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Major companies due to report earnings after the 16:00 close of regular trading in New York: Yum! Brands Inc. (YUM)
U.S. Stocks Fall as Europe Concern Offsets Bernanke Statement
U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for a third day, as concern over Europe’s debt crisis offset optimism that the Federal Reserve would act further to boost the economy. Developing. US-STOCKS-FINAL to move by 17:00. WRAP, US-OIL-MARKET.
Bernanke Says Fed Ready to Take Further Action to Aid Growth
Federal Reserve Chairman Ben S. Bernanke said the central bank stands ready to take additional steps to boost U.S. growth and cautioned lawmakers against budget moves that would harm a “sluggish” recovery.
The Fed “will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in a context of price stability,” Bernanke said today in testimony to Congress’s Joint Economic Committee in Washington.
The remarks signal Bernanke may not be finished after attempts in August and September to strengthen record monetary stimulus with unconventional tools. 1290. Moved at 12:00. By Scott Lanman.
PHOTOS: Bernanke’s appearance before the congressional committee in Washington.
Apple May Unveil Voice-Recognition Technology for New IPhone
Apple Inc.’s next iPhone, due to be unveiled at an event today, may be a showcase for improved voice controls, bringing phones closer to the realm of “Star Trek”-style speech recognition.
New voice commands will let users make appointments in their calendars, send text messages or e-mails, and surf the Web, said Gene Munster, an analyst at Piper Jaffray Cos. Apple already has basic voice-control abilities on the iPhone for placing a call or accessing a song. Today’s event is called “Let’s talk iPhone,” hinting at an expansion of the features. Developing. Apple presentation began at 13:00. By Adam Satariano.
Airlines Mired in ‘Crisis’ as Margins Shrink, IATA CEO Says
Airline profits forecast to total $28 billion in the three years through 2012 may be unsustainable as over-capacity and looming regulatory costs weigh on margins, the head of the IATA industry association said.
Airlines will generate net income equal to 0.8 percent of revenue next year, a margin that may shrink further if economic growth slows to less than 2.4 percent, Tony Tyler, chief executive officer of the International Air Transport Association since July 1, said in an interview in London. 1240. Moved at 12:30. By Steve Rothwell and Mathew Carr.
Ford Said to Pay UAW Members $9,700 in Bonuses This Year
Ford Motor Co. will pay most of its United Auto Workers- represented employees a $6,000 signing bonus and $3,700 in additional profit sharing this year, people familiar with terms of their tentative four-year agreement said.
Workers with a year or less of service will get a $5,000 signing bonus, said three people familiar with the agreement who asked not to be identified before the union announces the details. Ford will also make annual $1,500 payments to its UAW workers, which take the place of cost-of-living adjustments in their pay, one of the people said.
Ford committed to adding 12,000 hourly jobs in its U.S. manufacturing plants by 2015 as part of the agreement, the Dearborn, Michigan-based company said this morning. The figure includes 5,750 more UAW jobs than a previously announced 6,250 hourly positions to be added by the end of 2012, Executive Vice President John Fleming said at a news conference. 420. Moved at 12:05. By Keith Naughton and Craig Trudell.
BMW Dangles 19% Discounts as China’s Luxury Market Cools: Cars
China is turning into a buyer’s market for luxury cars as dealers for Bayerische Motoren Werke AG, Daimler AG and Volkswagen AG’s Audi offer discounts to maintain sales as demand cools.
In Beijing, BMW dealerships are giving markdowns of as much as 19 percent on a 3-series car, while some Mercedes dealers are selling the C-Class Elegance model at 20 percent less than the suggested retail price, according to cheshi.com, a pricing guide tracking more than 3,000 dealers in the country.
BMW, Daimler and Audi, the three largest luxury carmakers, face slowing sales growth and falling prices in China, the world’s largest automobile market, as some cities impose driving curbs and the central bank tightens lending. The growth in demand for high-end vehicles cooled to 29 percent the first eight months of this year from 48 percent in 2010, according to researcher J.D. Power & Associates. 1120. Moved at 13:15. By Bloomberg News.
Silver Lake Said to Review Yahoo Deal With Alibaba, DST
The private-equity firm Silver Lake, Alibaba Group Holding Ltd. and Russia’s Digital Sky Technologies are discussing a possible joint bid for Yahoo! Inc., three people with direct knowledge of the matter said.
The group contacted Yahoo and its advisers in recent weeks to inform them of a possible offer, said one of the people, who declined to be identified because the talks are private. The discussions are still at an early stage and it’s not certain that the group will agree to make a bid, the people said.
