The Associated Press___ Rising gas prices crimp Americans' spending WASHINGTON (AP) â¿¿ Higher gas prices are crimping consumer spending and slowing the already-weak U.S. economy. And they could get worse in the coming months. The Federal Reserve this week took steps to boost economic growth. But those stimulus measures are also pushing oil prices up. If gas prices follow, consumers will have less money to spend elsewhere. Americans are already feeling pinched by high unemployment, slow wage growth and higher gas prices. Consumers increased their spending at retail businesses by 0.9 percent in August, the Commerce Department reported Friday. But that was largely because they paid more for gas. Excluding the impact of gas prices and a sizeable increase in auto sales, retail sales rose just 0.1 percent. ___ Dow average dumps Kraft Foods for UnitedHealth NEW YORK (AP) â¿¿ The Dow Jones industrial average is dumping Cool Whip for copays. The Dow, perhaps the most widely known barometer of the U.S. stock market, announced Friday that it would boot Kraft Foods to make room for UnitedHealth Group, the insurance company. The change takes effect Sept. 24. S&P Dow Jones Indices, which manages the average, said it was dropping Kraft because it is about to become a much smaller company after spinning off its North American grocery business. ___ Egan-Jones cuts US debt rating to AA- from AA NEW YORK (AP) â¿¿ Egan-Jones, an independent credit-research firm, downgraded its rating on U.S. government debt to AA- from AA on Friday, citing the Federal Reserve's plans to try to stimulate the economy. The credit rating agency said the Fed's plans to buy mortgage bonds will likely hurt the economy more than help it. The plan will weaken the value of the dollar and push up prices for oil and other commodities, Egan-Jones said. That would leave less for consumers to spend on other things.
But at the same time, Egan-Jones warned that the federal government's borrowing costs are likely to slowly rise as the global economy recovers.___ Buying American in Tehran: Apples, razors and Coke TEHRAN, Iran (AP) â¿¿ The Great Satan still sells in Iran. Even after decades of diplomatic estrangement and tightening economic sanctions, American products manage to find their way into the Iranian marketplace. The routes are varied: back channel exporters, licensing workarounds and straightforward trade for goods not covered by the U.S. embargoes over Iran's nuclear program. It offers lessons in the immense difficulties facing Western attempts to isolate Iran's economy, which has deepening trade links with Asia where distributors serve as middlemen to funnel U.S. and other goods to Iranian merchants. But sanctions are also battering Iran's currency and driving up costs for all imports, which could increase domestic pressures on Iran's ruling system. Although the number of Made-in-America items in Iran is dwarfed by the exports from Europe, China and neighboring Turkey, some of the best-known U.S. brands can be tracked down in Tehran and other large cities. It's possible to check your emails on an iPhone, sip a Coke and hit the gym in a pair of Nikes. ___ India agrees to let in foreign retailers, again NEW DELHI (AP) â¿¿ India agreed Friday to open its huge market to foreign retailers such as Wal-Mart in a surprising decision that was part of a flurry of economic reforms aimed at sparking new growth in the country's sputtering economy. The Cabinet's decision â¿¿ after a similar proposal was withdrawn under withering criticism last year â¿¿ immediately generated optimism that a government plagued by scandal was finally breaking out of the political paralysis that had stifled reforms for months. ___ NYSE paying $5 million fine to settle charges on data
WASHINGTON (AP) â¿¿ The New York Stock Exchange is paying $5 million to settle federal civil charges that it gave some customers an unfair head start by providing them with trading data ahead of the wider public.It marked the first time the Securities and Exchange Commission ever imposed a fine on an exchange. The NYSE and its parent NYSE Euronext also agreed in the settlement to hire an independent consultant to review their systems for delivering market data. They neither admitted nor denied the SEC's allegations. ___ SEC ends one investigation into Avon Products NEW YORK (AP) â¿¿ Avon Products Inc.'s legal woes may finally be on the wane. The direct-beauty product seller said in a regulatory filing late Thursday that the Securities and Exchange Commission has decided it won't recommend any action against the company over whether Avon contacted analysts inappropriately during a separate bribery investigation. The end of the investigation into analyst contacts is a plus for the company which is trying to turn around its financial performance as new CEO Sheri McCoy settles into the job. ___ House votes to end energy loan guarantee program WASHINGTON (AP) â¿¿ Republicans on Friday pushed a bill through the House shining a campaign-season light on the most conspicuous failure of President Barack Obama's economic stimulus package. The bill would phase out federal loan guarantees like those that went to the now-bankrupt solar power company Solyndra LLC and left taxpayers on the hook for more than $500 million. The "No More Solyndras Act," which passed on a mainly party-line vote, has no chance of advancing in the Democratic-led Senate and was assailed by House Democrats as an election-year stunt. The vote was 245-161. The bill would curtail an Energy Department loan guarantee program that was the source of the more than $500 million investment in Solyndra. It was part of the $787 billion stimulus package enacted shortly after Obama took office in 2009.
___US industrial production fell 1.2 percent WASHINGTON (AP) â¿¿ U.S. industrial production fell in August by the largest amount in more than three years as factories produced fewer cars and other manufactured goods and Hurricane Isaac triggered shutdowns along the Gulf Coast. Industrial production dropped 1.2 percent last month compared to July, the Federal Reserve said Friday. It was the biggest setback since a 1.7 percent decline in March 2009 when the country was in recession. Manufacturing output, the most important component of industrial production, fell 0.7 percent, led by a 4 percent drop in output at auto plants. ___ US business stockpiles grew 0.8 percent in July WASHINGTON (AP) â¿¿ U.S. companies restocked their shelves in July at the fastest pace since January while their sales increased. The combination could boost economic growth. The Commerce Department said Friday that business inventories grew 0.8 percent in July, up from June's 0.1 percent gain. Sales jumped 0.9 percent, the most this year, after a steep fall in June. The biggest growth in stockpiles was among retailers and auto dealers. Stockpiles at manufacturers and wholesalers rose more slowly. ___ By The Associated Press(equals) The Dow Jones industrial average rose 53.51 points to 13,593.37. The Standard & Poor's 500 rose 5.78 to 1,465.77. The Nasdaq composite index climbed 28.12 to 3,183.95. Benchmark oil finished up 69 cents to $99 per barrel in New York. Brent crude, which is used to price a number of international types of oil, rose 78 cents to $116.66 in London. Wholesale gasoline rose 5.34 cents to $3.0156 per gallon. Natural gas dropped 9.4 cents to $2.943 per 1,000 cubic feet. Heating oil gained 2.82 cents to $3.2395 per gallon.