Fed survey shows economy ended 2011 with strength
WASHINGTON (AP) — The final weeks of 2011 were the economy's best since it seemed to be slipping toward recession in late spring — a shot of optimism for 2012.
Consumers spent more freely. Factories made more goods. Americans stepped up travel. And the auto industry enjoyed its best stretch of the year.
That's the bright picture the Federal Reserve sketched in a survey released Wednesday. It said all but one of its 12 banking districts experienced some growth from late November through the end of the year.
FDA: J&J delayed reporting insulin pump problems
TRENTON, N.J. (AP) — Federal regulators have warned Johnson & Johnson that it could face fines and other sanctions for selling faulty insulin pumps and delaying disclosures of serious injuries to diabetics who were using its OneTouch Ping and 2020 pumps.
The Food and Drug Administration ordered J&J's Animas Corp. unit to explain why it kept selling pumps known to fail. The agency also ordered J&J to submit a plan for rectifying its failure to promptly report cases where its device might have caused or contributed to death or serious injury.
In a Dec. 27 warning letter posted online by FDA Tuesday, the agency wrote to Animas and J&J CEO Bill Weldon that inspectors found Animas, which is based in West Chester, Pa., never reported one complaint about serious patient injury and delayed reporting two others. Those patients were hospitalized with dangerously high blood sugar, respiratory failure and coma, and a life-threatening complication called diabetic ketoacidosis caused by lack of insulin to break down blood sugar.
Twinkies maker Hostess seeks bankruptcy protection
NEW YORK (AP) — Hostess Brands Inc., the maker of Twinkies and Wonder Bread, is seeking bankruptcy protection, blaming its pension and medical benefits obligations, increased competition and tough economic conditions.
The Chapter 11 filing on Wednesday comes just two years after a predecessor company emerged from bankruptcy proceedings.
That company, called Interstate Bakeries and based in Kansas City, Mo., filed for bankruptcy protection in 2004. It emerged in February 2009.
But Hostess said Wednesday that its previous efforts to produce incremental change, including the prior Chapter 11 case, were insufficient.
Brown winter means more green for many US cities
ST. PAUL, Minn. (AP) — The warm, brown winter that has disappointed snow lovers in much of the U.S. has put more green in the pockets of state and local governments that had their budgets busted last year by the high cost of keeping streets and highways clear.
Cities that normally spend millions on salt, sand and snowplows are happily saving the money for other purposes. Some are even taking advantage of the mild weather to carry on with outdoor projects that would usually have to wait until spring.
In Minnesota and North Dakota, crews have parked their snowplows and are patching roads and highways instead. Chicago spent just $500,000 on plowing in December, down from $6 million a year earlier. In Buffalo, N.Y., public works overtime is down by 25 percent, and the city has saved more than $300,000 on salt.
Natural gas falls to lowest price in a decade
NEW YORK (AP) — Natural gas is cheaper this winter than it's been in a decade.
Prices have dropped by more than 10 percent in the past week, including a plunge of almost 6 percent on Wednesday, as mild temperatures cut into heating demand and a production boom pumps up supplies.
Homeowners should eventually benefit from lower heating and electric bills.
Natural gas demand usually soars in the winter as homeowners and businesses crank up the heat. But in many parts of the U.S., thermostats haven't been turned up as much this year.
OJ futures plummet; investors await test results
Orange juice futures reversed course and fell 9.5 percent Wednesday pending more details about government testing for a fungicide that has been found in low levels in orange juice.
Orange juice futures for March delivery fell 19.65 cents to finish at $1.881 per pound, a day after the price spiked 11 percent on news of the Food and Drug Administration testing program. The price is still 14 percent higher than its recent low of $1.65 per pound on Dec. 21.
Analysts said Tuesday's jump may have been an overreaction to the news about the fungicide and that investors are questioning how much the testing program may affect supplies.
Raymond James buying Morgan Keegan in $1.8 billion deal
BIRMINGHAM, Ala. (AP) — Regions Financial Corp. says it has agreed to sell Morgan Keegan & Co. Inc. to Raymond James Financial Inc. for $930 million.
Morgan Keegan, one of the nation's leading underwriters of municipal bonds, will pay Regions a dividend of $250 million before closing, resulting in total proceeds to Regions of $1.18 billion.
The deal is expected to close in the first quarter.
Bumpy earnings season ahead for banks
NEW YORK (AP) — You can usually tell a lot about the health of the U.S. economy by looking at the financial results of banks. They're the people who finance new factories, plant expansions and fatter payrolls.
But don't count on that over the next two weeks, when banks report their results from the last three months of the year.
Americans ran up credit card balances, businesses borrowed more, and historically low mortgage rates encouraged people to refinance mortgages. All good for the economy, and for banks, too.
But the banks took a hit because the European debt crisis made stock and bond markets jumpy.
Lennar 4Q net income falls, new orders rise
Lennar Corp., the nation's third-largest homebuilder, says the housing market is starting to stabilize because of low home prices and low interest rates, making it more appealing to consumers to buy.
The homebuilder reported Wednesday that its fiscal fourth-quarter revenue rose as it delivered more homes, but its net income dropped 5 percent.
For the quarter that ended Nov. 30, Lennar reported net income of $30.3 million, or 16 cents per share. That's down from $32 million, or 17 cents per share, a year earlier.
Supervalu 3rd-quarter loss widens on restructuring costs
EDEN PRAIRIE, Minn. (AP) — Grocery store operator Supervalu Inc. said Wednesday that its fiscal third-quarter net loss widened due to costs related to a turnaround plan, continued high food prices and a cautious consumer.
The company, which operates Albertsons, Jewel-Osco and other supermarkets, trimmed its yearly sales guidance for the second quarter in a row and shares fell more than 10 percent in morning trading.
Supervalu, like most grocers, is trying to raise prices to offset food cost increases without alienating shoppers who have cut spending. Supervalu is also facing costs related to a restructuring plan, begun well over a year ago, which has involved closing stores, selling off some businesses, lowering debt and tailoring its stores to meet local needs.
CEO: Archer Daniels Midland to cut 1,000 jobs
ST. LOUIS (AP) — Agribusiness conglomerate Archer Daniels Midland Co. announced plans Wednesday to cut 1,000 jobs, or about 3 percent of its total workforce, with the majority of the positions being salaried staff.
The move will cut about 15 percent of the Decatur, Ill.-based company's corporate staff, CEO Patricia Woertz said in statement.
Archer Daniels Midland reported $2.03 billion in profits for the last fiscal year alone, but a volatile global market for crops has made for unpredictable revenue. Corn and soybean prices have seesawed violently this year, hitting near-record levels only to plunge again in a matter of months. Such swings can quickly wipe out profits, so Archer Daniels Midland is looking to cut as much overhead costs as it can.
By The Associated Press(equals)
The Dow Jones industrial average dropped 13.02 points, or 0.1 percent, to close at 12,449.45. The S&P 500 gained 0.4 of a point on Wednesday to 1,292.48. The Nasdaq composite index rose 8.26, or 0.3 percent, to 2,710.76.
Benchmark crude fell by $1.37 to finish at $100.87 per barrel in New York. Brent crude, which is used to price foreign oil varieties that are imported by U.S. refineries, fell by $1.04 to end at $112.24 per barrel in London.
The natural gas futures contract fell 17 cents to end the day at $2.77 per 1,000 cubic feet.
Heating oil lost 4 cents to finish at $3.06 per gallon and gasoline futures fell 1 cent to end at $2.76 per gallon.