NEW YORK (AP) â¿¿ ___ Holiday discounts crimp retailers' profits NEW YORK (AP) â¿¿ The 2011 holiday shopping season will go down in the record books as the year the Grinch stole stores' profits. Many retailers sacrificed their bottom lines by pushing heavy discounts to shoppers bent on getting a good deal in a challenging economy. That created a sharp divide between stores that won the battle for wallets, and those that didn't. The big winners? Shoppers who held out for deals late in the season. Retailers collectively reported a 3.5 percent increase in revenue at stores open at least a year for December, according to a tally of 25 merchants compiled by the International Council of Shopping Centers. For November and December combined, the figure rose 3.3 percent, a solid increase but smaller than last year's 3.8 percent rise. ___ GM to add more steel to Volt to protect battery DETROIT (AP) â¿¿ General Motors is advising Volt owners to return their electric cars to dealers for repairs that will lower the risk of battery fires. The company hopes adding steel to the plates protecting the batteries will ease worries about the cars' safety. Three Volt batteries caught fire after government crash tests last year, prompting a federal investigation and sending GM engineers scrambling for a fix. Eligible for the fix announced Thursday are 8,000 Volts on U.S. roads and another 4,400 still for sale. The repairs are covered under a "customer service campaign" run by GM, which is similar to a safety recall but allows the carmaker to avoid the bad publicity and federal monitoring that come with a recall. ___ Euro jitters back amid bank woes, French bond sale PARIS (AP) â¿¿ The specter of Europe's debt crisis returned Thursday as bank stocks fell sharply on worries about losses on government debt and a French bond auction dampened investor demand.
Financial stocks slumped as it became clear banks would have trouble raising billions in new capital in coming months. In Italy, trading in UniCredit shares was halted after they'd lost a quarter of their value since yesterday morning, when the bank announced it had to offer huge discounts to investors to attract new capital.
The banks need the money to cover potential losses on government debt, whose value has plummeted across most of Europe in recent months on fear of defaults. Now, many countries in the region have to roll over billions in debt in coming months, putting huge focus on their bond auctions. ___ Fewer people sought unemployment aid last week WASHINGTON (AP) â¿¿ The number of people seeking unemployment benefits fell further last week, ending the year on a three-month run of declines that point to stronger hiring in 2012. Weekly applications dropped by 15,000 to a seasonally adjusted 372,000 last week, the Labor Department said. That's 11 percent lower than the same time last year and a positive sign ahead of Friday's important read on December job growth. The four-week average, which smoothes fluctuations, fell to 373,250 â¿¿ the lowest level since June 2008. ___ US service firms grew at faster pace in December WASHINGTON (AP) â¿¿ U.S. service companies grew at a faster pace in December, helping the economy end 2011 on a stronger note. The Institute for Supply Management says its index of non-manufacturing activity rose to 52.6 in December, up from 52 in November. Any reading above 50 indicates expansion. The companies, which employ roughly 90 percent of the work force, reported seeing an increase in new orders. That suggests January could be even stronger for service companies. ___ Rate on 30-year mortgage back to record low 3.91 percent WASHINGTON (AP) â¿¿ 2012 looks to be another year of opportunity for the few who can afford to buy or refinance a home.The average rate on the 30-year fixed mortgage fell to 3.91 percent this week, Freddie Mac said Thursday. That matches the record low reached two weeks ago.
The average on the 15-year fixed mortgage ticked down to 3.23 percent from 3.24 percent. That's up from 3.21 percent two weeks, which also was a record low. ___ Constellation Brands' 3rd-quarter profit slumps ROCHESTER, N.Y. (AP) â¿¿ Constellation Brands Inc. said Thursday its third-quarter profit slumped 25 percent on weaker wine and beer sales in North America, price hikes that hurt sales of two popular wine brands and stepped-up promotional costs. The results narrowly missed Wall Street estimates. The company's shares fell 71 cents, or 3.5 percent, to close Thursday at $19.73. The world's No. 2 winemaker by volume said its revenue dropped 27 percent to $700.7 million from $966.4 million largely because it sold the bulk of its Australian and British wine business. ___ Eli Lilly 2012 profit forecast misses expectations INDIANAPOLIS (AP) â¿¿ Financial analysts expected Eli Lilly's 2012 earnings to slip after the drugmaker lost patent protection for a its top-selling product, but they didn't envision a decline as steep as the one Lilly forecast Thursday. The Indianapolis company said it will earn between $3.10 and $3.20 per share in its first full year after losing the U.S. patent that protects its antipsychotic Zyprexa from generic competition. Analysts on average had been expecting earnings of $3.60 per share, according to FactSet. Zyprexa rang up more than $5 billion in 2010 sales and $3.87 billion through the first nine months of 2011. The patent expired in October. Lilly expects revenue from Zyprexa, which has now lost patent protection in most markets outside Japan, to plunge by more than $3 billion in 2012. ___ Barnes & Noble falls on guidance cut, Nook reviewNEW YORK (AP) â¿¿ Barnes & Noble is considering options for its fast-growing but expensive electronic book business, its latest attempt to regain profitability as the publishing industry adapts to the rising popularity of digital books and magazines.
Investors fled as the company also forecast a much bigger loss for the year than originally expected. The book seller's stock lost nearly a fifth of its value on Thursday. Barnes & Noble has been investing heavily in e-books and its Nook readers as it faces tough competition from online retailers and discount stores. Those investments have led to losses for the New York-based company, even though the new business is growing as consumers shift to reading e-books. ___ Alcoa to close Tennessee smelter, make other cuts NEW YORK (AP) â¿¿ Alcoa Inc. plans to close an aluminum smelter in Tennessee and some operations at a Texas facility to cut costs in the face of weak prices. The moves will reduce Alcoa's global smelting capacity by about 12 percent. The company said Thursday that it will permanently close the smelter in Alcoa, Tenn., which was curtailed in 2009, and shut two of six idle lines at a smelter in Rockdale, Texas. It expects to complete the process in the first half of this year and announce other reductions soon. ___ By The Associated Press (equals) The Dow Jones industrial average fell 2.72 points to 12,415.70. The Standard & Poor's 500 index rose nearly 4 points to close at 1,281.06. The Nasdaq rose 21.5 points to 2,669.86. Benchmark crude fell by $1.41 to end the day at $101.81 per barrel in New York. Brent crude fell 96 cents to finish at $112.74 a barrel in London. In other energy trading, heating oil lost 5 cents to end the day at $3.04 per gallon and gasoline futures fell by 5 cents to finish at $2.74 a gallon. Natural gas finished down 12 cents, or 3.8 percent, at $2.98 per 1,000 cubic feet.
