value of its fuel contracts.
The world's second-largest airline earned $1.05 billion, or $1.23 per share, compared with $549 million, or 65 cents, a year earlier. Excluding one-time items, it earned $768 million or 90 cents — just shy of Wall Street expectations of 91 cents.
Revenue rose 1 percent to $9.92 billion, also just under analysts' estimate of $9.93 billion, according to FactSet. The Atlanta-based airline says revenue was driven by its effort to trim seats according to demand. As it scaled back capacity, flights were slightly fuller.
Ex-Goldman exec given 2 years for inside trades
NEW YORK (AP) — A former Goldman Sachs and Procter & Gamble Co. board member was sentenced to two years in prison Wednesday, culminating a spectacular fall from grace for a man who retained support from prominent business and civic leaders even after he was convicted of feeding inside information about board dealings to a billionaire hedge fund owner who was his friend.
Rajat Gupta, 63, of Westport, Conn., learned his fate from U.S. District Court Judge Jed Rakoff, who defended his leniency, blasting federal sentencing guidelines that called for Gupta to serve at least 6½ years behind bars. He also ordered him to pay a $5 million fine.
Citing information he received under seal, Rakoff said Gupta's crimes may have occurred because Gupta may have "longed to escape the straightjacket of overwhelming responsibility, and had begun to loosen his self-restraint in ways that clouded his judgment."
By The Associated Press(equals)
The Dow Jones industrial average closed down 25.19 points at 13,077.34. The Standard & Poor's 500 index fell 4.36 points to close at 1,408.75 while the Nasdaq composite index fell 8.76 points to 2,991.70.
Benchmark oil fell 94 cents, or about 1 percent, to finish at $85.73 per barrel. Brent crude fell 40 cents to end at $107.85 per barrel in London.
Wholesale gasoline fell less than a penny to finish at $2.60 per gallon. Heating oil also fell less than a penny to end at $3.04 per gallon. Natural gas fell 8.5 cents to finish at $3.45 per 1,000 cubic feet, reversing Tuesday's gains.