Alibaba Chairman Jack Ma said last week he is “very interested” in buying Yahoo, six years after selling a 40 percent stake in China’s biggest e-commerce company to the owner of the most-visited U.S. Web portal. Yahoo is reviewing its strategy to revive growth and attract more users after firing Chief Executive Officer Carol Bartz last month. 740. Moved at 9:50. By Douglas MacMillan and Jeffrey McCracken.
France, Belgium Pledge Dexia Help as Lender Weighs Breakup
The French and Belgian governments pledged to support Dexia SA as shares of the lender plunged in Brussels on concern it will require a second government bailout.
France and Belgium will take “all necessary measures” to protect clients and will guarantee all Dexia’s loans, French Finance Minister Francois Baroin and Belgian Finance Minister Didier Reynders said in a statement today. Belgium’s cabinet will meet in Brussels tonight to review the options for the lender. Both governments have stakes in the bank following its bailout in 2008. 1320. Moved at 12:55. By Fabio Benedetti- Valentini and John Martens.
Orders for U.S. Capital Goods Rise by Most in Three Months
Orders for U.S. capital equipment increased in August by the most in three months, a sign business investment and exports held up in the face of mounting concern over the European debt crisis.
Bookings for goods like computers and communications gear, excluding military hardware and aircraft, climbed 0.9 percent, the most since May, a Commerce Department report showed today in Washington. Demand for all factory goods declined 0.2 percent. 820. Moved at 10:15. By Bob Willis.
TOP GENERAL NEWS
India, Afghanistan Sign Strategic Pact Amid Strain With Pakistan
India and Afghanistan signed a strategic partnership agreement that officials of their governments say will allow for Indian training of Afghan troops in coming years, a step that may exacerbate the two countries’ tensions with Pakistan.
Afghan President Hamid Karzai and India’s Prime Minister Manmohan Singh signed the accord in New Delhi a day after Karzai accused Pakistan in a televised speech of foiling his attempts to make peace with Taliban insurgents by secretly backing their war effort. While U.S.-led forces currently train Afghan troops, their main combat force is scheduled to withdraw by 2014 and Karzai also wants Indian help, his spokesman, Hamed Elmi, told Afghanistan’s Tolo TV yesterday.
After years in which Karzai kept India at arm’s length on security issues in Afghanistan, his willingness to seek military training “is a joint message he and the Americans are sending to Pakistan that, if you don’t come on board and stop supporting these guerrillas, we have an option to strengthen ties with India,” said Amin Saikal, an Afghan political scientist at Australian National University. 730. Moved at 11:45. By Eltaf Najafizada and James Rupert.
Libya’s Oil Output Rising; Second Largest Refinery Restarts
Libya aims to raise crude oil output to more than 500,000 barrels a day by the end of October, the chairman of state-run National Oil Corp. said as the North African nation resumed operations at the Zawiya refinery, its second-largest.
Damage to energy infrastructure probably amounts to less than $1 billion and mostly affects non-production facilities such as worker housing, Nuri Berruien said yesterday in an interview in the Libyan capital Tripoli. The country’s goal of restoring crude production to 1.7 million barrels a day within 15 months is a “conservative figure,” he said. 750. Moved at 4:00. By Robert Tuttle.
Scientists Win Physics Nobel for Dark Universe Discovery
Three scientists won the Nobel Prize in Physics for discovering that the universe’s expansion is accelerating, shattering their own expectations and raising questions about the dark energy behind the surge.
Saul Perlmutter, 52, of the University of California at Berkeley will get half of the 10 million-Swedish-kronor ($1.5 million) prize, while Brian P. Schmidt, 44, of the Australian National University in Canberra and Adam G. Riess, 41, of Johns Hopkins University in Baltimore will split the rest, the Royal Swedish Academy of Sciences said today in Stockholm. 560. Moved at 7:40. By Simeon Bennett, Andrea Gerlin and Janina Pfalzer. Also see STEINMAN-NOBEL-PRIZE.
Christie Won’t Seek Republican Presidential Bid in 2012
New Jersey Governor Chris Christie, who spent more than a year denying he’d run for president in 2012, said he won’t join the race to challenge President Barack Obama.
The 49-year-old Republican, who has been considering making a bid in recent days, announced the decision during a news conference at the state capitol in Trenton. 520. Moved at 13:15. By Terrence Dopp.
Sensitive U.S. Data Imperiled by Agencies’ Weak Cyberdefenses
U.S. government agencies’ failure to meet the requirements of a 2002 information-security law are putting sensitive federal data and computer systems at risk, according to congressional auditors.
