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WICS Newschannel 20 :: News - Business News

Business News

Last Update on July 29, 2014 07:37 GMT

WORLD MARKETS

SEOUL, South Korea (AP) -- Asian stock markets posted modest gains today as investors treaded cautiously ahead of U.S. and Chinese economic reports later this week.

Japan's Nikkei added 0.5 percent to 15,604.80 and South Korea's Kospi rose 0.6 percent to 2,061.95.

Hong Kong's Hang Seng inched up 0.2 percent to 24,483.85 while China's benchmark Shanghai Composite gained 0.1 percent to 2,180.52.

Australia's S&P/ASX 200 was down 0.1 percent to 5,570.90.

Markets in India, Indonesia and Malaysia were closed for holidays.

WASHINGTON (AP) --Federal Reserve policymakers open a two-day meeting later this morning. They will be watched closely for any significant changes in the low-interest rate policy the board has pursued since the Great Recession of 2009 under then-Chairman Ben Bernanke and now Janet Yellen.

The Fed chief told Congress earlier this month that it would be a serious mistake for lawmakers to require the nation's central bank to adopt a formal policy rule to guide its decisions on setting interest rates.

Also due today are the Standard & Poor's Case-Shiller index of home prices for May and the Conference Board's Consumer Confidence index for July.

Among the quarterly financial results due today before the market opens are t hose from Aetna Inc., Merck & Co., Pfizer Inc., Reynold American Inc., and UPS Inc.

MEDICARE-SOCIAL SECURITY

WASHINGTON (AP) -- The government says Medicare's finances have improved. The program's hospital trust fund won't be exhausted until 2030 -- four years later than last year's estimate.

Social Security's massive retirement program will remain solvent until 2034, although disability benefits are in more immediate danger.

The disability trust fund is now projected to run dry in 2016. At that point, the program will collect enough taxes to pay 81 percent of benefits.

The trustees who oversee Social Security and Medicare issued their annual report Monday on the financial health of the government's largest benefit programs.

DEBT STUDY

WASHINGTON (AP) -- A study by the Urban Institute shows that more than 35 percent of Americans have debts and unpaid bills that have been reported to collection agencies.

These consumers fall behind on credit cards or hospital bills. Their mortgages, auto loans or student debt pile up, unpaid. Even past-due gym membership fees or cellphone contracts can end up with a collection agency, potentially hurting credit scores and job prospects.

The study by the Washington-based think tank released Tuesday points to a disturbing trend: The share of Americans in collections has remained relatively constant, even as the country as a whole has whittled down the size of its credit card debt since the official end of the Great Recession in the middle of 2009.

SOUTHWEST AIRLINES

WASHINGTON (AP) -- Southwest Airlines has 30 days to respond to a proposed $12 million government civil fine for failing to comply in three separate cases with safety regulations related to repairs on Boeing 737 jetliners.

The FAA says that beginning in 2006, Southwest made "extreme makeover" alterations to eliminate potential cracking of the aluminum skin on 44 jetliners. The agency also says that its investigation determined that Southwest's contractor, Aviation Technical Services Inc. of Everett, Washington, failed to follow proper procedures for replacing the fuselage as well as other work on the planes. It said that all of the work was done under the supervision of Southwest, which was responsible for seeing that it was done properly.

The FAA said that Southwest then returned the planes to service in 2009 and began flying them even after the FAA said these aircraft were not in compliance with safety regulations.

Brandi King, a spokeswoman for Southwest, said the airline will "respond to the FAA allegations" in accordance with the agency's procedures.

FORD-NEW PICKUP

DETROIT (AP) -- Ford is raising the price of its new aluminum-sided pickup truck, while trying to stay competitive with rivals.

Ford released pricing on the truck Monday. It goes on sale later this year.

The new truck comes in five variants, down from 10 on the current truck. All have aluminum sides, which is more expensive than steel but weighs less and saves fuel.

Ford's base XL and XLT models -- which make up 70 percent of sales -- will cost $395 more. A fancier King Ranch costs $3,615 more, but includes new standard features like a heated steering wheel.

The base XL will start at $26,615, including destination fees. That's slightly higher than the Ram pickup but lower than the Chevrolet Silverado.

The most-expensive Platinum version will start at $55,235.

ARGENTINA-DEBT

BUENOS AIRES, Argentina (AP) -- Argentina's government says it will make another effort to reach a deal with US. creditors ahead of a looming deadline that risks sending the country into its second default in 13 years.

Cabinet Chief Jorge Capitanich said an Argentine delegation would be in New York to meet with a court-appointed mediator Tuesday, just a day ahead of the deadline.

Capitanich said Argentina's position "is to reach a dialogue that establishes fair, legal and sustainable conditions for negotiation with 100 percent of the bondholders." He spoke at a news conference at the presidential palace in Buenos Aires.

But the mediator, Daniel A. Pollack, said in a statement that while the Argentines would meet him, they had not yet accepted his recommendation of face-to-face talks with the plaintiffs in the dispute, led by New York billionaire Paul Singer's NML Capital Ltd.

DARDEN-MANAGEMENT

NEW YORK (AP) -- Darden Restaurants says CEO and chairman Clarence Otis is stepping down as the company fights to fix its flagship Olive Garden chain following the sale of Red Lobster.

The company, based in Orlando, Florida, also says it's changing its corporate policies to split the chairman and CEO roles.

Darden said Monday that it appointed its current lead independent director, Charles Ledsinger, Jr., as independent non-executive chairman, effective immediately. Otis will serve as CEO until a successor is named, or Dec. 31, whichever comes first.

Darden Restaurants Inc. had been under fire for failing to turn around declining sales at Olive Garden and Red Lobster. Earlier on Monday, it said its contested sale of Red Lobster was finalized.

Otis became CEO in late 2004, adding the chairman role a year later.

NBA-CLIPPERS-STERLING

LOS ANGELES (AP) -- A judge has ruled against Los Angeles Clippers owner Donald Sterling and cleared the way for the $2 billion sale of the team to ex-Microsoft CEO Steve Ballmer.

Judge Michael Levanas sided with Sterling's estranged wife Monday in the case that arose after the 80-year-old billionaire was banned by the NBA for making offensive remarks about blacks.

Shelly Sterling sought the court's approval for the deal she negotiated after taking control of a family trust. She removed her husband as a trustee after two doctors found he had Alzheimer's disease and couldn't manage his affairs.

Donald Sterling claimed his wife deceived him about the medical exams.

EARNS-HEALTHSOUTH

BIRMINGHAM, Ala. (AP) -- HealthSouth Corp. (HLS) has reported profit that declined by 49 percent in its second quarter, but adjusted earnings still beat analysts' expectations.

The Birmingham, Alabama-based company said Monday that net income after preferred dividends fell to $81.6 million, or 85 cents per share, from $159.4 million, or $1.66 per share, in the same quarter a year ago.

Earnings, adjusted for non-recurring gains and to account for discontinued operations, came to 54 cents per share. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 48 cents per share.

The rehabilitation hospital operator said revenue rose 7.1 percent to $604.4 million from $564.5 million in the same quarter a year earlier, and beat Wall Street forecasts. Analysts expected $588.2 million, according to Zacks.

HealthSouth shares climbed $2.86, or 7.6 percent, to $40.50 in after-hours trading. The stock has increased $4.32, or 13 percent, to $37.64 since the beginning of the year and has risen 14 percent in the last 12 months.

CYPRUS-BANKS

NICOSIA, Cyprus (AP) -- The largest bank in Cyprus says it has bolstered its capital base by raising 1 billion euros ($1.34 billion) through a private placement of new shares.

Bank of Cyprus said in a statement late Monday that the new shares each valued at 0.24 euros ($0.32) went to institutional investors form Europe, North America and Russia.

It said that existing shareholders will get a chance to buy back up to 20 percent of those shares, but that the total capital raised would remain at 1 billion euros.

The bank said this will speed up its restructuring plans and help it pass European tests gauging its health this year.

Bank of Cyprus figured prominently in the country's multibillion-euro rescue last year that sanctioned a grab of uninsured deposits in its two biggest lenders.

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Modest gains

SEOUL, South Korea (AP) -- Asian stock markets posted modest gains today as investors treaded cautiously ahead of U.S. and Chinese economic reports later this week.

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