US home prices rise 12.2 percent, best in 6 years
WASHINGTON (AP) U.S. home prices jumped 12.2 percent in May compared with a year ago, the biggest annual gain since March 2006. The increase shows the housing recovery is strengthening.
The Standard & Poor's/Case-Shiller 20-city home price index released Tuesday also surged 2.4 percent in May from April. The month-over-month gain nearly matched the 2.6 percent increase in April from March the highest on record.
The price increases were widespread. All 20 cities showed gains in May from April and compared with a year ago.
Home values are rising as more people are bidding on a scarce supply of houses for sale. Steady price increases, along with stable job gains and historically low mortgage rates, have in turn encouraged more Americans to buy homes.
One concern is that higher mortgage rates could slow home sales. But many economists say rates remain low by historical standards and would need to rise much faster to halt the momentum.
Unemployment rates rise in 90 pct. of US cities
WASHINGTON (AP) Unemployment rates rose in nearly all large U.S. cities in June as college graduates and many of those still in school began searching for jobs.
The Labor Department said Tuesday that unemployment rates rose in 347 large metro areas in June compared with the previous month. They fell in 12 and were unchanged in 13. In May, rates fell in 109 cities and rose in 243.
Unlike the national figures, the metro unemployment data are not adjusted for such seasonal changes. Many of the cities with significant rate increases have large universities where students graduated in June and began looking for work. And many university workers are temporarily unemployed in the summer when the academic year ends.
Nationally, the unemployment rate was 7.6 percent in June, down from 8.2 percent a year ago. Employers added 195,000 jobs last month. That's close to average monthly gain in the first half of this year of 202,000. Hiring averaged only 180,000 a month in the previous six months.
US consumer confidence dips from 5-year high
WASHINGTON (AP) Americans' confidence in the economy fell only slightly in July but stayed close to a 5 ½-year high, a sign that consumers should continue to help drive growth in the coming months.
The Conference Board, a New York-based private research group, said Tuesday that its consumer confidence index dipped to 80.3 in July. That's down from a reading of 82.1 in June, which was revised slightly higher and the best reading since January 2008.
Despite the slight drop in July, confidence remains well above year-ago levels. And consumers are more optimistic about the current job market.
Delay of employer penalties will cost government $10B
WASHINGTON (AP) The Obama administration's surprise decision to delay a key requirement of the health care law for employers will cost the government $10 billion, the nonpartisan Congressional Budget Office said Tuesday.
While that's a big number, the report from the official budget scorekeeper for Congress also put the administration's recent move within a wider perspective.
Overall, the delay for employers and other changes will raise the cost of the expanding coverage for the uninsured by less than 1 percent over 10 years from the budget agency's previous estimate in May, CBO said.
The White House announced earlier this month that it would delay a requirement for employers with 50 or more workers to offer affordable coverage, or face fines. Instead of going into effect next year, the provision was put off to 2015. A major concession to business groups, the delay took administration allies and adversaries by surprise.
FERC: JPMorgan owes $410M for price manipulation
WASHINGTON (AP) JPMorgan Chase & Co. agreed on Tuesday to pay $410 million to settle accusations by U.S. energy regulators that it manipulated electricity prices.
The Federal Energy Regulatory Commission said the bank used improper bidding strategies from 2010 through 2012 to squeeze excessive payments from the agencies that run the power grids in California and the Midwest.
JPMorgan, the biggest U.S. bank, is paying a civil penalty of $285 million and returning $125 million in allegedly improper profits.
FERC said its investigation had found improper trading practices were used at Houston-based JPMorgan Ventures Energy Corp.
New York-based JPMorgan said in a written statement that it's "pleased to have reached an agreement with FERC to put this matter behind it." JPMorgan didn't admit or deny any violations.
The move is part of a broad crackdown by FERC on alleged price manipulation.
Barclays plans share issue to fill capital hole
LONDON (AP) Barclays, Britain's second largest bank, plans to issue new shares worth 5.8 billion pounds ($8.9 billion) to shore up its capital and satisfy new regulatory requirements meant to prevent a repeat of the 2008 crisis. Its stock price plunged as investors worried that dividends would be cut and share value diluted.
The sale of stock to existing shareholders was announced Tuesday along with the bank's first half earnings, and came after the Prudential Regulation Authority told Barclays and other lenders to increase their capital as a buffer against future crises.
Barclays said its leverage ratio the amount of capital held against total assets was 2.2 percent compared with the new requirement of 3 percent. That translated to a shortfall in capital of 12.8 billion pounds ($19.6 billion).
The British regulator has increased pressure on banks to hold more capital at a time when they are also being pushed to lend more to businesses and families to help kick-start the economy, which has been slow to recover from the global economic crisis.
Obama challenges GOP to accept corporate tax deal
CHATTANOOGA, Tenn. (AP) Seeking to ease Washington gridlock, President Barack Obama on Tuesday challenged Republicans to accept a new fiscal deal to cut corporate tax rates in exchange for more government spending on jobs programs.
The offer was immediately panned by GOP lawmakers, who accused the president of repacking proposals he already supports and making no concessions to the opposing party.
Administration officials cast the corporate tax proposal as the first new economic idea the president plans to offer in the coming months. With budget deadlines looming this fall, the White House is seeking to refocus Obama's agenda on the economy in order to rally public support for his ideas and increase his leverage over the GOP.
Obama and Republicans have both long supported changes to the corporate tax code. But they differ over key details, including the exact rate and what should be done with any revenue generated by the changes.
Pfizer to pay $491M to resolve drug marketing case
NEW YORK (AP) Pfizer and the Justice Department say the drugmaker will pay almost $491 million to resolve an investigation into illegal marketing of the company's organ transplant drug Rapamune.
Rapamune was approved in 1999 for use in kidney transplant patients, and the Justice Department says sales representatives were trained to market the drug for use in other patients.
The U.S. Department of Justice says Pfizer Inc. will pay $257.4 million in civil settlements with federal and state governments and a $157.6 million criminal fine. It will also forfeit $76 million in assets.
Rapamune was originally made by Wyeth. Pfizer bought Wyeth in 2009.
The parties announced a proposed $491 million settlement in October.
By The Associated Press=
The Dow Jones Industrial average slipped a point to close at 15,520. The Standard & Poor's 500 index rose less than a point to close at 1,685 Tuesday. The Nasdaq composite rose 17 points, half a percent, to 3,616.
Benchmark oil for September delivery fell $1.47 to finish at $103.08 per barrel on the New York Mercantile Exchange. Wholesale gasoline rose 1 cent to finish at $3.02 a gallon. Heating oil fell 1 cent to end at $3.01 a gallon. Natural gas fell 4 cents to finish at $3.43 per 1,000 cubic feet.
Brent crude, the benchmark for international crudes, fell 54 cents to end at $106.91 on the ICE Futures exchange in London.