The Senate, on a voice vote, approved President Bush's nomination of investment banker William H. Donaldson as the new chairman of the Securities and Exchange Commission. The 71-year-old former New York Stock Exchange chairman has promised to work to rebuild investor confidence shattered by last year's wave of corporate scandals. Donaldson, who has ties to the Bush family, will replace Harvey L. Pitt, who resigned under fire in early November after a series of political missteps.
Trade Dispute Heats Up
Canada and other major U.S. trading partners threatened hundreds of millions of dollars in sanctions if Congress doesn't repeal a law that allows U.S. companies to collect duties won in unfair-trade cases. The World Trade Organization has ruled the measure illegal. The European Union and Canada gave the United States 15 months to change the law, under which more than $500 million has been doled out in the past two years to U.S. companies. An aide to Sen. Robert C. Byrd (D-W.Va.), who wrote the law, said there will be no repeal.
William Clay Ford Jr., chief executive of Ford Motor, will sell his 400,000 Goldman Sachs Group shares "so they don't become a distraction to the company's business," spokesman Jim Vella said. Bill Ford, as a private client of Goldman Sachs, bought the shares in Goldman's 1999 initial public offering for $53 each. Based on a closing price of $64.92 yesterday, he would have a profit of $4.77 million. Ford directors rejected a shareholder demand that the CEO sell the shares to the company at the original price because he gained the chance to buy the stock because of his ties to the automaker. Goldman has been among Ford Motor's bankers since the automaker went public in 1956.
Delta Air Lines was barred by an arbitration panel from laying off more pilots after the union for the cockpit crews filed a contract grievance. Delta's unit of the Air Line Pilots Association said the planned layoff of 20 pilots on March 2 was canceled as a result of the ruling.
Kmart told a bankruptcy court that it wants to cancel leases on hundreds of its self-checkout machines because they cost too much to maintain and increase the risk of theft. It estimates that it could save $55.7 million by ending the contract with GE Capital.
Smith & Wesson introduced its biggest handgun ever, a .50-caliber Magnum. The five-shot revolver with an 81/2-inch barrel weighs about 41/2 pounds -- roughly a pound more than the .44 Magnum used by Clint Eastwood's Dirty Harry character. A spokesman said big-game hunting is the primary market for the weapon.
Bethlehem Steel said that as many as 36 percent of its workers will lose their jobs as a result of International Steel Group's buyout of the company. Robert S. Miller, Bethlehem's CEO and chairman, told employees that 3,000 to 4,000 jobs will be cut from the company's current workforce of 11,000.
United Airlines said it plans to shift about 30 percent of its U.S. capacity into the new discount airline it is forming as part of its effort to emerge from Chapter 11 bankruptcy protection.
New York State Attorney General Eliot L. Spitzer sued GlaxoSmithKline and Pharmacia, accusing them of illegally inflating prescription-drug prices in schemes that cost consumers and taxpayers tens of millions of dollars each year. The suit accuses the drugmakers of consumer fraud, commercial bribery and making false statements to government health plans. A third pharmaceutical company, Aventis, was served with a pre-litigation notice, and Spitzer said the same allegations apply. All three companies denied Spitzer's allegations, saying their practices were legal.
Paraguay failed to pay investors who exercised options to have their bonds repurchased, prompting Standard & Poor's to cut its credit rating to default. The default by Paraguay and concerns of a default in Uruguay underscore the difficulties some South American countries have in meeting debt payments amid shrinking economies.
Japan's economy mustered growth of 0.5 percent in the final three months of 2002, but analysts warned that prospects for a continuing rebound were slim. The gross domestic product -- the value of a nation's goods and services -- showed the fourth consecutive quarter of growth after three consecutive quarters of contraction, according to the report from the Cabinet Office.
AES, the Arlington-based power producer trying to keep overseas businesses afloat, will miss a $336 million payment for the takeover of Latin America's largest electricity distributor, putting AES in jeopardy of losing the company to the Brazilian government. Brazil's government development bank last month gave AES until Feb. 28 to make the payment for the purchase of Eletropaulo Metropolitana in Sao Paulo in the 1990s, but the company won't have the cash to pay, said AES chief executive Paul T. Hanrahan.
Fannie Mae said its loan portfolio grew at an annualized rate of 35 percent in January, almost three times the pace for all of 2002, as more people refinanced their homes. The enterprise's portfolio, which accounts for two-thirds of its profit, increased to $810.6 billion, from $790.8 billion.
Genesis Health Ventures will spin off its Baltimore-based ElderCare business as a separate company. Chief Financial Officer George Hager will head the independent company, which will maintain headquarters in Baltimore. Genesis said in October it wanted to divest ElderCare, which operates 246 facilities in 14 states, to focus on expanding its institutional pharmacy business.
American International Group, the world's largest insurer, had its first quarterly loss in at least three decades as it added $3.2 billion to reserves. But its shares rose as much as 5.4 percent after the company said it expects to earn more this year than analysts predicted. The fourth-quarter loss of $103.8 million compared with a profit of $1.87 billion in the same period a year earlier.
Campbell Soup's profit increased 14 percent, to $231 million, in its fiscal second quarter, as the company's international divisions and cookies and confectionary businesses such as Pepperidge Farm surged.
Hasbro, the nation's second-largest toymaker, earned $62.2 million in the three months ended Dec. 29, up from $52.5 million in the year-earlier quarter. Sales rose to $997.4 million, from $988.7 million.
Loews said fourth-quarter net income rose 52 percent, to $290.2 million, from a year ago, helped by a rebound at its insurance unit CNA Financial. The company also restated earnings for the first nine months of 2002 and all of 2001 and 2000 due to an accounting change regarding investments in contracts that buy out life insurance policies of people with terminal illnesses for a fraction of their face value.
May Department Stores, the company that owns retailers Hecht's, Lord & Taylor and Filene's, said profit dropped 11.3 percent in its fourth quarter, to $387 million. Sales were $4.37 billion, down from $4.57 billion.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers