By The Associated PressNEW YORK (AP) â¿¿ ___ Wal-Mart's weak forecast show how poor and middle-class is being squeezed NEW YORK (AP) â¿¿ As go the fortunes of many Americans, so goes Wal-Mart's, and so goes the economy. Even as the world's largest retailer on Thursday reported a nearly 9 percent rise in fourth-quarter profit during the busy holiday shopping season, it offered a weaker forecast for the coming months. The problem? The poor and middle-class Americans that Wal-Mart caters to â¿¿ and who are big drivers of spending in the U.S. â¿¿ are struggling with rising gas prices, delayed income tax refunds and higher payroll taxes. Wal-Mart is the latest in a string of big-name companies from Burger King to Zale to say those Americans are being squeezed by new challenges. But since Wal-Mart accounts for nearly 10 percent of nonautomotive retail spending in the U.S., it is a bellwether for the economy. "Wal-Mart moms are the barometer of the U.S. household," said Brian Sozzi, chief equities analyst at NBG Productions who follows Wal-Mart. "Right now, they're afraid of higher taxes and inflation." ___ Oil prices down sharply for a 2nd day NEW YORK (AP) â¿¿ Oil prices plunged for a second day Thursday, raising hopes that a relentless rise in gasoline prices may slow or reverse at least temporarily. U.S. benchmark crude oil fell $2.38, or 2.5 percent, to finish at $92.84 per barrel in New York, the second drop of 2 percent in two days. Crude oil's recent slide is a result of ample supplies and recent speculation that the Federal Reserve may soon allow interest rates to rise, which would reduce the supply of easy cash investors have been using to buy commodities like oil. The drop in crude hasn't translated into lower pump prices â¿¿ yet. The average U.S. retail gasoline price rose a penny to $3.78 per gallon Thursday, according to AAA, the Oil Price Information Service, and Wright Express. Gasoline has risen for 34 days straight since averaging $3.29 on Jan. 18.
The two day plunge in crude and slightly lower wholesale gasoline futures prices are expected to at least slow the rise in pump prices, and perhaps push them back slightly.___ Private US firms take major role vs. cyberattacks WASHINGTON (AP) â¿¿ When Kevin Mandia, a retired military cybercrime investigator, decided to expose China as a primary threat to U.S. computer networks, he didn't have to consult with American diplomats in Beijing or declassify tactics to safely reveal government secrets. He pulled together a 76-page report based on seven years of his company's work and produced the most detailed public account yet of how, he says, the Chinese government has been rummaging through the networks of major U.S. companies. It wasn't news to Mandia's commercial competitors, or the federal government, that systematic attacks could be traced back to a nondescript office building outside Shanghai that he believes was run by the Chinese army. What was remarkable was that the extraordinary details â¿¿ code names of hackers, one's affection for Harry Potter and how they stole sensitive trade secrets and passwords â¿¿ came from a private security company without the official backing of the U.S. military or intelligence agencies that are responsible for protecting the nation from a cyberattack. The report also shows the balance of power in America's cyberwar has shifted into the hands of the $30 billion-a-year computer security industry. ___ Italian traditions provide buffers to the crisis VICENZA, Italy (AP) â¿¿ Self-made Italians like Amedeo Tartarini never expected to need help. Tartarini's goldsmith business thrived for decades in Italy's postwar boom. He was one of legions of small businessmen who made Italy an industrial power. With a house, money in the bank and a teeming workshop, the affable artisan never questioned his financial security â¿¿ until it was too late.
In many rich countries, a person like Tartarini, who has lost his home, his business and his life's savings, might have ended up on the street. Instead, he has managed to keep afloat thanks to friends and community spirit. Italy's extraordinary social safety nets, rooted in centuries of tradition, have helped soften the blow for millions of Italians â¿¿ and, so far at least, insulated the nation from the scenes of explosive unrest that have unfolded in other crisis-hit southern European countries. Italy heads into general elections this weekend that promise to determine what shape these crisis buffers will take in the future.___ Claims for US jobless aid suggest modest hiring WASHINGTON (AP) â¿¿ The number of Americans seeking unemployment benefits jumped 20,000 last week to a seasonally adjusted 362,000, though it remains at a level that suggests slow but steady improvement in the job market. The Labor Department said Thursday that the four-week average, a less volatile measure, rose 8,000 to 360,750, the highest in six weeks. A department spokesman said heavy snowstorms in the Northeast didn't affect the total. Applications for unemployment benefits are a proxy for layoffs. Even with last week's jump, they have trended downward recently. The four-week average has declined 7.5 percent since mid-November and fell to a five-year low three weeks ago. Last week's increase puts applications for unemployment benefits back in the 360,000-to-390,000 range, where they have fluctuated since early last year. Since then, employers have added an average of 181,000 jobs a month. ___ US home sales rise to 2nd-highest pace in 3 years WASHINGTON (AP) â¿¿ U.S. sales of previously occupied homes rose in January to the second-highest level in three years, a sign that the housing market is sustaining its recovery and helping bolster the economy. The National Association of Realtors said Thursday that sales rose 0.4 percent in January compared with December to a seasonally adjusted annual rate of 4.92 million. That was the second-highest sales pace since November 2009, when a temporary home buyer tax credit had boosted sales.
The median price for a home sold in January was $173,600, a 12.3 percent increase from a year ago. Analysts say purchases would be higher if more homes were available. The supply of homes for sale dropped to nearly an eight-year low in January.___ US consumer prices flat in January for 2nd month WASHINGTON (AP) â¿¿ U.S. consumer prices were flat in January from December for the second month in a row; the latest sign inflation is in check. That could give the Federal Reserve leeway to continue its efforts to stimulate growth. The consumer price index has risen 1.6 percent in the 12 months ending in January, the Labor Department said Thursday. That's down from a 2.9 percent pace a year ago. Excluding the volatile food and energy categories, core prices rose 0.3 percent in January. Core prices have risen 1.9 percent in the past year, below the Fed's inflation target. That's also down from the 2.3 percent pace in the same month a year ago. The Fed is purchasing $85 billion in Treasurys and mortgage bonds each month in an effort to keep interest rates low. Last month, some Fed policymakers expressed concern the purchases could eventually cause inflation or disrupt bond markets, according to minutes of the Fed's Jan. 29-30 meeting released Wednesday. But most private economists see little sign that prices are increasing at a troubling rate. ___ US rate on 30-year mortgage rises to 3.56 pct. WASHINGTON (AP) â¿¿ The average U.S. rate on the 30-year fixed mortgage rose this week but remained near historic lows. Low mortgage rates have helped support the slowly recovering housing market. Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan increased to 3.56 percent from 3.53 percent last week. That's still near the 3.31 percent reached in November, which was the lowest on record dating to 1971.
The average rate on the 15-year fixed mortgage stayed at 2.77 percent for a third straight week. The record low is 2.63 percent.The cheap mortgages that are encouraging more people to buy or refinance could also help sustain the economy's recovery this year. Increased sales are helping lift home prices, which tend to make consumers feel wealthier and more likely to spend. And when homeowners refinance, it typically leads to lower loan payments and more spending. Consumer spending drives nearly 70 percent of economic activity. ___ Feds indict 4 in peanut butter salmonella outbreak WASHINGTON (AP) â¿¿ Four former peanut company employees have been charged with scheming to manufacture and ship salmonella-tainted peanuts that killed nine, sickened hundreds and prompted one of the largest recalls in history. The indictment by a federal grand jury in Georgia is a rare move by the federal government in food poisoning cases. Justice Department officials said Thursday that the charges stemming from the 2009 outbreak serve as a warning to food manufacturers who may compromise consumer safety in search of higher profits. "When food or drug manufacturers lie and cut corners, they put all of us at risk," Stuart F. Delery, who heads the Justice Department's Civil Division, said at a news conference. "The Department of Justice will not hesitate to pursue any person whose criminal conduct risks the safety of Americans who have done nothing more than eat a peanut butter and jelly sandwich." ___ HP's 1Q offers glimmer of hope, stock surges Hewlett-Packard Co.'s latest quarterly results provided a glimmer of hope after months of gloomy news. The fiscal first-quarter numbers announced Thursday topped what the slumping personal computer maker's own management and stock market analysts had forecast. Like other PC makers, HP has been struggling to adapt to a shift toward smartphones and tablet computers, which are siphoning sales from desktop and laptop machines made by HP and other companies. Adding to the problems were some acquisitions gone awry. Over the past two quarters, HP announced losses totaling $15.3 billion as the company accounted for those mishaps, to the shock of Wall Street. The jolt caused HP's stock to plunge to its lowest price in a decade just three months ago.
The same problems are still plaguing HP, but signs of progress in the latest quarter indicated that the company's turnaround efforts are running ahead of schedule. CEO Meg Whitman has consistently said it may be several years before HP is on solid ground again.___ Nordstrom 4th-quarter net income rises SEATTLE (AP) â¿¿ Nordstrom said Thursday its fourth-quarter net income rose 20 percent as high-end shoppers kept spending on clothing and makeup, and customers responded positively to its service improvements. But annual guidance disappointed investors and Nordstrom's shares fell 2 percent in aftermarket trading. Luxury spending has stayed strong despite the uncertain economy. Nordstrom has also improved customer service with free shipping offers and checkouts via mobile devices anywhere in the store. Top performing categories included men's, women's and kids clothing as well as makeup. Online sales were a strong point, up 31 percent and surpassing $1 billion for the first time. ___ By The Associated Press(equals) The Dow Jones industrial average closed down 46.92 points, or 0.3 percent, at 13,880.62. The S&P 500 index dropped 9.53, or 0.6 percent, to 1,502.42. The S&P is headed for its first weekly loss of the year. The Nasdaq composite index lost 32.92, or 1 percent, to 3,131.49. U.S. benchmark crude oil fell $2.38, or 2.5 percent, to finish at $92.84 per barrel in New York, the second drop of 2 percent in two days. Brent crude, which is used to price oil used to make gasoline in many U.S. refineries, fell $2.07 to end at $113.53. Natural gas fell 3 cents to finish at $3.25 per thousand cubic feet. Heating oil fell 6 cents to end at $3.10 per gallon. Wholesale gasoline for April dropped by 2 cents to finish at $3.24 per gallon.