Industry News

TMCNet:  AP Business NewsBrief at 7:44 p.m. EST

[February 23, 2009]

AP Business NewsBrief at 7:44 p.m. EST

(AP Online Via Acquire Media NewsEdge) Major stock market indexes fall to 1997 levelsNEW YORK (AP) _ Wall Street has turned the clock back to 1997. Investors unable to extinguish their worries about a recession that has no end in sight dumped stocks again Monday. The Dow Jones industrial average tumbled 251 points to its lowest close since May 7, 1997, while the Standard & Poor's 500 index logged its lowest finish since April 11, 1997. It's as if the decade's dot-com surge, collapse and subsequent recovery never occurred.

Feds explore taking bigger stakes in shaky banksWASHINGTON (AP) _ The government on Monday moved toward dramatically expanding its ownership stakes in the nation's banks _ with Citigroup, the struggling titan of the industry, apparently at the top of the list. Wall Street responded as it has with the rollout of almost every other plan to fix the financial crisis, taking a big drop and sending the Dow Jones industrials to its lowest level in a dozen years.

Judge orders Thain to testify on Merrill bonusesCHARLOTTE, N.C. (AP) _ A New York judge cleared the way Monday for former Merrill Lynch & Co. CEO John Thain to testify about bonuses paid to Merrill employees before the company was sold to Bank of America Corp. New York's Attorney General Andrew Cuomo filed a motion in the state's Supreme Court Monday asking that Thain be compelled to provide details on the bonuses, which he had declined to give during a deposition Thursday. Thain's attorney Andrew Levander later Monday said that the motion was granted and Thain will answer the questions Tuesday.

COO Peter Chernin to depart News Corp. in JuneLOS ANGELES (AP) _ Peter Chernin, president and chief operating officer of News Corp., will step down when his contract expires June 30, the company said Monday. The vacancy likely clears the eventual path to succession for Chief Executive Rupert Murdoch's son James, the 36-year-old executive in charge of News Corp.'s businesses in Europe and Asia. The elder Murdoch, 77, controls more than a third of the media conglomerate's shares and that control will be passed on to his four eldest children in a family trust in time.

More newspaper shake-ups loom with Chapter 11With the four owners of 33 U.S. daily newspapers seeking bankruptcy protection in the past 2 1/2 months, even more upheaval looms for an industry clearly gasping for survival. Analysts doubt those newspaper companies will be able to emerge from Chapter 11 bankruptcy protection without agreeing to lenders' demands for radical changes, such as switching some of their newspapers exclusively to online delivery.

Rattner to advise Treasury on auto industryWASHINGTON (AP) _ The White House selected a Wall Street financier on Monday to advise Treasury Secretary Timothy Geithner on the restructuring of General Motors Corp. and Chrysler LLC. Steven Rattner, co-founder of Quadrangle Group LLC, will serve as counselor to Geithner, who is leading an auto industry task force charged with shaping the future of GM and Chrysler.

JPMorgan Chase slashes dividend by 87 percentNEW YORK (AP) _ JPMorgan Chase said Monday it will slash its quarterly dividend to 5 cents per share from 38 cents in a bid to preserve capital. Chief Executive Jamie Dimon said the cut was a precautionary measure to ensure that the company has financial flexibility should economic conditions drastically worsen. The move will save the company about $5 billion per year.

UAW reaches health care trust fund deal with FordDETROIT (AP) _ The United Auto Workers and Ford Motor Co. said Monday they agreed to let the automaker change how it pays for a health care trust fund for retired workers, a deal that could serve as the model for cash-starved General Motors Corp. and Chrysler LLC. Ford said the agreement allows it to make payments to the union-managed trust with up to 50 percent of company stock instead of cash. Having the UAW take equity frees up cash for operations.

Obama pledges to slash deficit _ after increaseWASHINGTON (AP) _ Urging strict future restraint even as current spending soars, President Barack Obama pledged on Monday to dramatically slash the skyrocketing annual budget deficit as he started to dole out the record $787 billion economic stimulus package he signed last week. "If we confront this crisis without also confronting the deficits that helped cause it, we risk sinking into another crisis down the road," the president warned, promising to cut the yearly deficit in half by the end of his four-year term. "We cannot simply spend as we please and defer the consequences." Official: Obama likely to name Locke to CommerceWASHINGTON (AP) _ President Barack Obama's likely third pick for Commerce secretary is former Washington Gov. Gary Locke, a senior administration official said Monday. Locke, a Democrat, was the nation's first Chinese-American governor when he served two terms in the Washington statehouse from 1997 to 2005.

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