Trade gap widens as imports and exports both rise WASHINGTON (AP) â¿¿ The trade deficit rose in May to an 18-month peak as rising imports offset another solid gain in U.S. exports. The surge in imports was a hopeful sign for the economic recovery because it suggested businesses are optimistic that U.S. consumers will spend more in coming months. The trade gap grew 4.8 percent to $42.3 billion, the largest deficit since November 2008, the Commerce Department said Tuesday. U.S. exports of goods and services rose 2.4 percent to $152.3 billion. It was the largest monthly total since September 2008, the month the financial crisis struck with force. ___ Stocks surge after Alcoa, CSX report strong profit NEW YORK (AP) â¿¿ The stock market got a shot of confidence and adrenaline from the start of second-quarter earnings season. Investors were enthusiastic Tuesday about better-than-expected profits from aluminum maker Alcoa Inc. and railroad operator CSX Corp. The Dow Jones industrial average rose more than 145 points and the major indexes were up well over 1 percent. The companies, among the first to report second-quarter earnings, also issued upbeat forecasts for the rest of the year. That was heartening news for investors who have been concerned that the recovery was stalling, or that the economy might even fall back into recession. ___ Job openings drop in May as hiring stays weak WASHINGTON (AP) â¿¿ Job openings dropped in May from the previous month and layoffs edged up, fresh evidence that employers are reluctant to add workers. The decline in job openings comes after a sharp rise the previous two months, driven by temporary government hiring for the 2010 census and more openings in the private sector. As a result, the number of available jobs has rebounded since the depths of the recession but remains well below pre-recession levels.
The Labor Department said Tuesday that job openings fell to 3.2 million in May from 3.3 million in the previous month. April's upwardly revised figure was the highest in 18 months.___ Federal budget gap tops $1 trillion through June WASHINGTON (AP) â¿¿ The federal deficit has topped $1 trillion with three months still to go in the budget year, showing the lasting impact of the recession on the government's finances. In its monthly budget report, the Treasury Department said Tuesday that through the first nine months of this budget year, the deficit totals $1 trillion. That's down 7.6 percent from the $1.09 trillion deficit run up during the same period a year ago. Worries about the size of the deficit have created political problems for the Obama administration. Congressional Republicans and moderate Democrats have blocked more spending on job creation and other efforts. Republicans also have held up legislation to extend unemployment benefits for the long-term jobless because of its effect on the deficit. ___ Intel posts biggest profit in a decade SAN FRANCISCO (AP) â¿¿ Intel Corp. posted its largest income in a decade Tuesday as the company benefits from a strengthening computer market and more sophisticated factories. The results topped Wall Street's forecasts, and Intel raised its guidance, but that may not be enough to quell fears about cracks in the computer industry's recovery amid fresh economic worries. Intel reported after the market closed Tuesday that net income was $2.89 billion, or 51 cents per share, in the quarter ended June 26. That compares with a loss of $398 million, or 7 cents per share, a year ago, when Intel was forced to pay a $1.45 billion fine in Europe over antitrust violations. ___ BP partner refuses to help pay for Gulf spill NEW YORK (AP) â¿¿ Both of BP's partners in its blown-out Gulf well have turned their backs on the company, refusing to pay to help clean up.
A BP spokesman said Tuesday that MOEX Offshore 2007 LLC has turned away a $111 million cleanup bill that BP requested last month. The other minority owner, Anadarko Petroleum Corp., refused a $272 million bill from BP last week.MOEX, which owns 10 percent of the well, declined immediate comment. MOEX is owned by Japan's Mitsui Oil Exploration Co. ___ Fed survey: Investors have bigger debt appetite WASHINGTON (AP) â¿¿ Investors are showing a bigger appetite to fund a range of securities, an encouraging sign that credit conditions are improving. The Federal Reserve, in its first such survey, released Tuesday, found that demand has increased over the last three months for funding high-grade corporate bonds, stocks, residential mortgage-backed securities issued by Fannie Mae and Freddie Mac and other asset-backed securities. During the height of 2008 financial crisis, panicked investors lost their appetite to lend against a variety of securities. That cut off the flow of credit to businesses and consumers and plunged the country into the worst recession since the 1930s. ___ Vivus weight loss drug faces FDA panel this week NEW YORK (AP) â¿¿ Vivus Inc.'s experimental drug Qnexa was effective in cutting weight, the Food and Drug Administration said Tuesday, while acknowledging lingering concerns over the drug's nervous system and psychiatric side effects. Still, shares of Vivus jumped as the drug edged closer to approval, potentially the first new prescription drug therapy in more than a decade in the burgeoning obesity market. The FDA raised some concerns in briefing documents posted online on Tuesday about a range of side effects. It said reviewers should take into account rates of depression, memory and concentration lapses, and heart-related issues, among others. The concerns were not a surprise to Wall Street, which has been following development of the drug over the last several years.
___Yum 2Q profit falls but adjusted beats forecasts LOUISVILLE, Ky. (AP) â¿¿ The owner of the Taco Bell, Pizza Hut and KFC fast-food brands says its second-quarter profit dipped slightly this year, but its adjusted results beat Wall Street's expectations. The company raised its full-year outlook. Yum Brands said Tuesday that it earned $286 million, or 59 cents per share, for the quarter. Revenue rose 6 percent to $2.57 billion as it saw strong growth in China. A year earlier, it earned $303 million, or 63 cents per share, including a $68 million one-time gain for increasing and consolidating its stake in KFC in China. ___ Tax-wise, Steinbrenner picked a great year to die CHICAGO (AP) â¿¿ Born on the Fourth of July, George Steinbrenner left the world stage with a great sense of timing too. By dying in 2010, the billionaire and longtime New York Yankees owner's wealth avoids the federal estate tax, likely saving his heirs enough money to field an entire team of Alex Rodriguezes. Steinbrenner's death Tuesday comes during an unplanned gap year in the estate tax, the first since it was enacted in 1916. Political wrangling has stalemated efforts in Congress to replace the tax that expired in 2009. That deprives the government of billions of dollars in annual revenue but represents an unexpected bonanza for the rich and those who inherit wealth. By The Associated Press The Dow rose 146.75, or 1.4 percent, to 10,363.02. The Standard & Poor's 500 index rose 16.59, or 1.5 percent, to 1,095.34, while the Nasdaq composite index rose 43.67, or 2 percent, to 2,242.03. Benchmark crude for August delivery gained $2.20 to settle at $77.15 on the New York Mercantile Exchange. In other Nymex trading, heating oil gained 5.61 cents to settle at $2.0474 a gallon, gasoline rose 5.41 cents to settle at $2.0821 a gallon and natural gas fell 3.4 cents to settle at $4.354 per 1,000 cubic feet.
In London, Brent crude rose $2.28 to settle at $76.65 a barrel on the ICE Futures exchange.