Crude oil prices exceeded $35 a barrel for the first time in more than two years, propelled by concern that U.S. supplies will remain low because of the general strike in Venezuela. The price of crude for February delivery reached $35.20 but closed at $34.61 a barrel, up 70 cents. It was the highest closing price since Nov. 30, 2000, when it closed at $33.82.

Builders Finish Best Year Since 1986

U.S. home construction surged in December as the lowest mortgage rates in four decades helped make 2002 the best year for the industry since 1986. Builders started new homes at an annual pace of 1.835 million units, up 5 percent from November's 1.747 million rate, the Commerce Department reported. The report said 1.705 million homes were started last year, compared with 1.6 million in 2001.

MORE NEWS

Amtrak plans to seek $1.5 billion to $2 billion in federal funding for its next fiscal year, as much as 67 percent more than its request for this year, in part to fix tracks and update equipment in the Northeast. Chief executive David L. Gunn will recommend the funding proposal to the railroad's board this week. If the board approves the request, Amtrak plans to send it to Congress in February. Congress still is trying to resolve Amtrak's $1.2 billion funding request for its current year.

Taubman Centers rejected a sweetened takeover offer from rival mall owner Simon Property Group, saying the $4.25 billion bid is "inadequate" and reiterating that the company is not for sale.

Microsoft was ordered to start shipping Windows software that includes rival Sun Microsystems' Java programming language. Microsoft planned a quick appeal. A federal judge in Baltimore issued the injunction to enforce his order last month that including Java in Windows was necessary to help erase a competitive advantage Microsoft obtained in illegally defending its operating-system monopoly.

T-bill rates fell. The discount rate on three-month Treasury bills auctioned yesterday fell to 1.16 percent, from 1.18 percent last week. Rates on six-month bills fell to 1.19 percent, from 1.23 percent. The actual return to investors is 1.179 percent on three-month bills, with a $10,000 bill selling for $9,970.70, and 1.215 percent on a six-month bill selling for $9,939.80. Separately, the Federal Reserve said the average yield on one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, fell to 1.38 percent last week from 1.41 percent the previous week.

Japanese companies can't be sued in California by people who say they were forced to work as slave laborers during World War II, the U.S. Court of Appeals for the 9th Circuit ruled. The court said that a 1999 California law allowing victims and their heirs to sue was unconstitutional and that California lacked the power to allow the suits, which weren't provided for under postwar treaties the United States signed with Germany and Japan.

Oracle chief executive Larry Ellison told analysts the company is considering paying a dividend to shareholders, the company's first ever. "But it would depend on Congress approving a tax change," Ellison said. Microsoft said last week that it will pay its first dividend, in light of President Bush's proposal to end the federal tax on dividends.

A committee representing Adelphia Communications stockholders in bankruptcy court said it intends to fight a deal that could pay nearly $41 million to William Schleyer and Ron Cooper, who last week were picked to be the cable firm's new chief executive and chief operating officers. The deal must be approved by the court.

Microsoft, moving into a new realm, is buying a company that provides Web-based conferencing services. Microsoft and PlaceWare of Mountain View, Calif., declined to disclose terms of the deal. Although the company would not disclose sales figures, PlaceWare said it has more than 3,000 customers, including Johnson & Johnson, Deloitte & Touche, Merck and Cisco Systems.

INTERNATIONAL

Japan's central bank left its monetary policy unchanged, continuing its pledge to keep cash flowing in the financial sector to help the struggling economy. The Bank of Japan decided after a two-day policy meeting to keep the target of 20 trillion yen ($169 billion) for excess cash in the banking system. Some politicians want the central bank to do more, such as set inflation targets to stem the continuous plunge in prices, a situation called deflation, which has been draining the economy.

Mexico's currency fell to its weakest level in a decade on concerns that a U.S. war with Iraq and slower U.S. growth will lower demand for Mexican goods and cut direct foreign investment. The peso fell 19 centavos, or 1.8 percent, to 10.83 pesos per U.S. dollar as of late afternoon. It's the weakest point since the currency began circulating Jan. 1, 1993.

LOCAL BUSINESS

Fannie Mae said it will increase its quarterly dividend by 18 percent, to 39 cents a share, on expectations of housing and mortgage market growth. Fannie Mae also said it plans to buy back up to 5 percent of its common stock outstanding as of Dec. 31.

EARNINGS

Citigroup said its fourth-quarter earnings fell 37 percent, to $2.43 billion, as loan losses and the cost of settling allegations that it published misleading stock research sliced profit by $1.55 billion. Consumer banking contributed $2.37 billion in profit -- about 98 percent of the parent company's total -- as the Salomon Smith Barney securities unit lost $344 million.

Ford Motor narrowed its fourth-quarter loss to $130 million, from a loss of $5.07 billion a year earlier, which included restructuring charges. Revenue was $41.6 billion, up $869 million from a year earlier.

Johnson & Johnson reported a 30 percent increase in fourth-quarter profit as sales rose 14.3 percent. Net income was $1.44 billion, compared with $1.1 billion a year earlier. Sales totaled $9.4 billion.

Motorola reported a fourth-quarter profit of $174 million, saying its second straight quarterly gain showed that a two-year restructuring is paying off. The maker of cell phones and semiconductors lost $1.2 billion in the same period last year. Revenue rose 3 percent, to $7.5 billion, substantially higher than the company predicted.

Northwest Airlines reported a fourth-quarter loss of $488 million, compared with a loss of $216 million a year earlier. Revenue rose 18 percent, to $2.34 billion. Northwest also announced it recorded a $1 billion after-tax reduction in shareholder equity to account for underfunded pension plans.

Charles Schwab Corp. reported its first back-to-back quarterly deficits, extending the worst financial funk in the brokerage's history. The San Francisco-based company posted a fourth-quarter loss of $79 million on revenue of $996 million, compared with a loss of $13 million on sales of nearly $1.1 billion in the 2001 period. Excluding one-time charges, Schwab said it would have posted a profit of $86 million.

3M said fourth-quarter profit rose 34 percent, to $511 million, as earnings increased more than 10 percent in all six of its business segments. The diversified manufacturing company said sales increased 7 percent, to $4.14 billion.

Wells Fargo's fourth-quarter profit rose 19 percent, to $1.46 billion, as low interest rates led more customers to refinance mortgages and the company wrote off fewer bad loans. The fourth-biggest U.S. bank posted net income of $1.18 billion in the year-earlier quarter. Revenue rose to $6.48 billion, up 10 percent from the fourth quarter a year earlier.

Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers

Washington businessman C. Gregory Earls, shown leaving federal court in December, is talking with prosecutors in Manhattan about the charges that he faces in connection with alleged diversion of millions in investor money to his own use, a federal magistrate judge wrote. Prosecutors now have an additional month to ask a grand jury to indict Earls, chairman and chief executive of U.S. Technologies, an Internet company whose all-star board of directors included former FBI director William H. Webster.