INFLATION BELOW 2 PERCENT: Inflation was firmly under control as the new year began. Consumer prices rose by just 1.9 percent in 2003, while the underlying rate of inflation, which excludes food and energy prices, registered its smallest increase in 43 years. The increase in the consumer price index was the smallest since 2001 and compares with 2.4 percent in 2002. Cheaper computers, cars and clothes helped to blunt more expensive medical care, college tuition, beef and energy products. Excluding food and energy prices, which tend to be volatile, core consumer prices rose by just 1.1 percent last year, the smallest increase since 1960.
UNEMPLOYMENT CLAIMS DROP: New claims for unemployment benefits dipped by a seasonally adjusted 11,000 last week to 343,000, the Labor Department said. This report suggested companies are feeling more confident the recovery is real and thus are slowing the speed at which they lay off workers. The four-week moving average of claims, which smooths out weekly fluctuations, dropped last week to 347,500, the lowest level in nearly three years.
TREASURY CALLS '79 BONDS: The Treasury Department said Thursday that it will redeem $4.6-billion worth of 30-year Treasury bonds before they mature, which will save the government about $544-million in interest payments. The "callable" bonds were issued May15, 1979, carry an interest rate of 91/8 percent and mature May 15, 2009. Securities not redeemed by that date stop earning interest. Private investors hold $3.1-billion of the bonds.
MICROSOFT AGREES TO FIX XP: Microsoft Corp. has agreed under pressure to change its Windows software to resolve complaints by the Justice Department that it unfairly influenced how customers buy their music online, the government said Thursday. Microsoft will offer updated software for its Windows XP operating system in February or March to stop its practice of compelling consumers who buy music on the Web to use only Microsoft's Internet browser. The company maintains its design was legal. Government lawyers concluded that the design violated the antitrust settlement of 2002.
US AIRWAYS LOSES EXECS: US Airways said four vice presidents have resigned to take jobs at other companies. Some duties of those departing will be taken over by current executives, the company said. "Our executives are being recruited away," said US Airways spokesman David Castelveter. US Airways also said it plans to go ahead with previously announced layoffs of 200 flight attendants after an arbitrator ruled that the company must offer voluntary furloughs before any involuntary layoffs. Some of the workers laid off may be called back if other attendants volunteer for furloughs, the company said.
STEWART JURY QUESTIONING SECRET: U.S. District Judge Miriam Goldman Cedarbaum said Thursday that reporters will not be allowed to watch the questioning of prospective jurors in the Martha Stewart case - a process usually held in open court. Cedarbaum said she was concerned reporters might disclose potential jurors' names and responses. The judge said she would release a transcript of the interviews the following day, with names withheld. The interviews are to begin Tuesday. Lawyers for media covering the trial planned to ask the judge to reconsider her ruling today.
TI CEO STEPS ASIDE: Semiconductor maker Texas Instruments Inc. said Thursday that Thomas J. Engibous will step down as president and chief executive May1 and be replaced by chief operating officer Richard K. Templeton. Officials at Texas Instruments termed the change a planned and orderly succession. Engibous, 50, will remain chairman of the Dallas company. Templeton, 45, is a 23-year TI veteran. He was named chief operating officer in April 2000 and joined the board of directors last year.
AT&T WIRELESS RUMOR LIFTS STOCK: AT&T Wireless Services Inc. stock jumped to a 52-week high Wednesday following several reports that it is once again in discussions to be acquired by Cingular Wireless. Shares of AT&T Wireless closed up $1.44, or 17 percent, at $9.99, on the New York Stock Exchange. The Wall Street Journal and other media outlets reported Wednesday that Cingular, the nation's second-largest wireless carrier in terms of subscriber numbers, is in discussions to acquire AT&T Wireless.
SBA REOPENS LOAN PROGRAM: The government reopened its biggest loan program for small businesses Wednesday, a week after suspending it for a shortage of money, with an additional $470-million in temporary lending authority. But the Small Business Administration, which runs the program of loan guarantees intended to help businesses that can't qualify for regular loans from banks, warned that the new money may not be sufficient to keep the program operating through Jan. 31 if demand for loans remains high.
US AIRWAYS TO SHUT REGIONAL: US Airways announced plans Wednesday to shut down its Allegheny Airlines subsidiary by the end of March, either by merging operations into another subsidiary or by liquidation. Allegheny Airlines, based near Harrisburg, Pa., employs 1,421 workers and serves 38 cities, mostly in the mid-Atlantic region. The job losses associated with the plan are uncertain. The airline said its preferred path is to merge Allegheny's operations into Piedmont Airlines, a subsidiary in Salisbury, Md.
ALPINE TO BUY CANDY BRANDS: Archibald Candy Corp. said Wednesday it has signed a preliminary agreement to sell its Fannie May and Fanny Farmer brands to Alpine Confections Inc. Terms of the deal were not disclosed. The sale would not affect a plan announced earlier this month to close all 228 Fannie May and Fanny Farmer retail stores by mid-February. Under the agreement, however, Alpine might re-open some stores after an evaluation period.
HEALTHSOUTH GETS COMPLIANCE OFFICER: HealthSouth Corp. has hired an experienced compliance officer as the company tries to improve its credibility after a major accounting scandal. The company also said Tuesday it has adopted new rules to ensure an independent board and separated the jobs of chairman and chief executive. HealthSouth said John Markus will join the company as chief compliance officer. Markus comes to HealthSouth from Fresenius Medical Care North America, where he was president of corporate compliance.
Earnings:
Raymond James FinancialInc.: A robust stock market, low interest rates and surging investor confidence contributed to a strong quarter for the St. Petersburg financial services company. Net income rose 68 percent on a 23 percent increase in revenues for the fiscal first quarter ended Dec. 26. Commissions and fees, investment banking revenues and trading profits were all up sharply.
The results for the quarter reflect a reduction in net income of about 8 cents per share for increased reserves to settle issues related to overcharging some clients who bought mutual funds. The company previously announced it is reimbursing clients and expects to be penalized by the Securities and Exchange Commission. Raymond James stock rose $1.05 per share Wednesday, closing at $37.40.
IntelCorp.: Intel posted better-than-expected profits and record revenue in the fourth quarter, a period marked by robust global demand for the company's computer chips in laptop, desktop and business machines. Analysts expected Intel to post a profit of 25 cents per share on sales of $8.65 billion, according to a survey by Thomson First Call.
Yahoo!Inc.: The Internet powerhouse's robust recovery from the dot-com downturn continued, as it rode a rising wave of online advertising to a 62 percent increase in its fourth-quarter profit. Online advertising accounted for 82 percent, or $545 million, of Yahoo's fourth-quarter revenue. The earnings matched the mean estimate among analysts surveyed by Thomson First Call.
Apple ComputerInc.: Strong holiday sales of portable notebook computers and the iPod music player helped Apple's first-quarter results easily beat Wall Street expectations. Analysts surveyed by Thomson First Call had projected earnings of 15 cents a share on revenue of $1.9-billion.
