The Associated Press
European bank willing to buy bonds to save euro
FRANKFURT, Germany (AP) - The European Central Bank is preparing to unleash its financial might and buy government bonds to help drive down borrowing costs in debt-ridden countries like Spain and Italy, caught in the grip of what president Mario Draghi called a "worsening crisis."
Draghi urged leaders of the 17 countries that use the euro to use their bailout fund to take the same action, sending a clear message: Europe's financial crisis requires more forceful remedies than leaders have so far been able to muster.
The move towards bond buying came a day after the Federal Reserve hinted it was leaning toward further action to stimulate U.S. growth, highlighting the growing pressure on central bankers to rescue weak economies across the globe.
With no concrete action in Europe, stocks slump
NEW YORK (AP) - European leaders on Thursday gamely promised to keep tackling the continent's debt crisis. But the markets wanted much more.
Stocks sank across the U.S. and Europe, the euro fell against the dollar and investors dumped bonds issued by the governments of Spain and Italy. Investors hoped for more immediate action from the European Central Bank and were disappointed by the plan's lack of details, especially considering the ECB president's pledge last week to do "whatever it takes" to keep the euro intact.
It was the second day in a row that markets were disappointed by a lack of decisive action from a major central bank. On Wednesday, stocks closed lower after the Federal Reserve made only vague promises about its plans to revive the U.S. economy.
GM 2Q profit falls 41 pct. as CEO promises fixes
DETROIT (AP) - The engine that powers General Motors is running rough. And if the company doesn't tune it up soon, GM's comeback from bankruptcy is in danger of stalling.
The Detroit automaker said Thursday that its second-quarter net profit fell 41 percent on a big loss in Europe. And there are signs that North America, GM's main income source, also is slowing. Profits there have fallen for two straight quarters, the first time that's happened since the company left bankruptcy in 2009.
The results are another sign that the U.S. auto industry, a bright spot in the economy for two years, is heading into a rough patch.
Shoppers' spending a bright note for economy
NEW YORK (AP) - Shoppers showed some spending muscle in July, once summer clearance sales and the hottest July in 50 years got them in the mood.
Solid sales reports from retailers Thursday took some of the sting out of weak June manufacturing data. And improving trends in unemployment benefit applications provide hope for slightly better job growth in coming months a day before the government reports on July employment.
U.S. retailers reported better-than-expected July revenue in stores open at least a year, an encouraging sign at the beginning of the back-to-school season, the second-biggest shopping season behind the holidays.
House passes livestock disaster relief bill
WASHINGTON (AP) - The House on Thursday extended disaster assistance to livestock producers reeling from rising feed prices caused by the drought that has scorched much of the nation.
The 223-197 vote to revive expired disaster relief programs for cattle and sheep producers was one of the House's last actions before lawmakers left for their five-week August recess.
The Senate did not act on the bill as it wrapped up its pre-recess work, and Democratic opponents characterized the legislation as cover for Republicans having to explain to rural constituents why they put off action on a comprehensive five-year farm policy bill.
US rate on 30-year mortgage rises to 3.55 percent
WASHINGTON (AP) - The average U.S. rate on the 30-year fixed mortgage rose this week after falling to new record lows in each of the past four weeks.
Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan jumped to 3.55 percent. That's up from 3.49 percent last week, which was the lowest since long-term mortgages began in the 1950s.
The average rate on the 15-year fixed mortgage, a popular refinancing option, increased to 2.83 percent. That's above last week's record low of 2.80 percent.
Bristol-Myers executive charged with insider trading
NEWARK, N.J. (AP) - A Bristol-Myers Squibb executive took advantage of his high-level position and access to nonpublic information to make $310,000 from illegal insider trades, federal prosecutors and Securities and Exchange officials said Thursday.
Robert Ramnarine was arrested Thursday morning by the FBI and was charged with three counts of using nonpublic information on companies his employer was considering buying to make stock trades.
In each case, federal authorities said, Ramnarine was able to use inside knowledge to take advantage of something that almost always happens when a big company announces plans to acquire a smaller one: The smaller company's stock price shoots up.
Kellogg 2Q adjusted profit beats Street, revenue up
NEW YORK (AP) - Escalating commodity costs and ongoing weakness in Europe drove Kellogg's second-quarter net income down 12 percent Thursday. But adjusted results topped Wall Street's view and the food maker's one-two punch of breakfast goods and snacks gave a lift to revenue, driven by sales of Pop-Tarts and strength in North America.
Kellogg Co. has long been known to consumers for its morning wake-up foods like Frosted Flakes cereal and Eggo waffles. But the company is aggressively building its snacks business as well, with hopes that its recent $2.7 billion acquisition of Pringles from Procter & Gamble Co. will make it a global player in that market. The snacks division already includes Cheez-It, Keebler's Club crackers and Special K crackers.
With consumers busier than ever and worried about the economy and high unemployment, on-the-go foods like Pop-Tarts and Pringles potato snacks are proving popular because they are relatively inexpensive and easily portable foods.
Kraft Foods profit up in 2Q, stands by forecast
NORTHFIELD, Ill. (AP) - Kraft Foods Inc.'s second-quarter profit jumped more than 5 percent despite a drop in sales as higher prices helped offset rising raw-materials costs and unfavorable currency exchange rates.
The food maker reported that it earned $1.03 billion, or 58 cents per share, for the quarter. That's up from $976 million, or 55 cents per share, last year.
Adjusting for one-time items, Kraft earned 68 cents per share versus 62 cents. That topped the 66 cents a share expected by Wall Street.
Revenue fell 4 percent to $13.29 billion, below expectations.
LinkedIn 2Q net income falls, revenue soars
NEW YORK (AP) - LinkedIn's net income fell in the latest quarter as the professional networking site spent more money to grow its business. But revenue grew from subscription fees and advertising grew faster than expected, and the company raised its forecast for the year.
LinkedIn's stock rose after the results came out Thursday, a reprieve after tepid news from other newly public Internet companies - namely Facebook and Zynga. LinkedIn, which went public more than a year ago, is among the best-performing of the new public companies, with its stock at more than twice the level of its IPO price at a time when Facebook is nearing half.
The results indicate that LinkedIn is playing a greater role in the employment market as millions more people look to find jobs and network online if they do have jobs. LinkedIn said it had 174 million members at the end of the quarter, up 50 percent from a year earlier. Most of the growth in the second quarter came from overseas as LinkedIn continued to expand outside of the U.S.
By The Associated Press(equals)
The Dow Jones industrial average fell 92.18 points to 12,878.88. The Standard & Poor's 500 index fell 10.14 to 1,365. The Nasdaq composite index lost 10.44 to 2,909.77.
Benchmark U.S. crude fell $1.78 to end the day at $87.13 per barrel in New York.
Natural gas dropped 25.1 cents, or 8 percent, to end at $2.92 per 1,000 cubic feet.
In other futures trading, heating oil lost 1.65 cents to finish at $2.8423 per gallon, while wholesale gasoline rose 3.54 cents to end at $2.8696 per gallon.
Brent crude, which helps set the price for imported oil, lost 6 cents to end at $105.90 per barrel in London.