Factories heated up last month, unexpectedly posting their biggest output gains since last summer and helping overall industrial production reverse a weather-related January decline, the Federal Reserve said Monday.
Manufacturing output surged 0.8 percent in February, after a 0.9 percent drop the previous month that the Fed said resulted from extreme winter weather that hit much of the country.
The jump was the largest since August and exceeded analyst expectations for a 0.3 percent increase. Auto factories were a big factor in the rise, with output of motor vehicles and parts increasing 4.8 percent last month after dropping 5.2 percent in January.
The report was another indication that economic growth was picking up again after being stalled by bitter cold and snow this winter. The Fed said much of the big swing in output reflected the effect of the weather, with production rates returning to “more normal levels” last month.
Factories are a major component of industrial production, which includes output from mines and power plants. That overall production also rose sharply, up 0.6 percent last month after declining a revised 0.2 percent in January. Economists had projected a 0.3 percent increase in February.
Output from electric and gas utilities dropped 0.2 percent after a 3.8 percent increase in January “but remained elevated because of the strong demand for heating due to the unusually cold weather,” the Fed said.
— Los Angeles Times
● Dorian Nakamoto — the man Newsweek says created the digital currency Bitcoin — said through a Los Angeles-based lawyer, Ethan Kirschner, that he “unconditionally” rejects the claim. “I did not create, invent, or otherwise work on Bitcoin,” Nakamoto said in the statement. “I have no knowledge of, nor have I ever worked on, cryptography, peer-to-peer systems, or alternative currencies.” Nakamoto said this was his last statement on the Newsweek report.
● Exxon Mobil sold $5.5 billion in its biggest bond offering on record as the world’s largest energy producer by market value ends a more than two-decade hiatus from the U.S. bond market. Exxon, which commands top AAA credit ratings from Moody’s Investors Service and Standard & Poor’s, issued fixed- and floating-rate notes in a five-part sale.
Exxon last issued bonds in 1993.
● Yahoo is benefiting from its stake in China’s hottest Internet company, Alibaba Group. Investors latched on to Yahoo in anticipation of a huge windfall from Alibaba’s initial public offering of stock later this year. Yahoo’s stock gained 4 percent to close at $39.11. Alibaba ignited the excitement about its forthcoming IPO by announcing plans to list its stock on a U.S. exchange. Yahoo is expected to sell about half its 24 percent stake in Alibaba as part of an IPO that analysts say could raise $15 billion.
● VeriSign, which manages a directory of Internet addresses, fell the most since November 2012 amid concern that its business may be hurt by a U.S. plan to shift control of the system for assigning Web site addresses. The stock dropped 5.8 percent to close at $51.68. The U.S. government on Friday said it would fulfill a pledge it made as far back as 1998 to relinquish control of the Internet’s domain-name system.
● American Express agreed to spin off half its business-travel unit in a $900 million deal that creates a joint venture with a group that includes Qatar’s sovereign-wealth fund. The credit-card issuer will sell the 50 percent stake for $900 million to the investor group that was formed by Certares International Bank and includes Qatar Holding, the Qatari firm said in a statement. The transaction is expected to be completed in the second quarter.
— From staff reports, news services
● 8:30 a.m.: Housing starts, consumer price index for February.