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--Updates: WALL STREET



NEW YORK â¿¿ The fiscal cliff compromise, for all its chaos, controversy and unresolved questions, was enough to send the stock market shooting higher, the first trading day of the new year. The Dow Jones industrial average careened more than 300 points higher, its biggest gain since December 2011, just 5 percent below its record high close reached in October 2007. The Russell 2000, an index that tracks smaller companies, shot up to the highest close in its history. By Christina Rexrode.

AP photos


WASHINGTON â¿¿ While the tax package that Congress passed New Year's Day will protect 99 percent of Americans from an income tax increase, most of them will still end up paying more federal taxes in 2013. That's because the legislation did nothing to prevent a temporary reduction in the Social Security payroll tax from expiring. In 2012, that 2-percentage-point cut in the payroll tax was worth about $1,000 to a worker making $50,000 a year. By Stephen Ohlemacher.


â¿¿ FISCAL CLIFF-TAX IMPACT-GLANCE â¿¿ How tax increases will affect households at different income levels.

â¿¿ FISCAL CLIFF â¿¿ Congress approves a deal that averts a prolonged tumble off the fiscal cliff, but lays the groundwork for future battles between Republicans and Democrats over federal spending and debt.

â¿¿ FISCAL CLIFF-GLANCE â¿¿ Highlights of legislation aimed at averting wide tax increases and budget cuts scheduled to take effect with the new year.



NEW YORK â¿¿ The fiscal cliff deal in Congress has removed a layer of uncertainty for small business owners. Some say they're now able to hire staffers and buy equipment, moves that were on hold because of the debate in Washington. But owners still have much to be anxious about. The deal puts off for two months decisions on federal budget cuts, which could mean less business for companies that have contracts with the government. The ongoing budget fight in Washington could also further stress the weak economic recovery. By Joyce M. Rosenberg.

AP photo


PARSIPPANY, N.J. â¿¿ Avis Budget is buying Zipcar for $491 million, expanding its offerings to car sharing. The service has become a popular alternative to traditional car rentals in cities and on college campuses.

AP photo


PROVIDENCE, R.I. â¿¿ In Philadelphia, pension costs doubled in a single decade. Cities in Rhode Island dimmed streetlights, raised taxes and put off road repairs. Stockton, Calif., fell into bankruptcy. Unpaid bills from decades of retirement promises made to public workers, combined with a lackluster economy and steep Wall Street losses, have built up a financial mountain that threatens to undermine budgets and operations in cities and counties across the country. While it's not gotten the attention of the fiscal cliff in Washington, the pension crisis at City Hall could have similar effects as mayors are forced to raise taxes, cut government services or renege on pension promises made to police officers, firefighters, teachers and other public workers. By David Klepper.


â¿¿ BROKEN BUDGETS-MUNICIPAL PENSIONS-GLANCE â¿¿ From Atlanta to San Diego: The pension problems that threaten 7 cities' budgets



WASHINGTON â¿¿ U.S. manufacturing grew slowly last month after shrinking in November and hiring increased, a sign of modest economic momentum heading into the new year. The Institute for Supply Management says its index of manufacturing activity rose to 50.7 in December from 49.5 in the previous month. November's reading was the lowest reading since July 2009, one month after the recession ended. By Christopher S. Rugaber.


WASHINGTON â¿¿ U.S. builders spent less on construction projects in November, the first decline in eight months, as activity was held back by a big drop in spending on federal projects. The Commerce Department says construction spending dipped 0.3 percent in November compared with October, when spending had risen a revised 0.7 percent. It was the first drop since March. By Martin Crutsinger.


WASHINGTON â¿¿ Republicans and Democrats from New York and New Jersey lashed out at House Speaker John Boehner for pulling legislation on Hurricane Sandy aid, demanding that he reverse course and allow a vote as their constituents continue to struggle with the aftermath of the devastating storm. President Barack Obama called for an immediate House vote, and governors of the two states called House inaction a "dereliction of duty." By Andrew Miga And Larry Margasak.

AP photo

â¿¿ SMALLBIZ-SMALL BUSINESS LENDING â¿¿ The erratic pace of borrowing by small businesses owners continued in November â¿¿ a sign that they were still cautious about hiring.

