US economy grew at 2.5 per cent rate in spring
WASHINGTON (AP) — The U.S. economy grew at a 2.5 per cent annual rate from April through June, much faster than previously estimated. The steep revision was largely because U.S. companies exported more goods and imports declined.
The Commerce Department said second-quarter growth was sharply higher than the initial 1.7 per cent rate it reported last month. And the growth this spring was more than double the 1.1 per cent rate from January through March.
The improvement in the trade deficit helped offset a weaker government spending.
Economists expect growth will stay at an annual rate of around 2.5 per cent in the second half of the year, helped by steady job gains and less drag from federal spending cuts. Still, some say higher interest rates might restrain the economy’s expansion in the second half.
Applications for US unemployment aid fall to 331K
WASHINGTON (AP) — The number of Americans seeking unemployment benefits remained near the lowest level in more than five years last week, a sign that companies are cutting few jobs.
First-time applications for benefits fell 6,000 to a seasonally adjusted 331,000, the Labor Department said Thursday. The four week average, a less volatile measure, inched up 750 to 331,250 after falling to its lowest level since November 2007 the previous week.
Applications for unemployment benefits reflect layoffs. At the depths of the recession in March 2009, they numbered 670,000. The average has fallen 10 per cent this year.
All told, nearly 4.5 million people received unemployment benefits in the week that ended Aug. 10, the latest period for which figures are available. That’s about 30,000 more than in the previous week.
Fast-food workers stage largest protests yet
NEW YORK (AP) — Thousands of fast-food workers and their supporters beat drums, blew whistles and chanted slogans Thursday on picket lines in dozens of U.S. cities, marking the largest protest yet in their quest for higher wages.
The nationwide day of demonstrations came after similar actions organized by unions and community groups over the past several months. Workers are calling for the right to unionize without interference from employers and for pay of $15 an hour. That’s more than double the federal minimum wage of $7.25 an hour, or $15,000 a year for full-time employees.
Thursday’s walkouts and protests reached about 60 cities, including New York, Chicago and Detroit, organizers said. But the turnout varied significantly, with some targeted restaurants seemingly operating normally and others temporarily unable to do business because they had too few employees.
US banks earn record $42.2 billion in 2nd quarter
WASHINGTON (AP) — U.S. banks earned more from April through June than during any quarter on record, aided by a steep drop in losses from bad loans.
The Federal Deposit Insurance Corp. says the banking industry earned $42.2 billion in the second quarter, up 23 per cent from the second quarter of 2012. About 54 per cent of U.S. banks reported improved earnings from a year earlier.
Banks’ losses on loans tumbled 30.7 per cent from a year earlier to $14.2 billion, the lowest in six years. And bank lending increased 1 per cent from the first quarter. Greater lending helps boost consumer and business spending, leading to more jobs and faster economic growth.
Still, the report shows that the largest banks continue to drive the industry’s profits while smaller institutions have struggled. Banks with assets exceeding $10 billion make up only 1.5 per cent of U.S. banks. Yet they accounted for about 82 per cent of the industry’s earnings in the April-June quarter.
Nasdaq takes some blame for 3-hour breakdown
NEW YORK (AP) — A three-hour trading outage on the Nasdaq last week was partly the result of issues within the company’s control, the Nasdaq OMX Group said Thursday.
In a statement, the company detailed some of its early findings from an internal review. The Nasdaq blamed “a confluence of unprecedented events” that overwhelmed the exchange’s system for handling price information. It said the catalyst was a torrent of messages from a trading platform run by the New York Stock Exchange, Arca.
J&J launches new cap to curb Tylenol overdoses
WASHINGTON (AP) — Bottles of Tylenol sold in the U.S. will soon bear red warnings alerting users to the potentially fatal risks of taking too much of the popular pain reliever. The unusual step, disclosed by the company that makes Tylenol, comes amid a growing number of lawsuits and pressure from the federal government that could have widespread ramifications for a medicine taken by millions of people every day.
Johnson & Johnson says the warning will appear on the cap of new bottles of Extra Strength Tylenol sold in the U.S. starting in October and on most other Tylenol bottles in coming months. The warning will make it explicitly clear that the over-the-counter drug contains acetaminophen, a pain-relieving ingredient that’s the nation’s leading cause of sudden liver failure.
Vodafone in talks to sell Verizon Wireless stake
LONDON (AP) — Britain’s Vodafone PLC, one of the world’s largest cellphone companies, confirmed Thursday that it was talking to Verizon Communications about selling its stake in Verizon Wireless, the No. 1 mobile carrier in the U.S.
The U.K. company is mulling its options for its 45 per cent stake in Verizon Wireless. Verizon Communications owns the other 55 per cent.
Analysts have suggested that Verizon wants to pay around $100 billion for Vodafone’s stake, although reports have said that U.K. group is pressing for as much as $130 billion.
Zurich chairman quits after finance chief’s death
GENEVA (AP) — The chairman of the Zurich Insurance Group abruptly resigned Thursday over the apparent suicide of its chief financial officer, claiming he wants to avoid damaging the company’s reputation.
Josef Ackermann, who is Swiss and a former CEO of Deutsche Bank, Germany’s largest, said in a company statement that he was resigning because he believed the undisclosed accusations levelled against him by the family of deceased CFO Pierre Wauthier could hurt Zurich’s top ranks.
A day after Wauthier’s death, Swiss police said Tuesday that he appeared to have taken his own life. He was found dead in his home in the wealthy lakefront community of Zug, just outside Zurich. Ackermann said the family believes he bears some responsibility for the death.
By The Associated Press=
The Dow Jones industrial average rose 16.44 points, or 0.1 per cent, to close at 14,840.95 Thursday. The Standard & Poor’s 500 index rose 3.21 points, or 0.2 per cent, to 1,638.17. The Nasdaq composite rose 26.95 points, or 0.8 per cent, to 3,620.30.
Benchmark oil for October delivery fell $1.30, or 1.2 per cent, to $108.80 a barrel on the New York Mercantile Exchange Thursday. Heating oil lost 2.3 cents to $3.19 per gallon. Natural gas rose 3.6 cents to $3.62 per 1,000 cubic feet. Wholesale gasoline fell 3.10 cents to $2.93 per gallon.
Brent crude, the benchmark for international crudes, fell $1.06 cents to $115.38 a barrel on the ICE Futures exchange in London.