Reports of security incidents at 24 agencies have increased more than sevenfold over the past five years, according to a Government Accountability Office report released yesterday. The agencies haven’t fully implemented security measures mandated under the law, according to the report, which was sent to the Senate Committee on Homeland Security and Governmental Affairs and the House Committee on Oversight and Government Reform. 980. Moved at midnight. By Juliann Francis.
Washington Ban on Assault Weapons Constitutional, Court Says
Washington, D.C.’s ban on assault weapons and large- capacity magazines doesn’t violate the constitutional rights of residents in the U.S. capital, a federal appeals court ruled.
The U.S. Court of Appeals in Washington today also upheld registration requirements for handguns put in place after a landmark U.S. Supreme Court decision in 2008 ended the city’s almost total ban on firearms. The three-judge panel ordered a lower court to further review other aspects of Washington’s gun control law, such as its limits on multiple purchases. 250. Moved at 11:10. By Tom Schoenberg.
TSA Says Select Travelers May See Speedier Airport Checks
The U.S. Transportation Security Administration today began a program aimed at speeding the most frequent travelers through airport checkpoints without the usual security measures such as removing shoes.
The pilot program, called PreCheck, is at four airports, in Miami, Dallas, Detroit and Atlanta, and includes only travelers who have been invited by the TSA and approved after background checks. 550. Moved at 11:30. By Julie Bykowicz.
Contraceptive Injections Double HIV Infection Risk in Study
Using contraceptive injections such as Pfizer Inc.’s Depo Provera doubles the chance women will catch HIV and transmit it to a male partner, a study found.
Researchers from the University of Washington in Seattle followed 3,790 African couples in which one partner was infected with the AIDS-causing virus. Women who used hormone-based contraceptive injections were twice as likely to acquire and pass on HIV as those who didn’t, the researchers wrote today in the journal The Lancet Infectious Diseases. A higher risk was also observed for birth-control pills, but that finding wasn’t statistically significant, the researchers said. 310. Moved at 11:00. By Simeon Bennett.
Elderly Drug Abusers Get Narcotics From Medicare, Senators Say
Elderly drug abusers may be costing taxpayer-funded Medicare almost $150 million a year by convincing doctors to write prescriptions for oxycodone and other narcotics, a Senate report found.
About 170,000 patients in Medicare, the federal health program for the elderly and disabled, acquired often-abused drugs from at least five doctors each in 2008, according to a report issued today by Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper, a Delaware Democrat, and the panel’s senior Republican, Scott Brown of Massachusetts. 330. Moved at 11:10. By Alex Wayne.
BUSINSES NEWS FEATURES
Crosslink Ventures Turn Into Hedge Fund Bet as Hybrid Firm: Tech
On the eve of its Aug. 11 initial public offering, Carbonite Inc., a Boston-based firm that provides online data backup, cut its offering price to $10 a share from a range of $15 to $17.
Presentations to attract investors had collided with a 2,000-point plunge in the Dow Jones Industrial Average during the previous 14 trading days. Carbonite was determined to go public, even though 10 other companies had postponed their debuts, Bloomberg Markets magazine reports in its November issue.
Michael Stark, who runs San Francisco-based Crosslink Capital Inc., knew Carbonite. He’d invested $12 million in January as part of a venture-capital deal.
After Carbonite lowered its price, Stark placed an order of 1 million shares at the IPO, doubling his stake to 8.3 percent, split between hedge and venture investments. By the closing bell, Carbonite had gained 24 percent to $12.35. The stock climbed further, giving Crosslink a 28 percent return in a month, trouncing the 3.3 percent gain for the Nasdaq Computer Index. On Oct. 3, the shares traded at $12.
Stark’s Carbonite investment is quintessential Crosslink. The firm, with $2.15 billion under management, tries to make money from a hybrid strategy of providing venture funding for private companies and hedge-fund investments to profit from public ones. The setup lets the firm double its bets when it perceives good opportunities. 830. Moved at 9:25. By Kambiz Foroohar.
PHOTO: Michael Stark stands for a portrait in San Francisco on Aug. 26, 2011. Photographer: Emily Shur.
GENERAL NEWS FEATURES
Senate ‘Workhorse’ Murray Must Save Majority While Cutting Debt
Among the 12 members of the congressional deficit-cutting supercommittee, there are committee chairmen, Sunday news show regulars, anti-tax purists, and Patty Murray.
Murray, 60, is not only the lone woman on the panel, she also is the head of the Democratic Senatorial Campaign Committee, which is charged with protecting the party’s Senate majority in the 2012 elections.
The decision by Majority Leader Harry Reid to name the bespectacled Washington senator to serve as the Democratic co- leader of the supercommittee, which held a closed-door meeting last evening, drew criticism among Republicans and government ethics advocates. 1270. Moved at midnight. By Laura Litvan.
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