Factory Orders Up 2.9 Percent
U.S. factory orders rose by 2.9 percent in May, the biggest gain in 14 months, with most of the strength reflecting robust demand for airplanes and parts. The sizable advance came after 0.7 percent increases registered in both March and April, the Commerce Department reported. Performances by sector were uneven. New bookings for machinery and computers fell in May. Orders for cars and primary metals, including steel, were flat. But demand for airplanes, household appliances and furniture all posted gains. Orders for food products and clothing also went up.
Cutler Returning to Old Firm
Former Securities and Exchange Commission enforcement chief Stephen M. Cutler, left, will return to D.C. law firm Wilmer Cutler Pickering Hale and Dorr in the fall. Cutler, who quit the SEC in May after four years, will be a partner and co-chairman of the firm's 200-lawyer securities unit.
Levitt Will Advise AIG
American International Group, under fire by regulators for the use of reinsurance products to boost financial results, hired former Securities and Exchange Commission chairman Arthur Levitt as a special adviser. Levitt will advise AIG's board and its nominating and corporate governance committee on nominees for election to the board, as well as board procedures, structure and governance issues.
DHL to Curb Cigarette Deliveries
DHL will stop delivering cigarettes to individual consumers nationwide under an agreement with New York Attorney General Eliot L. Spitzer and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Spitzer said DHL is the first major shipping company to agree to the ban and negotiations continue with other companies and the U.S. Postal Service.
Metabolife Plans to Sell Assets
Metabolife International, a dietary supplement maker facing falling revenue and hundreds of lawsuits, filed for bankruptcy protection under which it plans sell its assets at auction. Ideasphere, a maker of foods and supplements, has offered $23.5 million for the assets and will become the opening bidder, Metabolife said in a statement.
Metabolife has faced lawsuits since 1999 over products containing ephedra, a weight-loss ingredient linked to heart problems and strokes. It has spent $20 million defending itself in the suits.
Mack's Pay Package Outlined
Morgan Stanley's new chief executive, John Mack, will be paid $775,000 a year in salary and receive a bonus similar to what his counterparts at the firm's four Wall Street rivals get. Mack, 60, also gets a one-time restricted-stock grant of 500,000 shares that vests over the life of his contract, according to a regulatory filing. Mack earned $27.8 million from Morgan Stanley in 2000, his last full year there before he stepped down as president.
Adelphia Out of Long-Distance
Adelphia Communications agreed to sell its long-distance telephone business to Pioneer Telephone for $1.2 million. The unit has about 110,000 subscribers in 27 states. Pioneer offered to take the business after Adelphia said it was closing the unit because it had not attracted a buyer.
Omnicare Acquires RxCrossroads
Omnicare, which offers pharmaceuticals and services to elder-care facilities, bought drug services provider RxCrossroads of Louisville for $235 million. Omnicare, based in Covington, Ky., also offered $34.75 per share to acquire Baltimore-based NeighborCare, which last week urged shareholders to reject Omnicare's sweetened offer of $32 per share.
Interest rates on short-term Treasury bills rose to the highest level in nearly four years. The Treasury Department auctioned $16 billion in three-month bills at a discount rate of 3.145 percent, up from 3.08 percent last week. Six-month bills were auctioned at a discount rate of 3.325 percent, up from 3.22 percent. The actual return to investors is 3.214 percent for three-month bills, with a $10,000 bill selling for $9,920.50, and 3.429 percent for a six-month bill selling for $9,831.90.
Separately, the Federal Reserve said that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, rose to 3.46 percent last week from 3.4 percent the previous week.
Compiled from staff and news service reports.