Insider-trading indictment, growing momentum in U.S. economy

March 21, 2013
WALL STREET
Grand jury indicts
Rajaratnam brother

Rengan Rajaratnam, the brother of imprisoned hedge-fund founder Raj Rajaratnam, was indicted by a federal grand jury for allegedly taking part in an insider-trading scheme tied to the Galleon Group.

Rengan Rajaratnam, 42, is accused of conspiring with his brother to trade on material non-public information about Clearwire and Advanced Micro De­vices in 2008, U.S. Attorney Preet Bharara said Thursday.

Prosecutors alleged that Rengan Rajaratnam, while working as a fund manager at Galleon, made almost $1.2 million on trades that occurred March 24 and March 25, 2008.

The Securities and Exchange Commission brought a lawsuit against Rengan Rajaratnam. His whereabouts were not immediately clear. David Tobin, his attorney, did not return a call seeking comment on the charges.

— Bloomberg News

ECONOMY
Growing momentum
seen in U.S. finances

A clutch of data pointed to growing momentum in the economy during the first quarter, with jobless claims trending lower and factory activity and home sales on the rise.

The reports Thursday built on recent upbeat data on hiring and consumer spending that have led many economists to see a sharp rebound in economic growth despite the onset of increased fiscal austerity.

While the number of Americans filing new claims for jobless benefits edged higher last week to 336,000, the four-week average fell last week to 339,750, down 6 percent relative to the survey week in February.

Separately, two surveys of industry showed an increase in activity at U.S. factories. The Philadelphia Federal Reserve Bank said manufacturing activity in the Mid-Atlantic region grew in March after contracting for two months in a row. And the financial data firm Markit said its preliminary Manufacturing Purchasing Managers Index, which gauges activity nationwide, ­increased to 54.9 this month from 54.3 in February.

Housing sector data also was upbeat. The National Association of Realtors said ­existing-home sales increased 0.8 percent to an annual rate of 4.98 million units last month, the highest level since November 2009.

— Reuters

ALSO IN BUSINESS

l  Timothy F. Geithner, who finished his term as U.S. Treasury secretary in January, has found a buyer for his house in Bethesda, just a week after listing the home for $995,000. Geithner’s four-bedroom property on Ogden Road is under contract with some contingencies but isn’t dependent on a buyer selling a current house to close the deal, according to the Web site of the brokerage Redfin. Geithner’s home was listed March 14. His real estate agent, Matthew Maury of Stuart & Maury declined to comment. Jenni LeCompte, Geithner’s spokeswoman, also declined to comment.

l  Coca-Cola said it is cutting 750 U.S. jobs as it continues to streamline its business. The cuts represent about 1 percent of the company’s workforce of 75,000 in North America. A spokesman said that about a quarter of the cuts will be in Atlanta, where the company is based.

l  Freddie Mac said Thursday that the average rate for a ­30-year fixed mortgage fell to 3.54 percent, from 3.63 percent last week. That’s near the 3.31 percent reached in November, the lowest on records dating to 1971. The average rate on 15-year loans slipped to 2.72 percent, from 2.79 percent last week. The record low is 2.63 percent.

l  Oracle reported sales and profit that missed analysts’ estimates as corporate customers transitioning to Internet-based cloud systems bought less hardware and software. Shares fell nearly 10 percent to $32.30 for the biggest decline since December 2011.

— From news services

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