â¿¿ OIL PRICES â¿¿ The price of oil rose as traders cheered a deal in Washington to avert the "fiscal cliff." Benchmark crude for February delivery rose $1.30 to finish the first trading day of the year at $93.12 a barrel on the New York Mercantile Exchange.


ST. LOUIS â¿¿ Winter storms have dropped more than 15 inches of snow on parts of the Midwest and East in recent weeks. But climatologists say it would take at least 8 feet of snow â¿¿ and likely far more â¿¿ to return the soil to its pre-drought condition in time to ease the woes of farmers and ranchers. By Jim Suhr.

AP photos.



DETROIT â¿¿ An auto industry research firm says an improving economy and a host of new models should push U.S. auto sales above 15 million this year. That's 7 percent higher than the Polk firm's prediction of 14.5 million sales for 2012 â¿¿ itself the strongest year since 2007.


â¿¿ ITALY-FIATâ¿¿ Fiat says 2012 was the worst year for car sales in Italy since 1979, but that the manufacturer nevertheless managed to slightly increase its share of the national market.

â¿¿ WENDY'S-VALUE MENUâ¿¿ Wendy's no longer thinks a hamburger has to be 99 cents to be a deal. The fast-food company has replaced its 99-cent value menu with a beefed up array of options called "Right Price Right Size," with items ranging from 99 cents to $1.99 as costs for meat, cheese and other ingredients rise.

â¿¿ MIDAMERICAN-SOLARâ¿¿ Berkshire Hathaway's utility MidAmerican Energy is buying two solar power projects under construction in Southern California from SunPower Corp. that will generate 579 megawatts of electricity.

â¿¿ CANADA-ARCELOR-POSCO-CHINA STEEL DEAL â¿¿ Global steel giant ArcelorMittal will sell a 15 percent stake in one of its Canadian iron ore operations to an Asian-led consortium for $1.1 billion.

â¿¿ SHELL-ARCTIC DRILL SHIP â¿¿ High seas and strong winds are preventing crews from boarding an oil drilling ship to check for any damage after the large vessel went aground off an uninhabited island in the Gulf of Alaska.

â¿¿ YELLOWSTONE OIL SPILL â¿¿ Federal investigators say Exxon Mobil Corp.'s delayed response to a pipeline break beneath Montana's Yellowstone River made the spill far worse than it otherwise would have been.



SAN FRANCISCO â¿¿ Microsoft is making a last-ditch effort to convince government regulators that they need to crack down on Google to preserve competition on the Internet and in smartphone markets.


LOS ANGELES â¿¿ Nintendo's Wii U game console gives you a new way to watch TV. A new feature called TVii lets you search for shows over Internet video apps and live TV all in one place, and it lets you chat about them on social media. TVii beats my set-top box remote control hands down, but it takes some getting used to. But once I did, I found the service is an advance from the mass of buttons on most TV remote controls. By Ryan Nakashima.

â¿¿ SKOREA-LG-OLED TV â¿¿ LG beats rivals in race to sell new OLED TVs as it starts taking pre-orders. It's the first big TV with an advanced display technology promising startlingly clear images on a wafer-thin screen.

â¿¿ CHINA-BOX OFFICE â¿¿ A low-budget, domestically produced comedy â¿¿ the wacky road movie "Lost in Thailand" â¿¿ has unexpectedly become the highest-grossing Chinese film to date, making about $160 million since its Dec. 12 debut.


â¿¿ PHILIPPINES-SYRIAâ¿¿ A Philippine container port operator has decided to pull out of Syria and withdrew all its Filipino workers from a key port due to increasing dangers from the country's civil war.

â¿¿ MACAU-GAMBLING REVENUE â¿¿ Casino revenue in Macau climbed 13.5 percent last year to a record $38 billion. But growth in the world's biggest gambling market slowed in 2012 from the year before, when it shot up 42 percent.

â¿¿ PORTUGAL-FINANCIAL CRISIS â¿¿ Portugal's president asks highest court to rule on the legality of the latest austerity budget.


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Dividends in 2013

The deal Congress passed to avoid the "fiscal cliff" means that the dividend tax rate will remain the same for the majority of taxpayers. But individuals with income above $400,000 will pay 20 percent, an increase from 15 percent. The increase was much less than feared. How might this outcome impact dividend payments in the year ahead?


Avis buying Zipcar

Shares of Zipcar soared on Wednesday following news that Avis Budget Group is buying Zipcar for $491.2 million.

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