New-Home Sales Rise 2.1%
Sales of new homes in September rose 2.1 percent from the August tally, which was revised downward to an 11.6 decline from July, according to the Commerce Department. But the September level was about 0.1 percent below a year ago, and the supply of homes available for sale shot up to a record 493,000, after reaching a high in August of 478,000. The median sales price increased 1.9 percent year over year, to $215,700.
Economists say the data are consistent with reports that the market is cooling as mortgage interest rates rise.
Durable-Goods Orders Fall
U.S. durable-goods orders fell more than forecast in September as Hurricane Katrina pushed up fuel prices and chipped away at corporate confidence, suggesting the economy slowed at the end of the third quarter. Orders for expensive items made to last several years dropped 2.1 percent after a 3.8 percent gain in August, more than initially reported, the Commerce Department said.
Excluding transportation equipment, durable goods orders unexpectedly declined 1 percent last month after surging 5.1 percent, the biggest gain since March 2004.
Delphi Financing Plan Approved
A federal bankruptcy judge in New York gave Delphi permission to borrow up to $2 billion from J.P. Morgan Chase, Citigroup and other lenders to pay employees and suppliers while it restructures.
Judge Robert D. Drain approved the request after the Troy, Mich.-based automobile parts supplier resolved secured creditors' objections to the financing. His approval extended permission earlier in October for Delphi to use $950 million of financing. Delphi has said it does not have enough cash to keep operating without the financing.
WorldCom Pension Claims Settled
Citigroup, J.P. Morgan Chase and 12 other banks will pay $639 million to settle claims that they should have uncovered WorldCom's accounting fraud before selling its bonds, investors' lawyers said.
The settlement with 65 retirement funds is separate from the $6.1 billion that the same WorldCom underwriters and former directors agreed to pay to resolve a class-action lawsuit. Pension funds, including the California Public Employees Retirement System, opted out of the broader fraud case to press their claims individually.
Bristol Seeks to End Merck Deal
Bristol-Myers Squibb said that a diabetes drug it was touting as part of its turnaround will need at least five more years of testing to meet regulators' requirements. The company also said it was seeking to end an arrangement with Merck to jointly develop the drug, called Pargluva.
The companies applied to the Food and Drug Administration for approval of Pargluva last December. Earlier this month, the FDA issued a letter requesting more information, specifically regarding the drug's cardiovascular effects, the companies said.
Raytheon, the world's largest missile maker, said third-quarter profit climbed 50 percent, to $228 million from $152 million in the comparable quarter a year earlier, as the war in Iraq lifted sales of defense electronics and surveillance gear and orders for corporate jets increased. Sales increased a less-than-anticipated 8 percent, to $5.33 billion.
Countrywide Financial said its third-quarter profit rose 27 percent, to $633.9 million from $498.1 million as its home loan payment processing fees surged. The Calabasas, Calif.-based mortgage lender's revenue grew by 29 percent, to $2.71 billion.
Waste Management reported a 29 percent drop in its third-quarter profit, to $215 million from $302 million, as it took $61 million in one-time charges from scrapping revenue management software. Revenue grew 3 percent, to $3.38 billion.
Northwest Airlines' third-quarter loss widened to $475 million from $46 million as the airline took charges totaling $82 million from freezing non-union workers' pensions and $159 million from bankruptcy-related expenses. Revenue rose nearly 11 percent, to $3.38 billion.
Union Pacific said its third-quarter profit climbed 83 percent, to $369 million from $202 million with the help of a $118 million after-tax income tax expense reduction. The railroad's revenue rose 13 percent, to $3.46 billion.
Compiled from staff and news service reports.