Friday's Business Highlights
Friday, November 1, 2013
Here are business news highlights for Friday, Nov. 1, 2013.
Shutdown slows — but doesn’t halt — US car demand
DETROIT (AP) — The government shutdown dampened — but didn’t stall — Americans’ demand for new cars and trucks.
The 16-day shutdown slowed U.S. auto sales in the first two weeks of October, but they picked up speed in the last two weeks. Sales rose 11 percent to 1.2 million.
General Motors, Ford, Nissan and Chrysler all recorded double-digit sales gains, while Toyota, Honda and Hyundai saw smaller increases. Of major automakers, only Volkswagen’s sales fell.
Compact crossover SUV sales booming in US
DETROIT (AP) — Aging baby boomers. Couples with small kids. Single people with dogs.
All three groups love compact crossover SUVs, utility vehicles built mainly on small-car frames that are among the hottest-selling vehicles in the U.S.
So far this year, sales of the versatile, high-sitting hatchbacks such as the Honda CR-V, Ford Escape and Toyota RAV4 are up more than 20 percent.
From 2000 through last year, annual U.S. sales of small crossovers quadrupled, from just over 405,000 to well above 1.6 million, according to LMC Automotive, an industry data and research firm. Only their larger cousins, midsize crossovers such as the Toyota Highlander and Ford Edge, grew faster. This year, sales of small crossovers have already passed last year’s record total of 1,656,497.
New quality complaints about Lululemon pants
NEW YORK (AP) — Just a few months after Lululemon Athletica pulled yoga pants from shelves because they were too sheer, costing the company millions in sales, it’s fielding new complaints about quality.
The Canadian company had blamed the problems from spring on a style change and production issues.
New yoga pants have since made their way into stores, but there are recent complaints on the Lululemon Facebook page and its website about pants that are still too sheer. There are also complaints about pants pilling after a few months of wear — or even just a few uses — and about holes and seams coming apart.
Falling inflation another headache for European Central Bank
FRANKFURT, Germany (AP) — On top of high unemployment and sluggish growth, the European Central Bank has a new headache: an unexpected drop in inflation.
Most people think lower inflation is good news because it makes things easier to buy — and usually it is. But the current slide is just another sign of how weak the economic recovery is in the 17 countries that use the euro.
An official report this week showed a surprise drop in the inflation rate to 0.7 percent in September from 1.1 percent the month before. That’s well below the ECB’s stated goal of close to but below 2 percent that it considers ideal for the economy.
Fliers delayed after Los Angeles airport shooting
Thousands of fliers across the U.S. were delayed Friday after a morning shooting at Los Angeles International Airport closed parts of the airport. The prolonged shutdown at the nation’s third largest airport was particularly troublesome for those hoping to head to the East Coast or across the Pacific Ocean.
Flights bound for Los Angeles that had not yet taken off were held at their gates for hours by the Federal Aviation Administration. There were more than 100 cancellations.
US manufacturing expands at best pace in 2 1/2 years
WASHINGTON (AP) — U.S. factory activity expanded in October at the fastest pace in 2 1/2 years, suggesting that the 16-day partial shutdown of the government had little effect on manufacturers.
Instead, overseas demand and healthy U.S. auto sales appear to be supporting factory output. The housing recovery is also lifting the furniture and wood products industry despite a recent slowing in home sales.
The ISM’s manufacturing index rose to 56.4 from 56.2 in September. A reading above 50 indicates growth.
Chevron profit falls on refining weakness
NEW YORK (AP) — Chevron said Friday that net income fell 6 percent in the third quarter as weak refining results and higher operating costs offset higher oil and gas production and prices.
The nation’s second-biggest oil company posted net income of $4.95 billion for the quarter on revenue of $56.6 billion. The company earned $5.25 billion on revenue of $55.66 billion in the same quarter last year.
The latest earnings amounted to $2.57 per share. Analysts had expected earnings of $2.69 per share, on average, according to FactSet.
Berkshire Hathaway’s profit jumps 29 percent
OMAHA, Neb. (AP) — Warren Buffett’s company reported a 29 percent jump in third-quarter profit as it collected some of the proceeds from deals made during the financial crisis.
Berkshire Hathaway earned $5.05 billion, or $3,074 per Class A share, during the quarter. That’s up from $3.92 billion, or $2,373 per Class A share, in the same period last year.
The biggest factor in the results was a $1.2 billion investment gain Berkshire recorded as it prepared to redeem warrants in General Electric and Goldman Sachs. Mars and Wrigley also repaid Berkshire for a crisis-era investment.
Wal-Mart kicks off holiday shopping season online
NEW YORK (AP) — Wal-Mart Stores Inc. is upping the ante on holiday shopping.
The world’s largest retailer is pulling forward by nearly a month seven big deals on items like TVs and tablets that were originally reserved for the day after Thanksgiving and so-called Cyber Monday.
Shoppers will be able to purchase the items online starting shortly after midnight Friday. At the same time, Walmart.com will be pushing another 300 holiday deals on its website, from toys to home decor.
Container Store doubles in NYSE trading debut
NEW YORK (AP) — Shares of The Container Store more than doubled in their market debut on Friday.
The retailer, which specializes in shelving, storage bins, boxes and related organizational items, priced its initial public offering of 12.5 million shares at $18 apiece. This was above the projected price range of $14 to $16 per share.
Shares jumped immediately and sustained the gains, ending the session up $18.20 at $36.20 on the New York Stock Exchange. Trading activity was heavy, with nearly 14.7 million shares changing hands.
The Dow Jones industrial average rose 69.80 points, or 0.5 percent, to 15,615.55. The Standard & Poor’s 500 index rose 5.10 points, or 0.3 percent, to 1,761.64. The Nasdaq composite rose 2.34 points, or 0.1 percent, to 3,922.04.
Benchmark U.S. crude for December delivery dropped $1.77 to close at $94.61 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international crude also used by U.S. refineries, fell $2.93 to $105.91 a barrel on the ICE exchange in London.
Wholesale gasoline slipped 4 cents to $2.55 a gallon. Heating oil shed 7 cents to $2.88 a gallon. Natural gas dropped 7 cents to $3.51 per 1,000 cubic feet.
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