Housing starts unexpectedly rose to a 16-year high in January as the lowest mortgage rates since the 1960s kept new homes selling at a record pace in December. Builders broke ground on new homes at an annual rate of 1.85 million units last month, the Commerce Department said, up 0.2 percent from December.
Saudis Back Lifting Quotas in Wartime
OPEC's largest producer, Saudi Arabia, will support a temporary suspension of the group's oil-production quotas should a U.S.-led military attack halt Iraqi exports, OPEC officials said. Most members of the Organization of Petroleum Exporting Countries ignored their output quotas after Iraq's invasion of Kuwait in 1990 disrupted exports from both countries and caused prices to surge to $40 a barrel. Iraq doesn't have a quota because its trade is under United Nations supervision.
Lucent Technologies, whose stock has plunged 97 percent from its 1999 high, said shareholders approved a reverse stock split to keep the stock above $1 and avoid a delisting from the New York Stock Exchange. Lucent, the largest U.S. maker of telephone equipment, hasn't decided what ratio it would use for the reverse split. It has proposed ratios of one share for every 10 through one for every 40. Also, outgoing chairman Henry B. Schacht relinquished his title to chief executive Patricia F. Russo after the company's annual shareholders meeting.
The University of Michigan ordered a researcher to stop trading in shares of companies that form the basis of a consumer-satisfaction survey before the results are made public. The university acted after Claes Fornell, an economist and head of the university's National Quality Research Center, said he traded in stocks of companies included in the center's American Customer Satisfaction Index before releasing the data. The university's action doesn't address its widely followed consumer-confidence index.
The interest rate on four-week Treasury bills was 1.155 percent at the government's weekly auction, unchanged from a week earlier. The return to investors was 1.174 percent, with a $10,000 Treasury bill selling for $9,991.10.
Microsoft agreed to buy Connectix's "virtual machine" technology, which allows one operating system on a computer to run other operating systems, as well as its Virtual PC software for Mac and Windows. The acquisition, for an undisclosed amount, also includes a third emulation program that San Mateo, Calif.-based Connectix has been developing for use on server computers. Microsoft said it would continue selling and developing the Mac OS version of Virtual PC, Connectix's best-known program, which allows Windows-only software to be used on a Mac.
Blue Cross of Northeastern Pennsylvania, saying it had made a "huge mistake," reversed a new rule excluding coverage for illnesses or injuries caused by acts of terrorism. Blue Cross, and most other health insurance companies, have long refused coverage for injuries suffered in wartime. After Vietnam, many health insurers added an exclusion for "undeclared" wars. But industry experts said they weren't aware of any other health insurance company refusing to cover terrorist acts.
Nissan's financing arm has agreed to stop marking up loan rates offered to minority buyers under a proposed settlement of a class-action federal discrimination lawsuit. Nissan Motor Acceptance also agreed to tell car buyers their interest rate may be negotiable. The agreement seeks to settle a 1998 lawsuit by 10 black and Hispanic car buyers from Tennessee and Florida who said NMAC charged them higher interest rates on car loans than whites with similar credit ratings. Under the deal, NMAC would also pay $5,000 to $20,000 to each plaintiff plus $1 million to America Saves, a Washington-based consumer agency. Lawyers said the suit involved about 125,000 plaintiffs.
A former hedge fund manager and Chicago Board Options Exchange trader was indicted on charges that he swindled about 55 investors out of more than $21 million. Edward Thomas Jung, 57, was manager of the now-defunct Strategic Income Fund LLC and controlling partner of ETJ Partners. He falsely promised investors he would trade stock options with their money, the indictment said. Jung's indictment comes as the Securities and Exchange Commission increases scrutiny of hedge funds, loosely regulated private partnerships for wealthy individuals and institutions, because of an increase in fraud.
Debt ratings of 10 U.S. airline companies were cut by Standard & Poor's because the value of airplanes that back the debt has fallen by as much as 45 percent since the Sept. 11, 2001, terrorist attacks. The lower ratings were issued for AMR, UAL, Delta, America West Airlines, American Trans Air, Atlantic Coast Airlines Holdings, Continental Airlines, Northwest Airlines, Southwest Airlines and US Airways.
Progressive, the biggest U.S. motorcycle insurer, is selling the first policies for Segway's Human Transporter, the $4,950 self-balancing scooter that hits sidewalks next month. Full coverage will range from about $92 a year in suburban Cleveland to $259 in New York City.
Ford Motor announced a voluntary recall of all 1997 Ford Escorts and Mercury Tracers to install a shield over the cars' air-bag monitor. The world's No. 2 automaker said fluid leaks or condensation from the heater case could contaminate the monitor, causing system failure. About 441,000 cars worldwide are affected. Most are in the United States.
Finland surpassed the United States to take the top spot in global rankings of nations' abilities to benefit from information and communication technology. The report by the World Economic Forum, the World Bank and Insead, a French-based business school, used 64 criteria to do the ranking. Filling out the top 10 were the United States, Singapore, Sweden, Iceland, Canada, Britain, Denmark, Taiwan and Germany.
Constellation Energy agreed to buy almost all of CMS Energy's power-trading and supply contracts for an undisclosed amount. The sale is subject to review by the Federal Energy Regulatory Commission. Constellation, the owner of Baltimore Gas & Electric, has been acquiring assets from rivals that lost money after the bankruptcy of Enron sparked a collapse in energy trading.
Fuel distributors Cook's Fuel and Energy Services, based in Baltimore, and Mifco, based in Manassas and Woodbridge, were acquired by CH Energy Group. Terms were not disclosed by the New York company.
Pharmacia, the company being bought by No. 1 drugmaker Pfizer, said its quarterly profit rose more than 600 percent, to $554 million, helped by a legal settlement and rising prescriptions for medicines to treat arthritis pain. Sales rose 1 percent, to $3.74 billion. Earnings in the fourth quarter of 2001 were hurt by losses and costs of $290 million related to Pharmacia's Monsanto agricultural unit. In 2002, Pharmacia had a gain of $62 million from a settlement with Allergan.
Qwest Communications International announced that one-time gains helped it to a $2.7 billion profit in the fourth quarter, compared with a loss of $645 million a year ago. But revenue fell 11 percent, to $3.7 billion, as the regional phone company's core business remained sluggish. Qwest said that without one-time events it would have lost money.
Volkswagen said its 2002 profit fell 11 percent, to $2.76 billion, because of weak sales in key markets such as Germany and the United States. Revenue slipped 1.8 percent, to $93.9 billion.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers